Highlands REIT (HHDS) 10-Q 14 May 20 2020 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2020	May 13, 2020
Document and Entity Information [Abstract]
Entity Registrant Name	Highlands REIT, Inc.
Entity Central Index Key	0001661458
Entity Filer Category	10-Q
Document Period End Date	Mar. 31, 2020
Amendment Flag	false
Entity Current Reporting Status	Yes
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Emerging Growth Company	true
Entity Ex Transition Period	true
Entity Small Business	true
Entity Common Stock, Shares Outstanding		879,553,830
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Entity Shell Company	false

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Investment properties
Land	$ 82,301	$ 82,877
Building and other improvements	288,534	289,351
Construction in progress	59	0
Total	370,894	372,228
Less accumulated depreciation	(58,901)	(56,431)
Net investment properties	311,993	315,797
Cash and cash equivalents	71,912	75,404
Restricted cash and escrows	3,402	2,651
Accounts and rents receivable (net of allowance of $1,176 and $1,178 as of March 31, 2020 and December 31, 2019, respectively)	3,266	3,105
Intangible assets, net	791	1,339
Deferred costs and other assets, net	2,354	1,936
Total assets	393,718	400,232
Liabilities
Debt, net	93,024	93,203
Accounts payable and accrued expenses	9,494	11,535
Intangible liabilities, net	811	842
Other liabilities	2,520	4,055
Total liabilities	105,849	109,635
Commitments and contingencies
Stockholders’ Equity
Common stock, $0.01 par value, 1,000,000,000 shares authorized, 879,553,830 and 876,074,038 shares issued and outstanding as of March 31, 2020 and December 31, 2019, respectively	8,796	8,761
Additional paid-in capital	1,410,211	1,408,993
Accumulated distributions in excess of net income	(1,130,471)	(1,127,270)
Accumulated other comprehensive (loss) income	(622)	18
Total Highlands REIT, Inc. stockholders’ equity	287,914	290,502
Non-controlling interests	(45)	95
Total equity	287,869	290,597
Total liabilities and equity	$ 393,718	$ 400,232

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Allowance for accounts and rent receivables	$ 1,176	$ 1,178
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	1,000,000,000	1,000,000,000
Common stock, shares issued	879,553,830	876,074,038
Common stock, shares outstanding	879,553,830	876,074,038

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations and Comprehensive Loss - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues
Total revenues	$ 9,286,000	$ 10,257,000
Expenses
Property operating expenses	2,199,000	1,904,000
Real estate taxes	1,651,000	1,306,000
Depreciation and amortization	3,295,000	2,730,000
General and administrative expenses	4,558,000	4,383,000
Total expenses	11,703,000	10,323,000
Gain on sale of investment properties, net	82,000	0
Loss from operations	(2,335,000)	(66,000)
Interest income	186,000	369,000
Interest expense	(1,080,000)	(758,000)
Net loss	(3,229,000)	(455,000)
Net loss attributable to non-controlling interests	28,000	0
Net loss attributable to Highlands REIT, Inc. common stockholders	$ (3,201,000)	$ (455,000)
Net income per common share, basic and diluted (in dollars per share)	$ 0	$ 0
Weighted average number of common shares outstanding, basic and diluted (in shares)	878,071,826	873,379,003
Comprehensive loss
Net income	$ (3,229,000)	$ (455,000)
Unrealized loss on derivatives	(752,000)	0
Total other comprehensive loss	(752,000)	0
Comprehensive loss	(3,981,000)	(455,000)
Comprehensive loss attributable to non-controlling interests	140,000	0
Comprehensive loss attributable to Highlands REIT, Inc. common stockholders	(3,841,000)	(455,000)
Rental income
Revenues
Total revenues	8,357,000	10,141,000
Other property income
Revenues
Total revenues	$ 929,000	$ 116,000

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Equity - USD ($) $ in Thousands	Total	Common Stock	Additional Paid-in Capital	Accumulated Other Comprehensive Loss	Accumulated Distributions in Excess of Net Income	Total Company's Stockholders' Equity	Non-controlling Interests
Beginning balance at Dec. 31, 2018	$ 284,100	$ 8,717	$ 1,407,502	$ 0	$ (1,132,119)	$ 284,100	$ 0
Beginning balance (in shares) at Dec. 31, 2018		871,688,704
Net income (loss)	(455)				(455)	(455)
Other comprehensive loss	0
Share-based compensation	1,365	$ 39	1,326			1,365
Share-based compensation (in shares)		3,900,689
Ending balance at Mar. 31, 2019	285,010	$ 8,756	1,408,828	0	(1,132,574)	285,010	0
Ending balance (in shares) at Mar. 31, 2019		875,589,393
Beginning balance at Dec. 31, 2019	290,597	$ 8,761	1,408,993	18	(1,127,270)	290,502	95
Beginning balance (in shares) at Dec. 31, 2019		876,074,038
Net income (loss)	(3,229)				(3,201)	(3,201)	(28)
Other comprehensive loss	(752)			(640)		(640)	(112)
Share-based compensation	1,253	$ 35	1,218			1,253
Share-based compensation (in shares)		3,479,792
Ending balance at Mar. 31, 2020	$ 287,869	$ 8,796	$ 1,410,211	$ (622)	$ (1,130,471)	$ 287,914	$ (45)
Ending balance (in shares) at Mar. 31, 2020		879,553,830

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash flows from operating activities:
Net loss	$ (3,229)	$ (455)
Adjustments to reconcile net income to net cash used in operating activities:
Depreciation and amortization	3,295	2,730
Amortization of above and below market leases, net	(30)	(113)
Amortization of debt discounts and financing costs	83	38
Straight-line rental income	25	(392)
Gain on sale of investment properties, net	(82)	0
Non-cash stock-based compensation expense	1,274	1,994
Changes in assets and liabilities:
Accounts and rents receivable, net	(185)	(242)
Deferred costs and other assets, net	(370)	(35)
Accounts payable and accrued expenses	(973)	(3,279)
Other liabilities	(2,288)	(250)
Net cash flows used in operating activities	(2,480)	(4)
Cash flows from investing activities:
Capital expenditures and tenant improvements	(112)	(118)
Acquisition of investment properties, net	0	(7,621)
Proceeds from sale of investment properties, net	1,287	0
Payment of leasing fees	(83)	(17)
Net cash flows provided by (used in) investing activities	1,092	(7,756)
Cash flows from financing activities:
Payment of debt issuance costs	(8)	(392)
Proceeds from credit agreement	0	29,375
Principal payments of mortgage debt	(255)	(159)
Payment for tax withholding for share-based compensation	(1,090)	(1,120)
Net cash flows (used in) provided by financing activities	(1,353)	27,704
Net (decrease) increase in cash, cash equivalents and restricted cash	(2,741)	19,944
Cash, cash equivalents and restricted cash, at beginning of period	78,055	83,741
Cash, cash equivalents and restricted cash, at end of period	75,314	103,685
Restricted Cash [Abstract]
Total cash, cash equivalents and restricted cash	$ 75,314	$ 103,685

Condensed Consolidated Statem_4

Condensed Consolidated Statements of Cash Flows (Parenthetical) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Supplemental disclosure of cash flows information:
Cash paid for interest	$ 1,046	$ 556
Cash paid for taxes	10	16
Supplemental schedule of non-cash investing and financing activities:
Lease assets and liabilities arising from the recognition of right-of-use assets	301	303
Assumption of mortgage debt on acquired properties	$ 0	$ 11,449

