Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Jul. 13, 2017 | Jun. 30, 2016 | |
Document Information [Line Items] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Dec. 31, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | Rich Uncles Real Estate Investment Trust I | ||
Entity Central Index Key | 1,672,754 | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | No | ||
Entity Filer Category | Smaller Reporting Company | ||
Entity Public Float | $ 8,276,045 | ||
Entity Common Stock, Shares Outstanding | 8,357,951 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Real estate investments: | ||
Land | $ 27,738,010 | $ 12,800,088 |
Buildings and improvements | 72,141,786 | 25,652,422 |
Tenant origination and absorption costs | 9,380,693 | 2,894,046 |
Total real estate investments, cost | 109,260,489 | 41,346,556 |
Accumulated depreciation and amortization | (3,797,990) | (713,268) |
Total real estate investments, net | 105,462,499 | 40,633,288 |
Cash and cash equivalents | 12,341,682 | 2,102,868 |
Restricted cash | 1,123,470 | 0 |
Cash held in escrow | 0 | 4,296,000 |
Above-market lease, net | 249,967 | 272,335 |
Distributions receivable from limited partnerships (Note 6) | 0 | 1,252,052 |
Due from affiliates | 48,950 | 8,662 |
Purchase and other deposits | 1,250,000 | 217,000 |
Interest rate swap derivatives | 180,759 | 0 |
Other assets | 750,243 | 137,150 |
TOTAL ASSETS | 121,407,570 | 48,919,355 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Mortgage notes payable, net | 38,705,103 | 6,197,946 |
Unsecured credit facility, net | 0 | 8,032,181 |
Accounts payable, accrued expenses and other liabilities | 923,249 | 507,314 |
Sales deposit liability (Note 5) | 1,000,000 | 0 |
Share repurchase payable | 592,511 | 261,312 |
Below-market lease, net | 4,841,757 | 770,685 |
Due to affiliates | 644,277 | 269,178 |
Interest rate swap derivatives | 106,840 | 0 |
TOTAL LIABILITIES | 46,813,735 | 16,038,616 |
Redeemable common stock | 1,229,644 | 0 |
Common stock $0.01 par value, 10,000,000, shares authorized, 8,249,204 shares issued and outstanding as of December 31, 2016 and 3,452,384 shares issued and outstanding as of December 31, 2015, | 82,492 | 34,524 |
Additional paid-in-capital | 80,637,051 | 34,277,669 |
Cumulative distributions and net losses | (7,355,354) | (1,431,454) |
TOTAL SHAREHOLDERS' EQUITY | 73,364,189 | 32,880,739 |
Commitments and contingencies (Note 11) | ||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ 121,407,570 | $ 48,919,355 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Dec. 31, 2016 | Dec. 31, 2015 |
Common Stock, Par or Stated Value Per Share | $ 0.01 | $ 0.01 |
Common Stock, Shares Authorized | 10,000,000 | 10,000,000 |
Common Stock, Shares, Issued | 8,249,204 | 3,452,384 |
Common Stock, Shares, Outstanding | 8,249,204 | 3,452,384 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue: | ||
Rental income | $ 5,549,034 | $ 962,151 |
Tenant recoveries | 865,558 | 16,036 |
Total revenue | 6,414,592 | 978,187 |
Expenses: | ||
Fees to affiliates (Note 10) | 1,212,698 | 73,200 |
General and administrative | 2,060,017 | 1,079,693 |
Depreciation and amortization | 3,134,979 | 768,122 |
Interest expense | 768,122 | 186,438 |
Property expenses | 994,503 | 61,591 |
Acquisition costs | 135,822 | 201,464 |
Total expenses | 8,306,141 | 2,370,507 |
Other income: | ||
Interest income | 161 | 1 |
Other non-operating income | 0 | 550,138 |
Total other income | 161 | 550,139 |
Net loss | $ (1,891,388) | $ (842,181) |
Net loss per share, basic and diluted | $ (0.28) | $ (0.59) |
Weighted-average number of common shares outstanding, basic and diluted | 6,692,800 | 1,435,926 |
Dividends declared per common share | $ 0.375 | $ 0.375 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) | Total | Common Stock [Member] | Additional Paid-in Capital [Member] | Cumulative Distributions and Net Losses [Member] |
Balance at Dec. 31, 2014 | $ 3,297,147 | $ 3,263 | $ 3,308,949 | $ (15,065) |
Balance (in shares) at Dec. 31, 2014 | 326,255 | |||
Issuance of common stock | 31,443,399 | $ 31,443 | 31,411,956 | 0 |
Issuance of common stock (in shares) | 3,144,340 | |||
Dividends declared | (574,208) | $ 0 | 0 | (574,208) |
Common stock awarded for services | 50,000 | $ 50 | 49,950 | 0 |
Common stock awarded for services (in shares) | 5,000 | |||
Repurchase of common stock | (232,106) | $ (232) | (231,874) | 0 |
Repurchase of common stock (in shares) | (23,211) | |||
Net loss | (842,181) | $ 0 | 0 | (842,181) |
Transfers to redeemable common stock | (261,312) | 0 | (261,312) | 0 |
Balance at Dec. 31, 2015 | 32,880,739 | $ 34,524 | 34,277,669 | (1,431,454) |
Balance (in shares) at Dec. 31, 2015 | 3,452,384 | |||
Issuance of common stock | 50,493,840 | $ 50,494 | 50,443,346 | 0 |
Issuance of common stock (in shares) | 5,049,384 | |||
Dividends declared | (4,032,512) | $ 0 | 0 | (4,032,512) |
Common stock awarded for services | 111,431 | $ 111 | 111,320 | 0 |
Common stock awarded for services (in shares) | 11,143 | |||
Repurchase of common stock | (2,637,071) | $ (2,637) | (2,634,434) | 0 |
Repurchase of common stock (in shares) | (263,707) | |||
Net loss | (1,891,388) | $ 0 | 0 | (1,891,388) |
Transfers to redeemable common stock | (1,560,849) | 0 | (1,560,849) | 0 |
Balance at Dec. 31, 2016 | $ 73,364,189 | $ 82,492 | $ 80,637,051 | $ (7,355,354) |
Balance (in shares) at Dec. 31, 2016 | 8,249,204 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (1,891,388) | $ (842,181) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization | 3,134,979 | 768,122 |
Common stock awarded for services | 111,431 | 50,000 |
Straight-line rents | (503,873) | (41,401) |
Amortization of deferred financing costs | 140,113 | 23,602 |
Amortization of above-market leases | 22,368 | 932 |
Amortization of below-market leases | (479,024) | (23,185) |
Gain on disposition of limited partnerships | 0 | (456,991) |
Distributions from earnings in limited partnerships | 21,193 | (21,193) |
Unrealized gain on interest rate swap | (73,919) | 0 |
Expensed organization and offering costs | 1,515,661 | 682,053 |
Expensed acquisition fees and costs | 913,689 | 225,121 |
Changes in operating assets and liabilities: | ||
Other assets | (159,090) | (41,508) |
Accounts payable, accrued expenses and other liabilities | 339,824 | 168,556 |
Due to affiliates | 236,963 | 108,807 |
Net cash provided by operating activities | 3,328,927 | 600,734 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Acquisition of real estate | (56,174,678) | (34,166,362) |
Payments of acquisition fees and costs | (1,411,714) | (225,121) |
Refundable purchase deposits | (7,676,321) | (2,700,000) |
Distributions of sales proceeds in limited partnerships | 1,230,858 | 0 |
Website development | 0 | (204,516) |
Net cash used in investing activities | (64,031,855) | (37,295,999) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Proceeds from mortgage note payable | 34,083,000 | 4,296,000 |
Cash held in escrow from mortgage financing | 4,296,000 | (4,296,000) |
Repayments of mortgage note payable | (318,858) | (33,376) |
Borrowings from unsecured credit facility | 0 | 16,154,959 |
Repayments of unsecured credit facility | (8,044,433) | (8,110,527) |
Payments of deferred financing costs | (1,273,392) | (14,560) |
Payments of offering costs | (1,501,355) | (501,287) |
Proceeds from sale of an interest in real property recorded as a financing transaction | 1,000,000 | 0 |
Proceeds from issuance of common stock | 47,593,708 | 31,493,066 |
Repurchase of common stock | (2,637,078) | (232,106) |
Dividends paid to common stock | (1,132,380) | (158,439) |
Net cash provided by financing activities | 72,065,212 | 38,597,730 |
NET INCREASE IN CASH, CASH EQUIVALENTS AND RESTRICTED CASH | 11,362,284 | 1,902,465 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF PERIOD | 2,102,868 | 200,403 |
CASH, CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD | 12,341,682 | 2,102,868 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid for interest | 605,172 | 107,294 |
SUPPLEMENTAL SCHEDULE OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ||
Transfers of redeemable common stock | 1,560,849 | 0 |
Increase in share repurchase payable | 331,198 | 0 |
Reinvested dividends from common shareholders | 2,900,132 | 415,769 |
Purchase deposits applied to acquisition of real estates | 6,626,321 | 2,500,000 |
Security deposits assumed and prorations from acquisitions | $ 520,811 | $ 299,853 |
BUSINESS AND ORGANIZATION
BUSINESS AND ORGANIZATION | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Business Description and Basis of Presentation [Text Block] | Rich Uncles Real Estate Investment Trust I (the “Company”) was formed on March 7, 2012. The Company is an unincorporated association under the laws of the State of California and is treated as a real estate investment trust (“REIT”). From April 2012 until July 20, 2016 (“Termination Date”), the Company was engaged in an offering of its shares of common stock for sale to investors. On July 20, 2016, the company ceased offering its shares for sale with the exception of shares sold to existing shareholders under the Company’s dividend reinvestment plan (the “Plan”). The number of shares authorized for issuance under the Company’s dividend reinvestment plan is 3,000,000 th The Company was formed to primarily invest, directly or indirectly through investments in real estate owning entities, in single-tenant income-producing corporate properties located 80% in California and 20% in other states, which are leased to creditworthy tenants under long-term net leases. The Company’s goal is to generate current income for investors and long-term capital appreciation in the value of its properties. The Company holds its investments directly and/or through special purpose wholly owned limited liability companies or other subsidiaries. The Company holds its 70.14 The Company is externally managed by its advisor and sponsor, Rich Uncles, LLC (the “Advisor” or the “Sponsor”) whose members include Harold Hofer, Howard Makler, and Ray Wirta. Rich Uncles LLC is a Delaware limited liability company registered to do business in California. The Company has entered into an agreement (the “Advisory Agreement”) with the Advisor. The current term of the Advisory Agreement ends on March 8, 2018. The Advisory Agreement may be renewed for an unlimited number of successive one-year periods upon the mutual consent of the Company and the Advisor. The Advisor may terminate the Advisory Agreement for any reason and without penalty upon 60 days’ written notice; and we may terminate the Advisory Agreement for cause as defined in the Advisory Agreement. Upon termination of the Advisory Agreement, the Advisor may be entitled to a termination fee. This agreement entitles the Advisor to specified fees upon the provision of certain services with regard to the investment of funds in real estate investments, the management of those investments, among other services, and the disposition of investments, as well as entitles the Advisor to reimbursement of organization and offering costs incurred by the Advisor or Sponsor on behalf of the Company, such as expenses related to the offering, and certain costs incurred by the Advisor in providing services to the Company. In addition, the Advisor is entitled to certain other fees, including an incentive fee upon achieving certain performance goals, as detailed in the Advisory Agreement. The Advisor Agreement is terminable by a majority of the Company’s independent board of trustees or the Advisor on 60 days’ written notice with or without cause. The Sponsor also serves as the sponsor for Rich Uncles NNN REIT, Inc. The Company elected to be taxed as a REIT for U.S. federal income tax purposes under Section 856 through 860 of the Internal Revenue Code of 1986, as amended, beginning with the year ended December 31, 2014. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | NOTE 2. SUMMARY OF SIGNIFICANT ACOUNTING POLICIES Basis of Presentation and Principles of Consolidation The consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC. The consolidated financial statements include the accounts of the Company and, wholly owned subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation. For all periods presented, other comprehensive loss is the same as net loss. Restricted Cash Restricted cash is comprised of funds which are restricted for use as required by certain lenders in conjunction with an acquisition or debt financing. Cash held in escrow represents the proceeds from mortgage notes payable that are in transit at the balance sheet date. Real Estate Investments Real Estate Acquisition Valuation The Company records acquisitions that meet the definition of a business as a business combination. If the acquisition does not meet the definition of a business, the Company records the acquisition as an asset acquisition. Under both methods, all assets acquired and liabilities assumed are measured based on their acquisition-date fair values. Transaction costs that are related to a business combination are charged to expense as incurred. Transaction costs that are related to an asset acquisition are capitalized as incurred. The Company assesses the acquisition date fair values of all tangible assets, identifiable intangibles, and assumed liabilities using methods similar to those used by independent appraisers, generally utilizing a discounted cash flow analysis that applies appropriate discount and/or capitalization rates and available market information. Estimates of future cash flows are based on a number of factors, including historical operating results, known and anticipated trends, and market and economic conditions. The fair value of tangible assets of an acquired property considers the value of the property as if it were vacant. The Company records above-market and below-market in-place lease values for acquired properties based on the present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining noncancelable term of above-market in-place leases and for the initial term plus any extended term for any leases with below-market renewal options. The Company amortizes any recorded above-market or below-market lease values as a reduction or increase, respectively, to rental income over the remaining noncancelable terms of the respective lease, including any below-market renewal periods. The Company estimates the value of tenant origination and absorption costs by considering the estimated carrying costs during hypothetical expected lease-up periods, considering current market conditions. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease up periods. The Company amortizes the value of tenant origination and absorption costs to amortization expense over the remaining noncancelable term of the respective lease. Estimates of the fair value of the tangible assets, identifiable intangibles and assumed liabilities require the Company to make significant assumptions to estimate market lease rates, property operating expenses, carrying costs during lease-up periods, discount rates, market absorption periods, and the number of years the property will be held for investment. Therefore, the Company classifies these inputs as Level 3 inputs. The use of inappropriate assumptions would result in an incorrect valuation of the Company’s acquired tangible assets, identifiable intangibles and assumed liabilities, which would impact the amount of the Company’s net income (loss). Depreciation and Amortization Real estate costs related to the acquisition and improvement of properties are capitalized and depreciated or amortized over the expected useful life of the asset on a straight-line basis. Repair and maintenance costs include all costs that do not extend the useful life of the real estate asset and are expensed as incurred. Significant replacements and betterments are capitalized. The Company anticipates the estimated useful lives of its assets by class to be generally as follows: · Buildings · 15 52 · Site/building improvements · 5 21 · Tenant improvements · 15 · Tenant origination and absorption costs, and above-/below-market lease intangibles · Impairment of Real Estate and Related Intangible Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of real estate and related intangible assets may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of real estate and related intangible assets may not be recoverable, management assesses whether the carrying value of the assets will be recovered through the future undiscounted operating cash flows expected from the use of and eventual disposition of the property. If, based on the analysis, the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment charge to the extent the carrying value exceeds the estimated fair value of the asset. As of December 31, 2016 and 2015, the Company did not record any impairment charges related to its real estate investments. Deferred financing costs represent commitment fees, financing coordination fees paid to Advisor, loan fees, legal fees, and other third-party costs associated with obtaining financing and are presented on the balance sheet as a direct deduction from the carrying value of the associated debt liability. These costs are amortized to interest expense over the terms of the respective financing agreements using the interest method. Unamortized deferred financing costs are generally expensed when the associated debt is refinanced or repaid before maturity unless specific rules are met that would allow for the carryover of such costs. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined that the financing will not close. Unamortized deferred financing costs related to revolving credit facilities are reclassified to presentation as an asset in periods where there are no outstanding borrowings under the facility. The Company recognizes rental income from tenants under operating leases on a straight-line basis over the noncancelable term of the lease when collectability of such amounts is reasonably assured. Recognition of rental income on a straight-line basis includes the effects of rental abatements, lease incentives and fixed and determinable increases in lease payments over the lease term. If the lease provides for tenant improvements, management of the Company determines whether the tenant improvements, for accounting purposes, are owned by the tenant or by the Company. When the Company is the owner of the tenant improvements, the tenant is not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements are substantially completed. When the tenant is the owner of the tenant improvements, any tenant improvement allowance (including amounts that the tenant can take in the form of cash or a credit against its rent) that is funded is treated as a lease incentive and amortized as a reduction of revenue over the lease term. Tenant improvement ownership is determined based on various factors including, but not limited to: · whether the lease stipulates how a tenant improvement allowance may be spent; · whether the amount of a tenant improvement allowance is in excess of market rates; · whether the tenant or landlord retains legal title to the improvements at the end of the lease term; · whether the tenant improvements are unique to the tenant or general-purpose in nature; and · whether the tenant improvements are expected to have any residual value at the end of the lease. Tenant reimbursements of real estate taxes, insurance, repairs and maintenance, and other operating expenses are recognized as revenue in the period the expenses are incurred and presented gross if the Company is the primary obligor and, with respect to purchasing goods and services from third-party suppliers, has discretion in selecting the supplier and bears the associated credit risk. The Company evaluates the collectability of rents and other receivables on a regular basis based on factors including, among others, payment history, the operations, the asset type, and current economic conditions. If the Company’s evaluation of these factors indicates it may not recover the full value of the receivable, it provides an allowance against the portion of the receivable that it estimates may not be recovered. This analysis requires the Company to determine whether there are factors indicating a receivable may not be fully collectable and to estimate the amount of the receivable that may not be collected. In addition, with respect to tenants in bankruptcy, management makes estimates of the expected recovery of pre-petition and post-petition claims in assessing the estimated collectability of the related receivable. In some cases, the ultimate resolution of these claims can exceed one year. When a tenant is in bankruptcy, the Company will record a bad debt allowance for the tenant’s receivable balance and generally will not recognize subsequent rental revenue until cash is received or until the tenant is no longer in bankruptcy and has the ability to make rental payments. The Company enters into derivative instruments for risk management purposes to hedge its exposure to cash flow variability caused by changing interest rates on its variable rate mortgage notes payable. The Company records these derivative instruments at fair value on the accompanying consolidated balance sheets. The company’s mortgage derivative instruments do not meet the hedge accounting criteria and therefore the changes in fair value are recorded as gain or loss on derivative instruments in the accompanying consolidated statement of operations. The gain or loss is included in interest expense. Under GAAP, the Company is required to measure certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other non-financial and financial assets at fair value on a non-recurring basis (e.g., carrying value of impaired long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories: Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable. When available, the Company utilizes quoted market prices from independent third-party sources to determine fair value and classifies such items in Level 1 or Level 2. In instances where the market for a financial instrument is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for a financial instrument owned by the Company to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal or external valuations, discounted cash flow analysis and quoted market prices) and establishes a fair value by assigning weights to the various valuation sources. Additionally, when determining the fair value of liabilities in circumstances in which a quoted price in an active market for an identical liability is not available, the Company measures fair value using (i) a valuation technique that uses the quoted price of the identical liability when traded as an asset or quoted prices for similar liabilities or similar liabilities when traded as assets or (ii) another valuation technique that is consistent with the principles of fair value measurement, such as the income approach or the market approach. Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument. The Company considers the following factors to be indicators of an inactive market: (i) there are few recent transactions, (ii) price quotations are not based on current information, (iii) price quotations vary substantially either over time or among market makers (for example, some brokered markets), (iv) indexes that previously were highly correlated with the fair values of the asset or liability are demonstrably uncorrelated with recent indications of fair value for that asset or liability, (v) there is a significant increase in implied liquidity risk premiums, yields, or performance indicators (such as delinquency rates or loss severities) for observed transactions or quoted prices when compared with the Company’s estimate of expected cash flows, considering all available market data about credit and other nonperformance risk for the asset or liability, (vi) there is a wide bid-ask spread or significant increase in the bid-ask spread, (vii) there is a significant decline or absence of a market for new issuances (that is, a primary market) for the asset or liability or similar assets or liabilities, and (viii) little information is released publicly (for example, a principal-to-principal market). The Company considers the following factors to be indicators of non-orderly transactions: (i) there was not adequate exposure to the market for a period before the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets or liabilities under current market conditions, (ii) there was a usual and customary marketing period, but the seller marketed the asset or liability to a single market participant, (iii) the seller is in or near bankruptcy or receivership (that is, distressed), or the seller was required to sell to meet regulatory or legal requirements (that is, forced), and (iv) the transaction price is an outlier when compared with other recent transactions for the same or similar assets or liabilities. The Company elected to be taxed as a REIT for U.S. federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, beginning with its taxable year ended December 31, 2014 and intends to operate as such. To qualify as a REIT, the Company must continue to meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the Company’s annual REIT taxable income to its shareholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, the Company generally will not be subject to federal income tax to the extent it distributes qualifying dividends to its shareholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Such an event could materially and adversely affect the Company’s net income and net cash available for distribution to shareholders. However, the Company intends to organize and operate in such a manner as to qualify for treatment as a REIT. The Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. Neither the Company nor its subsidiaries have been assessed interest or penalties by any major tax jurisdictions. The Company’s evaluations were performed for the tax years ended December 31, 2016 and 2015. As of December 31, 2016, the returns for calendar years 2014 and 2015 remain subject to examination by major tax jurisdictions. Real estate sales are accounted for in accordance with ASC 360. The Company intends, although is not legally obligated, to make regular quarterly distributions to holders of its shares at least at the level required to maintain REIT status unless the results of operations, general financial condition, general economic conditions or other factors inhibits the Company from doing so. Distributions are authorized at the discretion of the Company’s board of trust managers. th th Year ended December 31, 2016 December 31, 2015 Ordinary income $ 0.079 $ - Nontaxable dividend distribution $ 0.296 $ 0.375 $ 0.375 $ 0.375 Distributions declared per common share were $0.1875 per quarter for the years ended December 31, 2016 and 2015. The Company has adopted the Plan through which common shareholders may elect to reinvest any amount up to the distributions declared on their shares in additional shares of the Company’s common stock in lieu of receiving cash distributions. Participants in the Plan will acquire common stock at a price per share equal to the price to acquire a share of common stock in the offering. The initial price per share in the offering, and as of the date of these financial statements, 10.00 The Plan states that the Company will consider the offering stage complete when the Company is not offering equity securities, which occurred on July 20, 2016, and has not done so for eighteen months. The Company currently expects to update the estimated value per share every twelve to eighteen months thereafter We have a share repurchase program pursuant to which all of our shareholders are eligible to sell their shares back to us for any reason on a quarterly basis. Shareholders who wish to participate in the share repurchase program must notify our Advisor, in writing, no later than the 15th day of the last month of the then current calendar quarter of such shareholder’s desire to participate in the program and the number of shares that it wants to have repurchased by us. Any shareholder who elects to participate in the share repurchase program will receive a confirmation of its redemption of shares setting forth the number and price of the shares sold back to us, and the total number of shares remaining in such shareholder’s account, if any. In exchange for the shares redeemed by us from shareholders, we shall pay such shareholders a per share purchase price in cash equal to the lesser of (i) the net asset value per share, as calculated and published by our Advisor and (ii) the per share price paid for the shares by the redeeming shareholder. The share repurchase program will be funded by, and limited to, proceeds realized from our sale of shares under the Plan. We reserve the right to reject any request for the redemption of shares. Additionally, we may terminate, suspend or amend the share repurchase program at any time without shareholder approval if we believe such action is in the best interest of all shareholders or if we determine the funds otherwise available to fund our share repurchase program are needed for other purposes. Share repurchase requests will be made on a first-come, first served basis. We cannot guarantee that we will have sufficient available cash flow to accommodate all requests when made. If we do not have such sufficient funds available, at the time when redemption is requested, the redeeming shareholder may (i) withdraw their request for redemption or (ii) ask that we honor their request, if and when sufficient funds become available. Such pending requests will generally be honored on a first-come, first-serve basis. When the Company became a SEC reporting company on May 29, 2016, it became subject to the SEC’s regulation limiting the maximum amount of shares that can be repurchased to 5% of the weighted average outstanding shares for the past twelve months. The maximum dollar amount that the Company can be required to repurchase at the balance sheet date is recorded as redeemable common stock. Advertising costs relating to the offering are expensed as incurred. offering advertising costs expensed were $ 1,515,661 682,053 At December 31, 2016, with one exception, the Company invested in single-tenant income-producing properties. The Company’s real estate properties exhibit similar long-term financial performance and have similar economic characteristics to each other. As of December 31, 2016 and 2015, the Company aggregated its investments in real estate into one reportable segment. Basic earnings per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share of common stock equals basic earnings per share of common stock as there were no potentially dilutive securities outstanding for the years ended December 31, 2016 and 2015. The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. Square footage, occupancy and other measures used to describe real estate investments included in the Notes to Consolidated Financial Statements are presented on an unaudited basis. New Accounting Standards Issued and Adopted In April 2015, the FASB issued Accounting Standard Update (“ASU”) No. 2015-03, Interest Imputation of Interest (Subtopic 835-30) Interest - Imputation of Interest (Subtopic 835-30), Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements (Subtopic 205-40) Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments On October 1, 2016, the Company elected to early adopt the provisions of ASU 2016-15, and the standard was applied retrospectively for all periods presented. As a result of the adoption of ASU 2016-15, the Company classified organization and offering costs as financing activities and acquisition fees as investing activities. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue Recognition (Topic 605) Leases (Topic 840). Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) |
RESTATEMENT
RESTATEMENT | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Accounting Changes and Error Corrections [Text Block] | In connection with the preparation of its June 30, 2016 consolidated financial statements, the Company identified and corrected several errors in the December 31, 2015 audited financial statements that where primarily related to business combinations being accounted for as asset acquisitions, accruing dividends before their declaration date, accruing organization and offering costs in excess of the 3% limit, presenting discontinued operations when there was not a strategic shift, and recording share repurchases payable. We recognized the cumulative effect of the errors in periods prior to those that are presented herein by increasing total shareholders’ equity by $ 445,022 The Company also retrospectively The impact to certain captions in the December 31, 2015 consolidated financial statements is as follows: As Previously Reported Restated Balance Sheet $ Total real estate investments, net 40,527,230 $ 40,633,288 All other assets 8,000,804 8,286,067 Total assets $ 48,528,034 $ 48,919,355 Dividends payable $ 542,030 $ - Below-market leases, net - 770,685 Share repurchases payable - 261,312 Due to affiliates 753,888 269,178 All other liabilities 14,799,509 14,737,441 Total liabilities $ 16,095,427 $ 16,038,616 Common stock 34,582 34,524 Additional paid-in capital 34,721,362 341,277,669 Shareholders' distributions (1,214,135) - Treasury stock (232,106) - Cumulative distributions and net losses (877,096) (1,431,454) Total stockholders’ equity 32,432,607 32,880,739 Total liabilities and shareholders' equity $ 48,528,034 $ 48,919,355 Statement of Operations Total Revenue $ 976,982 $ 978,187 Depreciation and amortization 554,022 768,122 All other expenses 1,587,587 1,602,385 Total expenses 2,141,609 2,370,507 Other income 550,139 550,139 Net loss $ (614,488) $ (842,181) Net loss per share basic and diluted $ (0.43) $ (0.59) Statement of Cash Flows Net cash provided by operating activities $ 915,465 $ 600,734 Net cash provided by investing activities $ (41,930,547) $ (37,295,999) Net cash provided by financing activities 42,917,548 $ 38,597,730 |
REAL ESTATE INVESTMENTS
REAL ESTATE INVESTMENTS | 12 Months Ended |
Dec. 31, 2016 | |
Real Estate [Abstract] | |
Real Estate Disclosure [Text Block] | As of December 31, 2016 and 2015, the Company’s real estate portfolio consisted of twenty properties in three states consisting of eleven retail, seven office and two industrial properties. 2016 2015 Tenant Origination Accumulated Total Real Total Real Land, and Depreciation Estate Estate Acquisition Property Buildings and Absorption and Investments, Investments, Property Location Date Type Improvements Costs Amortization net net Chase Bank & Great Clips Antioch, CA 8/22/2014 Retail $ 3,160,035 $ 668,200 $ (759,854) $ 3,068,381 $ 3,388,320 Chevron Gas Station Rancho Cordova, CA 2/6/2015 Retail 2,600,000 - (135,450) 2,464,550 2,536,790 Chevron Gas Station San Jose, CA 5/29/2015 Retail 2,775,000 - (62,989) 2,712,011 2,750,773 Levins Sacramento, CA 8/19/2015 Industrial 3,750,000 - (292,708) 3,457,292 3,670,170 Chevron Gas Station Roseville, CA 9/30/2015 Retail 2,800,000 - (123,438) 2,676,562 2,772,127 Island Pacific Supermarket Elk Grove, CA 10/1/2015 Retail 3,151,460 568,540 (207,063) 3,512,937 3,684,300 Dollar General Bakersfield, CA 11/11/2015 Retail 4,632,567 689,020 (216,044) 5,105,543 5,297,582 Rite Aid Lake Elsinore, CA 12/7/2015 Retail 6,663,446 968,286 (248,521) 7,383,211 7,621,793 PMI Preclinical San Carlos, CA 12/9/2015 Office 8,920,000 - (214,169) 8,705,831 8,911,433 EcoThrift Sacramento, CA 3/17/2016 Retail 4,486,993 541,729 (191,746) 4,836,976 - GSA (MSHA) Vacaville, CA 4/5/2016 Office 2,998,232 456,645 (110,616) 3,344,261 - PreK San Antonio San Antonio, TX 4/8/2016 Retail 11,851,540 1,593,451 (646,790) 12,798,201 - Dollar Tree Morrow, GA 4/22/2016 Retail 1,248,156 206,844 (64,831) 1,390,169 - Dinan Cars Morgan Hill, CA 6/21/2016 Industrial 4,651,845 654,155 (205,957) 5,100,043 - ITW Ripley El Dorado, CA 8/18/2016 Office 6,178,204 407,316 (110,536) 6,474,984 - Solar Turbines San Diego, CA 7/21/2016 Office 5,481,198 389,718 (86,700) 5,784,216 - Amec Foster San Diego, CA 7/21/2016 Office 5,697,402 485,533 (89,453) 6,093,482 - Dollar General Big Spring Big Spring, TX 11/4/2016 Retail 1,161,647 112,958 (3,796) 1,270,809 - Gap Rocklin, CA 12/1/2016 Office 7,209,629 677,191 (13,308) 7,873,512 - L-3 Communications San Diego, CA 12/23/2016 Office 10,462,442 961,107 (14,021) 11,409,528 - $ 99,879,796 $ 9,380,693 $ (3,797,990) $ 105,462,499 $ 40,633,288 Current Period Acquisitions Land, building Tenant origination and and absorption Below-market Purchase Property improvements costs leases price EcoThrift $ 4,486,993 $ 541,729 $ (278,722) $ 4,750,000 GSA (MSHA) 2,998,232 456,645 (279,877) 3,175,000 PreK San Antonio 11,851,541 1,593,451 (2,594,992) 10,850,000 Dollar Tree 1,248,156 206,844 - 1,455,000 Dinan Cars 4,651,845 654,155 - 5,306,000 ITW Ripley 6,188,204 407,317 (144,521) 6,441,000 Solar Turbines 5,481,198 389,718 - 5,870,916 Amec Foster 5,697,402 485,533 - 6,182,935 Dollar General Big Spring 1,161,647 112,958 - 1,274,605 Gap 7,209,629 677,191 - 7,886,820 L-3 Communications 10,462,442 961,107 (1,251,985) 10,171,564 $ 61,437,289 $ 6,486,648 $ (4,550,097) $ 63,373,840 Purchase price $ 63,373,840 Purchase deposits applied (6,105,512) Security deposits assumed and prorations (520,811) Acquisition fees and costs capitalized (572,839) Cash paid for acquisition of real estate $ 56,174,678 The purchase price allocations reflected in the accompanying condensed consolidated financial statements are based upon estimates and assumptions that are subject to change within the measurement period for business combinations (up to one year from the acquisition date pursuant to ASC 805) that may impact the fair value of the assets and liabilities above (including real estate investments, other assets and accrued liabilities). Property Lease Expiration EcoThrift 2/28/2026 GSA (MSHA) 8/24/2026 PreK San Antonio 7/31/2021 Dollar Tree 7/31/2025 Dinan Cars 4/30/2023 ITW Ripley 8/1/2022 Solar Turbines 7/31/2021 Amec Foster 2/28/2021 Dollar General Big Spring 4/30/2030 Gap 2/28/2023 L-3 Communications 4/30/2022 During the year ended December 31, 2016, the Company recorded all properties acquired before October 1, 2016 as business combinations and expensed acquisition costs of $ 913,689 3,121,969 During the year ended December 31, 2016, the Company recorded all other properties acquired subsequent to October 1, 2016 as asset acquisitions and capitalized acquisition costs of $ 501,025 Operating Leases The Company’s real estate properties are primarily leased to tenants under triple-net leases for which terms and expirations vary. The Company monitors the credit of all tenants to stay abreast of any material changes in credit quality. The Company monitors tenant credit by (1) reviewing the credit ratings of tenants (or their parent companies or lease guarantors) that are rated by national recognized rating agencies; (2) reviewing financial statements and related metrics and information that are publicly available or that are required to be provided pursuant to the lease; (3) monitoring new reports and press releases regarding the tenants (or their parent companies or lease guarantors), and their underlying business and industry; and (4) monitoring the timeliness of rent collections. As of December 31, 2016, no tenant accounted for more than 11% of annualized base rent. For the year ended December 31, 2015, four of the Company’s tenants accounted for approximately 74% of total revenue. None of these tenants accounted for more than 10% of total revenue for the year ended December 31, 2016. For the year ended December 31, 2016, two of the company’s tenants accounted for approximately 29% of total revenue. No other tenant accounted for more than 10% of the total revenue. 2017 $ 7,597,184 2018 7,494,631 2019 7,620,310 2020 7,757,781 2021 6,725,087 Thereafter 16,087,878 $ 53,282,871 Intangibles 2016 2015 Tenant Tenant Origination Origination and Above- Below- and Absorption Market Market Absorption Above-Market Below-Market Costs Leases Leases Costs Leases Leases Cost $ 9,380,694 $ 273,267 $ (5,349,908) $ 2,894,045 $ 273,267 $ (799,812) Accumulated amortization (1,166,366) (23,300) 508,152 (482,308) (932) 29,128 Net amount $ 8,214,329 $ 249,967 $ (4,841,757) $ 2,411,737 $ 272,335 $ (770,685) The intangible assets and liabilities acquired in connection with these acquisitions have a weighted average amortization period as of the date of the acquisition of approximately 7.31 Tenant origination and Above- Below- absorption Market Market costs Leases Leases 2017 $ 1,424,201 $ 22,368 $ 840,392 2018 1,228,549 22,368 824,807 2019 1,228,549 22,368 824,807 2020 1,228,549 22,368 824,807 2021 1,110,269 22,368 632,183 Thereafter 1,994,211 138,127 894,760 $ 8,214,328 $ 249,967 $ 4,841,756 Weighted average remaining amortization period 7.16 years 11.15 years 4.8 years Pro Forma Financial Data (Unaudited) The following table summarizes, on an unaudited pro forma basis, the combined results of operations of the Company for the years ended December 3, 2016 and 2015. The Company acquired eleven properties during the year ended December 31, 2016. The following unaudited pro forma information for the years ended December 31, 2016 and 2015 has been prepared to give effect to the acquisitions as if the acquisitions had occurred on January 1, 2015. Year ended 2016 2015 Revenue $ 9,592,028 $ 8,267,664 Net income $ 429,412 $ 1,671,411 The unaudited pro forma information for the year ended December 31, 2016 and 2015, were adjusted to exclude acquisition fees and costs incurred of $ 913,689 0 |
