Document and Entity Information
Document and Entity Information - shares | 12 Months Ended | |
Dec. 31, 2022 | Mar. 29, 2023 | |
Document And Entity Information [Line Items] | ||
Document Type | 10-K | |
Amendment Flag | false | |
Document Period End Date | Dec. 31, 2022 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | FY | |
Trading Symbol | ICR PR A | |
Entity Registrant Name | INPOINT COMMERCIAL REAL ESTATE INCOME, INC. | |
Entity Central Index Key | 0001690012 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Well-known Seasoned Issuer | No | |
Entity Voluntary Filers | No | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
ICFR Auditor Attestation Flag | false | |
Entity Shell Company | false | |
Entity File Number | 001-40833 | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 32-0506267 | |
Entity Address, Address Line One | 2901 Butterfield Road | |
Entity Address, City or Town | Oak Brook | |
Entity Address, State or Province | IL | |
Entity Address, Postal Zip Code | 60523 | |
City Area Code | 800 | |
Local Phone Number | 826-8228 | |
Document Annual Report | true | |
Document Transition Report | false | |
Title of 12(b) Security | 6.75% Series A Cumulative Redeemable Preferred Stock, par value $0.001 | |
Security Exchange Name | NYSE | |
Auditor Name | KPMG LLP | |
Auditor Location | Chicago, IL | |
Auditor Firm ID | 185 | |
Class P Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 8,562,778 | |
Class A Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 745,887 | |
Class T Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 290,345 | |
Class D Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 48,015 | |
Class I Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 467,447 | |
Class S Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 0 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
ASSETS | |||
Cash and cash equivalents | $ 29,408 | $ 57,268 | |
Commercial mortgage loans at cost, net of allowance for loan loss of $3,588 and $0, respectively | 842,278 | [1] | 665,498 |
Real estate owned, net of depreciation | 31,215 | 31,535 | |
Finance lease right of use asset, net of amortization | 5,382 | 5,454 | |
Deferred debt finance costs | 872 | 1,202 | |
Accrued interest receivable | 3,121 | 1,416 | |
Prepaid expenses and other assets | 2,219 | 2,055 | |
Total assets | 914,495 | 764,428 | |
Liabilities: | |||
Repurchase agreements | 488,086 | 307,083 | |
Credit facility payable | 18,380 | 14,350 | |
Loan participations sold, net | 99,420 | 109,772 | |
Finance lease liability | 17,457 | 17,105 | |
Due to related parties | 2,197 | 2,894 | |
Accrued interest payable | 1,499 | 364 | |
Distributions payable | 1,047 | 1,137 | |
Accrued expenses | 7,852 | 4,578 | |
Total liabilities | 635,938 | 457,283 | |
Stockholders' Equity: | |||
6.75% Series A Cumulative Redeemable Preferred Stock, $0.001 par value, 4,025,000 shares authorized, 3,548,696 and 3,600,000 shares issued and outstanding as of December 31, 2022 and December 31, 2021, respectively | 4 | 4 | |
Additional paid in capital (net of offering costs of $30,427 and $29,534 as of December 31, 2022 and 2021, respectively) | 339,470 | 359,406 | |
Accumulated deficit | (60,927) | (52,275) | |
Total stockholders' equity | 278,557 | 307,145 | |
Total liabilities and stockholders’ equity | 914,495 | 764,428 | |
Class P Common Stock | |||
Stockholders' Equity: | |||
Common stock | 9 | 9 | |
Class A Common Stock | |||
Stockholders' Equity: | |||
Common stock | 1 | 1 | |
Class T Common Stock | |||
Stockholders' Equity: | |||
Common stock | 0 | 0 | |
Class S Common Stock | |||
Stockholders' Equity: | |||
Common stock | 0 | 0 | |
Class D Common Stock | |||
Stockholders' Equity: | |||
Common stock | 0 | 0 | |
Class I Common Stock | |||
Stockholders' Equity: | |||
Common stock | $ 0 | $ 0 | |
[1] Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Allowance for loan loss | $ 3,588 | $ 0 |
Additional paid in capital, offering costs | $ 30,427 | $ 29,534 |
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Class P Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares, issued | 8,562,777 | 9,492,939 |
Common stock, shares, outstanding | 8,562,777 | 9,492,939 |
Class A Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares, issued | 743,183 | 659,270 |
Common stock, shares, outstanding | 743,183 | 659,270 |
Class T Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares, issued | 286,341 | 388,099 |
Common stock, shares, outstanding | 286,341 | 388,099 |
Class S Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares, issued | 0 | 0 |
Common stock, shares, outstanding | 0 | 0 |
Class D Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares, issued | 47,888 | 47,298 |
Common stock, shares, outstanding | 47,888 | 47,298 |
Class I Common Stock | ||
Common stock, par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 500,000,000 | 500,000,000 |
Common stock, shares, issued | 452,667 | 380,218 |
Common stock, shares, outstanding | 452,667 | 380,218 |
6.75% Series A Cumulative Redeemable Preferred Stock | ||
Preferred stock, par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 4,025,000 | 4,025,000 |
Percentage of cumulative redeemable preferred stock | 6.75% | 6.75% |
Preferred stock, shares issued | 3,548,696 | 3,600,000 |
Preferred stock, shares outstanding | 3,548,696 | 3,600,000 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Interest income: | |||
Interest income | $ 44,641 | $ 28,988 | $ 33,490 |
Less: Interest expense | (21,371) | (8,801) | (10,317) |
Net interest income | 23,270 | 20,187 | 23,173 |
Revenue from real estate owned | 14,774 | 8,109 | 972 |
Total income | 38,044 | 28,296 | 24,145 |
Operating expenses: | |||
Advisory fee | 3,692 | 3,217 | 5,528 |
Debt finance costs | 1,708 | 1,492 | 1,331 |
Directors compensation | 81 | 73 | 94 |
Professional service fees | 914 | 1,028 | 2,031 |
Real estate owned operating expenses | 15,369 | 10,344 | 2,709 |
Depreciation and amortization | 1,130 | 1,089 | 405 |
Other expenses | 1,383 | 1,180 | 921 |
Total operating expenses | 24,277 | 18,423 | 13,019 |
Other (loss) income: | |||
Provision for loan losses | (3,588) | (4,726) | |
Realized loss on sale of commercial loan | (375) | ||
Unrealized gain in value of real estate securities | 211 | ||
Realized loss on the sale of real estate securities | (35,020) | ||
Total other (loss) income | (3,588) | (39,910) | |
Net income (loss) | 10,179 | 9,873 | (28,784) |
Gain on repurchase and retirement of preferred stock | (306) | ||
Net income (loss) attributable to common stockholders | $ 4,430 | $ 8,219 | $ (28,784) |
Net income (loss) per share attributable to common stockholders, basic | $ 0.42 | $ 0.72 | $ (2.49) |
Net income (loss) per share attributable to common stockholders, diluted | $ 0.42 | $ 0.72 | $ (2.49) |
Weighted average number of shares | |||
Basic | 10,605,242 | 11,480,517 | 11,561,828 |
Diluted | 10,606,072 | 11,481,464 | 11,561,828 |
Series A Preferred Stock | |||
Other (loss) income: | |||
Series A Preferred Stock dividends | $ 6,055 | $ 1,654 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($) $ in Thousands | Total | Preferred Stock Series A Preferred Stock | Common Stock Class P Common Stock | Common Stock Class A Common Stock | Additional Paid in Capital | Accumulated Deficit |
Balance at Dec. 31, 2019 | $ 256,166 | $ 10 | $ 265,963 | $ (9,807) | ||
Proceeds from issuance of common stock | 24,269 | $ 1 | 24,268 | |||
Offering costs | (2,246) | (2,246) | ||||
Net income (loss) | (28,784) | (28,784) | ||||
Common stock distributions declared | (8,662) | (8,662) | ||||
Distribution reinvestment | 245 | 245 | ||||
Redemptions | (763) | (763) | ||||
Equity-based compensation | 31 | 31 | ||||
Balance at Dec. 31, 2020 | 240,256 | 10 | 1 | 287,498 | (47,253) | |
Proceeds from issuance of common stock | 199 | 199 | ||||
Proceeds from issuance of preferred stock | 90,000 | $ 4 | 89,996 | |||
Offering costs | (4,570) | (4,570) | ||||
Net income (loss) | 9,873 | 9,873 | ||||
Common stock distributions declared | (13,241) | (13,241) | ||||
Preferred stock distributions declared | (1,654) | (1,654) | ||||
Distribution reinvestment | 583 | 583 | ||||
Redemptions | (14,335) | (1) | (14,334) | |||
Equity-based compensation | 34 | 34 | ||||
Balance at Dec. 31, 2021 | 307,145 | 4 | 9 | 1 | 359,406 | (52,275) |
Proceeds from issuance of common stock | 4,529 | 4,529 | ||||
Repurchase and retirement of preferred stock | (977) | (1,283) | 306 | |||
Offering costs | (1,572) | (1,572) | ||||
Net income (loss) | 10,179 | 10,179 | ||||
Common stock distributions declared | (13,082) | (13,082) | ||||
Preferred stock distributions declared | (6,055) | (6,055) | ||||
Distribution reinvestment | 725 | 725 | ||||
Redemptions | (22,367) | (22,367) | ||||
Equity-based compensation | 32 | 32 | ||||
Balance at Dec. 31, 2022 | $ 278,557 | $ 4 | $ 9 | $ 1 | $ 339,470 | $ (60,927) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Cash flows from operating activities | |||
Net income (loss) | $ 10,179 | $ 9,873 | $ (28,784) |
Adjustments to reconcile net income (loss) to cash provided by operations: | |||
Net realized loss on real estate securities | 35,020 | ||
Net unrealized gain on real estate securities | (211) | ||
Provision for loan losses | 3,588 | 4,726 | |
Realized loss on sale of commercial loan | 375 | ||
Depreciation and amortization expense | 1,130 | 1,089 | 405 |
Reduction in the carrying amount of the right-of-use asset | 72 | 71 | 24 |
Amortization of equity-based compensation | 32 | 34 | 31 |
Amortization of debt finance costs to operating expense | 1,708 | 1,492 | 1,331 |
Amortization of debt finance costs to interest expense | 120 | 69 | 79 |
Amortization of bond discount | (307) | ||
Amortization of origination fees | (217) | (702) | (1,534) |
Amortization of deferred exit fees | 6 | 62 | |
Amortization of loan extension fees | (317) | (314) | |
Changes in assets and liabilities: | |||
Accrued interest receivable | (1,705) | (248) | 268 |
Accrued expenses | 3,274 | 985 | 487 |
Loan fees payable | (401) | 346 | |
Accrued interest payable | 1,487 | 387 | (397) |
Due to related parties | (671) | 456 | 648 |
Prepaid expenses and other assets | (164) | (1,153) | (571) |
Net cash provided by operating activities | 18,516 | 11,644 | 11,998 |
Cash flows from investing activities: | |||
Origination of commercial loans | (300,576) | (337,033) | (69,135) |
Loan extension fees received on commercial loans | 584 | 231 | |
Principal repayments of commercial loans | 120,240 | 114,558 | 99,727 |
Proceeds from sale of commercial loan | 9,625 | ||
Acquisition of real estate owned and capital expenditures | (810) | (150) | 347 |
Real estate securities sold | 121,189 | ||
Real estate securities principal pay-down | 2,178 | ||
Net cash (used in) provided by investing activities | (180,562) | (222,394) | 163,931 |
Cash flows from financing activities: | |||
Proceeds from issuance of common stock | 4,529 | 199 | 24,269 |
Proceeds from issuance of preferred stock | 90,000 | ||
Redemptions of common stock | (22,367) | (14,335) | (763) |
Repurchase of preferred stock | (977) | ||
Payment of offering costs | (1,680) | (4,655) | (1,844) |
Proceeds from repurchase agreements | 258,990 | 194,101 | 578,182 |
Principal repayments of repurchase agreements | (78,025) | (177,703) | (730,830) |
Proceeds from credit facility | 18,380 | 14,350 | |
Principal repayments of credit facility | (14,350) | ||
Proceeds from sale of loan participations | 5,042 | 109,772 | |
Principal repayments of loan participations | (15,394) | ||
Debt finance costs | (1,460) | (1,776) | (1,224) |
Distributions paid to common stockholders | (12,447) | (12,388) | (9,251) |
Distributions paid to preferred stockholders | (6,055) | (1,654) | |
Net cash provided by (used in) financing activities | 134,186 | 195,911 | (141,461) |
Net change in cash, cash equivalents and restricted cash | (27,860) | (14,839) | 34,468 |
Cash, cash equivalents and restricted cash at beginning of period | 57,268 | 72,107 | 37,639 |
Cash, cash equivalents and restricted cash at end of period | 29,408 | 57,268 | 72,107 |
Supplemental disclosure of cash flow information: | |||
Amortization of deferred exit fees due to related party | 82 | 430 | 346 |
Interest paid | 20,116 | 8,729 | 10,677 |
Deferred interest capitalized on commercial loan | 386 | ||
Transfer of commercial loan on deed-in-lieu of foreclosure to real estate owned | 19,774 | ||
Accrued stockholder servicing fee due to related party | (108) | (85) | 401 |
Distribution reinvestment | $ 725 | $ 583 | $ 245 |
Organization and Business Opera
Organization and Business Operations | 12 Months Ended |
Dec. 31, 2022 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Business Operations | Note 1 – Organization and B usiness Operations InPoint Commercial Real Estate Income, Inc. (the “Company”) was incorporated in Maryland on September 13, 2016 to originate, acquire and manage a diversified portfolio of commercial real estate (“CRE”) investments primarily comprised of (i) CRE debt, including (a) primarily floating rate first mortgage loans, and (b) subordinate mortgage and mezzanine loans, and participations in such loans and (ii) floating rate CRE securities, such as commercial mortgage-backed securities (“CMBS”), and senior unsecured debt of publicly traded real estate investment trusts (“REITs”). The Company may also invest in select equity investments in single-tenant, net leased properties. Substantially all of the Company’s business is conducted through InPoint REIT Operating Partnership, LP (the “Operating Partnership”), a Delaware limited partnership. The Company is the sole general partner and directly or indirectly holds all of the limited partner interests in the Operating Partnership. The Company has elected to be taxed as a REIT for U.S. federal income tax purposes. The Company is externally managed by Inland InPoint Advisor, LLC (the “Advisor”), a Delaware limited liability company formed in August 2016 that is a wholly owned indirect subsidiary of Inland Real Estate Investment Corporation, a member of The Inland Real Estate Group of Companies, Inc. The Advisor is responsible for coordinating the management of the day-to-day operations and originating, acquiring and managing the Company’s CRE investment portfolio, subject to the supervision of the Company’s board of directors (the “Board”). The Advisor performs its duties and responsibilities as the Company’s fiduciary pursuant to an amended and restated advisory agreement dated July 1, 2021 among the Company, the Advisor and the Operating Partnership (the “Advisory Agreement”). The Advisor has delegated certain of its duties to SPCRE InPoint Advisors, LLC (the “Sub-Advisor”), a Delaware limited liability company formed in September 2016 that is a wholly owned subsidiary of Sound Point CRE Management, LP, pursuant to an amended and restated sub-advisory agreement between the Advisor and the Sub-Advisor dated July 1, 2021. Among other duties, the Sub-Advisor has the authority to identify, negotiate, acquire and originate the Company’s investments and provide portfolio management, disposition, property management and leasing services to the Company. Notwithstanding such delegation to the Sub-Advisor, the Advisor retains ultimate responsibility for the performance of all the matters entrusted to it under the Advisory Agreement, including those duties which the Advisor has not delegated to the Sub-Advisor such as (i) valuation of the Company’s assets and calculation of the Company’s net asset value (“NAV”); (ii) management of the Company’s day-to-day operations; (iii) preparation of stockholder reports and communications and arrangement of the Company’s annual stockholder meetings; and (iv) advising the Company regarding its initial qualification as a REIT for U.S. federal income tax purposes and monitoring its ongoing compliance with the REIT qualification requirements thereafter. On October 25, 2016, the Company commenced a private offering (the “Private Offering”) of up to $ 500,000 in shares of Class P common stock (“Class P Shares”). Inland Securities Corporation, an affiliate of the Advisor (the “Dealer Manager”), was the dealer manager for the Private Offering. On June 28, 2019, the Company terminated the Private Offering. The Company continued to accept Private Offering subscription proceeds through July 16, 2019 from subscription agreements executed no later than June 28, 2019. The Company issued 10,258,094 Class P Shares in the Private Offering, resulting in gross proceeds of $ 276,681 . On March 22, 2019, the Company filed a Registration Statement on Form S-11 (File No. 333-230465) (the “Registration Statement”) with the Securities and Exchange Commission (the “SEC”) to register up to $ 2,350,000 in shares of common stock (the “IPO”). On May 3, 2019, the SEC declared effective the Registration Statement and the Company commenced the IPO. The purchase price per share for each class of common stock in the IPO varies and generally equals the prior month’s NAV per share, as determined monthly, plus applicable upfront selling commissions and dealer manager fees. The Dealer Manager serves as the Company’s exclusive dealer manager for the IPO on a best efforts basis. On April 28, 2022, the Company filed a Registration Statement of Form S-11 (File No. 333-264540) with the SEC to register up to $ 2,200,000 in shares of common stock, which was declared effective by the SEC on November 2, 2022 (the "Second Public Offering" and collectively with the IPO, the "Public Offerings"). On March 24, 2020, the Board suspended (i) the sale of shares in the IPO, (ii) the operation of the share repurchase plan (the “SRP”), (iii) the payment of distributions to the Company’s stockholders, and (iv) the operation of the distribution reinvestment plan (the “DRP”), effective as of April 6, 2020. In determining to take these actions, the Board considered various factors, including the impact of the COVID-19 pandemic on the economy, the inability to accurately calculate the Company’s NAV per share due to uncertainty, volatility and lack of liquidity in the market, the Company’s need for liquidity due to financing challenges related to additional collateral required by the banks that regularly finance the Company’s assets and these uncertain and rapidly changing economic conditions. Though the Company did not calculate the NAV for the months of March through May 2020, the Advisor resumed calculating the NAV beginning as of June 30, 2020 following its determination that volatility in the market for the Company’s investments had declined and the U.S. economic outlook had improved. In August 2020, the Company resumed paying distributions monthly to stockholders of record for all classes of its common stock. On October 1, 2020, the SEC declared effective the Company’s post-effective amendment to the Registration Statement, thereby permitting the Company to resume offers and sales of shares of common stock in the IPO, including through the DRP. On March 1, 2021, the SRP was reinstated for the Company’s stockholders requesting repurchase of shares as a result of the death or qualified disability of the holder, and on July 1, 2021, the SRP was reinstated for all stockholders. In accordance with the terms of the SRP that allow the Company to repurchase fewer shares than the maximum amount permitted under the SRP, the Company repurchased fewer shares than the maximum amount permitted for the months of July, August, and September 2021 as directed by the Board. Beginning on October 1, 2021, the total amount of aggregate repurchases of shares is limited as set forth in the SRP (no more than 2 % of the Company’s aggregate NAV per month as of the last day of the previous calendar month and no more than 5 % of the Company’s aggregate NAV per calendar quarter with NAV measured as of the last day of the previous calendar quarter). Notwithstanding the foregoing, the Company may repurchase fewer shares than these limits in any month, or none . Further, the Board may modify, suspend or terminate the SRP if it deems such action to be in the Company’s best interest and the best interest of its stockholders. On September 22, 2021, the Company completed an underwritten public offering of 3,500,000 shares of its 6.75 % Series A Cumulative Redeemable Preferred Stock, par value $ 0.001 per share (the “Series A Preferred Stock”), with a liquidation preference of $ 25.00 per share (the “Preferred Stock Offering”). In addition, on October 15, 2021, Raymond James & Associates, Inc., as a representative of the underwriters, partially exercised their over-allotment option to purchase an additional 100,000 shares of Series A Preferred Stock. The Series A Preferred Stock were issued and sold pursuant to an effective registration statement on Form S-11 (File No. 333-258802) filed with the SEC. The Company received proceeds in the Preferred Stock Offering of $ 86,310 , after underwriter’s discount and issuance costs, and contributed the net proceeds to the Operating Partnership in exchange for an equivalent number of Series A units in the Operating Partnership. In connection with the Preferred Stock Offering, Regulation M under the Securities Exchange Act of 1934, as amended, prohibited the Company from selling its shares of common stock in the primary portion of the IPO and repurchasing its shares of common stock through the SRP during the applicable restricted period. After careful consideration of the regulatory requirements, the Board unanimously approved the temporary suspension of the sale of the Company's shares of common stock in the primary portion of the IPO and the operation of the SRP, each effective at 9:30 a.m., Eastern Time, on September 7, 2021, until 9:30 a.m., Eastern Time, on September 15, 2021. For more information on the Preferred Stock Offering, see “Note 7 – Stockholders’ Equity”. Please refer to “Note 16 – Subsequent Events” and Part II, “Item 1A – Risk Factors” for updates to the Company’s business after December 31, 2022. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Basis of Accounting The accompanying consolidated financial statements and related footnotes have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of income and expenses during the reported periods. Actual results could differ from such estimates. Certain amounts in the prior period consolidated financial statements have been reclassified to conform with the current year presentation. Principles of Consolidation The Company consolidates all entities that the Company controls through either majority ownership or voting rights. The accompanying consolidated financial statements include the accounts of the Company and the Operating Partnership. All intercompany accounts and transactions have been eliminated in consolidation. In determining whether the Company has a controlling financial interest in a joint venture and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the other partners or members as well as whether the entity is a variable interest entity (“VIE”) for which the Company is the primary beneficiary. The Company has determined the Operating Partnership is a VIE of which the Company is the primary beneficiary. Substantially all of the Company’s assets and liabilities are held by the Operating Partnership. Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents include funds on deposit with financial institutions, including demand deposits with financial institutions with original maturities of three months or less. The account balance may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage limits and, as a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage limits. The Company believes that the risk will not be significant, as the Company does not anticipate the financial institutions’ non-performance. Restricted cash represents cash the Company is required to hold in a segregated account as additional collateral on real estate securities repurchase agreements. As of December 31, 2022 and 2021, no restricted cash was held by the Company. Credit Facility Payable The Company has a credit facility to finance the acquisition or origination of commercial mortgage loans. This credit facility, when drawn upon, is accounted for as debt. The fees paid for this credit facility are recorded in deferred debt finance costs on the consolidated balance sheet and are amortized straight line over the period of the agreement to debt finance costs on the consolidated statement of operations. For further information on the credit facility, see “Note 5 – Repurchase Agreements and Credit Facilities.” Real Estate Securities at Fair Value The Company’s real estate securities were comprised of CMBS and were accounted for in accordance with ASC Topic 320, Investments — Debt and Equity Securities (“ASC 320”). The Company has chosen to make a fair value option election pursuant to ASC Topic 825 , Financial Instruments for its securities and, therefore, its real estate securities are recorded at fair value on the consolidated balance sheets while they were still held by the Company. The periodic changes in fair value were recorded in period earnings on the consolidated statements of operations as a component of net unrealized gain (loss) in value of real estate securities. These investments generally meet the requirements to be classified as available-for-sale under ASC 320, which requires the securities to be carried at fair value on the balance sheet with changes in fair value recorded to other comprehensive income on the Company’s consolidated statement of changes in stockholders’ equity. Electing the fair value option allowed the Company to record changes in fair value of its investments in the consolidated statements of operations which, in management’s view, more appropriately reflected the results of operations for periods during which they were held. The Company recorded its transactions in securities on a trade date basis and recognizes realized gains and losses on securities transactions on an identified cost basis. The Company sold all of its real estate securities during the year ended December 31, 2020 and held no real estate securities as of December 31, 2022 and 2021. Commercial Mortgage Loans Held for Investment and Allowance for Loan Losses Commercial mortgage loans are held for investment purposes and are anticipated to be held until maturity. Accordingly, they are carried at cost, net of unamortized loan fees and origination costs, and premiums or discounts. Commercial mortgage loans that are deemed to be impaired will be carried at amortized cost less a specific allowance for loan losses. Interest income is recorded on the accrual basis and related discounts, premiums and net deferred fees or costs on investments are amortized over the life of the investment using the effective interest method. Amortization is reflected as an adjustment to interest income in the Company’s consolidated statements of operations. Upon measurement of impairment, the Company records an allowance for loan losses to reduce the carrying value of the loan with a corresponding charge through the provision for loan losses on the Company’s consolidated statements of operations. The allowance for loan losses reflects management's estimate of loan losses inherent in the loan portfolio as of the balance sheet date. The Company uses a uniform process for determining its allowance for loan losses. The allowance for loan losses includes an asset-specific component and may include a general, formula-based component when the portfolio is determined to be of sufficient size to warrant such a reserve. The asset-specific reserve component relates to reserves for losses on individual impaired loans. The Company considers a loan to be impaired when, based upon current information and events, it believes that it is probable that the Company will be unable to collect all amounts due under the contractual terms of the loan agreement. This assessment is made on an individual loan basis each quarter based on such factors as payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographic location, as well as national and regional economic factors. A reserve is established for an impaired loan when the present value of payments expected to be received, observable market prices or the estimated fair value of the collateral (for loans that are dependent on the collateral for repayment) is lower than the carrying value of that loan. For collateral dependent impaired loans, impairment is measured using the estimated fair value of collateral less the estimated cost to sell. Valuations are performed or obtained at the time a loan is determined to be impaired and designated non-performing, and they are updated if circumstances indicate that a significant change in value has occurred. The Advisor generally will use the income approach through internally developed valuation models to estimate the fair value of the collateral for such loans. In more limited cases, the Advisor will obtain external “as is” appraisals for loan collateral, generally when third party participations exist. General reserves are recorded when (i) available information as of each balance sheet date indicates that it is probable a loss has occurred in the portfolio and (ii) the amount of the loss can be reasonably estimated. The Company’s policy is to estimate loss rates based on actual losses experienced, if any, or based on historical realized losses experienced in the industry if the Company has not experienced any losses. Current collateral and economic conditions affecting the probability and severity of losses are taken into account when establishing the allowance for loan losses. The Company performs a comprehensive analysis of its loan portfolio and assigns risk ratings to loans that incorporate management's current judgments about their credit quality based on all known and relevant internal and external factors that may affect collectability. The Company considers, among other things, payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographic location, as well as national and regional economic factors. This methodology results in loans being segmented by risk classification into risk rating categories that are associated with estimated probabilities of default and principal loss. Ratings range from “ 1 ” to “ 5 ” with “1” representing the lowest risk of loss and “5” representing the highest risk of loss. Loans are generally placed on non-accrual status when principal or interest payments are past due 90 days or more or when there is reasonable doubt that principal or interest will be collected in full. Accrued and unpaid interest is generally reversed against interest income in the period the loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management's judgment regarding the borrower's ability to make pending principal and interest payments. