Lodging Fund Reit Iii 10-Q 14 May 20 2020 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2020	May 14, 2020
Document and Entity Information [Abstract]
Document Type	10-Q
Document Period End Date	Mar. 31, 2020
Entity Registrant Name	LODGING FUND REIT III, INC.
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	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		7,136,866
Entity Central Index Key	0001745032
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2020
Document Fiscal Period Focus	Q1
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Assets
Investment in hotel properties, net of accumulated depreciation of $2,074,113 and $1,255,712	$ 101,975,846	$ 65,408,308
Cash and cash equivalents	7,934,605	10,898,556
Restricted cash	4,689,155	5,275,815
Accounts receivable, net	96,509	107,976
Franchise fees, net	1,005,718	721,690
Prepaid expenses and other assets	1,860,521	1,623,584
Total Assets	117,562,354	84,035,929
Liabilities and Equity
Debt, net	69,018,909	40,980,632
Accounts payable	683,677	543,669
Accrued expenses	1,435,884	925,265
Due to related parties	338,883	966,379
Other liabilities	301,765	434,974
Total liabilities	71,779,118	43,850,919
Commitments and contingencies (See Note 10)
Equity
Preferred stock, $0.01 par value, 100,000,000 shares authorized; no shares issued and outstanding
Common stock, $0.01 par value, 900,000,000 shares authorized; 6,996,670 and 6,005,743 shares issued and outstanding	69,966	60,057
Additional paid-in capital	68,659,011	58,961,101
Accumulated deficit	(22,376,292)	(18,396,163)
Total stockholders' equity	46,352,685	40,624,995
Non-controlling interest	(569,449)	(439,985)
Total equity	45,783,236	40,185,010
Total Liabilities and Equity	$ 117,562,354	$ 84,035,929

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
CONSOLIDATED BALANCE SHEETS
Accumulated depreciation	$ 2,074,113	$ 1,255,712
Preferred stock, Par Value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized	100,000,000	100,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized	900,000,000	900,000,000
Common stock, shares issued	6,996,670	6,005,743
Common stock, shares outstanding	6,996,670	6,005,743

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Revenues
Revenues	$ 3,832,506	$ 604,490
Expenses
General and administrative	1,388,284	655,151
Sales and marketing	371,070	176,562
Property operations	1,650,313	250,698
Franchise fees	319,901	54,085
Property management fees	395,204	59,898
Acquisition expense	72,995	188,121
Depreciation	818,401	103,589
Total expenses	5,016,168	1,488,104
Other Income (Expense)
Other income (expense), net	(72,524)	(40,023)
Interest expense	(735,766)	(161,502)
Total other income (expense)	(808,290)	(201,525)
Net Loss Before Income Taxes	(1,991,952)	(1,085,139)
Income tax benefit	607,916	59,556
Net loss	(1,384,036)	(1,025,583)
Net loss attributable to non-controlling interest	(69,156)	(50,563)
Net Loss Attributable to Common Stockholders	$ (1,314,880)	$ (975,020)
Basic and Diluted Net Loss Per Share of Common Stock	$ (0.20)	$ (0.65)
Weighted-average Shares of Common Stock Outstanding, Basic and Diluted	6,539,024	1,504,416
Room
Revenues
Revenues	$ 3,777,730	$ 601,289
Other
Revenues
Revenues	$ 54,776	$ 3,201

CONSOLIDATED STATEMENTS OF CHAN

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($)	Common Stock	Additional Paid-In Capital	Accumulated Deficit	Total Stockholder's Equity	Non-controlling Interest	Total
Balance - Beginning at Dec. 31, 2018	$ 11,350	$ 11,083,985	$ (4,041,428)	$ 7,053,907	$ (69,217)	$ 6,984,690
Balance - Beginning (Shares) at Dec. 31, 2018	1,135,010
Issuance of common stock	$ 7,895	7,814,616		7,822,511		7,822,511
Issuance of common stock (Shares)	789,455
Offering costs			(1,628,239)	(1,628,239)		(1,628,239)
Distributions declared			(266,076)	(266,076)	(14,004)	(280,080)
Distributions reinvested	$ 123	115,352		115,475		115,475
Distributions reinvested (Shares)	12,269
Net loss			(975,020)	(975,020)	(50,563)	(1,025,583)
Balance - Ending at Mar. 31, 2019	$ 19,368	19,013,953	(6,910,763)	12,122,558	(133,784)	11,988,774
Balance - Ending (Shares) at Mar. 31, 2019	1,936,734
Balance - Beginning at Dec. 31, 2019	$ 60,057	58,961,101	(18,396,163)	40,624,995	(439,985)	40,185,010
Balance - Beginning (Shares) at Dec. 31, 2019	6,005,743
Issuance of common stock	$ 9,569	9,371,964		9,381,533		9,381,533
Issuance of common stock (Shares)	956,897
Offering costs			(1,520,647)	(1,520,647)		(1,520,647)
Distributions declared			(1,144,602)	(1,144,602)	(60,308)	(1,204,910)
Distributions reinvested	$ 440	417,846		418,286		418,286
Distributions reinvested (Shares)	44,030
Redemptions	$ (100)	(91,900)		(92,000)		(92,000)
Redemptions (Shares)	(10,000)
Net loss			(1,314,880)	(1,314,880)	(69,156)	(1,384,036)
Balance - Ending at Mar. 31, 2020	$ 69,966	$ 68,659,011	$ (22,376,292)	$ 46,352,685	$ (569,449)	$ 45,783,236
Balance - Ending (Shares) at Mar. 31, 2020	6,996,670

CONSOLIDATED STATEMENTS OF CH_2

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
Distributions declared (in dollars per share)	$ 0.175	$ 0.175

