Cottonwood Communities 10-Q 14 May 20 2020 Q1 Quarterly report Financial data

Cover Page

Cover Page - shares	3 Months Ended
	Mar. 31, 2020	May 11, 2020
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Mar. 31, 2020
Document Transition Report	false
Entity File Number	000-56165
Entity Registrant Name	Cottonwood Communities, Inc.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	61-1805524
Entity Address, Address Line One	6340 South 3000 East
Entity Address, Address Line Two	Suite 500
Entity Address, City or Town	Salt Lake City
Entity Address, State or Province	UT
Entity Address, Postal Zip Code	84121
City Area Code	801
Local Phone Number	278-0700
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
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 Central Index Key	0001692951
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false
Class A
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		10,491,466
Class T
Document Information [Line Items]
Entity Common Stock, Shares Outstanding		17,503

Condensed Consolidated Balance

Condensed Consolidated Balance Sheets - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Assets
Real estate assets, net	$ 167,022,743	$ 63,905,651
Investment in unconsolidated real estate entity	10,412,901	4,961,868
Real estate note investment, net	3,788,418	2,059,309
Cash and cash equivalents	6,305,913	47,549,804
Restricted cash	188,408	192,190
Other assets	480,974	707,524
Total assets	188,199,357	119,376,346
Liabilities
Credit facilities, net	84,643,956	34,990,146
Preferred stock, net	7,867,788	809,478
Related party payables	555,416	287,561
Accounts payable, accrued expenses and other liabilities	1,832,150	992,689
Total liabilities	94,899,310	37,079,874
Commitments and contingencies (Note 11)
Stockholders' equity
Common Stock, Value, Issued	101,565	88,518
Additional paid-in capital	100,937,646	87,973,949
Accumulated distributions	(3,552,711)	(2,369,592)
Accumulated deficit	(4,186,453)	(3,396,403)
Total stockholders' equity	93,300,047	82,296,472
Total liabilities and stockholders' equity	$ 188,199,357	$ 119,376,346
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	1,000,000,000	1,000,000,000
Common stock, shares issued (in shares)	10,156,471	8,851,759
Common stock, shares outstanding (in shares)	10,156,471	8,851,759

Condensed Consolidated Balanc_2

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 31, 2020	Dec. 31, 2019
Statement of Financial Position [Abstract]
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	1,000,000,000	1,000,000,000
Common stock, shares issued (in shares)	10,156,471	8,851,759
Common stock, shares outstanding (in shares)	10,156,471	8,851,759

Condensed Consolidated Statemen

Condensed Consolidated Statements of Operations - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues
Rental and other property revenues	$ 1,539,577	$ 0
Real estate note investment interest	71,715	0
Total revenues	1,611,292	0
Expenses
Property operations expense	655,284	0
Reimbursable operating expenses to related parties	236,509	125,000
Asset management fee to related party	449,653	19,783
Depreciation and amortization	843,984	0
General and administrative expenses	230,361	118,160
Total operating expenses	2,415,791	262,943
Other (expense) income
Income (Loss) from Equity Method Investments	240,096	0
Interest income	184,884	31,432
Interest expense	(537,971)	0
Nonoperating Income (Expense), Total	(112,991)	31,432
Total expenses before asset management fee waiver	(2,528,782)	(231,511)
Asset management fee waived by Advisor	127,440	0
Net expenses after asset management fee waiver	(2,401,342)	(231,511)
Net loss	$ (790,050)	$ (231,511)
Weighted-average shares outstanding (in shares)	9,483,288	876,743
Net loss per common share - basic and diluted (in dollars per share)	$ (0.08)	$ (0.26)

Condensed Consolidated Statem_2

Condensed Consolidated Statements of Stockholders' Equity - USD ($)	Total	Common Stock	Additional Paid-In Capital	Accumulated Distributions	Accumulated Deficit
Shares outstanding, beginning balance (in shares) at Dec. 31, 2018		366,654
Stockholders' equity, beginning balance at Dec. 31, 2018	$ 3,565,691	$ 3,667	$ 3,662,233	$ 0	$ (100,209)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)		1,523,319
Issuance of common stock	15,201,915	$ 15,233	15,186,682
Distributions to investors	(58,045)			(58,045)
Net loss	(231,511)				(231,511)
Shares outstanding, ending balance (in shares) at Mar. 31, 2019		1,889,973
Stockholders' equity, ending balance at Mar. 31, 2019	$ 18,478,050	$ 18,900	18,848,915	(58,045)	(331,720)
Shares outstanding, beginning balance (in shares) at Dec. 31, 2019	8,851,759	8,851,759
Stockholders' equity, beginning balance at Dec. 31, 2019	$ 82,296,472	$ 88,518	87,973,949	(2,369,592)	(3,396,403)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Issuance of common stock (in shares)		1,304,712
Issuance of common stock	12,976,744	$ 13,047	12,963,697
Distributions to investors	(1,183,119)			(1,183,119)
Net loss	$ (790,050)				(790,050)
Shares outstanding, ending balance (in shares) at Mar. 31, 2020	10,156,471	10,156,471
Stockholders' equity, ending balance at Mar. 31, 2020	$ 93,300,047	$ 101,565	$ 100,937,646	$ (3,552,711)	$ (4,186,453)

