Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2020 | Nov. 11, 2020 | |
Document And Entity Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2020 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | ck0001690012 | |
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 Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | true | |
Entity Shell Company | false | |
Entity File Number | 000-55782 | |
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 Quarterly Report | true | |
Document Transition Report | false | |
Class P Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 10,151,787 | |
Class T Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 397,575 | |
Class I Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 379,326 | |
Class A Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 654,322 | |
Class D Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 50,184 | |
Class S Common Stock | ||
Document And Entity Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 0 |
CONSOLIDATED BALANCE SHEETS (un
CONSOLIDATED BALANCE SHEETS (unaudited) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
ASSETS | ||
Cash and cash equivalents | $ 52,828 | $ 37,210 |
Restricted cash | 429 | |
Real estate securities at fair value | 12,790 | 157,869 |
Commercial mortgage loans at cost | 446,744 | 504,702 |
Real estate owned, net of depreciation | 32,756 | |
Finance lease right of use asset, net of amortization | 5,543 | |
Deferred debt finance costs | 933 | 1,133 |
Receivable for real estate securities sold | 12,066 | |
Accrued interest receivable | 1,147 | 1,822 |
Prepaid expenses and other assets | 1,011 | 154 |
Total assets | 565,818 | 703,319 |
Liabilities: | ||
Repurchase agreements—real estate securities | 107,489 | |
Repurchase agreements—commercial mortgage loans | 301,330 | 335,805 |
Finance lease liability | 16,717 | |
Loan fees payable | 231 | 55 |
Due to related parties | 2,013 | 698 |
Interest payable | 230 | 652 |
Distributions payable | 866 | 1,699 |
Accrued expenses | 3,611 | 755 |
Total liabilities | 324,998 | 447,153 |
Stockholders’ Equity: | ||
Additional paid in capital (net of offering costs of $24,852 and $22,718 at September 30, 2020 and December 31, 2019, respectively) | 287,476 | 265,963 |
Accumulated deficit | (46,667) | (9,807) |
Total stockholders’ equity | 240,820 | 256,166 |
Total liabilities and stockholders’ equity | 565,818 | 703,319 |
Class P Common Stock | ||
Stockholders’ Equity: | ||
Common stock | 10 | 10 |
Total stockholders’ equity | 10 | 10 |
Class A Common Stock | ||
Stockholders’ Equity: | ||
Common stock | 1 | 0 |
Total stockholders’ equity | 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 |
CONSOLIDATED BALANCE SHEETS (_2
CONSOLIDATED BALANCE SHEETS (unaudited) (Parenthetical) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Additional paid in capital, offering costs | $ 24,852 | $ 22,718 |
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 | 10,151,787 | 10,182,305 |
Common stock, shares, outstanding | 10,151,787 | 10,182,305 |
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 | 653,566 | 272,006 |
Common stock, shares, outstanding | 653,566 | 272,006 |
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 | 397,251 | 121,718 |
Common stock, shares, outstanding | 397,251 | 121,718 |
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 | 50,081 | 41,538 |
Common stock, shares, outstanding | 50,081 | 41,538 |
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 | 378,302 | 100,743 |
Common stock, shares, outstanding | 378,302 | 100,743 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Income: | ||||
Interest income | $ 7,667 | $ 9,464 | $ 26,782 | $ 24,511 |
Less: Interest expense | (1,983) | (3,734) | (8,628) | (9,998) |
Net interest income | 5,684 | 5,730 | 18,154 | 14,513 |
Revenue from real estate owned | 365 | 365 | ||
Total income | 6,049 | 5,730 | 18,519 | 14,513 |
Operating expenses: | ||||
Advisory fee | 1,572 | 1,601 | 3,973 | 5,086 |
Debt finance costs | 403 | 271 | 961 | 692 |
Directors compensation | 25 | 22 | 73 | 66 |
Professional service fees | 246 | 183 | 1,758 | 492 |
Real estate owned operating expenses | 944 | 944 | ||
Depreciation and amortization | 122 | 122 | ||
Other expenses | 209 | 192 | 681 | 358 |
Total operating expenses | 3,521 | 2,269 | 8,512 | 6,694 |
Other income (loss): | ||||
Reversal of (provision for) loan losses | 54 | (5,711) | ||
Realized loss on sale of commercial loan | (375) | |||
Unrealized gain (loss) in value of real estate securities | 13,404 | (205) | (5,499) | 1,585 |
Realized loss on the sale of real estate securities | (9,930) | (29,218) | (43) | |
Total other income (loss) | 3,528 | (205) | (40,803) | 1,542 |
Net income (loss) | $ 6,056 | $ 3,256 | $ (30,796) | $ 9,361 |
Net income (loss) per share basic and diluted | $ 0.52 | $ 0.32 | $ (2.67) | $ 1.11 |
Weighted average number of shares | ||||
Basic | 11,630,987 | 10,116,083 | 11,537,483 | 8,407,217 |
Diluted | 11,631,431 | 10,116,516 | 11,537,483 | 8,407,450 |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (unaudited) - USD ($) $ in Thousands | Total | Class P Common Stock | Class A Common Stock | Additional Paid in Capital | Accumulated Deficit |
Balance at Dec. 31, 2018 | $ 142,272 | $ 6 | $ 148,650 | $ (6,384) | |
Proceeds from issuance of common stock | 118,804 | 4 | 118,800 | ||
Offering costs | (10,117) | (10,117) | |||
Net income (loss) | 9,361 | 9,361 | |||
Distributions declared | (12,084) | (12,084) | |||
Distribution reinvestment | 1 | 1 | |||
Redemptions | (541) | (541) | |||
Equity-based compensation | 15 | 15 | |||
Balance at Sep. 30, 2019 | 247,711 | 10 | 256,808 | (9,107) | |
Balance at Jun. 30, 2019 | 229,144 | 9 | 236,562 | (7,427) | |
Proceeds from issuance of common stock | 24,488 | 1 | 24,487 | ||
Offering costs | (3,796) | (3,796) | |||
Net income (loss) | 3,256 | 3,256 | |||
Distributions declared | (4,936) | (4,936) | |||
Distribution reinvestment | 1 | 1 | |||
Redemptions | (451) | (451) | |||
Equity-based compensation | 5 | 5 | |||
Balance at Sep. 30, 2019 | 247,711 | 10 | 256,808 | (9,107) | |
Balance at Dec. 31, 2019 | 256,166 | 10 | 265,963 | (9,807) | |
Proceeds from issuance of common stock | 24,262 | $ 1 | 24,261 | ||
Offering costs | (2,135) | (2,135) | |||
Net income (loss) | (30,796) | (30,796) | |||
Distributions declared | (6,064) | (6,064) | |||
Distribution reinvestment | 127 | 127 | |||
Redemptions | (763) | (763) | |||
Equity-based compensation | 23 | 23 | |||
Balance at Sep. 30, 2020 | 240,820 | 10 | 1 | 287,476 | (46,667) |
Balance at Jun. 30, 2020 | 237,530 | 10 | 1 | 287,703 | (50,184) |
Offering costs | (235) | (235) | |||
Net income (loss) | 6,056 | 6,056 | |||
Distributions declared | (2,539) | (2,539) | |||
Equity-based compensation | 8 | 8 | |||
Balance at Sep. 30, 2020 | $ 240,820 | $ 10 | $ 1 | $ 287,476 | $ (46,667) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Cash flows from operating activities: | ||
Net (loss) income | $ (30,796) | $ 9,361 |
Adjustments to reconcile net (loss) income to cash provided by operations: | ||
Net realized loss on real estate securities | 29,218 | 43 |
Net unrealized loss (gain) on real estate securities | 5,499 | (1,585) |
Provision for loan losses | 5,711 | |
Realized loss on sale of commercial mortgage loan | 375 | |
Depreciation and amortization expense | 128 | |
Amortization of equity-based compensation | 23 | 15 |
Amortization of debt finance costs to operating expense | 961 | 692 |
Amortization of debt finance costs to interest expense | 60 | 61 |
Amortization of bond discount | (307) | (594) |
Amortization of origination fees | (1,228) | (1,411) |
Amortization of deferred exit fees | 62 | (406) |
Changes in assets and liabilities: | ||
Accrued interest receivable | 389 | (452) |
Accrued expenses | 503 | 711 |
Loan fees payable | 176 | |
Accrued interest payable | (532) | 142 |
Due to related parties | 687 | 13 |
Prepaid expenses and other assets | (679) | 59 |
Net cash provided by operating activities | 10,250 | 6,649 |
Cash flows from investing activities: | ||
Origination of commercial loans | (59,990) | (254,725) |
Origination fees received on commercial loans | 1,951 | |
Principal repayments of commercial loans | 85,080 | 74,478 |
Proceeds from sale of commercial loan | 9,625 | |
Acquisition of real estate owned | (637) | |
Purchase of real estate securities | (50,459) | |
Proceeds from real estate securities sold | 96,453 | 9,211 |
Real estate securities principal pay-down | 2,178 | 1,215 |
Net cash provided by (used in) investing activities | 132,709 | (218,329) |
Cash flows from financing activities: | ||
Proceeds from issuance of common stock | 24,261 | 118,804 |
Redemptions of common stock | (763) | (541) |
Payment of offering costs | (1,714) | (10,035) |
Proceeds from repurchase agreements | 578,182 | 925,238 |
Principal repayments of repurchase agreements | (720,180) | (789,908) |
Debt finance costs | (786) | (1,487) |
Distributions paid | (6,770) | (11,373) |
Net cash (used in) provided by financing activities | (127,770) | 230,698 |
Net change in cash, cash equivalents and restricted cash | 15,189 | 19,018 |
Cash, cash equivalents and restricted cash at beginning of period | 37,639 | 28,497 |
Cash, cash equivalents and restricted cash at end of period | 52,828 | 47,515 |
Supplemental disclosure of cash flow information: | ||
Change in deferred offering costs and accrued offering expenses, included in due to related parties | (505) | |
Amortization of deferred exit fees due to related party | 208 | |
Interest paid | 9,050 | 9,939 |
Distributions payable | 866 | 1,650 |
Receivables for real estate securities sold | 12,066 | |
Payable for real estate securities purchased | 1,500 | |
Deferred interest capitalized on commercial loan | 258 | |
Accrued stockholder servicing fee due to related party | 420 | 82 |
Distribution reinvestment | $ 127 | $ 1 |
Organization and Business Opera
Organization and Business Operations | 9 Months Ended |
Sep. 30, 2020 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Organization and Business 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 floating-rate first mortgage loans, 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 April 29, 2019 among the Company, the Advisor and the Operating Partnership (the “Advisory Agreement”), which supersedes and replaces the advisory agreement dated October 25, 2016 (the “Prior 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 April 29, 2019. 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 meeting; 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 in anticipation of selling shares in the IPO (described below). The Company accepted 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”) to register up to $2,350,000 in shares of common stock (the “IPO”). On April 29, 2019, the Company filed articles of amendment with the State Department of Assessments and Taxation of the State of Maryland (the “SDAT”) (i) to modify the number of shares of capital stock the Company has authority to issue under its charter from 500,000,000 to 3,050,000,000, consisting of 3,000,000,000 Class P Shares and 50,000,000 shares of preferred stock, and (ii) to modify the aggregate par value of all authorized shares of stock from $500 to $3,050. On April 29, 2019, the Company also filed articles supplementary with SDAT to reclassify and designate: (i) 500,000,000 authorized but unissued Class P Shares as Class A common shares; (ii) 500,000,000 authorized but unissued Class P Shares as Class D common shares; (iii) 500,000,000 authorized but unissued Class P Shares as Class I common shares; (iv) 500,000,000 authorized but unissued Class P Shares as Class S common shares; and (v) 500,000,000 authorized but unissued Class P Shares as Class T common shares. On May 3, 2019, the Securities and Exchange Commission (the “SEC”) declared effective the Registration Statement and the Company commenced the IPO. Prior to July 17, 2019 (the “NAV Pricing Date”), the purchase price for each class of its common stock in its primary offering was $25.00 per share, plus applicable upfront selling commissions and dealer manager fees. Following the NAV Pricing Date, 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 March 24, 2020, the Board suspended (i) the sale of shares in the IPO, (ii) the operation of the share repurchase program (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 suspend the IPO, the SRP, the payment of distributions and the DRP, the Board considered various factors, including the impact of the global 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 has determined since then that there has been reduced volatility in the market for the Company’s investments and some improvement in the U.S. economic outlook and resumed calculation of the NAV beginning as of June 30, 2020. 