SALE OF INTEREST IN REAL PROPER
SALE OF INTEREST IN REAL PROPERTY | 12 Months Ended |
Dec. 31, 2016 | |
Real Estate [Abstract] | |
Disposal Of Interest In Real Estate Property [Text Block] | NOTE 5. SALE OF INTEREST IN REAL PROPERTY In March 2016, the Company entered into a tenancy in common agreement and sold an undivided 29.86 1,000,000 45,530 |
DISTRIBUTIONS RECEIVABLE FROM L
DISTRIBUTIONS RECEIVABLE FROM LIMITED PARTNERSHIPS | 12 Months Ended |
Dec. 31, 2016 | |
Limited Liability Companies (LLCs) and Limited Partnerships (LPs) [Abstract] | |
Distributions Receivable From Limited Partnerships [Text Block] | NOTE 6. DISTRIBUTIONS RECEIVABLE FROM LIMITED PARTNERSHIPS In December 2015, the four Del Taco limited partnerships that the Company had invested in were liquidated as a result of selling all of the properties that they had invested in. The Company had an approximate three percentage limited partnership interest in each of the partnerships and accounted for them on the cost basis. In January 2016, the Company received a distribution of operating cash flow of $ 21,193 1,230,858 |
DEBT
DEBT | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Debt Disclosure [Text Block] | NOTE 7. DEBT Mortgage Notes Payable 2016 2015 Deferred Deferred Effective Principal Financing Net Principal Financing Net Contractual Interest Collateral Amount Costs Balance Amount Costs Balance Interest Rate Rate (1) Chase Bank & Great Clips $ 1,924,692 $ (34,073) $ 1,890,619 $ 1,958,505 $ (39,559) $ 1,918,946 4.37% 4.37 % Levins 2,212,470 (49,373) 2,163,097 $ 2,250,000 (8,500) $ 2,241,500 One-month LIBOR + 1.93% 3.74 % Island Pacific Supermarket 2,011,873 (47,655) 1,964,218 $ 2,046,000 (8,500) $ 2,037,500 One-month LIBOR + 1.93% 3.74 % Dollar General 2,480,276 (76,408) 2,403,868 - - - One-month LIBOR + 1.48% 3.38 % Rite Aid 3,907,849 (140,369) 3,767,480 - - - One-month LIBOR + 1.50% 3.25 % PMI Preclinical 4,394,926 (175,390) 4,219,536 - - - One-month LIBOR + 1.48% 3.38 % EcoThrift 2,825,628 (112,374) 2,713,254 - - - One-month LIBOR + 1.21% 2.96 % GSA 1,921,809 (86,474) 1,835,335 - - - One-month LIBOR + 1.25% 3.00 % PreK San Antonio 5,425,000 (287,794) 5,137,206 - - - 4.25% 4.25 % Dinan Cars 2,860,000 (202,635) 2,657,365 - - - One-month LIBOR + 2.27% 4.02 % ITW Ripley, Solar 10,054,125 (101,000) 9,953,125 - - - 3.35% 3.35 % $ 40,018,648 $ (1,313,545) $ 38,705,103 $ 6,254,505 $ (56,559) $ 6,197,946 (1) Contractual interest rate represents the interest rate in effect under the mortgage notes payable as of December 31, 2016. Effective interest rate is calculated as the actual interest rate in effect as of December 31, 2016 (consisting of the contractual interest rate and the effect of the interest rate swap, if applicable). For further information regarding the Company’s derivative instruments, see Note 8. The mortgage notes payable provide for monthly payments of principal and interest. The mortgage loans payable have balloon payments that are due at loan maturity. Pursuant to the terms of the mortgage note payable agreements, the Company is subject to certain financial loan covenants. The Company was in compliance with all terms and conditions of the mortgage loan agreements. 2017 $ 771,730 2018 806,171 2019 2,646,022 2020 820,867 2021 23,391,517 Thereafter 11,582,341 Total principal $ 40,018,648 Unsecured Credit Facility On January 13, 2015, 2015, the Company (“Borrower”), entered into a credit agreement (the “Unsecured Credit Agreement”) with Pacific Mercantile Bank (“Lender”). The line of credit was completely paid off in January 2016 and no amounts were drawn on the line after January 2016. The Company canceled its line of credit with Pacific Mercantile Bank in June 2016. Year ended December 31, 2016 2015 Mortgage Payable Interest expense (1) $ 616,617 $ 86,382 Amortization of deferred financing costs 127,865 12,332 Unrealized gain on interest rate swaps (see Note 8) (73,919) - Unsecured Credit Facility Interest expense incurred 39,779 67,859 Amortization of deferred financing costs 12,250 19,865 Sales Deposit Liability (see Note 5) 45,530 - Total interest expense $ 768,122 $ 186,438 (1) Includes $ 145,836 0 13,709 |
INTEREST RATE SWAP DERIVATIVES
INTEREST RATE SWAP DERIVATIVES | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities Disclosure [Text Block] | NOTE 8. INTEREST RATE SWAP DERIVATIVES The primary goal of the Company’s risk management practices related to interest rate risk is to prevent changes in interest rates from adversely impacting the Company’s ability to achieve its investment return objectives. The Company does not enter into derivatives for speculative purposes. The Company enters into interest rate swaps as a fixed rate payer to mitigate its exposure to rising interest rates on its variable rate notes payable. The value of interest rate swaps as a fixed rate payer to mitigate its exposure to rising interest rates on its variable rate mortgage notes payable. The value of interest rate swaps is primarily impacted by interest rates, market expectations about interest rates, and the remaining life of the instrument. In general, increases in interest rates, or anticipated increases in interest rates, will increase the value of the fixed rate payer position and decrease the value of the variable rate payer position. As the remaining life of the interest rate swap decreases, the value of both positions will generally move towards zero. During 2016, the Company (or wholly owned LLCs) entered into interest rate swap agreements with notional amounts relating to eight mortgage notes payable. The following table summarizes the notional amount and other information related to the Company’s interest rate swaps as of December 31, 2016. December 31, 2016 Weighted Weighted Derivative Number of Reference Rate as of Average Fixed Average Instruments Instruments Notional Amount (i) 12/31/2016 Pay Rate Remaining Term Interest Rate Swaps 8 $ 22,871,000 One-month LIBOR/Fixed at 1.21%-2.28% 3.28 % 4.17 years (i) The notional amount of the Company’s swaps are reduced monthly to correspond to the outstanding principal balance on the related mortgage. The maximum notional amount is shown above. The minimum notional amount (outstanding principal balance at the maturity date) is $ 22,614,830 December 31, 2016 Derivative Instrument Balance Sheet Location Number of Instruments Fair Value Interest Rate Swaps Assets: Interest rate swap derivatives, at fair value 5 $ 180,759 Interest Rate Swap Liability: Interest rate swap derivatives, at fair value 3 $ (106,840) The change in fair value of a derivative instrument that is not designated as a cash flow hedge is recorded as interest expense in the accompanying consolidated statements of operations. None of the Company’s derivatives at December 31, 2016 were designated as hedging instruments, therefore the net realized gain recognized on interest rate swaps of $ 73,919 |
FAIR VALUE DISCLOSURES
FAIR VALUE DISCLOSURES | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | NOTE 9. FAIR VALUE DISCLOSURES The fair value for certain financial instruments is derived using a combination of market quotes, pricing models, and other valuation techniques that involve significant management judgment. The price transparency of financial instruments is a key determinant of the degree of judgment involved in determining the fair value of the Company’s financial instruments. Financial instruments for which actively quoted prices or pricing parameters are available and for which markets contain orderly transactions will generally have a higher degree of price transparency than financial instruments for which markets are inactive or consist of non-orderly trades. The Company evaluates several factors when determining if a market is inactive or when market transactions are not orderly. The following is a summary of the methods and assumptions used by management in estimating the fair value of each class of financial instrument for which it is practicable to estimate the fair value: Cash and cash equivalents, restricted cash, cash held in escrow, restricted cash, due from affiliate, purchase and other deposits, other assets, and accounts payable, accrued expenses and other liabilities, sales deposit liability, share repurchase payable, and due to affiliate Derivative Instruments : The Company’s derivative instruments are presented at fair value on the accompanying consolidated balance sheet. The valuation of these instruments is determined using a proprietary model that utilizes observable inputs. As such, the Company classifies these inputs as Level 2 inputs. The proprietary model uses the contractual terms of the derivatives, including the period to maturity, as well as observable market-based inputs, including interest rate curves and volatility. The fair values of interest rate swaps are estimated using the market standard methodology of netting the discounted fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of interest rates (forward curves) derived from observable market interest rate curves. In addition, credit valuation adjustments, which consider the impact of any credit risks to the contracts, are incorporated in the fair values to account for potential nonperformance risk. Unsecured credit facility : The fair value of the Company’s unsecured credit facility approximates its carrying value as the interest rates are variable and the balances approximate their fair values due to the short maturities of this facility. Mortgage notes payable: The fair value of the Company’s mortgage notes payable is estimated using a discounted cash flow analysis based on management’s estimates of current market interest rates for instruments with similar characteristics, including remaining loan term, loan-to-value ratio, type of collateral and other credit enhancements. Additionally, when determining the fair value of liabilities in circumstances in which a quoted price in an active market for an identical liability is not available, the Company measures fair value using (i) a valuation technique that uses the quoted price of the identical liability when traded as an asset or quoted prices for similar liabilities or similar liabilities when traded as assets or (ii) another valuation technique that is consistent with the principles of fair value measurement, such as the income approach or the market approach. The Company classifies these inputs as Level 3 inputs. December 31, 2016 December 31, 2015 Face Value Carrying Value Fair Value Face Value Carrying Value Fair Value $ 40,018,648 $ 38,705,103 $ 38,153,219 $ 6,255,981 $ 6,197,946 $ 6,044,526 Disclosures of the fair values of financial instruments is based on pertinent information available to the Company as of the period end and requires a significant amount of judgment. Low levels of transaction volume for certain financial instruments have made the estimation of fair values difficult and, therefore, both the actual results and the Company’s estimate of value at a future date could be materially different. Quoted Prices in Active Significant Other Significant Markets for Identical Observable Inputs Unobservable Inputs Recurring Basis Total Assets (Level 1) (Level 2) (Level 3) Interest rate swap derivatives $ 73,918 $ - $ 73,918 $ - |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 10. RELATED PARTY TRANSACTIONS The costs incurred by the Company pursuant to the Advisory Agreement for the years ended December 31, 2016 and 2015 as well as the related amounts payable or receivable as of December 31, 2016 and 2015 are included in the table below. The amounts payable or receivable are presented in the audited condensed consolidated balance sheets as “Due to Affiliates” and “Due from Affiliates.” Year ended Year ended December December 31, 2016 December 31, 2016 31, 2015 December 31, 2015 Incurred Receivable Payable Incurred Receivable Payable Expensed: Acquisition fees $ 778,137 $ - $ - $ - * $ - $ - Asset management fees 404,561 - 43,993 73,200 - 73,200 Disposition fees 30,000 - - - - - Fees to affiliates 1,212,698 73,200 Property management fees ** 21,267 - 21,267 3,188 - 5,486 Reimbursable organizational and offering expenses 1,514,688 - 41,797 575,814 8,662 - Capitalized: Acquisition fees 375,391 48,950 - - - - Financing coordination fees 383,790 - 137,800 - - 42,960 Other: Due to advisor for costs advanced (2) 223,317 - 270,372 - - 47,055 Due to other - SSLFO (1) - - 100,477 - - 100,477 Due to NNN (2) 28,571 - 28,571 - - - $ 3,759,722 $ 48,950 $ 644,277 $ 652,202 $ 8,662 $ 269,178 * In lieu of the REIT paying acquisition fees, seller paid the acquisition fees through escrow. ** Property management fees are presented as property operating expenses. (1) These costs were incurred by SSLFO, an affiliate of the Sponsor, in connection with the organization and offering of the Company’s shares. (2) These costs were incurred in connection with the potential acquisition of a property by Rich Uncles NNN REIT Inc. The property was acquired by the Company. Therefore, the Company has a payable to Rich Uncles NNN REIT, Inc. Organization and Offering Costs During the Offering, pursuant to the Advisory Agreement, the Company is obligated to reimburse the Sponsor or its affiliates for organization and offering costs (as defined in the Advisory Agreement) paid by the Sponsor on behalf of the Company. The Company will reimburse the Sponsor for organizational and offering expenses up to 3.0% of gross offering proceeds. The Sponsor and affiliates will be responsible for any organization and offering costs related to the Offering to the extent they exceed 3.0% of gross offering proceeds from the Offering. As of December 31, 2016, the Sponsor has incurred organization and offering expenses of $ 3,424,663 As of December 31, 2016 and 2015, the Company has reimbursed the Sponsor $ 2,514,070 $ 1,051,341 and offering costs. 2,555,866 and $ 1,041,178 41,797 8,662 Acquisition Fees The Company shall pay the Advisor a fee in the amount equal 3.0 6.0 Asset Management Fee The Company shall pay to the Advisor as compensation for the advisory services rendered to the Company, a monthly fee in an amount equal to 0.05 Financing Coordination Fee Other than with respect to any mortgage or other financing related to a property concurrent with its acquisition, if an Advisor or an Affiliate provides a substantial amount of the services (as determined by a majority of the Independent Directors) in connection with the post-acquisition financing or refinancing of any debt that the Company obtains relative to a Property, then the Company shall pay to the Advisor or such Affiliate a financing coordination fee equal to 1.0 Property Management Fees If an Advisor or an Affiliate provides a substantial amount of the property management services (as determined by a majority of the Independent Directors) for the Company’s Properties, then Company shall pay to the Advisor or such affiliate a property management fee equal to 1.5 Disposition Fees For substantial assistance in connection with the sale of Properties, the Company shall pay to its Advisor or one of its Affiliates 3.0 6 Leasing Commission Fees If an Advisor or an Affiliate provides a substantial amount of the services (as determined by a majority of the Independent Directors) in connection with the Company’s leasing of a Property or Properties to unaffiliated third parties, then the Company shall pay to the Advisor or such Affiliate leasing commissions equal to 6.0% of the rents due pursuant to such lease for the first ten years of the lease term; provided, however (i) if the term of the lease is less than ten years, such commission percentage will apply to the full term of the lease and (ii) any rents due under a renewal of a lease of an existing tenant upon expiration of the initial lease agreement (including any extensions provided for thereunder) shall accrue a commission of 3.0 6.0 Other Operating Expense Reimbursement Under the prospectus, total operating expenses of the Company are limited to the greater of 2 25 Operating expense reimbursements for the four fiscal quarters ended December 31, 2016 did not exceeded the 2%/25% Limitation. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Dec. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | NOTE 11. COMMITMENTS AND CONTINGENCIES Economic Dependency The Company depends on the Sponsor and the Advisor for certain services that are essential to the Company, including the sale of the Company’s shares of common stock, the identification, evaluation, negotiation, origination, acquisition and disposition of investments; management of the daily operations of the Company’s investment portfolio; and other general and administrative responsibilities. In the event that these companies are unable to provide the respective services, the Company will be required to obtain such services from other sources. Environmental As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. Although there can be no assurance, the Company is not aware of any environmental liability that could have a material adverse effect on its financial condition or results of operations. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s Properties, the activities of its tenants and other environmental conditions of which the Company is unaware with respect to the Properties could result in future environmental liabilities. Tenant Improvements Pursuant to lease agreement, the Company has an obligation to pay for $ 1,845,970 1,123,470 Legal Matters From time to time, the Company may become party to legal proceedings that arise in the ordinary course of its business. Other than the below, the Company is not a party to any legal proceeding, nor is the Company aware of any pending or threatened litigation that would have a material adverse effect on the Company’s business, operating results, cash flows or financial condition should such litigation be resolved unfavorably. |
SELECTED QUARTERLY FINANCIAL DA
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information [Text Block] | NOTE 12. SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) 2016 First Quarter Second Quarter Third Quarter Fourth Quarter Revenue $ 813,083 $ 1,440,457 $ 1,909,708 $ 2,251,344 Net income (loss) (1,155,929) (1,245,064) (120,874) 630,479 Net income (loss) per common share, basic and diluted (0.27) (0.20) (0.01) 0.08 Distributions declared per common share 0.1875 0.1875 0.1875 0.1875 2015 First Quarter Second Quarter Third Quarter Fourth Quarter Revenue $ 123,147 $ 168,914 $ 228,014 $ 458,112 Net loss (352,874) (205,154) (150,401) (133,752) Net loss per common share, basic and diluted (1.09) (0.25) (0.09) (0.05) Distributions declared per common share 0.1875 0.1875 0.1875 0.1875 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Dec. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | NOTE 13. SUBSEQUENT EVENTS The Company evaluates subsequent events up until the date the consolidated financial statements are issued. Distributions On January 20, 2017 0.0020380 1,548,589 January 20, 2017 1,092,631 On April 20, 2017 0.0020833 1,559,038 April 20, 2017 1,086,992 Acquisitions On March 15, 2017, through a wholly owned subsidiary, the Company acquired a 106,592 27,000,000 602,523 On June 29, 2017, through a wholly owned subsidiary, the Company acquired a 14,490 5,125,000 125,040 3,298,019 Debt Financing On March 9, 2017, the Company obtained a $ 14,850,000 4.5 March 9, 2024 On March 14, 2017, the Company obtained a $ 638,012 4.69 March 13, 2022 On March 28, 2017, the Company obtained a $ 5,527,600 4.5 April 1, 2022 Property Sale On April 27, 2017, the Company sold the Chevron Gas Station property in Rancho Cordova, CA to a third party for $ 3,434,000 800,000 Redeemable common stock For the period from January 1, 2017 through July 13, 2017, the Company redeemed 114,201 shares for $1,142,010. Legal Matters The U.S. Securities and Exchange Commission (the “SEC”) is conducting an investigation related to the advertising and sale of securities by the Company in connection with the offering. The investigation is a non-public fact finding inquiry. It is neither an allegation of wrongdoing nor a finding that violations of law have occurred. In connection with the investigation, the Company and certain affiliates have received and responded to subpoenas from the SEC requesting documents and other information related to the Company and the Offering. The SEC’s investigation is ongoing. The Company has cooperated and intends to continue to cooperate with the SEC in this matter. The Company is unable to predict the likely outcome of the investigation or determine its potential impact, if any, on the Company. |