Condensed Consolidated Statem_3

Condensed Consolidated Statements of Cash Flows - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash flows from operating activities:
Net loss	$ (790,050)	$ (231,511)
Adjustments to reconcile net loss to net cash provided by (used in) operating activities:
Depreciation and amortization	843,984	0
Equity in earnings	(240,096)	0
Amortization of real estate note investment issuance cost	12,110	0
Amortization of debt issuance costs	37,331	0
Noncash interest expense on preferred stock	42,047	0
Changes in operating assets and liabilities:
Other assets	37,550	22,980
Related party payables	267,855	160,460
Accounts payable, accrued expenses and other liabilities	361,147	28,622
Net cash provided by (used in) operating activities	571,878	(19,449)
Cash flows from investing activities:
Acquisitions of real estate	(53,904,597)	(1,000,000)
Capital improvements to real estate	(18,674)	0
Investment in unconsolidated real estate entity	(5,210,937)	0
Issuance of real estate note investment including issuance costs	(1,741,219)	0
Net cash used in investing activities	(60,875,427)	(1,000,000)
Cash flows from financing activities:
Proceeds from issuance of preferred stock, net of issuance costs	7,016,263	0
Proceeds from issuance of common stock	12,928,418	15,123,227
Distributions to common stockholders	(888,805)	(40,024)
Net cash provided by financing activities	19,055,876	15,083,203
Net (decrease) increase in cash and cash equivalents and restricted cash	(41,247,673)	14,063,754
Cash and cash equivalents and restricted cash, beginning of period	47,741,994	3,406,175
Cash and cash equivalents and restricted cash, end of period	6,494,321	17,469,929
Reconciliation of cash and cash equivalents and restricted cash to the condensed consolidated balance sheets:
Total cash and cash equivalents and restricted cash	6,494,321	17,469,929
Supplemental disclosure of non-cash investing and financing activities:
Credit facility entered into in conjunction with acquisition of real estate	$ 49,616,479	$ 0

Organization and Business

Organization and Business	3 Months Ended
	Mar. 31, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Business	Organization and Business Cottonwood Communities, Inc. is a Maryland corporation formed to invest in multifamily apartment communities and real estate related assets located throughout the United States. The Company intends to qualify as a real estate investment trust or REIT beginning with the taxable year ending December 31, 2019. The Company holds real estate interests and conducts its business through its operating partnership, Cottonwood Communities O.P., LP (the “Operating Partnership”). Unless the context indicates otherwise, the “Company,” “we,” “our” or “us” refers to Cottonwood Communities, Inc. and its consolidated subsidiaries, including the Operating Partnership. We are externally managed and have no employees. CC Advisors III, LLC is our advisor. Cottonwood Communities Management, LLC is the property manager for our stabilized multifamily apartment communities. We are offering $750,000,000 in shares of common stock (the “Offering”), made up of $675,000,000 in shares through our primary offering and $75,000,000 in shares through our distribution reinvestment plan (the "DRP Program”) at a purchase price of $10.00 per share (with discounts available to certain categories of purchasers in the primary offering) in both offerings. Our common stock has two classes, Class A and Class T. The share classes have a different selling commission structure; however, these offering-related expenses are being paid by our advisor without reimbursement by us. We are offering to sell any combination of Class A and Class T common stock in the Offering, with a dollar value up to the maximum offering amount. We are also offering a maximum of $50,000,000 in shares of Series 2019 Preferred Stock to accredited investors at a purchase price of $10.00 per share (the "Private Offering"). Offering-related expenses in the Private Offering are paid by us. At March 31, 2020, we owned multifamily apartment communities in West Palm Beach, Florida and the Greater Boston, Massachusetts area; have issued a B Note secured by a deed of trust on a multifamily development project in Allen, Texas; have made a preferred equity investment in a multifamily development project in Ybor City, Florida; and have entered into an agreement to provide a preferred equity investment for a multifamily development project in Denver, Colorado. COVID-19 Pandemic Currently, one of the most significant risks and uncertainties facing the Company and the real estate industry generally is the potential adverse effect of the ongoing public health crisis of the novel coronavirus disease (COVID-19) pandemic. The extent to which the COVID-19 pandemic impacts the Company’s operations, the personal financial position of its tenants and the development projects in which it has invested will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. See Note 1 2 , “Subsequent Events” for a further discussion on the COVID-19 pandemic.

Summary of Significant Accounti

Summary of Significant Accounting Policies	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
Summary of Significant Accounting Policies	Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The condensed consolidated financial statements, including the condensed notes thereto, are unaudited and exclude some of the disclosures required in audited financial statements. The condensed consolidated balance sheet as of December 31, 2019 has been derived from the Company’s audited financial statements as of that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments and eliminations, consisting only of normal recurring adjustments necessary for a fair presentation in conformity with GAAP. The accompanying condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the period ending December 31, 2019 filed with the SEC. The accompanying condensed consolidated financial statements include the accounts of the Company and its subsidiaries for which we have a controlling interest. All intercompany balances and transactions have been eliminated in consolidation.

Real Estate Assets, Net

Real Estate Assets, Net	3 Months Ended
	Mar. 31, 2020
Business Combinations [Abstract]
Real Estate Assets, Net	Real Estate Assets, Net The following table summarizes the carrying amounts of our consolidated real estate assets: March 31, 2020 December 31, 2019 Building and building improvements $ 134,630,792 $ 52,466,583 Land and land improvements 28,182,025 10,658,155 Furniture, fixtures and equipment 3,983,344 2,015,778 Intangible assets 3,808,756 1,503,325 170,604,917 66,643,841 Less: Accumulated depreciation and amortization (3,582,174) (2,738,190) Real estate assets, net $ 167,022,743 $ 63,905,651 Asset acquisition On March 19, 2020, we acquired Cottonwood One Upland (formerly "One Upland"), a multifamily community in the Greater Boston area for $103,600,000, excluding closing costs. We funded the purchase with an initial draw of $50,000,000 from our new $67,600,000 credit facility and proceeds from our offerings. Acquired assets and liabilities were recorded at relative fair value as an asset acquisition. The following table summarizes the purchase price allocation of Cottonwood One Upland: Allocated Amounts Property Building Land Land Improvements Personal Property Intangible Total Cottonwood One Upland $ 82,145,536 $ 14,514,535 $ 3,009,335 $ 1,967,566 $ 2,305,430 $ 103,942,402