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. The Company will continue to closely monitor the pandemic, the economy and the markets for the Company’s investments in order to determine an appropriate time to resume the SRP. Please refer to “Note 15 – Subsequent Events” and Part II, “Item 1A – Risk Factors” for updates to the Company’s business after September 30, 2020 and risk factors related to the COVID-19 pandemic, respectively. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 2 – Summary of Significant Accounting Policies Disclosures discussing all significant accounting policies are set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2019 (the “Annual Report”), as filed with the SEC on March 11, 2020, under the heading Note 2 – Summary of Significant Accounting Policies. The Company has added to its significant accounting policies for the nine-months ended September 30, 2020 as a result of a real estate property acquired via a deed-in-lieu of foreclosure in August 2020. 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. In the opinion of management, the accompanying unaudited consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. 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 September 30, 2020, the Company had one finance lease assumed as part of a deed-in-lieu of foreclosure of a hotel property during August 2020. 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 September 30, 2020, the Company had repaid all outstanding repurchase agreements secured by real estate securities and, therefore, had no required additional collateral posted. The following table provides a reconciliation of cash, cash equivalents and restricted cash in the Company’s consolidated balance sheets to the total amount shown in the Company’s consolidated statements of cash flows: September 30, December 31, 2020 2019 Cash and cash equivalents $ 52,828 $ 37,210 Restricted cash — 429 Total cash, cash equivalents, and restricted cash $ 52,828 $ 37,639 Accounting Pronouncements Recently Issued but Not Yet Effective 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 changes how entities measure credit losses for financial assets carried at amortized cost. ASU 2016-13 eliminates the requirement that a credit loss must be probable before it can be recognized and instead requires an entity to recognize the current estimate of all expected credit losses. ASU 2016-13 is 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. The Company has elected to use this extension and is continuing to evaluate the impact ASU 2016-13 will have on its allowance for loan losses estimate. |
Commercial Mortgage Loans Held
Commercial Mortgage Loans Held for Investment | 9 Months Ended |
Sep. 30, 2020 | |
Mortgage Loans On Real Estate [Abstract] | |
Commercial Mortgage Loans Held for Investment | Note 3 – Commercial Mortgage Loans Held for Investment The tables below show the Company’s commercial mortgage loans held for investment as of September 30, 2020 and December 31, 2019: September 30, 2020 Number of Loans Principal Balance Unamortized (fees)/costs, net Carrying Value Weighted Average Interest Rate Weighted Average Years to Maturity First mortgage loans 26 $ 430,569 $ (325 ) $ 430,244 5.3 % 1.7 Credit loans 3 16,500 — 16,500 9.5 % 5.1 Total and average 29 $ 447,069 $ (325 ) $ 446,744 5.5 % 1.8 December 31, 2019 Number of Loans Principal Balance Unamortized (fees)/costs, net Carrying Value Weighted Average Interest Rate Weighted Average Years to Maturity First mortgage loans 29 $ 489,902 $ (1,700 ) $ 488,202 5.6 % 2.0 Credit loans 3 16,500 — 16,500 9.5 % 5.9 Total and average 32 $ 506,402 $ (1,700 ) $ 504,702 5.7 % 2.2 For the nine months ended September 30, 2020 and the year ended December 31, 2019, the activity in the Company’s commercial mortgage loans, held-for-investment portfolio was as follows: Nine Months Ended September 30, 2020 Year Ended December 31, 2019 Balance at Beginning of Year $ 504,702 $ 249,573 Loan originations 59,990 329,155 Principal repayments (85,080 ) (74,478 ) Amortization of loan origination and deferred exit fees 1,374 2,403 Sale of commercial loan (10,000 ) — Origination fees received on commercial loans — (1,951 ) Provision for loan losses (5,711 ) — Deferred interest capitalized on commercial loan 258 — Transfer on deed-in-lieu of foreclosure to real estate owned (18,789 ) — Balance at End of Period $ 446,744 $ 504,702 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: Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019 Beginning of period $ — $ — Provision for loan losses (5,711 ) — Charge-offs 5,711 — Ending allowance for loan losses $ — $ — In accordance with the Company’s allowance for loan loss policy, during the nine-month period ended September 30, 2020, the Company recorded impairment charges of $5,711 on one first mortgage loan secured by a hotel property in Illinois. The impairment charges were based on the estimated fair value of the underlying collateral, and the loan was terminated during August in connection with the Company’s acquisition of the collateral via a deed-in-lieu of foreclosure. In addition, the Company previously recorded a provision for loan loss of $1,500 on a mezzanine loan secured by a hotel property in Miami, Florida that had been negatively impacted by the economic effects of the COVID-19 pandemic. During the quarter ended September 30, 2020, the Company determined that the loan had improved and that a loss was no longer probable. As such, the $1,500 allowance for loan loss previously recorded was reversed against the provision for loan losses. For the three and nine months ended September 30, 2020, interest income for the impaired loan was $0 and $465, respectively. For further information on the Company’s allowance for loan losses policy, see “Note 2 – Summary of Significant Accounting Policies” in its Annual Report . 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 or acquisition. As of September 30, 2020, 19 loans had a risk rating of 2, seven had a risk rating of 3 and three had a risk rating of 4. As of December 31, 2019, 30 loans had a risk rating of 2 and two had a risk rating of 3. Loan Modifications During April 2020, the Company agreed to modify one first mortgage loan on a hospitality property providing for a two-month partial reduction in the required monthly interest payment with payment of the amount by which the interest payments were reduced deferred to the nine-month period beginning in October 2020. During June 2020, the partial reduction of the monthly interest payments was extended through the July payment, and during August 2020 this was further extended through the September payment. Later during August 2020, the Company agreed, in exchange for a fee charged to the borrower, to further modify this loan to provide partial reduction of the monthly interest payments through December 2020 with repayment of all the deferred payments, including those previously deferred, to be made during a nine-month period beginning in January 2021. Prior to the COVID-19 pandemic, the loan was current on all required payments. |
Real Estate Securities
Real Estate Securities | 9 Months Ended |
Sep. 30, 2020 | |
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 are 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 tables below show the Company’s real estate securities as of September 30, 2020 and December 31, 2019: September 30, 2020 Number of Positions External Credit Rating Collateral Weighted Average Interest Rate Weighted Average Years to Maturity Par Value Amortized Cost Unrealized Gains Unrealized Losses Fair Value 1 BB- Hospitality 3.6 % 0.7 8,500 8,500 — (1,290 ) 7,210 1 B+ Hospitality 3.9 % — 10,000 10,000 — (4,420 ) 5,580 2 3.7 % 0.3 $ 18,500 $ 18,500 $ — $ (5,710 ) $ 12,790 December 31, 2019 Number of Positions External Credit Rating Collateral Weighted Average Interest Rate Weighted Average Years to Maturity Par Value Amortized Cost Unrealized Gains Unrealized Losses Fair Value 3 AAA Hospitality, Office 2.6 % 0.5 $ 19,113 $ 19,081 $ — $ (43 ) $ 19,038 1 AA- Hospitality 2.8 % 0.4 2,000 1,999 — (11 ) 1,988 9 BB- Retail, Hospitality, Mixed Use, Office 4.4 % 1.3 72,052 72,033 104 (81 ) 72,056 1 BBB- Multifamily 3.4 % 1.5 10,000 10,000 — — 10,000 3 Unrated Hospitality 7.0 % 0.7 55,275 54,967 — (180 ) 54,787 17 5.0 % 1.0 $ 158,440 $ 158,080 $ 104 $ (315 ) $ 157,869 At September 30, 2020, the Company held two CMBS with a total carrying value of $12,790 and a total net unrealized loss of $5,710. At December 31, 2019, the Company held 17 CMBS with a total carrying value of $157,869 and a total net unrealized loss of $211. The increase in the unrealized loss was primarily attributed to the significant economic impact of the COVID-19 pandemic on the economy. In particular, CMBS secured by hospitality properties were severely impacted due to concerns over a decline in hotel stays throughout the country. During the three and nine months ended September 30, 2020, the Company sold real estate securities for $52,525 and $96,453, respectively, that resulted in realized losses of $9,930 and $29,218, respectively. During the nine months ended September 30, 2019, the Company sold real estate securities for $9,211 that resulted in realized losses of $43. As of September 30, 2020, one of the CMBS had an internal risk rating of 3 and one of the CMBS had an internal risk rating of 5. As of December 31, 2019, each CMBS had an internal risk rating of 2. |
Repurchase Agreements
Repurchase Agreements | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure Of Repurchase Agreements [Abstract] | |
Repurchase Agreements | Note 5 – Repurchase Agreements Commercial Mortgage Loans On February 15, 2018, the Company, through a wholly owned subsidiary, entered into a master repurchase agreement (the “CF Repo Facility”) with Column Financial, Inc. as administrative agent for certain of its affiliates. The CF Repo Facility had an initial advance amount of $100,000 subject to a maximum advance amount of $250,000. The Company increased the advance amount in August 2018 to $175,000, and in January 2019 to $250,000. In March 2020, the Company temporarily increased the maximum advance amount to $300,000, and this increase expired on June 30, 2020 and the maximum advance amount reverted to $250,000. The initial term of the CF Repo Facility was 12 months and the Company extended the maturity date in March 2020 to February 2021. Advances under the CF Repo Facility accrue interest at a per annum rate equal to the London Interbank Offered Rate (“LIBOR”) plus 2.0%. The CF Repo Facility is subject to certain financial covenants. The Company was in compliance with all financial covenant requirements as of September 30, 2020 and December 31, 2019. 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 under the JPM Repo Facility accrue interest at per annum rates equal to the sum of (i) the applicable LIBOR index rate plus (ii) a margin of between 1.75% to 2.50%, depending on the attributes of the purchased assets. The initial maturity date of the JPM Repo Facility is May 6, 2021, with two successive one-year extensions at the Company’s option, which may be exercised upon the satisfaction of certain conditions. The JPM Repo Facility is subject to certain financial covenants. The Company was in compliance with all financial covenant requirements as of September 30, 2020 and December 31, 2019. The JPM Repo Facility and CF Repo Facility (collectively, the “Repo 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 tables below show the Repo Facilities as of September 30, 2020 and December 31, 2019: September 30, 2020 Weighted Average Committed Financing Amount Outstanding (1) Accrued Interest Payable Collateral Pledged Interest Rate Days to Maturity CF Repo Facility $ 250,000 $ 170,598 $ 132 $ 242,577 2.15 % 135 JPM Repo Facility 150,000 130,778 98 187,992 2.07 % 218 $ 400,000 $ 301,376 $ 230 $ 430,569 2.12 % 171 December 31, 2019 Weighted Average Committed Financing Amount Outstanding (1) Accrued Interest Payable Collateral Pledged Interest Rate Days to Maturity CF Repo Facility $ 250,000 $ 224,590 $ 327 $ 304,708 3.74 % 318 JPM Repo Facility 150,000 111,295 157 153,194 3.63 % 492 $ 400,000 $ 335,885 $ 484 $ 457,902 3.70 % 376 (1) Excludes $46 and $80 of unamortized debt issuance costs at September 30, 2020 and December 31, 2019, respectively. Real Estate Securities The Company entered into two master repurchase agreements f Weighted Average Amount Outstanding Accrued Interest Payable Collateral Pledged Interest Rate Days to Maturity As of September 30, 2020 $ — $ — $ — — — As of December 31, 2019 $ 107,489 $ 168 $ 149,164 3.14 % 11 During the three-month period ended September 30, 2020, the Company repaid all balances under the master repurchase agreements. The total amount outstanding as of December 31, 2019 was with JP Morgan Securities LLC. The master repurchase agreements are subject to certain financial covenants. The Company had no borrowings as of September 30, 2020 and, therefore, was not subject to any financial covenant requirements. The Company was in compliance with all financial covenant requirements as of December 31, 2019. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2020 | |