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management's judgment, are likely to remain current. The Company may make exceptions to placing a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection. As of December 31, 2022 and 2021 , the Company had $ 842,278 and $ 665,498 of commercial mortgage loans held for investment, respectively. The Company recorded an allowance for loan losses of $ 3,588 as of December 31, 2022. See Note 3 – “Commercial Mortgage Loans Held for Investment - Allowance for Loan Losses" and See Note 16 – “Subsequent Events - Loan Loss Reserve" for further information. The Company did no t record any allowance for loan losses as of December 31, 2021 as the Company did not consider any loan losses to be probable at that time. Interest Income Interest income on CMBS, which includes accretion of discounts and amortization of premiums on such CMBS, and on commercial loans, which includes origination fees paid by borrowers, is recognized over the life of the investment using the effective interest method. Management estimates, at the time of purchase, the future expected cash flows and determines the effective interest rate based on these estimated cash flows and the Company’s purchase price. As needed, these estimated cash flows are updated and a revised yield is computed based on the current amortized cost of the investment. In estimating these cash flows, there are a number of assumptions that are subject to uncertainties and contingencies, including the rate and timing of principal payments (prepayments, repurchases, defaults and liquidations), the pass through or coupon rate and interest rate fluctuations. In addition, management must use its judgment to estimate interest payment shortfalls due to delinquencies on the underlying mortgage loans. These uncertainties and contingencies are difficult to predict and are subject to future events that may impact management’s estimates and the Company’s interest income. Real Estate Owned Real estate owned (“REO”) represents real estate acquired by the Company through foreclosure, deed-in-lieu of foreclosure, or purchase. For real estate acquired by the Company through foreclosure or deed-in-lieu of foreclosure, REO assets are recorded at fair value at acquisition and are presented net of accumulated depreciation. For REO assets acquired through purchase, REO assets are recorded at cost at acquisition and are presented net of accumulated depreciation. REO assets are depreciated using the straight-line method over estimated useful lives of up to 40 years for buildings and improvements and up to 15 years for furniture, fixtures and equipment. Renovations and/or replacements that improve or extend the life of the real estate asset are capitalized and depreciated over their estimated useful lives. Revenue from Real Estate Owned Revenue from REO represents revenue associated with the operations of a hotel property classified as REO. Revenue from the operation of the hotel property is recognized when guestrooms are occupied, services have been rendered or fees have been earned. Revenues are recorded net of any discounts and sales and other taxes collected from customers. Revenues consist of room sales, food and beverage sales and other hotel revenues. Leases Finance lease right of use ("ROU") assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets are recorded based on the fair value of the underlying property. Lease liabilities are recognized at commencement date based on the present value of fixed lease payments over the lease term. Leases will be classified as either a finance or operating lease, with such classification affecting the pattern and classification of expense recognition in the consolidated statements of operations. For leases greater than 12 months, the Company determines, at the inception of the contract, if the arrangement meets the classification criteria for an operating or finance lease. For leases that have extension options, which can be exercised at the Company's discretion, management uses judgment to determine if it is reasonably certain that such extension options will be elected. If the extension options are reasonably certain to occur, the Company includes the extended term's lease payments in the calculation of the respective lease liability. Total lease expense is recognized as interest on the finance lease liability and amortization of the ROU asset on a straight-line basis over the lease term. The incremental borrowing rate used to discount the lease liability is determined at commencement of the lease, or upon modification of the lease, as the interest rate a lessee would have to pay to borrow on a fully collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. The Company's incremental borrowing rate considers information at both the corporate and property level and analysis of current market conditions for obtaining new financings. As of December 31, 2022, the Company had one finance lease assumed as part of a deed-in-lieu of foreclosure of a hotel property during August 2020. Fair Value Measurements The Company estimates fair value using available market information and valuation methodologies it believes to be appropriate for these purposes. The Company defines fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 , Fair Value Measurements establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy consists of three broad levels, which are described below: • Level I - Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. • Level II - Inputs (other than quoted prices included in Level I) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. • Level III - Unobservable inputs which reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. The determination of where an asset or liability falls in the above hierarchy requires judgment and factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. The Company is required by GAAP to disclose fair value information about financial instruments that are not otherwise reported at fair value in its consolidated balance sheets, to the extent it is practicable to estimate a fair value for those instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments. Organization and Offering Expenses The Company conducted an IPO that commenced following the conclusion of the Private Offering on June 28, 2019. The IPO concluded and the Second Public Offering began when the S-11 for the Second Public Offering was declared effective by the SEC on November 2, 2022 (File No. 333-264540). For classes of shares sold in the Public Offerings, the purchase price per share is based on a monthly NAV published around the 15 th of the month preceding its effective date with the valuation based on the end of the previous month. For the Private Offering, the purchase price per Class P Share was equal to $ 25.00 (the “Transaction Price”) plus applicable selling commissions, dealer manager fees and organization and offering expenses, resulting in a total purchase price of $ 27.38 per Class P Share if maximum selling commissions, dealer manager fees and organization and offering expenses were paid. The Dealer Manager was the dealer manager for the Private Offering and the IPO and is the dealer manager for the Second Public Offering. Organization and offering expenses include all expenses incurred in connection with the Private Offering and Public Offerings. Organization and offering expenses (other than selling commissions, dealer manager fees and stockholder servicing fees) of the Company may be paid by the Advisor, Sub-Advisor, the Dealer Manager, or their respective affiliates on behalf of the Company and subsequently reimbursed by the Company. For the Private Offering, offering expenses were deferred and a payable was recognized to the Advisor or Sub-Advisor until shares were sold in the Private Offering, at which point the expense reimbursement was paid from additional paid-in capital. For the Public Offerings, offering costs are offset against additional paid-in capital when incurred. These expenses include but are not limited to: (i) reimbursing the Dealer Manager and participating broker-dealers for bona fide out-of-pocket, itemized and detailed due diligence expenses incurred by these entities, (ii) expenses for printing and mailing, charges of transfer agents, registrars, trustees, escrow holders, depositaries and experts, and (iii) expenses of qualifying the sale of the shares under federal and state laws, including taxes and fees and accountants’ and attorneys’ fees and expenses. The Company reimbursed the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the Private Offering not in excess of the organization and offering expenses paid by investors in connection with the sale of Class P Shares in the Private Offering. The Company also reimburses the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the IPO, provided the Advisor has agreed to reimburse the Company to the extent that the organization and offering expenses that the Company incurs exceeds 15 % of its gross proceeds from the Public Offerings. Repurchase Agreements The Company enters into master repurchase agreements that allow the Company to sell real estate loans and securities while providing a fixed repurchase price for the same real estate loans and securities in the future. Repurchase agreements are being accounted for as secured borrowings since the Company maintains effective control of the financed assets. Under the master repurchase agreements, the respective lender retains the right to mark the underlying collateral to fair value. Senior Loan Participations For several first mortgage loans, the Company sold a non-recourse senior loan participation interest to a third party and retained a subordinate participation interest. These do not qualify as sales under GAAP and are instead presented in a manner similar to a secured borrowing. On the balance sheet, there is a gross presentation with the full loan receivable recorded in Commercial mortgage loans at cost and an offsetting liability to the third party recorded in Loan participations sold, net. Interest income on the mortgage loans continues to be recorded as described above with interest amounts due to the third party for its senior loan participation interest recorded in interest expense. Equity-Based Compensation In accordance with the Company’s Independent Director Restricted Share Plan (the “RSP”), restricted shares are issued to independent directors as compensation. The Company recognizes expense related to the fair value of equity-based compensation awards as operating expense in the consolidated statements of operations. The Company recognizes expense based on the fair value at the grant dated on a straight-line basis over the vesting period representing the requisite service period. See Note 12 – “Equity-Based Compensation” for further information. Income Taxes The Company qualifies as a REIT under the Internal Revenue Code of 1986, as amended, for federal income tax purposes commencing with the tax year ended December 31, 2017 and qualifies for taxation as a REIT. The Company generally will not be subject to federal income tax to the extent it distributes its REIT taxable income, subject to certain adjustments, to its stockholders. Subsequently, if the Company fails to qualify as a REIT in any taxable year, the Company will be subject to federal income tax on its taxable income at regular corporate tax rates. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income, property or net worth and federal income and excise taxes on its undistributed income. The Company had no uncertain tax positions as of December 31, 2022 or 2021 . The Company expects no significant increases or decreases in uncertain tax positions due to changes in tax positions within one year of December 31, 2022 . The Company had no interest or penalties relating to income taxes recognized in the consolidated statements of operations for the years ended December 31, 2022, 2021 or 2020. As of December 31, 2022, returns for the calendar years 2019, 2020, 2021 and 2022 remain subject to examination by U.S. and various state and local tax jurisdictions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. The Company operates the Renaissance O’Hare Suites Hotel (the “Renaissance O’Hare”) through a taxable REIT subsidiary (“TRS”) that has engaged a third-party hotel management company to manage the hotel under a management contract. The TRS generated operating losses of $ 2,345 and $ 1,661 in the years ended December 31, 2021 and 2020, respectively. Based on an effective tax rate of 28.51 %, which is calculated by combining a 21 % Federal tax rate and an IL tax rate of 7.51 % ( 9.5 % state rate net of the Federal benefit), the deferred tax benefit related to the operating loss is approximately $ 669 and $ 474 for the years ended December 31, 2021 and 2020, respectively. The projected estimated taxable income generated by the Renaissance O'Hare for the year ended December 31, 2022 is $ 608 , decreasing the deferred tax asset related to net operating losses to $ 994 . At December 31, 2022, it is more likely than not that the Company will not generate sufficient taxable income to fully realize the tax deferred tax asset related to the Company’s TRS, therefore the Company maintains a full valuation allowance on its deferred tax asset of $ 994 . If the operating results of the Renaissance O'Hare stabilize, management will reassess the need for this reserve. These losses do not expire. Distributions Payable Distributions payable represent distributions declared as of the balance sheet date which are payable to stockholders. Per Share Data The Company calculates basic and diluted earnings per share by dividing net income attributable to the Company for the period by the weighted-average number of shares of common stock outstanding for that period. Basic earnings (loss) per share (“EPS”) is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income by the common shares plus common share equivalents. For further information about the Company’s calculation of EPS, see Note 8 – “Net Income Per Share Attributable to Common Stockholders.” Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”), which changed how entities measure credit losses for financial assets carried at amortized cost. ASU 2016-13 eliminated the requirement that a credit loss must be probable before it can be recognized and instead required an entity to recognize the current estimate of all expected credit losses. ASU 2016-13 became effective for SEC filers for reporting periods beginning after December 15, 2019. In November 2019, the FASB issued ASU 2019-10, “Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates,” which grants smaller reporting companies (as defined by the SEC) until reporting periods commencing after December 15, 2022 to implement ASU 2016-13. As a smaller reporting company, the Company will adopt ASU 2016-13 through a cumulative-effect adjustment to accumulated deficit as of January 1, 2023. The Current Expected Credit Loss (“CECL”) reserve required under ASU 2016-13 is a valuation account that is deducted from the amortized cost basis of the related loans on the consolidated balance sheet, which will reduce the stockholders’ equity. The initial CECL reserve recorded on January 1, 2023 will be reflected as a direct charge against retained earnings; however, future net changes to the CECL reserve will be recognized in net income on the consolidated statement of operations. ASU 2016-13 does not require use of a particular method for determining the CECL reserve, but it does specify the allowance should be based on relevant information about past events, including historical loss experience, composition of the current loan portfolio, current conditions, and reasonable and supportable forecasts for the expected term of each loan. Additionally, but for a few narrow exceptions, ASU 2016-13 does not have a minimum threshold for recognition of impairment losses and requires that all financial instruments, including those for which there is a low risk of loss, incur some amount of valuation reserve to reflect the inherent risk of loss regardless of credit quality, amount of subordinate capital, or other risk mitigants. For the majority of the portfolio, the Company elected to utilize a widely-used analytical model, at the individual loan level, incorporating a probability of default and loss-given-default methodology and loan performance data for commercial real estate loans dating back to 1965. For one loan in the portfolio, the Company determined that an analytical model was not appropriate. In cases where the Company feels there is potential impairment, the CECL reserve is assessed by comparing the estimated fair value of the underlying collateral, less the cost to sell, to the book value of the respective loans. These valuations require significant judgment, which may include assumptions regarding capitalization rates, discount rates, leasing, creditworthiness of major tenants, occupancy rates, availability and cost of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed relevant by the Company. Actual losses, if any, could ultimately differ materially from these estimates. The Company only expects to realize the impairment losses if and when such amounts are deemed nonrecoverable upon a realization event. This is generally at the time a loan is repaid, or in the case of foreclosure, when the underlying asset is sold, but non-recoverability may also be concluded if, in our determination, it is nearly certain that all amounts due will not be collected. The loans may include commitments to fund incremental proceeds to the borrowers over the life of the loan, which are also subject to the CECL model. The CECL reserve related to future funding commitments will be recorded as a component of other liabilities on the consolidated balance sheet and be estimated using the same process as for the outstanding loan balances. Though the Company is still in the process of finalizing the effect of ASU 2016-13, the Company expects to record an additional allowance for credit losses in the range of $ 5,000 to $ 7,000 , which includes the amount attributable to future funding commitments, as of January 1, 2023 through a cumulative-effect adjustment to accumulated deficit. |
Commercial Mortgage Loans Held
Commercial Mortgage Loans Held for Investment | 12 Months Ended |
Dec. 31, 2022 | |
Mortgage Loans On Real Estate [Abstract] | |
Commercial Mortgage Loans Held for Investment | Note 3 – Commercial Mortgage Loans Held for Investment The following is a summary of the Company’s commercial mortgage loans held for investment as of December 31, 2022: Number of Principal Balance Unamortized Allowance for loan losses Carrying Value Weighted Average Weighted Average First mortgage loans 41 $ 831,007 $ 1,359 $ ( 3,588 ) $ 828,778 7.7 % 1.4 Credit loans 2 13,500 — — 13,500 9.6 % 3.4 Total and average 43 $ 844,507 $ 1,359 $ ( 3,588 ) $ 842,278 7.8 % 1.4 The following is a summary of the Company’s commercial mortgage loans held for investment as of December 31, 2021: Number of Principal Balance Unamortized Carrying Value Weighted Average Weighted Average First mortgage loans 36 $ 650,670 $ 1,328 $ 651,998 4.5 % 1.6 Credit loans 2 13,500 — 13,500 9.6 % 4.4 Total and average 38 $ 664,170 $ 1,328 $ 665,498 4.6 % 1.7 For the years ended December 31, 2022 and 2021, the activity in the Company’s commercial mortgage loans, held-for-investment portfolio was as follows: Year Ended December 31, 2022 Year Ended December 31, 2021 Balance at Beginning of Year $ 665,498 $ 441,814 Loan originations 300,576 337,033 Principal repayments ( 120,240 ) ( 114,558 ) Amortization of loan origination and deferred exit fees 616 1,440 Origination fees and extension fees received on commercial loans ( 584 ) ( 231 ) Provision for loan losses ( 3,588 ) — Balance at End of Period $ 842,278 $ 665,498 During May 2020, the Company sold one credit loan with an outstanding principal balance of $ 10,000 generating proceeds of $ 9,625 . The Company had not previously planned to sell the loan and had classified it as held for investment. The Company recognized a loss of $ 375 recorded in realized loss on sale of commercial loan. Allowance for Loan Losses The following table presents the activity in the Company's allowance for loan losses: Year Ended December 31, 2022 Year Ended December 31, 2021 Beginning of period $ — $ — Provision for loan losses ( 3,588 ) — Charge-offs — — Ending allowance for loan losses $ ( 3,588 ) $ — In accordance with the Company’s allowance for loan loss policy, during the year ended December 31, 2022 and 2020, the Company recorded impairment charges of $ 3,588 and $ 4,726 , respectively. The impairment charge in 2022 relates to a first mortgage loan secured by an office building. The impairment charge in 2020 relates to a first mortgage loan secured by a hotel property in Illinois. Both impairment charges were based on the estimated fair value of the underlying collateral. The loan on the hotel in Illinois was terminated in August 2020 in connection with the Company’s acquisition of the collateral via a deed-in-lieu of foreclosure. For the year ended December 31, 2020, interest income for the impaired loan was $ 465 . For further information on the Company’s allowance for loan losses policy, see “Note 2 – Summary of Significant Accounting Policies.” Credit Characteristics As part of the Company’s process for monitoring the credit quality of its investments, it performs a quarterly asset review of the investment portfolio and assigns risk ratings to each of its loans and CMBS. Risk factors include payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographic location, as well as national and regional economic factors. To determine the likelihood of loss, the loans are rated on a 5-point scale as follows: Investment Grade Investment Grade Definition 1 Investment exceeding fundamental performance expectations and/or capital gain expected. Trends and risk factors since time of investment are favorable. 2 Performing consistent with expectations and a full return of principal and interest expected. Trends and risk factors are neutral to favorable. 3 Performing investment requiring closer monitoring. Trends and risk factors show some deterioration. Collection of principal and interest is still expected. 4 Underperforming investment with the potential of some interest loss but still expecting a positive return on investment. Trends and risk factors are negative. 5 Underperforming investment with expected loss of interest and some principal. All investments are assigned an initial risk rating of 2 at origination. As of December 31, 2022 , 33 loans had a risk rating of 2 , eight had a risk rating of 3, one had a risk rating of 4 and one had a risk rating of 5. As of December 31, 2021, 33 loans had a risk rating of 2 and five had a risk rating of 3. |
Real Estate Securities
Real Estate Securities | 12 Months Ended |
Dec. 31, 2022 | |
Investments Debt And Equity Securities [Abstract] | |
Real Estate Securities | Note 4 – Real Estate Securities The Company classified its real estate securities as available-for-sale. These investments were reported at fair value in the consolidated balance sheets with changes in fair value recorded in other income or loss in the consolidated statements of operations. The Company did no t hold any real estate securities at December 31, 2022 or 2021 as all of the real estate securities were sold during the year ended December 31, 2020. During the year ended December 31, 2020, the Company sold all of its CMBS, generating proceeds of $ 121,189 and a realized loss of $ 35,020 . |
Repurchase Agreements and Credi
Repurchase Agreements and Credit Facilities | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure Of Repurchase Agreements [Abstract] | |
Repurchase Agreements and Credit Facilities | Note 5 – Repurchase Agreements and Credit Facilities On February 15, 2018, a wholly-owned subsidiary of the Company entered into a master repurchase agreement (the “CF Repo Facility”) with Column Financial, Inc. as administrative agent for certain of its affiliates. As the Company’s business has grown, it has increased the borrowing limit and extended the maturity. The most recent extension was in November 2022 for a twelve-month term and the maximum advance amount was set to $ 375,000 . Advances under the CF Repo Facility accrue interest at a per annum annual rate equal to the one-month term USD Secured Overnight Financing Rate (“SOFR”) plus 2.50 % to 3.00 % with a 0.15 % to 0.25 % floor. The CF Repo Facility is subject to certain financial covenants. The Company was in compliance with all financial covenant requirements as of December 31, 2022 and 2021. On May 6, 2019, the Company, through a wholly owned subsidiary, entered into an uncommitted master repurchase agreement (the “JPM Repo Facility”) with JPMorgan Chase Bank, National Association. The JPM Repo Facility provides up to $ 150,000 in advances that the Company expects to use to finance the acquisition or origination of eligible loans and participation interests therein. Advances made prior to December 2021 under the JPM Repo Facility accrue interest per annum rates equal to the sum of (i) the applicable one-month USD London Interbank Offered Rate (“LIBOR”) index rate plus (ii) a margin of between 1.75 % to 2.50 % with no floor, depending on the attributes of the purchased assets. Advances made subsequent to December 2021 under the JPM Repo Facility accrue interest at per annum rates equal to the sum of SOFR plus an agreed upon margin. As of December 31, 2022, 48.8 % of the advances made under the JPM Repo Facility were indexed to SOFR and have margins between 1.85 % to 2.85 % with a floor between 0.00 % to 2.00 %. In May 2022, the maturity date of the JPM Repo Facility is May 6, 2023 . The JPM Repo Facility is subject to certain financial covenants. One of the covenants requires that the ratio of earnings before interest, taxes, depreciation, and amortization (“EBITDA”) to Fixed Charges, defined as preferred dividends plus interest expense per the JPM Repo Facility agreement, should not fall below 150 % on a trailing four quarter basis. As of September 30, 2022 and as of December 31, 2022, the EBITDA to Fixed Charges ratio for the trailing four quarters was 144 % and 135 %, respectively. JPM agreed to waive this covenant as of September 30, 2022 and as of December 31, 2022. As a result, the Company was in compliance with all financial covenant requirements as of December 31, 2022 and 2021. On March 10, 2021, the Company, through a wholly owned subsidiary, entered into a loan and security agreement and a promissory note (collectively, the “WA Credit Facility”) with Western Alliance Bank (“Western Alliance”). The WA Credit Facility provides for loan advances up to the lesser of $ 75,000 or the borrowing base. The borrowing base consists of eligible assets pledged to and accepted by Western Alliance in its discretion up to the lower of (i) 60 % to 70 % of loan-to-unpaid balance or (ii) 45 % to 50 % of the loan-to-appraised value (depending on the property type underlying the asset, for both (i) and (ii)). Assets that would otherwise be eligible become ineligible after being pledged as part of the borrowing base for 36 months. Advances under the WA Credit Facility accrue interest at an annual rate equal to one-month LIBOR plus 3.25 % with a floor of 0.75 %. The initial maturity date of the WA Credit Facility was March 10, 2023 . On March 9, 2023, the Company extended the maturity date of the WA Credit Facility to March 10, 2025 , modified that loan advances are up to the lesser of $ 40,000 or the borrowing base, and changed the index rate from LIBOR to SOFR. In addition, the spread increased to 3.50 % and the floor to 6.00 %. The Company has an option to convert the loan made pursuant to the WA Credit Facility upon its initial maturity to a term loan with the same interest rate and floor and a maturity of two years in exchange for, among other things, a conversion fee of 0.25 % of the outstanding amount at the time of conversion. The WA Credit Facility requires maintenance of an average unrestricted aggregate deposit account balance with Western Alliance of not less than $ 3,750 . Failure to meet the minimum deposit balance will result in, among other things, the interest rate of the WA Credit Facility increasing by 0.25 % per annum for each quarter in which the compensating balances are not maintained. The Company was in compliance with all financial covenant requirements as of December 31, 2022. The JPM Repo Facility, CF Repo Facility and WA Credit Facility (collectively, the “Facilities”) are used to finance eligible loans and each act in the manner of a revolving credit facility that can be repaid as the Company’s assets are paid off and re-drawn as advances against new assets. The details of the Facilities as of December 31, 2022 and 2021 are as follows: December 31, 2022 Weighted Average Committed Amount Accrued Collateral Interest Days to CF Repo Facility $ 375,000 $ 356,094 $ 882 $ 494,962 6.89 % 679 JPM Repo Facility 150,000 131,992 305 181,972 6.40 % 492 Repurchase agreements - commercial mortgage loans 525,000 488,086 1,187 676,934 6.76 % 628 WA Credit Facility 75,000 18,380 16 29,797 7.64 % 435 $ 600,000 $ 506,466 $ 1,203 $ 706,731 6.79 % 621 December 31, 2021 Weighted Average Committed Amount Accrued Collateral Interest Days to CF Repo Facility $ 350,000 $ 189,654 $ 159 $ 260,691 2.16 % 314 JPM Repo Facility 150,000 117,470 92 167,704 2.02 % 126 Repurchase agreements - commercial mortgage loans 500,000 307,124 251 428,395 2.11 % 242 WA Credit Facility 75,000 14,350 22 20,500 4.00 % 434 $ 575,000 $ 321,474 $ 273 $ 448,895 2.19 % 251 ____________ (1) Excluding $ 3 and $ 41 of unamortized debt issuance costs as of December 31, 2022 and 2021, respectively. |
Loan Participations Sold, Net
Loan Participations Sold, Net | 12 Months Ended |
Dec. 31, 2022 | |
Mortgage Loans On Real Estate [Abstract] | |