Investment in Unconsolidated Re

Investment in Unconsolidated Real Estate	3 Months Ended
	Mar. 31, 2020
Real Estate [Abstract]
Investment in Unconsolidated Real Estate	Investment in Unconsolidated Real Estate During the three months ended March 31, 2020, we contributed approximately $5,211,000 to our joint venture with Milhaus, LLC for the development of Lector85, a 254-unit multifamily project in Ybor City, Florida. This constituted the remaining amount of our $9,900,000 commitment. We recorded equity in earnings of $240,096 from the Lector85 Investment for the three months ended March 31, 2020 under the hypothetical liquidation book value method.

Real Estate Note Investment

Real Estate Note Investment	3 Months Ended
	Mar. 31, 2020
Real Estate [Abstract]
Real Estate Note Investment	Investment in Unconsolidated Real Estate During the three months ended March 31, 2020, we contributed approximately $5,211,000 to our joint venture with Milhaus, LLC for the development of Lector85, a 254-unit multifamily project in Ybor City, Florida. This constituted the remaining amount of our $9,900,000 commitment. We recorded equity in earnings of $240,096 from the Lector85 Investment for the three months ended March 31, 2020 under the hypothetical liquidation book value method.

Credit Facility

Credit Facility	3 Months Ended
	Mar. 31, 2020
Debt Disclosure [Abstract]
Credit Facility	Credit Facilities We have a credit facility agreement with Berkadia Commercial Mortgage, LLC (the "Berkadia Credit Facility"), for which we have an advance of $35,995,000 secured by Cottonwood West Palm. The advance matures on May 30, 2029 and can be prepaid subject to certain fees and conditions. There is no limit on the amount that we can draw on the Berkadia Credit Facility so long as we maintain the loan-to-value ratio and other requirements set forth in the loan documents. On March 19, 2020, in conjunction with the acquisition of Cottonwood One Upland, we entered a secured revolving credit facility agreement with J.P. Morgan Chase Bank, N.A., an unaffiliated lender (the “JP Morgan Credit Facility”). Pursuant to the terms of the JP Morgan Credit Facility, we may obtain advances secured against Cottonwood One Upland up to the amount of $67,600,000, subject to certain debt service coverage ratio requirements. Upon the closing of Cottonwood One Upland, our initial advance was $50,000,000. The JP Morgan Credit Facility has an initial maturity date of March 19, 2023 with the option to extend for two one-year periods subject to the satisfaction of certain conditions set forth in the loan agreement. The advances will carry an interest-only term and bear floating interest rates of 1-month LIBOR plus a spread ranging from 1.50% to 1.75%, depending on certain debt yield metrics set forth in the loan agreement and as evidenced by a promissory note. We have the right to prepay all or a portion of the JP Morgan Credit Facility at any time subject to certain conditions contained in the loan documents. We may finance other future acquisitions through the JP Morgan Credit Facility. The aggregate loan-to-value ratio for all advances made with respect to the JP Morgan Credit Facility cannot exceed 65% at the time any advance is made. The limit on the amount that we can borrow under the JP Morgan Credit Facility is $125,000,000 so long as we maintain the loan-to-value and debt coverage ratios, and other requirements set forth in the JP Morgan Credit Facility loan documents. Each advance will be cross-collateralized with the other advances. The JP Morgan Credit Facility permits us to sell the multifamily apartment communities that are secured by the JP Morgan Credit Facility individually provided that certain loan-to-value and debt coverage ratios, and other requirements, are met. We were in compliance with all covenants associated with our outstanding credit facilities as of March 31, 2020.

Fair Value of Financial Instrum

Fair Value of Financial Instruments	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Fair Value of Financial Instruments	Fair Value of Financial Instruments We estimate the fair value of our financial instruments using available market information and valuation methodologies we believe to be appropriate. As of March 31, 2020 and December 31, 2019, the fair values of cash and cash equivalents, restricted cash, other assets, related party payables, and accounts payable, accrued expenses and other liabilities approximate their carrying values due to the short-term nature of these instruments. Fair value measurements are determined based on the assumptions that market participants would use in pricing the asset or liability. Fair value measurements are categorized into one of three levels of the fair value hierarchy based on the lowest level of significant input used. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. Our assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the asset or liability. Considerable judgment and a high degree of subjectivity are involved in developing these estimates. These estimates may differ from the actual amounts that we could realize upon settlement. The fair value hierarchy is as follows: Level 1 - Quoted (unadjusted) prices in active markets for identical assets or liabilities. Level 2 - Other observable inputs, either directly or indirectly, other than quoted prices included in Level 1, including: • Quoted prices for similar assets/liabilities in active markets; • Quoted prices for identical or similar assets/liabilities in non-active markets (e.g., few transactions, limited information, non-current prices, high variability over time); • Inputs other than quoted prices that are observable for the asset/liability (e.g., interest rates, yield curves, volatilities, default rates); and • Inputs that are derived principally from or corroborated by other observable market data. Level 3 - Unobservable inputs that cannot be corroborated by observable market data. The table below includes the carrying value and fair value for our financial instruments for which it is practicable to estimate fair value: As of March 31, 2020 As of December 31, 2019 Carrying Value Fair Value Carrying Value Fair Value Financial Asset: Real estate note investment $ 3,481,848 $ 3,481,848 $ 1,793,771 $ 1,793,771 Financial Liability: Berkadia Credit Facility $ 35,995,000 $ 37,230,000 $ 35,995,000 $ 37,410,000 JP Morgan Credit Facility $ 50,000,000 $ 50,000,000 $ — $ — Series 2019 Preferred Stock $ 9,096,328 $ 9,096,328 $ 1,198,000 $ 1,198,000