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019
Cash Flows from Operating Activities:
Net loss	$ (1,384,036)	$ (1,025,583)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation	818,401	103,589
Amortization	58,352	29,231
Write-off of unamortized deferred financing costs		25,629
Change in operating assets and liabilities:
Accounts receivable	11,467	(21,844)
Franchise fees	(300,000)	(175,000)
Prepaid expenses and other assets	(236,937)	213,946
Accounts payable	147,028	87,316
Accrued expenses	496,689	(96,979)
Due to related parties	(623,882)	(365,516)
Other liabilities	(129,055)	10,211
Net cash used in operating activities	(1,141,973)	(1,215,000)
Cash Flows from Investing Activities:
Acquisitions of hotel properties	(27,190,749)	(4,276,945)
Improvements and additions to hotel properties	(196,753)	(157,518)
Net cash used in investing activities	(27,387,502)	(4,434,463)
Cash Flows from Financing Activities:
Proceeds from mortgage debt	13,597,819	5,278,868
Proceeds from lines of credit	6,200,000	500,000
Principal payments on mortgage debt	(170,941)	(13,466)
Principal payments on lines of credit	(1,000,000)	(5,229,000)
Payments of deferred financing costs	(633,572)	(301,960)
Proceeds from issuance of common stock	9,381,533	7,822,511
Payments of offering costs	(1,612,371)	(1,359,395)
Payments for shares redeemed	(92,000)
Distributions paid	(691,604)	(98,912)
Net cash provided by financing activities	24,978,864	6,598,646
Net change in cash, cash equivalents, and restricted cash	(3,550,611)	949,183
Beginning Cash, Cash Equivalents, and Restricted Cash	16,174,371	4,032,404
Ending Cash, Cash Equivalents, and Restricted Cash	12,623,760	4,981,587
Supplemental Disclosure of Cash Flow Information:
Interest paid	577,708	102,972
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Debt assumed in connection with hotel property acquisition	9,998,437	9,424,156
Offering costs included in accounts payable	(7,020)	170,845
Offering costs included in due to related parties	(63,922)	97,999
Offering costs included in accrued expenses	(20,782)
Distributions included in accrued expenses	34,712	60,119
Distributions included in due to related parties	60,308	5,574
Reinvested distributions	418,286	115,475
Reconciliation of Cash, Cash Equivalents, and Restricted Cash:
Cash and cash equivalents, beginning of period	10,898,556	3,732,404
Restricted cash, beginning of period	5,275,815	300,000
Cash, cash equivalents, and restricted cash, beginning of period	12,623,760	4,981,587
Cash and Cash Equivalents, at Carrying Value, Ending Balance	7,934,605	2,679,089
Restricted cash, end of period	4,689,155	2,302,498
Cash, cash equivalents, and restricted cash, end of period	$ 12,623,760	$ 4,981,587