Organization

Organization	3 Months Ended
	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Organization Highlands REIT, Inc. (“Highlands”), which was formed in December 2015, is a Maryland corporation with a portfolio of industrial assets, retail assets, a correctional facility, multi-family assets, an office asset and unimproved land. Prior to April 28, 2016, Highlands was a wholly-owned subsidiary of InvenTrust Properties Corp. (“InvenTrust” and formerly known as Inland American Real Estate Trust, Inc.). Unless stated otherwise or the context otherwise requires, the terms “we,” “our” and “us” and references to the “Company” refer to Highlands and its consolidated subsidiaries. On April 28, 2016, Highlands was spun-off from InvenTrust through a pro rata distribution by InvenTrust of 100% of the outstanding shares of common stock, $0.01 par value per share (the “Common Stock”), of Highlands to holders of record of InvenTrust's common stock as of the close of business on April 25, 2016 (the “Record Date”). Each holder of record of InvenTrust's common stock received one share of Common Stock for every one share of InvenTrust's common stock held at the close of business on the Record Date (the “Distribution”). As a result, Highlands became an independent, self-advised, non-traded public company. Highlands has elected to be taxed, and currently qualifies, as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”) for U.S. federal income tax purposes commencing with Highlands' short taxable year ending December 31, 2016. Each of our assets is owned by a separate legal entity, which maintains its own books and financial records, and each entity’s assets are not available to satisfy the liabilities of other affiliated entities, except as otherwise disclosed in Note 7. With the exception of one asset we own through a variable interest entity with a third-party partner (the “Corvue Venture”), we are the sole owner of each of these separate legal entities. As of March 31, 2020, we have an approximate 85% interest in the Corvue Venture and have funded equity contributions to the Corvue Venture in the approximate amount of $9,000 . See Note 2 for additional information regarding the basis of presentation of the Corvue Venture, which is consolidated in the accompanying condensed consolidated financial statements. As of March 31, 2020 , the Company owned 19 assets and one parcel of unimproved land. As of December 31, 2019 , the Company owned 20 assets and one parcel of unimproved land.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and require 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 condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. Refer to the Company’s audited consolidated financial statements for the year ended December 31, 2019 included in the Company’s Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission on March 20, 2020, as certain note disclosures contained in such audited financial statements have been omitted from these interim condensed consolidated financial statements. Principles of Consolidation and Basis of Presentation The accompanying condensed consolidated financial statements reflect the accounts of Highlands and its consolidated subsidiaries. Highlands consolidates its wholly-owned subsidiaries and any other entities which it controls (i) through voting rights or similar rights or (ii) by means other than voting rights if Highlands is the primary beneficiary of a variable interest entity (“VIE”). The portions of the equity and net income of consolidated subsidiaries that are not attributable to the Company are presented separately as amounts attributable to non-controlling interests in our condensed consolidated financial statements. Entities which Highlands does not control, and entities which are VIEs in which Highlands is not a primary beneficiary, if any, are accounted for under appropriate GAAP. Highlands' subsidiaries generally consist of limited liability companies (“LLCs”). The effects of all significant intercompany transactions have been eliminated. Variable Interest Entities A VIE is an entity that either (i) has insufficient equity to permit the entity to finance its activities without additional subordinated financial support, or (ii) has equity investors who lack the characteristics of a controlling financial interest. Under Accounting Standards Codification (“ASC”) 810 - Consolidation, an entity that holds a variable interest in a VIE and meets certain requirements is considered the primary beneficiary of the VIE and is required to consolidate the VIE in its consolidated financial statements. In order to be considered the primary beneficiary of a VIE, an entity must hold a variable interest in the VIE and have both the power to direct the activities that most significantly impact the economic performance of the VIE, and the right to receive benefits from, or the obligation to absorb losses of, the VIE that could be potentially significant to the VIE. As of March 31, 2020 and December 31, 2019, respectively, we have determined we are the primary beneficiary of one VIE, the Corvue Venture, and have consolidated the operations of this entity in the accompanying consolidated financial statements. We reviewed the operating agreement of the Corvue Venture in order to determine our rights and the rights of our third-party partner, including whether those rights are protective or participating. We have determined we are the primary beneficiary of the Corvue Venture because we have (a) the power to direct the activities that most significantly impact the economic performance of the Corvue Venture, (b) the obligation to absorb the losses that could be significant to the Corvue Venture and (c) the right to receive the benefits that could be significant to the Corvue Venture. Included in total assets and liabilities on the Company’s condensed consolidated balance sheets as of March 31, 2020 is $27,805 and $19,770 , respectively, related to the Corvue Venture. Included in total assets and liabilities on the Company’s consolidated balance sheets as of December 31, 2019 is $28,073 and $19,074 , respectively, related to the Corvue Venture. The assets of the Corvue Venture may only be used to settle obligations of the Corvue Venture and the creditors of the Corvue Venture have no recourse to the general credit of the Company. Revenue Recognition The Company commences revenue recognition on our leases based on a number of factors. In most cases, revenue recognition under a lease begins when the lessee takes possession of, or controls, the physical use of the leased asset. Generally, this occurs on the lease commencement date. The determination of who is the owner, for accounting purposes, of the tenant improvements determines the nature of the leased asset and when revenue recognition under a lease begins. If we are the owner, for accounting purposes, of the tenant improvements, then the leased asset is the finished space and revenue recognition begins when the lessee takes possession of the finished space, typically when the improvements are substantially complete. If we conclude we are not the owner, for accounting purposes, of the tenant improvements (i.e., the lessee is the owner), then the leased asset is the unimproved space and any tenant improvement allowances funded under the lease are treated as lease incentives which reduces revenue recognized over the term of the lease. In these circumstances, we begin revenue recognition when the lessee takes possession of the unimproved space for the lessee to construct their own improvements. We consider a number of different factors to evaluate whether the Company or the lessee is the owner of the tenant improvements for accounting purposes. These factors include: • whether the lease stipulates how and on what a tenant improvement allowance may be spent; • whether the tenant or landlord retains legal title to the improvements; • the uniqueness of the improvements; • the expected economic life of the tenant improvements relative to the length of the lease; and • who constructs or directs the construction of the improvements. The determination of who owns the tenant improvements, for accounting purposes, is subject to significant judgment. In making that determination, we consider all of the above factors. No one factor, however, necessarily establishes its determination. Rental income is recognized on a straight-line basis over the term of each lease. The difference between rental income earned on a straight-line basis and the cash rent due under the provisions of the lease agreements is recorded as deferred rent receivable and is included as a component of accounts and rents receivable in the accompanying condensed consolidated balance sheets. Rental income lease-related receivables, which include contractual amounts accrued and unpaid from tenants and accrued straight-line rents receivable, are reduced for credit losses. Such amounts are recognized as a reduction to real estate rental revenues. The Financial Accounting Standards Board (“FASB”) clarified in July 2019 that, under ASC 842, lessors can continue to recognize a reserve (i.e., allowance for uncollectible operating lease receivables) under the loss contingency guidance in ASC 450-20 after applying the collectibility guidance in ASC 842. We evaluate the collectability of lease receivables monthly using several factors, including a lessee’s creditworthiness. We recognize the credit loss on lease-related receivables when, in the opinion of management, collection of substantially all lease payments is not probable. When collectability is determined not probable, any lease income subsequent to recognizing the credit loss is limited to the lesser of the lease income reflected on a straight-line basis or cash collected. The adoption of ASU 2016-02 resulted in an adjustment of $92 to rental income and property operating expenses, associated with lease-related receivables where collection of substantially all operating lease payments is not probable as of January 1, 2019. There were no material changes to that assessment as of March 31, 2020. The Company records lease termination income, included in other property income, if there is a signed termination agreement, all of the conditions of the agreement have been met and amounts due are considered collectible. Real Estate We allocate the purchase price of real estate to land, building, other building improvements, tenant improvements, and intangible assets and liabilities (such as the value of above- and below-market leases, in-place leases and origination costs associated with in-place leases). The values of above- and below-market leases are recorded as intangible assets, net, and intangible liabilities, net, respectively, in the condensed consolidated balance sheets, and are amortized as either a decrease (in the case of above-market leases) or an increase (in the case of below-market leases) to rental income over the remaining term of the associated tenant lease. The values associated with in-place leases are recorded in intangible assets, net, in the condensed consolidated balance sheets and are amortized to depreciation and amortization expense in the condensed consolidated statements of operations and comprehensive income over the remaining lease term. The difference between the contractual rental rates and our estimate of market rental rates is measured over a period equal to the remaining non-cancelable term of the leases, including below-market renewal options for which exercise of the renewal option appears to be reasonably assured. The remaining term of leases with renewal options at terms below market reflect the assumed exercise of such below-market renewal options and assume the amortization period would coincide with the extended lease term. In the event of early lease termination, the remaining net book value of any above- or below-market lease intangible is recognized as an adjustment of rental income, and the remaining net book value of any in-place lease intangible is recognized as accelerated amortization expense. We perform, with the assistance of a third-party certified valuation specialist, the following procedures for properties we acquire: • Estimate the value of the property “as if vacant” as of the acquisition date; • Allocate the value of the property among land, building, and other building improvements and determine the associated useful life for each; • Calculate the value and associated life of above- and below-market leases on a tenant-by-tenant basis. The difference between the contractual rental rates and our estimate of market rental rates is measured over a period equal to the remaining term of the leases (using a discount rate which reflects the risks associated with the leases acquired, including geographical location, size of leased area, tenant profile and credit risk); • Estimate the fair value of the tenant improvements, legal expenses and leasing commissions incurred to obtain the leases and calculate the associated useful life for each; • Estimate the fair value of assumed debt, if any, and value the favorable or unfavorable debt position acquired; and • Estimate the intangible value of the in-place leases based on lease execution costs of similar leases as well as lost rent payments during an assumed lease-up period and their associated useful lives on a tenant-by-tenant basis. We recognize gains and losses from sales of investment properties and land in accordance with FASB ASC 610-20, “Gains and Losses From the Derecognition of Nonfinancial Assets.” We recognize gains and losses from sales of investment properties and land when we transfer control of a property and when it is probable that we will collect substantially all of the related consideration. Capitalization and Depreciation Real estate is reflected at cost less accumulated depreciation. Ordinary repairs and maintenance are expensed as incurred. Depreciation expense is computed using the straight-line method. Building and other improvements are depreciated based upon estimated useful lives of 30 years for building and improvements and 5 - 15 years for furniture, fixtures and equipment and site improvements. Tenant improvements are amortized on a straight-line basis over the lesser of the life of the tenant improvement or the lease term as a component of depreciation and amortization expense. Leasing fees are amortized on a straight-line basis over the life of the related lease as a component of depreciation and amortization expense. Loan fees are amortized on a straight-line basis, which approximates the effective interest method, over the life of the related loan as a component of interest expense. Direct and indirect costs that are clearly related to the construction and improvements of investment properties are capitalized. Costs incurred for property taxes and insurance are capitalized during periods in which activities necessary to get the asset ready for its intended use are in progress. Interest costs are also capitalized during such periods. Assets Held for Sale In determining whether to classify an investment property as held for sale, the Company considers whether: (i) management has committed to a plan to sell the investment property; (ii) the investment property is available for immediate sale, in its present condition; (iii) the Company has initiated a program to locate a buyer; (iv) the Company believes that the sale of the investment property is probable; (v) the Company has received a significant non-refundable deposit for the purchase of the property; (vi) the Company is actively marketing the investment property for sale at a price that is reasonable in relation to its fair value; and (vii) actions required for the Company to complete the plan indicate that it is unlikely that any significant changes will be made to the plan. If all of the above criteria are met, the Company classifies the investment property as held for sale. On the day that these criteria are met, the Company suspends depreciation on the investment properties held for sale, including depreciation for tenant improvements and additions, as well as on the amortization of acquired in-place leases. The investment properties and liabilities associated with those investment properties that are held for sale are classified separately on the condensed consolidated balance sheets for the most recent reporting period and recorded at the lesser of the carrying value or fair value less costs to sell. There were no assets held for sale on the condensed consolidated balance sheets as of March 31, 2020 and December 31, 2019. Impairment The Company assesses the carrying values of the respective long-lived assets, whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable, such as a reduction in the expected holding period of the asset. If it is determined that the carrying value is not recoverable because the undiscounted cash flows do not exceed carrying value, the Company records an impairment loss to the extent that the carrying value exceeds fair value. The valuation and possible subsequent impairment of investment properties is a significant estimate that can and does change based on the Company’s continuous process of analyzing each asset and reviewing assumptions about uncertain inherent factors, as well as the economic condition of the asset at a particular point in time. The use of projected future cash flows and related holding period is based on assumptions that are consistent with the estimates of future expectations and the strategic plan the Company uses to manage its underlying business. However, assumptions and estimates about future cash flows and capitalization rates are complex and subjective. Changes in economic and operating conditions and the Company’s ultimate investment intent that occur subsequent to the impairment analyses could impact these assumptions and result in future impairment charges of the real estate assets. Going Concern Basis of Accounting When preparing financial statements for each annual and interim reporting period, management has the responsibility to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the Company’s ability to continue as a going concern within one year after the date that the financial statements are issued. In making its evaluation, the Company considers, but is not limited to, any risks and/or uncertainties to its results of operations, contractual obligations in the form of near-term debt maturities, dividend requirements, or other factors impacting the Company’s liquidity and capital resources. No conditions or events that raised substantial doubt about the ability to continue as a going concern within one year were identified as of the issuance date of the financial statements contained in this Quarterly Report on Form 10-Q. Recently Issued Accounting Pronouncements On April 10, 2020, the FASB issued a document titled “Staff Q&A, Topic 842 and Topic 840: Accounting for Lease Concessions Related to the Effects of the COVID-19 pandemic” (“FASB Q&A document”), which focused on the application of lease guidance for concessions related to the effects of the coronavirus disease 2019 (“COVID-19”) pandemic. In this document, the FASB staff will allow entities to make an election to account for lease concessions related to the effects of the COVID-19 pandemic consistent with how those concessions would be accounted for under Topic 842, Leases, (“Topic 842”) as though enforceable rights and obligations for those qualifying concessions existed. The Company is continuing to evaluate the impact of this optional election on the condensed consolidated financial statements and related disclosures. The FASB also acknowledged that some concessions will provide a deferral of payments with no substantive changes to the consideration in the original contract. The FASB indicated that a deferral affects the timing, but the amount of consideration is substantially the same as that required under the original contract. The staff expects that there will be multiple ways to account for those deferrals, none of which the staff believes are more preferable than others. Two of those methods are: • Account for the concessions as if no changes to the lease contract were made. Under that accounting, a lessor would increase its lease receivable, and a lessee would increase its accounts payable as receivables accrue. In its statements of operations, a lessor would continue to recognize income, and a lessee would continue to recognize expense during the deferral period. • Account for the deferred payments as a variable lease payment. In cases where we grant a deferral in future periods as a result of COVID 19, we will account for the concessions as if no changes to the lease contract were made. Under that accounting, we would increase our lease receivable as receivables accrue in our statements of operations and will continue to recognize rental income during the deferral period. In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848)”. ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During March 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. Recently Adopted Accounting Pronouncements In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement”. This ASU modifies the disclosure requirements on fair value measurements. The ASU removes the requirement to disclose: the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; and the valuation processes for Level 3 fair value measurements. The adoption of this ASU on January 1, 2020 did not have a material impact on our condensed consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases”, which established ASC 842, Leases, which introduces a lessee model that brings most leases on the balance sheet and, among other changes, eliminates the requirement in current GAAP for an entity to use bright-line tests in determining lease classification. ASC 842 allows for several practical expedients which permit the following: no reassessment of lease classification or initial direct costs; use of the standard’s effective date as the date of initial application; and no separation of non-lease components from the related lease components and, instead, to account for those components as a single lease component if certain criteria are met. We elected these practical expedients, upon adoption, on January 1, 2019, using the effective date as our date of initial application and no transition adjustment was recognized. Therefore, financial information and disclosures under ASC 842 will not be provided for periods prior to January 1, 2019. The Company elected the practical expedient, among others, to not separate lease and non-lease components for all qualifying leases. For leases with a term of twelve months or less, the Company has made a policy election to not recognize lease liabilities and lease assets. Due to the new standard’s narrowed definition of initial direct costs, beginning January 1, 2019, the Company recognizes expense as incurred on certain lease origination costs previously capitalized and amortized to expense over the lease term. Any costs no longer qualifying as initial direct costs are an increase to property operating expenses in the condensed consolidated statements of operations and comprehensive income in the period of adoption and prospectively. As a lessee, beginning January 1, 2019, the Company recognized a right-of-use asset and lease liability included in deferred costs and other assets and other liabilities, respectively, with a balance as of March 31, 2020 , on the condensed consolidated balance sheets of approximately $296 , which was estimated by utilizing an average discount rate of approximately 4.5% , reflecting the Company's incremental borrowing rate. As a lessor, the Company believes that substantially all of the Company's leases will continue to be classified as operating leases under the new standard and will continue to record revenues from rental properties on a straight-line basis. However, certain ground, anchor, and other long-term leases entered into or acquired have an increased likelihood of being classified as either sales-type or finance-type leases. In June 2018, the FASB issued ASU No. 2018-07, “Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting”. This ASU is intended to simplify aspects of share-based compensation issued to non-employees by making the guidance consistent with the accounting for employee share-based compensation. It is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2018. The adoption of ASU No. 2018-07 on January 1, 2019 did not have a material impact on our condensed consolidated financial statements. In December 2018, the FASB issued ASU 2018-20, “Leases (Topic 842): Narrow-Scope Improvements for Lessors,” which addresses specific issues in the leasing guidance, including sales taxes and other similar taxes collected from lessees, certain lessor costs paid directly by lessees, and recognition of variable payments for contracts with lease and non-lease components. Prior to the adoption of ASU 2018-20, the Company recognized tenant recovery income regardless of whether the third party was paid by the lessor or lessee. Effective January 1, 2019, such tenant recoveries are only recognized to the extent that the Company pays the third party directly and are classified as rental income on the Company’s condensed consolidated statements of operations and comprehensive loss.