Preferred Stock

Preferred Stock	3 Months Ended
	Mar. 31, 2020
Equity [Abstract]
Preferred Stock	Preferred Stock The Series 2019 Preferred Stock has a fixed redemption date and is classified as a liability on the condensed consolidated balance sheet. Dividends to preferred stockholders, paid at an annual rate of 5.5% are classified as interest expense on the condensed consolidated statement of operations. During the three months ended March 31, 2020 we raised approximately $7,898,000 of Series 2019 Preferred stock and incurred approximately $61,000 in dividends. We had 913,399 and 119,800 shares of Series 2019 Preferred stock outstanding as of March 31, 2020 and December 31, 2019, respectively.

Stockholders' Equity

Stockholders' Equity	3 Months Ended
	Mar. 31, 2020
Equity [Abstract]
Stockholders' Equity	Stockholders' Equity During the three months ended March 31, 2020 and 2019 we raised approximately $12,977,000 and $15,402,000 of common stock and paid approximately $889,000 and $40,000 in distributions to common stockholders, respectively. As of March 31, 2020, we had 10,156,471 of common stock outstanding, of which 10,153,971 was Class A common stock and 2,500 was Class T common stock. On March 16, 2020, our board of directors declared distributions on the outstanding shares of our common stock based on daily record dates for the period from March 1, 2020 to May 31, 2020 at a rate of $0.00136612 per share per day. LTIP Unit Awards On March 25, 2020, we amended the agreement of our Operating Partnership effective February 1, 2020 to establish LTIP Units, a new series of partnership units, and to permit the admission of additional limited partners. We also entered into LTIP Unit Award Agreements with certain executive officers and a person associated with the dealer manager for our Offering, awarding 12,438 time-based LTIP Units and a target total of 37,312 performance-based LTIP Units. The time-based LTIP Units vest over a four The number of units was awarded at the estimated value per share of our common stock of $10.00. Time based LTIP Units, whether vested or unvested, receive the same distribution per unit as common stockholders. Performance based LTIP units receive 10% of that amount per unit on the total target units during the performance period, whereupon the participant receives an additional grant of LTIP Units the equivalent of 90% of distributions that would have been paid on the earned units during the performance period. Share based compensation for these awards during the three months ended March 31, 2020 was not significant.

Related-Party Transactions

Related-Party Transactions	3 Months Ended
	Mar. 31, 2020
Related Party Transactions [Abstract]
Related-Party Transactions	Related-Party Transactions Asset management fees to our advisor for the three months ended March 31, 2020 and 2019 were $449,653 and $19,783, respectively. Asset management fees waived by our advisor during the three months ended March 31, 2020 were $127,440. No asset management fees were waived during the three months ended March 31, 2019. Acquisition expenses reimbursed to our advisor for the three months ended March 31, 2020 and 2019 were not significant, as we have generally incurred and paid such expenses directly. Reimbursable company operating expenses to our advisor or its affiliates for the three months ended March 31, 2020 and 2019 were $236,509 and $125,000, respectively. Property management fees to our property manager for the three months ended March 31, 2020 were $54,030. No property management fees were incurred for the three months ended March 31, 2019.

Economic Dependency

Economic Dependency	3 Months Ended
	Mar. 31, 2020
Related Party Transactions [Abstract]
Economic Dependency	Related-Party Transactions Asset management fees to our advisor for the three months ended March 31, 2020 and 2019 were $449,653 and $19,783, respectively. Asset management fees waived by our advisor during the three months ended March 31, 2020 were $127,440. No asset management fees were waived during the three months ended March 31, 2019. Acquisition expenses reimbursed to our advisor for the three months ended March 31, 2020 and 2019 were not significant, as we have generally incurred and paid such expenses directly. Reimbursable company operating expenses to our advisor or its affiliates for the three months ended March 31, 2020 and 2019 were $236,509 and $125,000, respectively. Property management fees to our property manager for the three months ended March 31, 2020 were $54,030. No property management fees were incurred for the three months ended March 31, 2019.