Loan Participations Sold, Net | Note 6 – Loan Participations Sold, Net On November 15, 2021, the Company sold a non-recourse senior participation interest in nine first mortgage loans to a third party. Under the loan participation agreement, in the event of default by the underlying mortgagor, any amounts paid are first allocated to the third party before any amounts are allocated to the Company’s subordinate interest. The Company, as the directing participant in the loan participation agreement, is entitled to exercise, without the consent of the third party, each of the consent approval and control rights under the applicable underlying mortgage loan documents with a few exceptions. The Company requires the third party’s approval for any modification or amendment to the loan, a bankruptcy plan for an underlying mortgagor where the third party would incur an out-of-pocket loss, or any transfer of the underlying mortgaged property if the Company’s approval is required by the underlying mortgage documents. The Company remains the directing participant unless certain conditions are met related to losses on the property or if the mortgagor is an affiliate of the Company. In the former case, the Company may post cash or short-term U.S. government securities as collateral to retain the rights of the directing participant. The third party, as the senior participation interest holder, will receive interest and principal payments from the borrower until they receive the amounts to which they are entitled. All expenses or losses on the underlying mortgages are allocated first to the Company and then to the third party. If the underlying mortgage is in default, the Company will have the option to purchase the third party’s participation interest and remove it from the loan participation agreement. The financing or transfer of a portion of a loan by the non-recourse sale of a senior interest in the loan through a participation agreement generally does not qualify as a sale under GAAP. Therefore, in this instance, the Company presents the whole loan as an asset and the loan participation sold as a liability on the consolidated balance sheet until the loan is repaid. The obligation to pay principal and interest on these liabilities is generally based on the performance of the related loan obligation. The gross presentation of loan participations sold does not impact stockholders’ equity or net income. The following tables detail the Company’s loan participations sold as of December 31, 2022 and 2021: December 31, 2022 Loan Participations Sold Count Principal Balance Book Value Yield/Cost (1) Guarantee (2) Weighted Average Maximum Maturity Total Loans 7 $ 124,275 $ 121,431 L+ 3.7 % n/a 1.22 Senior participations (3) 7 $ 99,420 $ 99,420 L+ 2.0 % n/a 1.22 December 31, 2021 Loan Participations Sold Count Principal Balance Book Value Yield/Cost (1) Guarantee (2) Weighted Average Maximum Maturity Total Loans 9 $ 137,215 $ 137,931 L+ 3.6 % n/a 2.22 Senior participations (3) 9 $ 109,772 $ 109,772 L+ 2.0 % n/a 2.22 ____________ (1) The yield/cost is the present value of all future principal and interest payments on the loan or participation interest and does not include any origination fees or deferred commitment fees. (2) As of December 31, 2022 and 2021, the loan participations sold were non-recourse to the Company. (3) During the years ended December 31, 2022 and 2021, the Company recorded $ 3,952 and $ 281 of interest expense related to loan participations sold. |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Stockholders' Equity | Note 7 – Stockholders’ Equity Preferred Stock Offering On September 22, 2021, the Company issued and sold 3,500,000 shares of the Series A Preferred Stock at a public offering price of $ 25.00 per share. The Company also granted the underwriters a 30 -day option to purchase an additional 525,000 shares to cover over-allotments. In addition, on October 15, 2021, Raymond James & Associates, Inc., as representative of the underwriters, partially exercised their over-allotment option to purchase an additional 100,000 shares of Series A Preferred Stock. The Series A Preferred Stock were issued and sold pursuant to an effective registration statement on Form S-11 (File No. 333-258802) filed with the SEC. The Company received net proceeds of approximately $ 86,310 , after underwriter’s discount and issuance costs and contributed the net proceeds to the Operating Partnership in exchange for an equivalent number of Series A units in the Operating Partnership. Dividends on the Series A Preferred Stock are cumulative and payable quarterly in arrears at a rate per annum equal to 6.75 % per annum of the $ 25.00 liquidation preference (the “Initial Rate”). Subject to certain exceptions, upon a Change of Control that occurs on or prior to September 22, 2022 or upon a Downgrade Event (as such terms are defined in the Articles Supplementary designating the Series A Preferred Stock (the “Articles Supplementary”)) or where any shares of the Series A Preferred Stock remain outstanding after September 22, 2026, the Series A Preferred Stock will thereafter accrue cumulative cash dividends at a rate higher than the Initial Rate. Subject to certain exceptions, beginning on September 22, 2022, upon the occurrence of a Change of Control, each holder of shares of Series A Preferred Stock will have the right to convert some or all of the Series A Preferred Stock held by such holder into a number of the Company’s shares of Class I common stock as provided for in the Articles Supplementary. The Company may not redeem the Series A Preferred Stock prior to September 22, 2026 , except in limited circumstances relating to maintaining the Company’s qualification as a REIT and in connection with a Change of Control. On and after September 22, 2026, the Company may, at its option, redeem the Series A Preferred Stock, in whole or from time-to-time in part, at a price of $ 25.00 per shares of Series A Preferred Stock plus an amount equal to accrued and unpaid dividends (whether or not declared), if any. The Series A Preferred Stock has no maturity date and will remain outstanding indefinitely unless redeemed by the Company or converted by the holder pursuant to its terms (as set forth in the Articles Supplementary). On August 11, 2022, the Board authorized and approved a share repurchase program (the “Series A Preferred Repurchase Program”) pursuant to which the Company may repurchase up to the lesser of 1,000,000 shares or $ 15,000 of the outstanding shares of the Company’s Series A Preferred Stock through December 31, 2022. On November 10, 2022, the Board approved an extension of the Series A Preferred Repurchase Program through December 31, 2023. Under the Series A Preferred Repurchase Program, repurchases of shares of the Company’s Series A Preferred Stock may be made at management’s discretion from time to time through open market purchases, privately-negotiated transactions, block purchases or otherwise in accordance with applicable federal securities laws. The Company cannot predict when or it if will repurchase any shares of Series A Preferred Stock. The Series A Preferred Repurchase Program may be suspended, extended or terminated by the Company at any time without prior notice. During the year ended December 31, 2022, the Company repurchased and retired 51,304 shares of Series A Preferred Stock resulting in a gain of $ 306 from these repurchases. As of December 31,2022, the Company had authority to purchase 948,696 additional shares or $ 14,076 of Series A Preferred Stock under the Series A Preferred Repurchase Program. On January 30, 2023, the Board unanimously approved the termination of the Series A Preferred Repurchase Program. The Series A Preferred Stock is listed on the New York Stock Exchange under the symbol ICR PR A. Share Activity for Common Stock and Preferred Stock The following tables detail the change in the Company’s outstanding shares of all class of common and preferred stock, including restricted common stock: Preferred Stock Common Stock Year ended December 31, 2022 Series A Class P Class A Class T Class S Class D Class I Beginning balance 3,600,000 9,492,939 659,270 388,099 — 47,298 380,218 Issuance of shares — — 107,721 46,977 — — 67,316 Repurchase and retirement of preferred stock ( 51,304 ) — — — — — — Distribution reinvestment — — 12,662 6,307 — 1,548 16,212 Issuance of restricted shares — — — — — — 1,534 Redemptions — ( 930,162 ) ( 36,470 ) ( 155,042 ) — ( 958 ) ( 12,613 ) Ending balance 3,548,696 8,562,777 743,183 286,341 — 47,888 452,667 Preferred Stock Common Stock Year ended December 31, 2021 Series A Class P Class A Class T Class S Class D Class I Beginning balance — 10,151,787 655,835 398,233 — 50,393 381,955 Issuance of shares 3,600,000 — 4,801 3,673 — — 976 Distribution reinvestment — — 10,992 5,687 — 1,748 10,420 Issuance of restricted shares — — — — — — 1,477 Redemptions — ( 658,848 ) ( 12,358 ) ( 19,494 ) — ( 4,843 ) ( 14,610 ) Ending balance 3,600,000 9,492,939 659,270 388,099 — 47,298 380,218 Common Stock Year ended December 31, 2020 Class P Class A Class T Class S Class D Class I Beginning balance 10,182,305 272,006 121,718 — 41,538 100,743 Issuance of shares — 379,250 274,570 — 8,066 276,618 Distribution reinvestment — 4,579 1,945 — 789 3,201 Issuance of restricted shares — — — — — 1,393 Redemptions ( 30,518 ) — — — — — Ending balance 10,151,787 655,835 398,233 — 50,393 381,955 During the year ended December 31, 2022, the Company issued shares in the Public Offerings at an average price per share of $ 20.31 with total net proceeds, including proceeds from the DRP, of $ 3,722 after offering costs of $ 1,532 . During the year ended December 31, 2021, the Company issued shares in the IPO at an average price per share of $ 20.42 with total net proceeds, including proceeds from the DRP, of $( 110 ) after offering costs of $ 892 . In addition, the Company incurred $ 26 in reimbursable deferred offering costs that were payable to the Advisor and Sub-Advisor. The Company also issued shares of Series A Preferred Stock at an average price per share of $ 25.00 with total net proceeds of $ 86,307 after offering costs of $ 3,693 . During the year ended December 31, 2020, the Company issued shares in the IPO at an average price per share of $ 25.83 with total net proceeds, including proceeds from the DRP, of $ 22,267 after offering costs of $ 2,246 . In addition, the Company incurred $ 70 in reimbursable deferred offering costs that were payable to the Advisor and Sub-Advisor. Distributions Common Stock For the years ended December 31, 2018, 2017 and from January 1, 2019 to July 31, 2019, the Company paid distributions on Class P Shares based on daily record dates, payable in arrears the following month, equal to a daily amount of 1/365 th of $ 1.92 per share. Distributions declared on or after August 1, 2019 through February 29, 2020 on Class P Shares are based on monthly record dates, payable in arrears the following month equal to a monthly amount of 1/12 th of $ 1.92 per share. Distributions on Class A, Class T, Class D and Class I shares are based on monthly record dates, payable in arrears the following month equal to a monthly amount of 1/12 th of $ 1.62 per share from August 1, 2019 through February 29, 2020. On March 24, 2020, as a result of the COVID-19 pandemic, the Board suspended, among other things, the payment of distributions to the Company’s stockholders and the operation of the DRP, effective as of April 6, 2020. In making these decisions, the Board considered the difficulty of confidently determining an NAV as a result of the uncertainty surrounding the extent of the economic effects of the pandemic, as well as the financing challenges related to additional collateral required by the banks that regularly finance the Company’s assets. The Board believed that the responsible course of action in the face of the economic slowdown and uncertainty was to conserve liquidity and prioritize the payment of operating and other essential expenses until the extent of the economic effects of the pandemic could be better understood and analyzed. After considering, among other things, the reduced volatility in the market for the Company’s investments and some improvement in the U.S. economic outlook, on July 30, 2020, the Board authorized a distribution on the Company’s common stock that was paid to stockholders of record as of July 31, 2020 . The table below presents the aggregate annualized and monthly distributions declared on common stock by record date for all classes of shares since the Company resumed paying distributions. Record date Aggregate annualized gross distribution declared per share of common stock Aggregate monthly gross distribution declared per share of common stock July 31, 2020 $ 0.8576 $ 0.0715 August 31, 2020 $ 0.8800 $ 0.0733 September 30, 2020 $ 0.9000 $ 0.0750 October 31, 2020 $ 0.9000 $ 0.0750 November 30, 2020 $ 0.9000 $ 0.0750 December 31, 2020 $ 0.9000 $ 0.0750 January 31, 2021 $ 0.9500 $ 0.0792 February 28, 2021 $ 1.0000 $ 0.0833 March 31, 2021 $ 1.0500 $ 0.0875 April 30, 2021 $ 1.1000 $ 0.0917 May 31, 2021 $ 1.1500 $ 0.0958 June 30, 2021 $ 1.2500 $ 0.1042 July 31, 2021 $ 1.2500 $ 0.1042 August 31, 2021 $ 1.2500 $ 0.1042 September 30, 2021 $ 1.2500 $ 0.1042 October 31, 2021 $ 1.2500 $ 0.1042 November 30, 2021 $ 1.2500 $ 0.1042 December 31, 2021 $ 1.2500 $ 0.1042 January 31, 2022 $ 1.2500 $ 0.1042 February 28, 2022 $ 1.2500 $ 0.1042 March 31, 2022 $ 1.2500 $ 0.1042 April 30, 2022 $ 1.2500 $ 0.1042 May 31, 2022 $ 1.2500 $ 0.1042 June 30, 2022 $ 1.2500 $ 0.1042 July 31, 2022 $ 1.2500 $ 0.1042 August 31, 2022 $ 1.2500 $ 0.1042 September 30, 2022 $ 1.2500 $ 0.1042 October 31, 2022 $ 1.2500 $ 0.1042 November 30, 2022 $ 1.2500 $ 0.1042 December 31, 2022 $ 1.2500 $ 0.1042 The gross distribution was reduced each month for Class D and Class T of the Company’s common stock for applicable class-specific stockholder servicing fees to arrive at a lower net distribution amount paid to those classes. For a description of the stockholder servicing fees applicable to Class D, Class S and Class T shares of the Company’s common stock, please see “Note 11 – Transactions with Related Parties” below. During the years ended December 31, 2022, 2021 and 2020, the Company did no t have shares outstanding of Class S common stock. The following table shows the monthly net distribution per share for shares of Class D and Class T common stock since the Company resumed paying distributions. Record date Monthly net distribution declared per share of Class D common stock Monthly net distribution declared per share of Class T common stock July 31, 2020 $ 0.0670 $ 0.0560 August 31, 2020 $ 0.0688 $ 0.0578 September 30, 2020 $ 0.0706 $ 0.0600 October 31, 2020 $ 0.0704 $ 0.0594 November 30, 2020 $ 0.0706 $ 0.0600 December 31, 2020 $ 0.0704 $ 0.0595 January 31, 2021 $ 0.0749 $ 0.0646 February 28, 2021 $ 0.0794 $ 0.0701 March 31, 2021 $ 0.0832 $ 0.0729 April 30, 2021 $ 0.0876 $ 0.0776 May 31, 2021 $ 0.0915 $ 0.0813 June 30, 2021 $ 0.1000 $ 0.0900 July 31, 2021 $ 0.0999 $ 0.0896 August 31, 2021 $ 0.0999 $ 0.0895 September 30, 2021 $ 0.1000 $ 0.0900 October 31, 2021 $ 0.0999 $ 0.0895 November 30, 2021 $ 0.1000 $ 0.0901 December 31, 2021 $ 0.0999 $ 0.0897 January 31, 2022 $ 0.0999 $ 0.0896 February 28, 2022 $ 0.1003 $ 0.0910 March 31, 2022 $ 0.0999 $ 0.0898 April 30, 2022 $ 0.1001 $ 0.0903 May 31, 2022 $ 0.1000 $ 0.0899 June 30, 2022 $ 0.1001 $ 0.0904 July 31, 2022 $ 0.1000 $ 0.0899 August 31, 2022 $ 0.1000 $ 0.0900 September 30, 2022 $ 0.1001 $ 0.0905 October 31, 2022 $ 0.1000 $ 0.0900 November 30, 2022 $ 0.1002 $ 0.0905 December 31, 2022 $ 0.1000 $ 0.0900 Total distributions declared for Class P, Class A, Class T, Class D and Class I shares for the year ended December 31, 2022 were $ 11,245 , $ 869 , $ 416 , $ 57 and $ 495 , respectively. Total distributions declared for Class P, Class A, Class T, Class D and Class I shares for the year ended December 31, 2021 were $ 11,577 , $ 767 , $ 395 , $ 54 and $ 448 , respectively. Total distributions declared for Class P, Class A, Class T, Class D and Class I shares for the year ended December 31, 2020 were $ 7,768 , $ 419 , $ 213 , $ 33 and $ 229 , respectively. Series A Preferred Stock Series A Preferred Stock dividends are paid quarterly in arrears based on an annualized distribution rate of 6.75 % of the $ 25.00 per share liquidation preference, or $ 1.6875 per share per annum. During December 2021, the Board declared a quarterly dividend on the Series A Preferred Stock in the amount of $ 0.459375 per share which was paid on December 30, 2021 to holders of record on December 15, 2021 for the period beginning September 22, 2021 to, but not including, December 30, 2021. During March 2022, the Board declared a quarterly dividend on the Series A Preferred Stock in the amount of $ 0.421875 per share, which was paid on March 30, 2022 to holders of record on March 15, 2022. During June 2022, the Board declared a quarterly dividend on the Series A Preferred Stock in the amount of $ 0.421875 per share, which was paid on June 30, 2022 to holders of record on June 15, 2022. During August 2022, the Board declared a quarterly dividend on the Series A Preferred Stock in the amount of $ 0.421875 per share, which was paid on September 30, 2022 to holders of record on September 15, 2022. During December 2022, the Board declared a quarterly dividend on the Series A Preferred Stock in the amount of $ 0.421875 per share, which was paid on December 30, 2022 to holders of record on December 15, 2022. The table below presents the aggregate distributions declared per share for each applicable class of common stock and preferred stock during the years ended December 31, 2022, 2021 and 2020. The tables exclude from dividend declaration any month when there were no outstanding shares for a class of stock. Year ended December 31, 2022 Preferred Stock Common Stock Series A Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 1.6875 $ 1.2504 $ 1.2504 $ 1.2504 $ — $ 1.2504 $ 1.2504 Stockholder servicing fee per share N/A N/A N/A 0.1685 — 0.0498 N/A Net distributions declared per share $ 1.6875 $ 1.2504 $ 1.2504 $ 1.0819 $ — $ 1.2006 $ 1.2504 Year ended December 31, 2021 Preferred Stock (1) Common Stock Series A Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.4594 $ 1.1669 $ 1.1669 $ 1.1669 $ — $ 1.1669 $ 1.1669 Stockholder servicing fee per share N/A N/A N/A 0.1720 — 0.0507 N/A Net distributions declared per share $ 0.4594 $ 1.1669 $ 1.1669 $ 0.9949 $ — $ 1.1162 $ 1.1669 Year ended December 31, 2020 Common Stock Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.7648 $ 0.7148 $ 0.7148 $ — $ 0.7148 $ 0.7148 Stockholder servicing fee per share N/A N/A $ 0.1270 — 0.0373 N/A Net distributions declared per share $ 0.7648 $ 0.7148 $ 0.5878 $ — $ 0.6775 $ 0.7148 (1) Distributions on preferred stock are only for a partial year following their issuance on September 22, 2021. As of December 31, 2022 and 2021, distributions declared but not yet paid amounted to $ 1,047 and $ 1,137 , respectively. Distribution Reinvestment Plan The Company adopted a DRP, effective May 3, 2019, whereby Class A, Class T, Class S, Class D and Class I stockholders have the option to have their cash distributions reinvested in additional shares of common stock. Any cash distributions attributable to the class or classes of shares owned by participants in the DRP will be immediately reinvested in shares on behalf of the participants on the business day such distribution would have been paid to such stockholder. The per share purchase price for shares purchased pursuant to the DRP will be equal to the most recently published transaction price at the time the distribution is payable. Stockholders will not pay upfront selling commissions when purchasing shares pursuant to the DRP. The stockholder servicing fees with respect to Class T shares, Class S shares and Class D shares are calculated based on the NAV for those shares and may reduce the NAV or, alternatively, the distributions payable with respect to shares of each such class, including shares issued in respect of distributions on such shares under the DRP. Shares acquired under the DRP will entitle the participant to the same rights and be treated in the same manner as shares of that class purchased in the Public Offerings. The Company reserves the right to amend any aspect of its DRP without the consent of its stockholders, provided that notice of any material amendment is sent to participants at least ten business days prior to the effective date of that amendment. In addition, the Company may suspend or terminate the DRP for any reason at any time upon ten business days’ prior written notice to participants. A stockholder’s participation in the plan will be terminated to the extent that a reinvestment of such stockholder’s distributions in the Company’s shares would cause the percentage ownership or other limitations contained in the Company’s charter to be violated. Participants may terminate their participation in the DRP with five business days’ prior written notice to the Company. On March 24, 2020, the Board suspended the IPO, effective immediately, and the DRP, effective April 6, 2020. In determining to suspend the IPO and the DRP, the Board considered various factors, including the economic impact of the COVID-19 pandemic, the inability to accurately calculate the Company’s NAV per share due to uncertainty, volatility and lack of liquidity in the market, the Company’s need for liquidity due to financing challenges related to additional collateral required by the banks that regularly finance the Company’s assets and these uncertain and rapidly changing economic conditions. After determining that there had been reduced volatility in the market for the Company’s investments and some improvement in the U.S. economic outlook, the Advisor resumed calculation of the NAV beginning as of June 30, 2020 , and on October 1, 2020, the SEC declared effective the post-effective amendment to the Company’s registration statement on Form S-11 thereby permitting the Company to resume offers and sales of shares of common stock in the IPO, including through the DRP. On January 30, 2023, the Board suspended, among other things, the operation of the DRP, effective as of February 10, 2023. During the year ended December 31, 2022, the Company received proceeds from the DRP totaling $ 724 at an average price per share of $ 19.73 . During the year ended December 31, 2021, the Company received proceeds from the DRP totaling $ 583 at an average price per share of $ 20.22 . Share Repurchase Plan The Company adopted a SRP, effective May 3, 2019, whereby on a monthly basis, stockholders who have held their shares of common stock for at least one year may request that the Company repurchase all or any portion of their shares. The Company may repurchase fewer shares than have been requested in any particular month to be repurchased under its SRP, or none at all, in its discretion at any time. In addition, the total amount of aggregate repurchases of shares will be limited to no more than 2 % of the aggregate NAV per month and no more than 5 % of the aggregate NAV per calendar quarter. The Board may modify, suspend or terminate the SRP if it deems such action to be in the Company’s best interest and the best interest of its stockholders. On March 24, 2020 the Board suspended the SRP. On March 1, 2021, the SRP was reinstated for the Company’s stockholders requesting repurchase of shares as a result of the death or qualified disability of the holder, and on July 1, 2021, the SRP was reinstated for all stockholders. In accordance with the terms of the SRP that allow the Company to repurchase fewer shares than the maximum amount permitted under the SRP, the Company repurchased fewer shares than the maximum amount permitted for the months of July, August and September 2021 as directed by the Board. Beginning on October 1, 2021, the total amount of aggregate repurchases of shares is limited as set forth in the SRP (no more than 2 % of the Company’s aggregate NAV per month as of the last day of the previous calendar month and no more than 5 % of the Company’s aggregate NAV per calendar quarter with NAV measured as of the last day of the previous calendar quarter). On January 30, 2023, the Board unanimously approved, effective immediately, the suspension of the operation of the SRP. During the year ended December 31, 2022, the Company repurchased $ 22,367 of common stock at an average price per share of $ 19.70 . During the year ended December 31, 2021, after reinstatement of the SRP, the Company repurchased $ 14,335 of common stock at an average price per share of $ 20.19 . During the year ended December 31, 2020, prior to the suspension of the SRP, the Company repurchased $ 763 of common stock at an average price per share of $ 25.00 . |
Net Income Per Share Attributab
Net Income Per Share Attributable to Common Stockholders | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Net Income Per Share Attributable to Common Stockholders | Note 8 – Net Income Per Share Attributable to Common Stockholders Basic earnings per share attributable to common stockholders (“EPS”) is computed by dividing net income attributable to common stockholders by the weighted average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income attributable to common stockholders by the common shares plus common share equivalents. The Company’s common share equivalents are unvested restricted shares. For the year ended December 31, 2022, 830 additional shares related to common share equivalents were included in the computation of diluted earnings per share because the effect of those common share equivalents was dilutive. For the year ended December 31, 2021, 947 additional shares related to restricted shares were included in the computation of diluted earnings per share because the effect of those common share equivalents was dilutive. For the year ended December 31, 2020, no additional shares related to restricted shares were included in the computation of diluted earnings per share due to the net loss for the year. The Company excludes antidilutive restricted shares from the calculation of weighted-average shares for diluted earnings per share. There were 645 , 610 and 583 antidilutive restricted shares for the years ended December 31, 2022, 2021 and 2020, respectively. For further information about the Company’s restricted shares, see Note 12 – “Equity Based Compensation.” The following table is a summary of the basic and diluted net (loss) income per share attributable to common stockholders computation for the years ended December 31, 2022, 2021 and 2020: Year Ended December 31, 2022 Year Ended December 31, 2021 Year Ended December 31, 2020 Net income (loss) attributable to common stockholders $ 4,430 $ 8,219 $ ( 28,784 ) Weighted average shares outstanding, basic 10,605,242 11,480,517 11,561,828 Weighted average shares outstanding, diluted 10,606,072 11,481,464 11,561,828 Net income (loss) per share attributable to common stockholders, basic and diluted $ 0.42 $ 0.72 $ ( 2.49 ) |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2022 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 9 – Commitments and Contingencies In the ordinary course of business, the Company may become subject to litigation, claims and regulatory matters. The Company has no knowledge of material legal or regulatory proceedings pending or known to be contemplated against the Company at this time. The Company has made a commitment to advance additional funds under certain of its real estate loans if the borrower meets certain conditions. As of both December 31, 2022 and 2021, the Company had 33 commercial mortgage loans with a total remaining future funding commitment of $ 59,474 and $ 74,518 , respectively. The Company could advance future funds at its discretion if requested by the borrower and the borrower meets certain requirements as specified in individual loan agreements. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Dec. 31, 2022 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 10 – Segment Reporting The Company has one reportable segment as defined by GAAP for the years ended December 31, 2022, 2021 and 2020. |
Transactions with Related Parti
