Cover Page
Cover Page - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 05, 2019 | |
Cover page. | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 30, 2019 | |
Document Transition Report | false | |
Entity File Number | 001-38199 | |
Entity Registrant Name | Tremont Mortgage Trust | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 82-1719041 | |
Entity Address, Address Line One | Two Newton Place | |
Entity Address, Address Line Two | 255 Washington Street | |
Entity Address, Address Line Three | Suite 300 | |
Entity Address, City or Town | Newton | |
Entity Address, State or Province | MA | |
Entity Address, Postal Zip Code | 02458-1634 | |
City Area Code | 617 | |
Local Phone Number | 796-8317 | |
Title of 12(b) Security | Common Shares of Beneficial Interest | |
Trading Symbol | TRMT | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Smaller Business Entity | true | |
Emerging Growth Company | true | |
Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 8,240,057 | |
Entity Central Index Key | 0001708405 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
ASSETS | ||
Cash and cash equivalents | $ 9,244 | $ 27,024 |
Restricted cash | 110 | 311 |
Loans held for investment, net | 207,464 | 135,844 |
Accrued interest receivable | 711 | 344 |
Prepaid expenses and other assets | 254 | 390 |
Total assets | 217,783 | 163,913 |
LIABILITIES AND SHAREHOLDERS' EQUITY | ||
Accounts payable, accrued liabilities and deposits | 759 | 935 |
Master repurchase facility, net | 130,312 | 71,691 |
Note payable, net | 0 | 31,485 |
Due to related persons | 33 | 134 |
Total liabilities | 131,104 | 104,245 |
Commitments and contingencies | ||
Shareholders' equity: | ||
Common shares of beneficial interest, $0.01 par value per share; 25,000,000 shares authorized; 8,240,057 and 3,178,817 shares issued and outstanding, respectively | 82 | 32 |
Additional paid in capital | 88,827 | 62,540 |
Cumulative net income (loss) | 624 | (2,904) |
Cumulative distributions | (2,854) | 0 |
Total shareholders’ equity | 86,679 | 59,668 |
Total liabilities and shareholders' equity | $ 217,783 | $ 163,913 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Statement of Financial Position [Abstract] | ||
Common shares of beneficial interest, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common shares of beneficial interest, shares authorized | 25,000,000 | 25,000,000 |
Common shares of beneficial interest, shares issued | 8,240,057 | 3,178,817 |
Common shares of beneficial interest, shares outstanding | 8,240,057 | 3,178,817 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
INCOME FROM INVESTMENTS: | ||||
Interest income from investments | $ 4,959 | $ 1,385 | $ 11,872 | $ 2,113 |
Less: interest and related expenses | (1,992) | (563) | (5,572) | (666) |
Income from investments, net | 2,967 | 822 | 6,300 | 1,447 |
OTHER EXPENSES: | ||||
Management fees | 0 | 0 | 0 | 447 |
General and administrative expenses | 541 | 510 | 1,662 | 1,668 |
Reimbursement of shared services expenses | 370 | 375 | 1,110 | 1,125 |
Total expenses | 911 | 885 | 2,772 | 3,240 |
Net income (loss) | $ 2,056 | $ (63) | $ 3,528 | $ (1,793) |
Weighted average common shares outstanding - basic and diluted (in shares) | 8,156 | 3,129 | 5,583 | 3,121 |
Net income (loss) per common share - basic and diluted (in dollars per share) | $ 0.25 | $ (0.02) | $ 0.63 | $ (0.57) |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income (loss) | $ 3,528 | $ (1,793) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Share based compensation | 300 | 349 |
Amortization of deferred financing costs | 502 | 184 |
Amortization of loan origination and exit fees | (1,333) | (145) |
Changes in operating assets and liabilities: | ||
Accrued interest receivable | (367) | (293) |
Prepaid expenses and other assets | 136 | 5 |
Accounts payable, accrued liabilities and deposits | (176) | 275 |
Due to related persons | (101) | (731) |
Net cash provided by (used in) operating activities | 2,489 | (2,149) |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Origination of loans held for investment | (119,062) | (81,519) |
Additional funding of loans held for investment | (4,835) | 0 |
Repayment of loans held for investment | 53,610 | 0 |
Net cash used in investing activities | (70,287) | (81,519) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from master repurchase facility | 92,983 | 21,583 |
Repayment of master repurchase facility | (34,312) | 0 |
Proceeds from RMR credit agreement | 14,220 | 0 |
Repayment of RMR credit agreement | (14,220) | 0 |
Proceeds from note payable | 0 | 31,690 |
Repayment of note payable | (31,690) | 0 |
Payments of deferred financing costs | (347) | (1,045) |
Proceeds from issuance of common shares, net | 26,074 | 0 |
Repurchase of common shares | (37) | (25) |
Distributions | (2,854) | 0 |
Net cash provided by financing activities | 49,817 | 52,203 |
Decrease in cash, cash equivalents and restricted cash | (17,981) | (31,465) |
Cash, cash equivalents and restricted cash at beginning of period | 27,335 | 61,666 |
Cash, cash equivalents and restricted cash at end of period | 9,354 | 30,201 |
SUPPLEMENTAL DISCLOSURES: | ||
Interest paid | 4,974 | 382 |
Total cash, cash equivalents and restricted cash shown in the condensed consolidated statements of cash flows | $ 27,335 | $ 61,666 |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY - USD ($) $ in Thousands | Total | Common Shares | Additional Paid In Capital | Cumulative Net Loss | Cumulative Distributions |
Beginning balance (in shares) at Dec. 31, 2017 | 3,126,000 | ||||
Beginning balance at Dec. 31, 2017 | $ 60,870 | $ 31 | $ 62,135 | $ (1,296) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share grants (in shares) | 2,000 | ||||
Share grants | 20 | 20 | |||
Net income (loss) | (949) | (949) | |||
Ending balance (in shares) at Mar. 31, 2018 | 3,128,000 | ||||
Ending balance at Mar. 31, 2018 | 59,941 | $ 31 | 62,155 | (2,245) | $ 0 |
Beginning balance (in shares) at Dec. 31, 2017 | 3,126,000 | ||||
Beginning balance at Dec. 31, 2017 | 60,870 | $ 31 | 62,135 | (1,296) | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income (loss) | (1,793) | ||||
Ending balance (in shares) at Sep. 30, 2018 | 3,179,000 | ||||
Ending balance at Sep. 30, 2018 | 59,386 | $ 32 | 62,443 | (3,089) | 0 |
Beginning balance (in shares) at Mar. 31, 2018 | 3,128,000 | ||||
Beginning balance at Mar. 31, 2018 | 59,941 | $ 31 | 62,155 | (2,245) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share grants (in shares) | 15,000 | ||||
Share grants | 189 | 189 | |||
Net income (loss) | (781) | (781) | |||
Ending balance (in shares) at Jun. 30, 2018 | 3,143,000 | ||||
Ending balance at Jun. 30, 2018 | 59,349 | $ 31 | 62,344 | (3,026) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share grants (in shares) | 46,000 | ||||
Share grants | 110 | $ 1 | 109 | ||
Net income (loss) | (63) | (63) | |||
Share repurchases (in shares) | (2,000) | ||||
Share repurchases | (25) | (25) | |||
Share grant forfeitures (in shares) | (8,000) | ||||
Share grant forfeitures | 15 | 15 | |||
Ending balance (in shares) at Sep. 30, 2018 | 3,179,000 | ||||
Ending balance at Sep. 30, 2018 | $ 59,386 | $ 32 | 62,443 | (3,089) | 0 |
Beginning balance (in shares) at Dec. 31, 2018 | 3,178,817 | 3,179,000 | |||
Beginning balance at Dec. 31, 2018 | $ 59,668 | $ 32 | 62,540 | (2,904) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share grants | 35 | 35 | |||
Net income (loss) | 578 | 578 | |||
Distributions | (350) | (350) | |||
Ending balance (in shares) at Mar. 31, 2019 | 3,179,000 | ||||
Ending balance at Mar. 31, 2019 | $ 59,931 | $ 32 | 62,575 | (2,326) | (350) |
Beginning balance (in shares) at Dec. 31, 2018 | 3,178,817 | 3,179,000 | |||
Beginning balance at Dec. 31, 2018 | $ 59,668 | $ 32 | 62,540 | (2,904) | 0 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income (loss) | $ 3,528 | ||||
Ending balance (in shares) at Sep. 30, 2019 | 8,240,057 | 8,240,000 | |||
Ending balance at Sep. 30, 2019 | $ 86,679 | $ 82 | 88,827 | 624 | (2,854) |
Beginning balance (in shares) at Mar. 31, 2019 | 3,179,000 | ||||
Beginning balance at Mar. 31, 2019 | 59,931 | $ 32 | 62,575 | (2,326) | (350) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share grants (in shares) | 15,000 | ||||
Share grants | 185 | 185 | |||
Net income (loss) | 894 | 894 | |||
Distributions | (702) | (702) | |||
Share repurchases (in shares) | (1,000) | ||||
Share repurchases | (6) | (6) | |||
Public offering (in shares) | 5,000,000 | ||||
Public offering | 26,074 | $ 50 | 26,024 | ||
Ending balance (in shares) at Jun. 30, 2019 | 8,193,000 | ||||
Ending balance at Jun. 30, 2019 | 86,376 | $ 82 | 88,778 | (1,432) | (1,052) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Share grants (in shares) | 53,000 | ||||
Share grants | 80 | 80 | |||
Net income (loss) | 2,056 | 2,056 | |||
Distributions | (1,802) | (1,802) | |||
Share repurchases (in shares) | (6,000) | ||||
Share repurchases | $ (31) | (31) | |||
Ending balance (in shares) at Sep. 30, 2019 | 8,240,057 | 8,240,000 | |||
Ending balance at Sep. 30, 2019 | $ 86,679 | $ 82 | $ 88,827 | $ 624 | $ (2,854) |
Organization