Commitments and Contingencies

Commitments and Contingencies	3 Months Ended
	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Commitments and Contingencies	Commitments and Contingencies Dolce B Note As of March 31, 2020, we had a remaining commitment of up to approximately $6,518,000 on the Dolce B-Note. 2980 Huron Investment On October 25, 2019, we entered into a joint venture to provide $20,000,000 of preferred equity in an entity that has purchased and intends to develop 0.84 acres in the Union Station North neighborhood in downtown Denver, Colorado (the "2980 Huron Project"). We expect construction on the 2980 Huron Project to commence in summer 2020 and to be completed in late 2022. Our contributions will only be made following the contribution of the full $17,500,000 of common equity by our joint venture partner, and then will be made as project costs are incurred. As of March 31, 2020, no draws have been made on our $20,000,000 commitment. Pursuant to the joint venture agreement our obligation to advance the funds for our preferred equity membership interest is subject to the satisfaction of certain conditions, including but not limited to the closing of the Huron Secured Loan with terms and conditions as approved by us; the execution of certain construction documents with the selection of a general contractor for the Huron Project as reasonably approved by us; approval of a site plan for the Huron Project as approved by us, the lender for the Huron Secured Loan and the City and County of Denver, Colorado; the delivery of certain documentation to us by the Huron Developer and other parties related to the Huron Project. We can provide no assurance that these conditions will be met and that we will ultimately advance funds for the 2980 Huron Investment. Litigation As of March 31, 2020, we were not subject to any material litigation nor were we aware of any material litigation threatened against us. Distribution Reinvestment Plan We have adopted a distribution reinvestment plan whereby stockholders may elect to have us apply their dividends and other distributions to the purchase of additional shares of common stock. Participants in the plan will acquire common stock at the per share price effective on the date of purchase (currently $10.00). Share Repurchase Programs Series 2019 Preferred Stock Upon the request of a holder of Series 2019 Preferred Stock, we may, at the sole discretion of the board of directors, repurchase their shares at the following prices, which are dependent on how long a redeeming stockholder has held each share: Share Purchase Anniversary Repurchase Price Less than 1 year $ 8.80 1 year $ 9.00 2 years $ 9.20 3 years $ 9.40 4 years $ 9.60 5 years $ 9.80 A stockholder’s death or complete disability, 2 years or more $ 10.00 No Series 2019 Preferred Stock shares were redeemed during the three months ended March 31, 2020. Common Stock Our board of directors has adopted a share repurchase program that permits holders of common stock to request, on a quarterly basis, that we repurchase all or any portion of their shares. We may choose to repurchase all, some or none of the shares that have been requested to be repurchased at our discretion, subject to limitations in the share repurchase plan. The total amount of aggregate repurchased shares will be limited to 5% of the weighted average number of shares of common stock outstanding during the prior calendar year. In addition, during any calendar year, we may redeem only the number of shares that we could purchase with the amount of net proceeds from the sale of shares under our distribution reinvestment plan during the prior calendar year. The repurchase price is subject to the following discounts, depending on how long a redeeming stockholder has held each share: Share Purchase Anniversary Repurchase Price as a Percentage of Estimated Value (1) Less than 1 year No repurchase allowed 1 year - 2 years 85 % 3 years - 4 years 90 % 5 years and thereafter 95 % A stockholder’s death or complete disability, less than 2 years 95 % A stockholder’s death or complete disability, 2 years or more 100 % (1) For the purposes of the share repurchase program, the “estimated value per share” will initially be equal to the purchase price per share at which the original purchaser or purchasers of the shares bought its shares from us, and the purchase price per share will be adjusted to reflect any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares outstanding. No shares were redeemed during the three months ended March 31, 2020 and 2019.

Subsequent Events

Subsequent Events	3 Months Ended
	Mar. 31, 2020
Subsequent Events [Abstract]
Subsequent Events	Subsequent EventsWe evaluate subsequent events up until the date the condensed consolidated financial statements are issued and have determined there are none to be reported or disclosed in the condensed consolidated financial statements other than those mentioned below. Status of the Private Offering As of May 11, 2020, we had sold 1,063,994 shares of Series 2019 Preferred Stock for aggregate gross offering proceeds of $10,602,279. In connection with the sale of these shares in the Private Offering, the Company paid aggregate selling commissions of $701,359 and placement fees of $206,843. Status of the Offering As of May 11, 2020, we had sold 10,491,466 shares of our Class A common stock and 17,503 shares of our Class T common stock in the Offering for aggregate gross offering proceeds of $104,547,764. Included in these amounts were 81,907 shares of common stock sold pursuant to the DRP Program for aggregate gross offering proceeds of $819,068. Dividends Paid - Series 2019 Preferred Stock Subsequent to March 31, 2020 and through the date of this report, we paid $80,346 of dividends to holders of record of Series 2019 Preferred Stock at an effective annual rate of 5.5% on the $10.00 purchase price, assuming distributions are paid every day for a year at the daily distribution rate. Dividends Declared - Series 2019 Preferred Stock On May 12, 2020, our board of directors declared cash distributions at a daily distribution rate of $0.00150273, or 5.5% annually on the $10.00 purchase price, to holders of record of our Series 2019 Preferred Stock for the months of June, July and August 2020. Distributions Paid - Common Stock Subsequent to March 31, 2020 and through the date of this report, we paid $844,366 of distributions to our common stockholders at an effective annual rate of 5.0% on the $10.00 purchase price, assuming distributions are paid every day for a year at the daily distribution rate. Distributions Declared - Common Stock On May 12, 2020, our board of directors declared cash distributions at a daily distribution rate of $0.00136612, or 5.0% annually on the $10.00 purchase price, to holders of record of our common stock for the month of June 2020. Our board of directors will evaluate the continued payment of future monthly distributions in response to the uncertainty caused by the COVID-19 pandemic on a month-by-month basis. Holders of our common stock may choose to receive cash distributions or purchase additional shares through our distribution reinvestment plan. COVID-19 Pandemic We are closely monitoring the impact of the COVID-19 pandemic on all aspects of our business, including how the pandemic will impact our tenants and multifamily apartment communities. While we did not incur significant disruptions from the COVID-19 pandemic during the three months ended March 31, 2020, since mid-March, a small percentage of tenants have requested rent deferral as a result of the pandemic, and therefore, we are unable to predict the impact that the pandemic will have on our financial condition, results of operations and cash flows due to numerous uncertainties . We are evaluating each tenant rent relief request on an individual basis, considering a number of factors. Not all tenant requests will ultimately result in modified agreements, nor are we forgoing our contractual rights under our lease agreements. The extent to which the COVID-19 pandemic impacts our operations, the personal financial position of our tenants, and the multifamily apartment communities and development projects in which we have invested will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others.