Transactions with Related Parties | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Transactions with Related Parties | Note 11 – Transactions with Related Parties As of December 31, 2022 and 2021, the Advisor had invested $ 1,000 in the Company through the purchase of 40,040 Class P Shares. The purchase price per Class P Share for the Advisor’s investment was the Transaction Price, with no payment of selling commissions, dealer manager fees or organization and offering expenses. The Advisor has agreed pursuant to its subscription agreement that, for so long as it or its affiliate is serving as the Advisor, (i) it will not sell or transfer at least 8,000 of the Class P Shares that it has purchased, accounting for $ 200 of its investment, to an unaffiliated third party; (ii) it will not be eligible to submit a request for these 40,040 Class P Shares pursuant to the Company’s SRP prior to the fifth anniversary of the date on which such shares were purchased (November 2021); and (iii) repurchase requests made for these Class P Shares will only be accepted (a) on the last business day of a calendar quarter, (b) after all repurchase requests from all other stockholders for such quarter have been accepted and (c) to the extent that such repurchases do not cause total repurchases in the quarter in which they are being repurchased to exceed that quarter’s repurchase cap . As of December 31, 2022 and 2021, Sound Point Capital Management, LP (“Sound Point”), an affiliate of the Sub-Advisor, had invested $ 3,000 in the Company through the purchase of 120,000 Class P Shares. The purchase price per Class P Share for this investment was the Transaction Price, with no payment of selling commissions, dealer manager fees or organization and offering expenses. Sound Point has agreed pursuant to its subscription agreement that, for so long as the Sub-Advisor or its affiliate is serving as the Sub-Advisor, (i) it will not be eligible to submit a request for the repurchase of these 120,000 shares pursuant to the Company’s SRP prior to the fifth anniversary of the date on which such shares were purchased (November 2021); and (ii) repurchase requests made for these shares will only be accepted (a) on the last business day of a calendar quarter, (b) after all repurchase requests from all other stockholders for such quarter have been accepted and (c) to the extent that such repurchases do not cause total repurchases in the quarter in which they are being repurchased to exceed that quarter’s repurchase cap. The following table summarizes the Company’s related party transactions for the years ended December 31, 2022, 2021 and 2020: Year Ended Year Ended Year Ended Payable as of December 31, 2022 December 31, 2021 December 31, 2020 2022 2021 Organization and offering expense reimbursement (1) $ — $ 26 $ 70 $ — $ — Selling commissions and dealer manager fee (2) 155 8 758 — — Advisory fee (3) 3,692 3,217 5,528 296 321 Loan fees (4) 3,714 4,597 1,508 1,419 1,983 Accrued stockholder servicing fee (5) ( 59 ) ( 23 ) 446 482 590 Operating expense reimbursement to Advisor (6) — 56 1 — — Total $ 7,502 $ 7,881 $ 8,311 $ 2,197 $ 2,894 ____________ (1) The Company reimburses the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the Public Offerings, provided the Advisor has agreed to reimburse the Company to the extent that the organization and offering expenses that the Company incurs exceeds 15 % of its gross proceeds from the IPO. (2) For the Public Offerings, the Dealer Manager is entitled to receive (a) upfront selling commissions of up to 6.0 %, and upfront dealer manager fees of up to 1.25 %, of the transaction price of each Class A share sold in the primary offering, however such amounts may vary at certain participating broker-dealers provided that the sum will not exceed 7.25 % of the transaction price; (b) upfront selling commissions of up to 3.0 %, and upfront dealer manager fees of 0.5 %, of the transaction price of each Class T share sold in the primary offering, however such amounts may vary at certain participating broker-dealers provided that the sum will not exceed 3.5 % of the transaction price; and (c) upfront selling commissions of up to 3.5 % of the transaction price of each Class S share sold in the primary offering. No upfront selling commissions or dealer manager fees are paid with respect to purchases of Class D shares, Class I shares or shares of any class sold pursuant to the Company’s DRP. All upfront selling commissions and dealer manager fees will be reallowed (paid) by the Dealer Manager to participating broker-dealers. (3) The Advisor is entitled to receive an advisory fee comprised of two separate components: (1) a fixed component payable monthly and (2) a performance component payable annually. Prior to July 1, 2021, the fixed component of the advisory fee was paid in an amount equal to 1/12th of 1.25 % per annum of the gross value of the Company’s assets, paid monthly in arrears, provided that any such monthly payment could not exceed 1/12 th of 2.5 % of the Company’s NAV. Effective July 1, 2021, the fixed component of the advisory fee is paid in an amount equal to 1/12 th of 1.25 % of the Company’s average NAV for each month, paid monthly in arrears. The performance component of the advisory fee is calculated and paid annually, such that for any year in which the Company’s total return per share exceeds 7 % per annum, the Advisor will receive 20 % of the excess total return allocable to shares of the Company’s common stock; provided that in no event will the performance fee exceed 15 % of the aggregate total return allocable to shares of the Company’s common stock for such year. In addition, if the NAV per share decreases below $25 for any class of shares during the measurement period, any subsequent increase in NAV per share to $ 25 (or such other adjusted number) will not be included in the calculation of the performance component with respect to that class. The Advisor waived $ 0 , $ 1,475 and $ 874 of the fixed component of the advisory fees for the years ended December 31, 2022, 2021 and 2020, respectively. For the year ended December 31, 2020, the Advisor did no t earn the performance component of the advisory fee. The Advisor pays fees to the Sub-Advisor for the services its delegates to the Sub-Advisor or may direct the Company to pay a portion of the fees otherwise payable to the Advisor directly to the Sub-Advisor. (4) The Company pays the Advisor all new loan origination and administrative fees related to CRE loans held for investment, to the extent that such fees are paid by the borrower. Pursuant to the Sub-Advisory Agreement, the Advisor generally will reallow a portion of loans fees and all administrative fees to the Sub-Advisor. (5) Subject to the Financial Industry Regulatory Authority, Inc. limitations on underwriting compensation, the Company pays the Dealer Manager selling commissions over time as stockholder servicing fees for ongoing services rendered to stockholders by participating broker-dealers or broker-dealers servicing stockholders’ accounts as follows: (a) for Class T shares only, 0.85 % per annum of the NAV of the Class T shares; (b) for Class S shares only, 0.85 % per annum of the aggregate NAV for the Class S shares; and (c) for Class D shares only, 0.25 % per annum of the aggregate NAV for the Class D shares. The Company will cease paying the stockholder servicing fee with respect to any Class T share, Class S share or Class D share held in a stockholder’s account upon the occurrence of certain events. The Company accrues the full cost of the stockholder servicing fee as an offering cost at the time the Company sells Class T, Class S, and Class D shares. The Dealer Manager does not retain any of these fees, all of which are retained by, or reallowed (paid) to, participating broker-dealers and servicing broker-dealers for ongoing stockholder services performed by such broker-dealers. (6) Prior to July 1, 2021, the Company reimbursed the Advisor for expenses that it (or the Sub-Advisor acting on the Advisor’s behalf) incurs in connection with providing services to the Company, provided that the Company did not reimburse overhead costs, including rent and utilities or personnel costs (including salaries, bonuses, benefits and severance payments) and the Company only reimbursed the Advisor for fees payable to its affiliates if they are incurred for legal or marketing services rendered on the Company’s behalf. Effective July 1, 2021, the Company is obligated to reimburse for all of the expenses attributable to the Company or its subsidiaries, including the Operating Partnership, and paid or incurred and submitted to the Company for reimbursement by the Advisor, the Sub-Advisor or their respective affiliates in providing services to the Company under the Advisory Agreement, including personnel and related employment costs. Expense Limitation Agreement Pursuant to an expense limitation agreement (the “Expense Limitation Agreement”) dated July 1, 2021, the Advisor and Sub-Advisor agree to waive reimbursement of or pay, on a quarterly basis, certain of the Company’s ordinary operating expenses for each class of shares to the extent necessary to ensure that the ordinary operating expenses do not exceed 1.5 % of the average monthly net assets on an annualized basis (the “ 1.5 % Expense Limit”). Amounts waived or paid by the Advisor or Sub-Advisor pursuant to the Expense Limitation Agreement are subject to conditional repayment on a quarterly basis by the Company during the three years following the quarter in which the expenses were incurred, but only to the extent such repayment does not cause the Company to exceed its then-current expenses limitation, if any, for such quarter. Any waiver or reimbursement by the Advisor or Sub-Advisor not repaid by the Company within the three-year period will be deemed permanently waived and not subject to repayment under the Expense Limitation Agreement. During the year ended December 31, 2022, the amount of ordinary operating expenses either submitted for reimbursement by the Advisor and Sub-Advisor or incurred by the Company directly that was subject to the Expense Limitation Agreement did not exceed the 1.5 % Expense Limit. Separately from the limitation on ordinary operating expenses under the Expense Limitation Agreement, the Advisor and Sub-Advisor voluntarily chose not to seek reimbursement for certain expenses that they incurred or paid on behalf of the Company during the year ended December 31, 2022, and for which they may have been entitled to be reimbursed. The Advisory Agreement and Sub-Advisory Agreement provide that expenses will be submitted monthly to the Company for reimbursement, and the amount of expenses submitted for reimbursement in any particular month is not necessarily indicative of the total amount of expenses actually incurred by the Advisor and Sub-Advisor in providing services to the Company and for which reimbursement could have been received by the Advisor and Sub-Advisor. Revolving Credit Liquidity Letter Agreements Inland Real Estate Investment Corporation (“IREIC”), the Company’s sponsor, and Sound Point have agreed under separate letter agreements dated July 20, 2021, and July 15, 2021, respectively, to make revolving credit loans to the Company in an aggregate principal amount outstanding at any one time not to exceed $ 5,000 and $ 15,000 , respectively (the “IREIC-Sound Point Commitments”) from time to time until the Termination Date (defined below) of the letter agreements. These letter agreements are identical to each other in all material respects other than the commitment amounts. Use of the IREIC-Sound Point Commitments is limited to satisfying requirements to maintain cash or cash equivalents under the Company’s repurchase and other borrowing arrangements. The “Termination Date” is the earliest of (i) the Maturity Dated (defined below) (ii) the first date on which the Company’s balance sheet equity is equal to or greater than $ 500,000 , (iii) the date IREIC or one of its affiliates is no longer the Company’s Advisor or Sound Point or one of its affiliates is no longer the Company’s Sub-Advisor and (iv) such earlier date on which the commitment will terminate as provided in the letter agreements, for example, because of an event of default. The “Maturity Date” is one year from the date of the agreement, and the Maturity Date will be automatically extended every year for an additional year, unless (a) the lender delivers notice of termination 60 days prior to an anniversary of the letter agreements or (b) and Event of Default (defined below) has occurred and is continuing. Each revolving loan will bear interest at 6.00 % per annum. Interest is payable in arrears when principal is paid or repaid and on the Termination Date. Each of the following constitutes an “Event of Default” under the letter agreements: (y) the Company fails to perform or observe any covenant or condition to be performed or observed under the letter agreement (including the obligation to repay a loan in full on the Termination Date) and such failure is not remedied within three business days of its receipt of notice thereof; or (z) the Company becomes insolvent or the subject of any bankruptcy proceeding. |
Equity-Based Compensation
Equity-Based Compensation | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Equity-Based Compensation | Note 12 – Equity-Based Compensation With each stock grant, the Company awards each of its three independent directors an equal number of shares. The table below summarizes total stock grants made at each grant date as of December 31, 2022. Grant Date Class of common stock granted Total number of shares granted Grant Date Fair Value Per Share Total Fair Value of Grant Proportion of total shares that vest annually Vesting Date Year 1 Vesting Date Year 2 Vesting Date Year 3 March 1, 2018 Class P 1,200 $ 25.00 $ 30 1/3 3/1/2019 3/1/2020 3/1/2021 January 7, 2019 Class P 1,200 $ 25.00 $ 30 1/3 1/7/2020 1/7/2021 1/7/2022 December 2, 2019 Class I 1,197 $ 25.07 $ 30 1/3 12/2/2020 12/2/2021 12/2/2022 December 1, 2020 Class I 1,393 $ 21.54 $ 30 1/3 12/1/2021 12/1/2022 12/1/2023 October 14, 2021 Class I 1,477 $ 20.31 $ 30 1/3 10/14/2022 10/14/2023 10/14/2024 October 3, 2022 Class I 1,534 $ 19.55 $ 30 1/3 10/3/2023 10/3/2024 10/3/2025 Under the RSP, restricted shares generally vest over a three-year vesting period from the date of the grant, subject to the specific terms of the grant. Restricted shares are included in common stock outstanding on the date of vesting. The grant-date value of the restricted shares is amortized over the vesting period representing the requisite service period. Compensation expense associated with the restricted shares issued to the independent directors was $ 32 , $ 34 and $ 31 for the years ended December 31, 2022, 2021 and 2020, respectively. As of December 31, 2022, the Company had $ 54 of unrecognized compensation expense related to the unvested restricted shares, in the aggregate. The weighted average remaining period that compensation expense related to unvested restricted shares will be recognized is 1.47 years. The total fair value at the vesting date for restricted shares that vested during the year ended December 31, 2022 was $ 35 . A summary table of the status of the restricted shares granted under the RSP is presented below: Restricted Shares Weighted Outstanding at December 31, 2021 3,205 $ 21.85 Granted 1,534 19.55 Vested ( 1,756 ) 22.79 Converted — — Forfeited — — Outstanding at December 31, 2022 2,983 $ 20.11 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 13 – Fair Value of Financial Instruments As discussed in Note 2, GAAP requires the disclosure of fair value information about financial instruments, whether or not recognized in the consolidated balance sheets, for which it is practicable to estimate that value. The following table details the carrying amount and fair value of the financial instruments described in Note 2: December 31, 2022 December 31, 2021 Carrying Estimated Carrying Estimated Financial assets Cash and cash equivalents $ 29,408 $ 29,408 $ 57,268 $ 57,268 Commercial mortgage loans, net 842,278 842,278 665,498 667,405 Total $ 871,686 $ 871,686 $ 722,766 $ 724,673 Financial liabilities Repurchase agreements - commercial mortgage loans $ 488,086 $ 488,086 $ 307,083 $ 307,083 Credit facility payable 18,380 18,380 14,350 14,350 Loan participations sold 99,420 99,420 109,772 109,772 Total $ 605,886 $ 605,886 $ 431,205 $ 431,205 The following describes the Company’s methods for estimating the fair value for financial instruments: • The estimated fair values of restricted cash, cash and cash equivalents were based on the bank balance and was a Level 1 fair value measurement. • The estimated fair value of commercial mortgage loans, net is a Level 3 fair value measurement. During the second quarter of 2022, the Company changed the method for calculating the fair value of the commercial mortgage loan portfolio. Since the loans have a short duration to maturity ( 1.4 years), are almost exclusively floating rate, are not delinquent and all except for one are not impaired and are expected to return par, the Advisor determined the amortized cost is the best estimate of fair value for all loans except for the one impaired loan. For the impaired loan, the estimated fair value also includes the reduction from the allowance for loan losses. See Note 16 – “Subsequent Events - Loan Loss Reserve” for a discussion of the impaired loan and the associated reserve. • The estimated fair value of repurchase agreements – commercial mortgage loans, credit facility payable and loan participations sold are Level 3 fair value measurements based on expected present value techniques. This method discounts future estimated cash flows using rates the Company determined best reflect current market interest rates that would be offered for repurchase agreements, credit facilities and loan participations sold with similar characteristics and credit quality. |
Real Estate Owned
Real Estate Owned | 12 Months Ended |
Dec. 31, 2022 | |
Real Estate [Abstract] | |
Real Estate Owned | Note 14 – Real Estate Owned The following table summarizes the Company’s REO assets as of December 31, 2022: Acquisition Date Property Type Primary Location(s) Building and Improvements Furniture, Fixtures and Equipment Accumulated Depreciation Real Estate Owned, Net August 2020 (1)(2) Hotel Chicago, IL $ 26,699 $ 7,137 $ ( 2,621 ) $ 31,215 (1) Refer to Note 2 – “Summary of Significant Accounting Policies” for useful life of the above assets. (2) Represents hotel ground lease interest acquired by the Company by completing a deed-in-lieu of foreclosure transaction. During February 2021, the Company received a loan under the Paycheck Protection Program (“PPP”) related to the operations of the Renaissance O’Hare. This five-year loan was for $ 1,093 with a fixed interest rate of 1.00 % that does not compound. The PPP was created as part of the Coronavirus Aid, Relief, and Economic Security Act (“CARES Act”). To be eligible to receive a loan, companies must make a number of certifications related to its operations, employees and size of the business on an application. Companies may also subsequently apply for loan forgiveness under the program provided that it meets requirements limiting any reduction in workforce or in pay. The Company was granted forgiveness by the U.S. Small Business Administration in December 2021. The Company accounted for this PPP loan using a government grant accounting approach. The grant proceeds were initially recorded in accrued expenses on the consolidated balance sheet. Each month, those proceeds were applied as a reduction to payroll-related costs within real estate owned operating expenses on the consolidated statement of operations until the proceeds have been fully absorbed by the payroll-related expenses. As of December 31, 2022, no balance remains recorded in accrued expenses for the PPP loan to be absorbed by payroll-related expenses. |
Leases
Leases | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Leases | Note 15 – Leases The Company is the lessee under one ground lease. The ground lease, which commenced on April 1, 1999 , was assumed as part of a property acquired through a deed-in-lieu of foreclosure transaction on August 20, 2020 and extends through March 31, 2098 . The lease is classified as a finance lease. Under the ground lease, the Company is prohibited from mortgaging the land but is not prohibited from making a leasehold mortgage for property constructed on the land. The Company may terminate the lease as of March 31, 2049, March 31, 2065 and March 31, 2081 provided that twelve months’ notice is provided to the lessor prior to those respective dates. Upon assumption of the lease, the Company recorded a lease liability of $ 16,827 and a ROU asset of $ 5,549 on its consolidated balance sheet. The lease liability was based on the present value of the ground lease’s future payments using an interest rate of 11.37 %, which the Company considers a reasonable estimate of the Company’s incremental borrowing rate. For the years ended December 31, 2022, 2021 and 2020, total finance lease cost was comprised as follows: Years ended December 31, 2022 2021 2020 Amortization of right-of-use assets $ 72 $ 71 $ 24 Interest on lease liabilities 1,963 1,925 634 Total finance lease cost $ 2,035 $ 1,996 $ 658 The table below shows the Company’s finance lease right of use asset, net of amortization as of December 31, 2022 and 2021: December 31, December 31, 2022 2021 Finance lease right of use asset, gross $ 5,549 $ 5,549 Accumulated amortization ( 167 ) ( 95 ) Finance lease right of use asset, net of amortization $ 5,382 $ 5,454 Lease payments for the ground lease as of December 31, 2022 for each of the five succeeding years and thereafter is as follows: Lease Payments 2023 $ 1,611 2024 1,745 2025 1,772 2026 1,772 2027 1,772 Thereafter 267,914 Total undiscounted lease payments $ 276,586 Less: Amount representing interest ( 259,129 ) Present value of lease liability $ 17,457 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 16 – Subsequent Events The Company has evaluated subsequent events through March 30, 2023, the date the consolidated financial statements were issued, and determined that there have not been any events that have occurred that would require adjustments to disclosures in the consolidated financial statements except for the following transactions: Suspension of Share Repurchase Plan, Primary Offering, and Distribution Reinvestment Plan In light of the pace of fundraising in the Second Public Offering and the amount of monthly redemption requests pursuant to the SRP, which are currently in excess of such fundraising, on January 30, 2023, the Board unanimously approved, effective immediately, the suspension of the operation of the SRP. In connection with such suspension, the Board has also unanimously approved the suspension of the sale of shares in the primary portion of the public offering (the “Primary Offering”), effective immediately, and the suspension of the sale of shares pursuant to the DRP, effective as of February 10, 2023. The Primary Offering, the SRP, and the DRP shall each remain suspended unless and until such time as the Board approves their resumption. In connection with the foregoing, the Board has decided to evaluate strategic alternatives available to the Company. Termination of Series A Preferred Repurchase Program The Board previously authorized and approved the Series A Preferred Repurchase Program pursuant to which the Company was permitted to repurchase up to the lesser of 1,000,000 shares or $ 15,000,000 of the outstanding shares of the Company’s 6.75 % Series A Cumulative Redeemable Preferred Stock through December 31, 2022 (later extended through December 31, 2023). On January 30, 2023, the Board unanimously approved the termination of the Series A Preferred Repurchase Program. Distributions On February 17, 2023 , the Company paid distributions for each class of its common stock to stockholders of record as of January 31, 2023 in the amounts per share set forth below: Common Stock Class P Class A Class T Class D Class I Aggregate gross distributions declared per share $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 Stockholder servicing fee per share N/A N/A 0.0142 0.0042 N/A Net distributions declared per share $ 0.1042 $ 0.1042 $ 0.0900 $ 0.1000 $ 0.1042 On February 27, 2023 , the Company announced that the Board authorized a distribution on its Series A Preferred Stock to stockholders of record as of March 15, 2023 , payable on or about March 30, 2023 in the amount of $ 0.421875 per share. On March 17, 2023 , the Company paid distributions for each class of its common stock to stockholders of record as of February 28, 2023 in the amounts per share set forth below: Common Stock Class P Class A Class T Class D Class I Aggregate gross distributions declared per share $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 Stockholder servicing fee per share N/A N/A 0.0128 0.0038 N/A Net distributions declared per share $ 0.1042 $ 0.1042 $ 0.0914 $ 0.1004 $ 0.1042 Loan Loss Reserve In March 2023, changes in local market conditions cast doubt on the collectability of one of the Company’s first mortgage loans. A large tenant in a competing office building decided to relocate their operations. Consequently, the increase in the supply of available office space is pushing down rents in the area which is having a detrimental impact on the value of the underlying collateral on the loan. As a result, the Company has recorded a loan loss reserve of $ 3,588 as of December 31, 2022. The loss reserve includes the total principal balance and accrued fees of $ 17,120 net of the participation interest of $ 13,532 . Repurchase Agreements and Credit Facilities On February 8, 2023, Column Financial, Inc. and affiliated parties sold and assigned their interest in the CF Loan Facility to Atlas Securitized Products Investments 2, L.P. All other terms of the loan facility were unchanged. |
Schedule IV - Mortgage Loans on
Schedule IV - Mortgage Loans on Real Estate | 12 Months Ended |
Dec. 31, 2022 | |
Mortgage Loans On Real Estate [Abstract] | |
Schedule IV - Mortgage Loans on Real Estate | Type of Loan (1) Principal Balance (2) Carrying Amount (2) Property Type Cash Coupon (2) Periodic Payment Terms (3) Maximum Maturity (4) First Mortgage Loan 1 $ 14,650 $ 14,892 Office L+4.70% I/O 1/9/23 First Mortgage Loan 2 16,915 13,411 Office L+4.50% I/O 7/9/23 First Mortgage Loan 3 24,411 24,477 Office L+3.75% I/O 9/9/23 First Mortgage Loan 4 16,150 16,210 Hospitality L+4.20% I/O 7/9/25 First Mortgage Loan 5 13,548 13,625 Multifamily L+3.25% I/O 6/9/24 First Mortgage Loan 6 47,747 47,938 Office L+2.75% I/O 7/9/24 First Mortgage Loan 7 6,631 6,642 Mixed Use L+3.60% I/O 7/9/24 First Mortgage Loan 8 6,712 6,702 Office L+4.20% I/O 9/9/24 First Mortgage Loan 9 15,786 15,821 Office L+3.10% I/O 10/9/24 First Mortgage Loan 10 22,616 22,678 Office L+2.90% I/O 10/9/24 First Mortgage Loan 11 25,506 25,649 Office L+3.30% I/O 2/9/25 First Mortgage Loan 12 11,016 11,072 Retail L+3.85% I/O 3/9/25 First Mortgage Loan 13 9,704 9,727 Retail L+3.50 I/O 3/9/25 First Mortgage Loan 14 13,647 13,756 Office L+5.00% I/O 3/9/26 First Mortgage Loan 15 20,135 20,167 Industrial L+4.00% I/O 3/9/26 First Mortgage Loan 16 14,063 14,112 Multifamily L+3.50% I/O 4/9/26 First Mortgage Loan 17 11,544 11,581 Multifamily L+3.50% I/O 4/9/26 First Mortgage Loan 18 9,090 9,090 Industrial L+4.00% I/O 5/9/26 First Mortgage Loan 19 28,119 28,119 Multifamily L+3.15% I/O 5/9/26 First Mortgage Loan 20 11,200 11,215 Multifamily L+3.20% I/O 6/9/26 First Mortgage Loan 21 15,689 15,710 Multifamily L+3.10% I/O 6/9/26 First Mortgage Loan 22 6,430 6,446 Mixed Use L+4.50% I/O 7/9/26 First Mortgage Loan 23 29,550 29,550 Multifamily L+3.20% I/O 10/9/26 First Mortgage Loan 24 22,655 22,655 Multifamily L+2.95% I/O 11/9/26 First Mortgage Loan 25 25,238 25,238 Multifamily L+2.90% I/O 11/9/26 First Mortgage Loan 26 23,823 23,823 Multifamily L+3.05% I/O 12/9/26 First Mortgage Loan 27 23,409 23,409 Multifamily L+2.85% I/O 12/9/26 First Mortgage Loan 28 39,401 39,401 Multifamily L+3.05% I/O 12/9/26 First Mortgage Loan 29 25,367 25,367 Multifamily L+3.20% I/O 1/9/27 First Mortgage Loan 30 37,365 37,365 Multifamily SOFR+3.40% I/O 1/9/27 First Mortgage Loan 31 16,153 16,153 Retail SOFR+3.65% I/O 2/9/27 First Mortgage Loan 32 14,473 14,474 Industrial SOFR+3.55% I/O 2/9/27 First Mortgage Loan 33 13,937 13,937 Multifamily SOFR+3.30% I/O 2/9/27 First Mortgage Loan 34 30,000 30,000 Mixed Use SOFR+3.04% I/O 3/9/27 First Mortgage Loan 35 26,591 26,612 Multifamily SOFR+3.40% I/O 3/9/27 First Mortgage Loan 36 16,668 16,668 Industrial SOFR+3.30% I/O 4/9/27 First Mortgage Loan 37 13,073 13,073 Multifamily SOFR+3.25% I/O 4/9/27 First Mortgage Loan 38 18,406 18,424 Multifamily SOFR+3.40% I/O 5/9/26 First Mortgage Loan 39 44,589 44,589 Multifamily SOFR+3.45% I/O 6/9/27 First Mortgage Loan 40 27,000 27,000 Multifamily SOFR+3.90% I/O 9/9/27 First Mortgage Loan 41 22,000 22,000 Multifamily SOFR+3.90% I/O 12/9/27 Credit Loan 1 7,500 7,500 Office 9.20 % I/O 10/11/27 Credit Loan 2 6,000 6,000 Office 10.00 % I/O 10/6/24 $ 844,507 $ 842,278 ____________ (1) First mortgage loans are first position mortgage loans and credit loans are mezzanine and subordinated loans. (2) Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans . (3) I/O = interest only, P/I = principal and interest. (4) Maximum maturity assumes all extension options are exercised. Reconciliation of Commercial Mortgage Loans, At Cost: The following table reconciles commercial mortgage loans, at cost for the years ended: 2022 2021 2020 Balance at January 1, $ 665,498 $ 441,814 $ 504,702 Additions during period: Loan fundings 300,576 337,033 69,135 Deferred interest capitalized on commercial loan — — 386 Amortization of deferred fees and expenses 616 1,440 1,818 Deductions during period: Collections of principal ( 120,240 ) ( 114,558 ) ( 99,727 ) Sale of commercial loan — — ( 10,000 ) Provision for loan losses ( 3,588 ) — ( 4,726 ) Transfer on deed-in-lieu of foreclosure to real estate owned — — ( 19,774 ) Net fees capitalized into carrying value of loans ( 584 ) ( 231 ) 0 Balance at December 31, $ 842,278 $ 665,498 $ 441,814 |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2022 | |
Accounting Policies [Abstract] | |
Basis of Accounting | Basis of Accounting The accompanying consolidated financial statements and related footnotes have been prepared in conformity with U.S. generally accepted accounting principles (“GAAP”) and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities as of the date of the financial statements and the reported amounts of income and expenses during the reported periods. Actual results could differ from such estimates. Certain amounts in the prior period consolidated financial statements have been reclassified to conform with the current year presentation. |
Principles of Consolidation | Principles of Consolidation The Company consolidates all entities that the Company controls through either majority ownership or voting rights. The accompanying consolidated financial statements include the accounts of the Company and the Operating Partnership. All intercompany accounts and transactions have been eliminated in consolidation. In determining whether the Company has a controlling financial interest in a joint venture and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the other partners or members as well as whether the entity is a variable interest entity (“VIE”) for which the Company is the primary beneficiary. The Company has determined the Operating Partnership is a VIE of which the Company is the primary beneficiary. Substantially all of the Company’s assets and liabilities are held by the Operating Partnership. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash Cash and cash equivalents include funds on deposit with financial institutions, including demand deposits with financial institutions with original maturities of three months or less. The account balance may exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage limits and, as a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage limits. The Company believes that the risk will not be significant, as the Company does not anticipate the financial institutions’ non-performance. Restricted cash represents cash the Company is required to hold in a segregated account as additional collateral on real estate securities repurchase agreements. As of December 31, 2022 and 2021, no restricted cash was held by the Company. |
Credit Facility Payable | Credit Facility Payable The Company has a credit facility to finance the acquisition or origination of commercial mortgage loans. This credit facility, when drawn upon, is accounted for as debt. The fees paid for this credit facility are recorded in deferred debt finance costs on the consolidated balance sheet and are amortized straight line over the period of the agreement to debt finance costs on the consolidated statement of operations. For further information on the credit facility, see “Note 5 – Repurchase Agreements and Credit Facilities.” |