Schedule III-Real Estate Assets
Schedule III-Real Estate Assets and Accumulated Depreciation and Amortization | 12 Months Ended |
Dec. 31, 2016 | |
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | |
SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Text Block] | Rich Uncles Real Estate Investment Trust I Schedule III Real Estate Assets and Accumulated Depreciation and Amortization December 31, 2016 Initial Cost to Company Gross Amount at which Carried at Close of Period Costs Capitalized Accumulated Original Subsequent Depreciation Ownership Year of Date Buildings and to Buildings and and Description Location Percent Construction Acquired Encumbrances Land Improvements (1) Total Acquisition Land Improvements (1) Total Amortization Net Chase Bank & Great Clips Antioch, CA 100 % 1998 8/22/2014 $ 1,924,692 $ 649,633 $ 3,178,602 $ 3,828,235 $ - $ 649,633 $ 3,178,602 $ 3,828,235 $ (759,854) $ 3,068,381 Chevron Gas Station Rancho Cordova, CA 100 % 1991 2/6/2015 - 937,863 1,662,137 2,600,000 - $ 937,863 1,662,137 $ 2,600,000 (135,450) $ 2,464,550 Chevron Gas Station San Jose, CA 100 % 1964 5/29/2015 - 1,844,383 930,617 2,775,000 - $ 1,844,383 930,617 $ 2,775,000 (62,989) $ 2,712,011 Levins Sacramento, CA 100 % 1970 8/19/2015 2,212,470 598,913 3,151,087 3,750,000 - $ 598,913 3,151,087 $ 3,750,000 (292,708) $ 3,457,292 Chevron Gas Station (2) Roseville, CA 100 % 2003 9/30/2015 - 602,375 2,197,625 2,800,000 - $ 602,375 2,197,625 $ 2,800,000 (123,438) $ 2,676,562 Island Pacific Supermarket Elk Grove, CA 100 % 2012 10/1/2015 2,011,873 958,328 2,761,672 3,720,000 - $ 958,328 2,761,672 $ 3,720,000 (207,063) $ 3,512,937 Dollar General Bakersfield, CA 100 % 1952 11/11/2015 2,480,276 2,218,862 3,102,725 5,321,587 - $ 2,218,862 3,102,725 $ 5,321,587 (216,044) $ 5,105,543 Rite Aid Lake Elsinore, CA 100 % 2008 12/7/2015 3,907,849 2,049,596 5,582,136 7,631,732 - $ 2,049,596 5,582,136 $ 7,631,732 (248,521) $ 7,383,211 PMI Preclinical San Carlos, CA 100 % 1974 12/9/2015 4,394,926 2,940,133 5,979,867 8,920,000 - $ 2,940,133 5,979,867 $ 8,920,000 (214,169) $ 8,705,831 EcoThrift Sacramento, CA 100 % 1982 3/17/2016 2,825,628 1,594,857 3,433,865 5,028,722 - $ 1,594,857 3,433,865 $ 5,028,722 (191,746) $ 4,836,976 GSA (MSHA) Vacaville, CA 100 % 1987 4/5/2016 1,921,809 286,380 3,168,497 3,454,877 - $ 286,380 3,168,497 $ 3,454,877 (110,616) $ 3,344,261 PreK San Antonio San Antonio, TX 100 % 2014 4/8/2016 5,425,000 509,476 12,935,515 13,444,991 - $ 509,476 12,935,515 $ 13,444,991 (646,790) $ 12,798,201 Dollar Tree Morrow, GA 100 % 1997 4/22/2016 - 255,989 1,199,011 1,455,000 - $ 255,989 1,199,011 $ 1,455,000 (64,831) $ 1,390,169 Dinan Cars Morgan Hill, CA 100 % 2001 6/21/2016 2,860,000 724,994 4,581,006 5,306,000 - $ 724,994 4,581,006 $ 5,306,000 (205,957) $ 5,100,043 ITW Ripley El Dorado, CA 100 % 1998 8/18/2016 3,552,247 429,668 6,155,852 6,585,520 - $ 429,668 6,155,852 $ 6,585,520 (110,536) $ 6,474,984 Solar Turbines San Diego, CA 100 % 1985 7/21/2016 3,166,787 3,081,330 2,789,586 5,870,916 - $ 3,081,330 2,789,586 $ 5,870,916 (86,700) $ 5,784,216 Amec Foster San Diego, CA 100 % 1985 7/21/2016 3,335,091 3,551,615 2,631,320 6,182,935 - $ 3,551,615 2,631,320 $ 6,182,935 (89,453) $ 6,093,482 Dollar General Big Spring Big Spring, TX 100 % 2015 11/4/2016 - 337,204 937,401 1,274,605 - $ 337,204 937,401 $ 1,274,605 (3,796) $ 1,270,809 Gap Rocklin, CA 100 % 1998 12/1/2016 - 1,661,831 6,224,989 7,886,820 - $ 1,661,831 6,224,989 $ 7,886,820 (13,308) $ 7,873,512 L-3 Communications San Diego, CA 100 % 1984 12/23/2016 - 2,504,578 8,918,971 11,423,549 - $ 2,504,578 8,918,971 $ 11,423,549 (14,021) $ 11,409,528 $ 40,018,648 $ 27,738,008 $ 81,522,481 $ 109,260,489 $ - $ 27,738,008 $ 81,522,481 $ 109,260,489 $ (3,797,990) $ 105,462,499 (1) Building and improvements include tenant origination and absorption costs (2) The Company owns an undivided 70.14% interest through a tenancy in common agreement that was entered into in March 2016. (3) The aggregate cost of real estate for federal income tax purposes was approximately $ 109,533,758 (4) Real estate investments (excluding land) are depreciated over their estimated useful lives. Their useful lives are generally 15 52 5 21 15 (5) The following table summarizes our real estate and accumulated depreciation and amortization for the years ended December 31: 2016 2015 Real estate investments: Balance at beginning of year $ 41,346,556 $ 3,828,237 Acquisitions 67,913,933 37,518,319 Balance at end of year $ 109,270,489 $ 41,346,556 Accumulated depreciation and amortization: Balance at beginning of year $ (713,268) $ (145,056) Depreciation and amortization expense (3,084,722) (568,212) Balance at end of year $ (3,797,990) $ (713,268) Real estate investments, net: $ 105,472,499 $ 40,633,288 The reconciliation 2016 2015 Real estate depreciation and amortization $ 3,084,722 $ 538,212 Website amortization 50,257 200,226 $ 3,134,979 $ 768,438 |
SUMMARY OF SIGNIFICANT ACCOUN21
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Consolidation, Policy [Policy Text Block] | Basis of Presentation and Principles of Consolidation The consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC. The consolidated financial statements include the accounts of the Company and, wholly owned subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation. |
Comprehensive Income, Policy [Policy Text Block] | Other Comprehensive Income For all periods presented, other comprehensive loss is the same as net loss. |
Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash Restricted cash is comprised of funds which are restricted for use as required by certain lenders in conjunction with an acquisition or debt financing. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Cash held in Escrow Cash held in escrow represents the proceeds from mortgage notes payable that are in transit at the balance sheet date. |
Real Estate, Policy [Policy Text Block] | Real Estate Investments Real Estate Acquisition Valuation The Company records acquisitions that meet the definition of a business as a business combination. If the acquisition does not meet the definition of a business, the Company records the acquisition as an asset acquisition. Under both methods, all assets acquired and liabilities assumed are measured based on their acquisition-date fair values. Transaction costs that are related to a business combination are charged to expense as incurred. Transaction costs that are related to an asset acquisition are capitalized as incurred. The Company assesses the acquisition date fair values of all tangible assets, identifiable intangibles, and assumed liabilities using methods similar to those used by independent appraisers, generally utilizing a discounted cash flow analysis that applies appropriate discount and/or capitalization rates and available market information. Estimates of future cash flows are based on a number of factors, including historical operating results, known and anticipated trends, and market and economic conditions. The fair value of tangible assets of an acquired property considers the value of the property as if it were vacant. The Company records above-market and below-market in-place lease values for acquired properties based on the present value (using a discount rate that reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) management’s estimate of fair market lease rates for the corresponding in-place leases, measured over a period equal to the remaining noncancelable term of above-market in-place leases and for the initial term plus any extended term for any leases with below-market renewal options. The Company amortizes any recorded above-market or below-market lease values as a reduction or increase, respectively, to rental income over the remaining noncancelable terms of the respective lease, including any below-market renewal periods. The Company estimates the value of tenant origination and absorption costs by considering the estimated carrying costs during hypothetical expected lease-up periods, considering current market conditions. In estimating carrying costs, the Company includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease up periods. The Company amortizes the value of tenant origination and absorption costs to amortization expense over the remaining noncancelable term of the respective lease. Estimates of the fair value of the tangible assets, identifiable intangibles and assumed liabilities require the Company to make significant assumptions to estimate market lease rates, property operating expenses, carrying costs during lease-up periods, discount rates, market absorption periods, and the number of years the property will be held for investment. Therefore, the Company classifies these inputs as Level 3 inputs. The use of inappropriate assumptions would result in an incorrect valuation of the Company’s acquired tangible assets, identifiable intangibles and assumed liabilities, which would impact the amount of the Company’s net income (loss). Depreciation and Amortization Real estate costs related to the acquisition and improvement of properties are capitalized and depreciated or amortized over the expected useful life of the asset on a straight-line basis. Repair and maintenance costs include all costs that do not extend the useful life of the real estate asset and are expensed as incurred. Significant replacements and betterments are capitalized. The Company anticipates the estimated useful lives of its assets by class to be generally as follows: ⋅ Buildings ⋅ 15 52 ⋅ Site/building improvements ⋅ 5 21 ⋅ Tenant improvements ⋅ 15 ⋅ Tenant origination and absorption costs, and above-/below-market lease intangibles ⋅ Impairment of Real Estate and Related Intangible Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of real estate and related intangible assets may not be recoverable. When indicators of potential impairment are present that indicate that the carrying amounts of real estate and related intangible assets may not be recoverable, management assesses whether the carrying value of the assets will be recovered through the future undiscounted operating cash flows expected from the use of and eventual disposition of the property. If, based on the analysis, the Company does not believe that it will be able to recover the carrying value of the asset, the Company will record an impairment charge to the extent the carrying value exceeds the estimated fair value of the asset. As of December 31, 2016 and 2015, the Company did not record any impairment charges related to its real estate investments. |
Deferred Charges, Policy [Policy Text Block] | Deferred Financing Costs Deferred financing costs represent commitment fees, financing coordination fees paid to Advisor, loan fees, legal fees, and other third-party costs associated with obtaining financing and are presented on the balance sheet as a direct deduction from the carrying value of the associated debt liability. These costs are amortized to interest expense over the terms of the respective financing agreements using the interest method. Unamortized deferred financing costs are generally expensed when the associated debt is refinanced or repaid before maturity unless specific rules are met that would allow for the carryover of such costs. Costs incurred in seeking financing transactions that do not close are expensed in the period in which it is determined that the financing will not close. Unamortized deferred financing costs related to revolving credit facilities are reclassified to presentation as an asset in periods where there are no outstanding borrowings under the facility. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition The Company recognizes rental income from tenants under operating leases on a straight-line basis over the noncancelable term of the lease when collectability of such amounts is reasonably assured. Recognition of rental income on a straight-line basis includes the effects of rental abatements, lease incentives and fixed and determinable increases in lease payments over the lease term. If the lease provides for tenant improvements, management of the Company determines whether the tenant improvements, for accounting purposes, are owned by the tenant or by the Company. When the Company is the owner of the tenant improvements, the tenant is not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements are substantially completed. When the tenant is the owner of the tenant improvements, any tenant improvement allowance (including amounts that the tenant can take in the form of cash or a credit against its rent) that is funded is treated as a lease incentive and amortized as a reduction of revenue over the lease term. Tenant improvement ownership is determined based on various factors including, but not limited to: ⋅ whether the lease stipulates how a tenant improvement allowance may be spent; ⋅ whether the amount of a tenant improvement allowance is in excess of market rates; ⋅ whether the tenant or landlord retains legal title to the improvements at the end of the lease term; ⋅ whether the tenant improvements are unique to the tenant or general-purpose in nature; and ⋅ whether the tenant improvements are expected to have any residual value at the end of the lease. Tenant reimbursements of real estate taxes, insurance, repairs and maintenance, and other operating expenses are recognized as revenue in the period the expenses are incurred and presented gross if the Company is the primary obligor and, with respect to purchasing goods and services from third-party suppliers, has discretion in selecting the supplier and bears the associated credit risk. The Company evaluates the collectability of rents and other receivables on a regular basis based on factors including, among others, payment history, the operations, the asset type, and current economic conditions. If the Company’s evaluation of these factors indicates it may not recover the full value of the receivable, it provides an allowance against the portion of the receivable that it estimates may not be recovered. This analysis requires the Company to determine whether there are factors indicating a receivable may not be fully collectable and to estimate the amount of the receivable that may not be collected. In addition, with respect to tenants in bankruptcy, management makes estimates of the expected recovery of pre-petition and post-petition claims in assessing the estimated collectability of the related receivable. In some cases, the ultimate resolution of these claims can exceed one year. When a tenant is in bankruptcy, the Company will record a bad debt allowance for the tenant’s receivable balance and generally will not recognize subsequent rental revenue until cash is received or until the tenant is no longer in bankruptcy and has the ability to make rental payments. |
Derivatives, Reporting of Derivative Activity [Policy Text Block] | Derivative Instruments The Company enters into derivative instruments for risk management purposes to hedge its exposure to cash flow variability caused by changing interest rates on its variable rate mortgage notes payable. The Company records these derivative instruments at fair value on the accompanying consolidated balance sheets. The company’s mortgage derivative instruments do not meet the hedge accounting criteria and therefore the changes in fair value are recorded as gain or loss on derivative instruments in the accompanying consolidated statement of operations. The gain or loss is included in interest expense. |
Fair Value Measurement, Policy [Policy Text Block] | Fair Value Measurements and Disclosures Under GAAP, the Company is required to measure certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other non-financial and financial assets at fair value on a non-recurring basis (e.g., carrying value of impaired long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories: Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable. When available, the Company utilizes quoted market prices from independent third-party sources to determine fair value and classifies such items in Level 1 or Level 2. In instances where the market for a financial instrument is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for a financial instrument owned by the Company to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal or external valuations, discounted cash flow analysis and quoted market prices) and establishes a fair value by assigning weights to the various valuation sources. Additionally, when determining the fair value of liabilities in circumstances in which a quoted price in an active market for an identical liability is not available, the Company measures fair value using (i) a valuation technique that uses the quoted price of the identical liability when traded as an asset or quoted prices for similar liabilities or similar liabilities when traded as assets or (ii) another valuation technique that is consistent with the principles of fair value measurement, such as the income approach or the market approach. Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument. The Company considers the following factors to be indicators of an inactive market: (i) there are few recent transactions, (ii) price quotations are not based on current information, (iii) price quotations vary substantially either over time or among market makers (for example, some brokered markets), (iv) indexes that previously were highly correlated with the fair values of the asset or liability are demonstrably uncorrelated with recent indications of fair value for that asset or liability, (v) there is a significant increase in implied liquidity risk premiums, yields, or performance indicators (such as delinquency rates or loss severities) for observed transactions or quoted prices when compared with the Company’s estimate of expected cash flows, considering all available market data about credit and other nonperformance risk for the asset or liability, (vi) there is a wide bid-ask spread or significant increase in the bid-ask spread, (vii) there is a significant decline or absence of a market for new issuances (that is, a primary market) for the asset or liability or similar assets or liabilities, and (viii) little information is released publicly (for example, a principal-to-principal market). The Company considers the following factors to be indicators of non-orderly transactions: (i) there was not adequate exposure to the market for a period before the measurement date to allow for marketing activities that are usual and customary for transactions involving such assets or liabilities under current market conditions, (ii) there was a usual and customary marketing period, but the seller marketed the asset or liability to a single market participant, (iii) the seller is in or near bankruptcy or receivership (that is, distressed), or the seller was required to sell to meet regulatory or legal requirements (that is, forced), and (iv) the transaction price is an outlier when compared with other recent transactions for the same or similar assets or liabilities. |
Income Tax, Policy [Policy Text Block] | The Company elected to be taxed as a REIT for U.S. federal income tax purposes under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, beginning with its taxable year ended December 31, 2014 and intends to operate as such. To qualify as a REIT, the Company must continue to meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the Company’s annual REIT taxable income to its shareholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, the Company generally will not be subject to federal income tax to the extent it distributes qualifying dividends to its shareholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Such an event could materially and adversely affect the Company’s net income and net cash available for distribution to shareholders. However, the Company intends to organize and operate in such a manner as to qualify for treatment as a REIT. The Company has concluded that there are no significant uncertain tax positions requiring recognition in its financial statements. Neither the Company nor its subsidiaries have been assessed interest or penalties by any major tax jurisdictions. The Company’s evaluations were performed for the tax years ended December 31, 2016 and 2015. As of December 31, 2016, the returns for calendar years 2014 and 2015 remain subject to examination by major tax jurisdictions. |
Real Estate Held for Development and Sale, Policy [Policy Text Block] | Accounting for Real Estate Sales Real estate sales are accounted for in accordance with ASC 360. |