ORGANIZATION

ORGANIZATION	3 Months Ended
	Mar. 31, 2020
ORGANIZATION
ORGANIZATION	1. ORGANIZATION Lodging Fund REIT III, Inc. (“LF REIT III”), was formed on April 9, 2018 as a Maryland corporation. LF REIT III, together with its subsidiaries (the “Company”), was formed for the principal purpose of acquiring, through purchase or contribution, direct or indirect ownership interests in a diverse portfolio of limited-service, select-service and extended stay hotel properties located primarily in “America’s Heartland,” which the Company defines as the geographic area from North Dakota to Texas and the Appalachian Mountains to the Rocky Mountains. LF REIT III has elected to be treated as a real estate investment trust, or REIT, for federal income tax purposes beginning with the taxable year ended December 31, 2018. The Company’s business activities are directed and managed by Legendary Capital REIT III, LLC (the “Advisor”) and its affiliates, which are related parties through common management, pursuant to the Amended and Restated Advisory Agreement (the “Advisory Agreement”), dated June 1, 2018. The Company has no foreign operations or assets and its operating structure includes only one operating and reportable segment. Substantially all of the Company’s assets and liabilities are held by, and substantially all of its operations are conducted through, Lodging Fund REIT III OP, LP (the “Operating Partnership,” or “OP”), a subsidiary of LF REIT III. The OP has two voting classes of partnership units, General Partnership Units and Common Limited Partnership Units, and one class of non-voting partnership units, Series B Limited Partnership Units. LF REIT III was the sole general partner of the OP, as of March 31, 2020 and December 31, 2019. As of March 31, 2020 and December 31, 2019, there were no outstanding Common Partnership Units, and there were 1,000 outstanding Series B Limited Partnership Units, all of which were owned by the Advisor. On June 1, 2018, the Company commenced a private offering of shares of common stock, $0.01 par value per share, with a maximum offering of $100,000,000 (the “Offering”) to accredited investors only, pursuant to a confidential private placement memorandum exempt from registration under the Securities Act of 1933, as amended. In addition to sales of common shares for cash, the Company has adopted a dividend reinvestment plan (“DRIP”), which permits stockholders to reinvest their distributions back into the Company. As of March 31, 2020, the Company had issued and sold 6,996,670 shares of common stock, including 133,331 shares attributable to the DRIP, and received aggregate proceeds of $68.7 million.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation and Principles of Consolidation —The accompanying unaudited consolidated financial statements and related notes have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the SEC applicable to interim financial information. Accordingly, the unaudited financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. The financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, and which, in the opinion of management, are necessary for a fair and consistent presentation of the results for such periods. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. The consolidated financial statements include the accounts of LF REIT III, the OP and its wholly-owned subsidiaries. For the controlled subsidiaries that are not wholly-owned, the interests owned by an entity other than the Company represent a noncontrolling interest, which is presented separately in the consolidated financial statements. The Company has no foreign operations or assets and its operating structure includes only one reportable Segment. All intercompany balances and transactions have been eliminated in consolidation. Use of Estimates —The preparation of the Company’s consolidated financial statements and the accompanying notes in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities and the amounts of contingent assets and liabilities at the balance sheet date and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. During the first quarter of 2020, there was a global outbreak of a novel coronavirus, or COVID-19, which has spread to over 200 countries and territories, including the United States, and has spread to every state in the United States. The World Health Organization has designated COVID-19 as a pandemic, and numerous countries, including the United States, have declared national emergencies with respect to COVID-19. The impact of the outbreak on the U.S. and world economies has been rapidly evolving, and as cases of COVID-19 have continued to be identified in additional countries, there have been international mandates, and mandates in the United States from federal, state and local authorities, instituting quarantines and stay-at-home orders, closing schools, and instituting restrictions on travel and/or limiting operations of non-essential offices and retail centers. Such actions are adversely impacting many industries, with the travel and hospitality industries being particularly adversely affected. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19 on economic and market conditions. The Company believes the estimates and assumptions underlying the Company’s consolidated financial statements are reasonable and supportable based on the information available as of March 31, 2020, however uncertainty over the ultimate impact COVID-19 will have on the global economy generally, and the Company’s business in particular, makes any estimates and assumptions as of March 31, 2020 inherently less certain than they would be absent the current and potential impacts of COVID-19. Revenue Recognition —Revenues consist of amounts derived from hotel operations, including room sales and other hotel revenues, and are presented on a disaggregated basis in the Company’s consolidated statements of operations. These revenues are recorded net of any sales and occupancy taxes collected from the hotel guests. All revenues are recorded on an accrual basis as they are earned. Any cash received prior to a guest’s arrival is recorded as an advance deposit from the guest and recognized as revenue at the time of the guest’s occupancy at the hotel property. Investment in Hotel Properties —The Company evaluates whether each hotel property acquisition should be accounted for as an asset acquisition or a business combination. If substantially all of the fair value of the gross assets acquired is concentrated in a single asset or a group of similar identifiable assets, then the transaction is considered to be an asset acquisition. All of the Company’s acquisitions since inception have been determined to be asset acquisitions. Transaction costs associated with asset acquisitions are capitalized and transaction costs associated with business combinations would be expensed as incurred. The Company’s acquisitions generally consist of land, land improvements, buildings, building improvements, and furniture, fixtures and equipment (“FF&E”). The Company may also acquire intangible assets or liabilities related to in-place leases, management agreements, debt, and advanced bookings. For transactions determined to be asset acquisitions, the Company allocates the purchase price among the assets acquired and the liabilities assumed on a relative fair value basis at the date of acquisition. The Company determines the fair value of assets acquired and liabilities assumed with the assistance of third-party valuation specialists, using cash flow analysis as well as available market and cost data. The determination of fair value includes making numerous estimates and assumptions. The difference between the fair value and the face value of debt assumed in connection with an acquisition is recorded as a premium or discount and amortized to interest expense over the remaining term of the debt assumed. The valuation of assumed debt liabilities is based on our estimate of the current market rates for similar liabilities in effect at the acquisition date. The Company’s investments in hotel properties are carried at cost and are depreciated using the straight-line method over the estimated useful lives of 15 years for land improvements, 15 years for building improvements, 40 years for buildings and three to seven years for FF&E. Maintenance and repair costs are expensed in the period incurred and major renewals or improvements to the hotel properties are capitalized. Interest incurred in connection with the financing of real estate under development or renovation is capitalized as an additional cost of development. The Company discontinues the capitalization of interest once the real estate development or renovation project is substantially complete. The Company assesses the carrying value of its hotel properties whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. The recoverability is measured by comparing the carrying amount of the property to the estimated future undiscounted cash flows of the property, which take into account current market conditions and the Company’s intent with respect to holding or disposing of the hotel properties. If the Company’s analysis indicates that the carrying value is not recoverable on an undiscounted cash flow basis, the Company will recognize an impairment loss for the amount by which the carrying value exceeds the fair value. The fair value is determined through various valuation techniques, including internally developed discounted cash flow models, comparable market transactions or third-party appraisals. The use of projected future cash flows is based on assumptions that are consistent with a market participant’s future expectations for the industry and the economy in general and the Company’s expected use of the underlying hotel properties. The assumptions and estimates related to the future cash flows and the capitalization rates are complex and subjective in nature. Changes in economic and operating conditions, including those occurring as a result of the impact of the COVID-19 pandemic, that occur subsequent to a current impairment analysis and the Company’s ultimate use of the hotel property could impact the assumptions and result in future impairment losses to the hotel properties. Non-controlling Interest —Non-controlling interests represent the portion of equity in a subsidiary held by owners other than the Company. Non-controlling interests are reported in the consolidated balance sheets within equity, separate from stockholders’ equity. Revenue and expenses attributable to both the Company and the non-controlling interests are reported in the consolidated statements of operations, with net income or loss attributable to non-controlling interests reported separately from net income or loss attributable to the Company. Cash