Equity [Abstract] | |
Stockholders' Equity | Note 6 – Stockholders’ Equity The following tables detail the change in the Company’s outstanding shares of all classes of common stock, including restricted common stock: Common Stock Nine-months ended September 30, 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 — 8,066 276,250 Distribution reinvestment — 2,310 963 — 477 1,309 Issuance of restricted shares — — — — — — Redemptions (30,518 ) — — — — — Ending balance 10,151,787 653,566 397,251 — 50,081 378,302 Common Stock Nine-months ended September 30, 2019 Class P Class A Class T Class S Class D Class I Beginning balance 5,940,744 — — — — — Issuance of shares 4,315,524 36,227 43,296 — 8,961 9,093 Issuance of restricted shares 2,400 — — — — — Redemptions (21,575 ) — — — — — Ending balance 10,237,093 36,227 43,296 — 8,961 9,093 Distributions 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 th th th The table below presents the aggregate and net distributions declared for each applicable class of common stock during the nine-months ended September 30, 2020 and 2019. The table excludes from distribution declaration any month when there were no outstanding shares for a class of stock. Common Stock Nine-months ended September 30, 2020 Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.5398 $ 0.4898 $ 0.4898 $ — $ 0.4898 $ 0.4898 Stockholder servicing fee per share N/A N/A 0.0809 — 0.0237 N/A Net distributions declared per share $ 0.5398 $ 0.4898 $ 0.4089 $ — $ 0.4661 $ 0.4898 Common Stock Nine-months ended September 30, 2019 Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 1.4400 $ 0.1350 $ 0.2700 $ — $ 0.1350 $ 0.2700 Stockholder servicing fee per share N/A N/A 0.0355 — 0.0052 N/A Net distributions declared per share $ 1.4400 $ 0.1350 $ 0.2345 $ — $ 0.1298 $ 0.2700 As of September 30, 2020, and December 31, 2019, distributions declared but not yet paid amounted to $866 and $1,699, respectively. On March 24, 2020, the Board suspended the payment of distributions to the Company’s stockholders. In determining to suspend the payment of distributions, the Board considered various factors, including the impact of the global 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 has determined since then that there has been reduced volatility in the market for the Company’s investments and some improvement in the U.S. economic outlook and resumed calculation of the NAV beginning as of June 30, 2020. In August 2020, the Company resumed paying distributions monthly to stockholders of record for all classes of shares. Please refer to “Note 15 – Subsequent Events” and Part II, “Item 1A – Risk Factors” for updates on the Company’s business after September 30, 2020 and risk factors related to the COVID-19 pandemic, respectively. |
Net (Loss) Income Per Share
Net (Loss) Income Per Share | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Net (Loss) Income Per Share | Note 7 – Net (Loss) Income Per Share Basic earnings per share (“EPS”) are 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. The Company’s common share equivalents are unvested restricted shares. The Company excludes antidilutive restricted shares from the calculation of weighted-average shares for diluted earnings per share. There were zero and 285 antidilutive restricted shares for the three and nine months ended September 30, 2020, respectively. There were no antidilutive restricted shares for the three months and nine months ended September 30, 2019. ee “Note 11 – Equity-Based Compensation.” The following table is a summary of the basic and diluted net (loss) income per share computation for the three and nine-months ended September 30, 2020 and 2019: Three-months ended September 30, Nine-months ended September 30, 2020 2019 2020 2019 Net income (loss) $ 6,056 $ 3,256 $ (30,796 ) $ 9,361 Weighted average shares outstanding, basic 11,630,987 10,116,083 11,537,483 8,407,217 Dilutive effect of restricted stock 444 433 — 233 Weighted average shares outstanding, diluted 11,631,431 10,116,516 11,537,483 8,407,450 Net income (loss) per share, basic and diluted $ 0.52 $ 0.32 $ (2.67 ) $ 1.11 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2020 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 8 – 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 CRE loans if the borrower meets certain conditions. As of September 30, 2020, the Company had 20 such loans with a total remaining future funding commitment of $53,890. As of December 31, 2019, the Company had 22 such loans with a total remaining future funding commitment of $54,620. The Company advances future funds if the borrower meets certain requirements as specified in the individual loan agreements. |
Segment Reporting
Segment Reporting | 9 Months Ended |
Sep. 30, 2020 | |
Segment Reporting [Abstract] | |
Segment Reporting | Note 9 – Segment Reporting The Company has one reportable segment as defined by GAAP for the nine months ended September 30, 2020 and 2019. |
Transactions with Related Parti
Transactions with Related Parties | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Transactions with Related Parties | Note 10 – Transactions with Related Parties As of September 30, 2020, 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 equal to $25.00, 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 Company’s 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 SRP prior to the fifth anniversary of the date on which such Class P 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 September 30, 2020, 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 $25.00, 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 Company’s sub-advisor, (i) it will not be eligible to submit a request for the repurchase of these 120,000 Class P Shares pursuant to the SRP prior to the fifth anniversary of the date on which such Class P Shares were purchased (November 2021); and (ii) 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. The following table summarizes the Company’s related party transactions for the three and nine-months ended September 30, 2020 and 2019 and the amount due to related parties at September 30, 2020 and December 31, 2019: Three-months ended September 30, Nine-months ended September 30, Payable as of September 30, Payable as of December 31, 2020 2019 2020 2019 2020 2019 Organization and offering expense reimbursement (1) $ — $ 61 $ 70 $ 328 $ — $ 17 Selling commissions and dealer manager fee (2) — 1,243 758 6,860 — — Advisory fee (3) 1,572 1,601 3,973 5,086 525 — Loan fees (4) 137 1,070 1,230 1,070 795 408 Accrued stockholder servicing fee (5) — 82 446 82 693 273 Operating expense reimbursement to advisor (6) — — — 5 — — Total $ 1,709 $ 4,057 $ 6,477 $ 13,431 $ 2,013 $ 698 (1) The Company reimbursed the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the Private Offering, provided that aggregate reimbursements of such costs and expenses did not exceed the organization and offering expenses paid by investors in connection with the sale of Class P Shares in the Private Offering. The Company 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 IPO. For the Private Offering, o (2) The Dealer Manager received selling commissions up to 5%, and a dealer manager fee up to 3%, of the transaction price for each Class P Share sold in the Private Offering, the majority of which was paid to third-party broker-dealers. For the IPO, 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 DRP. (3) Under the Prior Advisory Agreement, the Company paid the Advisor an advisory fee comprised of (1) a fixed component and (2) a performance component. The fixed component of the advisory fee was paid quarterly in arrears in an amount equal to 1/4th of 1.5% of the average aggregate value of the Company’s assets over such quarter, where the value of each asset shall be the value determined in accordance with the Company’s valuation policies or, if such value has not yet been determined, the book value of the asset. The performance component of the advisory fee was calculated and paid annually with respect to the Class P Shares, such that for any year in which the Company’s total return per Class P Share exceeds 7% per annum, the Advisor received 20% of the excess total return allocable to the Class P Shares; provided that in no event did the performance component of the advisory fee exceed 15% of the aggregate total return allocable to Class P Shares for such year. On April 29, 2019, the Company, the Advisor and the Operating Partnership entered into the Advisory Agreement, which superseded and replaced the Prior Advisory Agreement. Pursuant to the Advisory Agreement, (1) the fixed component of the advisory fee is paid in an amount equal to (i) prior to the NAV Pricing Date, 1/4th of 1.5% per annum of the gross value of the Company’s assets, paid quarterly in arrears, and (ii) following the NAV Pricing Date, 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 shall not exceed 1/12th of 2.5% of the Company’s NAV; and (2) 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. For the nine months ended September 30, 2020, the Advisor waived $874 of the fixed component of the advisory fees. ( 4 ) Effective July 17, 2019, 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. ( 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) The Company reimburses 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 does not reimburse overhead costs, including rent and utilities or personnel costs (including salaries, bonuses, benefits and severance payments) and the Company will only reimburse the Advisor for fees payable to its affiliates if they are incurred for legal or marketing services rendered on the Company’s behalf. |
Equity-Based Compensation