Organization | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Organization Tremont Mortgage Trust, or, collectively with its consolidated subsidiaries, we, us or our, was organized as a real estate investment trust, or REIT, under Maryland law on June 1, 2017. On September 18, 2017 , we issued and sold 2,500,000 of our common shares of beneficial interest, par value $0.01 per share, or our common shares, at a price of $20.00 per share in our initial public offering, or our IPO. Concurrently with our IPO, we issued and sold an additional 600,000 of our common shares to Tremont Realty Advisors LLC, or our Manager, at the public offering price in a private placement. The aggregate proceeds from these sales were $62,000 . |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Presentation The accompanying condensed consolidated financial statements of Tremont Mortgage Trust and its consolidated subsidiaries are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2018 , or our 2018 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the accompanying condensed consolidated financial statements include the fair value of financial instruments. Cash, Cash Equivalents and Restricted Cash We consider highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. Restricted cash primarily consists of deposit proceeds from potential borrowers when originating loans, which may be returned to the applicable borrower upon the closing of the loan, after deducting any transaction costs paid by us for the benefit of such borrower. Loans Held for Investment Generally, our loans are classified as held for investment based upon our intent and ability to hold them until maturity. Loans that are held for investment are carried at cost, net of unamortized loan origination and accreted exit fees that are required to be recognized in the carrying value of the loans in accordance with GAAP, unless the loans are deemed to be impaired. Loans that we have a plan to sell or liquidate will be held at the lower of cost or fair value less cost to sell. We evaluate each of our loans for impairment at least quarterly by assessing a variety of risk factors in relation to each loan and assigning a risk rating to each loan based on those factors. Factors considered in these evaluations include, but are not limited to, property type, geographic and local market dynamics, physical condition, leasing and tenant profile, projected cash flow, risk of loss, current loan to value ratio, or LTV, debt yield, collateral performance, structure, exit plan and sponsorship. Loans are rated “1” (less risk) through “5” (greater risk) as defined below: "1" lower risk—Criteria reflects a sponsor having a strong financial condition and low credit risk and our evaluation of management's experience; collateral performance exceeding performance metrics included in the business plan or credit underwriting; and the property demonstrating stabilized occupancy and/or market rates, resulting in strong current cash flow and net operating income and/or having a very low LTV. "2" average risk—Criteria reflects a sponsor having a stable financial condition and our evaluation of management's experience; collateral performance meeting or exceeding substantially all performance metrics included in the business plan or credit underwriting; and the property demonstrating improved occupancy at market rents, resulting in sufficient current cash flow and/or having a low LTV. "3" acceptable risk—Criteria reflects a sponsor having a history of repaying loans at maturity and meeting its credit obligations and our evaluation of management's experience; collateral performance expected to meet performance metrics included in the business plan or credit underwriting; and the property having a moderate LTV. New loans and loans with a limited history will typically be assigned this rating and will be adjusted to other levels from time to time as appropriate. "4" higher risk—Criteria reflects a sponsor having a history of unresolved missed or late payments, maturity extensions and difficulty timely fulfilling its credit obligations and our evaluation of management's experience; collateral performance failing to meet the business plan or credit underwriting; the existence of a risk of default possibly leading to a loss and/or potential weaknesses that deserve management’s attention; and the property having a high LTV. "5" impaired/loss likely—Criteria reflects a very high risk of realizing a principal loss or having incurred a principal loss; a sponsor having a history of default payments, trouble fulfilling its credit obligations, deeds in lieu of foreclosures, and/or bankruptcies; collateral performance is significantly worse than performance metrics included in the business plan; loan covenants or performance milestones having been breached or not attained; timely exit via sale or refinancing being uncertain; and the property having a very high LTV. See Note 4 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—Our Portfolio” included in Part I, Item 2 of this Quarterly Report on Form 10-Q for a discussion regarding our current loan portfolio’s assessment under our internal risk rating policy. Impairment occurs when it is deemed probable that we will not be able to collect all amounts due under a loan according to its contractual terms. Impairment will then be measured based on the present value of expected future cash flows discounted at the loan’s contractual effective rate and the fair value of any available collateral, net of any costs we expect to incur to realize that value. The determination of whether loans are impaired involves judgments and assumptions based on objective and subjective factors. Consideration will be given to various factors, such as business plans, property occupancies, tenant profiles, rental rates, operating expenses and borrowers’ repayment plans, among others, and will require significant judgments, including assumptions regarding the values of loans, the values of underlying collateral and other circumstances, such as guarantees, if any. Upon measurement of an impairment, we will record an allowance to reduce the carrying value of the loan accordingly, and record a corresponding charge to net income in our condensed consolidated statements of operations. As of September 30, 2019 , we have not recorded any allowance for losses as we believe it is probable that we will collect all amounts due pursuant to the contractual terms of our loans. Repurchase Agreements Loans financed through repurchase agreements are treated as collateralized financing transactions, unless they meet sales treatment under GAAP. Pursuant to GAAP treatment of collateralized financing transactions, loans financed through repurchase agreements remain on our condensed consolidated balance sheet as assets, and cash received from the purchasers is recorded on our condensed consolidated balance sheet as liabilities. Interest paid in accordance with repurchase agreements is recorded as interest expense. Revenue Recognition Interest income related to our first mortgage whole loans secured by commercial real estate, or CRE, will generally be accrued based on the coupon rates applied to the outstanding principal balance of such loans. Fees, premiums and discounts, if any, will be amortized or accreted into interest income over the remaining lives of the loans using the effective interest method, as adjusted for any prepayments. If a loan's interest or principal payments are not paid when due and there is uncertainty that such payments will be collected, the loan may be categorized as non-accrual and no interest will be recorded unless it is collected. When all overdue payments are collected and, in our judgment, a loan is likely to remain current, it may be re-categorized as accrual. |
Loans Held for Investment
Loans Held for Investment | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Loans Held for Investment | Loans Held for Investment We originate first mortgage whole loans secured by middle market and transitional CRE and related instruments which are generally to be held as long term investments. To fund our loan originations to date, we used cash on hand, advancements under our master repurchase facility with Citibank, N.A., or Citibank, or our Master Repurchase Facility, and borrowings under our former term loan facility, in the form of a note payable, with Texas Capital Bank, National Association, or Texas Capital Bank, or the TCB note payable. See Note 5 for further information regarding our debt agreements. The table below details overall statistics for our loan portfolio: Balance at September 30, 2019 Balance at December 31, 2018 Number of loans 10 7 Total loan commitments $ 227,157 $ 154,802 Unfunded loan commitments (1) $ 18,813 $ 17,673 Principal balance $ 208,344 $ 137,129 Unamortized net deferred origination fees $ (880 ) $ (1,285 ) Carrying value $ 207,464 $ 135,844 Weighted average coupon rate 5.85 % 6.14 % Weighted average all in yield (2) 6.51 % 6.82 % Weighted average maximum maturity (years) (3) 3.6 4.7 Weighted average LTV 70 % 70 % (1) Unfunded commitments will primarily be funded to finance property and building improvements and leasing capital. These commitments will generally be funded over the term of each loan. (2) All in yield includes the amortization of deferred fees over the initial term of the loan. (3) Maximum maturity assumes all extension options are exercised, which options are subject to the borrower meeting certain conditions. The table below details our loan activities for the three months ended September 30, 2019 : Principal Balance Deferred Fees Carrying Value Balance at beginning of period $ 260,488 $ (1,531 ) $ 258,957 Additional funding 1,466 — 1,466 Repayments (53,610 ) 449 (53,161 ) Net amortization of deferred fees — 202 202 Balance at end of period $ 208,344 $ (880 ) $ 207,464 The table below details our loan activities for the nine months ended September 30, 2019 : Principal Balance Deferred Fees Carrying Value Balance at