Distributions [Policy Text Block] | Distributions The Company intends, although is not legally obligated, to make regular quarterly distributions to holders of its shares at least at the level required to maintain REIT status unless the results of operations, general financial condition, general economic conditions or other factors inhibits the Company from doing so. Distributions are authorized at the discretion of the Company’s board of trust managers. th th Year ended December 31, 2016 December 31, 2015 Ordinary income $ 0.079 $ - Nontaxable dividend distribution $ 0.296 $ 0.375 $ 0.375 $ 0.375 Distributions declared per common share were $0.1875 per quarter for the years ended December 31, 2016 and 2015. |
Dividend Reinvestment Plan [Policy Text Block] | The Company has adopted the Plan through which common shareholders may elect to reinvest any amount up to the distributions declared on their shares in additional shares of the Company’s common stock in lieu of receiving cash distributions. Participants in the Plan will acquire common stock at a price per share equal to the price to acquire a share of common stock in the offering. The initial price per share in the offering, and as of the date of these financial statements, 10.00 The Plan states that the Company will consider the offering stage complete when the Company is not offering equity securities, which occurred on July 20, 2016, and has not done so for eighteen months. The Company currently expects to update the estimated value per share every twelve to eighteen months thereafter |
Redeemable Common Stock [Policy Text Block] | Redeemable Common Stock We have a share repurchase program pursuant to which all of our shareholders are eligible to sell their shares back to us for any reason on a quarterly basis. Shareholders who wish to participate in the share repurchase program must notify our Advisor, in writing, no later than the 15th day of the last month of the then current calendar quarter of such shareholder’s desire to participate in the program and the number of shares that it wants to have repurchased by us. Any shareholder who elects to participate in the share repurchase program will receive a confirmation of its redemption of shares setting forth the number and price of the shares sold back to us, and the total number of shares remaining in such shareholder’s account, if any. In exchange for the shares redeemed by us from shareholders, we shall pay such shareholders a per share purchase price in cash equal to the lesser of (i) the net asset value per share, as calculated and published by our Advisor and (ii) the per share price paid for the shares by the redeeming shareholder. The share repurchase program will be funded by, and limited to, proceeds realized from our sale of shares under the Plan. We reserve the right to reject any request for the redemption of shares. Additionally, we may terminate, suspend or amend the share repurchase program at any time without shareholder approval if we believe such action is in the best interest of all shareholders or if we determine the funds otherwise available to fund our share repurchase program are needed for other purposes. Share repurchase requests will be made on a first-come, first served basis. We cannot guarantee that we will have sufficient available cash flow to accommodate all requests when made. If we do not have such sufficient funds available, at the time when redemption is requested, the redeeming shareholder may (i) withdraw their request for redemption or (ii) ask that we honor their request, if and when sufficient funds become available. Such pending requests will generally be honored on a first-come, first-serve basis. When the Company became a SEC reporting company on May 29, 2016, it became subject to the SEC’s regulation limiting the maximum amount of shares that can be repurchased to 5% of the weighted average outstanding shares for the past twelve months. The maximum dollar amount that the Company can be required to repurchase at the balance sheet date is recorded as redeemable common stock. |
Advertising Cost, Policy, Expensed Advertising Cost [Policy Text Block] | Advertising Costs Advertising costs relating to the offering are expensed as incurred. offering advertising costs expensed were $ 1,515,661 682,053 |
Segment Reporting, Policy [Policy Text Block] | At December 31, 2016, with one exception, the Company invested in single-tenant income-producing properties. The Company’s real estate properties exhibit similar long-term financial performance and have similar economic characteristics to each other. As of December 31, 2016 and 2015, the Company aggregated its investments in real estate into one reportable segment. |
Earnings Per Share, Policy [Policy Text Block] | Per Share Data Basic earnings per share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share of common stock equals basic earnings per share of common stock as there were no potentially dilutive securities outstanding for the years ended December 31, 2016 and 2015. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results may differ from those estimates. |
Square Footage, Occupancy and Other Measures [Policy Text Block] | Square footage, occupancy and other measures used to describe real estate investments included in the Notes to Consolidated Financial Statements are presented on an unaudited basis. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements New Accounting Standards Issued and Adopted In April 2015, the FASB issued Accounting Standard Update (“ASU”) No. 2015-03, Interest Imputation of Interest (Subtopic 835-30) Interest - Imputation of Interest (Subtopic 835-30), Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements In August 2014, the FASB issued ASU No. 2014-15, Presentation of Financial Statements (Subtopic 205-40) Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern In February 2015, the FASB issued ASU No. 2015-02, Consolidation (Topic 810): Amendments to the Consolidation Analysis In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash In January 2017, the FASB issued ASU No. 2017-01, Business Combinations (Topic 805): Clarifying the Definition of a Business In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments On October 1, 2016, the Company elected to early adopt the provisions of ASU 2016-15, and the standard was applied retrospectively for all periods presented. As a result of the adoption of ASU 2016-15, the Company classified organization and offering costs as financing activities and acquisition fees as investing activities. In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue Recognition (Topic 605) Leases (Topic 840). Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) |
SUMMARY OF SIGNIFICANT ACCOUN22
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Policies [Abstract] | |
Dividends Declared [Table Text Block] | In 2016 and 2015, we paid all of our dividends in cash. The following summaries the taxability of our dividends Year ended December 31, 2016 December 31, 2015 Ordinary income $ 0.079 $ - Nontaxable dividend distribution $ 0.296 $ 0.375 $ 0.375 $ 0.375 |
RESTATEMENT (Tables)
RESTATEMENT (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Accounting Changes and Error Corrections [Abstract] | |
Schedule of Error Corrections and Prior Period Adjustments [Table Text Block] | The impact to certain captions in the December 31, 2015 consolidated financial statements is as follows: As Previously Reported Restated Balance Sheet $ Total real estate investments, net 40,527,230 $ 40,633,288 All other assets 8,000,804 8,286,067 Total assets $ 48,528,034 $ 48,919,355 Dividends payable $ 542,030 $ - Below-market leases, net - 770,685 Share repurchases payable - 261,312 Due to affiliates 753,888 269,178 All other liabilities 14,799,509 14,737,441 Total liabilities $ 16,095,427 $ 16,038,616 Common stock 34,582 34,524 Additional paid-in capital 34,721,362 341,277,669 Shareholders' distributions (1,214,135) - Treasury stock (232,106) - Cumulative distributions and net losses (877,096) (1,431,454) Total stockholders’ equity 32,432,607 32,880,739 Total liabilities and shareholders' equity $ 48,528,034 $ 48,919,355 Statement of Operations Total Revenue $ 976,982 $ 978,187 Depreciation and amortization 554,022 768,122 All other expenses 1,587,587 1,602,385 Total expenses 2,141,609 2,370,507 Other income 550,139 550,139 Net loss $ (614,488) $ (842,181) Net loss per share basic and diluted $ (0.43) $ (0.59) Statement of Cash Flows Net cash provided by operating activities $ 915,465 $ 600,734 Net cash provided by investing activities $ (41,930,547) $ (37,295,999) Net cash provided by financing activities 42,917,548 $ 38,597,730 |
REAL ESTATE INVESTMENTS (Tables
REAL ESTATE INVESTMENTS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Real Estate [Abstract] | |
Schedule of Real Estate Properties [Table Text Block] | The following table provides summary information regarding the Company’s real estate as of December 31, 2016 and 2015: 2016 2015 Tenant Origination Accumulated Total Real Total Real Land, and Depreciation Estate Estate Acquisition Property Buildings and Absorption and Investments, Investments, Property Location Date Type Improvements Costs Amortization net net Chase Bank & Great Clips Antioch, CA 8/22/2014 Retail $ 3,160,035 $ 668,200 $ (759,854) $ 3,068,381 $ 3,388,320 Chevron Gas Station Rancho Cordova, CA 2/6/2015 Retail 2,600,000 - (135,450) 2,464,550 2,536,790 Chevron Gas Station San Jose, CA 5/29/2015 Retail 2,775,000 - (62,989) 2,712,011 2,750,773 Levins Sacramento, CA 8/19/2015 Industrial 3,750,000 - (292,708) 3,457,292 3,670,170 Chevron Gas Station Roseville, CA 9/30/2015 Retail 2,800,000 - (123,438) 2,676,562 2,772,127 Island Pacific Supermarket Elk Grove, CA 10/1/2015 Retail 3,151,460 568,540 (207,063) 3,512,937 3,684,300 Dollar General Bakersfield, CA 11/11/2015 Retail 4,632,567 689,020 (216,044) 5,105,543 5,297,582 Rite Aid Lake Elsinore, CA 12/7/2015 Retail 6,663,446 968,286 (248,521) 7,383,211 7,621,793 PMI Preclinical San Carlos, CA 12/9/2015 Office 8,920,000 - (214,169) 8,705,831 8,911,433 EcoThrift Sacramento, CA 3/17/2016 Retail 4,486,993 541,729 (191,746) 4,836,976 - GSA (MSHA) Vacaville, CA 4/5/2016 Office 2,998,232 456,645 (110,616) 3,344,261 - PreK San Antonio San Antonio, TX 4/8/2016 Retail 11,851,540 1,593,451 (646,790) 12,798,201 - Dollar Tree Morrow, GA 4/22/2016 Retail 1,248,156 206,844 (64,831) 1,390,169 - Dinan Cars Morgan Hill, CA 6/21/2016 Industrial 4,651,845 654,155 (205,957) 5,100,043 - ITW Ripley El Dorado, CA 8/18/2016 Office 6,178,204 407,316 (110,536) 6,474,984 - Solar Turbines San Diego, CA 7/21/2016 Office 5,481,198 389,718 (86,700) 5,784,216 - Amec Foster San Diego, CA 7/21/2016 Office 5,697,402 485,533 (89,453) 6,093,482 - Dollar General Big Spring Big Spring, TX 11/4/2016 Retail 1,161,647 112,958 (3,796) 1,270,809 - Gap Rocklin, CA 12/1/2016 Office 7,209,629 677,191 (13,308) 7,873,512 - L-3 Communications San Diego, CA 12/23/2016 Office 10,462,442 961,107 (14,021) 11,409,528 - $ 99,879,796 $ 9,380,693 $ (3,797,990) $ 105,462,499 $ 40,633,288 |
Schedule of Real Estate Property Acquisitions [Table Text Block] | During the year ended December 31, 2016, the Company acquired the following properties: Land, building Tenant origination and and absorption Below-market Purchase Property improvements costs leases price EcoThrift $ 4,486,993 $ 541,729 $ (278,722) $ 4,750,000 GSA (MSHA) 2,998,232 456,645 (279,877) 3,175,000 PreK San Antonio 11,851,541 1,593,451 (2,594,992) 10,850,000 Dollar Tree 1,248,156 206,844 - 1,455,000 Dinan Cars 4,651,845 654,155 - 5,306,000 ITW Ripley 6,188,204 407,317 (144,521) 6,441,000 Solar Turbines 5,481,198 389,718 - 5,870,916 Amec Foster 5,697,402 485,533 - 6,182,935 Dollar General Big Spring 1,161,647 112,958 - 1,274,605 Gap 7,209,629 677,191 - 7,886,820 L-3 Communications 10,462,442 961,107 (1,251,985) 10,171,564 $ 61,437,289 $ 6,486,648 $ (4,550,097) $ 63,373,840 |
Schedule Of Real Estate Investment Property Purchase Price [Table Text Block] | Purchase price $ 63,373,840 Purchase deposits applied (6,105,512) Security deposits assumed and prorations (520,811) Acquisition fees and costs capitalized (572,839) Cash paid for acquisition of real estate $ 56,174,678 |
Schedule Of Lease Expiration Date [Table Text Block] | The expiration of the leases of the properties acquired during the year ended December 31, 2016 are as follows: Property Lease Expiration EcoThrift 2/28/2026 GSA (MSHA) 8/24/2026 PreK San Antonio 7/31/2021 Dollar Tree 7/31/2025 Dinan Cars 4/30/2023 ITW Ripley 8/1/2022 Solar Turbines 7/31/2021 Amec Foster 2/28/2021 Dollar General Big Spring 4/30/2030 Gap 2/28/2023 L-3 Communications 4/30/2022 |
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block] | As of December 31, 2016, the future minimum contractual rental income from the Company’s non-cancelable operating leases is as follows: 2017 $ 7,597,184 2018 7,494,631 2019 7,620,310 2020 7,757,781 2021 6,725,087 Thereafter 16,087,878 $ 53,282,871 |
Schedule of Finite-Lived Intangible Assets [Table Text Block] | As of December 31, 2016 and 2015, the Company’s intangibles were as follows: 2016 2015 Tenant Tenant Origination Origination and Above- Below- and Absorption Market Market Absorption Above-Market Below-Market Costs Leases Leases Costs Leases Leases Cost $ 9,380,694 $ 273,267 $ (5,349,908) $ 2,894,045 $ 273,267 $ (799,812) Accumulated amortization (1,166,366) (23,300) 508,152 (482,308) (932) 29,128 Net amount $ 8,214,329 $ 249,967 $ (4,841,757) $ 2,411,737 $ 272,335 $ (770,685) |
Schedule of Finite-Lived Intangible Assets, Future Amortization Expense [Table Text Block] | Amortization of intangible assets over the next five years is expected to be as follows: Tenant origination and Above- Below- absorption Market Market costs Leases Leases 2017 $ 1,424,201 $ 22,368 $ 840,392 2018 1,228,549 22,368 824,807 2019 1,228,549 22,368 824,807 2020 1,228,549 22,368 824,807 2021 1,110,269 22,368 632,183 Thereafter 1,994,211 138,127 894,760 $ 8,214,328 $ 249,967 $ 4,841,756 Weighted average remaining amortization period 7.16 years 11.15 years 4.8 years |
Business Acquisition, Pro Forma Information [Table Text Block] | This pro forma information does not purport to represent what the actual results of operations of the Company would have been had these acquisitions occurred on this date, nor does it purport to predict the results of operations for future periods. Year ended 2016 2015 Revenue $ 9,592,028 $ 8,267,664 Net income $ 429,412 $ 1,671,411 |
DEBT (Tables)
DEBT (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments [Table Text Block] | 2016 2015 Deferred Deferred Effective Principal Financing Net Principal Financing Net Contractual Interest Collateral Amount Costs Balance Amount Costs Balance Interest Rate Rate (1) Chase Bank & Great Clips $ 1,924,692 $ (34,073) $ 1,890,619 $ 1,958,505 $ (39,559) $ 1,918,946 4.37% 4.37 % Levins 2,212,470 (49,373) 2,163,097 $ 2,250,000 (8,500) $ 2,241,500 One-month LIBOR + 1.93% 3.74 % Island Pacific Supermarket 2,011,873 (47,655) 1,964,218 $ 2,046,000 (8,500) $ 2,037,500 One-month LIBOR + 1.93% 3.74 % Dollar General 2,480,276 (76,408) 2,403,868 - - - One-month LIBOR + 1.48% 3.38 % Rite Aid 3,907,849 (140,369) 3,767,480 - - - One-month LIBOR + 1.50% 3.25 % PMI Preclinical 4,394,926 (175,390) 4,219,536 - - - One-month LIBOR + 1.48% 3.38 % EcoThrift 2,825,628 (112,374) 2,713,254 - - - One-month LIBOR + 1.21% 2.96 % GSA 1,921,809 (86,474) 1,835,335 - - - One-month LIBOR + 1.25% 3.00 % PreK San Antonio 5,425,000 (287,794) 5,137,206 - - - 4.25% 4.25 % Dinan Cars 2,860,000 (202,635) 2,657,365 - - - One-month LIBOR + 2.27% 4.02 % ITW Ripley, Solar 10,054,125 (101,000) 9,953,125 - - - 3.35% 3.35 % $ 40,018,648 $ (1,313,545) $ 38,705,103 $ 6,254,505 $ (56,559) $ 6,197,946 (1) Contractual interest rate represents the interest rate in effect under the mortgage notes payable as of December 31, 2016. Effective interest rate is calculated as the actual interest rate in effect as of December 31, 2016 (consisting of the contractual interest rate and the effect of the interest rate swap, if applicable). For further information regarding the Company’s derivative instruments, see Note 8. |
Schedule of Maturities of Long-term Debt [Table Text Block] | The following summarizes the future principal payments of the Company’s mortgage notes payable as of December 31, 2016: 2017 $ 771,730 2018 806,171 2019 2,646,022 2020 820,867 2021 23,391,517 Thereafter 11,582,341 Total principal $ 40,018,648 |
Schedule Of Interest Expenses Reconciliation [Table Text Block] | The following is a reconciliation of the components of interest expense for the year ended December 31, 2016 and 2015: Year ended December 31, 2016 2015 Mortgage Payable Interest expense (1) $ 616,617 $ 86,382 Amortization of deferred financing costs 127,865 12,332 Unrealized gain on interest rate swaps (see Note 8) (73,919) - Unsecured Credit Facility Interest expense incurred 39,779 67,859 Amortization of deferred financing costs 12,250 19,865 Sales Deposit Liability (see Note 5) 45,530 - Total interest expense $ 768,122 $ 186,438 (1) Includes $ 145,836 0 13,709 |
INTEREST RATE SWAP DERIVATIVES
INTEREST RATE SWAP DERIVATIVES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments [Table Text Block] | The notional amount is an indication of the extent of the Company’s involvement in each instrument at that time, but does not represent exposure to credit, interest rate or market risks: December 31, 2016 Weighted Weighted Derivative Number of Reference Rate as of Average Fixed Average Instruments Instruments Notional Amount (i) 12/31/2016 Pay Rate Remaining Term Interest Rate Swaps 8 $ 22,871,000 One-month LIBOR/Fixed at 1.21%-2.28% 3.28 % 4.17 years (i) The notional amount of the Company’s swaps are reduced monthly to correspond to the outstanding principal balance on the related mortgage. The maximum notional amount is shown above. The minimum notional amount (outstanding principal balance at the maturity date) is $ 22,614,830 |
Schedule of Derivative Instruments in Statement of Financial Position, Fair Value [Table Text Block] | The following table sets forth the fair value of the Company’s derivative instruments as well as their classification in the consolidated balance sheet as of December 31, 2016. December 31, 2016 Derivative Instrument Balance Sheet Location Number of Instruments Fair Value Interest Rate Swaps Assets: Interest rate swap derivatives, at fair value 5 $ 180,759 Interest Rate Swap Liability: Interest rate swap derivatives, at fair value 3 $ (106,840) |
FAIR VALUE DISCLOSURES (Tables)
FAIR VALUE DISCLOSURES (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value, by Balance Sheet Grouping [Table Text Block] | The following were the face value, carrying amount and fair value of the Company’s mortgage notes payable as of December 31, 2016 and 2015: December 31, 2016 December 31, 2015 Face Value Carrying Value Fair Value Face Value Carrying Value Fair Value $ 40,018,648 $ 38,705,103 $ 38,153,219 $ 6,255,981 $ 6,197,946 $ 6,044,526 |
Fair Value, Liabilities Measured on Recurring Basis [Table Text Block] | During the year ended December 31, 2016, the Company measured the following assets and liabilities at fair value (in thousands): Quoted Prices in Active Significant Other Significant Markets for Identical Observable Inputs Unobservable Inputs Recurring Basis Total Assets (Level 1) (Level 2) (Level 3) Interest rate swap derivatives $ 73,918 $ - $ 73,918 $ - |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions [Table Text Block] | Year ended Year ended December December 31, 2016 December 31, 2016 31, 2015 December 31, 2015 Incurred Receivable Payable Incurred Receivable Payable Expensed: Acquisition fees $ 778,137 $ - $ - $ - * $ - $ - Asset management fees 404,561 - 43,993 73,200 - 73,200 Disposition fees 30,000 - - - - - Fees to affiliates 1,212,698 73,200 Property management fees ** 21,267 - 21,267 3,188 - 5,486 Reimbursable organizational and offering expenses 1,514,688 - 41,797 575,814 8,662 - Capitalized: Acquisition fees 375,391 48,950 - - - - Financing coordination fees 383,790 - 137,800 - - 42,960 Other: Due to advisor for costs advanced (2) 223,317 - 270,372 - - 47,055 Due to other - SSLFO (1) - - 100,477 - - 100,477 Due to NNN (2) 28,571 - 28,571 - - - $ 3,759,722 $ 48,950 $ 644,277 $ 652,202 $ 8,662 $ 269,178 * In lieu of the REIT paying acquisition fees, seller paid the acquisition fees through escrow. ** Property management fees are presented as property operating expenses. (1) These costs were incurred by SSLFO, an affiliate of the Sponsor, in connection with the organization and offering of the Company’s shares. (2) These costs were incurred in connection with the potential acquisition of a property by Rich Uncles NNN REIT Inc. The property was acquired by the Company. Therefore, the Company has a payable to Rich Uncles NNN REIT, Inc. |