and Cash Equivalents —Cash and cash equivalents include cash in bank accounts as well as highly liquid investments with an original maturity of three months or less. The Company deposits cash with several high-quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to an insurance limit of $250,000. At times, the Company’s cash and cash equivalents may exceed federally insured levels. Restricted Cash —Restricted cash consists of earnest money deposits related to hotel property acquisitions, as well as certain funds maintained in escrow accounts to fund future payments for insurance, property tax obligations, and reserves for future capital expenditures, as required by our debt agreements. As of March 31, 2020 and December 31, 2019, restricted cash on the accompanying consolidated balance sheets included $1.7 million and $2.6 million, respective, of earnest money deposits. Accounts Receivable —Accounts receivable consist primarily of receivables due from hotel guests for room stays and meeting and banquet room rentals, which are uncollateralized customer obligations. Management determines the likelihood of collectability of receivables on an individual customer basis, based on the amount of time the balance has been outstanding, likelihood of collecting, and the customer’s current economic status. The carrying amount of the accounts receivables is reduced by a valuation allowance that reflects management’s best estimate of the amounts that will not be collected. Deferred Financing Costs —Deferred financing costs represent commitment fees, origination fees, legal fees, and other costs associated with obtaining financing. Deferred financing costs are presented on the consolidated balance sheets as a direct deduction from the carrying amount of the related debt liability. These costs are amortized to interest expense over the terms of the respective financing agreements using the straight-line method, which approximates the effective interest method. The Company expenses unamortized deferred financing costs when the associated financing agreement is refinanced or repaid before maturity unless certain criteria are met that would allow for the carryover of such costs to the refinanced agreement. Costs incurred in connection with potential financial transactions that are not completed are expensed in the period in which it is determined the financing will not be completed. Offering Costs —The Company has incurred certain costs related directly to the Company’s private offering consisting of, among other costs, commissions, legal, due diligence costs, printing, marketing, filing fees, postage, data processing fees, and other offering related costs. These costs are capitalized and recorded as a reduction of equity proceeds on the accompanying consolidated balance sheets. Property Operations Expenses —Property operations expenses consist of expenses related to room rental, food and beverage sales, telephone usage, and other miscellaneous service costs, as well as all costs of operating the Company’s hotel properties such as building repairs, maintenance, property taxes, utilities, and other related costs. Property Management Fees —Property management fees include expenses incurred for management services provided for the day-to-day operations of our hotel properties, which are generally charged at a rate of 4% of gross revenues. Property management fees also include asset management fees, which may be charged at an annual rate of up to 0.75% of gross assets and are paid to the Advisor. For the three months ended March 31, 2020 and 2019, asset management fees were charged only on the value of investments in hotel properties. Franchise Fees —The Company pays initial fees related to hotel franchise rights prior to acquiring a hotel property. The fees are included in prepaid expenses and other assets until the time the related hotel property is acquired. Initial franchise fees related to hotel properties that are acquired are amortized on a straight-line basis over the life of the agreement. Initial franchise fees related to hotel properties that are not acquired are refunded to the Company, net of any associated fees, and any fees are expensed as incurred. Franchise fees on the accompanying consolidated statements of operations include the amortization of initial franchise fees, as well as monthly fees paid to franchisors for royalty, marketing, and reservation fees and other related costs. Acquisition Costs —The Company incurs costs during the review of potential hotel property acquisitions including legal fees, environmental reviews, market studies, financial advisory services, and other professional service fees. If the Company does complete a property acquisition, an acquisition fee of up to 1.4% is charged by the Advisor, based on the purchase price of the property plus any estimated property improvement plan (“PIP”) costs. For transactions determined to be asset acquisitions, these costs are capitalized as part of the overall cost of the project if the property is ultimately acquired. For transactions determined to be business combinations, these costs would be expensed in the period incurred. Acquisition-related and acquisition due diligence costs that relate to a property that is not acquired, are expensed and included in acquisition costs on the accompanying consolidated statements of operations. Prior to the ultimate determination of whether a property will be acquired or not, acquisition-related and acquisition due diligence costs are recorded as, and included in, prepaid expenses and other assets on the accompanying consolidated balance sheets. Net Loss Per Share of Common Stock —Basic net loss per common share is computed based upon the weighted average number of shares outstanding during the period. Diluted net loss per common share is calculated after giving effect to all potential common shares that were dilutive and outstanding for the period. Basic and diluted net loss per common share were the same for the periods presented. Income Taxes —The Company has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement that it distribute at least 90% of its REIT taxable income, subject to certain adjustments and excluding any net capital gain, to stockholders. The Company’s intention is to adhere to the REIT qualification requirements and to maintain its qualification for taxation as a REIT. As a REIT, the Company is generally not subject to U.S. federal corporate income tax on the portion of taxable income that is distributed to stockholders. If the Company fails to qualify for taxation as a REIT in any taxable year, the Company will be subject to U.S. federal income taxes at regular corporate rates and it may not be able to qualify as a REIT for four subsequent taxable years. As a REIT, the Company may be subject to certain state and local taxes on its income and property, and to U.S. federal income and excise taxes on undistributed taxable income. Taxable income from non-REIT activities managed through the Company’s taxable REIT subsidiary (“TRS”) is subject to U.S. federal, state, and local income taxes at the applicable rates. The TRS accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax basis, and for net operating loss, capital loss and tax credit carryforwards. The deferred tax assets and liabilities are measured using the enacted income tax rates in effect for the year in which those temporary differences are expected to be realized or settled. The effect on the deferred tax assets and liabilities from a change in tax rates is recognized in earnings in the period when the new rate is enacted. However, deferred tax assets are recognized only to the extent that it is more likely than not that they will be realized based on consideration of all available evidence, including the future reversals of existing taxable temporary differences, future projected taxable income and tax planning strategies. Valuation allowances are provided if, based upon the weight of the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company performs periodic reviews for any uncertain tax positions and, if necessary, will record the expected future tax consequences of uncertain tax positions in the consolidated financial statements. Fair Value Measurement —The Company establishes fair value measures based on the fair value definition and hierarchy levels established by GAAP. These fair values are based on a three-tiered fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1 —Observable inputs such as quoted prices in active markets. Level 2 —Directly or indirectly observable inputs, other than quoted prices in active markets. Level 3 —Unobservable inputs in which there is little or no market data, which require a reporting entity to develop its own assumptions. The Company’s estimates of fair value were determined using available market information and appropriate valuation methods. Considerable judgment is necessary to develop estimated fair value. The use of different market assumptions or estimation methods may have a material effect on the estimated fair value amounts. The Company classifies assets and liabilities in the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. Recent Accounting Pronouncements —The Company, as an emerging growth company, has elected to use the extended transition period which allows us to defer the adoption of new or revised accounting standards. This allows the Company to adopt new or revised accounting standards as of the effective date for non-public business entities. In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014‑09, Revenue from Contracts with Customers (Topic 606). The core principle of the new standard is that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014‑09 is effective for fiscal years beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. The Company adopted ASU 2014‑09 as of January 1, 2019 and has applied it on a modified retrospective basis. Based on the Company’s completed assessment of this updated accounting guidance, it does not materially affect the amount or timing of revenue recognition for the Company and the Company did not recognize any cumulative-effect adjustment as a result of adoption. In February 2016, the FASB issued ASU No. 2016‑02, “Leases” (“ASU No. 2016‑02”) (Topic 842), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU No. 2016‑02 requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right of use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales type leases, direct financing leases and operating leases. ASU No. 2016‑02 is effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. We plan to adopt ASU 2016‑02 for the year ending December 31, 2021. We do not anticipate any reclassifications or significant impacts on our consolidated financial statements as a result of this adoption.