Acquired Properties

Acquired Properties	3 Months Ended
	Mar. 31, 2020
Asset Acquisitions [Abstract]
Acquired Properties	Acquired Properties There were no acquisitions during the quarter ended March 31, 2020. The Company records identifiable assets and liabilities acquired at fair value. During the three months ended March 31, 2019, the Company acquired two multi-family assets for a gross acquisition price of $19,070 , including capitalized transaction costs of approximately $ 70 . Property Location Acquisition Date Acquisition Price The Detroit and Detroit Terraces Denver, Colorado January 8, 2019 $ 19,070 The purchase price allocation has been recorded as follows: Land $ 3,370 Buildings and other improvements 15,006 Intangible assets, net 301 Total assets $ 18,677 Debt discount on mortgage assumption 393 Total liabilities $ 393 Total acquisition price $ 19,070

Disposed Properties

Disposed Properties	3 Months Ended
	Mar. 31, 2020
Discontinued Operations and Disposal Groups [Abstract]
Disposed Properties	Disposed Properties The following table reflects the property dispositions during the three months ended March 31, 2020 . The Company recognized a net gain on sale of investment properties of $82 . Property Location Disposition Date Gross Disposition Price Sale Proceeds, Net Gain on Sale Citizens Providence, Rhode Island March 31, 2020 $ 1,425 $ 1,287 $ 82 There were no dispositions during the quarter ended March 31, 2019.

Leases

Leases	3 Months Ended
	Mar. 31, 2020
Leases [Abstract]
Leases	Leases Leasing as a lessor Revenue Recognition We lease multifamily properties under operating leases with terms of generally one year or less. We lease commercial properties (our net lease, office and retail segments) under operating leases with remaining lease terms that range from less than one year to ten years as of March 31, 2020 and December 31, 2019. We recognize rental income and rental abatements from our multifamily and commercial leases when earned on a straight-line basis over the lease term. Recognition of rental income commences when control of the leased space has been transferred to the tenant. We recognize cost reimbursement income from pass-through expenses on an accrual basis over the periods in which the expenses were incurred. Pass-through expenses are comprised of real estate taxes, operating expenses and common area maintenance costs which are reimbursed by tenants in accordance with specific allowable costs per tenant lease agreements. Parking revenues are derived from leases and monthly parking agreements. We recognize parking revenues from leases on a straight-line basis over the lease term and other parking revenues as earned. Upon adoption of ASU 2016-02, we elected not to bifurcate lease contracts into lease and non-lease components, since the timing and pattern of revenue is not materially different and the non-lease components are not the primary component of the lease. Accordingly, both lease and non-lease components are presented in rental income in our condensed consolidated financial statements. The adoption of ASU 2016-02 did not result in a material change to our recognition of real estate rental revenue. Lease related receivables, which include contractual amounts accrued and unpaid from tenants and accrued straight-line rents receivable, are reduced for credit losses. Such amounts are recognized as a reduction to real estate rental revenues. The FASB clarified in July 2019 that, under ASC 842, lessors can continue to recognize a reserve (i.e., allowance for uncollectible operating lease receivables) under the loss contingency guidance in ASC 450-20 after applying the collectibility guidance in ASC 842. We evaluate the collectability of lease receivables monthly using several factors including a lessee’s creditworthiness. We recognize the credit loss on lease related receivables when, in the opinion of management, collection of substantially all lease payments is not probable. When collectability is determined not probable, any lease income subsequent to recognizing the credit loss is limited to the lesser of the lease income reflected on a straight-line basis or cash collected. In December 2019, the Company executed an amendment to its lease with Alta Devices, Inc. (“Alta”) for one building of our office asset located in San Jose, California. The amendment with Alta acknowledged Alta was in payment default of its lease, and we collected on a letter of credit. The lease terminated during the three months ended March 31, 2020 and $671 was recognized in rental income and $768 was recognized in other property income from the proceeds of the letter of credit that secured Alta's obligations under the lease. On August 2, 2019, we received a notice of non-renewal from The GEO Group, Inc. (“GEO”), indicating that it would not be seeking an extension of its lease on our Hudson correctional facility asset. The lease on this asset expired in January 2020 and GEO has vacated the facility. For the three months ended March 31, 2020, 6.6% of our revenue was derived from GEO's net lease on our Hudson correctional facility asset. A non-renewal by GEO was contemplated when we recorded an impairment of the asset of $3,765 during the fourth quarter of 2018. While we will seek to re-lease or find alternative users for this asset, given the nature of the property, its location and its extended period of vacancy, we expect it will be very difficult to re-lease or find alternative users for this property. Even if we are successful in finding alternative users, we expect it will take an extended period of time to do so, if at all. Further, we believe it is unlikely that we will be able to find alternative users on similar terms. As we do not expect to find alternative users, re-lease the property, or re-lease on similar terms in the foreseeable future, we expect the expiration of this lease to have a material adverse effect on our financial condition, cash flows and results of operations. Notwithstanding the expiration of this lease, we believe we have sufficient liquidity and capital resources to fund our operations for the foreseeable future. Lease income related to the Company's operating leases is comprised of the following: Three Months Ended March 31, 2020 2019 Lease income related to fixed lease payments $ 7,111 $ 8,203 Lease income related to variable lease payments 1,246 1,938 Other (1) 929 116 Lease income $ 9,286 $ 10,257 (1) For the three months ended March 31, 2020 and 2019, respectively, other is primarily comprised of parking revenues and termination fees related to early lease expirations. Future Minimum Rental Income As of March 31, 2020, commercial operating leases provide for future minimum rental income, assuming no expiring leases are renewed, as follows. Apartment leases are not included as the terms are generally for one year or less. 2020 (remaining) $ 6,821 2021 8,566 2022 7,403 2023 6,803 2024 6,330 Thereafter 25,472 Total $ 61,395 The majority of the revenue from the Company’s assets consists of rents received under long-term operating leases. Some leases provide for the payment of fixed base rent paid monthly in advance, and for the reimbursement by tenants to the Company for the tenant’s pro rata share of certain operating expenses including real estate taxes, special assessments, insurance, utilities, common area maintenance, management fees, and certain building repairs paid by the landlord and recoverable under the terms of the lease. Under these leases, the landlord pays all expenses and is reimbursed by the tenant for the tenant’s pro rata share of recoverable expenses paid. Certain other tenants are subject to net leases which provide that the tenant is responsible for fixed base rent as well as all costs and expenses associated with occupancy. Under net leases where all expenses are paid directly by the tenant rather than the landlord, such expenses are not included in the consolidated statements of operations and comprehensive income. Under leases where all expenses are paid by the landlord, subject to reimbursement by the tenant, the expenses are included within property operating expenses and reimbursements are included in tenant recovery income on the condensed consolidated statements of operations and comprehensive loss. Leasing as a Lessee We lease a portion of the land underlying one of our retail assets, Sherman Plaza, from a third party through a ground lease covering such land with a lease term expiring in October 2042. Upon adoption of ASU 2016-02, we recognized a right of use asset (included in deferred costs and other assets) and lease liability (included in other liabilities). At March 31, 2020, the balance was $296 and was recorded in the condensed consolidated balance sheets. We used a discount rate of approximately 4.5% , reflecting the Company's incremental borrowing rate as of January 1, 2019. During the three months ended March 31, 2020, we recognized a right of use asset (included in deferred costs and other assets) and lease liability (included in other liabilities) for leased assets from a third party for our corporate office space with a lease term expiring in December 2021. At March 31, 2020, the balance was $303 and was recorded in the condensed consolidated balance sheets. We used a discount rate of approximately 3.3% , reflecting the Company's incremental borrowing rate as of January 1, 2020. The following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments on our leases at March 31, 2020 and a reconciliation of those cash flows to the operating lease liability at March 31, 2020. 2020 (remaining) $ 148 2021 200 2022 21 2023 21 2024 21 Thereafter 373 784 Imputed interest (185 ) Lease liability $ 599
Leases	Leases Leasing as a lessor Revenue Recognition We lease multifamily properties under operating leases with terms of generally one year or less. We lease commercial properties (our net lease, office and retail segments) under operating leases with remaining lease terms that range from less than one year to ten years as of March 31, 2020 and December 31, 2019. We recognize rental income and rental abatements from our multifamily and commercial leases when earned on a straight-line basis over the lease term. Recognition of rental income commences when control of the leased space has been transferred to the tenant. We recognize cost reimbursement income from pass-through expenses on an accrual basis over the periods in which the expenses were incurred. Pass-through expenses are comprised of real estate taxes, operating expenses and common area maintenance costs which are reimbursed by tenants in accordance with specific allowable costs per tenant lease agreements. Parking revenues are derived from leases and monthly parking agreements. We recognize parking revenues from leases on a straight-line basis over the lease term and other parking revenues as earned. Upon adoption of ASU 2016-02, we elected not to bifurcate lease contracts into lease and non-lease components, since the timing and pattern of revenue is not materially different and the non-lease components are not the primary component of the lease. Accordingly, both lease and non-lease components are presented in rental income in our condensed consolidated financial statements. The adoption of ASU 2016-02 did not result in a material change to our recognition of real estate rental revenue. Lease related receivables, which include contractual amounts accrued and unpaid from tenants and accrued straight-line rents receivable, are reduced for credit losses. Such amounts are recognized as a reduction to real estate rental revenues. The FASB clarified in July 2019 that, under ASC 842, lessors can continue to recognize a reserve (i.e., allowance for uncollectible operating lease receivables) under the loss contingency guidance in ASC 450-20 after applying the collectibility guidance in ASC 842. We evaluate the collectability of lease receivables monthly using several factors including a lessee’s creditworthiness. We recognize the credit loss on lease related receivables when, in the opinion of management, collection of substantially all lease payments is not probable. When collectability is determined not probable, any lease income subsequent to recognizing the credit loss is limited to the lesser of the lease income reflected on a straight-line basis or cash collected. In December 2019, the Company executed an amendment to its lease with Alta Devices, Inc. (“Alta”) for one building of our office asset located in San Jose, California. The amendment with Alta acknowledged Alta was in payment default of its lease, and we collected on a letter of credit. The lease terminated during the three months ended March 31, 2020 and $671 was recognized in rental income and $768 was recognized in other property income from the proceeds of the letter of credit that secured Alta's obligations under the lease. On August 2, 2019, we received a notice of non-renewal from The GEO Group, Inc. (“GEO”), indicating that it would not be seeking an extension of its lease on our Hudson correctional facility asset. The lease on this asset expired in January 2020 and GEO has vacated the facility. For the three months ended March 31, 2020, 6.6% of our revenue was derived from GEO's net lease on our Hudson correctional facility asset. A non-renewal by GEO was contemplated when we recorded an impairment of the asset of $3,765 during the fourth quarter of 2018. While we will seek to re-lease or find alternative users for this asset, given the nature of the property, its location and its extended period of vacancy, we expect it will be very difficult to re-lease or find alternative users for this property. Even if we are successful in finding alternative users, we expect it will take an extended period of time to do so, if at all. Further, we believe it is unlikely that we will be able to find alternative users on similar terms. As we do not expect to find alternative users, re-lease the property, or re-lease on similar terms in the foreseeable future, we expect the expiration of this lease to have a material adverse effect on our financial condition, cash flows and results of operations. Notwithstanding the expiration of this lease, we believe we have sufficient liquidity and capital resources to fund our operations for the foreseeable future. Lease income related to the Company's operating leases is comprised of the following: Three Months Ended March 31, 2020 2019 Lease income related to fixed lease payments $ 7,111 $ 8,203 Lease income related to variable lease payments 1,246 1,938 Other (1) 929 116 Lease income $ 9,286 $ 10,257 (1) For the three months ended March 31, 2020 and 2019, respectively, other is primarily comprised of parking revenues and termination fees related to early lease expirations. Future Minimum Rental Income As of March 31, 2020, commercial operating leases provide for future minimum rental income, assuming no expiring leases are renewed, as follows. Apartment leases are not included as the terms are generally for one year or less. 2020 (remaining) $ 6,821 2021 8,566 2022 7,403 2023 6,803 2024 6,330 Thereafter 25,472 Total $ 61,395 The majority of the revenue from the Company’s assets consists of rents received under long-term operating leases. Some leases provide for the payment of fixed base rent paid monthly in advance, and for the reimbursement by tenants to the Company for the tenant’s pro rata share of certain operating expenses including real estate taxes, special assessments, insurance, utilities, common area maintenance, management fees, and certain building repairs paid by the landlord and recoverable under the terms of the lease. Under these leases, the landlord pays all expenses and is reimbursed by the tenant for the tenant’s pro rata share of recoverable expenses paid. Certain other tenants are subject to net leases which provide that the tenant is responsible for fixed base rent as well as all costs and expenses associated with occupancy. Under net leases where all expenses are paid directly by the tenant rather than the landlord, such expenses are not included in the consolidated statements of operations and comprehensive income. Under leases where all expenses are paid by the landlord, subject to reimbursement by the tenant, the expenses are included within property operating expenses and reimbursements are included in tenant recovery income on the condensed consolidated statements of operations and comprehensive loss. Leasing as a Lessee We lease a portion of the land underlying one of our retail assets, Sherman Plaza, from a third party through a ground lease covering such land with a lease term expiring in October 2042. Upon adoption of ASU 2016-02, we recognized a right of use asset (included in deferred costs and other assets) and lease liability (included in other liabilities). At March 31, 2020, the balance was $296 and was recorded in the condensed consolidated balance sheets. We used a discount rate of approximately 4.5% , reflecting the Company's incremental borrowing rate as of January 1, 2019. During the three months ended March 31, 2020, we recognized a right of use asset (included in deferred costs and other assets) and lease liability (included in other liabilities) for leased assets from a third party for our corporate office space with a lease term expiring in December 2021. At March 31, 2020, the balance was $303 and was recorded in the condensed consolidated balance sheets. We used a discount rate of approximately 3.3% , reflecting the Company's incremental borrowing rate as of January 1, 2020. The following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments on our leases at March 31, 2020 and a reconciliation of those cash flows to the operating lease liability at March 31, 2020. 2020 (remaining) $ 148 2021 200 2022 21 2023 21 2024 21 Thereafter 373 784 Imputed interest (185 ) Lease liability $ 599