Real Estate Securities at Fair Value | Real Estate Securities at Fair Value The Company’s real estate securities were comprised of CMBS and were accounted for in accordance with ASC Topic 320, Investments — Debt and Equity Securities (“ASC 320”). The Company has chosen to make a fair value option election pursuant to ASC Topic 825 , Financial Instruments for its securities and, therefore, its real estate securities are recorded at fair value on the consolidated balance sheets while they were still held by the Company. The periodic changes in fair value were recorded in period earnings on the consolidated statements of operations as a component of net unrealized gain (loss) in value of real estate securities. These investments generally meet the requirements to be classified as available-for-sale under ASC 320, which requires the securities to be carried at fair value on the balance sheet with changes in fair value recorded to other comprehensive income on the Company’s consolidated statement of changes in stockholders’ equity. Electing the fair value option allowed the Company to record changes in fair value of its investments in the consolidated statements of operations which, in management’s view, more appropriately reflected the results of operations for periods during which they were held. The Company recorded its transactions in securities on a trade date basis and recognizes realized gains and losses on securities transactions on an identified cost basis. The Company sold all of its real estate securities during the year ended December 31, 2020 and held no real estate securities as of December 31, 2022 and 2021. |
Commercial Mortgage Loans Held for Investment and Allowance for Loan Losses | Commercial Mortgage Loans Held for Investment and Allowance for Loan Losses Commercial mortgage loans are held for investment purposes and are anticipated to be held until maturity. Accordingly, they are carried at cost, net of unamortized loan fees and origination costs, and premiums or discounts. Commercial mortgage loans that are deemed to be impaired will be carried at amortized cost less a specific allowance for loan losses. Interest income is recorded on the accrual basis and related discounts, premiums and net deferred fees or costs on investments are amortized over the life of the investment using the effective interest method. Amortization is reflected as an adjustment to interest income in the Company’s consolidated statements of operations. Upon measurement of impairment, the Company records an allowance for loan losses to reduce the carrying value of the loan with a corresponding charge through the provision for loan losses on the Company’s consolidated statements of operations. The allowance for loan losses reflects management's estimate of loan losses inherent in the loan portfolio as of the balance sheet date. The Company uses a uniform process for determining its allowance for loan losses. The allowance for loan losses includes an asset-specific component and may include a general, formula-based component when the portfolio is determined to be of sufficient size to warrant such a reserve. The asset-specific reserve component relates to reserves for losses on individual impaired loans. The Company considers a loan to be impaired when, based upon current information and events, it believes that it is probable that the Company will be unable to collect all amounts due under the contractual terms of the loan agreement. This assessment is made on an individual loan basis each quarter based on such factors as payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographic location, as well as national and regional economic factors. A reserve is established for an impaired loan when the present value of payments expected to be received, observable market prices or the estimated fair value of the collateral (for loans that are dependent on the collateral for repayment) is lower than the carrying value of that loan. For collateral dependent impaired loans, impairment is measured using the estimated fair value of collateral less the estimated cost to sell. Valuations are performed or obtained at the time a loan is determined to be impaired and designated non-performing, and they are updated if circumstances indicate that a significant change in value has occurred. The Advisor generally will use the income approach through internally developed valuation models to estimate the fair value of the collateral for such loans. In more limited cases, the Advisor will obtain external “as is” appraisals for loan collateral, generally when third party participations exist. General reserves are recorded when (i) available information as of each balance sheet date indicates that it is probable a loss has occurred in the portfolio and (ii) the amount of the loss can be reasonably estimated. The Company’s policy is to estimate loss rates based on actual losses experienced, if any, or based on historical realized losses experienced in the industry if the Company has not experienced any losses. Current collateral and economic conditions affecting the probability and severity of losses are taken into account when establishing the allowance for loan losses. The Company performs a comprehensive analysis of its loan portfolio and assigns risk ratings to loans that incorporate management's current judgments about their credit quality based on all known and relevant internal and external factors that may affect collectability. The Company considers, among other things, payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographic location, as well as national and regional economic factors. This methodology results in loans being segmented by risk classification into risk rating categories that are associated with estimated probabilities of default and principal loss. Ratings range from “ 1 ” to “ 5 ” with “1” representing the lowest risk of loss and “5” representing the highest risk of loss. Loans are generally placed on non-accrual status when principal or interest payments are past due 90 days or more or when there is reasonable doubt that principal or interest will be collected in full. Accrued and unpaid interest is generally reversed against interest income in the period the loan is placed on non-accrual status. Interest payments received on non-accrual loans may be recognized as income or applied to principal depending upon management's judgment regarding the borrower's ability to make pending principal and interest payments. Non-accrual loans are restored to accrual status when past due principal and interest is paid and, in management's judgment, are likely to remain current. The Company may make exceptions to placing a loan on non-accrual status if the loan has sufficient collateral value and is in the process of collection. As of December 31, 2022 and 2021 , the Company had $ 842,278 and $ 665,498 of commercial mortgage loans held for investment, respectively. The Company recorded an allowance for loan losses of $ 3,588 as of December 31, 2022. See Note 3 – “Commercial Mortgage Loans Held for Investment - Allowance for Loan Losses" and See Note 16 – “Subsequent Events - Loan Loss Reserve" for further information. The Company did no t record any allowance for loan losses as of December 31, 2021 as the Company did not consider any loan losses to be probable at that time. |
Interest Income | Interest Income Interest income on CMBS, which includes accretion of discounts and amortization of premiums on such CMBS, and on commercial loans, which includes origination fees paid by borrowers, is recognized over the life of the investment using the effective interest method. Management estimates, at the time of purchase, the future expected cash flows and determines the effective interest rate based on these estimated cash flows and the Company’s purchase price. As needed, these estimated cash flows are updated and a revised yield is computed based on the current amortized cost of the investment. In estimating these cash flows, there are a number of assumptions that are subject to uncertainties and contingencies, including the rate and timing of principal payments (prepayments, repurchases, defaults and liquidations), the pass through or coupon rate and interest rate fluctuations. In addition, management must use its judgment to estimate interest payment shortfalls due to delinquencies on the underlying mortgage loans. These uncertainties and contingencies are difficult to predict and are subject to future events that may impact management’s estimates and the Company’s interest income. |
Real Estate Owned | Real Estate Owned Real estate owned (“REO”) represents real estate acquired by the Company through foreclosure, deed-in-lieu of foreclosure, or purchase. For real estate acquired by the Company through foreclosure or deed-in-lieu of foreclosure, REO assets are recorded at fair value at acquisition and are presented net of accumulated depreciation. For REO assets acquired through purchase, REO assets are recorded at cost at acquisition and are presented net of accumulated depreciation. REO assets are depreciated using the straight-line method over estimated useful lives of up to 40 years for buildings and improvements and up to 15 years for furniture, fixtures and equipment. Renovations and/or replacements that improve or extend the life of the real estate asset are capitalized and depreciated over their estimated useful lives. |
Revenue from Real Estate Owned | Revenue from Real Estate Owned Revenue from REO represents revenue associated with the operations of a hotel property classified as REO. Revenue from the operation of the hotel property is recognized when guestrooms are occupied, services have been rendered or fees have been earned. Revenues are recorded net of any discounts and sales and other taxes collected from customers. Revenues consist of room sales, food and beverage sales and other hotel revenues. |
Leases | Leases Finance lease right of use ("ROU") assets represent the Company’s right to use an underlying asset during the lease term, and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. ROU assets are recorded based on the fair value of the underlying property. Lease liabilities are recognized at commencement date based on the present value of fixed lease payments over the lease term. Leases will be classified as either a finance or operating lease, with such classification affecting the pattern and classification of expense recognition in the consolidated statements of operations. For leases greater than 12 months, the Company determines, at the inception of the contract, if the arrangement meets the classification criteria for an operating or finance lease. For leases that have extension options, which can be exercised at the Company's discretion, management uses judgment to determine if it is reasonably certain that such extension options will be elected. If the extension options are reasonably certain to occur, the Company includes the extended term's lease payments in the calculation of the respective lease liability. Total lease expense is recognized as interest on the finance lease liability and amortization of the ROU asset on a straight-line basis over the lease term. The incremental borrowing rate used to discount the lease liability is determined at commencement of the lease, or upon modification of the lease, as the interest rate a lessee would have to pay to borrow on a fully collateralized basis over a similar term an amount equal to the lease payments in a similar economic environment. The Company's incremental borrowing rate considers information at both the corporate and property level and analysis of current market conditions for obtaining new financings. As of December 31, 2022, the Company had one finance lease assumed as part of a deed-in-lieu of foreclosure of a hotel property during August 2020. |
Fair Value Measurements | Fair Value Measurements The Company estimates fair value using available market information and valuation methodologies it believes to be appropriate for these purposes. The Company defines fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. ASC Topic 820 , Fair Value Measurements establishes a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy consists of three broad levels, which are described below: • Level I - Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date. • Level II - Inputs (other than quoted prices included in Level I) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. • Level III - Unobservable inputs which reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. The determination of where an asset or liability falls in the above hierarchy requires judgment and factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. The Company is required by GAAP to disclose fair value information about financial instruments that are not otherwise reported at fair value in its consolidated balance sheets, to the extent it is practicable to estimate a fair value for those instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments. |
Organization and Offering Expenses | Organization and Offering Expenses The Company conducted an IPO that commenced following the conclusion of the Private Offering on June 28, 2019. The IPO concluded and the Second Public Offering began when the S-11 for the Second Public Offering was declared effective by the SEC on November 2, 2022 (File No. 333-264540). For classes of shares sold in the Public Offerings, the purchase price per share is based on a monthly NAV published around the 15 th of the month preceding its effective date with the valuation based on the end of the previous month. For the Private Offering, the purchase price per Class P Share was equal to $ 25.00 (the “Transaction Price”) plus applicable selling commissions, dealer manager fees and organization and offering expenses, resulting in a total purchase price of $ 27.38 per Class P Share if maximum selling commissions, dealer manager fees and organization and offering expenses were paid. The Dealer Manager was the dealer manager for the Private Offering and the IPO and is the dealer manager for the Second Public Offering. Organization and offering expenses include all expenses incurred in connection with the Private Offering and Public Offerings. Organization and offering expenses (other than selling commissions, dealer manager fees and stockholder servicing fees) of the Company may be paid by the Advisor, Sub-Advisor, the Dealer Manager, or their respective affiliates on behalf of the Company and subsequently reimbursed by the Company. For the Private Offering, offering expenses were deferred and a payable was recognized to the Advisor or Sub-Advisor until shares were sold in the Private Offering, at which point the expense reimbursement was paid from additional paid-in capital. For the Public Offerings, offering costs are offset against additional paid-in capital when incurred. These expenses include but are not limited to: (i) reimbursing the Dealer Manager and participating broker-dealers for bona fide out-of-pocket, itemized and detailed due diligence expenses incurred by these entities, (ii) expenses for printing and mailing, charges of transfer agents, registrars, trustees, escrow holders, depositaries and experts, and (iii) expenses of qualifying the sale of the shares under federal and state laws, including taxes and fees and accountants’ and attorneys’ fees and expenses. The Company reimbursed the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the Private Offering not in excess of the organization and offering expenses paid by investors in connection with the sale of Class P Shares in the Private Offering. The Company also reimburses the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the IPO, provided the Advisor has agreed to reimburse the Company to the extent that the organization and offering expenses that the Company incurs exceeds 15 % of its gross proceeds from the Public Offerings. |
Repurchase Agreements | Repurchase Agreements The Company enters into master repurchase agreements that allow the Company to sell real estate loans and securities while providing a fixed repurchase price for the same real estate loans and securities in the future. Repurchase agreements are being accounted for as secured borrowings since the Company maintains effective control of the financed assets. Under the master repurchase agreements, the respective lender retains the right to mark the underlying collateral to fair value. |
Senior Loan Participations | Senior Loan Participations For several first mortgage loans, the Company sold a non-recourse senior loan participation interest to a third party and retained a subordinate participation interest. These do not qualify as sales under GAAP and are instead presented in a manner similar to a secured borrowing. On the balance sheet, there is a gross presentation with the full loan receivable recorded in Commercial mortgage loans at cost and an offsetting liability to the third party recorded in Loan participations sold, net. Interest income on the mortgage loans continues to be recorded as described above with interest amounts due to the third party for its senior loan participation interest recorded in interest expense. |
Equity-Based Compensation | Equity-Based Compensation In accordance with the Company’s Independent Director Restricted Share Plan (the “RSP”), restricted shares are issued to independent directors as compensation. The Company recognizes expense related to the fair value of equity-based compensation awards as operating expense in the consolidated statements of operations. The Company recognizes expense based on the fair value at the grant dated on a straight-line basis over the vesting period representing the requisite service period. See Note 12 – “Equity-Based Compensation” for further information. |
Income Taxes | Income Taxes The Company qualifies as a REIT under the Internal Revenue Code of 1986, as amended, for federal income tax purposes commencing with the tax year ended December 31, 2017 and qualifies for taxation as a REIT. The Company generally will not be subject to federal income tax to the extent it distributes its REIT taxable income, subject to certain adjustments, to its stockholders. Subsequently, if the Company fails to qualify as a REIT in any taxable year, the Company will be subject to federal income tax on its taxable income at regular corporate tax rates. Even if the Company qualifies for taxation as a REIT, the Company may be subject to certain state and local taxes on its income, property or net worth and federal income and excise taxes on its undistributed income. The Company had no uncertain tax positions as of December 31, 2022 or 2021 . The Company expects no significant increases or decreases in uncertain tax positions due to changes in tax positions within one year of December 31, 2022 . The Company had no interest or penalties relating to income taxes recognized in the consolidated statements of operations for the years ended December 31, 2022, 2021 or 2020. As of December 31, 2022, returns for the calendar years 2019, 2020, 2021 and 2022 remain subject to examination by U.S. and various state and local tax jurisdictions. Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. The Company operates the Renaissance O’Hare Suites Hotel (the “Renaissance O’Hare”) through a taxable REIT subsidiary (“TRS”) that has engaged a third-party hotel management company to manage the hotel under a management contract. The TRS generated operating losses of $ 2,345 and $ 1,661 in the years ended December 31, 2021 and 2020, respectively. Based on an effective tax rate of 28.51 %, which is calculated by combining a 21 % Federal tax rate and an IL tax rate of 7.51 % ( 9.5 % state rate net of the Federal benefit), the deferred tax benefit related to the operating loss is approximately $ 669 and $ 474 for the years ended December 31, 2021 and 2020, respectively. The projected estimated taxable income generated by the Renaissance O'Hare for the year ended December 31, 2022 is $ 608 , decreasing the deferred tax asset related to net operating losses to $ 994 . At December 31, 2022, it is more likely than not that the Company will not generate sufficient taxable income to fully realize the tax deferred tax asset related to the Company’s TRS, therefore the Company maintains a full valuation allowance on its deferred tax asset of $ 994 . If the operating results of the Renaissance O'Hare stabilize, management will reassess the need for this reserve. These losses do not expire. |
Distributions Payable | Distributions Payable Distributions payable represent distributions declared as of the balance sheet date which are payable to stockholders. |
Per Share Data | Per Share Data The Company calculates basic and diluted earnings per share by dividing net income attributable to the Company for the period by the weighted-average number of shares of common stock outstanding for that period. Basic earnings (loss) per share (“EPS”) is computed by dividing net income by the weighted average number of common shares outstanding for the period. Diluted EPS is computed by dividing net income by the common shares plus common share equivalents. For further information about the Company’s calculation of EPS, see Note 8 – “Net Income Per Share Attributable to Common Stockholders.” |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board (“FASB”) issued ASU 2016-13, “Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”), which changed how entities measure credit losses for financial assets carried at amortized cost. ASU 2016-13 eliminated the requirement that a credit loss must be probable before it can be recognized and instead required an entity to recognize the current estimate of all expected credit losses. ASU 2016-13 became effective for SEC filers for reporting periods beginning after December 15, 2019. In November 2019, the FASB issued ASU 2019-10, “Financial Instruments – Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842): Effective Dates,” which grants smaller reporting companies (as defined by the SEC) until reporting periods commencing after December 15, 2022 to implement ASU 2016-13. As a smaller reporting company, the Company will adopt ASU 2016-13 through a cumulative-effect adjustment to accumulated deficit as of January 1, 2023. The Current Expected Credit Loss (“CECL”) reserve required under ASU 2016-13 is a valuation account that is deducted from the amortized cost basis of the related loans on the consolidated balance sheet, which will reduce the stockholders’ equity. The initial CECL reserve recorded on January 1, 2023 will be reflected as a direct charge against retained earnings; however, future net changes to the CECL reserve will be recognized in net income on the consolidated statement of operations. ASU 2016-13 does not require use of a particular method for determining the CECL reserve, but it does specify the allowance should be based on relevant information about past events, including historical loss experience, composition of the current loan portfolio, current conditions, and reasonable and supportable forecasts for the expected term of each loan. Additionally, but for a few narrow exceptions, ASU 2016-13 does not have a minimum threshold for recognition of impairment losses and requires that all financial instruments, including those for which there is a low risk of loss, incur some amount of valuation reserve to reflect the inherent risk of loss regardless of credit quality, amount of subordinate capital, or other risk mitigants. For the majority of the portfolio, the Company elected to utilize a widely-used analytical model, at the individual loan level, incorporating a probability of default and loss-given-default methodology and loan performance data for commercial real estate loans dating back to 1965. For one loan in the portfolio, the Company determined that an analytical model was not appropriate. In cases where the Company feels there is potential impairment, the CECL reserve is assessed by comparing the estimated fair value of the underlying collateral, less the cost to sell, to the book value of the respective loans. These valuations require significant judgment, which may include assumptions regarding capitalization rates, discount rates, leasing, creditworthiness of major tenants, occupancy rates, availability and cost of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed relevant by the Company. Actual losses, if any, could ultimately differ materially from these estimates. The Company only expects to realize the impairment losses if and when such amounts are deemed nonrecoverable upon a realization event. This is generally at the time a loan is repaid, or in the case of foreclosure, when the underlying asset is sold, but non-recoverability may also be concluded if, in our determination, it is nearly certain that all amounts due will not be collected. The loans may include commitments to fund incremental proceeds to the borrowers over the life of the loan, which are also subject to the CECL model. The CECL reserve related to future funding commitments will be recorded as a component of other liabilities on the consolidated balance sheet and be estimated using the same process as for the outstanding loan balances. Though the Company is still in the process of finalizing the effect of ASU 2016-13, the Company expects to record an additional allowance for credit losses in the range of $ 5,000 to $ 7,000 , which includes the amount attributable to future funding commitments, as of January 1, 2023 through a cumulative-effect adjustment to accumulated deficit. |
Commercial Mortgage Loans Hel_2
Commercial Mortgage Loans Held for Investment (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Mortgage Loans On Real Estate [Abstract] | |
Schedule of Commercial Mortgage Loans Held for Investment | The following is a summary of the Company’s commercial mortgage loans held for investment as of December 31, 2022: Number of Principal Balance Unamortized Allowance for loan losses Carrying Value Weighted Average Weighted Average First mortgage loans 41 $ 831,007 $ 1,359 $ ( 3,588 ) $ 828,778 7.7 % 1.4 Credit loans 2 13,500 — — 13,500 9.6 % 3.4 Total and average 43 $ 844,507 $ 1,359 $ ( 3,588 ) $ 842,278 7.8 % 1.4 The following is a summary of the Company’s commercial mortgage loans held for investment as of December 31, 2021: Number of Principal Balance Unamortized Carrying Value Weighted Average Weighted Average First mortgage loans 36 $ 650,670 $ 1,328 $ 651,998 4.5 % 1.6 Credit loans 2 13,500 — 13,500 9.6 % 4.4 Total and average 38 $ 664,170 $ 1,328 $ 665,498 4.6 % 1.7 |
Schedule of Commercial Mortgage Loans held for Investment Portfolio | For the years ended December 31, 2022 and 2021, the activity in the Company’s commercial mortgage loans, held-for-investment portfolio was as follows: Year Ended December 31, 2022 Year Ended December 31, 2021 Balance at Beginning of Year $ 665,498 $ 441,814 Loan originations 300,576 337,033 Principal repayments ( 120,240 ) ( 114,558 ) Amortization of loan origination and deferred exit fees 616 1,440 Origination fees and extension fees received on commercial loans ( 584 ) ( 231 ) Provision for loan losses ( 3,588 ) — Balance at End of Period $ 842,278 $ 665,498 |
Schedule of Allowance for Loan Losses | The following table presents the activity in the Company's allowance for loan losses: Year Ended December 31, 2022 Year Ended December 31, 2021 Beginning of period $ — $ — Provision for loan losses ( 3,588 ) — Charge-offs — — Ending allowance for loan losses $ ( 3,588 ) $ — |
Summary of Investment Grade of Loans Loss | As part of the Company’s process for monitoring the credit quality of its investments, it performs a quarterly asset review of the investment portfolio and assigns risk ratings to each of its loans and CMBS. Risk factors include payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographic location, as well as national and regional economic factors. To determine the likelihood of loss, the loans are rated on a 5-point scale as follows: Investment Grade Investment Grade Definition 1 Investment exceeding fundamental performance expectations and/or capital gain expected. Trends and risk factors since time of investment are favorable. 2 Performing consistent with expectations and a full return of principal and interest expected. Trends and risk factors are neutral to favorable. 3 Performing investment requiring closer monitoring. Trends and risk factors show some deterioration. Collection of principal and interest is still expected. 4 Underperforming investment with the potential of some interest loss but still expecting a positive return on investment. Trends and risk factors are negative. 5 Underperforming investment with expected loss of interest and some principal. |
Repurchase Agreements and Cre_2
Repurchase Agreements and Credit Facilities (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure Of Repurchase Agreements [Abstract] | |
Schedule of Outstanding Repurchase Agreements | The details of the Facilities as of December 31, 2022 and 2021 are as follows: December 31, 2022 Weighted Average Committed Amount Accrued Collateral Interest Days to CF Repo Facility $ 375,000 $ 356,094 $ 882 $ 494,962 6.89 % 679 JPM Repo Facility 150,000 131,992 305 181,972 6.40 % 492 Repurchase agreements - commercial mortgage loans 525,000 488,086 1,187 676,934 6.76 % 628 WA Credit Facility 75,000 18,380 16 29,797 7.64 % 435 $ 600,000 $ 506,466 $ 1,203 $ 706,731 6.79 % 621 December 31, 2021 Weighted Average Committed Amount Accrued Collateral Interest Days to CF Repo Facility $ 350,000 $ 189,654 $ 159 $ 260,691 2.16 % 314 JPM Repo Facility 150,000 117,470 92 167,704 2.02 % 126 Repurchase agreements - commercial mortgage loans 500,000 307,124 251 428,395 2.11 % 242 WA Credit Facility 75,000 14,350 22 20,500 4.00 % 434 $ 575,000 $ 321,474 $ 273 $ 448,895 2.19 % 251 ____________ (1) Excluding $ 3 and $ 41 of unamortized debt issuance costs as of December 31, 2022 and 2021, respectively. |
Loan Participations Sold, Net (
Loan Participations Sold, Net (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Mortgage Loans On Real Estate [Abstract] | |
Summary of Loan Participations Sold | The following tables detail the Company’s loan participations sold as of December 31, 2022 and 2021: December 31, 2022 Loan Participations Sold Count Principal Balance Book Value Yield/Cost (1) Guarantee (2) Weighted Average Maximum Maturity Total Loans 7 $ 124,275 $ 121,431 L+ 3.7 % n/a 1.22 Senior participations (3) 7 $ 99,420 $ 99,420 L+ 2.0 % n/a 1.22 December 31, 2021 Loan Participations Sold Count Principal Balance Book Value Yield/Cost (1) Guarantee (2) Weighted Average Maximum Maturity Total Loans 9 $ 137,215 $ 137,931 L+ 3.6 % n/a 2.22 Senior participations (3) 9 $ 109,772 $ 109,772 L+ 2.0 % n/a 2.22 ____________ (1) The yield/cost is the present value of all future principal and interest payments on the loan or participation interest and does not include any origination fees or deferred commitment fees. (2) As of December 31, 2022 and 2021, the loan participations sold were non-recourse to the Company. (3) During the years ended December 31, 2022 and 2021, the Company recorded $ 3,952 and $ 281 of interest expense related to loan participations sold. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Equity [Abstract] | |