beginning of period $ 137,129 $ (1,285 ) $ 135,844 Additional funding 4,835 — 4,835 Originations 119,990 (928 ) 119,062 Repayments (53,610 ) 449 (53,161 ) Net amortization of deferred fees — 884 884 Balance at end of period $ 208,344 $ (880 ) $ 207,464 The tables below detail the property type and geographic distribution of the properties securing the loans included in our portfolio at September 30, 2019 : Property Type Number of Loans Carrying Value Percentage of Value Office 3 $ 56,816 27 % Hotel 1 23,068 11 % Retail 3 40,882 20 % Multifamily 2 51,911 25 % Industrial 1 34,787 17 % 10 $ 207,464 100 % Geographic Location Number of Loans Carrying Value Percentage of Value East 2 $ 59,205 29 % South 5 102,548 49 % West 1 6,376 3 % Midwest 2 39,335 19 % 10 $ 207,464 100 % Loan Risk Ratings We evaluate each of our loans for impairment at least quarterly by assessing a variety of risk factors in relation to each loan and assigning a risk rating to each loan based on those factors. Factors considered in these evaluations include, but are not limited to, property type, geographic and local market dynamics, physical condition, leasing and tenant profile, projected cash flow, risk of loss, current LTV, debt yield, collateral performance, structure, exit plan and sponsorship. At September 30, 2019 , we had 10 first mortgage whole loans with an aggregate carrying value of $ 207,464 . Based on our internal risk rating policy, each of these loans was assigned a "3" acceptable risk rating at September 30, 2019 . We did not have any impaired loans, non-accrual loans or loans in maturity default as of September 30, 2019 ; thus, we did not record a reserve for loan loss. See Note 2 for a discussion regarding the risk rating system that we use in evaluating our portfolio. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update, or ASU, No. 2016-13, Financial Instruments - Credit Losses (Topic 326) : Measurement of Credit Losses on Financial Instruments , which requires that entities use a new forward looking “expected loss” model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU No. 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. As an emerging growth company that has opted to take advantage of the extended transition period, we expect to adopt ASU No. 2016-13 on January 1, 2022. We are currently assessing the potential impact the adoption of ASU No. 2016-13 will have in our condensed consolidated financial statements. |
Debt Agreements
Debt Agreements | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Debt Agreements | Debt Agreements At September 30, 2019 , our debt agreements included our Master Repurchase Facility. Debt Obligation Weighted Average Collateral Maximum Facility Size Principal Balance Carrying Value Coupon Rate Remaining Maturity (1) (years) Principal Balance Fair Value (2) September 30, 2019: Master repurchase facility $ 213,482 $ 131,253 $ 130,312 L + 2.00% 1.8 $ 208,344 $ 208,647 December 31, 2018: Master repurchase facility $ 135,000 $ 72,582 $ 71,691 L + 2.08% 2.6 $ 97,516 $ 98,232 Note payable 32,290 31,690 31,485 L + 2.15% 2.6 39,613 39,640 (1) The weighted average remaining maturity is determined using the current maturity date of the corresponding loans, excluding extension options. (2) See Note 6 for further discussion of our financial assets and liabilities not carried at fair value. Until May 23, 2019 , we were a party to a credit agreement with our Manager as lender, or the RMR Credit Agreement. Following our repayment of the approximate $14,220 balance then outstanding under the RMR Credit Agreement, the RMR Credit Agreement was terminated. See below in this Note 5 for information regarding the RMR Credit Agreement. Until August 9, 2019, we were a party to the TCB note payable. Following our repayment of the $31,790 outstanding principal and accrued interest under the TCB note payable, the TCB note payable terminated in accordance with its terms. See below in this Note 5 for information regarding the TCB Note Payable. For the three months ended September 30, 2019 , we recorded interest expense of $1,563 and $155 in connection with our Master Repurchase Facility and the TCB note payable, respectively. For the nine months ended September 30, 2019 , we recorded interest expense of $4,126 , $891 and $39 in connection with our Master Repurchase Facility, the TCB note payable and the RMR Credit Agreement, respectively. At September 30, 2019 , our outstanding borrowings had the following remaining maturities: Year Principal payments on Master Repurchase Facility (1) 2019 $ — 2020 26,395 2021 104,858 2022 — 2023 — $ 131,253 (1) The allocation of our outstanding borrowings under our Master Repurchase Facility is based on the current maturity date of each loan investment with respect to which the individual borrowing relates. Master Repurchase Facility On February 9, 2018, one of our wholly owned subsidiaries entered into agreements to govern our Master Repurchase Facility, or collectively, as amended, our Master Repurchase Agreement, pursuant to which we may sell to, and later repurchase from, Citibank, floating rate mortgage loans and other related assets, or purchased assets. At that time, our Master Repurchase Facility provided up to $100,000 for advancements. On November 6, 2018, we amended our Master Repurchase Agreement to increase the maximum amount available for advancement under the facility from $100,000 to $135,000 and to change its stated expiration date from February 9, 2021 to November 6, 2021, subject to earlier termination as provided for in our Master Repurchase Agreement. On February 4, 2019, we increased the maximum amount available for advancement under our Master Repurchase Facility from $135,000 to $210,000 and on May 1, 2019, in connection with an increase in commitment under the RMR Credit Agreement, we further increased the maximum amount available for advancement under our Master Repurchase Facility from $210,000 to $250,000 , in each case with the additional advancements being available for borrowing under our Master Repurchase Facility if and as we borrowed under the RMR Credit Agreement or if and as we received proceeds from any public offering of our common shares or preferred equity, as further provided in our Master Repurchase Agreement. In connection with the February 2019 increase, certain other provisions of our Master Repurchase Agreement were amended to accommodate the RMR Credit Agreement. In May 2019, we completed an underwritten public offering, or the Offering, as further described in Note 7, we repaid the outstanding borrowings under the RMR Credit Agreement and the RMR Credit Agreement was terminated and the maximum amount available for advancement under our Master Repurchase Facility was reduced to $213,482 . Under our Master Repurchase Agreement, the initial purchase price paid by Citibank for each purchased asset is up to 75% of the lesser of the market value of the purchased asset or the unpaid principal balance of such purchased asset, subject to Citibank’s approval. Upon the repurchase of a purchased asset, we are required to pay Citibank the outstanding purchase price of the purchased asset, accrued interest and all accrued and unpaid expenses of Citibank relating to such purchased asset. The price differential (or interest rate) relating to a purchased asset is equal to LIBOR plus a premium of 200 to 250 basis points, determined by the yield of the purchased asset and the property type of the purchased asset’s real estate collateral. Citibank has the discretion under our Master Repurchase Agreement to advance at higher margins than 75% and at premiums of less than 200 basis points. The weighted average interest rate for borrowings under our Master Purchase Facility was 4.27% and 4.35% for the three months ended September 30, 2019 and 2018, respectively, and 4.42% and 4.34% for the nine months ended September 30, 2019 and 2018, respectively. In connection with our Master Repurchase Agreement, we entered into a guaranty which requires us to pay the purchase price, purchase price differential and any costs and expenses of Citibank related to our Master Repurchase Agreement. This guaranty also requires us to comply with customary financial covenants, which include the maintenance of a minimum tangible net worth, minimum cash liquidity, a total indebtedness to tangible net worth ratio and a minimum interest coverage ratio. These maintenance provisions provide Citibank with the right, in certain circumstances related to a credit event, as defined in our Master Repurchase Agreement, to re-determine the value of purchased assets. Where a decline in the value of purchased assets has resulted in a margin deficit, Citibank may require us to eliminate such margin deficit through a combination of purchased asset repurchases and cash transfers to Citibank, subject to Citibank's approval. Our Master Repurchase Agreement also provides for acceleration of the date of repurchase of the purchased assets and Citibank’s liquidation of the purchased assets upon the occurrence and continuation of certain events of default, including a change of control of us, which includes our Manager ceasing to act as our sole manager or to be a wholly owned subsidiary of The RMR Group LLC, or RMR LLC. As of September 30, 2019 , we believe we were in compliance with the terms and conditions of the covenants of our Master Repurchase Agreement and the related guaranty. On August 23, 2019, we received $14,635 of repayment proceeds from the borrower on its loan held for investment that was used to refinance an office building