INVESTMENT IN HOTEL PROPERTIES

INVESTMENT IN HOTEL PROPERTIES	3 Months Ended
	Mar. 31, 2020
INVESTMENT IN HOTEL PROPERTIES
INVESTMENT IN HOTEL PROPERTIES	3. INVESTMENT IN HOTEL PROPERTIES Investment in hotel properties as of March 31, 2020 and December 31, 2019 consisted of the following: March 31, December 31, 2020 2019 Land and land improvements $ 10,314,661 $ 7,738,495 Building and building improvements 84,575,847 53,238,276 Furniture, fixtures, and equipment 8,708,360 5,687,249 Construction in progress 451,091 — Investment in hotel properties, at cost 104,049,959 66,664,020 Less: accumulated depreciation (2,074,113) (1,255,712) Investment in hotel properties, net $ 101,975,846 $ 65,408,308 As of March 31, 2020, the Company owned seven hotel properties with an aggregate of 706 rooms located in six states. Acquisitions of Hotel Properties The Company acquired two properties during the three months ended March 31, 2020 and four properties during the year ended December 31, 2019. Each of the Company’s hotel acquisitions to date have been determined to be asset acquisitions. The table below outlines the details of the properties acquired during the three months ended March 31, 2020. 2020 Acquisitions Number Date of Guest Purchase Transaction % Hotel Property Type Location Acquired Rooms Price Costs Total Interest Fairfield Inn & Suites Limited Service Lubbock, TX January 8, 2020 101 $ 15,150,000 $ 496,431 $ 15,646,431 100 % Homewood Suites Extended Stay Southaven, MS February 21, 2020 99 20,500,000 445,090 20,945,090 100 % 200 $ 35,650,000 $ 941,521 $ 36,591,521 The table below outlines the details of the properties acquired during the year ended December 31, 2019. 2019 Acquisitions Number Date of Guest Purchase Transaction % Hotel Property Type Location Acquired Rooms Price Costs Total Interest Hampton Inn & Suites Limited Service Pineville, NC March 19, 2019 111 $ 13,897,358 $ 303,744 $ 14,201,102 100 % Hampton Inn Limited Service Eagan, MN June 19, 2019 122 13,950,000 278,333 14,228,333 100 % Home2 Suites Extended Stay Prattville, AL July 11, 2019 90 14,750,000 356,014 15,106,014 100 % Home2 Suites Extended Stay Lubbock, TX December 30, 2019 100 14,150,000 284,776 14,434,776 100 % 423 $ 56,747,358 $ 1,222,867 $ 57,970,225 Each of the hotel properties listed above, except one, is subject to a property management agreement with NHS, LLC dba National Hospitality Services (“NHS”) with an initial term expiring on December 31st of the fifth full calendar year following the effective date of the agreement, which will automatically renew for successive 5‑year periods unless terminated earlier in accordance with its terms. The Pineville Property is currently being managed on a day-to-day basis by Beacon IMG, Inc. (“Beacon”), an affiliate of the seller of the Pineville Property, pursuant to a sub-management agreement. The Southaven Property is currently being managed on a day-to-day basis by Vista Host, Inc. pursuant to a property management agreement with an initial term expiring on February 21, 2025, which will automatically renew for two successive 5-year periods unless terminated earlier in accordance with its terms. The seller of the Pineville Property, an affiliate of Beacon, may be entitled to additional cash consideration if the property exceeds certain performance criteria based on increases in the property’s net operating income (“NOI”) for a selected 12‑month period of time. At any time during the period beginning April 1, 2021 through the date of the final NOI determination (on or about April 30, 2023), the seller of the property may make a one-time election to receive the additional consideration. The variable amount of the additional consideration, if any, is based on the excess of the property’s actual NOI over a base NOI for the applicable 12‑month calculation period divided by the stated cap rate for such calculation period. Further, if the Company sells the Pineville Property or terminates the Beacon sub-management agreement without cause prior to March 31, 2021, the Company will be required to pay liquidated damages of at least $1.0 million unless the seller elects to receive the additional consideration described above. As of March 31, 2020, no amounts were paid to the seller of the Pineville Property, and no election to receive the additional consideration had been made. The aggregate purchase price for the hotel properties acquired during the three months ended March 31, 2020 and the year ended December 31, 2019 were allocated as follows: March 31, December 31, 2020 2019 Land and land improvements $ 2,576,166 $ 6,201,529 Building and building improvements 31,605,174 47,412,115 Furniture, fixtures, and equipment 3,007,846 4,772,707 Total assets acquired 37,189,186 58,386,351 Premium on assumed debt (597,665) (416,126) Total liabilities assumed (597,665) (416,126) Total purchase price (1) 36,591,521 57,970,225 Assumed mortgage debt 9,400,772 17,283,415 Net purchase price $ 27,190,749 $ 40,686,810 (1) Total purchase price includes purchase price plus all transaction costs.