Schedule of Change in Outstanding Shares Including Restricted Common Stock | The following tables detail the change in the Company’s outstanding shares of all class of common and preferred stock, including restricted common stock: Preferred Stock Common Stock Year ended December 31, 2022 Series A Class P Class A Class T Class S Class D Class I Beginning balance 3,600,000 9,492,939 659,270 388,099 — 47,298 380,218 Issuance of shares — — 107,721 46,977 — — 67,316 Repurchase and retirement of preferred stock ( 51,304 ) — — — — — — Distribution reinvestment — — 12,662 6,307 — 1,548 16,212 Issuance of restricted shares — — — — — — 1,534 Redemptions — ( 930,162 ) ( 36,470 ) ( 155,042 ) — ( 958 ) ( 12,613 ) Ending balance 3,548,696 8,562,777 743,183 286,341 — 47,888 452,667 Preferred Stock Common Stock Year ended December 31, 2021 Series A Class P Class A Class T Class S Class D Class I Beginning balance — 10,151,787 655,835 398,233 — 50,393 381,955 Issuance of shares 3,600,000 — 4,801 3,673 — — 976 Distribution reinvestment — — 10,992 5,687 — 1,748 10,420 Issuance of restricted shares — — — — — — 1,477 Redemptions — ( 658,848 ) ( 12,358 ) ( 19,494 ) — ( 4,843 ) ( 14,610 ) Ending balance 3,600,000 9,492,939 659,270 388,099 — 47,298 380,218 Common Stock Year ended December 31, 2020 Class P Class A Class T Class S Class D Class I Beginning balance 10,182,305 272,006 121,718 — 41,538 100,743 Issuance of shares — 379,250 274,570 — 8,066 276,618 Distribution reinvestment — 4,579 1,945 — 789 3,201 Issuance of restricted shares — — — — — 1,393 Redemptions ( 30,518 ) — — — — — Ending balance 10,151,787 655,835 398,233 — 50,393 381,955 |
Schedule of Distributions Declared | The table below presents the aggregate annualized and monthly distributions declared on common stock by record date for all classes of shares since the Company resumed paying distributions. Record date Aggregate annualized gross distribution declared per share of common stock Aggregate monthly gross distribution declared per share of common stock July 31, 2020 $ 0.8576 $ 0.0715 August 31, 2020 $ 0.8800 $ 0.0733 September 30, 2020 $ 0.9000 $ 0.0750 October 31, 2020 $ 0.9000 $ 0.0750 November 30, 2020 $ 0.9000 $ 0.0750 December 31, 2020 $ 0.9000 $ 0.0750 January 31, 2021 $ 0.9500 $ 0.0792 February 28, 2021 $ 1.0000 $ 0.0833 March 31, 2021 $ 1.0500 $ 0.0875 April 30, 2021 $ 1.1000 $ 0.0917 May 31, 2021 $ 1.1500 $ 0.0958 June 30, 2021 $ 1.2500 $ 0.1042 July 31, 2021 $ 1.2500 $ 0.1042 August 31, 2021 $ 1.2500 $ 0.1042 September 30, 2021 $ 1.2500 $ 0.1042 October 31, 2021 $ 1.2500 $ 0.1042 November 30, 2021 $ 1.2500 $ 0.1042 December 31, 2021 $ 1.2500 $ 0.1042 January 31, 2022 $ 1.2500 $ 0.1042 February 28, 2022 $ 1.2500 $ 0.1042 March 31, 2022 $ 1.2500 $ 0.1042 April 30, 2022 $ 1.2500 $ 0.1042 May 31, 2022 $ 1.2500 $ 0.1042 June 30, 2022 $ 1.2500 $ 0.1042 July 31, 2022 $ 1.2500 $ 0.1042 August 31, 2022 $ 1.2500 $ 0.1042 September 30, 2022 $ 1.2500 $ 0.1042 October 31, 2022 $ 1.2500 $ 0.1042 November 30, 2022 $ 1.2500 $ 0.1042 December 31, 2022 $ 1.2500 $ 0.1042 The following table shows the monthly net distribution per share for shares of Class D and Class T common stock since the Company resumed paying distributions. Record date Monthly net distribution declared per share of Class D common stock Monthly net distribution declared per share of Class T common stock July 31, 2020 $ 0.0670 $ 0.0560 August 31, 2020 $ 0.0688 $ 0.0578 September 30, 2020 $ 0.0706 $ 0.0600 October 31, 2020 $ 0.0704 $ 0.0594 November 30, 2020 $ 0.0706 $ 0.0600 December 31, 2020 $ 0.0704 $ 0.0595 January 31, 2021 $ 0.0749 $ 0.0646 February 28, 2021 $ 0.0794 $ 0.0701 March 31, 2021 $ 0.0832 $ 0.0729 April 30, 2021 $ 0.0876 $ 0.0776 May 31, 2021 $ 0.0915 $ 0.0813 June 30, 2021 $ 0.1000 $ 0.0900 July 31, 2021 $ 0.0999 $ 0.0896 August 31, 2021 $ 0.0999 $ 0.0895 September 30, 2021 $ 0.1000 $ 0.0900 October 31, 2021 $ 0.0999 $ 0.0895 November 30, 2021 $ 0.1000 $ 0.0901 December 31, 2021 $ 0.0999 $ 0.0897 January 31, 2022 $ 0.0999 $ 0.0896 February 28, 2022 $ 0.1003 $ 0.0910 March 31, 2022 $ 0.0999 $ 0.0898 April 30, 2022 $ 0.1001 $ 0.0903 May 31, 2022 $ 0.1000 $ 0.0899 June 30, 2022 $ 0.1001 $ 0.0904 July 31, 2022 $ 0.1000 $ 0.0899 August 31, 2022 $ 0.1000 $ 0.0900 September 30, 2022 $ 0.1001 $ 0.0905 October 31, 2022 $ 0.1000 $ 0.0900 November 30, 2022 $ 0.1002 $ 0.0905 December 31, 2022 $ 0.1000 $ 0.0900 The table below presents the aggregate distributions declared per share for each applicable class of common stock and preferred stock during the years ended December 31, 2022, 2021 and 2020. The tables exclude from dividend declaration any month when there were no outstanding shares for a class of stock. Year ended December 31, 2022 Preferred Stock Common Stock Series A Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 1.6875 $ 1.2504 $ 1.2504 $ 1.2504 $ — $ 1.2504 $ 1.2504 Stockholder servicing fee per share N/A N/A N/A 0.1685 — 0.0498 N/A Net distributions declared per share $ 1.6875 $ 1.2504 $ 1.2504 $ 1.0819 $ — $ 1.2006 $ 1.2504 Year ended December 31, 2021 Preferred Stock (1) Common Stock Series A Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.4594 $ 1.1669 $ 1.1669 $ 1.1669 $ — $ 1.1669 $ 1.1669 Stockholder servicing fee per share N/A N/A N/A 0.1720 — 0.0507 N/A Net distributions declared per share $ 0.4594 $ 1.1669 $ 1.1669 $ 0.9949 $ — $ 1.1162 $ 1.1669 Year ended December 31, 2020 Common Stock Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.7648 $ 0.7148 $ 0.7148 $ — $ 0.7148 $ 0.7148 Stockholder servicing fee per share N/A N/A $ 0.1270 — 0.0373 N/A Net distributions declared per share $ 0.7648 $ 0.7148 $ 0.5878 $ — $ 0.6775 $ 0.7148 (1) Distributions on preferred stock are only for a partial year following their issuance on September 22, 2021. |
Net Income Per Share Attribut_2
Net Income Per Share Attributable to Common Stockholders (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Net (Loss) Income Per Share Attributable to Common Stockholders | The following table is a summary of the basic and diluted net (loss) income per share attributable to common stockholders computation for the years ended December 31, 2022, 2021 and 2020: Year Ended December 31, 2022 Year Ended December 31, 2021 Year Ended December 31, 2020 Net income (loss) attributable to common stockholders $ 4,430 $ 8,219 $ ( 28,784 ) Weighted average shares outstanding, basic 10,605,242 11,480,517 11,561,828 Weighted average shares outstanding, diluted 10,606,072 11,481,464 11,561,828 Net income (loss) per share attributable to common stockholders, basic and diluted $ 0.42 $ 0.72 $ ( 2.49 ) |
Transactions with Related Par_2
Transactions with Related Parties (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Related Party Transactions [Abstract] | |
Summary of Related Party Transactions | The following table summarizes the Company’s related party transactions for the years ended December 31, 2022, 2021 and 2020: Year Ended Year Ended Year Ended Payable as of December 31, 2022 December 31, 2021 December 31, 2020 2022 2021 Organization and offering expense reimbursement (1) $ — $ 26 $ 70 $ — $ — Selling commissions and dealer manager fee (2) 155 8 758 — — Advisory fee (3) 3,692 3,217 5,528 296 321 Loan fees (4) 3,714 4,597 1,508 1,419 1,983 Accrued stockholder servicing fee (5) ( 59 ) ( 23 ) 446 482 590 Operating expense reimbursement to Advisor (6) — 56 1 — — Total $ 7,502 $ 7,881 $ 8,311 $ 2,197 $ 2,894 ____________ (1) The Company reimburses the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the Public Offerings, provided the Advisor has agreed to reimburse the Company to the extent that the organization and offering expenses that the Company incurs exceeds 15 % of its gross proceeds from the IPO. (2) For the Public Offerings, the Dealer Manager is entitled to receive (a) upfront selling commissions of up to 6.0 %, and upfront dealer manager fees of up to 1.25 %, of the transaction price of each Class A share sold in the primary offering, however such amounts may vary at certain participating broker-dealers provided that the sum will not exceed 7.25 % of the transaction price; (b) upfront selling commissions of up to 3.0 %, and upfront dealer manager fees of 0.5 %, of the transaction price of each Class T share sold in the primary offering, however such amounts may vary at certain participating broker-dealers provided that the sum will not exceed 3.5 % of the transaction price; and (c) upfront selling commissions of up to 3.5 % of the transaction price of each Class S share sold in the primary offering. No upfront selling commissions or dealer manager fees are paid with respect to purchases of Class D shares, Class I shares or shares of any class sold pursuant to the Company’s DRP. All upfront selling commissions and dealer manager fees will be reallowed (paid) by the Dealer Manager to participating broker-dealers. (3) The Advisor is entitled to receive an advisory fee comprised of two separate components: (1) a fixed component payable monthly and (2) a performance component payable annually. Prior to July 1, 2021, the fixed component of the advisory fee was paid in an amount equal to 1/12th of 1.25 % per annum of the gross value of the Company’s assets, paid monthly in arrears, provided that any such monthly payment could not exceed 1/12 th of 2.5 % of the Company’s NAV. Effective July 1, 2021, the fixed component of the advisory fee is paid in an amount equal to 1/12 th of 1.25 % of the Company’s average NAV for each month, paid monthly in arrears. The performance component of the advisory fee is calculated and paid annually, such that for any year in which the Company’s total return per share exceeds 7 % per annum, the Advisor will receive 20 % of the excess total return allocable to shares of the Company’s common stock; provided that in no event will the performance fee exceed 15 % of the aggregate total return allocable to shares of the Company’s common stock for such year. In addition, if the NAV per share decreases below $25 for any class of shares during the measurement period, any subsequent increase in NAV per share to $ 25 (or such other adjusted number) will not be included in the calculation of the performance component with respect to that class. The Advisor waived $ 0 , $ 1,475 and $ 874 of the fixed component of the advisory fees for the years ended December 31, 2022, 2021 and 2020, respectively. For the year ended December 31, 2020, the Advisor did no t earn the performance component of the advisory fee. The Advisor pays fees to the Sub-Advisor for the services its delegates to the Sub-Advisor or may direct the Company to pay a portion of the fees otherwise payable to the Advisor directly to the Sub-Advisor. (4) The Company pays the Advisor all new loan origination and administrative fees related to CRE loans held for investment, to the extent that such fees are paid by the borrower. Pursuant to the Sub-Advisory Agreement, the Advisor generally will reallow a portion of loans fees and all administrative fees to the Sub-Advisor. (5) Subject to the Financial Industry Regulatory Authority, Inc. limitations on underwriting compensation, the Company pays the Dealer Manager selling commissions over time as stockholder servicing fees for ongoing services rendered to stockholders by participating broker-dealers or broker-dealers servicing stockholders’ accounts as follows: (a) for Class T shares only, 0.85 % per annum of the NAV of the Class T shares; (b) for Class S shares only, 0.85 % per annum of the aggregate NAV for the Class S shares; and (c) for Class D shares only, 0.25 % per annum of the aggregate NAV for the Class D shares. The Company will cease paying the stockholder servicing fee with respect to any Class T share, Class S share or Class D share held in a stockholder’s account upon the occurrence of certain events. The Company accrues the full cost of the stockholder servicing fee as an offering cost at the time the Company sells Class T, Class S, and Class D shares. The Dealer Manager does not retain any of these fees, all of which are retained by, or reallowed (paid) to, participating broker-dealers and servicing broker-dealers for ongoing stockholder services performed by such broker-dealers. (6) Prior to July 1, 2021, the Company reimbursed the Advisor for expenses that it (or the Sub-Advisor acting on the Advisor’s behalf) incurs in connection with providing services to the Company, provided that the Company did not reimburse overhead costs, including rent and utilities or personnel costs (including salaries, bonuses, benefits and severance payments) and the Company only reimbursed the Advisor for fees payable to its affiliates if they are incurred for legal or marketing services rendered on the Company’s behalf. Effective July 1, 2021, the Company is obligated to reimburse for all of the expenses attributable to the Company or its subsidiaries, including the Operating Partnership, and paid or incurred and submitted to the Company for reimbursement by the Advisor, the Sub-Advisor or their respective affiliates in providing services to the Company under the Advisory Agreement, including personnel and related employment costs. |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Total Stock Grants | The table below summarizes total stock grants made at each grant date as of December 31, 2022. Grant Date Class of common stock granted Total number of shares granted Grant Date Fair Value Per Share Total Fair Value of Grant Proportion of total shares that vest annually Vesting Date Year 1 Vesting Date Year 2 Vesting Date Year 3 March 1, 2018 Class P 1,200 $ 25.00 $ 30 1/3 3/1/2019 3/1/2020 3/1/2021 January 7, 2019 Class P 1,200 $ 25.00 $ 30 1/3 1/7/2020 1/7/2021 1/7/2022 December 2, 2019 Class I 1,197 $ 25.07 $ 30 1/3 12/2/2020 12/2/2021 12/2/2022 December 1, 2020 Class I 1,393 $ 21.54 $ 30 1/3 12/1/2021 12/1/2022 12/1/2023 October 14, 2021 Class I 1,477 $ 20.31 $ 30 1/3 10/14/2022 10/14/2023 10/14/2024 October 3, 2022 Class I 1,534 $ 19.55 $ 30 1/3 10/3/2023 10/3/2024 10/3/2025 |
Summary of Restricted Shares Granted under RSP | A summary table of the status of the restricted shares granted under the RSP is presented below: Restricted Shares Weighted Outstanding at December 31, 2021 3,205 $ 21.85 Granted 1,534 19.55 Vested ( 1,756 ) 22.79 Converted — — Forfeited — — Outstanding at December 31, 2022 2,983 $ 20.11 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Carrying Amount and Fair Value of Financial Instruments | The following table details the carrying amount and fair value of the financial instruments described in Note 2: December 31, 2022 December 31, 2021 Carrying Estimated Carrying Estimated Financial assets Cash and cash equivalents $ 29,408 $ 29,408 $ 57,268 $ 57,268 Commercial mortgage loans, net 842,278 842,278 665,498 667,405 Total $ 871,686 $ 871,686 $ 722,766 $ 724,673 Financial liabilities Repurchase agreements - commercial mortgage loans $ 488,086 $ 488,086 $ 307,083 $ 307,083 Credit facility payable 18,380 18,380 14,350 14,350 Loan participations sold 99,420 99,420 109,772 109,772 Total $ 605,886 $ 605,886 $ 431,205 $ 431,205 |
Real Estate Owned (Tables)
Real Estate Owned (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Real Estate [Abstract] | |
Schedule of Company's REO Assets | The following table summarizes the Company’s REO assets as of December 31, 2022: Acquisition Date Property Type Primary Location(s) Building and Improvements Furniture, Fixtures and Equipment Accumulated Depreciation Real Estate Owned, Net August 2020 (1)(2) Hotel Chicago, IL $ 26,699 $ 7,137 $ ( 2,621 ) $ 31,215 (1) Refer to Note 2 – “Summary of Significant Accounting Policies” for useful life of the above assets. (2) Represents hotel ground lease interest acquired by the Company by completing a deed-in-lieu of foreclosure transaction. |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Leases [Abstract] | |
Summary of Finance Lease Cost | For the years ended December 31, 2022, 2021 and 2020, total finance lease cost was comprised as follows: Years ended December 31, 2022 2021 2020 Amortization of right-of-use assets $ 72 $ 71 $ 24 Interest on lease liabilities 1,963 1,925 634 Total finance lease cost $ 2,035 $ 1,996 $ 658 |
Schedule of Finance Lease Right of Use Asset, Net of Amortization | The table below shows the Company’s finance lease right of use asset, net of amortization as of December 31, 2022 and 2021: December 31, December 31, 2022 2021 Finance lease right of use asset, gross $ 5,549 $ 5,549 Accumulated amortization ( 167 ) ( 95 ) Finance lease right of use asset, net of amortization $ 5,382 $ 5,454 |
Schedule of Lease Payments for the Ground Lease | Lease payments for the ground lease as of December 31, 2022 for each of the five succeeding years and thereafter is as follows: Lease Payments 2023 $ 1,611 2024 1,745 2025 1,772 2026 1,772 2027 1,772 Thereafter 267,914 Total undiscounted lease payments $ 276,586 Less: Amount representing interest ( 259,129 ) Present value of lease liability $ 17,457 |
Subsequent Events (Tables)
Subsequent Events (Tables) | 12 Months Ended |
Dec. 31, 2022 | |
Subsequent Events [Abstract] | |
Schedule of Declared Distributions for Class of Common Stock | On February 17, 2023 , the Company paid distributions for each class of its common stock to stockholders of record as of January 31, 2023 in the amounts per share set forth below: Common Stock Class P Class A Class T Class D Class I Aggregate gross distributions declared per share $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 Stockholder servicing fee per share N/A N/A 0.0142 0.0042 N/A Net distributions declared per share $ 0.1042 $ 0.1042 $ 0.0900 $ 0.1000 $ 0.1042 On March 17, 2023 , the Company paid distributions for each class of its common stock to stockholders of record as of February 28, 2023 in the amounts per share set forth below: Common Stock Class P Class A Class T Class D Class I Aggregate gross distributions declared per share $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 $ 0.1042 Stockholder servicing fee per share N/A N/A 0.0128 0.0038 N/A Net distributions declared per share $ 0.1042 $ 0.1042 $ 0.0914 $ 0.1004 $ 0.1042 |
Organization and Business Ope_2
Organization and Business Operations - Additional Information (Details) - USD ($) | 12 Months Ended | 32 Months Ended | |||||||||
Apr. 28, 2022 | Oct. 15, 2021 | Oct. 01, 2021 | Sep. 22, 2021 | Mar. 22, 2019 | Oct. 25, 2016 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Jun. 28, 2019 | Jun. 30, 2021 | |
Organization And Business Operations [Line Items] | |||||||||||
Issuance of common stock, shares | $ 4,529,000 | $ 199,000 | $ 24,269,000 | ||||||||
Stock repurchase shares | 0 | ||||||||||
Preferred stock, par value | $ 0.001 | $ 0.001 | |||||||||
Maximum | Share Repurchase Program | |||||||||||
Organization And Business Operations [Line Items] | |||||||||||
Percentage of aggregate net asset value per month | 2% | ||||||||||
Percentage of aggregate net asset value per quarter | 5% | ||||||||||
Maximum | Public Offerings | |||||||||||
Organization And Business Operations [Line Items] | |||||||||||
Issuance of common stock, shares | $ 2,200,000,000 | $ 2,350,000,000 | |||||||||
Class P Common Stock | |||||||||||
Organization And Business Operations [Line Items] | |||||||||||
Shares issued, private offering | 10,258,094 | ||||||||||
Gross proceeds from issuance of private offering | $ 276,681,000 | ||||||||||
Class P Common Stock | Maximum | |||||||||||
Organization And Business Operations [Line Items] | |||||||||||
Shares issued value, private offering | $ 500,000,000 | ||||||||||
Series A Preferred Stock | |||||||||||
Organization And Business Operations [Line Items] | |||||||||||
Liquidation preference per share | $ 25 | ||||||||||
Series A Preferred Stock | Preferred Stock Offering | |||||||||||
Organization And Business Operations [Line Items] | |||||||||||
Preferred stock, shares issued | 3,500,000 | ||||||||||
Percentage of cumulative redeemable preferred stock | 6.75% | ||||||||||
Preferred stock, par value | $ 0.001 | ||||||||||
Liquidation preference per share | $ 25 | ||||||||||
Net proceeds after underwriter's discount and issuance costs | $ 86,310,000 | ||||||||||
Series A Preferred Stock | Over-Allotment | Raymond James & Associates, Inc. | |||||||||||
Organization And Business Operations [Line Items] | |||||||||||
Additional shares issued to cover over-allotments | 100,000 |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) | 12 Months Ended | 42 Months Ended | |||||||
Dec. 31, 2022 USD ($) Rating | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | Dec. 31, 2022 USD ($) | Jan. 01, 2023 USD ($) | Dec. 31, 2019 USD ($) | Jun. 28, 2019 $ / shares | |||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Cash and cash equivalents, description | Cash and cash equivalents include funds on deposit with financial institutions, including demand deposits with financial institutions with original maturities of three months or less. | ||||||||
Restricted cash current | $ 0 | $ 0 | $ 0 | ||||||
Real estate securities at fair value | 0 | 0 | 0 | ||||||
Commercial mortgage loans held for investment | 842,278,000 | [1] | 665,498,000 | $ 441,814,000 | 842,278,000 | [1] | $ 504,702,000 | ||
Allowance for loan losses | 3,588,000 | 0 | 3,588,000 | ||||||
Uncertain tax positions | 0 | 0 | $ 0 | ||||||
Uncertain tax positions, period increase (decrease) | 0 | ||||||||
Uncertain tax positions, income tax interest or penalties | $ 0 | 0 | 0 | ||||||
Effective tax rate | 28.51% | ||||||||
Federal tax rate | 21% | ||||||||
IL tax rate | 7.51% | ||||||||
State rate net of federal benefit | 9.50% | ||||||||
Deferred tax benefit | $ 994,000 | 669,000 | 474,000 | ||||||
Valuation allowance | 994,000 | ||||||||
Hotel | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Operating loss | 2,345,000 | $ 1,661,000 | |||||||
Projected estimated taxable income | 608,000 | ||||||||
Advisor | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Maximum percentage of gross proceeds from issuance of initial public offering | 15% | ||||||||
Class P Common Stock | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Shares issued excluding issuance cost price per share | $ / shares | $ 25 | ||||||||
Shares issued, price per share | $ / shares | $ 27.38 | ||||||||
Commercial Mortgage Loans | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Real estate securities at fair value | $ 0 | $ 0 | $ 0 | ||||||
Maximum | Buildings and Improvements | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
REO assets estimated useful lives | 40 years | ||||||||
Maximum | Furniture, Fixtures and Equipment | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
REO assets estimated useful lives | 15 years | ||||||||
Maximum | Commercial Mortgage Loans | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Risk rating to loan loss | Rating | 5 | ||||||||
Minimum | Commercial Mortgage Loans | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Risk rating to loan loss | Rating | 1 | ||||||||
Subsequent Event | ASU 2016-13 | Maximum | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Allowance for loan losses | $ 7,000,000 | ||||||||
Subsequent Event | ASU 2016-13 | Minimum | |||||||||
Summary Of Significant Accounting Policies Disclosures [Line Items] | |||||||||
Allowance for loan losses | $ 5,000,000 | ||||||||
[1] Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans |
Commercial Mortgage Loans Hel_3
Commercial Mortgage Loans Held for Investment - Summary of Commercial Mortgage Loans held for Investment (Details) $ in Thousands | 12 Months Ended | ||||
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2021 USD ($) Loan | Dec. 31, 2020 USD ($) | Dec. 31, 2019 USD ($) | ||
Mortgage Loans On Real Estate [Line Items] | |||||
Number of Loans | Loan | 43 | 38 | |||
Principal Balance | $ 844,507 | [1] | $ 664,170 | ||
Unamortized (fees)/costs, net | 1,359 | 1,328 | |||
Allowance for loan losses | (3,588) | ||||
Carrying Value | $ 842,278 | [1] | $ 665,498 | $ 441,814 | $ 504,702 |
Weighted Average Coupon | 7.80% | 4.60% | |||
Weighted Average Years to Maturity | 1 year 4 months 24 days | 1 year 8 months 12 days | |||
First Mortgage Loans [Member] | |||||
Mortgage Loans On Real Estate [Line Items] | |||||
Number of Loans | Loan | 41 | 36 | |||
Principal Balance | $ 831,007 | $ 650,670 | |||
Unamortized (fees)/costs, net | 1,359 | 1,328 | |||
Allowance for loan losses | (3,588) | ||||
Carrying Value | $ 828,778 | $ 651,998 | |||
Weighted Average Coupon | 7.70% | 4.50% | |||
Weighted Average Years to Maturity | 1 year 4 months 24 days | 1 year 7 months 6 days | |||
Credit Loans [Member] | |||||
Mortgage Loans On Real Estate [Line Items] | |||||
Number of Loans | Loan | 2 | 2 | |||
Principal Balance | $ 13,500 | $ 13,500 | |||
Carrying Value | $ 13,500 | $ 13,500 | |||
Weighted Average Coupon | 9.60% | 9.60% | |||
Weighted Average Years to Maturity | 3 years 4 months 24 days | 4 years 4 months 24 days | |||
[1] Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans |
Commercial Mortgage Loans Hel_4
Commercial Mortgage Loans Held for Investment - Schedule of Commercial Mortgage Loans held for Investment Portfolio (Details) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Mortgage Loans On Real Estate [Abstract] | ||||
Balance at Beginning of Year | $ 665,498 | $ 441,814 | $ 504,702 | |
Loan originations | 300,576 | 337,033 | 69,135 | |
Principal repayments | (120,240) | (114,558) | (99,727) | |
Amortization of loan origination and deferred exit fees | 616 | 1,440 | 1,818 | |
Origination fees and extension fees received on commercial loans | (584) | (231) | ||
Provision for loan losses | (3,588) | 0 | (4,726) | |
Balance at End of Period | $ 842,278 | [1] | $ 665,498 | $ 441,814 |
[1] Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans |
Commercial Mortgage Loans Hel_5
Commercial Mortgage Loans Held for Investment - Additional Information (Details) $ in Thousands | 1 Months Ended | 12 Months Ended | ||
May 31, 2020 USD ($) Loan | Dec. 31, 2022 USD ($) Loan Rating | Dec. 31, 2021 USD ($) Loan Rating | Dec. 31, 2020 USD ($) | |
Mortgage Loans On Real Estate [Line Items] | ||||
Commercial mortgage loans sold amount | $ 10,000 | $ 0 | $ 0 | $ 10,000 |
Proceeds from sale of mortgage loans held for investment | $ 9,625 | |||
Realized loss on sale of commercial loan | 375 | |||
Allowance for loan loss | $ 3,588 | $ 0 | ||
Interest income for impaired loans | 465 | |||
Initial risk rating for commercial mortgage loans held for investment and real estate securities | Rating | 2 | 2 | ||
Number of loans risk rated two | Loan | 33 | 33 | ||
Number of loans risk rated three | Loan | 8 | 5 | ||
Number of loans risk rated four | Loan | 1 | |||
Number of loans risk rated five | Loan | 1 | |||
Credit Loans [Member] | ||||
Mortgage Loans On Real Estate [Line Items] | ||||
Number of loans sold | Loan | 1 | |||
First Mortgage Loans [Member] | ||||
Mortgage Loans On Real Estate [Line Items] | ||||
Allowance for loan loss | $ 3,588 | |||
First Mortgage Loans [Member] | Office Building [Member] | ||||
Mortgage Loans On Real Estate [Line Items] | ||||
Impairment charges on loans | $ 3,588 | |||
First Mortgage Loans [Member] | Illinois [Member] | Office Building [Member] | ||||
Mortgage Loans On Real Estate [Line Items] | ||||
Impairment charges on loans | $ 4,726 |
Commercial Mortgage Loans Hel_6
Commercial Mortgage Loans Held for Investment - Summary of Allowance for Loans Losses (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Mortgage Loans On Real Estate [Abstract] | |||
Provision for loan losses | $ (3,588) | $ 0 | $ (4,726) |
Ending allowance for loan losses | $ (3,588) |
Commercial Mortgage Loans Hel_7
Commercial Mortgage Loans Held for Investment - Summary of Investment Grade of Loans Loss (Details) - Commercial Mortgage Loans | 12 Months Ended |
Dec. 31, 2022 | |
Investment Grade One | |
Financing Receivable Recorded Investment [Line Items] | |
Description of Investment Grade | Investment exceeding fundamental performance expectations and/or capital gain expected. Trends and risk factors since time of investment are favorable. |
Investment Grade Two | |
Financing Receivable Recorded Investment [Line Items] | |
Description of Investment Grade | Performing consistent with expectations and a full return of principal and interest expected. Trends and risk factors are neutral to favorable. |
Investment Grade Three | |
Financing Receivable Recorded Investment [Line Items] | |
Description of Investment Grade | Performing investment requiring closer monitoring. Trends and risk factors show some deterioration. Collection of principal and interest is still expected. |
Investment Grade Four | |
Financing Receivable Recorded Investment [Line Items] | |
Description of Investment Grade | Underperforming investment with the potential of some interest loss but still expecting a positive return on investment. Trends and risk factors are negative. |
Investment Grade Five | |
Financing Receivable Recorded Investment [Line Items] | |
Description of Investment Grade | Underperforming investment with expected loss of interest and some principal. |
Real Estate Securities - Additi
Real Estate Securities - Additional Information (Details) - USD ($) | 12 Months Ended | ||
Dec. 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | |
Schedule Of Available For Sale Securities [Line Items] | |||
Carrying value of investments | $ 0 | $ 0 | |
Real estate securities sold | $ 121,189,000 | ||
Commercial Mortgage Loans | |||
Schedule Of Available For Sale Securities [Line Items] | |||
Carrying value of investments | $ 0 | $ 0 | |
Real estate securities sold | 121,189,000 | ||
Realized loss | $ 35,020,000 |
Repurchase Agreements and Cre_3
Repurchase Agreements and Credit Facilities - Additional Information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | 32 Months Ended | |||||
Mar. 09, 2023 | Mar. 10, 2021 | May 31, 2022 | Dec. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2022 | Sep. 30, 2022 | May 06, 2019 | |
CF Repo Facility | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Repurchase agreement, maximum advance amount | $ 375,000,000 | |||||||
CF Repo Facility | Secured Overnight Financing Rate (SOFR) | Minimum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Interest rate spread | 2.50% | |||||||
Floor rate | 0.15% | |||||||
CF Repo Facility | Secured Overnight Financing Rate (SOFR) | Maximum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Interest rate spread | 3% | |||||||