located in Scarsdale, NY, which included the $13,997 of principal outstanding under the loan, as well as the accrued interest, an exit fee, prepayment premium and our associated legal expenses. We were required to use $10,422 of these repayment proceeds to repay the outstanding balance and accrued interest under our Master Repurchase Facility associated with this loan, and we used the remaining proceeds to pay down additional outstanding balances under our Master Repurchase Facility. Further, on August 13, 2019, we used $8,000 of proceeds from the repayment of the JFK loan by the borrower, as described below, to pay down additional outstanding balances under our Master Repurchase Facility. As of September 30, 2019 , we had $24,203 available for immediate advancement under our Master Repurchase Facility from loans currently pledged under our Master Repurchase Facility, and $58,026 of unused capacity under our Master Repurchase Facility subject to our identifying suitable first mortgage whole loans for investment. Note Payable In July 2018, we closed a $40,363 loan, of which $39,613 was funded by us at closing to finance the acquisition of the Hampton Inn JFK, a 216 key, 13 story hotel located adjacent to the John F. Kennedy International Airport in Queens, NY, or the JFK loan. On August 9, 2019, the borrower repaid the $39,613 principal amount outstanding under the JFK loan, together with accrued interest, an exit fee and our associated legal expenses, for a total payoff amount of $39,922 . In connection with the JFK loan, one of our wholly owned subsidiaries entered into the TCB note payable, which advanced up to 80% of the JFK loan amount from time to time and was scheduled to mature in July 2021. Upon repayment of the JFK loan by the borrower in August 2019, we were required to repay the $31,690 principal amount outstanding under the TCB note payable, together with accrued interest, for a total payoff amount of $31,790 . Following such repayment, the TCB note payable terminated in accordance with its terms. Interest payable on amounts advanced under the TCB note payable was calculated at a floating rate based on LIBOR plus a premium of 215 basis points. In connection with the TCB note payable, we entered into a guaranty with Texas Capital Bank pursuant to which we guaranteed 25% of the TCB note payable amount plus all related interest and costs, which guaranty was released upon repayment of the TCB note payable. The remaining proceeds from the repayment of the JFK loan by the borrower, after our repayment of the TCB note payable, were used to pay down outstanding balances under our Master Repurchase Facility. RMR Credit Agreement On February 4, 2019, we entered into the RMR Credit Agreement, pursuant to which, from time to time until August 4, 2019, the scheduled expiration date of the RMR Credit Agreement, we were able to borrow up to $25,000 and, beginning May 3, 2019, $50,000 in subordinated unsecured loans at a rate of 6.50% per annum. In May 2019, we borrowed $14,220 under the RMR Credit Agreement to fund additional investments in first mortgage whole loans. Also in May 2019, we completed the Offering. Subsequently, in May 2019, we repaid the approximate $14,220 balance then outstanding under the RMR Credit Agreement with a portion of the Offering proceeds and the RMR Credit Agreement was terminated. In connection with this repayment and termination, we paid our Manager approximately $39 of interest and $7 of fees. See Note 7 for further information regarding the Offering. We have historical and continuing relationships with our Manager. See Notes 8 and 9 for further information regarding these relationships and related party transactions. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | Fair Value of Financial Instruments ASC 820, Fair Value Measurements , establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets and liabilities (Level I), and the lowest priority to unobservable inputs (Level III). A financial asset’s or financial liability’s fair value measurement level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement. Valuation techniques used need to maximize the use of observable inputs and minimize the use of unobservable inputs. As of September 30, 2019 and December 31, 2018 , the carrying values of cash and cash equivalents, restricted cash and accounts payable approximated their fair values due to the short term nature of these financial instruments. At September 30, 2019 and December 31, 2018 , the outstanding principal balances under our Master Repurchase Facility, and at December 31, 2018 , the outstanding principal balance under the TCB note payable approximated their fair values, as interest was based on floating rates based on LIBOR plus a spread, and the spread was consistent with those demanded by the market. We estimate the fair values of our loans held for investment by using Level III inputs, including discounted cash flow analyses and currently prevailing market terms as of the measurement date, determined by significant unobservable market inputs, which include holding periods, discount rates based on LTV, property types and loan pricing expectations which are corroborated by a comparison with other market participants to determine the appropriate market spread to add to the one month LIBOR (Level III inputs as defined in the fair value hierarchy under GAAP). The table below provides information regarding financial assets and liabilities not carried at fair value on a recurring basis in our condensed consolidated balance sheets: September 30, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value Financial assets Loans held for investment $ 207,464 $ 208,647 $ 135,844 $ 137,872 Financial liabilities Master Repurchase Facility 130,312 131,253 71,691 72,582 Note payable — — 31,485 31,690 There were no transfers of financial assets or liabilities within the fair value hierarchy during the three or nine months ended September 30, 2019 |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Shareholders' Equity | Shareholders' Equity May 2019 Offering On May 21, 2019 , we completed the Offering. In the Offering, we issued and sold 5,000,000 of our common shares at a price of $5.65 per share for total net proceeds of $26,074 , after deducting the underwriting discounts and commissions and other expenses. Our Manager purchased 1,000,000 of our common shares in the Offering at the public offering price, without the payment of any underwriting discounts. We used the net proceeds of the Offering to repay the approximate $14,220 balance then outstanding under the RMR Credit Agreement and to reduce borrowings under our Master Repurchase Facility by approximately $11,900 . After repayment of the outstanding balance under the RMR Credit Agreement, the RMR Credit Agreement was terminated. See Note 5 for further information regarding the RMR Credit Agreement. Common Share Issuances and Repurchases On April 5, 2019, we purchased an aggregate of 644 of our common shares, valued at $9.39 per common share, the closing price of our common shares on The Nasdaq Stock Market LLC, or Nasdaq, on that day, from a former officer of RMR LLC in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. On April 24, 2019, we granted 3,000 of our common shares, valued at $10.36 per share, the closing price of our common shares on Nasdaq on that day, to each of our five Trustees as part of their annual compensation. On July 3, 2019, we purchased an aggregate of 704 of our common shares, valued at $4.03 per common share, the closing price of our common shares on Nasdaq on that day, from a former officer of RMR LLC in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. On September 18, 2019, we granted an aggregate of 53,300 shares, valued at $4.55 per share, the closing price of our common shares on Nasdaq on that day to our officers and certain other employees of our Manager and of RMR LLC under our equity compensation plan. On September 25, 2019, we purchased an aggregate of 5,712 of our common shares valued at $4.82 per common share, the closing price of our common shares on Nasdaq on that day from our officers and certain other employees of our Manager and of RMR LLC in satisfaction of tax withholding and payment obligations in connection with the vesting of awards of our common shares. Distributions During the nine months ended September 30, 2019 , we declared and paid regular quarterly distributions to common shareholders as follows: Record Date Payment Date Distribution Per Share Total Distribution January 28, 2019 February 21, 2019 $0.11 $350 April 29, 2019 May 16, 2019 $0.22 $702 July 29, 2019 August 15, 2019 $0.22 $1,802 On October 17, 2019 , we declared a regular quarterly distribution to common shareholders of record on October 28, 2019 of $0.22 per common share, or approximately $1,813 . We expect to pay this distribution on or about November 14, 2019 . |
Management Agreement with our M