SELECTED QUARTERLY FINANCIAL 29
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Tables) | 12 Months Ended |
Dec. 31, 2016 | |
Quarterly Financial Information Disclosure [Abstract] | |
Quarterly Financial Information [Table Text Block] | Presented below in a summary of the unaudited quarterly financial information for the year ended December 31, 2016 and 2015: 2016 First Quarter Second Quarter Third Quarter Fourth Quarter Revenue $ 813,083 $ 1,440,457 $ 1,909,708 $ 2,251,344 Net income (loss) (1,155,929) (1,245,064) (120,874) 630,479 Net income (loss) per common share, basic and diluted (0.27) (0.20) (0.01) 0.08 Distributions declared per common share 0.1875 0.1875 0.1875 0.1875 2015 First Quarter Second Quarter Third Quarter Fourth Quarter Revenue $ 123,147 $ 168,914 $ 228,014 $ 458,112 Net loss (352,874) (205,154) (150,401) (133,752) Net loss per common share, basic and diluted (1.09) (0.25) (0.09) (0.05) Distributions declared per common share 0.1875 0.1875 0.1875 0.1875 |
BUSINESS AND ORGANIZATION (Deta
BUSINESS AND ORGANIZATION (Details Textual) | Dec. 31, 2016USD ($) |
Common Stock, Value, Subscriptions | $ 3,000,000 |
Noncontrolling Interest, Ownership Percentage by Parent | 70.14% |
SUMMARY OF SIGNIFICANT ACCOUN31
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - $ / shares | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Ordinary income | $ 0.079 | $ 0 | ||||||||
Nontaxable dividend distribution | 0.296 | 0.375 | ||||||||
Common Stock, Dividends, Per Share, Declared | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.375 | $ 0.375 |
SUMMARY OF SIGNIFICANT ACCOUN32
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | Jul. 20, 2016 | |
Share Price | $ 10 | ||
Advertising Expense | $ 1,515,661 | $ 682,053 | |
Building [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 15 years | ||
Building [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 52 years | ||
Tenant Improvement [Member] | |||
Property, Plant and Equipment, Useful Life | 15 years | ||
Property, Plant and Equipment, Estimated Useful Lives | Shorter of 15 years or remaining contractual lease term | ||
Tenant Origination and Absorption Costs [Member] | |||
Property, Plant and Equipment, Estimated Useful Lives | Remaining contractual lease term with consideration as to above- and below-market extension options for above- and below-market lease intangibles | ||
Building Improvements [Member] | Minimum [Member] | |||
Property, Plant and Equipment, Useful Life | 5 years | ||
Building Improvements [Member] | Maximum [Member] | |||
Property, Plant and Equipment, Useful Life | 21 years |
RESTATEMENT (Details)
RESTATEMENT (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Total real estate investments, net | $ 105,462,499 | $ 40,633,288 | $ 105,462,499 | $ 40,633,288 | |||||||
Other assets | 750,243 | 137,150 | 750,243 | 137,150 | |||||||
Total assets | 121,407,570 | 48,919,355 | 121,407,570 | 48,919,355 | |||||||
Liabilities and Equity | |||||||||||
Below-market leases, net | 4,841,757 | 770,685 | 4,841,757 | 770,685 | |||||||
Share repurchases payable | 592,511 | 261,312 | 592,511 | 261,312 | |||||||
Due to affiliates | 644,277 | 269,178 | 644,277 | 269,178 | |||||||
Total liabilities | 46,813,735 | 16,038,616 | 46,813,735 | 16,038,616 | |||||||
Common stock | 82,492 | 34,524 | 82,492 | 34,524 | |||||||
Cumulative distributions and net losses | (7,355,354) | (1,431,454) | (7,355,354) | (1,431,454) | |||||||
Total stockholders’ equity | 73,364,189 | 32,880,739 | 73,364,189 | 32,880,739 | $ 3,297,147 | ||||||
Total liabilities and shareholders' equity | 121,407,570 | 48,919,355 | 121,407,570 | 48,919,355 | |||||||
Statement of Operations | |||||||||||
Total Revenue | 2,251,344 | $ 1,909,708 | $ 1,440,457 | $ 813,083 | 458,112 | $ 228,014 | $ 168,914 | $ 123,147 | 6,414,592 | 978,187 | |
Depreciation and amortization | 3,134,979 | 768,122 | |||||||||
Total expenses | 8,306,141 | 2,370,507 | |||||||||
Other income | 161 | 550,139 | |||||||||
Net loss | $ 630,479 | $ (120,874) | $ (1,245,064) | $ (1,155,929) | $ (133,752) | $ (150,401) | $ (205,154) | $ (352,874) | $ (1,891,388) | $ (842,181) | |
Net loss per share basic and diluted | $ 0.08 | $ (0.01) | $ (0.20) | $ (0.27) | $ (0.05) | $ (0.09) | $ (0.25) | $ (1.09) | $ (0.28) | $ (0.59) | |
Statement of Cash Flows | |||||||||||
Net cash provided by operating activities | $ 3,328,927 | $ 600,734 | |||||||||
Net cash provided by investing activities | (64,031,855) | (37,295,999) | |||||||||
Net cash provided by financing activities | 72,065,212 | 38,597,730 | |||||||||
Scenario, Previously Reported [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Total real estate investments, net | $ 40,527,230 | 40,527,230 | |||||||||
Other assets | 8,000,804 | 8,000,804 | |||||||||
Total assets | 48,528,034 | 48,528,034 | |||||||||
Liabilities and Equity | |||||||||||
Dividends payable | 542,030 | 542,030 | |||||||||
Below-market leases, net | 0 | 0 | |||||||||
Share repurchases payable | $ 0 | 0 | |||||||||
Due to affiliates | 753,888 | 753,888 | |||||||||
Total liabilities | 16,095,427 | 16,095,427 | |||||||||
Common stock | $ 34,582 | $ 34,582 | |||||||||
Additional paid-in capital | 34,721,362 | 34,721,362 | |||||||||
Shareholders' distributions | (1,214,135) | (1,214,135) | |||||||||
Treasury stock | (232,106) | (232,106) | |||||||||
Cumulative distributions and net losses | (877,096) | (877,096) | |||||||||
Total stockholders’ equity | 32,432,607 | 32,432,607 | |||||||||
Total liabilities and shareholders' equity | 48,528,034 | 48,528,034 | |||||||||
All other liabilities | 14,799,509 | 14,799,509 | |||||||||
Statement of Operations | |||||||||||
Total Revenue | 976,982 | ||||||||||
Depreciation and amortization | 554,022 | ||||||||||
All other expenses | 1,587,587 | ||||||||||
Total expenses | 2,141,609 | ||||||||||
Other income | 550,139 | ||||||||||
Net loss | $ (614,488) | ||||||||||
Net loss per share basic and diluted | $ (0.43) | ||||||||||
Statement of Cash Flows | |||||||||||
Net cash provided by operating activities | $ 915,465 | ||||||||||
Net cash provided by investing activities | (41,930,547) | ||||||||||
Net cash provided by financing activities | 42,917,548 | ||||||||||
Scenario, Adjustment [Member] | |||||||||||
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |||||||||||
Total real estate investments, net | 40,633,288 | 40,633,288 | |||||||||
Other assets | 8,286,067 | 8,286,067 | |||||||||
Total assets | 48,919,355 | 48,919,355 | |||||||||
Liabilities and Equity | |||||||||||
Dividends payable | 0 | 0 | |||||||||
Below-market leases, net | 770,685 | 770,685 | |||||||||
Share repurchases payable | 261,312 | 261,312 | |||||||||
Due to affiliates | 269,178 | 269,178 | |||||||||
Total liabilities | 16,038,616 | 16,038,616 | |||||||||
Common stock | 34,524 | 34,524 | |||||||||
Additional paid-in capital | 341,277,669 | 341,277,669 | |||||||||
Shareholders' distributions | 0 | 0 | |||||||||
Treasury stock | 0 | 0 | |||||||||
Cumulative distributions and net losses | (1,431,454) | (1,431,454) | |||||||||
Total stockholders’ equity | 32,880,739 | 32,880,739 | |||||||||
Total liabilities and shareholders' equity | 48,919,355 | 48,919,355 | |||||||||
All other liabilities | $ 14,737,441 | 14,737,441 | |||||||||
Statement of Operations | |||||||||||
Total Revenue | 978,187 | ||||||||||
Depreciation and amortization | 768,122 | ||||||||||
All other expenses | 1,602,385 | ||||||||||
Total expenses | 2,370,507 | ||||||||||
Other income | 550,139 | ||||||||||
Net loss | $ (842,181) | ||||||||||
Net loss per share basic and diluted | $ (0.59) | ||||||||||
Statement of Cash Flows | |||||||||||
Net cash provided by operating activities | $ 600,734 | ||||||||||
Net cash provided by investing activities | (37,295,999) | ||||||||||
Net cash provided by financing activities | $ 38,597,730 |
RESTATEMENT (Details Textual)
RESTATEMENT (Details Textual) | 12 Months Ended |
Dec. 31, 2014USD ($) | |
Error Corrections and Prior Period Adjustments Restatement [Line Items] | |
Stockholders' Equity, Period Increase (Decrease) | $ 445,022 |
REAL ESTATE INVESTMENTS (Detail
REAL ESTATE INVESTMENTS (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Land building and improvements | $ 99,879,796 | ||
Tenant origination and absorption costs | 9,380,693 | $ 2,894,046 | |
Accumulated depreciation and amortization | (3,797,990) | (713,268) | |
Total real estate investments, net | $ 105,462,499 | 40,633,288 | |
Chase Bank Great Clips [Member] | Antioch, CA [Member] | Retail Site [Member] | |||
Acquisition Date | Sep. 22, 2014 | ||
Land building and improvements | $ 3,160,035 | ||
Tenant origination and absorption costs | 668,200 | ||
Accumulated depreciation and amortization | (759,854) | ||
Total real estate investments, net | $ 3,068,381 | 3,388,320 | |
Chevron Gas Station [Member] | Rancho Cordova, CA [Member] | |||
Acquisition Date | Feb. 6, 2015 | ||
Chevron Gas Station [Member] | Rancho Cordova, CA [Member] | Retail Site [Member] | |||
Acquisition Date | Feb. 6, 2015 | ||
Land building and improvements | $ 2,600,000 | ||
Tenant origination and absorption costs | 0 | ||
Accumulated depreciation and amortization | (135,450) | ||
Total real estate investments, net | $ 2,464,550 | 2,536,790 | |
Chevron Gas Station [Member] | San Jose, CA [Member] | |||
Acquisition Date | May 29, 2015 | ||
Chevron Gas Station [Member] | San Jose, CA [Member] | Retail Site [Member] | |||
Acquisition Date | May 29, 2015 | ||
Land building and improvements | $ 2,775,000 | ||
Tenant origination and absorption costs | 0 | ||
Accumulated depreciation and amortization | (62,989) | ||
Total real estate investments, net | $ 2,712,011 | 2,750,773 | |
Chevron Gas Station [Member] | Roseville, CA [Member] | |||
Acquisition Date | [1] | Sep. 30, 2015 | |
Chevron Gas Station [Member] | Roseville, CA [Member] | Retail Site [Member] | |||
Acquisition Date | Sep. 30, 2015 | ||
Land building and improvements | $ 2,800,000 | ||
Tenant origination and absorption costs | 0 | ||
Accumulated depreciation and amortization | (123,438) | ||
Total real estate investments, net | $ 2,676,562 | ||
Levins [Member] | |||
Acquisition Date | Aug. 19, 2015 | ||
Levins [Member] | Sacramento, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 3,670,170 | ||
Levins [Member] | Sacramento, CA [Member] | Industrial Property [Member] | |||
Acquisition Date | Aug. 19, 2015 | ||
Land building and improvements | $ 3,750,000 | ||
Tenant origination and absorption costs | 0 | ||
Accumulated depreciation and amortization | (292,708) | ||
Total real estate investments, net | $ 3,457,292 | ||
Chevron Gas Station [Member] | Roseville, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 2,772,127 | ||
Island Pacific Supermarket [Member] | |||
Acquisition Date | Oct. 1, 2015 | ||
Island Pacific Supermarket [Member] | Elk Grove, CA [Member] | Retail Site [Member] | |||
Acquisition Date | Oct. 1, 2015 | ||
Land building and improvements | $ 3,151,460 | ||
Tenant origination and absorption costs | 568,540 | ||
Accumulated depreciation and amortization | (207,063) | ||
Total real estate investments, net | $ 3,512,937 | 3,684,300 | |
Dollar General [Member] | |||
Acquisition Date | Nov. 11, 2015 | ||
Dollar General [Member] | Bakersfield, CA [Member] | Retail Site [Member] | |||
Acquisition Date | Nov. 11, 2015 | ||
Land building and improvements | $ 4,632,567 | ||
Tenant origination and absorption costs | 689,020 | ||
Accumulated depreciation and amortization | (216,044) | ||
Total real estate investments, net | $ 5,105,543 | 5,297,582 | |
Rite Aid [Member] | |||
Acquisition Date | Dec. 7, 2015 | ||
Rite Aid [Member] | Lake Elsinore, CA [Member] | Retail Site [Member] | |||
Acquisition Date | Dec. 7, 2015 | ||
Land building and improvements | $ 6,663,446 | ||
Tenant origination and absorption costs | 968,286 | ||
Accumulated depreciation and amortization | (248,521) | ||
Total real estate investments, net | $ 7,383,211 | 7,621,793 | |
PMI Preclinical [Member] | |||
Acquisition Date | Dec. 9, 2015 | ||
PMI Preclinical [Member] | San Carlos, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 8,911,433 | ||
PMI Preclinical [Member] | San Carlos, CA [Member] | Office Building [Member] | |||
Acquisition Date | Dec. 9, 2015 | ||
Land building and improvements | $ 8,920,000 | ||
Tenant origination and absorption costs | 0 | ||
Accumulated depreciation and amortization | (214,169) | ||
Total real estate investments, net | $ 8,705,831 | ||
EcoThrift [Member] | |||
Acquisition Date | Mar. 17, 2016 | ||
EcoThrift [Member] | Sacramento, CA [Member] | Retail Site [Member] | |||
Acquisition Date | Mar. 17, 2016 | ||
Land building and improvements | $ 4,486,993 | ||
Tenant origination and absorption costs | 541,729 | ||
Accumulated depreciation and amortization | (191,746) | ||
Total real estate investments, net | $ 4,836,976 | 0 | |
GSA MSHA [Member] | |||
Acquisition Date | Apr. 5, 2016 | ||
GSA MSHA [Member] | Vacaville, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 0 | ||
GSA MSHA [Member] | Vacaville, CA [Member] | Office Building [Member] | |||
Acquisition Date | Apr. 5, 2016 | ||
Land building and improvements | $ 2,998,232 | ||
Tenant origination and absorption costs | 456,645 | ||
Accumulated depreciation and amortization | (110,616) | ||
Total real estate investments, net | $ 3,344,261 | ||
PreK San Antonio [Member] | |||
Acquisition Date | Apr. 8, 2016 | ||
PreK San Antonio [Member] | San Antonio, TX [Member] | Retail Site [Member] | |||
Acquisition Date | Apr. 8, 2016 | ||
Land building and improvements | $ 11,851,540 | ||
Tenant origination and absorption costs | 1,593,451 | ||
Accumulated depreciation and amortization | (646,790) | ||
Total real estate investments, net | $ 12,798,201 | 0 | |
Dollar Tree [Member] | |||
Acquisition Date | Apr. 22, 2016 | ||
Dollar Tree [Member] | Morrow, GA [Member] | Retail Site [Member] | |||
Acquisition Date | Apr. 22, 2016 | ||
Land building and improvements | $ 1,248,156 | ||
Tenant origination and absorption costs | 206,844 | ||
Accumulated depreciation and amortization | (64,831) | ||
Total real estate investments, net | $ 1,390,169 | 0 | |
Dinan Cars [Member] | |||
Acquisition Date | Jun. 21, 2016 | ||
Dinan Cars [Member] | Morgan Hill, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 0 | ||
Dinan Cars [Member] | Morgan Hill, CA [Member] | Industrial Property [Member] | |||
Acquisition Date | Jun. 21, 2016 | ||
Land building and improvements | $ 4,651,845 | ||
Tenant origination and absorption costs | 654,155 | ||
Accumulated depreciation and amortization | (205,957) | ||
Total real estate investments, net | $ 5,100,043 | ||
ITW Ripley [Member] | |||
Acquisition Date | Aug. 18, 2016 | ||
ITW Ripley [Member] | El Dorado, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 0 | ||
ITW Ripley [Member] | El Dorado, CA [Member] | Industrial Property [Member] | |||
Land building and improvements | $ 6,178,204 | ||
Tenant origination and absorption costs | 407,316 | ||
Accumulated depreciation and amortization | (110,536) | ||
Total real estate investments, net | $ 6,474,984 | ||
ITW Ripley [Member] | El Dorado, CA [Member] | Office Building [Member] | |||
Acquisition Date | Aug. 18, 2016 | ||
Solar Turbines [Member] | |||
Acquisition Date | Jul. 21, 2016 | ||
Solar Turbines [Member] | San Diego, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 0 | ||
Solar Turbines [Member] | San Diego, CA [Member] | Office Building [Member] | |||
Acquisition Date | Jul. 21, 2016 | ||
Land building and improvements | $ 5,481,198 | ||
Tenant origination and absorption costs | 389,718 | ||
Accumulated depreciation and amortization | (86,700) | ||
Total real estate investments, net | $ 5,784,216 | ||
Amec Foster [Member] | |||
Acquisition Date | Jul. 21, 2016 | ||
Amec Foster [Member] | San Diego, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 0 | ||
Amec Foster [Member] | San Diego, CA [Member] | Office Building [Member] | |||
Acquisition Date | Jul. 21, 2016 | ||
Land building and improvements | $ 5,697,402 | ||
Tenant origination and absorption costs | 485,533 | ||
Accumulated depreciation and amortization | (89,453) | ||
Total real estate investments, net | $ 6,093,482 | ||
Dollar General Big Spring [Member] | |||
Acquisition Date | Nov. 4, 2016 | ||
Dollar General Big Spring [Member] | Big Spring, TX [Member] | Retail Site [Member] | |||
Acquisition Date | Nov. 4, 2016 | ||
Land building and improvements | $ 1,161,647 | ||
Tenant origination and absorption costs | 112,958 | ||
Accumulated depreciation and amortization | (3,796) | ||
Total real estate investments, net | $ 1,270,809 | 0 | |
Gap [Member] | |||
Acquisition Date | Dec. 1, 2016 | ||
Gap [Member] | Rocklin, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | 0 | ||
Gap [Member] | Rocklin, CA [Member] | Office Building [Member] | |||
Acquisition Date | Dec. 1, 2016 | ||
Land building and improvements | $ 7,209,629 | ||
Tenant origination and absorption costs | 677,191 | ||
Accumulated depreciation and amortization | (13,308) | ||
Total real estate investments, net | $ 7,873,512 | ||
L Communications [Member] | |||
Acquisition Date | Dec. 23, 2016 | ||
L Communications [Member] | San Diego, CA [Member] | Retail Site [Member] | |||
Total real estate investments, net | $ 0 | ||
L Communications [Member] | San Diego, CA [Member] | Office Building [Member] | |||
Acquisition Date | Dec. 23, 2016 | ||
Land building and improvements | $ 10,462,442 | ||
Tenant origination and absorption costs | 961,107 | ||
Accumulated depreciation and amortization | (14,021) | ||
Total real estate investments, net | $ 11,409,528 | ||
[1] | The Company owns an undivided 70.14% interest through a tenancy in common agreement that was entered into in March 2016. |
REAL ESTATE INVESTMENTS (Deta36
REAL ESTATE INVESTMENTS (Details 1) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 | |
Land, Buildings and Improvements | [1] | $ 61,437,289 | |
Tenant origination and absorption costs | 6,486,648 | ||
Below-market leases | (4,841,757) | $ (770,685) | |
Purchase Price | 63,373,840 | $ 40,633,288 | |
EcoThrift [Member] | |||
Land, Buildings and Improvements | [1] | 4,486,993 | |
Tenant origination and absorption costs | 541,729 | ||
Below-market leases | (278,722) | ||
Purchase Price | 4,750,000 | ||
GSA (MSHA) [Member] | |||
Land, Buildings and Improvements | [1] | 2,998,232 | |
Tenant origination and absorption costs | 456,645 | ||
Below-market leases | (279,877) | ||
Purchase Price | 3,175,000 | ||
PreK San Antonio [Member] | |||
Land, Buildings and Improvements | [1] | 11,851,541 | |
Tenant origination and absorption costs | 1,593,451 | ||
Below-market leases | (2,594,992) | ||
Purchase Price | 10,850,000 | ||
Dollar Tree [Member] | |||
Land, Buildings and Improvements | [1] | 1,248,156 | |
Tenant origination and absorption costs | 206,844 | ||
Below-market leases | 0 | ||
Purchase Price | 1,455,000 | ||
Dinan Cars [Member] | |||
Land, Buildings and Improvements | [1] | 4,651,845 | |
Tenant origination and absorption costs | 654,155 | ||
Below-market leases | 0 | ||
Purchase Price | 5,306,000 | ||
ITW Ripley [Member] | |||
Land, Buildings and Improvements | [1] | 6,188,204 | |
Tenant origination and absorption costs | 407,317 | ||
Below-market leases | (144,521) | ||
Purchase Price | 6,441,000 | ||
Solar Turbines [Member] | |||
Land, Buildings and Improvements | [1] | 5,481,198 | |
Tenant origination and absorption costs | 389,718 | ||
Below-market leases | 0 | ||
Purchase Price | 5,870,916 | ||
Amec Foster [Member] | |||
Land, Buildings and Improvements | [1] | 5,697,402 | |
Tenant origination and absorption costs | 485,533 | ||
Below-market leases | 0 | ||
Purchase Price | 6,182,935 | ||
Dollar General Big Spring [Member] | |||
Land, Buildings and Improvements | [1] | 1,161,647 | |
Tenant origination and absorption costs | 112,958 | ||
Below-market leases | 0 | ||
Purchase Price | 1,274,605 | ||
Gap [Member] | |||
Land, Buildings and Improvements | [1] | 7,209,629 | |
Tenant origination and absorption costs | 677,191 | ||
Below-market leases | 0 | ||
Purchase Price | 7,886,820 | ||
L-3 Communications [Member] | |||
Land, Buildings and Improvements | [1] | 10,462,442 | |
Tenant origination and absorption costs | 961,107 | ||
Below-market leases | (1,251,985) | ||
Purchase Price | $ 10,171,564 | ||
[1] | Building and improvements include tenant origination and absorption costs |
REAL ESTATE INVESTMENTS (Deta37
REAL ESTATE INVESTMENTS (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Purchase price | $ 63,373,840 | $ 40,633,288 |
Purchase deposits applied | 6,626,321 | 2,500,000 |