Accounts Payable and Accrued Ex

Accounts Payable and Accrued Expenses	3 Months Ended
	Mar. 31, 2020
Payables and Accruals [Abstract]
Accounts Payable and Accrued Expenses	Accounts Payable and Accrued Expenses Accounts payable and accrued expenses consist of the following: March 31, 2020 December 31, 2019 Accrued real estate taxes $ 6,405 $ 6,372 Accrued compensation 1,242 3,606 Accrued interest payable 319 369 Other accrued expenses 1,528 1,188 $ 9,494 $ 11,535

Debt

Debt	3 Months Ended
	Mar. 31, 2020
Debt Disclosure [Abstract]
Mortgage Loans, Net	Total debt outstanding as of March 31, 2020 and December 31, 2019 was as follows: As of March 31, 2020 As of December 31, 2019 Debt, gross $ 94,670 94,926 Mortgage discount (336 ) (349 ) Deferred financing costs, net (1,310 ) (1,374 ) Total Debt, Net $ 93,024 $ 93,203 As of March 31, 2020 , scheduled maturities for the Company’s outstanding mortgage indebtedness and the credit facility had various due dates through August 2027, as follows: For the year ended December 31, As of March 31, 2020 Weighted average interest rate 2020 (remaining) $ — — % 2021 — — % 2022 9,114 5.24 % 2023 18,565 3.27 % (1) 2024 30,000 3.42 % Thereafter 36,991 4.38 % Total $ 94,670 3.94 % (1) See below for discussion of the swap agreement entered into with the mortgage loan obtained in connection with the acquisition of The Locale asset. The weighted average interest rate reflected is the strike rate. The Company's ability to pay off the mortgages when they become due is dependent upon the Company's ability either to refinance the related mortgage debt or to sell the related asset. With respect to each mortgage loan, if the applicable wholly-owned property-owning subsidiary is unable to refinance or sell the related asset, or in the event that the estimated asset value is less than the mortgage balance, the applicable wholly-owned property-owning subsidiary may, if appropriate, satisfy a mortgage obligation by transferring title of the asset to the lender or permitting a lender to foreclose. As of March 31, 2020 and December 31, 2019, none of our mortgage debt was recourse to the Company, although Highlands or its subsidiaries may act as guarantor under customary, non-recourse, carve-out guarantees in connection with obtaining mortgage loans on certain of our properties. Some of the mortgage loans require compliance with certain covenants, such as debt service ratios, investment restrictions and distribution limitations. As of March 31, 2020 and December 31, 2019 , the Company is in compliance with such covenants in all material respects. However, as discussed further in Note 14, we did not pay the April or May monthly payments due under the mortgages encumbering our retail properties (including Market at Hilliard, State Street and Buckhorn Plaza) because certain tenants at these properties failed to pay their April or May rental payments. On January 8, 2019, the Company assumed a mortgage loan in the principal amount of $11,089 , net of a debt discount of $360 in connection with the acquisition of The Detroit and Detroit Terraces. The contractual rate and terms of the assumed debt was marked to market as of the acquisition date. According to the terms of the note agreement, the contractual fixed interest rate is 3.99% and payments are interest-only through September 30, 2022 . The maturity date of the mortgage loan is on August 31, 2027. The Company obtained a mortgage loan in the principal amount of $18,750 in connection with the acquisition of The Locale on August 16, 2019. The Company entered into a swap agreement with respect to the loan, effective through its September 1, 2023 maturity date, to swap the variable interest rate to a fixed rate of approximately 3.27% per annum. The interest rate is based on the London Interbank Offered Rate (“LIBOR”) plus the applicable spread. The effective interest rate as of March 31, 2020, is approximately 3.33%. Credit Agreement On February 15, 2019, the Company entered into a Credit Agreement (the “Credit Agreement”) by and among the Company, as borrower, The Huntington National Bank (“HNB”), individually and as administrative agent, issuing lender, lead arranger, book manager and syndication agent, and certain other lenders thereunder. The Credit Agreement provides for (i) a secured revolving credit facility (the “Revolving Credit Facility”) with revolving commitments in an aggregate principal amount of $50,000 , including a letter of credit subfacility for 10% of the then available revolving commitments, and (ii) a secured term loan credit facility (the “Term Loan Facility” and together with the Revolving Credit Facility, the “Credit Facility”) with term loan commitments in an aggregate principal amount of $50,000 . The Credit Agreement provides that, subject to customary conditions, including obtaining lender commitments and compliance with its financial covenants under the Credit Agreement, the Company may seek to increase the aggregate lending commitments under the Credit Agreement by up to $100,000 , with such increase in total lending commitments to be allocated to increasing the revolving commitments and/or establishing one or more new tranches of term loans at the Company’s request. The Company currently expects to use borrowings under the Credit Facility for working capital purposes, repayment of indebtedness, capital expenditures, lease up costs, redevelopment costs, property acquisitions and other general corporate purposes. In connection with entering into the Credit Facility, the Company borrowed under the Term Loan Facility with a balance of $30,000 as of March 31, 2020. As of March 31, 2020 and December 31, 2019 , the Company is in compliance with such covenants in all material respects. The Revolving Credit Facility has a maturity date of February 15, 2022 , but can be extended at the Company’s option for two additional one -year periods conditioned on, among other things, payment of a 15-basis points extension fee upon each such extension. The Term Loan Facility has a maturity date of February 15, 2024. The Company is permitted to prepay all or any portion of the loans under the Credit Facility prior to maturity without premium or penalty, subject to reimbursement of any LIBOR breakage costs of the lenders. The interest rates applicable to loans under the Revolving Credit Facility are, at the Company’s option, equal to either a base rate plus a margin ranging from 1.0% to 1.3% per annum or LIBOR plus a margin ranging from 2.0% to 2.3% per annum based on the debt to assets ratio of the Company and its consolidated subsidiaries. The interest rates applicable to loans under the Term Loan Facility are, at the Company’s option, equal to either a base rate plus a margin ranging from 0.9% to 1.2% per annum or LIBOR plus a margin ranging from 1.9% to 2.2% per annum based on the debt to assets ratio of the Company and its consolidated subsidiaries. The Company has chosen the second option for the interest rate applicable to the current loan under the term loan facility during the three months ended March 31, 2020. In addition, the Company pays (a) an unused facility fee on the revolving commitments under the Revolving Credit Facility ranging from 0.15% to 0.25% per annum, calculated daily based on the average unused commitments under the Revolving Credit Facility, and (b) with respect to any amount of the Term Loan Facility that remains undrawn during the period beginning thirty (30) days after the execution of the Credit Agreement and ending one year after execution of the Credit Agreement, an unused facility fee of 0.25% per annum, calculated daily based on the undrawn portion of the Term Loan Facility. The Credit Facility is guaranteed, jointly and severally, by certain subsidiaries of the Company (the “Subsidiary Guarantors”), and is secured by a pledge of equity interests in the Subsidiary Guarantors. The Credit Agreement contains customary covenants that, among other things, restrict, subject to certain exceptions, the ability of the Company and its subsidiaries to incur indebtedness, grant liens on their assets, make certain types of investments, engage in acquisitions, mergers or consolidations, sell assets, enter into hedging transactions, enter into certain transactions with affiliates and make distributions. The Credit Agreement requires the Company to comply with financial covenants to be tested quarterly, including a maximum debt to asset value ratio, a minimum fixed charge coverage ratio, a minimum tangible net worth, a maximum variable rate debt to asset value ratio, a prohibition on recourse debt and a maximum amount of cross-collateralized non-recourse debt. The Credit Agreement also contains certain covenants around the value and diversity of the properties owned by the Subsidiary Guarantors. The Credit Agreement also contains certain customary events of default, including the failure to make timely payments under the Credit Facility or other material indebtedness, the failure to satisfy certain covenants and specified events of bankruptcy and insolvency.

Fair Value Measurements

Fair Value Measurements	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Fair Value Measurements	Fair Value Measurements In accordance with ASC 820, Fair Value Measurement and Disclosures, the Company defines fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company uses a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy consists of three broad levels, which are described below: • Level 1 - Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access. • Level 2 - Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. • Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The Company has estimated fair value using available market information and valuation methodologies the Company believes to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they are not necessarily indicative of amounts that would be realized upon disposition. Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis Risk Management Objective of Using Derivatives The Company is exposed to certain risk arising from both its business operations and economic conditions. The Company principally manages its exposures to a wide variety of business and operational risks through management of its core business activities. The Company manages economic risks, including interest rate, liquidity, and credit risk primarily by managing the amount, sources, and duration of debt funding and, to a limited extent, the use of derivative financial instruments. Specifically, the Company may enter into derivative financial instruments to manage exposures that arise from business activities that result in the receipt or payment of future known and uncertain cash amounts, the value of which are determined by interest rates. The Company’s derivative financial instruments, described below, are used to manage differences in the amount, timing, and duration of the Company’s known or expected cash receipts and its known or expected cash payments principally related to the Company’s borrowings. Cash Flow Hedges of Interest Rate Risk The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company may use interest rate swaps as part of its interest rate risk management strategy. Interest rate swaps designated as cash flow hedges involve the receipt of variable-rate amounts from a counterparty in exchange for the Company making fixed-rate payments over the life of the agreements without exchange of the underlying notional amount. We do not enter into derivative financial instruments for speculative purposes. As of March 31, 2020, we had one derivative financial instrument designated as a cash flow hedge, with a notional amount of $18,750 and a maturity date of September 1, 2023. This derivative is an interest rate swap that is measured at fair value on a recurring basis. For derivatives designated, and that qualify, as cash flow hedges of interest rate risk, the gain or loss on the derivative is recorded in accumulated other comprehensive income or loss on the condensed consolidated balance sheets and is subsequently reclassified into interest expense in the same period during which the hedged transaction affects earnings. The amount recorded as other comprehensive loss related to the unrealized loss on our derivative financial instrument was $752 for the three months ended March 31, 2020. The Company had no derivative instruments during the three months ended March 31, 2019. Realized gains and losses will be recognized as they accrue in interest expense. Amounts reported in accumulated other comprehensive loss related to derivatives will be reclassified to interest expense as interest payments are made on our variable rate debt. For the three months ended March 31, 2020, $752 was recognized in unrealized loss on derivatives in the condensed consolidated statements of operations and comprehensive loss. During the three months ended March 31, 2019, no unrealized loss or gain on derivatives was included on the condensed consolidated statements of operations and comprehensive loss. The Company estimates that $219 will be reclassified as an increase to interest expense over the next twelve months. The table below presents the fair value of the Company’s derivative financial instrument as well as its classification on the condensed consolidated balance sheets as of March 31, 2020 and December 31, 2019, respectively. March 31, 2020 Level 1 Level 2 Level 3 Total Derivative financial instruments designated as cash flow hedges: Classified as liabilities in “Other liabilities” $ — $ 732 $ — $ 732 December 31, 2019 Derivative financial instruments designated as cash flow hedges: Level 1 Level 2 Level 3 Total Classified as assets in “Deferred costs and other assets, net” $ — $ 21 $ — $ 21 The fair value of our derivative financial instrument was determined using widely accepted valuation techniques, including discounted cash flow analysis on the expected cash flows of the derivative financial instrument. This analysis reflected the contractual terms of the derivative, including the period to maturity, and used observable market-based inputs, including interest rate market data and implied volatilities in such interest rates. While it was determined that the majority of the inputs used to value the derivative fall within Level 2 of the fair value hierarchy under authoritative accounting guidance, the credit valuation adjustments associated with the derivative also utilized Level 3 inputs, such as estimates of current credit spreads to evaluate the likelihood of default. However, as of March 31, 2020, the significance of the impact of the credit valuation adjustments on the overall valuation of the derivative financial instrument was assessed, and it was determined that these adjustments were not significant to the overall valuation of the derivative financial instrument. As a result, it was determined that the derivative financial instrument in its entirety should be classified in Level 2 of the fair value hierarchy. Non-Recurring Measurements During the three months ended March 31, 2020 and 2019 , the Company did not identify any impairment triggers that required the assets to be measured at fair value. Financial Instruments Not Measured at Fair Value The table below represents the fair value of financial instruments presented at carrying values in the condensed consolidated financial statements as of March 31, 2020 and as of December 31, 2019 . March 31, 2020 December 31, 2019 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Debt $ 94,670 $ 90,193 $ 94,926 $ 94,934 The Company estimates the fair value of its debt instruments using a weighted average market effective interest rate of 4.54% and 3.93% per annum as of March 31, 2020 and December 31, 2019, respectively. The Company estimates the fair value of its mortgage loans and term loan facility by discounting the anticipated future cash flows of each instrument at rates currently offered to the Company by its lenders for similar debt instruments of comparable maturities. The rates used are based on credit spreads observed in the marketplace during the quarter for similar debt instruments, and a floor rate that the Company has derived using its subjective judgment for each asset segment. Based on this, the Company determines the appropriate rate for each of its individual mortgage loans and term loan facility based upon the specific terms of the agreement, including the term to maturity, the quality and nature of the underlying property and its leverage ratio. The weighted average market effective interest rates used range from 2.74% to 6.56% as of March 31, 2020 . For certain debt, the Company estimates the fair value of debt instruments based on the fair value of the underlying collateral. The Company has determined that its debt instrument valuations are classified in Level 2 of the fair value hierarchy. In July 2017, the Financial Conduct Authority, the authority that regulates LIBOR, announced it intends to stop compelling banks to submit rates for the calculation of LIBOR after 2021. The Alternative Reference Rates Committee (“ARRC”) has proposed that the Secured Overnight Financing RATE (“SOFR”) is the rate that represents best practice as the alternative to U.S. Dollar LIBOR (“USD-LIBOR”) for use in derivatives and other financial contracts that are currently indexed to USD-LIBOR. ARRC has proposed a paced market transition plan as it relates to derivatives and cash markets exposed to USD-LIBOR. There is no guarantee that a transition from LIBOR to an alternative will not result in financial market disruptions, significant increases in benchmark rates, or financing costs to borrowers. We have material contracts that are indexed to USD-LIBOR, and we are monitoring this activity and evaluating related risks.