Management Agreement with our Manager | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Management Agreement with our Manager | Management Agreement with our Manager We have no employees. The personnel and various services we require to operate our business are provided to us by our Manager pursuant to a management agreement, which provides for the day to day management of our operations by our Manager, subject to the oversight and direction of our Board of Trustees. In June 2018, our Manager agreed to waive any base management fees otherwise due and payable pursuant to our management agreement for the period beginning July 1, 2018 until June 30, 2020. In addition, our Manager also agreed that no incentive fee will be paid or payable by us for the 2018 or 2019 calendar years. As a result, we did not recognize any base management fees or incentive fees for the three or nine months ended September 30, 2019 and the three months ended September 30, 2018 . If our Manager had not agreed to waive these fees, we would have recognized $322 and $812 of base management fees for the three and nine months ended September 30, 2019 , respectively, and no incentive fees for the three and nine months ended September 30, 2019 . Pursuant to our management agreement, we recognized $0 and $447 of base management fees for the three and nine months ended September 30, 2018 , respectively, and no incentive fees for the three or nine months ended September 30, 2018 . If our Manager had not agreed to waive these fees, we would have recognized $222 of base management fees for the three months ended September 30, 2018, which would have resulted in us recognizing $669 of total base management fees for the nine months ended September 30, 2018 (including the $447 of business management fees actually recognized) and no incentive fees for the three and nine months ended September 30, 2018. Our Manager, and not us, is responsible for the costs of its employees who provide services to us, including the cost of our Manager’s personnel who originate our loans, unless any such payment or reimbursement is specifically approved by a majority of our Independent Trustees, is a shared services cost or relates to awards made under any equity compensation plan adopted by us. We are generally required to pay or to reimburse our Manager and its affiliates for all other costs and expenses of our operations. Some of these overhead, professional and other services are provided by RMR LLC pursuant to a shared services agreement between our Manager and RMR LLC. We reimburse our Manager for shared services costs our Manager pays to RMR LLC and its affiliates, and these reimbursements may include an allocation of the cost of personnel employed by RMR LLC and our share of RMR LLC’s costs for providing our internal audit function, with such shared services costs subject to approval by a majority of our Independent Trustees at least annually. We incurred shared services costs of $370 and $375 payable to our Manager as reimbursement for shared services costs it paid to RMR LLC for the three months ended September 30, 2019 and 2018 , respectively, and $1,110 and $1,125 for the nine months ended September 30, 2019 and 2018 , respectively. We include these amounts in reimbursement of shared services expenses or general and administrative expenses, as applicable, in our condensed consolidated statements of operations. |
Related Person Transactions
Related Person Transactions | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Person Transactions | Related Person Transactions We have relationships and historical and continuing transactions with our Manager, RMR LLC, The RMR Group Inc., or RMR Inc., and others related to them, including other companies to which RMR LLC or its subsidiaries provide management services and which have trustees, directors and officers who are also our Trustees or officers. Our Manager, Tremont Realty Advisors LLC. We have a management agreement with our Manager to provide management services to us. See Note 8 for further information regarding our management agreement with our Manager. We were formerly a 100% owned subsidiary of our Manager. Our Manager is our largest shareholder and, as of September 30, 2019 , owned 1,600,100 of our common shares, or approximately 19.4% of our outstanding common shares. Included in those shares are the 1,000,000 of our common shares that our Manager purchased in the Offering. See Note 7 for further information regarding the Offering. Each of our Managing Trustees and officers is also a director or officer of our Manager and of RMR LLC. Until May 23, 2019, we were a party to the RMR Credit Agreement with our Manager. See Note 5 for information regarding the RMR Credit Agreement. RMR Inc. and RMR LLC. Our Manager is a subsidiary of RMR LLC, which is a majority owned subsidiary of RMR Inc., and RMR Inc. is the managing member of RMR LLC. The controlling shareholder of RMR Inc. is ABP Trust. Adam D. Portnoy, one of our Managing Trustees, is the sole trustee, an officer and the controlling shareholder of ABP Trust, a managing director, president and chief executive officer of RMR Inc., a director of our Manager and an officer and employee of RMR LLC. David M. Blackman, our other Managing Trustee and our President and Chief Executive Officer, also serves as the president, chief executive officer and a director of our Manager and is an officer and employee of RMR LLC. RMR LLC provides certain shared services to our Manager that are applicable to us, and we reimburse our Manager for the amount it pays for those services. See Note 8 for further information regarding this shared services arrangement. For further information about these and other such relationships and certain other related person transactions, refer to our 2018 Annual Report. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesWe have elected to be taxed as a REIT under the Internal Revenue Code of 1986, as amended, or the IRC. Accordingly, we generally are not, and will not be, subject to U.S. federal income tax, provided that we meet certain distribution and other requirements. We are subject to certain state and local taxes, certain of which amounts are or will be reported as income taxes in our condensed consolidated statements of operations |
Weighted Average Common Shares
Weighted Average Common Shares | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Weighted Average Common Shares | Weighted Average Common Shares We calculate basic earnings per share, or EPS, by dividing net income (loss) by the weighted average number of common shares outstanding during the relevant period. We calculate diluted EPS using the more dilutive of the two class method or the treasury stock method. Unvested share awards and other potentially dilutive common share issuances and the related impact on earnings (loss), are considered when calculating diluted earnings (loss) per share. For the three and nine months ended September 30, 2019 , 39,024 and 15,037 unvested common shares, respectively, were excluded from the calculation of diluted earnings (loss) per share because to do so would have been antidilutive. Due to net losses incurred during the three and nine months ended September 30, 2018 , basic weighted average shares is equal to diluted weighted average shares for such periods. As a result, 2,204 and 1,071 restricted unvested common shares were excluded from the computation of diluted EPS for the three and nine months ended September 30, 2018 , respectively. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Unfunded Commitments As of September 30, 2019 , we had unfunded commitments of $18,813 related to our loans held for investment. Unfunded commitments will generally be funded to finance property and building improvements and leasing capital over the term of the applicable loan. Unfunded commitments are not reflected in our condensed consolidated balance sheets. Loans held for investment related to our unfunded commitments had a weighted average initial maturity of 2 years . See Note 4 for further information regarding loans held for investment. Borrowings As of September 30, 2019 , we had an aggregate of $ 131,253 in principal amount outstanding under our Master Repurchase Facility with a weighted average life to maturity of 1.8 years . See Note 5 for further information regarding our secured debt agreements. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Sep. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | <div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-bottom:13px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;">Subsequent Events</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In July 2019, we received a repayment notice with respect to the JFK loan.&#160;Pursuant to the notice, the borrower stated that it will repay the loan in August 2019. At the time of notice, there was approximately </font><font style="font-family:inherit;font-size:10pt;">$39,613</font><font style="font-family:inherit;font-size:10pt;"> of principal amount outstanding under the JFK loan, which the borrower is required to pay, together with accrued interest, an exit fee and any expenses incurred by us with respect to this loan. When the JFK loan is repaid, we will be required to repay the outstanding balance under the TCB note payable.</font></div><div style="line-height:120%;padding-bottom:13px;text-align:left;text-indent:48px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In July 2019, we received a repayment notice with respect to our loan held for investment associated with an office building located in Scarsdale, NY. Pursuant to the notice, the borrower stated that it will repay the loan in August 2019. At the time of notice, there was approximately </font><font style="font-family:inherit;font-size:10pt;">$13,997</font><font style="font-family:inherit;font-size:10pt;"> of principal amount outstanding under this loan, which the borrower is required to pay, together with accrued interest, an exit fee and any expenses incurred by us with respect to this loan. When this loan is repaid, we will be required to repay the associated outstanding balance under our Master Repurchase Facility.</font></div></div> |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying condensed consolidated financial statements of Tremont Mortgage Trust and its consolidated subsidiaries are unaudited. Certain information and disclosures required by U.S. generally accepted accounting principles, or GAAP, for complete financial statements have been condensed or omitted. We believe the disclosures made are adequate to make the information presented not misleading. However, the accompanying condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes contained in our Annual Report on Form 10-K for the year ended December 31, 2018 , or our 2018 Annual Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) considered necessary for a fair statement of results for the interim period have been included. All intercompany transactions and balances with or among our consolidated subsidiaries have been eliminated. Operating results for interim periods are not necessarily indicative of the results that may be expected for the full year. The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect reported amounts. Actual results could differ from those estimates. Significant estimates in the accompanying condensed consolidated financial statements include the fair value of financial instruments. |