DEBT

DEBT	3 Months Ended
	Mar. 31, 2020
DEBT
DEBT	4. DEBT Lines of Credit On August 22, 2018, the Company entered into a $3.0 million revolving line of credit, collateralized by 300,000 partnership units of Lodging Fund REIT III OP, LP. The line of credit has a variable interest rate equal to the U.S. Prime Rate, plus 1.00%, with a minimum rate of 5.00%. As of March 31, 2020, and December 31, 2019, the interest rate was 5.00% and 5.75%, respectively. As of March 31, 2020, there was an outstanding balance of $2.0 million. There was no outstanding balance on the line of credit as of December 31, 2019. The line of credit requires monthly payments of interest only, with all principal due at maturity. In November 2019, the line of credit was amended to extend the maturity date from November 22, 2019 to November 22, 2020, and lower the minimum interest rate from 6.00% to 5.00% per annum. The amendment also revised the guarantee of the line of credit to include a partial guarantee by each of Corey Maple and Norman Leslie, as the members of the Advisor, each in the amount of $1.2 million. On February 10, 2020, the Company entered into a $5.0 million revolving line of credit loan agreement. The line of credit requires monthly payments of interest only, with all outstanding principal amounts being due and payable at maturity on February 10, 2021. The line of credit has a variable interest rate equal to the U.S. Prime Rate, plus 0.50%, resulting in an effective rate of 3.75% per annum as of March 31, 2020. The line of credit is secured by the Company’s Cedar Rapids Property and Eagan Property, which are also subject to term loans with the same lender, and 100,000 limited partnership units of the Operating Partnership. The line of credit includes cross-collateralization and cross-default provisions such that the existing mortgage loan agreements with respect to the Cedar Rapids Property and the Eagan Property, as well as future loan agreements that the Company may enter into with this lender, are cross-defaulted and cross-collateralized with each other. The line of credit, including all cross-collateralized debt, is guaranteed by Corey Maple, the Company’s Chief Executive Officer. As of March 31, 2020, the outstanding balance on the line of credit was $3.2 million. On November 15, 2018, the Company entered into a $25.0 million revolving line of credit to provide immediate funds to acquire hotel properties. The facility had a variable interest rate equal to 30‑day LIBOR, plus 3.25% and had an initial term of 12 months. Each advance made under the facility was secured by a hotel property, required monthly payments of interest for the first three months following the advance, and monthly payments of principal and interest thereafter. The Company drew $5.2 million on the line of credit in connection with the purchase of the Cedar Rapids Property, which was repaid in full in March 2019 when the Cedar Rapids property was refinanced. The line of credit was closed in September 2019. Mortgage Debt As of March 31, 2020, the Company had $64.5 million in outstanding mortgage debt secured by seven properties, with maturity dates ranging from June 2024 to April 2029, with fixed interest rates ranging from 3.70% to 5.33%, and a weighted-average interest rate of 4.54%. The loans generally require monthly payments of principal and interest on an amortized basis, with certain loans allowing for an interest-only period up to 12 months following origination, and generally require a balloon payment due at maturity. As of March 31, 2020 and December 31, 2019, certain mortgage debt was guaranteed by the members of the Advisor. The Company was in compliance with all debt covenants as of March 31, 2020 and December 31, 2019. The following table sets forth the hotel properties securing each loan, the interest rate, maturity date, and the outstanding balance as of March 31, 2020 and December 31, 2019 for each of the Company’s mortgage debt obligations, respectively. Interest Outstanding Outstanding Rate as of Balance as of Balance as of March 31, Maturity March 31, December 31, Hotel Property 2020 Date 2020 2019 Holiday Inn Express - Cedar Rapids (1)(2) 5.33% 09/01/2024 $ 5,665,211 $ 5,527,392 Hampton Inn & Suites - Pineville 5.13% 06/06/2024 9,109,397 9,154,289 Hampton Inn - Eagan (2) 4.60% 01/01/2025 9,317,590 9,369,276 Home2 Suites - Prattville (1)(2) 4.13% 08/01/2024 9,620,000 9,620,000 Home2 Suites - Lubbock 4.69% 10/06/2026 7,950,051 8,000,430 Fairfield - Lubbock 4.93% 04/06/2029 9,376,788 — Homewood Suites - Southaven (1)(2) 3.70% 03/03/2025 13,460,000 — Total Mortgage Debt 64,499,037 41,671,387 $3.0 million line of credit 5.00% (3) 2,000,000 — $5.0 million line of credit 3.75% (4) 3,200,000 — Total Lines of Credit 5,200,000 — Premium on assumed debt, net 953,944 389,285 Deferred financing costs, net (1,634,072) (1,080,040) Debt, net $ 69,018,909 $ 40,980,632 (1) Loan is interest-only for the first 12 months after origination, then monthly principal and interest payments, with a balloon payment at maturity. (2) See note 11. “Subsequent Events” for a description of certain amendments and forbearance agreements entered into in connection with these loans. (3) Variable interest rate equal to U.S. Prime Rate plus 1.00% with a minimum rate of 5.00%. (4) Variable interest rate equal to U.S. Prime Rate plus 0.50%. Future Minimum Payments As of March 31, 2020, the future minimum principal payments on the Company’s debt were as follows: 2020 (April 1, 2020 to December 31, 2020) $ 2,630,308 2021 4,557,344 2022 1,505,990 2023 1,576,254 2024 23,479,447 Thereafter 35,949,694 69,699,037 Premium on assumed debt, net 953,944 Deferred financing costs, net (1,634,072) $ 69,018,909