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Policies)	3 Months Ended
	Mar. 31, 2020
Accounting Policies [Abstract]
Basis of Presentation	Basis of Presentation The accompanying condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) and pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) for interim financial information and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The condensed consolidated financial statements, including the condensed notes thereto, are unaudited and exclude some of the disclosures required in audited financial statements. The condensed consolidated balance sheet as of December 31, 2019 has been derived from the Company’s audited financial statements as of that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the accompanying condensed consolidated financial statements contain all adjustments and eliminations, consisting only of normal recurring adjustments necessary for a fair presentation in conformity with GAAP. The accompanying condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for the period ending December 31, 2019 filed with the SEC.
Organization and Offering Costs	Organization and Offering CostsAll organization and offering costs in connection with the offering of our common stock are paid by our advisor. We will not incur any liability for or reimburse our advisor for any of these organizational and offering costs. As of March 31, 2020, our advisor incurred approximately $11,707,000 in organizational and offering costs from the issuance of common stock.

Real Estate Assets, Net (Tables

Real Estate Assets, Net (Tables)	3 Months Ended
	Mar. 31, 2020
Business Combinations [Abstract]
Summary of Carrying Amounts of Consolidated Real Estate Assets	The following table summarizes the carrying amounts of our consolidated real estate assets: March 31, 2020 December 31, 2019 Building and building improvements $ 134,630,792 $ 52,466,583 Land and land improvements 28,182,025 10,658,155 Furniture, fixtures and equipment 3,983,344 2,015,778 Intangible assets 3,808,756 1,503,325 170,604,917 66,643,841 Less: Accumulated depreciation and amortization (3,582,174) (2,738,190) Real estate assets, net $ 167,022,743 $ 63,905,651
Summary of Purchase Price Allocation of Real Estate Assets Acquired	The following table summarizes the purchase price allocation of Cottonwood One Upland: Allocated Amounts Property Building Land Land Improvements Personal Property Intangible Total Cottonwood One Upland $ 82,145,536 $ 14,514,535 $ 3,009,335 $ 1,967,566 $ 2,305,430 $ 103,942,402

Fair Value of Financial Instr_2

Fair Value of Financial Instruments (Tables)	3 Months Ended
	Mar. 31, 2020
Fair Value Disclosures [Abstract]
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis	The table below includes the carrying value and fair value for our financial instruments for which it is practicable to estimate fair value: As of March 31, 2020 As of December 31, 2019 Carrying Value Fair Value Carrying Value Fair Value Financial Asset: Real estate note investment $ 3,481,848 $ 3,481,848 $ 1,793,771 $ 1,793,771 Financial Liability: Berkadia Credit Facility $ 35,995,000 $ 37,230,000 $ 35,995,000 $ 37,410,000 JP Morgan Credit Facility $ 50,000,000 $ 50,000,000 $ — $ — Series 2019 Preferred Stock $ 9,096,328 $ 9,096,328 $ 1,198,000 $ 1,198,000

Commitments and Contingencies (

Commitments and Contingencies (Tables)	3 Months Ended
	Mar. 31, 2020
Commitments and Contingencies Disclosure [Abstract]
Schedule of Repurchase Program Discounts	Upon the request of a holder of Series 2019 Preferred Stock, we may, at the sole discretion of the board of directors, repurchase their shares at the following prices, which are dependent on how long a redeeming stockholder has held each share: Share Purchase Anniversary Repurchase Price Less than 1 year $ 8.80 1 year $ 9.00 2 years $ 9.20 3 years $ 9.40 4 years $ 9.60 5 years $ 9.80 A stockholder’s death or complete disability, 2 years or more $ 10.00 The repurchase price is subject to the following discounts, depending on how long a redeeming stockholder has held each share: Share Purchase Anniversary Repurchase Price as a Percentage of Estimated Value (1) Less than 1 year No repurchase allowed 1 year - 2 years 85 % 3 years - 4 years 90 % 5 years and thereafter 95 % A stockholder’s death or complete disability, less than 2 years 95 % A stockholder’s death or complete disability, 2 years or more 100 % (1) For the purposes of the share repurchase program, the “estimated value per share” will initially be equal to the purchase price per share at which the original purchaser or purchasers of the shares bought its shares from us, and the purchase price per share will be adjusted to reflect any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares outstanding.

Organization and Business (Deta

Organization and Business (Details)	3 Months Ended
	Mar. 31, 2020USD ($)employeeclass$ / shares	May 14, 2020$ / shares	May 12, 2020$ / shares
Subsidiary, Sale of Stock [Line Items]
Number of employees | employee	0
IPO
Subsidiary, Sale of Stock [Line Items]
Aggregate value of shares offered (up to) | $	$ 750,000,000
Number of classes of stock | class	2
IPO | Subsequent event
Subsidiary, Sale of Stock [Line Items]
Share price (in dollars per share) | $ / shares			$ 10
Primary Offering
Subsidiary, Sale of Stock [Line Items]
Aggregate value of shares offered (up to) | $	$ 675,000,000
Distribution Reinvestment Plan
Subsidiary, Sale of Stock [Line Items]
Aggregate value of shares offered (up to) | $	$ 75,000,000
Share price (in dollars per share) | $ / shares	$ 10
Distribution Reinvestment Plan | Subsequent event
Subsidiary, Sale of Stock [Line Items]
Share price (in dollars per share) | $ / shares			$ 10
Private Placement
Subsidiary, Sale of Stock [Line Items]
Aggregate value of shares offered (up to) | $	$ 50,000,000
Private Placement | Subsequent event
Subsidiary, Sale of Stock [Line Items]
Share price (in dollars per share) | $ / shares		$ 10

Summary of Significant Accoun_3

Summary of Significant Accounting Policies (Details)	Mar. 31, 2020USD ($)
Cottonwood Communities Management, LLC | Common Stock
Subsidiary, Sale of Stock [Line Items]
Offering costs incurred	$ 11,707,000