Income Taxes

Income Taxes	3 Months Ended
	Mar. 31, 2020
Income Tax Disclosure [Abstract]
Income Taxes	Income Taxes The Company is taxed and operates in a manner that will allow the Company to continue to qualify as a REIT for U.S. federal income tax purposes. So long as it maintains its qualification as a REIT, the Company generally will not be subject to U.S. federal income tax on taxable income that is distributed to stockholders. A REIT is subject to a number of organizational and operational requirements, including a requirement that it distribute at least 90% of its REIT taxable income (subject to certain adjustments) to its stockholders each year. If the Company fails to continue to qualify as a REIT in any taxable year, without the benefit of certain relief provisions, the Company will be subject to U.S. federal and state income tax on its taxable income at regular corporate tax rates and would not be able to re-elect REIT status during the four years following the year of the failure. Although the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income and U.S. federal income and excise taxes on its undistributed income. During the three months ended March 31, 2020 and March 31, 2019, no income tax benefit or expense was included on the condensed consolidated statements of operations and comprehensive loss.

Segment Reporting

Segment Reporting	3 Months Ended
	Mar. 31, 2020
Segment Reporting [Abstract]
Segment Reporting	Segment Reporting GAAP has established guidance for reporting information about a company’s operating segments. The Company monitors and reviews its segment reporting structure in accordance with guidance under ASC Topic 280, Segment Reporting (“ASC 280”) to determine whether any changes have occurred that would impact its reportable segments. The Company currently has four business segments, consisting of (i) net lease, (ii) retail, (iii) multi-tenant office and (iv) multi-family. The net lease segment consists of single-tenant office and industrial assets, as well as the Company’s correctional facility. The Company’s unimproved land assets are presented below in Other. The following table summarizes net property operations by segment for the three months ended March 31, 2020 . Total Net Lease Retail Multi-Tenant Multi-family Other Rental income $ 8,357 $ 1,140 $ 2,876 $ 699 $ 3,642 $ — Other property income 929 — — 768 161 — Total income 9,286 1,140 2,876 1,467 3,803 — Operating expenses 3,850 423 1,444 204 1,639 140 Net operating income (loss) $ 5,436 $ 717 $ 1,432 $ 1,263 $ 2,164 $ (140 ) Non-allocated expenses (a) (7,853 ) Other income and expenses (b) (894 ) Gain on sale of investment properties (c) 82 Net loss attributable to non-controlling interests 28 Net loss attributable to Highlands REIT, Inc. common stockholders $ (3,201 ) Balance Sheet Data Real estate assets, net (d) $ 312,784 $ 33,161 $ 65,469 $ 26,267 $ 178,935 $ 8,952 Non-segmented assets (e) 80,934 Total assets $ 393,718 Capital expenditures $ 112 $ — $ — $ — $ 112 $ — (a) Non-allocated expenses consists of general and administrative expenses and depreciation and amortization. (b) Other income and expenses consists of interest income and interest expense. (c) Gain on the sale of investment properties is related to one net lease asset. (d) Real estate assets include intangible lease assets, net of amortization. (e) Non-segmented assets include cash and cash equivalents, restricted cash and escrows, accounts and rents receivable and deferred costs and other assets. The following table summarizes net property operations by segment for the three months ended March 31, 2019 . Total Net Lease Retail Multi-Tenant Multi-family Other Rental income $ 10,141 $ 3,180 $ 4,992 $ 753 $ 1,216 $ — Other property income 116 — 21 — 95 — Total income 10,257 3,180 5,013 753 1,311 — Operating expenses 3,210 157 2,167 175 553 158 Net operating income (loss) $ 7,047 $ 3,023 $ 2,846 $ 578 $ 758 $ (158 ) Non-allocated expenses (a) (7,113 ) Other income and expenses (b) (389 ) Net loss $ (455 ) Balance Sheet Data Real estate assets, net (c) $ 258,284 $ 35,927 $ 113,941 $ 26,808 $ 72,130 $ 9,478 Non-segmented assets (d) 114,390 Total assets $ 372,674 Capital expenditures $ 118 $ — $ 95 $ 8 $ 15 $ — (a) Non-allocated expenses consists of general and administrative expenses and depreciation and amortization. (b) Other income and expenses consists of interest income and interest expense. (c) Real estate assets include intangible lease assets, net of amortization. (d) Non-segmented assets include cash and cash equivalents, restricted cash and escrows, accounts and rents receivable and deferred costs and other assets.

Earnings Per Share

Earnings Per Share	3 Months Ended
	Mar. 31, 2020
Earnings Per Share [Abstract]
Earnings Per Share	Earnings Per Share Basic earnings per common share is calculated by dividing net income attributable to Highlands REIT, Inc. common stockholders by the weighted-average number of common shares outstanding during the period. Diluted earnings per common share is calculated by dividing net income attributable to Highlands REIT, Inc. common stockholders by the weighted-average number of common shares outstanding during the period, plus any additional common shares that would have been outstanding if the dilutive potential common shares had been issued. The following table reconciles net income attributable to the Company to basic and diluted EPS (in thousands, except share and per share data): Three Months Ended March 31, 2020 2019 Numerator: Net loss attributable to Highlands REIT, Inc. common stockholders $ (3,201 ) $ (455 ) Denominator: Weighted average number of common shares outstanding - basic and diluted 878,071,826 873,379,003 Basic and diluted earnings per share: Net loss per common share $ 0.00 $ 0.00