Security deposits assumed and prorations | 520,811 | 299,853 |
Acquisition fees and costs capitalized | 913,689 | 225,121 |
Cash paid for acquisition of real estate | $ 56,174,678 | $ 34,166,362 |
REAL ESTATE INVESTMENTS (Deta38
REAL ESTATE INVESTMENTS (Details 3) | 12 Months Ended |
Dec. 31, 2016 | |
EcoThrift [Member] | |
Lease Expiration Date | Feb. 28, 2026 |
GSA (MSHA) [Member] | |
Lease Expiration Date | Aug. 24, 2026 |
PreK San Antonio [Member] | |
Lease Expiration Date | Jul. 31, 2021 |
Dollar Tree [Member] | |
Lease Expiration Date | Jul. 31, 2025 |
Dinan Cars [Member] | |
Lease Expiration Date | Apr. 30, 2023 |
ITW Ripley [Member] | |
Lease Expiration Date | Aug. 1, 2022 |
Solar Turbines [Member] | |
Lease Expiration Date | Jul. 31, 2021 |
Amec Foster [Member] | |
Lease Expiration Date | Feb. 28, 2021 |
Dollar General Big Spring [Member] | |
Lease Expiration Date | Apr. 30, 2030 |
Gap [Member] | |
Lease Expiration Date | Feb. 28, 2023 |
L-3 Communications [Member] | |
Lease Expiration Date | Apr. 30, 2022 |
REAL ESTATE INVESTMENTS (Deta39
REAL ESTATE INVESTMENTS (Details 4) | Dec. 31, 2016USD ($) |
2,017 | $ 7,597,184 |
2,018 | 7,494,631 |
2,019 | 7,620,310 |
2,020 | 7,757,781 |
2,021 | 6,725,087 |
Thereafter | 16,087,878 |
Operating Leases, Future Minimum Payments Receivable | $ 53,282,871 |
REAL ESTATE INVESTMENTS (Deta40
REAL ESTATE INVESTMENTS (Details 5) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Below-Market Leases, Cost | $ (5,349,908) | $ (799,812) |
Below-Market Leases, Accumulated amortization | 508,152 | 29,128 |
Below-Market Leases, Net Amount | 4,841,757 | 770,685 |
Tenant Origination and Absorption Costs [Member] | ||
Finite-Lived Intangible Assets, Cost | 9,380,694 | 2,894,045 |
Finite-Lived Intangible Assets, Accumulated Amortization | (1,166,366) | (482,308) |
Finite-Lived Intangible Assets, Net Amount | 8,214,329 | 2,411,737 |
Above-Market Leases [Member] | ||
Finite-Lived Intangible Assets, Cost | 273,267 | 273,267 |
Finite-Lived Intangible Assets, Accumulated Amortization | (23,300) | (932) |
Finite-Lived Intangible Assets, Net Amount | $ 249,967 | $ 272,335 |
REAL ESTATE INVESTMENTS (Deta41
REAL ESTATE INVESTMENTS (Details 6) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
2,017 | $ 840,392 | |
2,018 | 824,807 | |
2,019 | 824,807 | |
2,020 | 824,807 | |
2,021 | 632,183 | |
Thereafter | 894,760 | |
Below-Market Lease Finite-Lived Intangible Net | 4,841,756 | |
Tenant Origination and Absorption Costs [Member] | ||
2,017 | 1,424,201 | |
2,018 | 1,228,549 | |
2,019 | 1,228,549 | |
2,020 | 1,228,549 | |
2,021 | 1,110,269 | |
Thereafter | 1,994,211 | |
Finite-Lived Intangible Assets, Net | $ 8,214,329 | $ 2,411,737 |
Weighted average remaining amortization period | 7 years 1 month 28 days | |
Above-Market Leases [Member] | ||
2,017 | $ 22,368 | |
2,018 | 22,368 | |
2,019 | 22,368 | |
2,020 | 22,368 | |
2,021 | 22,368 | |
Thereafter | 138,127 | |
Finite-Lived Intangible Assets, Net | $ 249,967 | $ 272,335 |
Weighted average remaining amortization period | 11 years 1 month 24 days | |
Below-Market Leases [Member] | ||
Weighted Average Remaining Amortization Period Below-Market Lease Intangibles | 4 years 9 months 18 days |
REAL ESTATE INVESTMENTS (Deta42
REAL ESTATE INVESTMENTS (Details 7) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | $ 9,592,028 | $ 8,267,664 |
Net income | $ 429,412 | $ 1,671,411 |
REAL ESTATE INVESTMENTS (Deta43
REAL ESTATE INVESTMENTS (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Business Combination, Acquisition Related Costs | $ 913,689 | $ 225,121 |
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | $ 913,689 | $ 0 |
Finite-Lived Intangible Asset, Useful Life | 7 years 3 months 22 days | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Property, Plant, and Equipment | $ 501,025 | |
Customer Tenants Risk [Member] | Sales Revenue, Net [Member] | ||
Concentration Risk, Percentage | 29.00% | 74.00% |
Advisory Agreement [Member] | ||
Business Combination, Acquisition Related Costs | $ 913,689 | |
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 3,121,969 | |
Combination, Pro Forma Information, Operating Expenses of Acquiree since Acquisition Date, Actual | $ 812,022 |
SALE OF INTEREST IN REAL PROP44
SALE OF INTEREST IN REAL PROPERTY (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Proceeds from Sale of Real Estate | $ 1,000,000 | $ 1,000,000 | $ 0 |
Interest Expense, Customer Deposits | $ 45,530 | ||
Chevron Gas Station [Member] | |||
Equity Method Investment, Ownership Percentage | 29.86% |
DISTRIBUTIONS RECEIVABLE FROM45
DISTRIBUTIONS RECEIVABLE FROM LIMITED PARTNERSHIPS (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Proceeds from Equity Method Investment, Dividends or Distributions | $ 21,193 | $ (21,193) |
Proceeds from Limited Partnership Investments | $ 1,230,858 |
DEBT (Details)
DEBT (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Principal Amount | $ 38,705,103 | $ 6,197,946 | |
Mortgages [Member] | |||
Principal Amount | 40,018,648 | 6,254,505 | |
Deferred Financing Costs | (1,313,545) | (56,559) | |
Net Balance | 38,705,103 | 6,197,946 | |
Mortgages [Member] | Chase Bank Great Clips [Member] | |||
Principal Amount | 1,924,692 | 1,958,505 | |
Deferred Financing Costs | (34,073) | (39,559) | |
Net Balance | $ 1,890,619 | 1,918,946 | |
Contractual Interest Rate | 4.37% | ||
Effective Interest Rate | [1] | 4.37% | |
Mortgages [Member] | Levins [Member] | |||
Principal Amount | $ 2,212,470 | 2,250,000 | |
Deferred Financing Costs | (49,373) | (8,500) | |
Net Balance | $ 2,163,097 | 2,241,500 | |
Contractual Interest Rate | One-month LIBOR + 1.93% | ||
Effective Interest Rate | [1] | 3.74% | |
Mortgages [Member] | Island Pacific Supermarket [Member] | |||
Principal Amount | $ 2,011,873 | 2,046,000 | |
Deferred Financing Costs | (47,655) | (8,500) | |
Net Balance | $ 1,964,218 | 2,037,500 | |
Contractual Interest Rate | One-month LIBOR + 1.93% | ||
Effective Interest Rate | [1] | 3.74% | |
Mortgages [Member] | Dollar General [Member] | |||
Principal Amount | $ 2,480,276 | 0 | |
Deferred Financing Costs | (76,408) | 0 | |
Net Balance | $ 2,403,868 | 0 | |
Contractual Interest Rate | One-month LIBOR + 1.48% | ||
Effective Interest Rate | [1] | 3.38% | |
Mortgages [Member] | Rite Aid [Member] | |||
Principal Amount | $ 3,907,849 | 0 | |
Deferred Financing Costs | (140,369) | 0 | |
Net Balance | $ 3,767,480 | 0 | |
Contractual Interest Rate | One-month LIBOR + 1.50% | ||
Effective Interest Rate | [1] | 3.25% | |
Mortgages [Member] | PMI Preclinical [Member] | |||
Principal Amount | $ 4,394,926 | 0 | |
Deferred Financing Costs | (175,390) | 0 | |
Net Balance | $ 4,219,536 | 0 | |
Contractual Interest Rate | One-month LIBOR + 1.48% | ||
Effective Interest Rate | [1] | 3.38% | |
Mortgages [Member] | EcoThrift [Member] | |||
Principal Amount | $ 2,825,628 | 0 | |
Deferred Financing Costs | (112,374) | 0 | |
Net Balance | $ 2,713,254 | 0 | |
Contractual Interest Rate | One-month LIBOR + 1.21% | ||
Effective Interest Rate | [1] | 2.96% | |
Mortgages [Member] | PreK San Antonio [Member] | |||
Principal Amount | $ 5,425,000 | 0 | |
Deferred Financing Costs | (287,794) | 0 | |
Net Balance | $ 5,137,206 | 0 | |
Contractual Interest Rate | 4.25% | ||
Effective Interest Rate | [1] | 4.25% | |
Mortgages [Member] | GSA [Member] | |||
Principal Amount | $ 1,921,809 | 0 | |
Deferred Financing Costs | (86,474) | 0 | |
Net Balance | $ 1,835,335 | 0 | |
Contractual Interest Rate | One-month LIBOR + 1.25% | ||
Effective Interest Rate | [1] | 3.00% | |
Mortgages [Member] | Dinan Cars [Member] | |||
Principal Amount | $ 2,860,000 | 0 | |
Deferred Financing Costs | (202,635) | 0 | |
Net Balance | $ 2,657,365 | 0 | |
Contractual Interest Rate | One-month LIBOR + 2.27% | ||
Effective Interest Rate | [1] | 4.02% | |
Mortgages [Member] | ITW Ripley, Solar Turbines, Amec Foster [Member] | |||
Principal Amount | $ 10,054,125 | 0 | |
Deferred Financing Costs | (101,000) | 0 | |
Net Balance | $ 9,953,125 | $ 0 | |
Contractual Interest Rate | 3.35% | ||
Effective Interest Rate | [1] | 3.35% | |
[1] | Contractual interest rate represents the interest rate in effect under the mortgage notes payable as of December 31, 2016. Effective interest rate is calculated as the actual interest rate in effect as of December 31, 2016 (consisting of the contractual interest rate and the effect of the interest rate swap, if applicable). For further information regarding the Company’s derivative instruments, see Note 8. |
DEBT (Details 1)
DEBT (Details 1) - Secured Debt [Member] | Dec. 31, 2016USD ($) |
2,017 | $ 771,730 |
2,018 | 806,171 |
2,019 | 2,646,022 |
2,020 | 820,867 |
2,021 | 23,391,517 |
Thereafter | 11,582,341 |
Total principal | $ 40,018,648 |
DEBT (Details 2)
DEBT (Details 2) - USD ($) | 12 Months Ended | ||
Dec. 31, 2016 | Dec. 31, 2015 | ||
Unrealized gain on interest rate swaps (see Note 8) | $ 73,919 | $ 0 | |
Sales Deposit Liability (See Note 5) | 45,530 | ||
Total interest expense | 768,122 | 186,438 | |
Unsecured Debt [Member] | |||
Interest expense | 39,779 | 67,859 | |
Amortization of deferred financing costs | 12,250 | 19,865 | |
Sales Deposit Liability (See Note 5) | 45,530 | 0 | |
Total interest expense | 768,122 | 186,438 | |
Secured Debt [Member] | |||
Interest expense | [1] | 616,617 | 86,382 |
Amortization of deferred financing costs | 127,865 | 12,332 | |
Unrealized gain on interest rate swaps (see Note 8) | $ (73,919) | $ 0 | |
[1] | Includes $145,836 and $0 for the year ended December 31, 2016 and 2015, respectively, of monthly payments to settle the Company’s interest rate swaps and $13,709 of accrual interest payable at December 31, 2016 representing the unsettled portion of the interest rate swaps for the period from the most recent settlement date through December 31, 2016. |
DEBT (Details Textual)
DEBT (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Interest Expenses, Interest Rate Swap | $ 145,836 | $ 0 |
Interest Payable | $ 13,709 |
INTEREST RATE SWAP DERIVATIVE50
INTEREST RATE SWAP DERIVATIVES (Details) - Interest Rate Swap [Member] | 12 Months Ended | |
Dec. 31, 2016USD ($) | ||
Derivative Instruments, Number of Instruments | 8 | |
Derivative Instruments, Notional Amount | $ 22,871,000 | [1] |
Derivative Instruments, Reference Rate | One-month LIBOR/Fixed at 1.21%-2.28% | |
Derivative Instruments, Weighted Average Fixed Pay Rate | 3.28% | |
Derivative Instruments, Weighted Average Remaining Term | 4 years 2 months 1 day | |
[1] | The notional amount of the Company’s swaps are reduced monthly to correspond to the outstanding principal balance on the related mortgage. The maximum notional amount is shown above. The minimum notional amount (outstanding principal balance at the maturity date) is $22,614,830. |
INTEREST RATE SWAP DERIVATIVE51
INTEREST RATE SWAP DERIVATIVES (Details 1) | 12 Months Ended | |
Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Derivative Instrument, Fair Value | $ 106,840 | $ 0 |
Interest Rate Swap [Member] | ||
Derivative Instruments, Number of Instruments | 8 | |
Interest Rate Swap [Member] | Liability [Member] | ||
Derivative Instrument, Balance Sheet Location | Liability: Interest rate swap derivatives, at fair value | |
Derivative Instruments, Number of Instruments | 3 | |
Derivative Instrument, Fair Value | $ (106,840) | |
Interest Rate Swap [Member] | Assets [Member] | ||
Derivative Instrument, Balance Sheet Location | Assets: Interest rate swap derivatives, at fair value | |
Derivative Instruments, Number of Instruments | 5 | |
Derivative Instrument, Fair Value | $ 180,759 |
INTEREST RATE SWAP DERIVATIVE52
INTEREST RATE SWAP DERIVATIVES (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Unrealized Gain (Loss) on Derivatives | $ 73,919 | $ 0 |
Maximum [Member] | ||
Derivative, Notional Amount | $ 22,614,830 |
FAIR VALUE DISCLOSURES (Details
FAIR VALUE DISCLOSURES (Details) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Debt Instrument, Face Value | $ 40,018,648 | $ 6,255,981 |
Debt Instrument, Carrying Value | 38,705,103 | 6,197,946 |
Debt Instrument, Fair Value | $ 38,153,219 | $ 6,044,526 |
FAIR VALUE DISCLOSURES (Detai54
FAIR VALUE DISCLOSURES (Details 1) - USD ($) | Dec. 31, 2016 | Dec. 31, 2015 |
Derivative Liabilities | $ 106,840 | $ 0 |
Fair Value, Measurements, Recurring [Member] | ||
Derivative Liabilities | 73,918 | |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Derivative Liabilities | 0 | |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 2 [Member] | ||
Derivative Liabilities | 73,918 | |
Fair Value, Measurements, Recurring [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Derivative Liabilities | $ 0 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | |||
Related Party Transaction, Expenses from Transactions with Related Party | $ 3,759,722 | $ 652,202 | ||
Due to Related Parties | 48,950 | 8,662 | ||
Due from Related Parties | 48,950 | 8,662 | ||
Advisor fees, Acquisition fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 778,137 | 0 | [1] | |
Due to Related Parties | 0 | 0 | ||
Due from Related Parties | 0 | 0 | ||
Advisor fees, Asset management fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 404,561 | 73,200 | ||
Due to Related Parties | 0 | 0 | ||
Due from Related Parties | 43,993 | 73,200 | ||
Advisor fees, Property management fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | [2] | 21,267 | 3,188 | |
Due to Related Parties | [2] | 0 | 0 | |
Due from Related Parties | [2] | 21,267 | 5,486 | |
Advisor fees, Disposition fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 30,000 | 0 | ||
Due to Related Parties | 0 | 0 | ||
Due from Related Parties | 0 | 0 | ||
Reimbursable organizational and offering expenses [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 1,514,688 | 575,814 | ||
Due to Related Parties | 0 | 8,662 | ||
Due from Related Parties | 41,797 | 0 | ||
Fees To Affliates [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 1,212,698 | 73,200 | ||
Due to Related Parties | 0 | 0 | ||
Due from Related Parties | 0 | 0 | ||
Capitalized Acquisition Fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 375,391 | 0 | ||
Due to Related Parties | 48,950 | 0 | ||
Due from Related Parties | 0 | 0 | ||
Financing Coordination Fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 383,790 | 0 | ||
Due to Related Parties | 0 | 0 | ||
Due from Related Parties | 137,800 | 42,960 | ||
Due To Advisor [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | [3] | 223,317 | 0 | |
Due to Related Parties | [3] | 0 | 0 | |
Due from Related Parties | [3] | 270,372 | 47,055 | |
Due to other SSLFO [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | [4] | 0 | 0 | |
Due to Related Parties | [4] | 0 | 0 | |
Due from Related Parties | [4] | 100,477 | 100,477 | |
Due to NNN [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | [3] | 28,571 | 0 | |
Due to Related Parties | [3] | 0 | 0 | |
Due from Related Parties | [3] | $ 28,571 | $ 0 | |
[1] | In lieu of the REIT paying acquisition fees, seller paid the acquisition fees through escrow. | |||
[2] | Property management fees are presented as property operating expenses. | |||
[3] | These costs were incurred in connection with the potential acquisition of a property by Rich Uncles NNN REIT Inc. The property was acquired by the Company. Therefore, the Company has a payable to Rich Uncles NNN REIT, Inc. | |||
[4] | These costs were incurred by SSLFO, an affiliate of the Sponsor, in connection with the organization and offering of the Company’s shares. |
RELATED PARTY TRANSACTIONS (D56
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | |||
Related Party Transaction, Expenses from Transactions with Related Party | $ 3,759,722 | $ 652,202 | ||
Organization and Offering Expenses | 3,424,663 | |||
Organization and Offering Expenses [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 2,555,866 | 1,041,178 | ||
Organization and Offering Expenses Payable | 41,797 | |||
Organization and Offering Expenses Receivable | 8,662 | |||
Advisor fees, Acquisition fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 778,137 | 0 | [1] | |
Related Party Transaction, Description of Transaction | The Company shall pay the Advisor a fee in the amount equal 3.0% of Company’s Contract Purchase Price of its Properties, | |||
Related Party Transaction, Rate | 3.00% | |||
Advisor fees, Acquisition fees [Member] | Maximum [Member] | ||||
Related Party Transaction, Rate | 6.00% | |||
Advisor fees, Asset management fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 404,561 | 73,200 | ||
Related Party Transaction, Rate | 0.05% | |||
Advisor fees, Financing fee [Member] | ||||
Related Party Transaction, Rate | 1.00% | |||
Advisor fees, Property management fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | [2] | $ 21,267 | 3,188 | |
Related Party Transaction, Rate | 1.50% | |||
Advisor fees, Disposition fees [Member] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 30,000 | 0 | ||
Related Party Transaction, Rate | 6.00% | |||
Advisor fees, Disposition fees [Member] | Maximum [Member] | ||||
Related Party Transaction, Rate | 6.00% | |||
Leasing Commission Fees [Member] | ||||
Related Party Transaction, Rate | 3.00% | |||
Operating Expenses [Member] | ||||
Related Party Transaction, Expense Reimbursement Percentage to Average Invested Assets | 2.00% | |||
Related Party Transaction, Expense Reimbursement Percentage to Net Income | 25.00% | |||
Rich Uncles, LLC [Member] | ||||
Repayments of Related Party Debt | $ 2,514,070 | $ 1,051,341 | ||
Advisor or Affiliates [Member] | Advisor fees, Disposition fees [Member] | ||||
Related Party Transaction, Rate | 3.00% | |||
[1] | In lieu of the REIT paying acquisition fees, seller paid the acquisition fees through escrow. | |||
[2] | Property management fees are presented as property operating expenses. |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Payments for Tenant Improvements | $ 1,845,970 | |
Restricted Cash and Cash Equivalents | $ 1,123,470 | $ 0 |
SELECTED QUARTERLY FINANCIAL 58
SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED) (Details) - USD ($) | 3 Months Ended | 12 Months Ended | ||||||||
Dec. 31, 2016 | Sep. 30, 2016 | Jun. 30, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | Jun. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2016 | Dec. 31, 2015 | |
Revenue | $ 2,251,344 | $ 1,909,708 | $ 1,440,457 | $ 813,083 | $ 458,112 | $ 228,014 | $ 168,914 | $ 123,147 | $ 6,414,592 | $ 978,187 |
Net Income (Loss) | $ 630,479 | $ (120,874) | $ (1,245,064) | $ (1,155,929) | $ (133,752) | $ (150,401) | $ (205,154) | $ (352,874) | $ (1,891,388) | $ (842,181) |
Net income (loss) per common share, basic and diluted | $ 0.08 | $ (0.01) | $ (0.20) | $ (0.27) | $ (0.05) | $ (0.09) | $ (0.25) | $ (1.09) | $ (0.28) | $ (0.59) |
Distributions declared per common share | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.1875 | $ 0.375 | $ 0.375 |
SUBSEQUENT EVENTS (Details Text
SUBSEQUENT EVENTS (Details Textual) | Mar. 28, 2017USD ($) | Mar. 15, 2017USD ($)ft² | Mar. 14, 2017USD ($) | Mar. 09, 2017USD ($) | Jun. 29, 2017USD ($)ft² | Apr. 28, 2017USD ($) | Apr. 27, 2017USD ($) | Apr. 20, 2017USD ($)$ / shares | Jan. 20, 2017USD ($)$ / shares | Mar. 31, 2016USD ($) | Jul. 13, 2017USD ($)shares | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) |
Payments to Acquire Real Estate | $ 56,174,678 | $ 34,166,362 | |||||||||||
Proceeds from Sale of Real Estate | $ 1,000,000 | $ 1,000,000 | $ 0 | ||||||||||
Subsequent Event [Member] | |||||||||||||
Dividends Payable, Date Declared | Apr. 20, 2017 | Jan. 20, 2017 | |||||||||||
Dividends Payable, Amount Per Share | $ / shares | $ 0.0020833 | $ 0.0020380 | |||||||||||
Dividends Payable | $ 1,559,038 | $ 1,548,589 | |||||||||||
Dividends Payable, Date to be Paid | Apr. 20, 2017 | Jan. 20, 2017 | |||||||||||
Dividend Reinvested | $ 1,086,992 | $ 1,092,631 | |||||||||||
Debt Instrument, Maturity Date | Apr. 1, 2022 | Mar. 13, 2022 | Mar. 9, 2024 | ||||||||||
Proceeds from Sale of Real Estate | $ 3,434,000 | ||||||||||||
Gains (Losses) on Sales of Investment Real Estate | $ 800,000 | ||||||||||||
Stock Repurchased During Period, Value | $ 1,142,010 | ||||||||||||
Subsequent Event [Member] | Rancho Cordova, CA [Member] | |||||||||||||
Proceeds from Sale of Real Estate | $ 3,298,019 | ||||||||||||
Subsequent Event [Member] | Mortgages [Member] | |||||||||||||
Proceeds from Issuance of First Mortgage Bond | $ 5,527,600 | $ 638,012 | $ 14,850,000 | ||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 4.50% | 4.69% | 4.50% | ||||||||||
Stock Repurchased During Period, Shares | shares | 114,201 | ||||||||||||
Subsequent Event [Member] | Sutter Health [Member] | |||||||||||||
Area of Real Estate Property | ft² | 106,592 | ||||||||||||