Real Estate Assets, Net (Detail

Real Estate Assets, Net (Details) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Business Combinations [Abstract]
Building and building improvements	$ 134,630,792	$ 52,466,583
Land and land improvements	28,182,025	10,658,155
Furniture, fixtures and equipment	3,983,344	2,015,778
Intangible assets	3,808,756	1,503,325
Real estate investment property, at cost	170,604,917	66,643,841
Less: Accumulated depreciation and amortization	(3,582,174)	(2,738,190)
Real estate assets, net	$ 167,022,743	$ 63,905,651

Real Estate Assets, Net - Asset

Real Estate Assets, Net - Asset Acquisitions (Details) - USD ($)	May 30, 2019	Mar. 31, 2020	Dec. 31, 2019
Business Acquisition [Line Items]
Payment for asset acquisition		$ 103,600,000
JP Morgan Credit Facility | Carrying Value
Business Acquisition [Line Items]
Lines of credit, fair value disclosure		50,000,000	$ 0
Credit facility entered into in conjunction with acquisition of real estate		$ 67,600,000
Luma
Business Acquisition [Line Items]
Building	$ 82,145,536
Land	14,514,535
Land Improvements	3,009,335
Personal Property	1,967,566
Intangible	2,305,430
Total	$ 103,942,402
Weighted-average amortization period	6 months

Investment in Unconsolidated _2

Investment in Unconsolidated Real Estate (Details) - Lector85 - Corporate Joint Venture	3 Months Ended
	Mar. 31, 2020USD ($)
Real Estate [Line Items]
Investment income, interest	$ 240,096
Preferred Equity Investment
Real Estate [Line Items]
Investment, face amount, issued	5,211,000
Amount of investment	$ 9,900,000

Real Estate Note Investment (De

Real Estate Note Investment (Details) - B Note	3 Months Ended
	Mar. 31, 2020USD ($)
Real Estate [Line Items]
Notes issued	$ 1,688,000
Investment owned, face amount	10,000,000
Additional financing	3,482,000
Investment income, interest	$ 71,715

Credit Facility (Details)

Credit Facility (Details) - JP Morgan Credit Facility	3 Months Ended
	Mar. 31, 2020USD ($)
Line of Credit Facility [Line Items]
Loan-to-value ratio, maximum	65.00%
Line of credit facility, maximum borrowing capacity	$ 125,000,000
Minimum | 1-month LIBOR
Line of Credit Facility [Line Items]
Basis spread on variable rate	1.50%
Maximum | 1-month LIBOR
Line of Credit Facility [Line Items]
Basis spread on variable rate	1.75%

Fair Value of Financial Instr_3

Fair Value of Financial Instruments (Details) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Carrying Value
Financial Asset:
Real estate note investment	$ 3,481,848	$ 1,793,771
Financial Liability:
Series 2019 Preferred Stock	9,096,328	1,198,000
Carrying Value | Berkadia Credit Facility
Financial Liability:
Lines of credit, fair value disclosure	35,995,000	35,995,000
Carrying Value | JP Morgan Credit Facility
Financial Liability:
Lines of credit, fair value disclosure	50,000,000	0
Fair Value
Financial Asset:
Real estate note investment	3,481,848	1,793,771
Financial Liability:
Series 2019 Preferred Stock	9,096,328	1,198,000
Fair Value | Berkadia Credit Facility
Financial Liability:
Lines of credit, fair value disclosure	37,230,000	37,410,000
Fair Value | JP Morgan Credit Facility
Financial Liability:
Lines of credit, fair value disclosure	$ 50,000,000	$ 0

Preferred Stock (Details)

Preferred Stock (Details) - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2018
Subsidiary, Sale of Stock [Line Items]
Proceeds from issuance of preferred stock, net of issuance costs	$ 7,016,263	$ 0
2019 Preferred Stock
Subsidiary, Sale of Stock [Line Items]
Preferred stock, annualized rate	5.50%
Proceeds from issuance of preferred stock, net of issuance costs	$ 7,898,000
Distributions	$ 61,000
Preferred stock, shares outstanding (in shares)	913,399		119,800

Stockholders' Equity (Details)

Stockholders' Equity (Details) - USD ($)	Mar. 25, 2020	Mar. 16, 2020	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Subsidiary, Sale of Stock [Line Items]
Proceeds from issuance of common stock, accrual basis			$ (12,977,000)	$ (15,402,000)
Distributions paid in cash			$ 888,805	$ 40,024
Common stock, shares outstanding (in shares)			10,156,471		8,851,759
Common stock, dividend rate (in dollars per share)		$ 0.00136612
Share-based Payment Arrangement, Tranche Two [Member]
Subsidiary, Sale of Stock [Line Items]
Time-based LTIP units annual vesting percentage	25.00%
Share-based Payment Arrangement, Tranche Three [Member]
Subsidiary, Sale of Stock [Line Items]
Time-based LTIP units annual vesting percentage	25.00%
Share-based Payment Arrangement, Tranche Four [Member]
Subsidiary, Sale of Stock [Line Items]
Time-based LTIP units annual vesting percentage	25.00%
Long Term Incentive Plan [Member]
Subsidiary, Sale of Stock [Line Items]
Share price	$ 10
Performance Shares [Member] | Long Term Incentive Plan [Member]
Subsidiary, Sale of Stock [Line Items]
Number of equity instruments other than options awarded	37,312
Percent of amount per unit on total target units	10.00%
Percent of distributions that would have been paid out	90.00%
Time Based Shares [Member] | Long Term Incentive Plan [Member]
Subsidiary, Sale of Stock [Line Items]
Number of equity instruments other than options awarded	12,438
Time-based LTIP units vesting period	4 years
Time Based Shares [Member] | Long Term Incentive Plan [Member] | Share-based Payment Arrangement, Tranche One [Member]
Subsidiary, Sale of Stock [Line Items]
Time-based LTIP units annual vesting percentage	25.00%
Class A
Subsidiary, Sale of Stock [Line Items]
Common stock, shares outstanding (in shares)			10,153,971
Class T
Subsidiary, Sale of Stock [Line Items]
Common stock, shares outstanding (in shares)			2,500