Equity-Based Compensation | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Equity-Based Compensation | Note 11 – Equity-Based Compensation On December 2, 2019, the Company granted each of its three independent directors 399 restricted Class I shares for a total of 1,197 Class I shares with a grant date fair value of $25.07 per share and a total value of $30. The restricted Class I shares vest in equal one-third increments on December 2, 2020, 2021 and 2022. On January 7, 2019, the Company granted 400 restricted Class P Shares to each of its three independent directors for a total of 1,200 Class P Shares with a grant date fair value of $25.00 per share and a total value of $30. These restricted Class P Shares vest in equal one-third increments on January 7, 2020, 2021 and 2022. On March 1, 2018, the Company granted 400 restricted Class P Shares to each of its three independent directors for a total of 1,200 Class P Shares with a grant date fair value of $25.00 per share and a total value of $30. These restricted Class P Shares vest in equal one-third increments on March 1, 2019, 2020 and 2021. Under the Company’s Independent Director Restricted Share Plan, 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 grant date. 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 $8 and $23, in the aggregate, for the three-months and nine-months ended September 30, 2020, respectively. Compensation expense associated with the restricted shares issued to the independent directors was $5 and $15 for the three and nine-months ended September 30, 2019, respectively. As of September 30, 2020, the Company had $38 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 1.29 years. The total fair value at the vesting date for restricted shares that vested during the nine-months ended September 30, 2020 and 2019 was $17 and $10, respectively. There were no restricted shares that vested during the three-months ended September 30, 2020 and 2019. A summary table of the status of the restricted shares is presented below: Restricted Shares Weighted Average Grant Date Fair Value Per Share Outstanding at December 31, 2019 3,197 $ 25.02 Granted — — Vested (800 ) 25.00 Converted — — Forfeited — — Outstanding at September 30, 2020 2,397 $ 25.03 |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Note 12 – Fair Value of Financial Instruments The following table presents the Company’s financial instruments measured on a recurring basis and carried at fair value in the consolidated balance sheets by their level in the fair value hierarchy (see Note 2 – Summary of Significant Accounting Policies September 30, 2020 December 31, 2019 Total Level I Level II Level III Total Level I Level II Level III Real estate securities $ 12,790 — $ 12,790 — $ 157,869 — $ 157,869 — The Company did not transfer any assets within fair value levels during the three and nine months ended September 30, 2020 and 2019. GAAP requires the disclosure of fair value information about financial instruments, whether or not they are recognized at fair value in the consolidated balance sheets, for which it is practicable to estimate that value. The following table details the carrying amount and estimated fair value of the Company’s financial instruments at the dates below: September 30, 2020 December 31, 2019 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Financial assets Cash and cash equivalents $ 52,828 $ 52,828 $ 37,210 $ 37,210 Restricted cash — — 429 429 Commercial mortgage loans, net 446,744 452,415 504,702 511,734 Total $ 499,572 $ 505,243 $ 542,341 $ 549,373 Financial liabilities Repurchase agreements - real estate securities $ — $ — $ 107,489 $ 107,489 Repurchase agreements - commercial mortgage loans 301,330 301,330 335,805 335,805 Total $ 301,330 $ 301,330 $ 443,294 $ 443,294 The following describes the Company’s methods for estimating the fair value for financial instruments: • The estimated fair value of cash and cash equivalents and restricted cash was 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. The Sub-Advisor estimates the fair values of commercial loans by analyzing interest rate spreads on loans based on various factors including capitalization rates, occupancy rates, sponsorship, geographic concentration, collateral type, market conditions and actions of other lenders. • The estimated fair value of repurchase agreements is a Level 3 fair value measurement based on an expected present value technique. 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 with similar characteristics and credit quality. |
Real Estate Owned
Real Estate Owned | 9 Months Ended |
Sep. 30, 2020 | |
Real Estate [Abstract] | |
Real Estate Owned | Note 13 – Real Estate Owned The following table summarizes the Company’s REO assets as of September 30, 2020: 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 $ 26,683 $ 6,195 $ (122 ) $ 32,756 (1) Refer to Note 2 – Summary of Significant Accounting Policies for useful life of the above assets. (2) Represents assets acquired by the Company by completing a deed-in-lieu of foreclosure transaction. |
Leases
Leases | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Leases | Note 14 – 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 reasonable and within the range of the Company’s incremental borrowing rate. For the nine months ended September 30, 2020 and 2019, total finance lease cost was comprised as follows: Three-months ended September 30, Nine-months ended September 30, 2020 2019 2020 2019 Amortization of right-of-use assets $ 6 $ — $ 6 $ — Interest on lease liabilities 158 — 158 — Total finance lease cost $ 164 $ — $ 164 $ — The table below shows the Company’s finance lease right of use asset, net of amortization as of September 30, 2020 and December 31, 2019: September 30, December 31, 2020 2019 Finance lease right of use asset, gross $ 5,549 $ — Accumulated amortization (6 ) — Finance lease right of use asset, net of amortization $ 5,543 $ — Lease payments for the ground lease as of September 30, 2020 for each of the five succeeding years and thereafter is as follows: Lease Payments 2020 $ 268 2021 1,611 2022 1,611 2023 1,611 2024 1,731 Thereafter 273,377 Total undiscounted lease payments $ 280,209 Less: Amount representing interest (263,492 ) Present value of lease liability $ 16,717 |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 15 – Subsequent Events The Company has evaluated subsequent events through November 12, 2020, the date the financial statements were issued. The following are updates on the Company’s operations since September 30, 2020, including with respect to the ongoing COVID-19 pandemic. Resumption of IPO and DRP 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. Distributions The Board has authorized distributions for each class of its common stock in the amount per share set forth below: Common Stock Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.0750 $ 0.0750 $ 0.0750 $ — $ 0.0750 $ 0.0750 Stockholder servicing fee per share N/A N/A 0.0156 — 0.0046 N/A Net distributions declared per share $ 0.0750 $ 0.0750 $ 0.0594 $ — $ 0.0704 $ 0.0750 The net distributions for each class of common stock (which represents the gross distributions less stockholder servicing fees for the applicable class of common stock) are payable to stockholders of record as of the close of business on October 31, 2020 and will be paid on or about November 18, 2020. These distributions will be paid in cash or, for stockholders participating in the DRP, reinvested in shares of the Company’s common stock. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2020 | |
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. In the opinion of management, the accompanying unaudited consolidated financial statements reflect all adjustments, which are normal and recurring in nature, necessary for fair financial statement presentation. |
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 September 30, 2020, the Company had one finance lease assumed as part of a deed-in-lieu of foreclosure of a hotel property during August 2020. |
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 September 30, 2020, the Company had repaid all outstanding repurchase agreements secured by real estate securities and, therefore, had no required additional collateral posted. The following table provides a reconciliation of cash, cash equivalents and restricted cash in the Company’s consolidated balance sheets to the total amount shown in the Company’s consolidated statements of cash flows: September 30, December 31, 2020 2019 Cash and cash equivalents $ 52,828 $ 37,210 Restricted cash — 429 Total cash, cash equivalents, and restricted cash $ 52,828 $ 37,639 |
Accounting Pronouncements Recently Issued but Not Yet Effective | Accounting Pronouncements Recently Issued but Not Yet Effective 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 changes how entities measure credit losses for financial assets carried at amortized cost. ASU 2016-13 eliminates the requirement that a credit loss must be probable before it can be recognized and instead requires an entity to recognize the current estimate of all expected credit losses. ASU 2016-13 is 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. The Company has elected to use this extension and is continuing to evaluate the impact ASU 2016-13 will have on its allowance for loan losses estimate. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Accounting Policies [Abstract] | |
Reconciliation of Cash, Cash Equivalents and Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash in the Company’s consolidated balance sheets to the total amount shown in the Company’s consolidated statements of cash flows: September 30, December 31, 2020 2019 Cash and cash equivalents $ 52,828 $ 37,210 Restricted cash — 429 Total cash, cash equivalents, and restricted cash $ 52,828 $ 37,639 |
Commercial Mortgage Loans Hel_2
Commercial Mortgage Loans Held for Investment (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Mortgage Loans On Real Estate [Abstract] | |
Schedule of Commercial Mortgage Loans Held for Investment | The tables below show the Company’s commercial mortgage loans held for investment as of September 30, 2020 and December 31, 2019: September 30, 2020 Number of Loans Principal Balance Unamortized (fees)/costs, net Carrying Value Weighted Average Interest Rate Weighted Average Years to Maturity First mortgage loans 26 $ 430,569 $ (325 ) $ 430,244 5.3 % 1.7 Credit loans 3 16,500 — 16,500 9.5 % 5.1 Total and average 29 $ 447,069 $ (325 ) $ 446,744 5.5 % 1.8 December 31, 2019 Number of Loans Principal Balance Unamortized (fees)/costs, net Carrying Value Weighted Average Interest Rate Weighted Average Years to Maturity First mortgage loans 29 $ 489,902 $ (1,700 ) $ 488,202 5.6 % 2.0 Credit loans 3 16,500 — 16,500 9.5 % 5.9 Total and average 32 $ 506,402 $ (1,700 ) $ 504,702 5.7 % 2.2 |
Schedule of Commercial Mortgage Loans held for Investment Portfolio | For the nine months ended September 30, 2020 and the year ended December 31, 2019, the activity in the Company’s commercial mortgage loans, held-for-investment portfolio was as follows: Nine Months Ended September 30, 2020 Year Ended December 31, 2019 Balance at Beginning of Year $ 504,702 $ 249,573 Loan originations 59,990 329,155 Principal repayments (85,080 ) (74,478 ) Amortization of loan origination and deferred exit fees 1,374 2,403 Sale of commercial loan (10,000 ) — Origination fees received on commercial loans — (1,951 ) Provision for loan losses (5,711 ) — Deferred interest capitalized on commercial loan 258 — Transfer on deed-in-lieu of foreclosure to real estate owned (18,789 ) — Balance at End of Period $ 446,744 $ 504,702 |
Schedule of Allowance for Loan Losses | The following table presents the activity in the Company’s allowance for loan losses: Nine Months Ended September 30, 2020 Nine Months Ended September 30, 2019 Beginning of period $ — $ — Provision for loan losses (5,711 ) — Charge-offs 5,711 — Ending allowance for loan losses $ — $ — |
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. |
Real Estate Securities (Tables)
Real Estate Securities (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Investments Debt And Equity Securities [Abstract] | |
Summary of Company's Real Estate Securities | The tables below show the Company’s real estate securities as of September 30, 2020 and December 31, 2019: September 30, 2020 Number of Positions External Credit Rating Collateral Weighted Average Interest Rate Weighted Average Years to Maturity Par Value Amortized Cost Unrealized Gains Unrealized Losses Fair Value 1 BB- Hospitality 3.6 % 0.7 8,500 8,500 — (1,290 ) 7,210 1 B+ Hospitality 3.9 % — 10,000 10,000 — (4,420 ) 5,580 2 3.7 % 0.3 $ 18,500 $ 18,500 $ — $ (5,710 ) $ 12,790 December 31, 2019 Number of Positions External Credit Rating Collateral Weighted Average Interest Rate Weighted Average Years to Maturity Par Value Amortized Cost Unrealized Gains Unrealized Losses Fair Value 3 AAA Hospitality, Office 2.6 % 0.5 $ 19,113 $ 19,081 $ — $ (43 ) $ 19,038 1 AA- Hospitality 2.8 % 0.4 2,000 1,999 — (11 ) 1,988 9 BB- Retail, Hospitality, Mixed Use, Office 4.4 % 1.3 72,052 72,033 104 (81 ) 72,056 1 BBB- Multifamily 3.4 % 1.5 10,000 10,000 — — 10,000 3 Unrated Hospitality 7.0 % 0.7 55,275 54,967 — (180 ) 54,787 17 5.0 % 1.0 $ 158,440 $ 158,080 $ 104 $ (315 ) $ 157,869 |