FAIR VALUE OF FINANCIAL INSTRUM

FAIR VALUE OF FINANCIAL INSTRUMENTS	3 Months Ended
	Mar. 31, 2020
FAIR VALUE OF FINANCIAL INSTRUMENTS
FAIR VALUE OF FINANCIAL INSTRUMENTS	5. FAIR VALUE OF FINANCIAL INSTRUMENTS The Company’s financial instruments as of March 31, 2020 and December 31, 2019 consisted of cash and cash equivalents, restricted cash, accounts receivable, accounts payable, lines of credit, and mortgage debt. With the exception of the Company’s mortgage debt, the carrying amounts of the financial instruments presented in the consolidated financial statements approximate their fair value as of March 31, 2020. The fair value of the Company’s mortgage debt was estimated by discounting each loan’s future cash flows over the remaining term of the mortgage using current borrowing rates for debt instruments with similar terms and maturities, which are Level 3 inputs in the fair value hierarchy. As of March 31, 2020, the estimated fair value of the Company’s mortgage debt was $65.7 million, compared to the gross carrying value $64.5 million. As of December 31, 2019, the estimated fair value of the Company’s mortgage debt was $42.7 million, compared to the gross carrying value $41.7 million.

INCOME TAXES

INCOME TAXES	3 Months Ended
	Mar. 31, 2020
INCOME TAXES
INCOME TAXES	6. INCOME TAXES The Company’s earnings (losses), other than those generated by the Company’s TRS, are not generally subject to federal corporate and state income taxes due to the Company’s REIT election. The Company did not pay any federal and state income taxes for the periods ended March 31, 2020 and 2019. The Company did not have any uncertain tax positions as of March 31, 2020 or December 31, 2019. The Company’s TRS generated a net operating loss (“NOL”) for the three months ended March 31, 2020 and the year ended December 31, 2019, which can be carried forward to offset future taxable income. As of March 31, 2020 and December 31, 2019, the Company had a recorded deferred tax asset of $813,724 and $205,808, respectively, primarily attributable to its NOLs generated in the current period and prior periods, net of temporary differences primarily related to depreciation. The Company’s NOLs will expire in 2038‑2039 for state tax purposes and will not expire for federal tax purposes. As of March 31, 2020, the tax years 2018 and 2019 remain subject to examination by the U.S. Internal Revenue Service (“IRS”) and various state tax jurisdictions. The Coronavirus Aid, Relief and Economic Security Act (“CARES Act”), passed in March 2020, allows for NOL’s arising in tax years beginning after December 31, 2017 and before January 1, 2021 to be carried back to each of the preceding 5-year periods. In addition, the CARES Act removed the 80% absorption limitation previously enacted under the Tax Cuts and Jobs Act of 2017. Generally unused NOL’s generated prior to 2018 will expire 20 years following the year in which the NOL was created.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Mar. 31, 2020
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS	7. RELATED PARTY TRANSACTIONS Legendary Capital REIT III, LLC —Substantially all of the Company’s business is managed by the Advisor and its affiliates, pursuant to the Advisory Agreement. The Company has no direct employees. The employees of Legendary Capital, LLC (the “Sponsor”), an affiliate of the Advisor, provide services to the Company related to the negotiations of property acquisitions and financing, asset management, accounting, investor relations, and all other administrative services. The Company reimburses the Advisor and its affiliates, at cost, for certain expenses incurred on behalf of the Company. The Advisory Agreement has a term of 10 years. The Advisor earns a one-time acquisition fee of up to 1.4% of the hotel purchase price including funds allocated for any PIP at the time of each hotel property acquisition, a financing fee of up to 1.4% of the hotel purchase price including funds allocated for any PIP at the time of closing the initial financing, and an annual asset management fee of up to 0.75% of the gross assets of the Company, which is payable on a monthly basis. The Advisor will also be paid a refinancing fee of up to 0.75% of the principal amount of any refinancing at the time of closing the refinancing, and a disposition fee equal to between 0.0% and 4.0% of the hotel sales price, payable at the closing of the disposition, and real estate commissions of up to 3.0% of the hotel purchase price in connection with the sale of a hotel property in which the Advisor or its affiliates provided substantial services, but in no event greater than one-half of the total commissions paid with respect to such property if a commission is paid to a third-party as well as the Advisor, and in no event will total commissions exceed 5.0% of the hotel sales price. Certain affiliates of the Advisor may receive an annual guarantee fee equal to 1.0% of the guaranty amount, paid on a monthly basis, for debt obligations of the hotel properties personally guaranteed by such affiliates. The Advisor may earn an annual subordinated performance fee equal to 20% of the distributions after the common stockholders and Operating Partnership limited partners (other than the Series B Limited Partnership Unit (“Series B LP Unit”) holders) have received a 6% cumulative, but not compounded, return per annum. Per the terms of the Operating Partnership’s operating agreement, the Advisor receives distributions from the Operating Partnership in connection with their ownership of non-voting Series B LP Units. The Advisor’s ownership of Series B LP Units is presented as non-controlling interest on the accompanying consolidated financial statements. In years other than the year of liquidation, after the Company’s common stockholders have received a 6% cumulative but not compounded return on their original capital contributions, the Advisor receives distributions equal to 5% of the total distributions made. In the year of liquidation, termination, merger or other cessation of the general partner, or the liquidation of the Operating Partnership, holders of the Series B LP Units shall be distributed an amount equal to 5% of the limited partners’ capital contributions after the common stockholders and the limited partners have received a return of their original capital contributions plus a 6% cumulative but not compounded return. In the year of liquidation, termination, merger or other cessation of the general partner, or the liquidation of the Operating Partnership holders of the Series B LP Units shall also be distributed an amount equal to 20% of the net proceeds from the sale of the properties, after the common stockholders and the limited partners have received a return of their original capital contributions plus a 6% cumulative but not compounded return from all distributions. The Advisor and its affiliates may be reimbursed by the Company for certain organization and offering expenses in connection with the Offering, including legal, printing, marketing and other Offering related costs and expenses. Following the termination of the Offering, the Advisor will reimburse the Company for any such amounts incurred by the Company in excess of 15% of the gross proceeds of the Offering. In addition, the Company may pay directly or reimburse the Advisor and its affiliates for certain costs incurred in connection with its provision of services to the Company, including certain acquisition costs, financing costs, and sales and marketing costs, as well as an allocable share of general and administrative overhead costs. All reimbursements are paid to the Advisor and its affiliates at cost. Fees and reimbursements incurred and payable to the Advisor and its affiliates, for the three months ended March 31, 2020 and 2019, and amounts outstanding and payable as of March 31, 2020 and December 31, 2019, were as follows: Incurred Payable as of For the Three Months Ended March 31, March 31, December 31, 2020 2019 2020 2019 Fees: Acquisition fees $ 501,949 $ 200,324 $ — $ 213,402 Financing fees 501,949 200,324 — 213,402 Asset management fees 197,165 25,784 74,464 81,389 Performance fees — — — 68,534 $ 1,201,063 $ 426,432 $ 74,464 $ 576,727 Reimbursements: Offering costs $ 583,926 $ 611,135 $ 21,179 $ 122,833 General and administrative 813,575 523,066 26,549 120,386 Sales and marketing 76,153 91,342 9,647 3,333 Acquisition costs 64,847 58,951 15,956 31,966 Other 282 — 7,477 — $ 1,538,783 $ 1,284,494 $ 80,808 $ 278,518 For the three months ended March 31, 2020 and 2019, the Operating Partnership recognized distributions payable to the Advisor in the amount of $60,308 and $14,004, respectively, in connection with the Advisor’s ownership of Series B LP Units. As of March 31, 2020 and December 31, 2019, the Company had distributions payable to the Advisor $123,925 and $63,617, respectively. For the three months ended March 31, 2020 and 2019, the Company paid distributions in the amount of $9,409 and $9,409, respectively, to Corey Maple and Norman Leslie in connection with their ownership of 53,763 shares each, of the Company’s common stock. The members of the Advisor personally guaranty certain loans of the Company and may receive a guarantee fee of up to 1.0% per annum of the guaranty amount. Mr. Maple, our Chief Executive Officer and Chairman of the Board, is a guarantor of the Company’s loans secured by the hotel properties located in Prattville, Alabama and Southaven, Mississippi, which had original loan amounts of $9.6 million and $13.5 million, respectively, and is a guarantor of the Company’s $5.0 million line of credit which is secured by the hotel properties located in Cedar Rapids, Iowa and Eagan, Minnesota, and 100,000 limited partnership units of Lodging Fund REIT III OP, LP. Mr. Leslie, our President, Chief Investment Officer and Director, is a guarantor of the Company’s loan secured by the Company’s hotel property in Pineville, North Carolina, which had an original loan amount of $9.3 million. Mr. Maple and Mr. Leslie are also guarantors of the Company’s $3.0 million line of credit, each in the amount of $1.2 million. For the three months ended March 31, 2020, the Company incurred $69,334 of loan guarantee fees, and as of March 31, 2020, there were $63,334 of loan guarantee fees outstanding and payable. No guarantee fees were assessed for three months ended March 31, 2019, and no guarantee fees were outstanding and payable at December 31, 2019. NHS, LLC dba National Hospitality Services —NHS is wholly-owned by Norman Leslie, a director and executive officer of the Company and a principal of the Advisor. NHS provides property management and hotel operations management services for the Company’s hotel properties, pursuant to individual management agreements. The agreements have an initial term expiring on December 31st of the fifth full calendar year following the effective date of the agreement, which automatically renews for a period of five years on each successive five-year period, unless terminated in accordance with its terms. NHS earns a monthly base management fee for property management services, including overseeing the day-to-day operations of the hotel properties equal to 4% of gross revenue. NHS may also earn an accounting fee of $14.00 per room for accounting services, payable monthly, and an administrative fee equal to 0.60% of gross revenues for administrative and other services. The Company reimburses NHS for certain costs of operating the properties incurred on behalf of the Company. All reimbursements are paid to NHS at cost. Fees and reimbursements incurred and payable to, NHS for the three months ended March 31, 2020 and 2019, and amounts outstanding and payable as of March 31, 2020 and December 31, 2019, were as follows: Incurred Payable as of For the Three Months Ended March 31, March 31, December 31, 2020 2019 2020 2019 Fees: Management fees $ 116,089 $ 24,207 $ 36,182 $ 30,024 Administrative fees 17,863 9,202 5,821 4,617 Accounting fees 20,820 5,040 7,968 4,303 $ 154,772 $ 38,449 $ 49,971 $ 38,944 Reimbursements $ 80,576 $ 16,790 $ 9,715 $ 8,572

FRANCHISE AGREEMENTS

FRANCHISE AGREEMENTS	3 Months Ended
	Mar. 31, 2020
FRANCHISE AGREEMENTS
FRANCHISE AGREEMENTS	8. FRANCHISE AGREEMENTS As of March 31, 2020, all of the Company’s hotel properties were operated under franchise agreements with initial terms of 10 to 18 years. Franchise agreements allow the hotel properties to operate under the respective brands. Pursuant to the franchise agreements, the Company pays a royalty fee of 5% to 6% of room revenue, plus additional fees for marketing, central reservation systems and other franchisor costs. Certain hotels are also charged a program fee of generally between 3% and 4% of room revenue. The Company paid an initial fee of $50,000 to $175,000 at the time of entering into each franchise agreement which is being amortized over the term of each agreement.