Related-Party Transactions (Det

Related-Party Transactions (Details) - Affiliated Entity - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Related Party Transaction [Line Items]
Operating expenses, reimbursable	$ 236,509	$ 125,000
Cottonwood Communities Management, LLC
Related Party Transaction [Line Items]
Asset management fees	449,653	19,783
Asset management fees waived	127,440	0
Property management fees	$ 54,030	$ 0

Commitments and Contingencies -

Commitments and Contingencies - Narrative (Details)	3 Months Ended
	Mar. 31, 2020USD ($)$ / sharesshares	Mar. 31, 2019shares	Oct. 25, 2019USD ($)a
Subsidiary, Sale of Stock [Line Items]
Number of shares redeemed (in shares) | shares	0	0
Percentage of weighted average number of shares of common stock outstanding authorized for repurchase	5.00%
Period of notice required for repurchase program termination	15 days
Distribution Reinvestment Plan
Subsidiary, Sale of Stock [Line Items]
Share price (in dollars per share) | $ / shares	$ 10
B Note
Subsidiary, Sale of Stock [Line Items]
Investment remaining amount	$ 6,518,000
2980 Huron | Corporate Joint Venture
Subsidiary, Sale of Stock [Line Items]
Number of acres | a			0.84
2980 Huron | Corporate Joint Venture | Preferred Equity Investment
Subsidiary, Sale of Stock [Line Items]
Amount of investment			$ 20,000,000
2980 Huron | Corporate Joint Venture | Common Equity Investment
Subsidiary, Sale of Stock [Line Items]
Real estate investments, equity			$ 17,500,000

Commitments and Contingencies_2

Commitments and Contingencies - Share Repurchase Program (Details)	Mar. 31, 2020$ / shares
Less than 1 year
Share Repurchase Program [Line Items]
Stock repurchase program, repurchase price per share (in dollars per share)	$ 8.80
1 year
Share Repurchase Program [Line Items]
Stock repurchase program, repurchase price per share (in dollars per share)	9
2 years
Share Repurchase Program [Line Items]
Stock repurchase program, repurchase price per share (in dollars per share)	9.20
3 years
Share Repurchase Program [Line Items]
Stock repurchase program, repurchase price per share (in dollars per share)	9.40
4 years
Share Repurchase Program [Line Items]
Stock repurchase program, repurchase price per share (in dollars per share)	9.60
5 years
Share Repurchase Program [Line Items]
Stock repurchase program, repurchase price per share (in dollars per share)	9.80
A stockholder’s death or complete disability, 2 years or more
Share Repurchase Program [Line Items]
Stock repurchase program, repurchase price per share (in dollars per share)	$ 10
Repurchase price as a percentage of estimated value	100.00%
1 year - 2 years
Share Repurchase Program [Line Items]
Repurchase price as a percentage of estimated value	85.00%
3 years - 4 years
Share Repurchase Program [Line Items]
Repurchase price as a percentage of estimated value	90.00%
5 years and thereafter
Share Repurchase Program [Line Items]
Repurchase price as a percentage of estimated value	95.00%
A stockholder’s death or complete disability, less than 2 years
Share Repurchase Program [Line Items]
Repurchase price as a percentage of estimated value	95.00%

Subsequent Events - Additional

Subsequent Events - Additional Information (Details) - USD ($)	May 12, 2020	May 11, 2020	May 14, 2020	Mar. 31, 2020
2019 Preferred Stock
Subsequent Event [Line Items]
Distributions				$ 61,000
Subsequent event
Subsequent Event [Line Items]
Gross offering proceeds		$ 104,547,764
Dividends on common stock, cash			$ 844,366
Common stock, annualized rate	5.00%
Distributions			$ 80,346
IPO | Subsequent event
Subsequent Event [Line Items]
Share price (in dollars per share)	$ 10
Distribution Reinvestment Plan
Subsequent Event [Line Items]
Share price (in dollars per share)				$ 10
Distribution Reinvestment Plan | Subsequent event
Subsequent Event [Line Items]
Number of shares sold (in shares)		81,907
Gross offering proceeds		$ 819,068
Share price (in dollars per share)	$ 10
Private Placement | Subsequent event
Subsequent Event [Line Items]
Gross offering proceeds		10,602,279
Payments of Stock Issuance Costs		701,359
Payments for Repurchase of Private Placement		$ 206,843
Share price (in dollars per share)			$ 10
Series 2019 Preferred Stock | Private Placement | Subsequent event | 2019 Preferred Stock
Subsequent Event [Line Items]
Number of shares sold (in shares)		1,063,994
Class A | Subsequent event
Subsequent Event [Line Items]
Number of shares sold (in shares)		10,491,466
Class T | Subsequent event
Subsequent Event [Line Items]
Number of shares sold (in shares)		17,503

Subsequent Events - Distributio

Subsequent Events - Distributions Declared and Paid (Details) - $ / shares	May 12, 2020	Mar. 16, 2020
Subsequent Event [Line Items]
Common stock, daily distribution rate (in dollars per share)		$ 0.00136612
Subsequent event
Subsequent Event [Line Items]
Preferred stock, annualized rate	5.50%
Preferred stock, daily distribution rate (in dollars per share)	$ 0.00150273
Common stock, annualized rate	5.00%
Common stock, daily distribution rate (in dollars per share)	$ 0.00136612