Floor rate | 0.25% | |||||||
JP Morgan Repo Facility | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Repurchase agreement, maximum advance amount | $ 150,000,000 | |||||||
Credit facility advance percentage | 48.80% | |||||||
Maturity date | May 06, 2023 | |||||||
Preferred dividends plus interest expense | 150% | |||||||
EBITDA to Fixed Charges ratio | 135% | 144% | ||||||
JP Morgan Repo Facility | Minimum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Interest rate spread | 1.85% | |||||||
Floor rate | 0% | |||||||
JP Morgan Repo Facility | Maximum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Interest rate spread | 2.85% | |||||||
Floor rate | 2% | |||||||
JP Morgan Repo Facility | London Interbank Offered Rate | Minimum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Interest rate spread | 1.75% | |||||||
JP Morgan Repo Facility | London Interbank Offered Rate | Maximum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Interest rate spread | 2.50% | |||||||
Western Alliance Credit Facility | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Repurchase agreement, maximum advance amount | $ 75,000,000 | |||||||
Maturity date | Mar. 10, 2023 | |||||||
Borrowing base period for eligible pledged assets become ineligible | 36 months | |||||||
Convertible by option term loan initial maturity period | 2 years | |||||||
Percentage of conversion fee of convertible by option term loan. | 0.25% | |||||||
Minimum average unrestricted aggregate deposit balance amount to be maintained | $ 3,750,000 | |||||||
Increased interest rate due to failure to meet the minimum deposit balance | 0.25% | |||||||
Western Alliance Credit Facility | Subsequent Event | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Repurchase agreement, maximum advance amount | $ 40,000,000 | |||||||
Maturity date | Mar. 10, 2025 | |||||||
Western Alliance Credit Facility | Minimum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Loan-to-unpaid balance percentage | 60% | |||||||
Loan-to-appraised value percentage | 45% | |||||||
Western Alliance Credit Facility | Minimum | Subsequent Event | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Floor rate | 3.50% | |||||||
Western Alliance Credit Facility | Maximum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Loan-to-unpaid balance percentage | 70% | |||||||
Loan-to-appraised value percentage | 50% | |||||||
Western Alliance Credit Facility | Maximum | Subsequent Event | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Floor rate | 6% | |||||||
Western Alliance Credit Facility | London Interbank Offered Rate | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Interest rate spread | 3.25% | |||||||
Floor rate | 0.75% |
Repurchase Agreements and Cre_4
Repurchase Agreements and Credit Facilities - Schedule of Outstanding Repurchase Agreements (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Repurchase Agreements And Credit Facility [Line Items] | ||
Accrued Interest Payable | $ 1,499 | $ 364 |
CF Repo Facility | Commercial Mortgage Loans | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Committed Financing | 375,000 | 350,000 |
Amount Outstanding | 356,094 | 189,654 |
Accrued Interest Payable | $ 882 | $ 159 |
Weighted Average Interest Rate | 6.89% | 2.16% |
Weighted Average Days to Maturity | 679 days | 314 days |
CF Repo Facility | Commercial Mortgage Loans | Collateral Pledged | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Collateral Pledged | $ 494,962 | $ 260,691 |
JPM Repo Facility | Commercial Mortgage Loans | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Committed Financing | 150,000 | 150,000 |
Amount Outstanding | 131,992 | 117,470 |
Accrued Interest Payable | $ 305 | $ 92 |
Weighted Average Interest Rate | 6.40% | 2.02% |
Weighted Average Days to Maturity | 492 days | 126 days |
JPM Repo Facility | Commercial Mortgage Loans | Collateral Pledged | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Collateral Pledged | $ 181,972 | $ 167,704 |
Repo Facility | Commercial Mortgage Loans | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Committed Financing | 525,000 | 500,000 |
Amount Outstanding | 488,086 | 307,124 |
Accrued Interest Payable | $ 1,187 | $ 251 |
Weighted Average Interest Rate | 6.76% | 2.11% |
Weighted Average Days to Maturity | 628 days | 242 days |
Repo Facility | Commercial Mortgage Loans | Collateral Pledged | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Collateral Pledged | $ 676,934 | $ 428,395 |
Western Alliance Credit Facility | Commercial Mortgage Loans | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Committed Financing | 75,000 | 75,000 |
Amount Outstanding | 18,380 | 14,350 |
Accrued Interest Payable | $ 16 | $ 22 |
Weighted Average Interest Rate | 7.64% | 4% |
Weighted Average Days to Maturity | 435 days | 434 days |
Western Alliance Credit Facility | Commercial Mortgage Loans | Collateral Pledged | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Collateral Pledged | $ 29,797 | $ 20,500 |
Facilities | Commercial Mortgage Loans | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Committed Financing | 600,000 | 575,000 |
Amount Outstanding | 506,466 | 321,474 |
Accrued Interest Payable | $ 1,203 | $ 273 |
Weighted Average Interest Rate | 6.79% | 2.19% |
Weighted Average Days to Maturity | 621 days | 251 days |
Facilities | Commercial Mortgage Loans | Collateral Pledged | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Collateral Pledged | $ 706,731 | $ 448,895 |
Repurchase Agreements and Cre_5
Repurchase Agreements and Credit Facilities - Schedule of Outstanding Repurchase Agreements (Parenthetical) (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Repo Facility | ||
Repurchase Agreements And Credit Facility [Line Items] | ||
Unamortized Debt Issuance Expense | $ 3 | $ 41 |
Loan Participations Sold, Net -
Loan Participations Sold, Net - Additional Information (Details) | Nov. 15, 2021 Loan |
First Mortgage Loans [Member] | |
Mortgage Loans On Real Estate [Line Items] | |
Number of loans sold to third party | 9 |
Loan Participations Sold, Net_2
Loan Participations Sold, Net - Summary of Loan Participations Sold (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 USD ($) Loan | Dec. 31, 2021 USD ($) Loan | |
Mortgage Loans On Real Estate [Line Items] | ||
Weighted Average Interest Rate | 7.80% | 4.60% |
Weighted Average Years to Maturity | 1 year 4 months 24 days | 1 year 8 months 12 days |
Loan Participations | ||
Mortgage Loans On Real Estate [Line Items] | ||
Number of loans sold to third party | Loan | 7 | 9 |
Principal Balance | $ 124,275 | $ 137,215 |
Book Value | $ 121,431 | $ 137,931 |
Weighted Average Interest Rate | 3.70% | 3.60% |
Weighted Average Years to Maturity | 1 year 2 months 19 days | 2 years 2 months 19 days |
Senior Loan Participations | ||
Mortgage Loans On Real Estate [Line Items] | ||
Number of loans sold to third party | Loan | 7 | 9 |
Principal Balance | $ 99,420 | $ 109,772 |
Book Value | $ 99,420 | $ 109,772 |
Weighted Average Interest Rate | 2% | 2% |
Weighted Average Years to Maturity | 1 year 2 months 19 days | 2 years 2 months 19 days |
Loan Participations Sold, Net_3
Loan Participations Sold, Net - Summary of Loan Participations Sold (Parenthetical) (Details) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2022 | Dec. 31, 2021 | |
Loan Participations | ||
Mortgage Loans On Real Estate [Line Items] | ||
Interest expense on loan sold | $ 3,952 | $ 281 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 7 Months Ended | 12 Months Ended | |||||||||||||||||||||||||||||||||||||||||||
Dec. 30, 2022 | Mar. 30, 2022 | Oct. 15, 2021 | Oct. 01, 2021 | Sep. 22, 2021 | Jul. 31, 2020 | May 03, 2019 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | Dec. 30, 2021 | Feb. 29, 2020 | Jul. 31, 2019 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2018 | Dec. 31, 2017 | Aug. 11, 2022 | Dec. 31, 2019 | |
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock, change of control, terms of conversion | Subject to certain exceptions, beginning on September 22, 2022, upon the occurrence of a Change of Control, each holder of shares of Series A Preferred Stock will have the right to convert some or all of the Series A Preferred Stock held by such holder into a number of the Company’s shares of Class I common stock as provided for in the Articles Supplementary. | ||||||||||||||||||||||||||||||||||||||||||||||
Common stock, offering costs | $ 1,680,000 | $ 4,655,000 | $ 1,844,000 | ||||||||||||||||||||||||||||||||||||||||||||
Dividends payable record date | Jul. 31, 2020 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | ||||||||||||||||
Distributions payable | $ 1,047,000 | $ 1,137,000 | 1,047,000 | 1,137,000 | |||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | 4,529,000 | 199,000 | 24,269,000 | ||||||||||||||||||||||||||||||||||||||||||||
Repurchased of common stock | $ 22,367,000 | $ 14,335,000 | $ 763,000 | ||||||||||||||||||||||||||||||||||||||||||||
Repurchased of common stock average price per share | $ 19.70 | $ 20.19 | $ 25 | ||||||||||||||||||||||||||||||||||||||||||||
Share repurchase program, shares authorized to be repurchased | 0 | ||||||||||||||||||||||||||||||||||||||||||||||
Gain on repurchase and retirement of preferred stock | $ 306,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Maximum | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Aggregate net asset value of shares repurchased per month | 2% | ||||||||||||||||||||||||||||||||||||||||||||||
Aggregate net asset value of shares repurchased per quarter | 5% | ||||||||||||||||||||||||||||||||||||||||||||||
Share Repurchase Program | Maximum | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Percentage of aggregate net asset value per month | 2% | ||||||||||||||||||||||||||||||||||||||||||||||
Percentage of aggregate net asset value per quarter | 5% | ||||||||||||||||||||||||||||||||||||||||||||||
Series A Preferred Repurchase Program | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Share repurchase program, shares authorized to be repurchased | 948,696 | 948,696 | 1,000,000 | ||||||||||||||||||||||||||||||||||||||||||||
Share repurchase program, authorized amount | $ 15,000,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Shares repurchased and retired | 51,304 | ||||||||||||||||||||||||||||||||||||||||||||||
Gain on repurchase and retirement of preferred stock | $ 306,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Stock Repurchase Program, Remaining Authorized Repurchase Amount | $ 14,076,000 | $ 14,076,000 | |||||||||||||||||||||||||||||||||||||||||||||
Series A Preferred Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Liquidation preference per share | $ 25 | $ 25 | |||||||||||||||||||||||||||||||||||||||||||||
Preferred stock, redemption date | Sep. 22, 2026 | ||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock, redemption price per share | $ 25 | ||||||||||||||||||||||||||||||||||||||||||||||
Percentage of dividend rate | 6.75% | ||||||||||||||||||||||||||||||||||||||||||||||
Annual dividend per share | $ 1.6875 | ||||||||||||||||||||||||||||||||||||||||||||||
Dividend paid pro rate | $ 0.421875 | $ 0.421875 | $ 0.421875 | $ 0.421875 | $ 0.459375 | ||||||||||||||||||||||||||||||||||||||||||
Shares repurchased and retired | 51,304 | ||||||||||||||||||||||||||||||||||||||||||||||
Class P Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Daily distribution amount | $ 0.005260274 | $ 0.005260274 | $ 0.005260274 | ||||||||||||||||||||||||||||||||||||||||||||
Annualized gross distribution per share | $ 1.92 | $ 1.92 | $ 1.92 | $ 1.92 | |||||||||||||||||||||||||||||||||||||||||||
Gross monthly distribution amount | 0.16 | ||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares, outstanding | 8,562,777 | 9,492,939 | 10,151,787 | 8,562,777 | 9,492,939 | 10,151,787 | 10,182,305 | ||||||||||||||||||||||||||||||||||||||||
Distributions declared | $ 11,245,000 | $ 11,577,000 | $ 7,768,000 | ||||||||||||||||||||||||||||||||||||||||||||
Class A Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Annualized gross distribution per share | 1.62 | ||||||||||||||||||||||||||||||||||||||||||||||
Gross monthly distribution amount | 0.135 | ||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares, outstanding | 743,183 | 659,270 | 655,835 | 743,183 | 659,270 | 655,835 | 272,006 | ||||||||||||||||||||||||||||||||||||||||
Distributions declared | $ 869,000 | $ 767,000 | $ 419,000 | ||||||||||||||||||||||||||||||||||||||||||||
Class T Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Annualized gross distribution per share | 1.62 | ||||||||||||||||||||||||||||||||||||||||||||||
Gross monthly distribution amount | 0.135 | ||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares, outstanding | 286,341 | 388,099 | 398,233 | 286,341 | 388,099 | 398,233 | 121,718 | ||||||||||||||||||||||||||||||||||||||||
Distributions declared | $ 416,000 | $ 395,000 | $ 213,000 | ||||||||||||||||||||||||||||||||||||||||||||
Class D Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Annualized gross distribution per share | 1.62 | ||||||||||||||||||||||||||||||||||||||||||||||
Gross monthly distribution amount | 0.135 | ||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares, outstanding | 47,888 | 47,298 | 50,393 | 47,888 | 47,298 | 50,393 | 41,538 | ||||||||||||||||||||||||||||||||||||||||
Distributions declared | $ 57,000 | $ 54,000 | $ 33,000 | ||||||||||||||||||||||||||||||||||||||||||||
Class I Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Annualized gross distribution per share | 1.62 | ||||||||||||||||||||||||||||||||||||||||||||||
Gross monthly distribution amount | $ 0.135 | ||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares, outstanding | 452,667 | 380,218 | 381,955 | 452,667 | 380,218 | 381,955 | 100,743 | ||||||||||||||||||||||||||||||||||||||||
Distributions declared | $ 495,000 | $ 448,000 | $ 229,000 | ||||||||||||||||||||||||||||||||||||||||||||
Class S Common Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Common stock, shares, outstanding | 0 | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||||||||||
Preferred Stock Offering | Series A Preferred Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Preferred stock, shares issued | 3,500,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Offered price | $ 25 | ||||||||||||||||||||||||||||||||||||||||||||||
Option to purchase additional shares for underwriters, number of days | 30 days | ||||||||||||||||||||||||||||||||||||||||||||||
Net proceeds after underwriter's discount and issuance costs | $ 86,310,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Percentage of cumulative redeemable preferred stock | 6.75% | ||||||||||||||||||||||||||||||||||||||||||||||
Liquidation preference per share | $ 25 | ||||||||||||||||||||||||||||||||||||||||||||||
Over-Allotment | Series A Preferred Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Additional shares authorized to cover over-allotments | 525,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Over-Allotment | Series A Preferred Stock | Raymond James & Associates, Inc. | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Additional shares issued to cover over-allotments | 100,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Public Offerings | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Common stock issued, average price per share | $ 20.31 | $ 20.42 | $ 25.83 | $ 20.31 | $ 20.42 | $ 25.83 | |||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock, net of offering costs | $ 3,722,000 | $ (110,000) | $ 22,267,000 | ||||||||||||||||||||||||||||||||||||||||||||
Common stock, offering costs | 1,532,000 | 892,000 | 2,246,000 | ||||||||||||||||||||||||||||||||||||||||||||
Reimbursable deferred offering costs | $ 26,000 | $ 70,000 | $ 26,000 | $ 70,000 | |||||||||||||||||||||||||||||||||||||||||||
Public Offerings | Series A Preferred Stock | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Common stock issued, average price per share | $ 25 | $ 25 | |||||||||||||||||||||||||||||||||||||||||||||
Common stock, offering costs | $ 3,693,000 | ||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | 86,307,000 | ||||||||||||||||||||||||||||||||||||||||||||||
DRP | |||||||||||||||||||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||
Proceeds from issuance of common stock | $ 724,000 | $ 583,000 | |||||||||||||||||||||||||||||||||||||||||||||
Average price per share | $ 19.73 | $ 20.22 | $ 19.73 | $ 20.22 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Change in Outstanding Shares Including Restricted Common Stock (Details) - shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Series A Preferred Stock | |||
Class Of Stock [Line Items] | |||
Issuance of shares | 3,600,000 | ||
Beginning balance | 3,600,000 | ||
Repurchase and retirement of preferred stock | (51,304) | ||
Ending balance | 3,548,696 | 3,600,000 | |
Class P Common Stock | |||
Class Of Stock [Line Items] | |||
Beginning balance | 9,492,939 | 10,151,787 | 10,182,305 |
Redemptions | (930,162) | (658,848) | (30,518) |
Ending balance | 8,562,777 | 9,492,939 | 10,151,787 |
Class A Common Stock | |||
Class Of Stock [Line Items] | |||
Beginning balance | 659,270 | 655,835 | 272,006 |
Issuance of shares | 107,721 | 4,801 | 379,250 |
Distribution reinvestment | 12,662 | 10,992 | 4,579 |
Redemptions | (36,470) | (12,358) | |
Ending balance | 743,183 | 659,270 | 655,835 |
Class T Common Stock | |||
Class Of Stock [Line Items] | |||
Beginning balance | 388,099 | 398,233 | 121,718 |
Issuance of shares | 46,977 | 3,673 | 274,570 |
Distribution reinvestment | 6,307 | 5,687 | 1,945 |
Redemptions | (155,042) | (19,494) | |
Ending balance | 286,341 | 388,099 | 398,233 |
Class D Common Stock | |||
Class Of Stock [Line Items] | |||
Beginning balance | 47,298 | 50,393 | 41,538 |
Issuance of shares | 8,066 | ||
Distribution reinvestment | 1,548 | 1,748 | 789 |
Redemptions | (958) | (4,843) | |
Ending balance | 47,888 | 47,298 | 50,393 |
Class I Common Stock | |||
Class Of Stock [Line Items] | |||
Beginning balance | 380,218 | 381,955 | 100,743 |
Issuance of shares | 67,316 | 976 | 276,618 |
Distribution reinvestment | 16,212 | 10,420 | 3,201 |
Issuance of restricted shares | 1,534 | 1,477 | 1,393 |
Redemptions | (12,613) | (14,610) | |
Ending balance | 452,667 | 380,218 | 381,955 |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of Aggregate Annualized and Monthly Distributions Declared by Record Date for all Classes of Shares (Details) - $ / shares | 1 Months Ended | ||||||||||||||||||||||||||||||
Jul. 31, 2020 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | |
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||
Record date | Jul. 31, 2020 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 |
Aggregate Annualized Gross Dividend Declared of Common Stock | |||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||
Aggregate gross distribution declared per share of common stock | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.2500 | $ 1.1500 | $ 1.1000 | $ 1.0500 | $ 1 | $ 0.9500 | $ 0.9000 | $ 0.9000 | $ 0.9000 | $ 0.9000 | $ 0.8800 | $ 0.8576 | |
Aggregate Monthly Gross Dividend Declared of Common Stock | |||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||
Aggregate gross distribution declared per share of common stock | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.1042 | $ 0.0958 | $ 0.0917 | $ 0.0875 | $ 0.0833 | $ 0.0792 | $ 0.0750 | $ 0.0750 | $ 0.0750 | $ 0.0750 | $ 0.0733 | $ 0.0715 |
Stockholders' Equity - Schedu_3
Stockholders' Equity - Schedule of Monthly Net Distributions Per Share (Details) - $ / shares | 1 Months Ended | ||||||||||||||||||||||||||||||
Jul. 31, 2020 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | |
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||
Record date | Jul. 31, 2020 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 |
Monthly Net Distribution Declared of Class D Common Stock | |||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||
Net distributions declared per share | $ 0.1000 | $ 0.1002 | $ 0.1000 | $ 0.1001 | $ 0.1000 | $ 0.1000 | $ 0.1001 | $ 0.1000 | $ 0.1001 | $ 0.0999 | $ 0.1003 | $ 0.0999 | $ 0.0999 | $ 0.1000 | $ 0.0999 | $ 0.1000 | $ 0.0999 | $ 0.0999 | $ 0.1000 | $ 0.0915 | $ 0.0876 | $ 0.0832 | $ 0.0794 | $ 0.0749 | $ 0.0704 | $ 0.0706 | $ 0.0704 | $ 0.0706 | $ 0.0688 | $ 0.0670 | |
Monthly Net Distribution Declared of Class T Common Stock | |||||||||||||||||||||||||||||||
Class Of Stock [Line Items] | |||||||||||||||||||||||||||||||
Net distributions declared per share | $ 0.0900 | $ 0.0905 | $ 0.0900 | $ 0.0905 | $ 0.0900 | $ 0.0899 | $ 0.0904 | $ 0.0899 | $ 0.0903 | $ 0.0898 | $ 0.0910 | $ 0.0896 | $ 0.0897 | $ 0.0901 | $ 0.0895 | $ 0.0900 | $ 0.0895 | $ 0.0896 | $ 0.0900 | $ 0.0813 | $ 0.0776 | $ 0.0729 | $ 0.0701 | $ 0.0646 | $ 0.0595 | $ 0.0600 | $ 0.0594 | $ 0.0600 | $ 0.0578 | $ 0.0560 |
Stockholders' Equity - Schedu_4
Stockholders' Equity - Schedule of Aggregate Distributions Declared for Applicable Class of Common Stock (Details) - $ / shares | 12 Months Ended | |||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Series A Preferred Stock | ||||
Distributions Declared [Line Items] | ||||
Aggregate annualized gross distribution declared per share of common stock | $ 1.6875 | $ 0.4594 | [1] | |
Net distributions declared per share | 1.6875 | 0.4594 | [1] | |
Class P Common Stock | ||||
Distributions Declared [Line Items] | ||||
Aggregate annualized gross distribution declared per share of common stock | 1.2504 | 1.1669 | $ 0.7648 | |
Net distributions declared per share | 1.2504 | 1.1669 | 0.7648 | |
Class A Common Stock | ||||
Distributions Declared [Line Items] | ||||
Aggregate annualized gross distribution declared per share of common stock | 1.2504 | 1.1669 | 0.7148 | |
Net distributions declared per share | 1.2504 | 1.1669 | 0.7148 | |
Class T Common Stock | ||||
Distributions Declared [Line Items] | ||||
Aggregate annualized gross distribution declared per share of common stock | 1.2504 | 1.1669 | 0.7148 | |
Stockholder servicing fee per share | 0.1685 | 0.1720 | 0.1270 | |
Net distributions declared per share | 1.0819 | 0.9949 | 0.5878 | |
Class D Common Stock | ||||
Distributions Declared [Line Items] | ||||
Aggregate annualized gross distribution declared per share of common stock | 1.2504 | 1.1669 | 0.7148 | |
Stockholder servicing fee per share | 0.0498 | 0.0507 | 0.0373 | |
Net distributions declared per share | 1.2006 | 1.1162 | 0.6775 | |
Class I Common Stock | ||||
Distributions Declared [Line Items] | ||||
Aggregate annualized gross distribution declared per share of common stock | 1.2504 | 1.1669 | 0.7148 | |
Net distributions declared per share | $ 1.2504 | $ 1.1669 | $ 0.7148 | |
[1] Distributions on preferred stock are only for a partial year following their issuance on September 22, 2021. |
Net Income Per Share Attribut_3
Net Income Per Share Attributable to Common Stockholders - Additional information (Details) - Restricted Shares - shares | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share Diluted [Line Items] | |||
Additional shares included in computation of diluted earnings per share | 830 | 947 | 0 |
Antidilutive restricted shares | 645 | 610 | 583 |
Net Income Per Share Attribut_4
Net Income Per Share Attributable to Common Stockholders - Summary of Basic and Diluted Net (Loss) Income Per Share Attributable to Common Stockholders (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings Per Share [Abstract] | |||
Net income (loss) attributable to common stockholders | $ 4,430 | $ 8,219 | $ (28,784) |
Weighted average shares outstanding, basic | 10,605,242 | 11,480,517 | 11,561,828 |
Weighted average shares outstanding, diluted | 10,606,072 | 11,481,464 | 11,561,828 |
Net income (loss) per share attributable to common stockholders, basic | $ 0.42 | $ 0.72 | $ (2.49) |
Net income (loss) per share attributable to common stockholders, diluted | $ 0.42 | $ 0.72 | $ (2.49) |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | Dec. 31, 2022 USD ($) Loan | Dec. 31, 2021 USD ($) Loan |
Commitments And Contingencies Disclosure [Abstract] | ||
Number of commercial real estate loans with remaining future funding commitment | Loan | 33 | 33 |
Commercial real estate, remaining future funding commitment | $ | $ 59,474 | $ 74,518 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) - Segment | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Segment Reporting [Abstract] | |||
Number of reportable segment | 1 | 1 | 1 |
Transactions with Related Par_3
Transactions with Related Parties - Additional Information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | ||||
Jul. 20, 2021 | Jul. 15, 2021 | Nov. 30, 2016 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | ||||||
Proceeds from issuance of common stock | $ 4,529,000 | $ 199,000 | $ 24,269,000 | |||
Expense Limitation Agreement | ||||||
Related Party Transaction [Line Items] | ||||||
Annualized ordinary operating expenses of quarter to extent expenses do not exceed average monthly net assets percentage | 1.50% | |||||
Annualized basis expense limit percentage | 1.50% | |||||
Reimbursement of expenses payable term | 3 years | |||||
Waive reimbursement on quarterly basis terms | waive reimbursement of or pay, on a quarterly basis, certain of the Company’s ordinary operating expenses for each class of shares to the extent necessary to ensure that the ordinary operating expenses do not exceed 1.5% of the average monthly net assets on an annualized basis (the “1.5% Expense Limit”). Amounts waived or paid by the Advisor or Sub-Advisor pursuant to the Expense Limitation Agreement are subject to conditional repayment on a quarterly basis by the Company during the three years following the quarter in which the expenses were incurred, but only to the extent such repayment does not cause the Company to exceed its then-current expenses limitation, if any, for such quarter. Any waiver or reimbursement by the Advisor or Sub-Advisor not repaid by the Company within the three-year period will be deemed permanently waived and not subject to repayment under the Expense Limitation Agreement. During the year ended December 31, 2022, the amount of ordinary operating expenses either submitted for reimbursement by the Advisor and Sub-Advisor or incurred by the Company directly that was subject to the Expense Limitation Agreement did not exceed the 1.5% Expense Limit. | |||||
Expense Limitation Agreement | Maximum | ||||||
Related Party Transaction [Line Items] | ||||||
Reimbursement of expenses payable term | 3 years | |||||
Class P Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Common stock, shares, issued | 8,562,777 | 9,492,939 | ||||
Advisor | Class P Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Proceeds from issuance of common stock | $ 1,000,000 | |||||
Common stock, shares, issued | 40,040 | |||||
Payment of selling commissions | $ 0 | |||||
Payment of dealer manager fees | 0 | |||||
Payment of organization and offering expenses | 0 | |||||
Subscription agreement, minimum number of shares to be held | 8,000 | |||||
Subscription agreement, value of minimum number of shares to be held | $ 200,000 | |||||
Description of subscription agreement | The Advisor has agreed pursuant to its subscription agreement that, for so long as it or its affiliate is serving as the Advisor, (i) it will not sell or transfer at least 8,000 of the Class P Shares that it has purchased, accounting for $200 of its investment, to an unaffiliated third party; (ii) it will not be eligible to submit a request for these 40,040 Class P Shares pursuant to the Company’s SRP prior to the fifth anniversary of the date on which such shares were purchased (November 2021); and (iii) repurchase requests made for these Class P Shares will only be accepted (a) on the last business day of a calendar quarter, (b) after all repurchase requests from all other stockholders for such quarter have been accepted and (c) to the extent that such repurchases do not cause total repurchases in the quarter in which they are being repurchased to exceed that quarter’s repurchase cap | |||||
Sub-Advisor | Class P Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Proceeds from issuance of common stock | $ 3,000,000 | |||||
Common stock, shares, issued | 120,000 | |||||
Payment of selling commissions | $ 0 | |||||
Payment of dealer manager fees | 0 | |||||
Payment of organization and offering expenses | $ 0 | |||||
Description of subscription agreement | Sound Point has agreed pursuant to its subscription agreement that, for so long as the Sub-Advisor or its affiliate is serving as the Sub-Advisor, (i) it will not be eligible to submit a request for the repurchase of these 120,000 shares pursuant to the Company’s SRP prior to the fifth anniversary of the date on which such shares were purchased (November 2021); and (ii) repurchase requests made for these shares will only be accepted (a) on the last business day of a calendar quarter, (b) after all repurchase requests from all other stockholders for such quarter have been accepted and (c) to the extent that such repurchases do not cause total repurchases in the quarter in which they are being repurchased to exceed that quarter’s repurchase cap. | |||||
Inland Real Estate Investment Corporation | Revolving Credit Liquidity Letter Agreements | ||||||
Related Party Transaction [Line Items] | ||||||
Number of days notice of termination prior to maturity date of agreement | 60 days | |||||
Fixed interest rate | 6% | |||||
Inland Real Estate Investment Corporation | Revolving Credit Liquidity Letter Agreements | Maximum | ||||||
Related Party Transaction [Line Items] | ||||||
Aggregate principal amount outstanding | $ 5,000,000 | |||||
Inland Real Estate Investment Corporation | Revolving Credit Liquidity Letter Agreements | Minimum [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Stockholders equity balance to trigger termination of liquidity letter agreements | $ 500,000,000 | |||||
Sound Point | Revolving Credit Liquidity Letter Agreements | ||||||
Related Party Transaction [Line Items] | ||||||
Number of days notice of termination prior to maturity date of agreement | 60 days | |||||
Fixed interest rate | 6% | |||||
Sound Point | Revolving Credit Liquidity Letter Agreements | Maximum | ||||||
Related Party Transaction [Line Items] | ||||||
Aggregate principal amount outstanding | $ 15,000,000 | |||||
Sound Point | Revolving Credit Liquidity Letter Agreements | Minimum [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Stockholders equity balance to trigger termination of liquidity letter agreements | $ 500,000,000 |
Transactions with Related Par_4
Transactions with Related Parties - Summary of Related Party Transactions (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Related Party Transaction [Line Items] | |||