Share Based Compensation

Share Based Compensation	3 Months Ended
	Mar. 31, 2020
Share-based Payment Arrangement, Noncash Expense [Abstract]
Share Based Compensation	Share Based Compensation Incentive Award Plan On April 28, 2016, the board of directors adopted, ratified and approved the Highlands REIT, Inc. 2016 Incentive Award Plan (the “Incentive Award Plan”), under which the Company may grant cash and equity-based incentive awards to eligible employees, directors, and consultants. Prior to the Company’s spin-off from InvenTrust, the board of directors of the Company (then a wholly-owned subsidiary of InvenTrust) adopted, and InvenTrust, as the sole stockholder of Highlands, approved, the Incentive Awards Plan. For the three months ended March 31, 2020 , the Company granted 6,347,224 shares of common stock with an aggregate value of $2,285 based on an estimated net asset value per share of $0.36 . Additionally, for accounting purposes, the Company granted shares with an aggregate value of $125 that will vest in August 2020, subject to the applicable executive's continued employment with the Company through the vest date. During the three months ended March 31, 2019, the Company granted 5,814,286 of fully vested shares of common stock with an aggregate value of $2,035 based on an estimated net asset value per share of $0.35 . Under the Incentive Award Plan, the Company is authorized to grant up to 43,000,000 shares of the Company's common stock pursuant to awards under the plan. As of March 31, 2020 , 11,118,213 shares were available for future issuance under the Incentive Award Plan. A summary of the Company's stock awards activity as of March 31, 2020 is as follows: Non-Vested stock awards Stock Awards Weighted Average Grant Date Fair Value Balance at January 1, 2020 357,143 $ 0.35 Granted 6,347,224 0.36 Vested (6,347,224 ) 0.36 Other (1) (9,921 ) — Balance at March 31, 2020 347,222 $ 0.36 (1) Represents the change in the number of shares granted in 2019 based on an estimated net asset value per share of $0.35 and the actual shares vesting in 2020 based on an estimated net asset value per share of $0.36 For the three months ended March 31, 2020 and 2019 , the Company recognized stock-based compensation expense, included in general and administrative expenses in the accompanying condensed consolidated statements of operations, in the amount of $2,306 and $2,536 , respectively, related to the Incentive Award Plan. At March 31, 2020 , there was approximately $28 of estimated unrecognized compensation expense related to these awards, which is expected to be recognized through August 1, 2020. For the three months ended March 31, 2020 and 2019 , the Company paid $1,090 and $1,120 , respectively, related to tax withholding for share-based compensation.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies The Company is subject, from time to time, to various legal proceedings and claims that arise in the ordinary course of business. While the resolution of these matters cannot be predicted with certainty, management believes, based on currently available information, that the final outcome of such matters will not have a material adverse effect on the financial statements of the Company. Highlands has also agreed to indemnify InvenTrust against all taxes related to the Company, its subsidiaries and its assets, including taxes attributable to periods prior to the separation and distribution. InvenTrust has agreed to indemnify the Company for any taxes attributable to a failure by InvenTrust or MB REIT (Florida), Inc., a subsidiary of the Company, to qualify as a REIT for any taxable year ending on or before December 31, 2016.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2020
Subsequent Events [Abstract]
Subsequent Events	Subsequent Events As a result of the COVID-19 pandemic, we have experienced and may in the future continue to experience difficulty collecting timely rental payments from tenants that are experiencing financial difficulties and/or are (or have been) subject to governmental restrictions on their ability to operate their business. Tenants may default under their leases or declare bankruptcy. As a result, we may experience delays in enforcing our rights as a landlord and may incur substantial costs in protecting our investment and re-leasing our assets. Additionally, local and national authorities may expand or extend certain measures imposing restrictions on our ability to enforce our tenants’ contractual rental obligations, and we may not be able to re-lease space that becomes vacant on favorable terms or at all. During the second fiscal quarter of 2020, certain tenants at our retail properties (including Market at Hilliard, State Street and Buckhorn Plaza) failed to make the monthly rental payments due under their leases. As a result, we did not pay the April or May monthly payments due under the mortgages encumbering these properties. We have not made any decisions regarding future payments due under these mortgage loans. We are currently in discussions both with the tenants at each of these properties regarding the outstanding rental payments and future rent due under their leases and with the lenders regarding the mortgage debt encumbering each property. During the second fiscal quarter of 2020, we also received rent relief requests from certain tenants at our properties, most often in the form of rent deferral requests, as a result of COVID-19. We are evaluating each tenant rent relief request on an individual basis and are considering a number of factors. We believe that it is premature to fully determine the magnitude of the impact of the COVID-19 pandemic at this point. While we are not able to fully determine the impact of the COVID-19 pandemic at this time, we believe the pandemic has already affected and will continue to affect our financial and operational results and this impact could be material. We will continue to evaluate the nature and extent of the COVID-19 outbreak on our business, operations, cash flows and financial condition. On April 22, 2020, the Company, through The Sterling Owner, LLC, a wholly-owned subsidiary of the Company, completed the purchase of certain real property and improvements located at 470 20th Street, San Diego, California for a gross purchase price of $7,300 , exclusive of closing costs. The seller is not affiliated with the Company.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
Principles of Consolidation and Basis of Presentation	Principles of Consolidation and Basis of Presentation The accompanying condensed consolidated financial statements reflect the accounts of Highlands and its consolidated subsidiaries. Highlands consolidates its wholly-owned subsidiaries and any other entities which it controls (i) through voting rights or similar rights or (ii) by means other than voting rights if Highlands is the primary beneficiary of a variable interest entity (“VIE”). The portions of the equity and net income of consolidated subsidiaries that are not attributable to the Company are presented separately as amounts attributable to non-controlling interests in our condensed consolidated financial statements. Entities which Highlands does not control, and entities which are VIEs in which Highlands is not a primary beneficiary, if any, are accounted for under appropriate GAAP. Highlands' subsidiaries generally consist of limited liability companies (“LLCs”). The effects of all significant intercompany transactions have been eliminated.
Variable Interest Entities	Variable Interest Entities A VIE is an entity that either (i) has insufficient equity to permit the entity to finance its activities without additional subordinated financial support, or (ii) has equity investors who lack the characteristics of a controlling financial interest. Under Accounting Standards Codification (“ASC”) 810 - Consolidation, an entity that holds a variable interest in a VIE and meets certain requirements is considered the primary beneficiary of the VIE and is required to consolidate the VIE in its consolidated financial statements. In order to be considered the primary beneficiary of a VIE, an entity must hold a variable interest in the VIE and have both the power to direct the activities that most significantly impact the economic performance of the VIE, and the right to receive benefits from, or the obligation to absorb losses of, the VIE that could be potentially significant to the VIE.
Revenue Recognition	Revenue Recognition The Company commences revenue recognition on our leases based on a number of factors. In most cases, revenue recognition under a lease begins when the lessee takes possession of, or controls, the physical use of the leased asset. Generally, this occurs on the lease commencement date. The determination of who is the owner, for accounting purposes, of the tenant improvements determines the nature of the leased asset and when revenue recognition under a lease begins. If we are the owner, for accounting purposes, of the tenant improvements, then the leased asset is the finished space and revenue recognition begins when the lessee takes possession of the finished space, typically when the improvements are substantially complete. If we conclude we are not the owner, for accounting purposes, of the tenant improvements (i.e., the lessee is the owner), then the leased asset is the unimproved space and any tenant improvement allowances funded under the lease are treated as lease incentives which reduces revenue recognized over the term of the lease. In these circumstances, we begin revenue recognition when the lessee takes possession of the unimproved space for the lessee to construct their own improvements. We consider a number of different factors to evaluate whether the Company or the lessee is the owner of the tenant improvements for accounting purposes. These factors include: • whether the lease stipulates how and on what a tenant improvement allowance may be spent; • whether the tenant or landlord retains legal title to the improvements; • the uniqueness of the improvements; • the expected economic life of the tenant improvements relative to the length of the lease; and • who constructs or directs the construction of the improvements. The determination of who owns the tenant improvements, for accounting purposes, is subject to significant judgment. In making that determination, we consider all of the above factors. No one factor, however, necessarily establishes its determination. Rental income is recognized on a straight-line basis over the term of each lease. The difference between rental income earned on a straight-line basis and the cash rent due under the provisions of the lease agreements is recorded as deferred rent receivable and is included as a component of accounts and rents receivable in the accompanying condensed consolidated balance sheets. Rental income lease-related receivables, which include contractual amounts accrued and unpaid from tenants and accrued straight-line rents receivable, are reduced for credit losses. Such amounts are recognized as a reduction to real estate rental revenues. The Financial Accounting Standards Board (“FASB”) clarified in July 2019 that, under ASC 842, lessors can continue to recognize a reserve (i.e., allowance for uncollectible operating lease receivables) under the loss contingency guidance in ASC 450-20 after applying the collectibility guidance in ASC 842. We evaluate the collectability of lease receivables monthly using several factors, including a lessee’s creditworthiness. We recognize the credit loss on lease-related receivables when, in the opinion of management, collection of substantially all lease payments is not probable. When collectability is determined not probable, any lease income subsequent to recognizing the credit loss is limited to the lesser of the lease income reflected on a straight-line basis or cash collected. The adoption of ASU 2016-02 resulted in an adjustment of $92 to rental income and property operating expenses, associated with lease-related receivables where collection of substantially all operating lease payments is not probable as of January 1, 2019. There were no material changes to that assessment as of March 31, 2020. The Company records lease termination income, included in other property income, if there is a signed termination agreement, all of the conditions of the agreement have been met and amounts due are considered collectible.
Real Estate	Real Estate We allocate the purchase price of real estate to land, building, other building improvements, tenant improvements, and intangible assets and liabilities (such as the value of above- and below-market leases, in-place leases and origination costs associated with in-place leases). The values of above- and below-market leases are recorded as intangible assets, net, and intangible liabilities, net, respectively, in the condensed consolidated balance sheets, and are amortized as either a decrease (in the case of above-market leases) or an increase (in the case of below-market leases) to rental income over the remaining term of the associated tenant lease. The values associated with in-place leases are recorded in intangible assets, net, in the condensed consolidated balance sheets and are amortized to depreciation and amortization expense in the condensed consolidated statements of operations and comprehensive income over the remaining lease term. The difference between the contractual rental rates and our estimate of market rental rates is measured over a period equal to the remaining non-cancelable term of the leases, including below-market renewal options for which exercise of the renewal option appears to be reasonably assured. The remaining term of leases with renewal options at terms below market reflect the assumed exercise of such below-market renewal options and assume the amortization period would coincide with the extended lease term. In the event of early lease termination, the remaining net book value of any above- or below-market lease intangible is recognized as an adjustment of rental income, and the remaining net book value of any in-place lease intangible is recognized as accelerated amortization expense. We perform, with the assistance of a third-party certified valuation specialist, the following procedures for properties we acquire: • Estimate the value of the property “as if vacant” as of the acquisition date; • Allocate the value of the property among land, building, and other building improvements and determine the associated useful life for each; • Calculate the value and associated life of above- and below-market leases on a tenant-by-tenant basis. The difference between the contractual rental rates and our estimate of market rental rates is measured over a period equal to the remaining term of the leases (using a discount rate which reflects the risks associated with the leases acquired, including geographical location, size of leased area, tenant profile and credit risk); • Estimate the fair value of the tenant improvements, legal expenses and leasing commissions incurred to obtain the leases and calculate the associated useful life for each; • Estimate the fair value of assumed debt, if any, and value the favorable or unfavorable debt position acquired; and • Estimate the intangible value of the in-place leases based on lease execution costs of similar leases as well as lost rent payments during an assumed lease-up period and their associated useful lives on a tenant-by-tenant basis. We recognize gains and losses from sales of investment properties and land in accordance with FASB ASC 610-20, “Gains and Losses From the Derecognition of Nonfinancial Assets.” We recognize gains and losses from sales of investment properties and land when we transfer control of a property and when it is probable that we will collect substantially all of the related consideration. Capitalization and Depreciation Real estate is reflected at cost less accumulated depreciation. Ordinary repairs and maintenance are expensed as incurred. Depreciation expense is computed using the straight-line method. Building and other improvements are depreciated based upon estimated useful lives of 30 years for building and improvements and 5 - 15 years for furniture, fixtures and equipment and site improvements. Tenant improvements are amortized on a straight-line basis over the lesser of the life of the tenant improvement or the lease term as a component of depreciation and amortization expense. Leasing fees are amortized on a straight-line basis over the life of the related lease as a component of depreciation and amortization expense. Loan fees are amortized on a straight-line basis, which approximates the effective interest method, over the life of the related loan as a component of interest expense. Direct and indirect costs that are clearly related to the construction and improvements of investment properties are capitalized. Costs incurred for property taxes and insurance are capitalized during periods in which activities necessary to get the asset ready for its intended use are in progress. Interest costs are also capitalized during such periods.
Assets Held for Sale	Assets Held for Sale In determining whether to classify an investment property as held for sale, the Company considers whether: (i) management has committed to a plan to sell the investment property; (ii) the investment property is available for immediate sale, in its present condition; (iii) the Company has initiated a program to locate a buyer; (iv) the Company believes that the sale of the investment property is probable; (v) the Company has received a significant non-refundable deposit for the purchase of the property; (vi) the Company is actively marketing the investment property for sale at a price that is reasonable in relation to its fair value; and (vii) actions required for the Company to complete the plan indicate that it is unlikely that any significant changes will be made to the plan. If all of the above criteria are met, the Company classifies the investment property as held for sale. On the day that these criteria are met, the Company suspends depreciation on the investment properties held for sale, including depreciation for tenant improvements and additions, as well as on the amortization of acquired in-place leases. The investment properties and liabilities associated with those investment properties that are held for sale are classified separately on the condensed consolidated balance sheets for the most recent reporting period and recorded at the lesser of the carrying value or fair value less costs to sell.
Impairment	Impairment The Company assesses the carrying values of the respective long-lived assets, whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable, such as a reduction in the expected holding period of the asset. If it is determined that the carrying value is not recoverable because the undiscounted cash flows do not exceed carrying value, the Company records an impairment loss to the extent that the carrying value exceeds fair value. The valuation and possible subsequent impairment of investment properties is a significant estimate that can and does change based on the Company’s continuous process of analyzing each asset and reviewing assumptions about uncertain inherent factors, as well as the economic condition of the asset at a particular point in time. The use of projected future cash flows and related holding period is based on assumptions that are consistent with the estimates of future expectations and the strategic plan the Company uses to manage its underlying business. However, assumptions and estimates about future cash flows and capitalization rates are complex and subjective. Changes in economic and operating conditions and the Company’s ultimate investment intent that occur subsequent to the impairment analyses could impact these assumptions and result in future impairment charges of the real estate assets.
Recently Issued Accounting Pronouncements and Recently Adopted Accounting Pronouncements	Recently Issued Accounting Pronouncements On April 10, 2020, the FASB issued a document titled “Staff Q&A, Topic 842 and Topic 840: Accounting for Lease Concessions Related to the Effects of the COVID-19 pandemic” (“FASB Q&A document”), which focused on the application of lease guidance for concessions related to the effects of the coronavirus disease 2019 (“COVID-19”) pandemic. In this document, the FASB staff will allow entities to make an election to account for lease concessions related to the effects of the COVID-19 pandemic consistent with how those concessions would be accounted for under Topic 842, Leases, (“Topic 842”) as though enforceable rights and obligations for those qualifying concessions existed. The Company is continuing to evaluate the impact of this optional election on the condensed consolidated financial statements and related disclosures. The FASB also acknowledged that some concessions will provide a deferral of payments with no substantive changes to the consideration in the original contract. The FASB indicated that a deferral affects the timing, but the amount of consideration is substantially the same as that required under the original contract. The staff expects that there will be multiple ways to account for those deferrals, none of which the staff believes are more preferable than others. Two of those methods are: • Account for the concessions as if no changes to the lease contract were made. Under that accounting, a lessor would increase its lease receivable, and a lessee would increase its accounts payable as receivables accrue. In its statements of operations, a lessor would continue to recognize income, and a lessee would continue to recognize expense during the deferral period. • Account for the deferred payments as a variable lease payment. In cases where we grant a deferral in future periods as a result of COVID 19, we will account for the concessions as if no changes to the lease contract were made. Under that accounting, we would increase our lease receivable as receivables accrue in our statements of operations and will continue to recognize rental income during the deferral period. In March 2020, the FASB issued ASU No. 2020-04, “Reference Rate Reform (Topic 848)”. ASU 2020-04 contains practical expedients for reference rate reform related activities that impact debt, leases, derivatives and other contracts. The guidance in ASU 2020-04 is optional and may be elected over time as reference rate reform activities occur. During March 2020, the Company has elected to apply the hedge accounting expedients related to probability and the assessments of effectiveness for future LIBOR-indexed cash flows to assume that the index upon which future hedged transactions will be based matches the index on the corresponding derivatives. Application of these expedients preserves the presentation of derivatives consistent with past presentation. The Company continues to evaluate the impact of the guidance and may apply other elections as applicable as additional changes in the market occur. Recently Adopted Accounting Pronouncements In August 2018, the FASB issued ASU No. 2018-13, “Fair Value Measurement (Topic 820): Disclosure Framework – Changes to the Disclosure Requirements for Fair Value Measurement”. This ASU modifies the disclosure requirements on fair value measurements. The ASU removes the requirement to disclose: the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy; the policy for timing of transfers between levels; and the valuation processes for Level 3 fair value measurements. The adoption of this ASU on January 1, 2020 did not have a material impact on our condensed consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases”, which established ASC 842, Leases, which introduces a lessee model that brings most leases on the balance sheet and, among other changes, eliminates the requirement in current GAAP for an entity to use bright-line tests in determining lease classification. ASC 842 allows for several practical expedients which permit the following: no reassessment of lease classification or initial direct costs; use of the standard’s effective date as the date of initial application; and no separation of non-lease components from the related lease components and, instead, to account for those components as a single lease component if certain criteria are met. We elected these practical expedients, upon adoption, on January 1, 2019, using the effective date as our date of initial application and no transition adjustment was recognized. Therefore, financial information and disclosures under ASC 842 will not be provided for periods prior to January 1, 2019. The Company elected the practical expedient, among others, to not separate lease and non-lease components for all qualifying leases. For leases with a term of twelve months or less, the Company has made a policy election to not recognize lease liabilities and lease assets. Due to the new standard’s narrowed definition of initial direct costs, beginning January 1, 2019, the Company recognizes expense as incurred on certain lease origination costs previously capitalized and amortized to expense over the lease term. Any costs no longer qualifying as initial direct costs are an increase to property operating expenses in the condensed consolidated statements of operations and comprehensive income in the period of adoption and prospectively. As a lessee, beginning January 1, 2019, the Company recognized a right-of-use asset and lease liability included in deferred costs and other assets and other liabilities, respectively, with a balance as of March 31, 2020 , on the condensed consolidated balance sheets of approximately $296 , which was estimated by utilizing an average discount rate of approximately 4.5% , reflecting the Company's incremental borrowing rate. As a lessor, the Company believes that substantially all of the Company's leases will continue to be classified as operating leases under the new standard and will continue to record revenues from rental properties on a straight-line basis. However, certain ground, anchor, and other long-term leases entered into or acquired have an increased likelihood of being classified as either sales-type or finance-type leases. In June 2018, the FASB issued ASU No. 2018-07, “Compensation – Stock Compensation (Topic 718), Improvements to Nonemployee Share-Based Payment Accounting”. This ASU is intended to simplify aspects of share-based compensation issued to non-employees by making the guidance consistent with the accounting for employee share-based compensation. It is effective for annual reporting periods, and interim periods within those years, beginning after December 15, 2018. The adoption of ASU No. 2018-07 on January 1, 2019 did not have a material impact on our condensed consolidated financial statements. In December 2018, the FASB issued ASU 2018-20, “Leases (Topic 842): Narrow-Scope Improvements for Lessors,” which addresses specific issues in the leasing guidance, including sales taxes and other similar taxes collected from lessees, certain lessor costs paid directly by lessees, and recognition of variable payments for contracts with lease and non-lease components. Prior to the adoption of ASU 2018-20, the Company recognized tenant recovery income regardless of whether the third party was paid by the lessor or lessee. Effective January 1, 2019, such tenant recoveries are only recognized to the extent that the Company pays the third party directly and are classified as rental income on the Company’s condensed consolidated statements of operations and comprehensive loss.