Cash, Cash Equivalents and Restricted Cash | Cash, Cash Equivalents and Restricted Cash We consider highly liquid investments with original maturities of three months or less at the date of purchase to be cash equivalents. Restricted cash primarily consists of deposit proceeds from potential borrowers when originating loans, which may be returned to the applicable borrower upon the closing of the loan, after deducting any transaction costs paid by us for the benefit of such borrower. |
Loans Held for Investment | Loans Held for Investment Generally, our loans are classified as held for investment based upon our intent and ability to hold them until maturity. Loans that are held for investment are carried at cost, net of unamortized loan origination and accreted exit fees that are required to be recognized in the carrying value of the loans in accordance with GAAP, unless the loans are deemed to be impaired. Loans that we have a plan to sell or liquidate will be held at the lower of cost or fair value less cost to sell. We evaluate each of our loans for impairment at least quarterly by assessing a variety of risk factors in relation to each loan and assigning a risk rating to each loan based on those factors. Factors considered in these evaluations include, but are not limited to, property type, geographic and local market dynamics, physical condition, leasing and tenant profile, projected cash flow, risk of loss, current loan to value ratio, or LTV, debt yield, collateral performance, structure, exit plan and sponsorship. Loans are rated “1” (less risk) through “5” (greater risk) as defined below: "1" lower risk—Criteria reflects a sponsor having a strong financial condition and low credit risk and our evaluation of management's experience; collateral performance exceeding performance metrics included in the business plan or credit underwriting; and the property demonstrating stabilized occupancy and/or market rates, resulting in strong current cash flow and net operating income and/or having a very low LTV. "2" average risk—Criteria reflects a sponsor having a stable financial condition and our evaluation of management's experience; collateral performance meeting or exceeding substantially all performance metrics included in the business plan or credit underwriting; and the property demonstrating improved occupancy at market rents, resulting in sufficient current cash flow and/or having a low LTV. "3" acceptable risk—Criteria reflects a sponsor having a history of repaying loans at maturity and meeting its credit obligations and our evaluation of management's experience; collateral performance expected to meet performance metrics included in the business plan or credit underwriting; and the property having a moderate LTV. New loans and loans with a limited history will typically be assigned this rating and will be adjusted to other levels from time to time as appropriate. "4" higher risk—Criteria reflects a sponsor having a history of unresolved missed or late payments, maturity extensions and difficulty timely fulfilling its credit obligations and our evaluation of management's experience; collateral performance failing to meet the business plan or credit underwriting; the existence of a risk of default possibly leading to a loss and/or potential weaknesses that deserve management’s attention; and the property having a high LTV. "5" impaired/loss likely—Criteria reflects a very high risk of realizing a principal loss or having incurred a principal loss; a sponsor having a history of default payments, trouble fulfilling its credit obligations, deeds in lieu of foreclosures, and/or bankruptcies; collateral performance is significantly worse than performance metrics included in the business plan; loan covenants or performance milestones having been breached or not attained; timely exit via sale or refinancing being uncertain; and the property having a very high LTV. See Note 4 and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Overview—Our Portfolio” included in Part I, Item 2 of this Quarterly Report on Form 10-Q for a discussion regarding our current loan portfolio’s assessment under our internal risk rating policy. Impairment occurs when it is deemed probable that we will not be able to collect all amounts due under a loan according to its contractual terms. Impairment will then be measured based on the present value of expected future cash flows discounted at the loan’s contractual effective rate and the fair value of any available collateral, net of any costs we expect to incur to realize that value. The determination of whether loans are impaired involves judgments and assumptions based on objective and subjective factors. Consideration will be given to various factors, such as business plans, property occupancies, tenant profiles, rental rates, operating expenses and borrowers’ repayment plans, among others, and will require significant judgments, including assumptions regarding the values of loans, the values of underlying collateral and other circumstances, such as guarantees, if any. Upon measurement of an impairment, we will record an allowance to reduce the carrying value of the loan accordingly, and record a corresponding charge to net income in our condensed consolidated statements of operations. |
Repurchase Agreements | Repurchase Agreements Loans financed through repurchase agreements are treated as collateralized financing transactions, unless they meet sales treatment under GAAP. Pursuant to GAAP treatment of collateralized financing transactions, loans financed through repurchase agreements remain on our condensed consolidated balance sheet as assets, and cash received from the purchasers is recorded on our condensed consolidated balance sheet as liabilities. Interest paid in accordance with repurchase agreements is recorded as interest expense. |
Revenue Recognition | Revenue Recognition Interest income related to our first mortgage whole loans secured by commercial real estate, or CRE, will generally be accrued based on the coupon rates applied to the outstanding principal balance of such loans. Fees, premiums and discounts, if any, will be amortized or accreted into interest income over the remaining lives of the loans using the effective interest method, as adjusted for any prepayments. If a loan's interest or principal payments are not paid when due and there is uncertainty that such payments will be collected, the loan may be categorized as non-accrual and no interest will be recorded unless it is collected. When all overdue payments are collected and, in our judgment, a loan is likely to remain current, it may be re-categorized as accrual. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements In June 2016, the Financial Accounting Standards Board issued Accounting Standards Update, or ASU, No. 2016-13, Financial Instruments - Credit Losses (Topic 326) : Measurement of Credit Losses on Financial Instruments , which requires that entities use a new forward looking “expected loss” model that generally will result in the earlier recognition of allowance for credit losses. The measurement of expected credit losses is based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the reported amount. ASU No. 2016-13 is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years. As an emerging growth company that has opted to take advantage of the extended transition period, we expect to adopt ASU No. 2016-13 on January 1, 2022. We are currently assessing the potential impact the adoption of ASU No. 2016-13 will have in our condensed consolidated financial statements. |
Loans Held for Investment (Tabl