Repurchase Agreements (Tables)
Repurchase Agreements (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Commercial Mortgage Loans | |
Repurchase Agreement [Line Items] | |
Schedule of Outstanding Repurchase Agreements | The tables below show the Repo Facilities as of September 30, 2020 and December 31, 2019: September 30, 2020 Weighted Average Committed Financing Amount Outstanding (1) Accrued Interest Payable Collateral Pledged Interest Rate Days to Maturity CF Repo Facility $ 250,000 $ 170,598 $ 132 $ 242,577 2.15 % 135 JPM Repo Facility 150,000 130,778 98 187,992 2.07 % 218 $ 400,000 $ 301,376 $ 230 $ 430,569 2.12 % 171 December 31, 2019 Weighted Average Committed Financing Amount Outstanding (1) Accrued Interest Payable Collateral Pledged Interest Rate Days to Maturity CF Repo Facility $ 250,000 $ 224,590 $ 327 $ 304,708 3.74 % 318 JPM Repo Facility 150,000 111,295 157 153,194 3.63 % 492 $ 400,000 $ 335,885 $ 484 $ 457,902 3.70 % 376 (1) Excludes $46 and $80 of unamortized debt issuance costs at September 30, 2020 and December 31, 2019, respectively. |
Real Estate Securities | |
Repurchase Agreement [Line Items] | |
Schedule of Outstanding Repurchase Agreements | The Company entered into two master repurchase agreements f Weighted Average Amount Outstanding Accrued Interest Payable Collateral Pledged Interest Rate Days to Maturity As of September 30, 2020 $ — $ — $ — — — As of December 31, 2019 $ 107,489 $ 168 $ 149,164 3.14 % 11 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
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 classes of common stock, including restricted common stock: Common Stock Nine-months ended September 30, 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 — 8,066 276,250 Distribution reinvestment — 2,310 963 — 477 1,309 Issuance of restricted shares — — — — — — Redemptions (30,518 ) — — — — — Ending balance 10,151,787 653,566 397,251 — 50,081 378,302 Common Stock Nine-months ended September 30, 2019 Class P Class A Class T Class S Class D Class I Beginning balance 5,940,744 — — — — — Issuance of shares 4,315,524 36,227 43,296 — 8,961 9,093 Issuance of restricted shares 2,400 — — — — — Redemptions (21,575 ) — — — — — Ending balance 10,237,093 36,227 43,296 — 8,961 9,093 |
Schedule of Aggregate and Net Distributions Declared for Applicable Class of Common Stock | The table below presents the aggregate and net distributions declared for each applicable class of common stock during the nine-months ended September 30, 2020 and 2019. The table excludes from distribution declaration any month when there were no outstanding shares for a class of stock. Common Stock Nine-months ended September 30, 2020 Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.5398 $ 0.4898 $ 0.4898 $ — $ 0.4898 $ 0.4898 Stockholder servicing fee per share N/A N/A 0.0809 — 0.0237 N/A Net distributions declared per share $ 0.5398 $ 0.4898 $ 0.4089 $ — $ 0.4661 $ 0.4898 Common Stock Nine-months ended September 30, 2019 Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 1.4400 $ 0.1350 $ 0.2700 $ — $ 0.1350 $ 0.2700 Stockholder servicing fee per share N/A N/A 0.0355 — 0.0052 N/A Net distributions declared per share $ 1.4400 $ 0.1350 $ 0.2345 $ — $ 0.1298 $ 0.2700 |
Net (Loss) Income Per Share (Ta
Net (Loss) Income Per Share (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Earnings Per Share [Abstract] | |
Summary of Basic and Diluted Net (Loss) Income Per Share | The following table is a summary of the basic and diluted net (loss) income per share computation for the three and nine-months ended September 30, 2020 and 2019: Three-months ended September 30, Nine-months ended September 30, 2020 2019 2020 2019 Net income (loss) $ 6,056 $ 3,256 $ (30,796 ) $ 9,361 Weighted average shares outstanding, basic 11,630,987 10,116,083 11,537,483 8,407,217 Dilutive effect of restricted stock 444 433 — 233 Weighted average shares outstanding, diluted 11,631,431 10,116,516 11,537,483 8,407,450 Net income (loss) per share, basic and diluted $ 0.52 $ 0.32 $ (2.67 ) $ 1.11 |
Transactions with Related Par_2
Transactions with Related Parties (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Related Party Transactions [Abstract] | |
Summary of Related Party Transactions | The following table summarizes the Company’s related party transactions for the three and nine-months ended September 30, 2020 and 2019 and the amount due to related parties at September 30, 2020 and December 31, 2019: Three-months ended September 30, Nine-months ended September 30, Payable as of September 30, Payable as of December 31, 2020 2019 2020 2019 2020 2019 Organization and offering expense reimbursement (1) $ — $ 61 $ 70 $ 328 $ — $ 17 Selling commissions and dealer manager fee (2) — 1,243 758 6,860 — — Advisory fee (3) 1,572 1,601 3,973 5,086 525 — Loan fees (4) 137 1,070 1,230 1,070 795 408 Accrued stockholder servicing fee (5) — 82 446 82 693 273 Operating expense reimbursement to advisor (6) — — — 5 — — Total $ 1,709 $ 4,057 $ 6,477 $ 13,431 $ 2,013 $ 698 (1) The Company reimbursed the Advisor, the Sub-Advisor and their respective affiliates for costs and other expenses related to the Private Offering, provided that aggregate reimbursements of such costs and expenses did not exceed the organization and offering expenses paid by investors in connection with the sale of Class P Shares in the Private Offering. The Company 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 IPO. For the Private Offering, o (2) The Dealer Manager received selling commissions up to 5%, and a dealer manager fee up to 3%, of the transaction price for each Class P Share sold in the Private Offering, the majority of which was paid to third-party broker-dealers. For the IPO, 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 DRP. (3) Under the Prior Advisory Agreement, the Company paid the Advisor an advisory fee comprised of (1) a fixed component and (2) a performance component. The fixed component of the advisory fee was paid quarterly in arrears in an amount equal to 1/4th of 1.5% of the average aggregate value of the Company’s assets over such quarter, where the value of each asset shall be the value determined in accordance with the Company’s valuation policies or, if such value has not yet been determined, the book value of the asset. The performance component of the advisory fee was calculated and paid annually with respect to the Class P Shares, such that for any year in which the Company’s total return per Class P Share exceeds 7% per annum, the Advisor received 20% of the excess total return allocable to the Class P Shares; provided that in no event did the performance component of the advisory fee exceed 15% of the aggregate total return allocable to Class P Shares for such year. On April 29, 2019, the Company, the Advisor and the Operating Partnership entered into the Advisory Agreement, which superseded and replaced the Prior Advisory Agreement. Pursuant to the Advisory Agreement, (1) the fixed component of the advisory fee is paid in an amount equal to (i) prior to the NAV Pricing Date, 1/4th of 1.5% per annum of the gross value of the Company’s assets, paid quarterly in arrears, and (ii) following the NAV Pricing Date, 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 shall not exceed 1/12th of 2.5% of the Company’s NAV; and (2) 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. For the nine months ended September 30, 2020, the Advisor waived $874 of the fixed component of the advisory fees. ( 4 ) Effective July 17, 2019, 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. ( 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) The Company reimburses 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 does not reimburse overhead costs, including rent and utilities or personnel costs (including salaries, bonuses, benefits and severance payments) and the Company will only reimburse the Advisor for fees payable to its affiliates if they are incurred for legal or marketing services rendered on the Company’s behalf. |
Equity-Based Compensation (Tabl
Equity-Based Compensation (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Summary of Restricted Shares | A summary table of the status of the restricted shares is presented below: Restricted Shares Weighted Average Grant Date Fair Value Per Share Outstanding at December 31, 2019 3,197 $ 25.02 Granted — — Vested (800 ) 25.00 Converted — — Forfeited — — Outstanding at September 30, 2020 2,397 $ 25.03 |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Fair Value Disclosures [Abstract] | |
Financial Instruments Measured on Recurring Basis and Carried at Fair Value in Consolidated Balance Sheets | The following table presents the Company’s financial instruments measured on a recurring basis and carried at fair value in the consolidated balance sheets by their level in the fair value hierarchy (see Note 2 – Summary of Significant Accounting Policies September 30, 2020 December 31, 2019 Total Level I Level II Level III Total Level I Level II Level III Real estate securities $ 12,790 — $ 12,790 — $ 157,869 — $ 157,869 — |
Schedule of Carrying Amount and Estimated Fair Value of Company's Financial Instruments | The following table details the carrying amount and estimated fair value of the Company’s financial instruments at the dates below: September 30, 2020 December 31, 2019 Carrying Amount Estimated Fair Value Carrying Amount Estimated Fair Value Financial assets Cash and cash equivalents $ 52,828 $ 52,828 $ 37,210 $ 37,210 Restricted cash — — 429 429 Commercial mortgage loans, net 446,744 452,415 504,702 511,734 Total $ 499,572 $ 505,243 $ 542,341 $ 549,373 Financial liabilities Repurchase agreements - real estate securities $ — $ — $ 107,489 $ 107,489 Repurchase agreements - commercial mortgage loans 301,330 301,330 335,805 335,805 Total $ 301,330 $ 301,330 $ 443,294 $ 443,294 |
Real Estate Owned (Tables)
Real Estate Owned (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Real Estate [Abstract] | |
Schedule of Company's REO Assets | The following table summarizes the Company’s REO assets as of September 30, 2020: 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 $ 26,683 $ 6,195 $ (122 ) $ 32,756 (1) Refer to Note 2 – Summary of Significant Accounting Policies for useful life of the above assets. (2) Represents assets acquired by the Company by completing a deed-in-lieu of foreclosure transaction. |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Leases [Abstract] | |
Summary of Finance Lease Cost | For the nine months ended September 30, 2020 and 2019, total finance lease cost was comprised as follows: Three-months ended September 30, Nine-months ended September 30, 2020 2019 2020 2019 Amortization of right-of-use assets $ 6 $ — $ 6 $ — Interest on lease liabilities 158 — 158 — Total finance lease cost $ 164 $ — $ 164 $ — |
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 September 30, 2020 and December 31, 2019: September 30, December 31, 2020 2019 Finance lease right of use asset, gross $ 5,549 $ — Accumulated amortization (6 ) — Finance lease right of use asset, net of amortization $ 5,543 $ — |
Schedule of Lease Payments for the Ground Lease | Lease payments for the ground lease as of September 30, 2020 for each of the five succeeding years and thereafter is as follows: Lease Payments 2020 $ 268 2021 1,611 2022 1,611 2023 1,611 2024 1,731 Thereafter 273,377 Total undiscounted lease payments $ 280,209 Less: Amount representing interest (263,492 ) Present value of lease liability $ 16,717 |
Subsequent Events (Tables)
Subsequent Events (Tables) | 9 Months Ended |
Sep. 30, 2020 | |
Subsequent Events [Abstract] | |
Schedule of Authorized Distributions for Class of Common Stock | The Board has authorized distributions for each class of its common stock in the amount per share set forth below: Common Stock Class P Class A Class T Class S Class D Class I Aggregate gross distributions declared per share $ 0.0750 $ 0.0750 $ 0.0750 $ — $ 0.0750 $ 0.0750 Stockholder servicing fee per share N/A N/A 0.0156 — 0.0046 N/A Net distributions declared per share $ 0.0750 $ 0.0750 $ 0.0594 $ — $ 0.0704 $ 0.0750 |