Acquired Properties (Tables)

Acquired Properties (Tables)	3 Months Ended
	Mar. 31, 2020
Asset Acquisitions [Abstract]
Schedule of Real Estate Acquired	Property Location Acquisition Date Acquisition Price The Detroit and Detroit Terraces Denver, Colorado January 8, 2019 $ 19,070 The purchase price allocation has been recorded as follows: Land $ 3,370 Buildings and other improvements 15,006 Intangible assets, net 301 Total assets $ 18,677 Debt discount on mortgage assumption 393 Total liabilities $ 393 Total acquisition price $ 19,070

Disposed Properties (Tables)

Disposed Properties (Tables)	3 Months Ended
	Mar. 31, 2020
Discontinued Operations and Disposal Groups [Abstract]
Schedule of Disposal Group	The following table reflects the property dispositions during the three months ended March 31, 2020 . The Company recognized a net gain on sale of investment properties of $82 . Property Location Disposition Date Gross Disposition Price Sale Proceeds, Net Gain on Sale Citizens Providence, Rhode Island March 31, 2020 $ 1,425 $ 1,287 $ 82 There were no dispositions during the quarter ended March 31, 2019.

Leases (Tables)

Leases (Tables)	3 Months Ended
	Mar. 31, 2020
Leases [Abstract]
Lease Income	Lease income related to the Company's operating leases is comprised of the following: Three Months Ended March 31, 2020 2019 Lease income related to fixed lease payments $ 7,111 $ 8,203 Lease income related to variable lease payments 1,246 1,938 Other (1) 929 116 Lease income $ 9,286 $ 10,257 (1) For the three months ended March 31, 2020 and 2019, respectively, other is primarily comprised of parking revenues and termination fees related to early lease expirations.
Payments to be received under Topic 842	As of March 31, 2020, commercial operating leases provide for future minimum rental income, assuming no expiring leases are renewed, as follows. Apartment leases are not included as the terms are generally for one year or less. 2020 (remaining) $ 6,821 2021 8,566 2022 7,403 2023 6,803 2024 6,330 Thereafter 25,472 Total $ 61,395
Operating leases under Topic 840
Operating lease liability under Topic 842	The following table sets forth the undiscounted cash flows of our scheduled obligations for future minimum payments on our leases at March 31, 2020 and a reconciliation of those cash flows to the operating lease liability at March 31, 2020. 2020 (remaining) $ 148 2021 200 2022 21 2023 21 2024 21 Thereafter 373 784 Imputed interest (185 ) Lease liability $ 599

Accounts Payable and Accrued _2

Accounts Payable and Accrued Expenses (Tables)	3 Months Ended
	Mar. 31, 2020
Payables and Accruals [Abstract]
Schedule of Accounts Payable and Accrued Expenses	Accounts payable and accrued expenses consist of the following: March 31, 2020 December 31, 2019 Accrued real estate taxes $ 6,405 $ 6,372 Accrued compensation 1,242 3,606 Accrued interest payable 319 369 Other accrued expenses 1,528 1,188 $ 9,494 $ 11,535

Debt (Tables)

Debt (Tables)	3 Months Ended
	Mar. 31, 2020
Debt Disclosure [Abstract]
Schedule of Debt Outstanding	Total debt outstanding as of March 31, 2020 and December 31, 2019 was as follows: As of March 31, 2020 As of December 31, 2019 Debt, gross $ 94,670 94,926 Mortgage discount (336 ) (349 ) Deferred financing costs, net (1,310 ) (1,374 ) Total Debt, Net $ 93,024 $ 93,203
Scheduled Maturities of Mortgage Indebtedness	As of March 31, 2020 As of December 31, 2019 Debt, gross $ 94,670 94,926 Mortgage discount (336 ) (349 ) Deferred financing costs, net (1,310 ) (1,374 ) Total Debt, Net $ 93,024 $ 93,203 As of March 31, 2020 , scheduled maturities for the Company’s outstanding mortgage indebtedness and the credit facility had various due dates through August 2027, as follows: For the year ended December 31, As of March 31, 2020 Weighted average interest rate 2020 (remaining) $ — — % 2021 — — % 2022 9,114 5.24 % 2023 18,565 3.27 % (1) 2024 30,000 3.42 % Thereafter 36,991 4.38 % Total $ 94,670 3.94 % (1) See below for discussion of the swap agreement entered into with the mortgage loan obtained in connection with the acquisition of The Locale asset. The weighted average interest rate reflected is the strike rate.

Fair Value Measurements (Tables

Fair Value Measurements (Tables)	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Derivative Liabilities Measured On A Recurring Basis	The table below presents the fair value of the Company’s derivative financial instrument as well as its classification on the condensed consolidated balance sheets as of March 31, 2020 and December 31, 2019, respectively. March 31, 2020 Level 1 Level 2 Level 3 Total Derivative financial instruments designated as cash flow hedges: Classified as liabilities in “Other liabilities” $ — $ 732 $ — $ 732 December 31, 2019 Derivative financial instruments designated as cash flow hedges: Level 1 Level 2 Level 3 Total Classified as assets in “Deferred costs and other assets, net” $ — $ 21 $ — $ 21
Schedule of the Fair Value of Financial Instruments	The table below represents the fair value of financial instruments presented at carrying values in the condensed consolidated financial statements as of March 31, 2020 and as of December 31, 2019 . March 31, 2020 December 31, 2019 Carrying Value Estimated Fair Value Carrying Value Estimated Fair Value Debt $ 94,670 $ 90,193 $ 94,926 $ 94,934

Segment Reporting (Tables)

Segment Reporting (Tables)	3 Months Ended
	Mar. 31, 2020
Segment Reporting [Abstract]
Summary of Net Property Operations	The following table summarizes net property operations by segment for the three months ended March 31, 2020 . Total Net Lease Retail Multi-Tenant Multi-family Other Rental income $ 8,357 $ 1,140 $ 2,876 $ 699 $ 3,642 $ — Other property income 929 — — 768 161 — Total income 9,286 1,140 2,876 1,467 3,803 — Operating expenses 3,850 423 1,444 204 1,639 140 Net operating income (loss) $ 5,436 $ 717 $ 1,432 $ 1,263 $ 2,164 $ (140 ) Non-allocated expenses (a) (7,853 ) Other income and expenses (b) (894 ) Gain on sale of investment properties (c) 82 Net loss attributable to non-controlling interests 28 Net loss attributable to Highlands REIT, Inc. common stockholders $ (3,201 ) Balance Sheet Data Real estate assets, net (d) $ 312,784 $ 33,161 $ 65,469 $ 26,267 $ 178,935 $ 8,952 Non-segmented assets (e) 80,934 Total assets $ 393,718 Capital expenditures $ 112 $ — $ — $ — $ 112 $ — (a) Non-allocated expenses consists of general and administrative expenses and depreciation and amortization. (b) Other income and expenses consists of interest income and interest expense. (c) Gain on the sale of investment properties is related to one net lease asset. (d) Real estate assets include intangible lease assets, net of amortization. (e) Non-segmented assets include cash and cash equivalents, restricted cash and escrows, accounts and rents receivable and deferred costs and other assets. The following table summarizes net property operations by segment for the three months ended March 31, 2019 . Total Net Lease Retail Multi-Tenant Multi-family Other Rental income $ 10,141 $ 3,180 $ 4,992 $ 753 $ 1,216 $ — Other property income 116 — 21 — 95 — Total income 10,257 3,180 5,013 753 1,311 — Operating expenses 3,210 157 2,167 175 553 158 Net operating income (loss) $ 7,047 $ 3,023 $ 2,846 $ 578 $ 758 $ (158 ) Non-allocated expenses (a) (7,113 ) Other income and expenses (b) (389 ) Net loss $ (455 ) Balance Sheet Data Real estate assets, net (c) $ 258,284 $ 35,927 $ 113,941 $ 26,808 $ 72,130 $ 9,478 Non-segmented assets (d) 114,390 Total assets $ 372,674 Capital expenditures $ 118 $ — $ 95 $ 8 $ 15 $ — (a) Non-allocated expenses consists of general and administrative expenses and depreciation and amortization. (b) Other income and expenses consists of interest income and interest expense. (c) Real estate assets include intangible lease assets, net of amortization. (d) Non-segmented assets include cash and cash equivalents, restricted cash and escrows, accounts and rents receivable and deferred costs and other assets.

Earnings Per Share (Tables)

Earnings Per Share (Tables)	3 Months Ended
	Mar. 31, 2020
Earnings Per Share [Abstract]
Reconciliation of Net (Loss) Income to Basic and Diluted EPS	The following table reconciles net income attributable to the Company to basic and diluted EPS (in thousands, except share and per share data): Three Months Ended March 31, 2020 2019 Numerator: Net loss attributable to Highlands REIT, Inc. common stockholders $ (3,201 ) $ (455 ) Denominator: Weighted average number of common shares outstanding - basic and diluted 878,071,826 873,379,003 Basic and diluted earnings per share: Net loss per common share $ 0.00 $ 0.00

Share Based Compensation (Table

Share Based Compensation (Tables)	3 Months Ended
	Mar. 31, 2020
Share-based Payment Arrangement, Noncash Expense [Abstract]
Summary of Stock Award Activity	A summary of the Company's stock awards activity as of March 31, 2020 is as follows: Non-Vested stock awards Stock Awards Weighted Average Grant Date Fair Value Balance at January 1, 2020 357,143 $ 0.35 Granted 6,347,224 0.36 Vested (6,347,224 ) 0.36 Other (1) (9,921 ) — Balance at March 31, 2020 347,222 $ 0.36 (1) Represents the change in the number of shares granted in 2019 based on an estimated net asset value per share of $0.35 and the actual shares vesting in 2020 based on an estimated net asset value per share of $0.36

Organization (Details)

Organization (Details) $ / shares in Units, $ in Thousands	Aug. 16, 2019USD ($)	Apr. 28, 2016$ / sharesshares	Mar. 31, 2020parcelproperty$ / shares	Dec. 31, 2019parcelproperty$ / shares
Conversion of Stock [Line Items]
Common stock, par value (in dollars per share) | $ / shares		$ 0.01	$ 0.01	$ 0.01
Number of assets (in property) | property			19	20
Parcels of land | parcel			1	1
Common stock
Conversion of Stock [Line Items]
Shares issued for each share held at date of spin-off (in shares) | shares		1
Corvue Venture
Conversion of Stock [Line Items]
Ownership percentage	85.00%
Equity investment contributions | $	$ 9,000

Summary of Significant Accoun_3

Summary of Significant Accounting Policies - Additional Information (Details)	3 Months Ended
	Mar. 31, 2020USD ($)	Dec. 31, 2019USD ($)	Mar. 31, 2019USD ($)	Jan. 01, 2019USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Assets	$ 393,718,000	$ 400,232,000	$ 372,674,000
Liabilities	105,849,000	109,635,000
Assets held for sale		0
Restricted cash	3,402,000	2,651,000	$ 3,695,000
ASU 2016-02
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Cumulative effect of adoption				$ 92,000
ROU asset	$ 296,000
Buildings and improvements
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Useful life	30 years
Minimum | Furniture, Fixtures, Equipment and Site Improvements
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Useful life	5 years
Maximum | Furniture, Fixtures, Equipment and Site Improvements
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Useful life	15 years
Discount rate
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Measurement input	0.045
Primary Beneficiary
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Assets	$ 27,805,000	28,073,000
Liabilities	$ 19,770,000	$ 19,074,000

Acquired Properties - Additiona

Acquired Properties - Additional Information (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)building	Mar. 31, 2019USD ($)
Schedule of Asset Acquisitions, by Acquisition [Line Items]
Acquisition of investment properties	$ 0	$ 7,621
Multi-family
Schedule of Asset Acquisitions, by Acquisition [Line Items]
Number of properties acquired | building	2
Acquisition of investment properties	$ 19,070
Capitalized transaction costs	$ 70