Payments to Acquire Real Estate | $ 27,000,000 | ||||||||||||
Business Acquisition, Transaction Costs | $ 602,523 | ||||||||||||
Subsequent Event [Member] | Walgreen Company [Member] | |||||||||||||
Area of Real Estate Property | ft² | 14,490 | ||||||||||||
Payments to Acquire Real Estate | $ 5,125,000 | ||||||||||||
Business Acquisition, Transaction Costs | $ 125,040 |
Schedule III-Real Estate Asse60
Schedule III-Real Estate Assets and Accumulated Depreciation and Amortization (Details) - USD ($) | 12 Months Ended | |||
Dec. 31, 2016 | Dec. 31, 2015 | Dec. 31, 2014 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 40,018,648 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 27,738,008 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 81,522,481 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 109,260,489 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 27,738,008 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 61,437,289 | ||
SEC Schedule III, Real Estate, Gross | 109,270,489 | $ 41,346,556 | $ 3,828,237 | |
SEC Schedule III, Real Estate Accumulated Depreciation | (3,797,990) | (713,268) | $ (145,056) | |
SEC Schedule III, Real Estate Investment Property, Net | $ 63,373,840 | $ 40,633,288 | ||
Chase Bank & Great Clips [Member] | ||||
Real Estate, Acquisition, Description | Chase Bank & Great Clips | |||
Real Estate, Acquisition, Property Location | Antioch, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,998 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Aug. 22, 2014 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 1,924,692 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 649,633 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 3,178,602 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 3,828,235 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 649,633 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 3,178,602 | ||
SEC Schedule III, Real Estate, Gross | 3,828,235 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (759,854) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 3,068,381 | |||
Chevron Gas Station [Member] | Rancho Cordova, CA [Member] | ||||
Real Estate, Acquisition, Description | Chevron Gas Station | |||
Real Estate, Acquisition, Property Location | Rancho Cordova, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,991 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Feb. 6, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 937,863 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 1,662,137 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 2,600,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 937,863 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 1,662,137 | ||
SEC Schedule III, Real Estate, Gross | 2,600,000 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (135,450) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 2,464,550 | |||
Chevron Gas Station [Member] | San Jose, CA [Member] | ||||
Real Estate, Acquisition, Description | Chevron Gas Station | |||
Real Estate, Acquisition, Property Location | San Jose, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,964 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | May 29, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 1,844,383 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 930,617 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 2,775,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 1,844,383 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 930,617 | ||
SEC Schedule III, Real Estate, Gross | 2,775,000 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (62,989) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 2,712,011 | |||
Chevron Gas Station [Member] | Roseville, CA [Member] | ||||
Real Estate, Acquisition, Description | [2] | Chevron Gas Station | ||
Real Estate, Acquisition, Property Location | [2] | Roseville, CA | ||
Real Estate, Acquisition, Ownership Percentage | [2] | 100.00% | ||
Real Estate And Accumulated Depreciation Year Of Construction 1 | [2] | 2,003 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | [2] | Sep. 30, 2015 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | [2] | $ 0 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | [2] | 602,375 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1],[2] | 2,197,625 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | [2] | 2,800,000 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | [2] | 0 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | [2] | 602,375 | ||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1],[2] | 2,197,625 | ||
SEC Schedule III, Real Estate, Gross | [2] | 2,800,000 | ||
SEC Schedule III, Real Estate Accumulated Depreciation | [2] | (123,438) | ||
SEC Schedule III, Real Estate Investment Property, Net | [2] | $ 2,676,562 | ||
Levins [Member] | ||||
Real Estate, Acquisition, Description | Levins | |||
Real Estate, Acquisition, Property Location | Sacramento, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,970 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Aug. 19, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 2,212,470 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 598,913 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 3,151,087 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 3,750,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 598,913 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 3,151,087 | ||
SEC Schedule III, Real Estate, Gross | 3,750,000 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (292,708) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 3,457,292 | |||
Island Pacific Supermarket [Member] | ||||
Real Estate, Acquisition, Description | Island Pacific Supermarket | |||
Real Estate, Acquisition, Property Location | Elk Grove, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 2,012 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Oct. 1, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 2,011,873 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 958,328 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 2,761,672 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 3,720,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 958,328 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 2,761,672 | ||
SEC Schedule III, Real Estate, Gross | 3,720,000 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (207,063) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 3,512,937 | |||
Dollar General [Member] | ||||
Real Estate, Acquisition, Description | Dollar General | |||
Real Estate, Acquisition, Property Location | Bakersfield, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,952 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Nov. 11, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 2,480,276 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 2,218,862 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 3,102,725 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 5,321,587 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 2,218,862 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 3,102,725 | ||
SEC Schedule III, Real Estate, Gross | 5,321,587 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (216,044) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 5,105,543 | |||
Rite Aid [Member] | ||||
Real Estate, Acquisition, Description | Rite Aid | |||
Real Estate, Acquisition, Property Location | Lake Elsinore, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 2,008 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Dec. 7, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 3,907,849 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 2,049,596 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 5,582,136 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 7,631,732 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 2,049,596 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 5,582,136 | ||
SEC Schedule III, Real Estate, Gross | 7,631,732 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (248,521) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 7,383,211 | |||
PMI Preclinical [Member] | ||||
Real Estate, Acquisition, Description | PMI Preclinical | |||
Real Estate, Acquisition, Property Location | San Carlos, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,974 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Dec. 9, 2015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 4,394,926 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 2,940,133 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 5,979,867 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 8,920,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 2,940,133 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 5,979,867 | ||
SEC Schedule III, Real Estate, Gross | 8,920,000 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (214,169) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 8,705,831 | |||
EcoThrift [Member] | ||||
Real Estate, Acquisition, Description | EcoThrift | |||
Real Estate, Acquisition, Property Location | Sacramento, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,982 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Mar. 17, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 2,825,628 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 1,594,857 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 3,433,865 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 5,028,722 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 1,594,857 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 4,486,993 | ||
SEC Schedule III, Real Estate, Gross | 5,028,722 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (191,746) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 4,750,000 | |||
GSA (MSHA) [Member] | ||||
Real Estate, Acquisition, Description | GSA (MSHA) | |||
Real Estate, Acquisition, Property Location | Vacaville, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,987 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Apr. 5, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 1,921,809 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 286,380 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 3,168,497 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 3,454,877 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 286,380 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 2,998,232 | ||
SEC Schedule III, Real Estate, Gross | 3,454,877 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (110,616) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 3,175,000 | |||
PreK San Antonio [Member] | ||||
Real Estate, Acquisition, Description | PreK San Antonio | |||
Real Estate, Acquisition, Property Location | San Antonio, TX | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 2,014 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Apr. 8, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 5,425,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 509,476 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 12,935,515 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 13,444,991 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 509,476 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 11,851,541 | ||
SEC Schedule III, Real Estate, Gross | 13,444,991 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (646,790) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 10,850,000 | |||
Dollar Tree [Member] | ||||
Real Estate, Acquisition, Description | Dollar Tree | |||
Real Estate, Acquisition, Property Location | Morrow, GA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,997 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Apr. 22, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 255,989 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 1,199,011 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 1,455,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 255,989 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 1,248,156 | ||
SEC Schedule III, Real Estate, Gross | 1,455,000 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (64,831) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 1,455,000 | |||
Dinan Cars [Member] | ||||
Real Estate, Acquisition, Description | Dinan Cars | |||
Real Estate, Acquisition, Property Location | Morgan Hill, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 2,001 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Jun. 21, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 2,860,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 724,994 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 4,581,006 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 5,306,000 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 724,994 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 4,651,845 | ||
SEC Schedule III, Real Estate, Gross | 5,306,000 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (205,957) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 5,306,000 | |||
ITW Ripley [Member] | ||||
Real Estate, Acquisition, Description | ITW Ripley | |||
Real Estate, Acquisition, Property Location | El Dorado, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,998 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Aug. 18, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 3,552,247 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 429,668 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 6,155,852 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 6,585,520 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 429,668 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 6,188,204 | ||
SEC Schedule III, Real Estate, Gross | 6,585,520 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (110,536) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 6,441,000 | |||
Solar Turbines [Member] | ||||
Real Estate, Acquisition, Description | Solar Turbines | |||
Real Estate, Acquisition, Property Location | San Diego, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,985 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Jul. 21, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 3,166,787 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 3,081,330 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 2,789,586 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 5,870,916 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 3,081,330 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 5,481,198 | ||
SEC Schedule III, Real Estate, Gross | 5,870,916 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (86,700) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 5,870,916 | |||
Amec Foster [Member] | ||||
Real Estate, Acquisition, Description | Amec Foster | |||
Real Estate, Acquisition, Property Location | San Diego, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,985 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Jul. 21, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 3,335,091 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 3,551,615 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 2,631,320 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 6,182,935 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 3,551,615 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 5,697,402 | ||
SEC Schedule III, Real Estate, Gross | 6,182,935 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (89,453) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 6,182,935 | |||
Dollar General Big Spring [Member] | ||||
Real Estate, Acquisition, Description | Dollar General Big Spring | |||
Real Estate, Acquisition, Property Location | Big Spring, TX | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 2,015 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Nov. 4, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 337,204 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 937,401 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 1,274,605 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 337,204 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 1,161,647 | ||
SEC Schedule III, Real Estate, Gross | 1,274,605 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (3,796) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 1,274,605 | |||
Gap [Member] | ||||
Real Estate, Acquisition, Description | Gap | |||
Real Estate, Acquisition, Property Location | Rocklin, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,998 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Dec. 1, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 1,661,831 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 6,224,989 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 7,886,820 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 1,661,831 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 7,209,629 | ||
SEC Schedule III, Real Estate, Gross | 7,886,820 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (13,308) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 7,886,820 | |||
L-3 Communications [Member] | ||||
Real Estate, Acquisition, Description | L-3 Communications | |||
Real Estate, Acquisition, Property Location | San Diego, CA | |||
Real Estate, Acquisition, Ownership Percentage | 100.00% | |||
Real Estate And Accumulated Depreciation Year Of Construction 1 | 1,984 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Date Acquired | Dec. 23, 2016 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Amount of Encumbrances | $ 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Land | 2,504,578 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Initial Cost of Buildings and Improvements | [1] | 8,918,971 | ||
Real Estate and Accumulated Depreciation, Initial Cost of Land, Buildings and Improvements | 11,423,549 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Costs Capitalized Subsequent to Acquisition, Improvements | 0 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Land | 2,504,578 | |||
SEC Schedule III, Real Estate and Accumulated Depreciation, Carrying Amount of Buildings and Improvements | [1] | 10,462,442 | ||
SEC Schedule III, Real Estate, Gross | 11,423,549 | |||
SEC Schedule III, Real Estate Accumulated Depreciation | (14,021) | |||
SEC Schedule III, Real Estate Investment Property, Net | $ 10,171,564 | |||
[1] | Building and improvements include tenant origination and absorption costs | |||
[2] | The Company owns an undivided 70.14% interest through a tenancy in common agreement that was entered into in March 2016. |
Schedule III-Real Estate Asse61
Schedule III-Real Estate Assets and Accumulated Depreciation and Amortization (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Real estate investments: | ||
Balance at beginning of year | $ 41,346,556 | $ 3,828,237 |
Acquisitions | 67,913,933 | 37,518,319 |
Balance at end of year | 109,270,489 | 41,346,556 |
Accumulated depreciation and amortization: | ||
Balance at begnning of year | (713,268) | (145,056) |
Depreciation and amortization expense | (3,084,722) | (568,212) |
Balance at end of year | (3,797,990) | (713,268) |
Real estate investments, net: | $ 63,373,840 | $ 40,633,288 |
Schedule III-Real Estate Asse62
Schedule III-Real Estate Assets and Accumulated Depreciation and Amortization (Details 2) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
Real estate depreciation and amortization | $ 3,084,722 | $ 568,212 |
Website amortization | 50,257 | 200,226 |
Depreciation, Depletion and Amortization | $ 3,134,979 | $ 768,122 |
Schedule III-Real Estate Asse63
Schedule III-Real Estate Assets and Accumulated Depreciation and Amortization (Details Textual) - USD ($) | 12 Months Ended | |
Dec. 31, 2016 | Dec. 31, 2015 | |
SEC Schedule III, Real Estate, Federal Income Tax Basis | $ 0 | |
Real Estate Investment Property, at Cost | 109,260,489 | $ 41,346,556 |
Domestic Tax Authority [Member] | ||
Real Estate Investment Property, at Cost | $ 0 | |
Building [Member] | Maximum [Member] | ||
Property, Plant and Equipment, Useful Life | 52 years | |
Building [Member] | Minimum [Member] | ||
Property, Plant and Equipment, Useful Life | 15 years | |
Building Improvements [Member] | Maximum [Member] | ||
Property, Plant and Equipment, Useful Life | 21 years | |
Building Improvements [Member] | Minimum [Member] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Tenant Improvement [Member] | ||
Property, Plant and Equipment, Useful Life | 15 years | |
Property, Plant and Equipment, Estimated Useful Lives | Shorter of 15 years or remaining contractual lease term | |
Tenant Origination and Absorption Costs [Member] | ||
Property, Plant and Equipment, Estimated Useful Lives | Remaining contractual lease term with consideration as to above- and below-market extension options for above- and below-market lease intangibles |