Loans Held for Investment (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Schedule of Loans | The table below details overall statistics for our loan portfolio: Balance at September 30, 2019 Balance at December 31, 2018 Number of loans 10 7 Total loan commitments $ 227,157 $ 154,802 Unfunded loan commitments (1) $ 18,813 $ 17,673 Principal balance $ 208,344 $ 137,129 Unamortized net deferred origination fees $ (880 ) $ (1,285 ) Carrying value $ 207,464 $ 135,844 Weighted average coupon rate 5.85 % 6.14 % Weighted average all in yield (2) 6.51 % 6.82 % Weighted average maximum maturity (years) (3) 3.6 4.7 Weighted average LTV 70 % 70 % (1) Unfunded commitments will primarily be funded to finance property and building improvements and leasing capital. These commitments will generally be funded over the term of each loan. (2) All in yield includes the amortization of deferred fees over the initial term of the loan. (3) Maximum maturity assumes all extension options are exercised, which options are subject to the borrower meeting certain conditions. The table below details our loan activities for the three months ended September 30, 2019 : Principal Balance Deferred Fees Carrying Value Balance at beginning of period $ 260,488 $ (1,531 ) $ 258,957 Additional funding 1,466 — 1,466 Repayments (53,610 ) 449 (53,161 ) Net amortization of deferred fees — 202 202 Balance at end of period $ 208,344 $ (880 ) $ 207,464 The table below details our loan activities for the nine months ended September 30, 2019 : Principal Balance Deferred Fees Carrying Value Balance at beginning of period $ 137,129 $ (1,285 ) $ 135,844 Additional funding 4,835 — 4,835 Originations 119,990 (928 ) 119,062 Repayments (53,610 ) 449 (53,161 ) Net amortization of deferred fees — 884 884 Balance at end of period $ 208,344 $ (880 ) $ 207,464 The tables below detail the property type and geographic distribution of the properties securing the loans included in our portfolio at September 30, 2019 : Property Type Number of Loans Carrying Value Percentage of Value Office 3 $ 56,816 27 % Hotel 1 23,068 11 % Retail 3 40,882 20 % Multifamily 2 51,911 25 % Industrial 1 34,787 17 % 10 $ 207,464 100 % Geographic Location Number of Loans Carrying Value Percentage of Value East 2 $ 59,205 29 % South 5 102,548 49 % West 1 6,376 3 % Midwest 2 39,335 19 % 10 $ 207,464 100 % |
Debt Agreements (Tables)
Debt Agreements (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt Instruments | At September 30, 2019 , our debt agreements included our Master Repurchase Facility. Debt Obligation Weighted Average Collateral Maximum Facility Size Principal Balance Carrying Value Coupon Rate Remaining Maturity (1) (years) Principal Balance Fair Value (2) September 30, 2019: Master repurchase facility $ 213,482 $ 131,253 $ 130,312 L + 2.00% 1.8 $ 208,344 $ 208,647 December 31, 2018: Master repurchase facility $ 135,000 $ 72,582 $ 71,691 L + 2.08% 2.6 $ 97,516 $ 98,232 Note payable 32,290 31,690 31,485 L + 2.15% 2.6 39,613 39,640 (1) The weighted average remaining maturity is determined using the current maturity date of the corresponding loans, excluding extension options. (2) See Note 6 for further discussion of our financial assets and liabilities not carried at fair value. |
Schedule of Maturities of Long-term Debt | At September 30, 2019 , our outstanding borrowings had the following remaining maturities: Year Principal payments on Master Repurchase Facility (1) 2019 $ — 2020 26,395 2021 104,858 2022 — 2023 — $ 131,253 (1) The allocation of our outstanding borrowings under our Master Repurchase Facility is based on the current maturity date of each loan investment with respect to which the individual borrowing relates. |
Fair Value of Financial Instr_2
Fair Value of Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on Recurring Basis | The table below provides information regarding financial assets and liabilities not carried at fair value on a recurring basis in our condensed consolidated balance sheets: September 30, 2019 December 31, 2018 Carrying Value Fair Value Carrying Value Fair Value Financial assets Loans held for investment $ 207,464 $ 208,647 $ 135,844 $ 137,872 Financial liabilities Master Repurchase Facility 130,312 131,253 71,691 72,582 Note payable — — 31,485 31,690 |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Equity [Abstract] | |
Dividends Declared | During the nine months ended September 30, 2019 , we declared and paid regular quarterly distributions to common shareholders as follows: Record Date Payment Date Distribution Per Share Total Distribution January 28, 2019 February 21, 2019 $0.11 $350 April 29, 2019 May 16, 2019 $0.22 $702 July 29, 2019 August 15, 2019 $0.22 $1,802 |
Organization (Details)
Organization (Details) - USD ($) $ / shares in Units, $ in Thousands | May 21, 2019 | Sep. 18, 2017 | Sep. 30, 2019 | Dec. 31, 2018 |
Subsidiary, Sale of Stock [Line Items] | ||||
Common shares of beneficial interest, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |
Price of shares issued (in dollars per share) | $ 5.65 | |||
Proceeds from sale of common shares | $ 26,074 | $ 62,000 | ||
IPO | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of shares issued (in shares) | 2,500,000 | |||
Private Placement | ||||
Subsidiary, Sale of Stock [Line Items] | ||||
Number of shares issued (in shares) | 1,000,000 | 600,000 | ||
Price of shares issued (in dollars per share) | $ 20 |
Loans Held for Investment - Loa
Loans Held for Investment - Loan Portfolio Statistics (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019USD ($)loan | Dec. 31, 2018USD ($)loan | Jun. 30, 2019USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Number of loans | loan | 10 | 7 | |
Total loan commitments | $ 227,157 | $ 154,802 | |
Principal balance | 208,344 | 137,129 | $ 260,488 |
Unamortized net deferred origination fees | (880) | (1,285) | (1,531) |
Carrying value | $ 207,464 | $ 135,844 | $ 258,957 |
Weighted average coupon rate | 5.85% | 6.14% | |
Weighted average all in yield | 6.51% | 6.82% | |
Weighted average maximum maturity | 3 years 7 months 6 days | 4 years 8 months 12 days | |
Weighted average LTV | 0.70 | 0.70 | |
Unfunded commitments | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Unfunded loan commitments | $ 18,813 | $ 17,673 | |
Weighted average maximum maturity | 2 years | ||
First Mortgage Bridge Loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Carrying value | $ 207,464 | $ 135,844 |
Loans Held for Investment - L_2
Loans Held for Investment - Loan Activity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended |
Sep. 30, 2019 | Sep. 30, 2019 | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Movement in Mortgage Loans on Real Estate [Roll Forward] | ||
Principal, beginning balance | $ 260,488 | $ 137,129 |
Deferred fees, beginning balance | (1,531) | (1,285) |
Beginning balance | 258,957 | 135,844 |
Additional funding | 1,466 | 4,835 |
Principal, loan funding | 119,990 | |
Deferred fees, loan funding | (928) | |
Net book value, loan funding | 119,062 | |
Repayments | (53,610) | (53,610) |
Deferred fees | 449 | 449 |
Repayments, net | (53,161) | (53,161) |
Net amortization of deferred fees | 202 | 884 |
Principal, ending balance | 208,344 | 208,344 |
Deferred fees, ending balance | (880) | (880) |
Ending balance | $ 207,464 | $ 207,464 |
Loans Held for Investment - L_3
Loans Held for Investment - Loan Portfolio (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019USD ($)loan | Dec. 31, 2018USD ($)loan | Jun. 30, 2019USD ($) | |
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 10 | 7 | |
Net book value balance | $ | $ 207,464 | $ 135,844 | $ 258,957 |
Percentage of value | 100.00% | ||
East | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 2 | ||
Net book value balance | $ | $ 59,205 | ||
Percentage of value | 29.00% | ||
South | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 5 | ||
Net book value balance | $ | $ 102,548 | ||
Percentage of value | 49.00% | ||
West | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 1 | ||
Net book value balance | $ | $ 6,376 | ||
Percentage of value | 3.00% | ||
Midwest | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 2 | ||
Net book value balance | $ | $ 39,335 | ||
Percentage of value | 19.00% | ||
Office | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 3 | ||
Net book value balance | $ | $ 56,816 | ||
Percentage of value | 27.00% | ||
Hotel | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 1 | ||
Net book value balance | $ | $ 23,068 | ||
Percentage of value | 11.00% | ||
Retail | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 3 | ||
Net book value balance | $ | $ 40,882 | ||
Percentage of value | 20.00% | ||
Multifamily | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 2 | ||
Net book value balance | $ | $ 51,911 | ||
Percentage of value | 25.00% | ||
Industrial | |||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Line Items] | |||
Number of loans | loan | 1 | ||
Net book value balance | $ | $ 34,787 | ||
Percentage of value | 17.00% |
Debt Agreements - Schedule of D
Debt Agreements - Schedule of Debt (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | ||
Carrying Value | $ 131,253 | |
Note payable | ||
Debt Instrument [Line Items] | ||
Maximum Facility Size | $ 32,290 | |
Principal Balance | 31,690 | |
Carrying Value | $ 31,485 | |
Remaining maturity | 2 years 7 months 6 days | |
Collateral, principal balance | $ 39,613 | |
Collateral, fair value | $ 39,640 | |
Note payable | LIBOR | ||
Debt Instrument [Line Items] | ||
Coupon Rate | 2.15% | |
Mortgages and Related Assets | ||
Debt Instrument [Line Items] | ||
Maximum Facility Size | 213,482 | $ 135,000 |
Principal Balance | 131,253 | 72,582 |
Principal Balance | 131,253 | |
Carrying Value | $ 130,312 | $ 71,691 |
Maturity of repurchase agreement | P1Y9M18D | P2Y7M6D |
Collateral, principal balance | $ 208,344 | $ 97,516 |
Collateral, fair value | $ 208,647 | $ 98,232 |
Mortgages and Related Assets | LIBOR | ||
Debt Instrument [Line Items] | ||
Interest rate | 2.00% | 2.08% |
Debt Agreements - Notes Payable
Debt Agreements - Notes Payable (Details) | Aug. 09, 2019USD ($) | May 21, 2019USD ($) | Feb. 04, 2019USD ($) | Jul. 27, 2018 | May 31, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | May 03, 2019USD ($) | Jul. 31, 2018USD ($)keystory |