Acquired Properties - Purchase

Acquired Properties - Purchase Price Allocation (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Real Estate [Line Items]
Land	$ 82,301		$ 82,877
Building and other improvements	288,534		289,351
Total	370,894		$ 372,228
Total acquisition price	0	$ 7,621
Multi-family
Real Estate [Line Items]
Total acquisition price	19,070
The Detroit and Detroit Terraces | Multi-family
Real Estate [Line Items]
Land	3,370
Building and other improvements	15,006
Intangible assets, net	301
Total	18,677
Debt discount on mortgage assumption	393
Total liabilities	393
Total acquisition price	$ 19,070

Disposed Properties - Narrative

Disposed Properties - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Discontinued Operations and Disposal Groups [Abstract]
Gain on sale of investment properties, net	$ 82	$ 0

Disposed Properties - Disposals

Disposed Properties - Disposals (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale Proceeds, Net	$ 1,287	$ 0
Gain on Sale	82	$ 0
Citizens
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Gross Disposition Price	1,425
Sale Proceeds, Net	1,287
Gain on Sale	$ 82

Leases - Narrative (Details)

Leases - Narrative (Details) $ in Thousands	3 Months Ended
	Mar. 31, 2020USD ($)leased_asset	Dec. 31, 2018USD ($)
Lessor, Lease, Description [Line Items]
Lease liability	$ 599
Number of leased assets | leased_asset	1
Impairment of asset		$ 3,765
Minimum
Lessor, Lease, Description [Line Items]
Lease terms	1 year
Maximum
Lessor, Lease, Description [Line Items]
Lease terms	10 years
ASU 2016-02
Lessor, Lease, Description [Line Items]
ROU asset	$ 296
Discount rate	4.50%
Customer concentration risk | Revenue | The GEO Group, Inc
Lessor, Lease, Description [Line Items]
Concentration percentage	6.60%

Leases - Lease Income (Details)

Leases - Lease Income (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Leases [Abstract]
Lease income related to fixed lease payments	$ 7,111	$ 8,203
Lease income related to variable lease payments	1,246	1,938
Other	929	116
Lease income	$ 9,286	$ 10,257

Leases - Receivable Maturity (D

Leases - Receivable Maturity (Details) $ in Thousands	Mar. 31, 2020USD ($)
Leases [Abstract]
2020	$ 6,821
2021	8,566
2022	7,403
2023	6,803
2024	6,330
Thereafter	25,472
Total	$ 61,395

Leases - Operating Lease Liabil

Leases - Operating Lease Liability Maturity (Details) $ in Thousands	Mar. 31, 2020USD ($)
Leases [Abstract]
2020	$ 148
2021	200
2022	21
2023	21
2024	21
Thereafter	373
Total	784
Imputed interest	(185)
Lease liability	$ 599

Accounts Payable and Accrued _3

Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Payables and Accruals [Abstract]
Accrued real estate taxes	$ 6,405	$ 6,372
Accrued compensation	1,242	3,606
Accrued interest payable	319	369
Other accrued expenses	1,528	1,188
Total accounts payable and accrued expenses	$ 9,494	$ 11,535

Debt - Outstanding Debt (Detail

Debt - Outstanding Debt (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Debt Disclosure [Abstract]
Debt, gross	$ 94,670	$ 94,926
Mortgage discount	(336)	(349)
Deferred financing costs, net	(1,310)	(1,374)
Total Debt, Net	$ 93,024	$ 93,203

Debt - Narrative (Details)

Debt - Narrative (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Debt, net	$ 93,024	$ 93,203
Deferred financing costs, net	$ 1,310	$ 1,374
Mortgages
Debt Instrument [Line Items]
Weighted average interest rate	3.94%

Debt - Scheduled Maturities (De

Debt - Scheduled Maturities (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Debt Instrument [Line Items]
Total	$ 94,670	$ 94,926
Mortgages
Debt Instrument [Line Items]
2019	0
2020	0
2021	9,114
2022	18,565
2023	30,000
Thereafter	36,991
Total	$ 94,670
Weighted average interest rate
2019	0.00%
2020	0.00%
2021	5.24%
2022	3.27%
2023	3.42%
Thereafter	4.38%
Total	3.94%

Debt - Additional Information (

Debt - Additional Information (Details) $ in Thousands	Feb. 15, 2019USD ($)extension_option	Jan. 08, 2019USD ($)
Line of Credit
Debt Instrument [Line Items]
Additional borrowing	$ 100,000
Line of Credit | Revolving Credit Facility
Debt Instrument [Line Items]
Principal amount	$ 50,000
Number of extension options | extension_option	2
Extension fee percentage	0.15%
Extension period	1 year
Line of Credit | Revolving Credit Facility | Minimum
Debt Instrument [Line Items]
Unused facility fee	0.15%
Line of Credit | Revolving Credit Facility | Maximum
Debt Instrument [Line Items]
Unused facility fee	0.25%
Line of Credit | Revolving Credit Facility | Base Rate | Minimum
Debt Instrument [Line Items]
Variable rate	1.00%
Line of Credit | Revolving Credit Facility | Base Rate | Maximum
Debt Instrument [Line Items]
Variable rate	1.30%
Line of Credit | Revolving Credit Facility | LIBOR | Minimum
Debt Instrument [Line Items]
Variable rate	2.00%
Line of Credit | Revolving Credit Facility | LIBOR | Maximum
Debt Instrument [Line Items]
Variable rate	2.30%
Line of Credit | Letter of Credit
Debt Instrument [Line Items]
Percentage of borrowings available	10.00%
Line of Credit | Revolving Credit Facility, Term Loan Commitments
Debt Instrument [Line Items]
Principal amount	$ 50,000
Proceeds from borrowings	$ 30,000
Unused facility fee	0.25%
Line of Credit | Revolving Credit Facility, Term Loan Commitments | Base Rate | Minimum
Debt Instrument [Line Items]
Variable rate	0.90%
Line of Credit | Revolving Credit Facility, Term Loan Commitments | Base Rate | Maximum
Debt Instrument [Line Items]
Variable rate	1.20%
Line of Credit | Revolving Credit Facility, Term Loan Commitments | LIBOR | Minimum
Debt Instrument [Line Items]
Variable rate	1.90%
Line of Credit | Revolving Credit Facility, Term Loan Commitments | LIBOR | Maximum
Debt Instrument [Line Items]
Variable rate	2.20%
The Detroit and Detroit Terraces
Debt Instrument [Line Items]
Debt assumed		$ 11,089
Debt discount on mortgage assumption		$ (360)
The Detroit and Detroit Terraces | Mortgages
Debt Instrument [Line Items]
Fixed rate		3.99%

Fair Value Measurements - Narra

Fair Value Measurements - Narrative (Details)	3 Months Ended
	Mar. 31, 2020USD ($)derivative_instrument	Mar. 31, 2019USD ($)	Dec. 31, 2019
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Unrealized loss on derivatives	$ 752,000	$ 0
Cash flow hedges to be reclassified in the next twelve months	$ 219,000
Discount rate | Long-term debt
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Measurement input percentage	0.0454		0.0393
Discount rate | Long-term debt | Minimum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Measurement input percentage	0.0274
Discount rate | Long-term debt | Maximum
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Measurement input percentage	0.0656
Cash Flow Hedging | Interest Rate Swap
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Number of derivative instruments | derivative_instrument	1
Notional amount	$ 18,750,000

Fair Value Measurements - Deriv

Fair Value Measurements - Derivative Liabilities (Details) - Recurring - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	$ 732	$ 21
Level 1
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	0	0
Level 2
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	732	21
Level 3
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Derivative liabilities	$ 0	$ 0

Fair Value Measurements - Not M

Fair Value Measurements - Not Measured at Fair Value (Details) - USD ($) $ in Thousands	Mar. 31, 2020	Dec. 31, 2019
Carrying Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt	$ 94,670	$ 94,926
Estimated Fair Value
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Debt	$ 90,193	$ 94,934

Income Taxes (Details)

Income Taxes (Details) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Income Tax Disclosure [Abstract]
Income tax benefit	$ 0	$ 0

Segment Reporting - Narrative (

Segment Reporting - Narrative (Details)	3 Months Ended
	Mar. 31, 2020segmentleased_asset
Concentration Risk [Line Items]
Number of business segments (in segments) | segment	4
Retail
Concentration Risk [Line Items]
Number of leased assets | leased_asset	1

Segment Reporting - Net Propert

Segment Reporting - Net Property Operations (Details) - USD ($) $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Segment Reporting Information [Line Items]
Total revenues	$ 9,286	$ 10,257
Operating expenses	3,850	3,210
Net operating income (loss)	5,436	7,047
Gain on sale of investment properties	82	0
Net loss attributable to non-controlling interests	28	0
Net income attributable to Highlands REIT, Inc. common stockholders	(3,201)	(455)
Total assets	393,718	372,674	$ 400,232
Capital expenditures	112	118
Rental income
Segment Reporting Information [Line Items]
Total revenues	8,357	10,141
Other property income
Segment Reporting Information [Line Items]
Total revenues	929	116
Other
Segment Reporting Information [Line Items]
Total revenues	0	0
Operating expenses	140	158
Net operating income (loss)	(140)	(158)
Total assets	8,952	9,478
Capital expenditures	0	0
Other | Rental income
Segment Reporting Information [Line Items]
Total revenues	0	0
Other | Other property income
Segment Reporting Information [Line Items]
Total revenues	0	0
Reconciling items
Segment Reporting Information [Line Items]
Non-allocated expenses	(7,853)	(7,113)
Other income and expenses	(894)	(389)
Total assets	80,934	114,390
Operating Segments And Corporate, Non-Segment
Segment Reporting Information [Line Items]
Total assets	312,784	258,284
Net Lease | Operating segments
Segment Reporting Information [Line Items]
Total revenues	1,140	3,180
Operating expenses	423	157
Net operating income (loss)	717	3,023
Total assets	33,161	35,927
Capital expenditures	0	0
Net Lease | Operating segments | Rental income
Segment Reporting Information [Line Items]
Total revenues	1,140	3,180
Net Lease | Operating segments | Other property income
Segment Reporting Information [Line Items]
Total revenues	0	0
Retail | Operating segments
Segment Reporting Information [Line Items]
Total revenues	2,876	5,013
Operating expenses	1,444	2,167
Net operating income (loss)	1,432	2,846
Total assets	65,469	113,941
Capital expenditures	0	95
Retail | Operating segments | Rental income
Segment Reporting Information [Line Items]
Total revenues	2,876	4,992
Retail | Operating segments | Other property income
Segment Reporting Information [Line Items]
Total revenues	0	21
Multi-Tenant Office | Operating segments
Segment Reporting Information [Line Items]
Total revenues	1,467	753
Operating expenses	204	175
Net operating income (loss)	1,263	578
Total assets	26,267	26,808
Capital expenditures	0	8
Multi-Tenant Office | Operating segments | Rental income
Segment Reporting Information [Line Items]
Total revenues	699	753
Multi-Tenant Office | Operating segments | Other property income
Segment Reporting Information [Line Items]
Total revenues	768	0
Multi-family | Operating segments
Segment Reporting Information [Line Items]
Total revenues	3,803	1,311
Operating expenses	1,639	553
Net operating income (loss)	2,164	758
Total assets	178,935	72,130
Capital expenditures	112	15
Multi-family | Operating segments | Rental income
Segment Reporting Information [Line Items]
Total revenues	3,642	1,216
Multi-family | Operating segments | Other property income
Segment Reporting Information [Line Items]
Total revenues	$ 161	$ 95

Earnings Per Share (Details)

Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Numerator:
Net income attributable to Highlands REIT, Inc. common stockholders	$ (3,201)	$ (455)
Denominator:
Weighted average shares outstanding - basic and diluted (in shares)	878,071,826	873,379,003
Basic and diluted earnings per share:
Net income per common share (in dollars per share)	$ 0	$ 0

Share Based Compensation (Detai

Share Based Compensation (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019	Apr. 28, 2016
Weighted Average Grant Date Fair Value
Unrecognized compensation expense	$ 28
Payment for tax withholding for share-based compensation	$ 1,090	$ 1,120
Incentive awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate value of shares granted		$ 2,035
Number of shares authorized to grant (up to) (in shares)				43,000,000
Shares available for future issuance (in shares)	11,118,213
Stock Awards
Beginning balance (in shares)	357,143
Granted (in shares)	6,347,224	5,814,286
Vested (in shares)	(6,347,224)
Forfeited (in shares)	(9,921)
Ending balance (in shares)	347,222		357,143
Weighted Average Grant Date Fair Value
Beginning balance (in dollars per share)	$ 0.35
Granted (in dollars per share)	0.36	$ 0.35	$ 0.35
Vested (in dollars per share)	0.36
Forfeited (in dollars per share)	0
Ending balance (in dollars per share)	$ 0.36		$ 0.35
Executive Officer | Incentive awards
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Aggregate value of shares granted	$ 125
Incentive Award Plan
Weighted Average Grant Date Fair Value
Stock-based compensation expense	$ 2,306	$ 2,536

Subsequent Events (Details)

Subsequent Events (Details) - USD ($) $ in Thousands	Apr. 22, 2020	Mar. 31, 2020	Mar. 31, 2019
Subsequent Event [Line Items]
Gross purchase price		$ 0	$ 7,621
Subsequent event
Subsequent Event [Line Items]
Gross purchase price	$ 7,300