Organization and Business Ope_2
Organization and Business Operations - Additional Information (Details) - USD ($) | Jul. 16, 2019 | Mar. 22, 2019 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Apr. 29, 2019 | Apr. 28, 2019 | Oct. 25, 2016 |
Organization And Business Operations [Line Items] | |||||||||
Advisory agreement date | Oct. 25, 2016 | ||||||||
Common stock shares authorized at $0.001 par per share | $ 3,050,000 | $ 500,000 | |||||||
Issuance of common stock, shares | $ 24,488,000 | $ 24,262,000 | $ 118,804,000 | ||||||
Shares authorized, common stock and preferred stock | 3,050,000,000 | 500,000,000 | |||||||
Preferred Stock | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Shares authorized, preferred stock | 50,000,000 | ||||||||
Maximum | Initial Public Offering | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Issuance of common stock, shares | $ 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 | ||||||||
Issuance of common stock, shares | $ 1,000 | $ 4,000 | |||||||
Shares authorized, common stock | 500,000,000 | 500,000,000 | 500,000,000 | 3,000,000,000 | |||||
Common stock, purchase price per share | $ 25 | ||||||||
Class P Common Stock | Maximum | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Common stock shares authorized at $0.001 par per share | $ 500,000,000 | ||||||||
Class A Common Stock | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Issuance of common stock, shares | $ 1,000 | ||||||||
Shares authorized, common stock | 500,000,000 | 500,000,000 | 500,000,000 | ||||||
Class D Common Stock | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Shares authorized, common stock | 500,000,000 | 500,000,000 | 500,000,000 | ||||||
Class I Common Stock | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Shares authorized, common stock | 500,000,000 | 500,000,000 | 500,000,000 | ||||||
Class S Common Stock | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Shares authorized, common stock | 500,000,000 | 500,000,000 | 500,000,000 | ||||||
Class T Common Stock | |||||||||
Organization And Business Operations [Line Items] | |||||||||
Shares authorized, common stock | 500,000,000 | 500,000,000 | 500,000,000 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Details) | 9 Months Ended |
Sep. 30, 2020 | |
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. |
Buildings and Improvements | Maximum | |
Summary Of Significant Accounting Policies Disclosures [Line Items] | |
REO assets estimated useful lives | 40 years |
Furniture, Fixtures and Equipment | Maximum | |
Summary Of Significant Accounting Policies Disclosures [Line Items] | |
REO assets estimated useful lives | 15 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Reconciliation of Cash, Cash Equivalents and Restricted Cash (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents [Abstract] | ||
Cash and cash equivalents | $ 52,828 | $ 37,210 |
Restricted cash | 429 | |
Total cash, cash equivalents, and restricted cash | $ 52,828 | $ 37,639 |
Commercial Mortgage Loans Hel_3
Commercial Mortgage Loans Held for Investment - Schedule of Commercial Mortgage Loans held for Investment (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020USD ($)Loan | Dec. 31, 2019USD ($)Loan | Dec. 31, 2018USD ($) | |
Mortgage Loans On Real Estate [Line Items] | |||
Number of Loans | Loan | 29 | 32 | |
Principal Balance | $ 447,069 | $ 506,402 | |
Unamortized (fees)/costs, net | (325) | (1,700) | |
Carrying Value | $ 446,744 | $ 504,702 | $ 249,573 |
Weighted Average Interest Rate | 5.50% | 5.70% | |
Weighted Average Years to Maturity | 1 year 9 months 18 days | 2 years 2 months 12 days | |
First Mortgage Loans [Member] | |||
Mortgage Loans On Real Estate [Line Items] | |||
Number of Loans | Loan | 26 | 29 | |
Principal Balance | $ 430,569 | $ 489,902 | |
Unamortized (fees)/costs, net | (325) | (1,700) | |
Carrying Value | $ 430,244 | $ 488,202 | |
Weighted Average Interest Rate | 5.30% | 5.60% | |
Weighted Average Years to Maturity | 1 year 8 months 12 days | 2 years | |
Credit Loans [Member] | |||
Mortgage Loans On Real Estate [Line Items] | |||
Number of Loans | Loan | 3 | 3 | |
Principal Balance | $ 16,500 | $ 16,500 | |
Carrying Value | $ 16,500 | $ 16,500 | |
Weighted Average Interest Rate | 9.50% | 9.50% | |
Weighted Average Years to Maturity | 5 years 1 month 6 days | 5 years 10 months 24 days |
Commercial Mortgage Loans Hel_4
Commercial Mortgage Loans Held for Investment - Schedule of Commercial Mortgage Loans held for Investment Portfolio (Details) - USD ($) $ in Thousands | 1 Months Ended | 9 Months Ended | 12 Months Ended |
May 31, 2020 | Sep. 30, 2020 | Dec. 31, 2019 | |
Mortgage Loans On Real Estate [Abstract] | |||
Balance at Beginning of Year | $ 504,702 | $ 249,573 | |
Loan originations | 59,990 | 329,155 | |
Principal repayments | (85,080) | (74,478) | |
Amortization of loan origination and deferred exit fees | 1,374 | 2,403 | |
Sale of commercial loan | $ (10,000) | (10,000) | |
Origination fees received on commercial loans | (1,951) | ||
Provision for loan losses | (5,711) | ||
Deferred interest capitalized on commercial loan | 258 | ||
Transfer on deed-in-lieu of foreclosure to real estate owned | (18,789) | ||
Balance at End of Period | $ 446,744 | $ 504,702 |
Commercial Mortgage Loans Hel_5
Commercial Mortgage Loans Held for Investment - Additional Information (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
May 31, 2020USD ($)Loan | Apr. 30, 2020Loan | Sep. 30, 2020USD ($) | Sep. 30, 2020USD ($)LoanRating | Dec. 31, 2019LoanRating | Jun. 30, 2020USD ($) | |
Mortgage Loans On Real Estate [Line Items] | ||||||
Commercial mortgage loans sold amount | $ 10,000 | $ 10,000 | ||||
Proceeds from sale of mortgage loans held for investment | 9,625 | |||||
Realized loss on sale of commercial mortgage loan | $ 375 | 375 | ||||
Interest income for impaired loans | $ 0 | $ 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 | 19 | 30 | ||||
Number of loans risk rated three | Loan | 7 | 2 | ||||
Number of loans risk rated four | Loan | 3 | |||||
Number of loans modified on hospitality property | Loan | 1 | |||||
Credit Loans [Member] | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Number of loans sold | Loan | 1 | |||||
Credit Loans [Member] | Florida [Member] | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Allowance for loan loss | 0 | $ 0 | $ 1,500 | |||
First Mortgage Loans [Member] | Illinois [Member] | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Impairment charges on loans | $ 5,711 | |||||
Number of loans impaired | Loan | 1 | |||||
First Mortgage Loans [Member] | Florida [Member] | ||||||
Mortgage Loans On Real Estate [Line Items] | ||||||
Provision for loan loss reversed | $ 1,500 |
Commercial Mortgage Loans Hel_6
Commercial Mortgage Loans Held for Investment - Schedule of Allowance for Loan Losses (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Mortgage Loans On Real Estate [Abstract] | |
Provision for loan losses | $ (5,711) |
Charge-offs | $ 5,711 |
Commercial Mortgage Loans Hel_7
Commercial Mortgage Loans Held for Investment - Summary of Investment Grade of Loans Loss (Details) - Commercial Mortgage Loans | 9 Months Ended |
Sep. 30, 2020 | |
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 - Summar
Real Estate Securities - Summary of Company's Real Estate Securities (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020USD ($)Investment | Dec. 31, 2019USD ($)Investment | |
Schedule Of Available For Sale Securities [Line Items] | ||
Real estate securities at fair value | $ 12,790,000 | $ 157,869,000 |
Real Estate Securities | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Number of Positions | Investment | 2 | 17 |
Weighted Average Interest Rate | 3.70% | 5.00% |
Weighted Average Years to Maturity | 3 months 18 days | 1 year |
Par Value | $ 18,500,000 | $ 158,440,000 |
Amortized Cost | 18,500,000 | 158,080,000 |
Unrealized Gains | 104,000 | |
Unrealized Losses | (5,710,000) | (315,000) |
Real estate securities at fair value | $ 12,790,000 | $ 157,869,000 |
Real Estate Securities | AAA | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Number of Positions | Investment | 3 | |
Collateral | Hospitality, Office | |
Weighted Average Interest Rate | 2.60% | |
Weighted Average Years to Maturity | 6 months | |
Par Value | $ 19,113,000 | |
Amortized Cost | 19,081,000 | |
Unrealized Losses | (43,000) | |
Real estate securities at fair value | $ 19,038,000 | |
Real Estate Securities | AA- | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Number of Positions | Investment | 1 | |
Collateral | Hospitality | |
Weighted Average Interest Rate | 2.80% | |
Weighted Average Years to Maturity | 4 months 24 days | |
Par Value | $ 2,000,000 | |
Amortized Cost | 1,999,000 | |
Unrealized Losses | (11,000) | |
Real estate securities at fair value | $ 1,988,000 | |
Real Estate Securities | BB- | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Number of Positions | Investment | 1 | 9 |
Collateral | Hospitality | Retail, Hospitality, Mixed Use, Office |
Weighted Average Interest Rate | 3.60% | 4.40% |
Weighted Average Years to Maturity | 8 months 12 days | 1 year 3 months 18 days |
Par Value | $ 8,500,000 | $ 72,052,000 |
Amortized Cost | 8,500,000 | 72,033,000 |
Unrealized Gains | 104,000 | |
Unrealized Losses | (1,290,000) | (81,000) |
Real estate securities at fair value | $ 7,210,000 | $ 72,056,000 |
Real Estate Securities | B+ | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Number of Positions | Investment | 1 | |
Collateral | Hospitality | |
Weighted Average Interest Rate | 3.90% | |
Weighted Average Years to Maturity | 0 years | |
Par Value | $ 10,000,000 | |
Amortized Cost | 10,000,000 | |
Unrealized Losses | (4,420,000) | |
Real estate securities at fair value | $ 5,580,000 | |
Real Estate Securities | BBB- | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Number of Positions | Investment | 1 | |
Collateral | Multifamily | |
Weighted Average Interest Rate | 3.40% | |
Weighted Average Years to Maturity | 1 year 6 months | |
Par Value | $ 10,000,000 | |
Amortized Cost | 10,000,000 | |
Real estate securities at fair value | $ 10,000,000 | |
Real Estate Securities | Unrated | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Number of Positions | Investment | 3 | |
Collateral | Hospitality | |
Weighted Average Interest Rate | 7.00% | |
Weighted Average Years to Maturity | 8 months 12 days | |
Par Value | $ 55,275,000 | |
Amortized Cost | 54,967,000 | |
Unrealized Losses | (180,000) | |
Real estate securities at fair value | $ 54,787,000 |
Real Estate Securities - Additi
Real Estate Securities - Additional Information (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2020USD ($)Investment | Sep. 30, 2020USD ($)Investment | Sep. 30, 2019USD ($) | Dec. 31, 2019USD ($)Investment | |
Schedule Of Available For Sale Securities [Line Items] | ||||
Carrying value of investments | $ 12,790 | $ 12,790 | $ 157,869 | |
Real estate securities sold | $ 96,453 | $ 9,211 | ||
Number of commercial mortgage backed securities rated three | Investment | 1 | |||
Number of commercial mortgage backed securities rated five | Investment | 1 | |||
Number of commercial mortgage backed securities rated two | Investment | 17 | |||
Real Estate Securities | ||||
Schedule Of Available For Sale Securities [Line Items] | ||||
Number of investments | Investment | 2 | 2 | 17 | |
Carrying value of investments | $ 12,790 | $ 12,790 | $ 157,869 | |
Net unrealized loss | 5,710 | $ 211 | ||
Realized loss | 9,930 | 29,218 | 43 | |
Real estate securities sold | $ 52,525 | $ 96,453 | $ 9,211 |
Repurchase Agreements - Additio
Repurchase Agreements - Additional Information (Details) | May 06, 2019USD ($) | Mar. 31, 2020USD ($) | Sep. 30, 2020USD ($)Agreement | Jun. 30, 2020USD ($) | Dec. 31, 2019USD ($) | Jan. 31, 2019USD ($) | Aug. 31, 2018USD ($) | Feb. 15, 2018USD ($) |
Real Estate Securities | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Number of master repurchase agreements | Agreement | 2 | |||||||
Borrowings under repurchase agreements | $ 0 | $ 107,489,000 | ||||||
CF Repo Facility | Commercial Mortgage Loans | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Repurchase agreement, maximum advance amount | $ 300,000,000 | $ 250,000,000 | $ 250,000,000 | $ 175,000,000 | $ 100,000,000 | |||