Advisory fee | $ 3,692 | $ 3,217 | $ 5,528 |
Accrued stockholder servicing fee | (108) | (85) | 401 |
Total, payable | 2,197 | 2,894 | |
Advisor Sub Advisor And Dealer Manager | |||
Related Party Transaction [Line Items] | |||
Organization and offering expense reimbursement | 26 | 70 | |
Selling commissions and dealer manager fee | 155 | 8 | 758 |
Advisory fee | 3,692 | 3,217 | 5,528 |
Loan fees | 3,714 | 4,597 | 1,508 |
Accrued stockholder servicing fee | (59) | (23) | 446 |
Operating expense reimbursement to Advisor | 56 | 1 | |
Total | 7,502 | 7,881 | $ 8,311 |
Advisory fee, payable | 296 | 321 | |
Loan fees, payable | 1,419 | 1,983 | |
Accrued stockholder servicing fee, payable | 482 | 590 | |
Total, payable | $ 2,197 | $ 2,894 |
Transactions with Related Par_5
Transactions with Related Parties - Summary of Related Party Transactions (Parenthetical) (Details) - Advisor - USD ($) | 6 Months Ended | 12 Months Ended | 42 Months Ended | |||
Jul. 01, 2021 | Jun. 30, 2021 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2022 | |
Related Party Transaction [Line Items] | ||||||
Maximum percentage of gross proceeds from issuance of initial public offering | 15% | |||||
Percentage of excess total return | 20% | |||||
Net asset value | $ 25 | $ 25 | ||||
Net asset value description | if the NAV per share decreases below $25 for any class of shares during the measurement period, any subsequent increase in NAV per share to $25 (or such other adjusted number) will not be included in the calculation of the performance component with respect to that class. | |||||
Percentage of gross value of assets, paid monthly | 0.104% | |||||
Percentage of average net asset value of assets, paid monthly | 0.104% | |||||
Fixed component of advisory fee waived | $ 0 | $ 1,475,000 | $ 874,000 | |||
Performance component of advisory fee waived | $ 0 | |||||
Class D and Class I Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of upfront selling commission | 0% | |||||
Percentage of upfront dealer manager fee | 0% | |||||
Class T Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of stockholder servicing fees on net asset value | 0.85% | |||||
Class S Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Aggregate percentage of stockholder servicing fees on net asset value | 0.85% | |||||
Class D Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Aggregate percentage of stockholder servicing fees on net asset value | 0.25% | |||||
Public Offerings | Class T Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of upfront dealer manager fee | 0.50% | |||||
Maximum | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of aggregate total return | 15% | |||||
Percentage of net asset value of assets, paid monthly | 0.208% | |||||
Maximum | Public Offerings | Class A Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of upfront selling commission | 6% | |||||
Percentage of upfront dealer manager fee | 1.25% | |||||
Percentage of participation dealers fee | 7.25% | |||||
Maximum | Public Offerings | Class T Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of upfront selling commission | 3% | |||||
Percentage of participation dealers fee | 3.50% | |||||
Maximum | Public Offerings | Class S Common Stock | ||||||
Related Party Transaction [Line Items] | ||||||
Percentage of upfront selling commission | 3.50% | |||||
Minimum | ||||||
Related Party Transaction [Line Items] | ||||||
Minimum percentage to earn performance component of advisory fee | 7% |
Equity-Based Compensation - Add
Equity-Based Compensation - Additional Information (Details) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 USD ($) Director | Dec. 31, 2021 USD ($) | Dec. 31, 2020 USD ($) | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Number of independent directors | Director | 3 | ||
RSP | Restricted Shares | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Fair value of restricted shares at vesting date | $ 35 | ||
RSP | Restricted Shares | Independent Directors | |||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||
Vesting period | 3 years | ||
Compensation expense | $ 32 | $ 34 | $ 31 |
Unrecognized compensation cost | $ 54 | ||
Weighted average remaining period that compensation expense recognizable | 1 year 5 months 19 days |
Equity-Based Compensation - Sum
Equity-Based Compensation - Summary of Total Stock Grants (Details) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||||||||
Oct. 03, 2022 | Oct. 14, 2021 | Dec. 01, 2020 | Dec. 02, 2019 | Jan. 07, 2019 | Mar. 01, 2018 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Class I Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Total number of shares granted | 1,534 | 1,477 | 1,393 | ||||||
Restricted Shares | RSP | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Grant Date Fair Value Per Share | $ 19.55 | ||||||||
Restricted Shares | RSP | Class P Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Total number of shares granted | 1,200 | 1,200 | |||||||
Grant Date Fair Value Per Share | $ 25 | $ 25 | |||||||
Total Fair Value of Grant | $ 30 | $ 30 | |||||||
Proportion of total shares that vest annually | 33.33% | 33.33% | |||||||
Restricted Shares | RSP | Class I Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Total number of shares granted | 1,534 | 1,477 | 1,393 | 1,197 | |||||
Grant Date Fair Value Per Share | $ 19.55 | $ 20.31 | $ 21.54 | $ 25.07 | |||||
Total Fair Value of Grant | $ 30 | $ 30 | $ 30 | $ 30 | |||||
Proportion of total shares that vest annually | 33.33% | 33.33% | 33.33% | 33.33% | |||||
Year 1 | Restricted Shares | RSP | Class P Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Vesting Date | Jan. 07, 2020 | Mar. 01, 2019 | |||||||
Year 1 | Restricted Shares | RSP | Class I Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Vesting Date | Oct. 03, 2023 | Oct. 14, 2022 | Dec. 01, 2021 | Dec. 02, 2020 | |||||
Year 2 | Restricted Shares | RSP | Class P Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Vesting Date | Jan. 07, 2021 | Mar. 01, 2020 | |||||||
Year 2 | Restricted Shares | RSP | Class I Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Vesting Date | Oct. 03, 2024 | Oct. 14, 2023 | Dec. 01, 2022 | Dec. 02, 2021 | |||||
Year 3 | Restricted Shares | RSP | Class P Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Vesting Date | Jan. 07, 2022 | Mar. 01, 2021 | |||||||
Year 3 | Restricted Shares | RSP | Class I Common Stock | |||||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||||
Vesting Date | Oct. 03, 2025 | Oct. 14, 2024 | Dec. 01, 2023 | Dec. 02, 2022 |
Equity-Based Compensation - S_2
Equity-Based Compensation - Summary of the Restricted Shares Granted under RSP (Details) - Restricted Shares - RSP | 12 Months Ended |
Dec. 31, 2022 $ / shares shares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Outstanding beginning balance, Shares | shares | 3,205 |
Granted, Shares | shares | 1,534 |
Vested, Shares | shares | (1,756) |
Outstanding ending balance, Shares | shares | 2,983 |
Outstanding beginning balance, Weighted average grant date fair value per share | $ / shares | $ 21.85 |
Grant Date Fair Value Per Share | $ / shares | 19.55 |
Vested, Weighted average grant date fair value per share | $ / shares | 22.79 |
Outstanding ending balance, Weighted average grant date fair value per share | $ / shares | $ 20.11 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Schedule of Carrying Amount and Fair Value of Financial Instruments (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 |
Carrying Amount | ||
Financial assets | ||
Cash and cash equivalents | $ 29,408 | $ 57,268 |
Commercial mortgage loans, net | 842,278 | 665,498 |
Total | 871,686 | 722,766 |
Financial liabilities | ||
Credit facility payable | 18,380 | 14,350 |
Loan participations sold | 99,420 | 109,772 |
Total | 605,886 | 431,205 |
Carrying Amount | Commercial Mortgage Loans | ||
Financial liabilities | ||
Repurchase agreements | 488,086 | 307,083 |
Estimated Fair Value | ||
Financial assets | ||
Cash and cash equivalents | 29,408 | 57,268 |
Commercial mortgage loans, net | 842,278 | 667,405 |
Total | 871,686 | 724,673 |
Financial liabilities | ||
Credit facility payable | 18,380 | 14,350 |
Loan participations sold | 99,420 | 109,772 |
Total | 605,886 | 431,205 |
Estimated Fair Value | Commercial Mortgage Loans | ||
Financial liabilities | ||
Repurchase agreements | $ 488,086 | $ 307,083 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Additional Information (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Commercial Mortgage Loans | |
Fair Value Balance Sheet Grouping Financial Statement Captions [Line Items] | |
Loan term | 1 year 4 months 24 days |
Real Estate Owned - Schedule of
Real Estate Owned - Schedule of Company's REO Assets (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | ||
Real Estate [Line Items] | |||
Real Estate Owned, Net | $ 31,215 | $ 31,535 | |
Hotel | Chicago, IL | |||
Real Estate [Line Items] | |||
Acquisition Date | [1],[2] | 2020-08 | |
Building and Improvements | [1],[2] | $ 26,699 | |
Furniture, Fixtures and Equipment | [1],[2] | 7,137 | |
Accumulated Depreciation | [1],[2] | (2,621) | |
Real Estate Owned, Net | [1],[2] | $ 31,215 | |
[1] Refer to Note 2 – “Summary of Significant Accounting Policies” for useful life of the above assets. Represents hotel ground lease interest acquired by the Company by completing a deed-in-lieu of foreclosure transaction. |
Real Estate Owned - Additional
Real Estate Owned - Additional Information (Details) - Paycheck Protection Program - USD ($) | 1 Months Ended | |
Feb. 28, 2021 | Dec. 31, 2022 | |
Real Estate [Line Items] | ||
Loans amount | $ 1,093,000 | |
Loan term | 5 years | |
Fixed interest rate | 1% | |
Accrued expenses | $ 0 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Aug. 20, 2020 | |
Leases [Abstract] | |||
Lessee finance lease description | The Company is the lessee under one ground lease. The ground lease, which commenced on April 1, 1999, was assumed as part of a property acquired through a deed-in-lieu of foreclosure transaction on August 20, 2020 and extends through March 31, 2098. The lease is classified as a finance lease. Under the ground lease, the Company is prohibited from mortgaging the land but is not prohibited from making a leasehold mortgage for property constructed on the land. The Company may terminate the lease as of March 31, 2049, March 31, 2065 and March 31, 2081 provided that twelve months’ notice is provided to the lessor prior to those respective dates. | ||
Finance lease, commencement date | Apr. 01, 1999 | ||
Finance lease, expiration date | Mar. 31, 2098 | ||
Lessee finance lease termination description | Company may terminate the lease as of March 31, 2049, March 31, 2065 and March 31, 2081 | ||
Finance lease liability | $ 17,457 | $ 17,105 | $ 16,827 |
Finance lease, right of use asset | $ 5,549 | $ 5,549 | $ 5,549 |
Finance lease liability, interest rate | 11.37% |
Leases - Summary of Finance Lea
Leases - Summary of Finance Lease Cost (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Leases [Abstract] | |||
Amortization of right-of-use assets | $ 72 | $ 71 | $ 24 |
Interest on lease liabilities | 1,963 | 1,925 | 634 |
Total finance lease cost | $ 2,035 | $ 1,996 | $ 658 |
Leases - Schedule of Finance Le
Leases - Schedule of Finance Lease Right of Use Asset, Net of Amortization (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 20, 2020 |
Leases [Abstract] | |||
Finance lease right of use asset, gross | $ 5,549 | $ 5,549 | $ 5,549 |
Accumulated amortization | (167) | (95) | |
Finance lease right of use asset, net of amortization | $ 5,382 | $ 5,454 |
Leases - Schedule of Lease Paym
Leases - Schedule of Lease Payments for the Ground Lease (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | Aug. 20, 2020 |
Leases [Abstract] | |||
2023 | $ 1,611 | ||
2024 | 1,745 | ||
2025 | 1,772 | ||
2026 | 1,772 | ||
2027 | 1,772 | ||
Thereafter | 267,914 | ||
Total undiscounted lease payments | 276,586 | ||
Less: Amount representing interest | (259,129) | ||
Present value of lease liability | $ 17,457 | $ 17,105 | $ 16,827 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) | 1 Months Ended | ||||||||||||||||||||||||||||||||||||
Mar. 17, 2023 | Feb. 28, 2023 | Feb. 27, 2023 | Feb. 17, 2023 | Jan. 31, 2023 | Jul. 31, 2020 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | Aug. 11, 2022 | |
Subsequent Event [Line Items] | |||||||||||||||||||||||||||||||||||||
Share repurchase program, shares authorized to be repurchased | 0 | ||||||||||||||||||||||||||||||||||||
Distributions record date | Jul. 31, 2020 | Dec. 31, 2022 | Nov. 30, 2022 | Oct. 31, 2022 | Sep. 30, 2022 | Aug. 31, 2022 | Jul. 31, 2022 | Jun. 30, 2022 | May 31, 2022 | Apr. 30, 2022 | Mar. 31, 2022 | Feb. 28, 2022 | Jan. 31, 2022 | Dec. 31, 2021 | Nov. 30, 2021 | Oct. 31, 2021 | Sep. 30, 2021 | Aug. 31, 2021 | Jul. 31, 2021 | Jun. 30, 2021 | May 31, 2021 | Apr. 30, 2021 | Mar. 31, 2021 | Feb. 28, 2021 | Jan. 31, 2021 | Dec. 31, 2020 | Nov. 30, 2020 | Oct. 31, 2020 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | ||||||
Loan loss reserve | $ 3,588,000 | $ 0 | |||||||||||||||||||||||||||||||||||
Principal balance and accrued frees | 17,120,000 | ||||||||||||||||||||||||||||||||||||
Net participation interest | 13,532,000 | ||||||||||||||||||||||||||||||||||||
First Mortgage Loans | |||||||||||||||||||||||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||||||||||||||||||||||
Loan loss reserve | $ 3,588,000 | ||||||||||||||||||||||||||||||||||||
Series A Preferred Repurchase Program | |||||||||||||||||||||||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||||||||||||||||||||||
Share repurchase program, shares authorized to be repurchased | 948,696 | 1,000,000 | |||||||||||||||||||||||||||||||||||
Share repurchase program, authorized amount | $ 15,000,000 | ||||||||||||||||||||||||||||||||||||
6.75% Series A Cumulative Redeemable Preferred Stock | |||||||||||||||||||||||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||||||||||||||||||||||
Percentage of cumulative redeemable preferred stock | 6.75% | 6.75% | |||||||||||||||||||||||||||||||||||
Subsequent Event | Series A Preferred Stock | |||||||||||||||||||||||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||||||||||||||||||||||
Distributions payable date | Mar. 30, 2023 | ||||||||||||||||||||||||||||||||||||
Distributions record date | Mar. 15, 2023 | ||||||||||||||||||||||||||||||||||||
Distributions declared date | Feb. 27, 2023 | ||||||||||||||||||||||||||||||||||||
Distributions declared per share | $ 0.421875 | ||||||||||||||||||||||||||||||||||||
Subsequent Event | Common Stock | |||||||||||||||||||||||||||||||||||||
Subsequent Event [Line Items] | |||||||||||||||||||||||||||||||||||||
Distributions payable date | Mar. 17, 2023 | Feb. 17, 2023 | |||||||||||||||||||||||||||||||||||
Distributions record date | Feb. 28, 2023 | Jan. 31, 2023 |
Subsequent Events - Schedule of
Subsequent Events - Schedule of Declared Distributions for Class of Common Stock (Details) - $ / shares | 12 Months Ended | ||||
Mar. 17, 2023 | Feb. 17, 2023 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | |
Class P Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | $ 1.2504 | $ 1.1669 | $ 0.7648 | ||
Class A Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | 1.2504 | 1.1669 | 0.7148 | ||
Class T Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | 1.2504 | 1.1669 | 0.7148 | ||
Stockholder servicing fee per share | 0.1685 | 0.1720 | 0.1270 | ||
Class D Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | 1.2504 | 1.1669 | 0.7148 | ||
Stockholder servicing fee per share | 0.0498 | 0.0507 | 0.0373 | ||
Class I Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | $ 1.2504 | $ 1.1669 | $ 0.7148 | ||
Subsequent Event | Class P Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | $ 0.1042 | $ 0.1042 | |||
Net distributions declared per share | 0.1042 | 0.1042 | |||
Subsequent Event | Class A Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | 0.1042 | 0.1042 | |||
Net distributions declared per share | 0.1042 | 0.1042 | |||
Subsequent Event | Class T Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | 0.1042 | 0.1042 | |||
Stockholder servicing fee per share | 0.0128 | 0.0142 | |||
Net distributions declared per share | 0.0914 | 0.0900 | |||
Subsequent Event | Class D Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | 0.1042 | 0.1042 | |||
Stockholder servicing fee per share | 0.0038 | 0.0042 | |||
Net distributions declared per share | 0.1004 | 0.1000 | |||
Subsequent Event | Class I Common Stock | |||||
Subsequent Event [Line Items] | |||||
Aggregate gross distributions declared per share | 0.1042 | 0.1042 | |||
Net distributions declared per share | $ 0.1042 | $ 0.1042 |
Subsequent Events - Schedule _2
Subsequent Events - Schedule of Commercial Mortgage Loans Originated (Details) - USD ($) $ in Thousands | Dec. 31, 2022 | Dec. 31, 2021 | |
Subsequent Event [Line Items] | |||
Principal Balance | $ 844,507 | [1] | $ 664,170 |
[1] Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans |
Schedule IV - Mortgage Loans _2
Schedule IV - Mortgage Loans on Real Estate - Schedule of Mortgage Loans on Real Estate (Details) - USD ($) $ in Thousands | 12 Months Ended | |||||
Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | $ 844,507 | [1] | $ 664,170 | |||
Mortgage Loans On Real Estate | 842,278 | [1] | $ 665,498 | $ 441,814 | $ 504,702 | |
First Mortgage Loan 1 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | 14,650 | ||||
Mortgage Loans On Real Estate | [1] | $ 14,892 | ||||
Cash Coupon | [1] | L+4.70% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jan. 09, 2023 | ||||
First Mortgage Loan 2 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 16,915 | ||||
Mortgage Loans On Real Estate | [1] | $ 13,411 | ||||
Cash Coupon | [1] | L+4.50% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jul. 09, 2023 | ||||
First Mortgage Loan 3 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 24,411 | ||||
Mortgage Loans On Real Estate | [1] | $ 24,477 | ||||
Cash Coupon | [1] | L+3.75% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Sep. 09, 2023 | ||||
First Mortgage Loan 4 | Hotel | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 16,150 | ||||
Mortgage Loans On Real Estate | [1] | $ 16,210 | ||||
Cash Coupon | [1] | L+4.20% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jul. 09, 2025 | ||||
First Mortgage Loan 5 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 13,548 | ||||
Mortgage Loans On Real Estate | [1] | $ 13,625 | ||||
Cash Coupon | [1] | L+3.25% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jun. 09, 2024 | ||||
First Mortgage Loan 6 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 47,747 | ||||
Mortgage Loans On Real Estate | [1] | $ 47,938 | ||||
Cash Coupon | [1] | L+2.75% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jul. 09, 2024 | ||||
First Mortgage Loan 7 | Mixed Use | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 6,631 | ||||
Mortgage Loans On Real Estate | [1] | $ 6,642 | ||||
Cash Coupon | [1] | L+3.60% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jul. 09, 2024 | ||||
First Mortgage Loan 8 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 6,712 | ||||
Mortgage Loans On Real Estate | [1] | $ 6,702 | ||||
Cash Coupon | [1] | L+4.20% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Sep. 09, 2024 | ||||
First Mortgage Loan 9 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 15,786 | ||||
Mortgage Loans On Real Estate | [1] | $ 15,821 | ||||
Cash Coupon | [1] | L+3.10% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Oct. 09, 2024 | ||||
First Mortgage Loan 10 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 22,616 | ||||
Mortgage Loans On Real Estate | [1] | $ 22,678 | ||||
Cash Coupon | [1] | L+2.90% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Oct. 09, 2024 | ||||
First Mortgage Loan 11 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 25,506 | ||||
Mortgage Loans On Real Estate | [1] | $ 25,649 | ||||
Cash Coupon | [1] | L+3.30% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Feb. 09, 2025 | ||||
First Mortgage Loan 12 | Retail | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 11,016 | ||||
Mortgage Loans On Real Estate | [1] | $ 11,072 | ||||
Cash Coupon | [1] | L+3.85% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Mar. 09, 2025 | ||||
First Mortgage Loan 13 | Retail | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 9,704 | ||||
Mortgage Loans On Real Estate | [1] | $ 9,727 | ||||
Cash Coupon | [1] | L+3.50 | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Mar. 09, 2025 | ||||
First Mortgage Loan 14 | Office | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 13,647 | ||||
Mortgage Loans On Real Estate | [1] | $ 13,756 | ||||
Cash Coupon | [1] | L+5.00% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Mar. 09, 2026 | ||||
First Mortgage Loan 15 | Industrial | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 20,135 | ||||
Mortgage Loans On Real Estate | [1] | $ 20,167 | ||||
Cash Coupon | [1] | L+4.00% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Mar. 09, 2026 | ||||
First Mortgage Loan 16 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 14,063 | ||||
Mortgage Loans On Real Estate | [1] | $ 14,112 | ||||
Cash Coupon | [1] | L+3.50% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Apr. 09, 2026 | ||||
First Mortgage Loan 17 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 11,544 | ||||
Mortgage Loans On Real Estate | [1] | $ 11,581 | ||||
Cash Coupon | [1] | L+3.50% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Apr. 09, 2026 | ||||
First Mortgage Loan 18 | Industrial | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 9,090 | ||||
Mortgage Loans On Real Estate | [1] | $ 9,090 | ||||
Cash Coupon | [1] | L+4.00% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | May 09, 2026 | ||||
First Mortgage Loan 19 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 28,119 | ||||
Mortgage Loans On Real Estate | [1] | $ 28,119 | ||||
Cash Coupon | [1] | L+3.15% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | May 09, 2026 | ||||
First Mortgage Loan 20 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 11,200 | ||||
Mortgage Loans On Real Estate | [1] | $ 11,215 | ||||
Cash Coupon | [1] | L+3.20% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jun. 09, 2026 | ||||
First Mortgage Loan 21 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 15,689 | ||||
Mortgage Loans On Real Estate | [1] | $ 15,710 | ||||
Cash Coupon | [1] | L+3.10% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jun. 09, 2026 | ||||
First Mortgage Loan 22 | Mixed Use | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 6,430 | ||||
Mortgage Loans On Real Estate | [1] | $ 6,446 | ||||
Cash Coupon | [1] | L+4.50% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jul. 09, 2026 | ||||
First Mortgage Loan 23 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 29,550 | ||||
Mortgage Loans On Real Estate | [1] | $ 29,550 | ||||
Cash Coupon | [1] | L+3.20% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Oct. 09, 2026 | ||||
First Mortgage Loan 24 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 22,655 | ||||
Mortgage Loans On Real Estate | [1] | $ 22,655 | ||||
Cash Coupon | [1] | L+2.95% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Nov. 09, 2026 | ||||
First Mortgage Loan 25 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 25,238 | ||||
Mortgage Loans On Real Estate | [1] | $ 25,238 | ||||
Cash Coupon | [1] | L+2.90% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Nov. 09, 2026 | ||||
First Mortgage Loan 26 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 23,823 | ||||
Mortgage Loans On Real Estate | [1] | $ 23,823 | ||||
Cash Coupon | [1] | L+3.05% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Dec. 09, 2026 | ||||
First Mortgage Loan 27 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 23,409 | ||||
Mortgage Loans On Real Estate | [1] | $ 23,409 | ||||
Cash Coupon | [1] | L+2.85% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Dec. 09, 2026 | ||||
First Mortgage Loan 28 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 39,401 | ||||
Mortgage Loans On Real Estate | [1] | $ 39,401 | ||||
Cash Coupon | [1] | L+3.05% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Dec. 09, 2026 | ||||
First Mortgage Loan 29 | Multifamily | London Interbank Offered Rate (LIBOR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 25,367 | ||||
Mortgage Loans On Real Estate | [1] | $ 25,367 | ||||
Cash Coupon | [1] | L+3.20% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jan. 09, 2027 | ||||
First Mortgage Loan 30 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 37,365 | ||||
Mortgage Loans On Real Estate | [1] | $ 37,365 | ||||
Cash Coupon | [1] | SOFR+3.40% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jan. 09, 2027 | ||||
First Mortgage Loan 31 | Retail | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 16,153 | ||||
Mortgage Loans On Real Estate | [1] | $ 16,153 | ||||
Cash Coupon | [1] | SOFR+3.65% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Feb. 09, 2027 | ||||
First Mortgage Loan 32 | Industrial | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 14,473 | ||||
Mortgage Loans On Real Estate | [1] | $ 14,474 | ||||
Cash Coupon | [1] | SOFR+3.55% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Feb. 09, 2027 | ||||
First Mortgage Loan 33 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 13,937 | ||||
Mortgage Loans On Real Estate | [1] | $ 13,937 | ||||
Cash Coupon | [1] | SOFR+3.30% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Feb. 09, 2027 | ||||
First Mortgage Loan 34 | Mixed Use | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 30,000 | ||||
Mortgage Loans On Real Estate | [1] | $ 30,000 | ||||
Cash Coupon | [1] | SOFR+3.04% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Mar. 09, 2027 | ||||
First Mortgage Loan 35 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 26,591 | ||||
Mortgage Loans On Real Estate | [1] | $ 26,612 | ||||
Cash Coupon | [1] | SOFR+3.40% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Mar. 09, 2027 | ||||
First Mortgage Loan 36 | Industrial | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 16,668 | ||||
Mortgage Loans On Real Estate | [1] | $ 16,668 | ||||
Cash Coupon | [1] | SOFR+3.30% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Apr. 09, 2027 | ||||
First Mortgage Loan 37 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 13,073 | ||||
Mortgage Loans On Real Estate | [1] | $ 13,073 | ||||
Cash Coupon | [1] | SOFR+3.25% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Apr. 09, 2027 | ||||
First Mortgage Loan 38 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 18,406 | ||||
Mortgage Loans On Real Estate | [1] | $ 18,424 | ||||
Cash Coupon | [1] | SOFR+3.40% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | May 09, 2026 | ||||
First Mortgage Loan 39 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 44,589 | ||||
Mortgage Loans On Real Estate | [1] | $ 44,589 | ||||
Cash Coupon | [1] | SOFR+3.45% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Jun. 09, 2027 | ||||
First Mortgage Loan 40 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 27,000 | ||||
Mortgage Loans On Real Estate | [1] | $ 27,000 | ||||
Cash Coupon | [1] | SOFR+3.90% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Sep. 09, 2027 | ||||
First Mortgage Loan 41 | Multifamily | Secured Overnight Financing Rate (SOFR) | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 22,000 | ||||
Mortgage Loans On Real Estate | [1] | $ 22,000 | ||||
Cash Coupon | [1] | SOFR+3.90% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Dec. 09, 2027 | ||||
Credit Loan 1 | Office | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 7,500 | ||||
Mortgage Loans On Real Estate | [1] | $ 7,500 | ||||
Cash Coupon, Rate | [1] | 9.20% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Oct. 11, 2027 | ||||
Credit Loan 2 | Office | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Principal Balance | [1] | $ 6,000 | ||||
Mortgage Loans On Real Estate | [1] | $ 6,000 | ||||
Cash Coupon, Rate | [1] | 10% | ||||
Periodic Payment Terms | [2] | I/O | ||||
Maximum Maturity | [3] | Oct. 06, 2024 | ||||
[1] Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans I/O = interest only, P/I = principal and interest. Maximum maturity assumes all extension options are exercised. |
Schedule IV - Mortgage Loans _3
Schedule IV - Mortgage Loans on Real Estate - Schedule of Mortgage Loans on Real Estate (Parenthetical) (Details) | 12 Months Ended |
Dec. 31, 2022 | |
Mortgage Loans On Real Estate [Line Items] | |
Undivided senior interest sold | 80% |
Interest rate on loan participants sold | L+2.00 |
Spread on loan participations sold | 2% |
Undivided subordinate interest retained | 20% |
London Interbank Offered Rate (LIBOR) | |
Mortgage Loans On Real Estate [Line Items] | |
Mortgage loans floor interest rate | 0.83% |
Secured Overnight Financing Rate (SOFR) | |
Mortgage Loans On Real Estate [Line Items] | |
Mortgage loans floor interest rate | 0.53% |
Schedule IV - Mortgage Loans _4
Schedule IV - Mortgage Loans on Real Estate - Schedule of Reconciliation of Commercial Mortgage Loans, at Cost (Details) - USD ($) $ in Thousands | 1 Months Ended | 12 Months Ended | |||
May 31, 2020 | Dec. 31, 2022 | Dec. 31, 2021 | Dec. 31, 2020 | ||
Mortgage Loans On Real Estate [Abstract] | |||||
Balance at Beginning of Year | $ 665,498 | $ 441,814 | $ 504,702 | ||
Loan fundings | 300,576 | 337,033 | 69,135 | ||
Deferred interest capitalized on commercial loan | 0 | 0 | 386 | ||
Amortization of deferred fees and expenses | 616 | 1,440 | 1,818 | ||
Collections of principal | (120,240) | (114,558) | (99,727) | ||
Sale of commercial loan | $ (10,000) | 0 | 0 | (10,000) | |
Provision for loan losses | (3,588) | 0 | (4,726) | ||
Transfer on deed-in-lieu of foreclosure to real estate owned | 0 | 0 | (19,774) | ||
Net fees capitalized into carrying value of loans | (584) | (231) | 0 | ||
Balance at End of Period | $ 842,278 | [1] | $ 665,498 | $ 441,814 | |
[1] Cash coupon is the stated rate on the loan. Our first mortgage loans are all floating rate and each contains a minimum LIBOR floor. As of December 31, 2022, the weighted average LIBOR and SOFR floor for these loans were 0.83 % and 0.53 %, respectively. An 80 % undivided senior interest in each of loan numbers 1, 2, 3, 5, 7, 10 and 11, which includes the right to receive priority interest payments at a rate of L+ 2.00 %, was sold by our Operating Partnership pursuant to a Loan Participation Agreement dated November 15, 2021. Our Operating Partnership has retained a 20 % undivided subordinate interest in each of these loans |