Debt Instrument [Line Items] | |||||||||||
Payoff amount | $ 31,690,000 | $ 0 | |||||||||
Hampton Inn JFK | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Loan amount | $ 40,363,000 | ||||||||||
Number of keys in building | key | 216 | ||||||||||
Number of stories in building | story | 13 | ||||||||||
Note payable | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Funding of loan | $ 39,613,000 | ||||||||||
Principal Balance | $ 31,690,000 | ||||||||||
Note payable | Hampton Inn JFK | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Funding of loan | $ 39,613,000 | ||||||||||
Payoff amount | $ 39,922,000 | ||||||||||
Note payable | LIBOR | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable rate | 2.15% | ||||||||||
RMR Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Proceeds from RMR credit agreement | $ 14,220,000 | $ 14,220,000 | |||||||||
Interest expense | 39,000 | 39,000 | |||||||||
Borrowing amount | $ 25,000,000 | $ 50,000,000 | |||||||||
Debt instrument fee | $ 7,000 | ||||||||||
RMR Credit Agreement | LIBOR | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable rate | 6.50% | ||||||||||
TCB Loan | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest expense | $ 155,000 | $ 891,000 | |||||||||
TCB Loan | Note payable | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Payoff amount | $ 31,790,000 | ||||||||||
Percent of collateral eligible to be advanced | 80.00% | ||||||||||
Percentage of loan guaranteed | 25.00% | ||||||||||
TCB Loan | Note payable | LIBOR | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Variable rate | 2.15% |
Debt Agreements - Master Repurc
Debt Agreements - Master Repurchase Facility (Details) - USD ($) | Aug. 23, 2019 | May 21, 2019 | Feb. 09, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | May 01, 2019 | Feb. 04, 2019 | Dec. 31, 2018 | Nov. 06, 2018 | Jul. 31, 2018 |
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Proceeds from master repurchase facility | $ 92,983,000 | $ 21,583,000 | ||||||||||
Payoff amount | 34,312,000 | $ 0 | ||||||||||
Available amount | $ 24,203,000 | 24,203,000 | ||||||||||
Unused borrowing capacity | 58,026,000 | 58,026,000 | ||||||||||
Mortgages and Related Assets | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Interest expense for repurchase agreement | 1,563,000 | 4,126,000 | ||||||||||
Authorized amount | $ 213,482,000 | $ 213,482,000 | $ 135,000,000 | |||||||||
Debt, weighted average interest rate | 4.27% | 4.35% | 4.42% | 4.34% | ||||||||
Collateral, principal balance | $ 208,344,000 | $ 208,344,000 | 97,516,000 | |||||||||
Payoff amount | $ 11,900,000 | |||||||||||
Citibank, N.A. | Mortgages and Related Assets | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Authorized amount | $ 100,000,000 | $ 250,000,000 | $ 210,000,000 | $ 135,000,000 | ||||||||
Percentage of purchased asset, initial purchase price | 75.00% | |||||||||||
Minimum percentage of margin to advance | 75.00% | |||||||||||
Note payable | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Collateral, principal balance | $ 39,613,000 | |||||||||||
Note payable | Scarsdale, NY | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Proceeds from master repurchase facility | $ 14,635,000 | |||||||||||
Collateral, principal balance | 13,997,000 | |||||||||||
Payoff amount | 10,422,000 | |||||||||||
Note payable | Hampton Inn JFK | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Collateral, principal balance | $ 39,613,000 | |||||||||||
Payoff amount | $ 8,000,000 | |||||||||||
LIBOR | Citibank, N.A. | Mortgages and Related Assets | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Variable basis spread | 2.00% | |||||||||||
LIBOR | Citibank, N.A. | Minimum | Mortgages and Related Assets | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Variable basis spread | 2.00% | |||||||||||
LIBOR | Citibank, N.A. | Maximum | Mortgages and Related Assets | ||||||||||||
Assets Sold under Agreements to Repurchase [Line Items] | ||||||||||||
Variable basis spread | 2.50% |
Debt Agreements - Debt Maturiti
Debt Agreements - Debt Maturities (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Mortgages and Related Assets | ||
Debt Instrument [Line Items] | ||
2019 | $ 0 | |
2020 | 26,395 | |
2021 | 104,858 | |
2022 | 0 | |
2023 | 0 | |
Total | $ 131,253 | |
Note payable | ||
Debt Instrument [Line Items] | ||
Total | $ 31,690 |
Fair Value of Financial Instr_3
Fair Value of Financial Instruments - Recurring Fair Value (Details) - Level III - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for investment | $ 208,647 | $ 137,872 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Loans held for investment | 207,464 | 135,844 |
Master repurchase agreement | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial liabilities | 131,253 | 72,582 |
Master repurchase agreement | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial liabilities | 130,312 | 71,691 |
Note payable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial liabilities | 0 | 31,690 |
Note payable | Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Financial liabilities | $ 0 | $ 31,485 |
Shareholders' Equity (Details)
Shareholders' Equity (Details) $ / shares in Units, $ in Thousands | Oct. 17, 2019USD ($)$ / shares | Sep. 25, 2019$ / shares | Sep. 18, 2019$ / sharesshares | Aug. 15, 2019USD ($)$ / shares | Jul. 03, 2019$ / sharesshares | May 21, 2019USD ($)$ / sharesshares | May 16, 2019USD ($)$ / shares | Apr. 24, 2019trustee$ / sharesshares | Apr. 05, 2019$ / sharesshares | Feb. 21, 2019USD ($)$ / shares | Sep. 18, 2017USD ($)$ / sharesshares | May 31, 2019USD ($) | Sep. 30, 2019USD ($) | Jun. 30, 2019USD ($) | Mar. 31, 2019USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) |
Subsidiary, Sale of Stock [Line Items] | |||||||||||||||||
Price of shares issued (in dollars per share) | $ 5.65 | ||||||||||||||||
Proceeds from sale of common shares | $ | $ 26,074 | $ 62,000 | |||||||||||||||
Reduction in outstanding borrowings | $ | $ 34,312 | $ 0 | |||||||||||||||
Shares paid for tax withholding (in shares) | shares | 704 | 644 | |||||||||||||||
Shares paid for tax withholding (in dollars per share) | $ 4.82 | $ 4.03 | $ 9.39 | ||||||||||||||
Shares granted (in shares) | shares | 53,300 | ||||||||||||||||
Shares granted (in dollars per share) | $ 5,712 | $ 4.55 | |||||||||||||||
Distributions paid (in dollars per share) | $ 0.22 | $ 0.22 | $ 0.11 | ||||||||||||||
Distributions | $ | $ 1,802 | $ 702 | $ 350 | $ 1,802 | $ 702 | $ 350 | |||||||||||
Fully Vested Common Shares | Trustee | |||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||||||
Shares granted (in shares) | shares | 3,000 | ||||||||||||||||
Shares granted (in dollars per share) | $ 10.36 | ||||||||||||||||
Number of trustees | trustee | 5 | ||||||||||||||||
Subsequent event | |||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||||||
Distributions | $ | $ 1,813 | ||||||||||||||||
Distributions declared (in dollars per share) | $ 0.22 | ||||||||||||||||
May 2019 Offering | |||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||||||
Number of shares issued (in shares) | shares | 5,000,000 | ||||||||||||||||
Private Placement | |||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||||||
Number of shares issued (in shares) | shares | 1,000,000 | 600,000 | |||||||||||||||
Price of shares issued (in dollars per share) | $ 20 | ||||||||||||||||
Mortgages and Related Assets | |||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||||||
Reduction in outstanding borrowings | $ | $ 11,900 | ||||||||||||||||
RMR Credit Agreement | |||||||||||||||||
Subsidiary, Sale of Stock [Line Items] | |||||||||||||||||
Proceeds from RMR credit agreement | $ | $ 14,220 | $ 14,220 |
Management Agreement with our_2
Management Agreement with our Manager (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($)employee | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)employee | Sep. 30, 2018USD ($) | |
Related Party Transaction [Line Items] | ||||
Number of employees | employee | 0 | 0 | ||
Management fees, including waived fees | $ 322 | $ 222 | $ 812 | $ 669 |
Management fees | 0 | 0 | 0 | 447 |
Reimbursement of shared services expenses | $ 370 | 375 | $ 1,110 | 1,125 |
Principal Owner | ||||
Related Party Transaction [Line Items] | ||||
Management fees | $ 0 | $ 447 |
Related Person Transactions (De
Related Person Transactions (Details) - shares | May 21, 2019 | Sep. 18, 2017 | Sep. 30, 2019 |
Tremont Mortgage Trust | Tremont Realty Advisors LLC | |||
Related Party Transaction [Line Items] | |||
Ownership percentage | 100.00% | ||
Shares owned (in shares) | 1,600,100 | ||
Noncontrolling ownership interest | 19.40% | ||
Private Placement | |||
Related Party Transaction [Line Items] | |||
Number of shares issued (in shares) | 1,000,000 | 600,000 |
Weighted Average Common Shares
Weighted Average Common Shares (Details) - shares shares in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Restricted unvested common shares | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Antidilutive securities (in shares) | 39,024 | 2,204 | 15,037 | 1,071 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Loans and Leases Receivable Disclosure [Line Items] | ||
Weighted average maximum maturity | 3 years 7 months 6 days | 4 years 8 months 12 days |
Borrowings outstanding | $ 131,253 | |
Weighted average maturity | 1 year 9 months 18 days | |
Unfunded commitments | ||
Loans and Leases Receivable Disclosure [Line Items] | ||
Unfunded commitments | $ 18,813 | $ 17,673 |
Weighted average maximum maturity | 2 years |