Extended maturity date | 2021-02 | |||||||
Borrowings under repurchase agreements | $ 170,598,000 | 224,590,000 | ||||||
CF Repo Facility | Commercial Mortgage Loans | London Interbank Offered Rate | ||||||||
Repurchase Agreement [Line Items] | ||||||||
LIBOR spread | 2.00% | |||||||
JP Morgan Repo Facility | Commercial Mortgage Loans | ||||||||
Repurchase Agreement [Line Items] | ||||||||
Repurchase agreement, maximum advance amount | $ 150,000,000 | |||||||
Initial maturity date | May 6, 2021 | |||||||
Line of credit facility successive term option to extension period, description | two successive one-year extensions | |||||||
Borrowings under repurchase agreements | $ 130,778,000 | $ 111,295,000 | ||||||
JP Morgan Repo Facility | Commercial Mortgage Loans | London Interbank Offered Rate | Minimum [Member] | ||||||||
Repurchase Agreement [Line Items] | ||||||||
LIBOR spread | 1.75% | |||||||
JP Morgan Repo Facility | Commercial Mortgage Loans | London Interbank Offered Rate | Maximum | ||||||||
Repurchase Agreement [Line Items] | ||||||||
LIBOR spread | 2.50% |
Repurchase Agreements - Schedul
Repurchase Agreements - Schedule of Outstanding Repurchase Agreements (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2020 | Dec. 31, 2019 | |
Assets Sold Under Agreements To Repurchase [Line Items] | ||
Accrued Interest Payable | $ 230,000 | $ 652,000 |
Real Estate Securities | ||
Assets Sold Under Agreements To Repurchase [Line Items] | ||
Amount Outstanding | $ 0 | 107,489,000 |
Accrued Interest Payable | 168,000 | |
Collateral Pledged | $ 149,164,000 | |
Weighted Average Interest Rate | 3.14% | |
Weighted Average Days to Maturity | 0 days | 11 days |
CF Repo Facility | Commercial Mortgage Loans | ||
Assets Sold Under Agreements To Repurchase [Line Items] | ||
Committed Financing | $ 250,000,000 | $ 250,000,000 |
Amount Outstanding | 170,598,000 | 224,590,000 |
Accrued Interest Payable | 132,000 | 327,000 |
Collateral Pledged | $ 242,577,000 | $ 304,708,000 |
Weighted Average Interest Rate | 2.15% | 3.74% |
Weighted Average Days to Maturity | 135 days | 318 days |
JPM Repo Facility | Commercial Mortgage Loans | ||
Assets Sold Under Agreements To Repurchase [Line Items] | ||
Committed Financing | $ 150,000,000 | $ 150,000,000 |
Amount Outstanding | 130,778,000 | 111,295,000 |
Accrued Interest Payable | 98,000 | 157,000 |
Collateral Pledged | $ 187,992,000 | $ 153,194,000 |
Weighted Average Interest Rate | 2.07% | 3.63% |
Weighted Average Days to Maturity | 218 days | 492 days |
Repo Facility | Commercial Mortgage Loans | ||
Assets Sold Under Agreements To Repurchase [Line Items] | ||
Committed Financing | $ 400,000,000 | $ 400,000,000 |
Amount Outstanding | 301,376,000 | 335,885,000 |
Accrued Interest Payable | 230,000 | 484,000 |
Collateral Pledged | $ 430,569,000 | $ 457,902,000 |
Weighted Average Interest Rate | 2.12% | 3.70% |
Weighted Average Days to Maturity | 171 days | 376 days |
Repurchase Agreements - Sched_2
Repurchase Agreements - Schedule of Outstanding Repurchase Agreements (Parenthetical) (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Commercial Mortgage Loans | Repo Facility | ||
Assets Sold Under Agreements To Repurchase [Line Items] | ||
Unamortized debt issuance costs | $ 46 | $ 80 |
Stockholders' Equity - Schedule
Stockholders' Equity - Schedule of Change in Outstanding Shares Including Restricted Common Stock (Details) - shares | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Class P Common Stock | ||
Class Of Stock [Line Items] | ||
Beginning balance | 10,182,305 | 5,940,744 |
Issuance of shares | 4,315,524 | |
Issuance of restricted shares | 2,400 | |
Redemptions | (30,518) | (21,575) |
Ending balance | 10,151,787 | 10,237,093 |
Class A Common Stock | ||
Class Of Stock [Line Items] | ||
Beginning balance | 272,006 | |
Issuance of shares | 379,250 | 36,227 |
Distribution reinvestment | 2,310 | |
Ending balance | 653,566 | 36,227 |
Class T Common Stock | ||
Class Of Stock [Line Items] | ||
Beginning balance | 121,718 | |
Issuance of shares | 274,570 | 43,296 |
Distribution reinvestment | 963 | |
Ending balance | 397,251 | 43,296 |
Class S Common Stock | ||
Class Of Stock [Line Items] | ||
Beginning balance | 0 | |
Ending balance | 0 | |
Class D Common Stock | ||
Class Of Stock [Line Items] | ||
Beginning balance | 41,538 | |
Issuance of shares | 8,066 | 8,961 |
Distribution reinvestment | 477 | |
Ending balance | 50,081 | 8,961 |
Class I Common Stock | ||
Class Of Stock [Line Items] | ||
Beginning balance | 100,743 | |
Issuance of shares | 276,250 | 9,093 |
Distribution reinvestment | 1,309 | |
Ending balance | 378,302 | 9,093 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 7 Months Ended | ||||||
Jul. 31, 2019 | Sep. 30, 2020 | Aug. 31, 2020 | Jul. 31, 2020 | Feb. 29, 2020 | Dec. 31, 2019 | Sep. 30, 2019 | |
Class Of Stock [Line Items] | |||||||
Distributions payable | $ 866 | $ 1,699 | $ 1,650 | ||||
Class P Common Stock | |||||||
Class Of Stock [Line Items] | |||||||
Daily distribution amount | $ 0.005260274 | ||||||
Annualized gross distribution per share | $ 1.92 | $ 1.92 | |||||
Gross monthly distribution amount | 0.16 | ||||||
Class A Common Stock | |||||||
Class Of Stock [Line Items] | |||||||
Annualized gross distribution per share | 1.62 | ||||||
Gross monthly distribution amount | 0.135 | ||||||
Class T Common Stock | |||||||
Class Of Stock [Line Items] | |||||||
Annualized gross distribution per share | 1.62 | ||||||
Gross monthly distribution amount | 0.135 | ||||||
Class D Common Stock | |||||||
Class Of Stock [Line Items] | |||||||
Annualized gross distribution per share | 1.62 | ||||||
Gross monthly distribution amount | 0.135 | ||||||
Class I Common Stock | |||||||
Class Of Stock [Line Items] | |||||||
Annualized gross distribution per share | 1.62 | ||||||
Gross monthly distribution amount | $ 0.135 | ||||||
Common Class P A T S D I | |||||||
Class Of Stock [Line Items] | |||||||
Annualized gross distribution per share | $ 0.90 | $ 0.88 | $ 0.8576 | ||||
Gross monthly distribution amount | $ 0.075 | $ 0.073 | $ 0.071 |
Stockholders' Equity - Schedu_2
Stockholders' Equity - Schedule of Aggregate and Net Distributions Declared for Applicable Class of Common Stock (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Class P Common Stock | ||
Distributions Declared [Line Items] | ||
Aggregate gross distributions declared per share | $ 0.5398 | $ 1.4400 |
Net distributions declared per share | 0.5398 | 1.4400 |
Class A Common Stock | ||
Distributions Declared [Line Items] | ||
Aggregate gross distributions declared per share | 0.4898 | 0.1350 |
Net distributions declared per share | 0.4898 | 0.1350 |
Class T Common Stock | ||
Distributions Declared [Line Items] | ||
Aggregate gross distributions declared per share | 0.4898 | 0.2700 |
Stockholder servicing fee per share | 0.0809 | 0.0355 |
Net distributions declared per share | 0.4089 | 0.2345 |
Class D Common Stock | ||
Distributions Declared [Line Items] | ||
Aggregate gross distributions declared per share | 0.4898 | 0.1350 |
Stockholder servicing fee per share | 0.0237 | 0.0052 |
Net distributions declared per share | 0.4661 | 0.1298 |
Class I Common Stock | ||
Distributions Declared [Line Items] | ||
Aggregate gross distributions declared per share | 0.4898 | 0.2700 |
Net distributions declared per share | $ 0.4898 | $ 0.2700 |
Net (Loss) Income Per Share - A
Net (Loss) Income Per Share - Additional information (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Antidilutive restricted shares | 0 | 0 | 285 | 0 |
Net (Loss) Income Per Share - S
Net (Loss) Income Per Share - Summary of Basic and Diluted Net (Loss) Income Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Earnings Per Share [Abstract] | ||||
Net income (loss) | $ 6,056 | $ 3,256 | $ (30,796) | $ 9,361 |
Weighted average shares outstanding, basic | 11,630,987 | 10,116,083 | 11,537,483 | 8,407,217 |
Dilutive effect of restricted stock | 444 | 433 | 233 | |
Weighted average shares outstanding, diluted | 11,631,431 | 10,116,516 | 11,537,483 | 8,407,450 |
Net income (loss) per share, basic and diluted | $ 0.52 | $ 0.32 | $ (2.67) | $ 1.11 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) $ in Thousands | Sep. 30, 2020USD ($)Loan | Dec. 31, 2019USD ($)Loan |
Commitments And Contingencies Disclosure [Abstract] | ||
Number of commercial real estate loans | Loan | 20 | 22 |
Commercial real estate, remaining future funding commitment | $ | $ 53,890 | $ 54,620 |
Segment Reporting - Additional
Segment Reporting - Additional Information (Details) - Segment | 9 Months Ended | |
Sep. 30, 2020 | Sep. 30, 2019 | |
Segment Reporting [Abstract] | ||
Number of reportable segment | 1 | 1 |
Transactions with Related Par_3
Transactions with Related Parties - Additional Information (Details) - USD ($) | 1 Months Ended | 9 Months Ended | |||
Nov. 30, 2016 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | Jul. 16, 2019 | |
Related Party Transaction [Line Items] | |||||
Proceeds from issuance of common stock | $ 24,261,000 | $ 118,804,000 | |||
Class P Common Stock | |||||
Related Party Transaction [Line Items] | |||||
Common stock, shares, issued | 10,151,787 | 10,182,305 | |||
Common stock, purchase price per share | $ 25 | ||||
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 | ||||
Common stock, purchase price per share | $ 25 | ||||
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 Company’s 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 SRP prior to the fifth anniversary of the date on which such Class P 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 | ||||
Common stock, purchase price per share | $ 25 | ||||
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 Company’s sub-advisor, (i) it will not be eligible to submit a request for the repurchase of these 120,000 Class P Shares pursuant to the SRP prior to the fifth anniversary of the date on which such Class P Shares were purchased (November 2021); and (ii) 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. |
Transactions with Related Par_4
Transactions with Related Parties - Summary of Related Party Transactions (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Dec. 31, 2019 | |
Related Party Transaction [Line Items] | |||||
Advisory fee | $ 1,572 | $ 1,601 | $ 3,973 | $ 5,086 | |
Accrued stockholder servicing fee | 420 | 82 | |||
Total, payable | 2,013 | 2,013 | $ 698 | ||
Advisor | |||||
Related Party Transaction [Line Items] | |||||
Organization and offering expense reimbursement | 61 | 70 | 328 | ||
Selling commissions and dealer manager fee | 1,243 | 758 | 6,860 | ||
Advisory fee | 1,572 | 1,601 | 3,973 | 5,086 | |
Loan fees | 137 | 1,070 | 1,230 | 1,070 | |
Accrued stockholder servicing fee | 82 | 446 | 82 | ||
Operating expense reimbursement to advisor | 5 | ||||
Total | 1,709 | $ 4,057 | 6,477 | $ 13,431 | |
Organization and offering expense reimbursement, payable | 17 | ||||
Advisory fee, payable | 525 | 525 | |||
Loan fees, payable | 795 | 795 | 408 | ||
Accrued stockholder servicing fee, payable | 693 | 693 | 273 | ||
Total, payable | $ 2,013 | $ 2,013 | $ 698 |
Transactions with Related Par_5
Transactions with Related Parties - Summary of Related Party Transactions (Parenthetical) (Details) - Advisor - USD ($) $ in Thousands | Jul. 17, 2019 | Jul. 16, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2020 | Apr. 28, 2019 |
Related Party Transaction [Line Items] | |||||||
Maximum percentage of gross proceeds from issuance of initial public offering | 15.00% | ||||||
Percentage of average aggregate value of assets - Prior Advisory Agreement | 1.50% | ||||||
Percentage of excess total return | 20.00% | 20.00% | 20.00% | ||||
Percentage of gross value of assets, paid quarterly | 0.375% | ||||||
Percentage of gross value of assets, paid monthly | 0.104% | ||||||
Fixed component of advisory fees waived | $ 874 | ||||||
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 and Class I Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of upfront selling commission | 0.00% | ||||||
Percentage of upfront dealer manager fee | 0.00% | ||||||
Class D Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Aggregate percentage of stockholder servicing fees on net asset value | 0.25% | ||||||
Initial Public Offering | 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 | 15.00% | 15.00% | |||||
Percentage of net asset value of assets, paid monthly | 0.208% | ||||||
Maximum | Private Offering | Class P Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of selling commission | 5.00% | ||||||
Percentage of dealer manager fee | 3.00% | ||||||
Maximum | Initial Public Offering | Class A Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of upfront selling commission | 6.00% | ||||||
Percentage of upfront dealer manager fee | 1.25% | ||||||
Percentage of participation dealers fee | 7.25% | ||||||
Maximum | Initial Public Offering | Class T Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of upfront selling commission | 3.00% | ||||||
Percentage of participation dealers fee | 3.50% | ||||||
Maximum | Initial Public Offering | Class S Common Stock | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of upfront selling commission | 3.50% | ||||||
Minimum [Member] | |||||||
Related Party Transaction [Line Items] | |||||||
Minimum percentage to earn performance component of advisory fee | 7.00% | 7.00% |
Equity-Based Compensation - Add
Equity-Based Compensation - Additional Information (Details) | Dec. 02, 2019USD ($)Director$ / sharesshares | Jan. 07, 2019USD ($)Director$ / sharesshares | Mar. 01, 2018USD ($)Director$ / sharesshares | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2020USD ($) | Sep. 30, 2019USD ($)shares |
RSP | Restricted Shares | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Fair value of restricted shares at vesting date | $ | $ 0 | $ 0 | $ 17,000 | $ 10,000 | |||
RSP | Restricted Shares | Independent Directors | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Vesting period | 3 years | ||||||
Compensation expense | $ | 8,000 | $ 5,000 | $ 23,000 | $ 15,000 | |||
Unrecognized compensation cost | $ | $ 38,000 | $ 38,000 | |||||
Weighted average remaining period that compensation expense recognizable | 1 year 3 months 14 days | ||||||
Class P Common Stock | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 2,400 | ||||||
Class P Common Stock | RSP | Restricted Shares | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of independent directors | Director | 3 | 3 | |||||
Grant date fair value of restricted shares | $ / shares | $ 25 | $ 25 | |||||
Restricted shares value | $ | $ 30,000 | $ 30,000 | |||||
Restricted shares description | These restricted Class P Shares vest in equal one-third increments on January 7, 2020, 2021 and 2022 | These restricted Class P Shares vest in equal one-third increments on March 1, 2019, 2020 and 2021 | |||||
Class P Common Stock | RSP | Restricted Shares | Year 1 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Restricted shares award vest percentage | 33.33% | 33.33% | |||||
Class P Common Stock | RSP | Restricted Shares | Year 2 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Restricted shares award vest percentage | 33.33% | 33.33% | |||||
Class P Common Stock | RSP | Restricted Shares | Year 3 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Restricted shares award vest percentage | 33.33% | 33.33% | |||||
Class P Common Stock | RSP | Restricted Shares | Independent Director One | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 400 | 400 | |||||
Class P Common Stock | RSP | Restricted Shares | Independent Director Two | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 400 | 400 | |||||
Class P Common Stock | RSP | Restricted Shares | Independent Director Three | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 400 | 400 | |||||
Class P Common Stock | RSP | Restricted Shares | Independent Directors | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 1,200 | 1,200 | |||||
Class I Common Stock | RSP | Restricted Shares | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of independent directors | Director | 3 | ||||||
Grant date fair value of restricted shares | $ / shares | $ 25.07 | ||||||
Restricted shares value | $ | $ 30,000 | ||||||
Restricted shares description | The restricted Class I shares vest in equal one-third increments on December 2, 2020, 2021 and 2022 | ||||||
Class I Common Stock | RSP | Restricted Shares | Year 1 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Restricted shares award vest percentage | 33.33% | ||||||
Class I Common Stock | RSP | Restricted Shares | Year 2 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Restricted shares award vest percentage | 33.33% | ||||||
Class I Common Stock | RSP | Restricted Shares | Year 3 | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Restricted shares award vest percentage | 33.33% | ||||||
Class I Common Stock | RSP | Restricted Shares | Independent Director One | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 399 | ||||||
Class I Common Stock | RSP | Restricted Shares | Independent Director Two | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 399 | ||||||
Class I Common Stock | RSP | Restricted Shares | Independent Director Three | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 399 | ||||||
Class I Common Stock | RSP | Restricted Shares | Independent Directors | |||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |||||||
Number of restricted shares | 1,197 |
Equity-Based Compensation - Sum
Equity-Based Compensation - Summary of the Restricted Shares (Details) - Restricted Shares | 9 Months Ended |
Sep. 30, 2020$ / sharesshares | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | |
Outstanding beginning balance, Shares | shares | 3,197 |
Vested, Shares | shares | (800) |
Outstanding ending balance, Shares | shares | 2,397 |
Outstanding beginning balance, Weighted average grant date fair value per share | $ / shares | $ 25.02 |
Vested, Weighted average grant date fair value per share | $ / shares | 25 |
Outstanding ending balance, Weighted average grant date fair value per share | $ / shares | $ 25.03 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Financial Instruments Measured on Recurring Basis and Carried at Fair Value in Consolidated Balance Sheets (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Real estate securities at fair value | $ 12,790 | $ 157,869 |
Fair Value Measurements, Recurring | Real Estate Securities | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Real estate securities at fair value | 12,790 | 157,869 |
Fair Value Measurements, Recurring | Real Estate Securities | Level II | ||
Fair Value Assets And Liabilities Measured On Recurring And Nonrecurring Basis [Line Items] | ||
Real estate securities at fair value | $ 12,790 | $ 157,869 |
Fair Value of Financial Instr_4
Fair Value of Financial Instruments - Additional Information (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2020 | Sep. 30, 2019 | Sep. 30, 2020 | Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | ||||
Fair value assets transfers from level 1 to level 2 amount | $ 0 | $ 0 | $ 0 | $ 0 |
Fair value assets transfers from level 2 to level 1 amount | 0 | 0 | 0 | 0 |
Fair value assets transfers to level 3 amount | 0 | 0 | 0 | 0 |
Fair value assets transfers out of level 3 amount | $ 0 | $ 0 | $ 0 | $ 0 |
Fair Value of Financial Instr_5
Fair Value of Financial Instruments - Schedule of Carrying Amount and Estimated Fair Value of Company's Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Dec. 31, 2019 |
Carrying Amount | ||
Financial assets | ||
Cash and cash equivalents | $ 52,828 | $ 37,210 |
Restricted cash | 429 | |
Commercial mortgage loans, net | 446,744 | 504,702 |
Total | 499,572 | 542,341 |
Financial liabilities | ||
Total | 301,330 | 443,294 |
Carrying Amount | Real Estate Securities | ||
Financial liabilities | ||
Repurchase agreements | 107,489 | |
Carrying Amount | Commercial Mortgage Loans | ||
Financial liabilities | ||
Repurchase agreements | 301,330 | 335,805 |
Estimated Fair Value | ||
Financial assets | ||
Cash and cash equivalents | 52,828 | 37,210 |
Restricted cash | 429 | |
Commercial mortgage loans, net | 452,415 | 511,734 |
Total | 505,243 | 549,373 |
Financial liabilities | ||
Total | 301,330 | 443,294 |
Estimated Fair Value | Real Estate Securities | ||
Financial liabilities | ||
Repurchase agreements | 107,489 | |
Estimated Fair Value | Commercial Mortgage Loans | ||
Financial liabilities | ||
Repurchase agreements | $ 301,330 | $ 335,805 |
Real Estate Owned - Schedule of
Real Estate Owned - Schedule of Company's REO Assets (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2020USD ($) | |
Real Estate [Line Items] | |
Real Estate Owned, Net | $ 32,756 |
Hotel | Chicago, IL | |
Real Estate [Line Items] | |
Acquisition Date | 2020-08 |
Building and Improvements | $ 26,683 |
Furniture, Fixtures and Equipment | 6,195 |
Accumulated Depreciation | (122) |
Real Estate Owned, Net | $ 32,756 |
Leases - Additional Information
Leases - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2020 | 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. 1, 1999 | |
Finance lease, expiration date | Mar. 31, 2098 | |
Finance lease liability | $ 16,717 | $ 16,827 |
Finance lease, right of use asset | $ 5,549 | $ 5,549 |
Finance lease liability, interest rate | 11.37% | |
Lessee finance lease termination description | Company may terminate the lease as of March 31, 2049, March 31, 2065 and March 31, 2081 |
Leases - Summary of Finance Lea
Leases - Summary of Finance Lease Cost (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2020 | Sep. 30, 2020 | |
Leases [Abstract] | ||
Amortization of right-of-use assets | $ 6 | $ 6 |
Interest on lease liabilities | 158 | 158 |
Total finance lease cost | $ 164 | $ 164 |
Leases - Schedule of Finance Le
Leases - Schedule of Finance Lease Right of Use Asset, Net of Amortization (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Aug. 20, 2020 |
Leases [Abstract] | ||
Finance lease right of use asset, gross | $ 5,549 | $ 5,549 |
Accumulated amortization | (6) | |
Finance lease right of use asset, net of amortization | $ 5,543 |
Leases - Schedule of Lease Paym
Leases - Schedule of Lease Payments for the Ground Lease (Details) - USD ($) $ in Thousands | Sep. 30, 2020 | Aug. 20, 2020 |
Leases [Abstract] | ||
2020 | $ 268 | |
2021 | 1,611 | |
2022 | 1,611 | |
2023 | 1,611 | |
2024 | 1,731 | |
Thereafter | 273,377 | |
Total undiscounted lease payments | 280,209 | |
Less: Amount representing interest | (263,492) | |
Present value of lease liability | $ 16,717 | $ 16,827 |
Subsequent Events - Schedule of
Subsequent Events - Schedule of Authorized Distributions for Class of Common Stock (Details) - $ / shares | Oct. 30, 2020 | Sep. 30, 2020 | Sep. 30, 2019 |
Class P Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | $ 0.5398 | $ 1.4400 | |
Class A Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | 0.4898 | 0.1350 | |
Class T Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | 0.4898 | 0.2700 | |
Stockholder servicing fee per share | 0.0809 | 0.0355 | |
Class D Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | 0.4898 | 0.1350 | |
Stockholder servicing fee per share | 0.0237 | 0.0052 | |
Class I Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | $ 0.4898 | $ 0.2700 | |
Subsequent Event | Class P Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | $ 0.0750 | ||
Net distributions declared per share | 0.0750 | ||
Subsequent Event | Class A Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | 0.0750 | ||
Net distributions declared per share | 0.0750 | ||
Subsequent Event | Class T Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | 0.0750 | ||
Stockholder servicing fee per share | 0.0156 | ||
Net distributions declared per share | 0.0594 | ||
Subsequent Event | Class D Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | 0.0750 | ||
Stockholder servicing fee per share | 0.0046 | ||
Net distributions declared per share | 0.0704 | ||
Subsequent Event | Class I Common Stock | |||
Subsequent Event [Line Items] | |||
Aggregate gross distributions declared per share | 0.0750 | ||
Net distributions declared per share | $ 0.0750 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - Subsequent Event - Common Stock | Oct. 30, 2020 |
Subsequent Event [Line Items] | |
Distributions record date | Oct. 31, 2020 |
Distributions payable date | Nov. 18, 2020 |