STOCKHOLDERS_ EQUITY

STOCKHOLDERS’ EQUITY	3 Months Ended
	Mar. 31, 2020
STOCKHOLDERS’ EQUITY
STOCKHOLDERS’ EQUITY	9. STOCKHOLDERS’ EQUITY The Company is authorized to issue 900,000,000 shares of common stock and 100,000,000 shares of preferred stock. Each share of common stock entitles the holder to one vote per share for on all matters upon which stockholders are entitled to vote and to receive distributions as authorized by the Company’s board of directors. The rights of the holders of shares of preferred stock may be defined at such time any series of preferred shares are issued. Initial Offering On June 1, 2018, the Company commenced a private offering of shares of common stock, $0.01 par value per share, at a price of $10.00 per share, with a maximum offering of $100,000,000, to accredited investors only pursuant to a confidential private placement memorandum exempt from registration under the Securities Act of 1933, as amended. Dividend Reinvestment Plan The Company has adopted a dividend reinvestment plan (“DRIP”), which permits stockholders to reinvest their distributions back into the Company, purchasing shares of common stock at 95% of the then-current share net asset value (“NAV”). Distributions Distributions are determined by the board of directors based on the Company’s financial condition and other relevant factors. Effective the first day of each fiscal quarter since inception, the board of directors declared a cash distribution at a daily rate of $0.00191781 per share of common stock to the stockholders of record on the last day of each calendar month within the respective quarter, up to, and including the period ended March 31, 2020. Share Repurchase Plan The board of directors has adopted a share repurchase plan that may enable its stockholders to have their shares repurchased in limited circumstances. In its sole discretion, the board of directors could choose to terminate or suspend the plan or to amend its provisions without stockholder approval. The repurchase plan may be reviewed and modified by the board of directors as it deems necessary in its sole discretion. The price at which the Company will repurchase shares is dependent on the amount of time the holder has owned the shares, and the then current value of the shares. There are several limitations on the Company’s ability to repurchase shares under the share repurchase plan, including, but not limited to, a limitation that during any calendar year, the maximum number of shares potentially eligible for repurchase can only be the number of shares that the Company could purchase with the amount of net proceeds from the sale of shares under the Company’s dividend reinvestment plan during the prior calendar year. The board of directors may, in its sole discretion, reject any request for repurchase and may, at any time and without stockholder approval, upon 10 business days’ written notice to the stockholders (i) amend, suspend or terminate its share repurchase plan and (ii) increase or decrease the funding available for the repurchase of shares pursuant to our share repurchase plan. At March 31, 2020 and December 31, 2019, the Company had $707,133 and $49,530, respectively, available for eligible repurchases.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2020
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES	10. COMMITMENTS AND CONTINGENCIES Impact of COVID-19 — As further discussed in Note 2, the full extent of the impact of COVID-19 on the U.S. and world economies generally, and the Company’s business in particular, is uncertain. As of March 31, 2020, no contingencies have been recorded on the Company’s consolidated balance sheet as a result of COVID-19, however as the global pandemic continues and the economic implications worsen, it may have long-term impacts on the Company’s financial condition, results of operations, and cash flows. Refer to Note 2 for further discussion of COVID-19. Legal Matters —From time to time, the Company may become party to legal proceedings that arise in the ordinary course of its business. Management is not aware of any legal proceedings of which the outcome is probable or reasonably possible to have a material adverse effect on the Company’s results of operations, cash flows or financial condition, which would require accrual or disclosure of the contingency and possible range of loss.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2020
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	11. SUBSEQUENT EVENTS COVID-19 Pandemic The Company is closely monitoring the impact of the COVID-19 pandemic on all aspects of its business. As described below, the Company obtained loans under the Paycheck Protection Program and entered into the forbearance agreements and amendments to loan agreements in April 2020, which measures were intended to help maintain financial flexibility given the significant impact on U.S. and world economies as a result of the COVID-19 pandemic. As a result of the COVID-19 pandemic and measures taken to limit the pandemic and its impact, the Company experienced decreases in hotel occupancy and revenues during the month of April 2020. The extent to which the COVID-19 pandemic continues to impact the Company’s operations 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. Paycheck Protection Program (the “PPP”) Loans In April 2020, the Company entered into six unsecured promissory notes under the Paycheck Protection Program (the “PPP”), totaling $763,100. The PPP was established under the recently congressionally approved Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) and is administered by the U.S. Small Business Administration (the “SBA”). The term of each PPP loan is two years. The interest rate on each PPP loan is 1.0% per annum, which shall be deferred for the first six months of the term of the loan. After the initial six-month deferral period, each loan requires monthly payments of principal and interest until maturity with respect to any portion of such PPP loan which is not forgiven as described below. The Company is permitted to prepay each PPP loan at any time with no prepayment penalties. Under the terms of the CARES Act, PPP loan recipients can apply for, and be granted, forgiveness for all or a portion of loans granted under the PPP. Such forgiveness will be determined, subject to limitations and ongoing rulemaking by the SBA, based on the use of loan proceeds for payroll costs and mortgage interest, rent or utility costs and the maintenance of employee and compensation levels. No assurance is provided that the Company will obtain forgiveness of the PPP loans in whole or in part. Forbearance Agreements and Loan Amendments On April 17, 2020, the Company entered into a Change In Terms Agreement (the “Cedar Rapids Amendment”), amending the terms of the its original Promissory Note (the “Cedar Rapids Note”), dated March 5, 2019 in the original principal amount of $5.86 million. Pursuant to the Cedar Rapids Amendment, the maturity date of the Cedar Rapids Note was extended from March 1, 2024, to September 1, 2024, the requirement to make any replacement reserve deposits was waived until March 1, 2021, and the requirement to make any payments of principal and interest were deferred until October 1, 2020. On April 17, 2020, the Company entered into a Change In Terms Agreement (the “Eagan Amendment”), amending the terms of the its original Promissory Note (the “Eagan Note”), dated June 19, 2019 in the original principal amount of $9.44 million. Pursuant to the Eagan Amendment, the maturity date of the Eagan Note was extended from July 1, 2024, to January 1, 2025, the requirement to make any replacement reserve deposits was waived until June 1, 2021, and the requirement to make any payments of principal and interest were deferred until October 1, 2020. On April 22, 2020, the Company entered into a Forbearance Agreement (the “Prattville Forbearance Agreement”), to be effective May 1, 2020, amending the terms of its original loan agreement (the “Prattville Loan”), dated July 11, 2019, in the original principal amount of $9.6 million. Pursuant to the Prattville Forbearance Agreement, the Company will not make interest payments that will become due and payable during the Prattville Forbearance Period (as defined below) which constitute Events of Default under the terms of the Prattville Loan (collectively, the “Prattville Projected Events of Default”). However, during the Prattville Forbearance Period , the lender agreed to forbear from exercising any available rights and remedies under the Prattville Loan and other Loan Documents (as defined in the Prattville Loan) to the extent such rights and remedies arise as a result of the Prattville Projected Events of Default. The forbearance period (the “Prattville Forbearance Period”) shall be the period beginning May 1, 2020 through and including July 31, 2020, subject to earlier termination pursuant to the terms of the Prattville Forbearance Agreement. On April 22, 2020, the Company entered into a Forbearance Agreement (the “Southaven Forbearance Agreement”), to be effective May 1, 2020, amending the terms of its original loan agreement (the “Southaven Loan”), dated February 21, 2020, in the original principal amount of $13.5 million. Pursuant to the Southaven Forbearance Agreement, the Company will not make interest payments that will become due and payable during the Southaven Forbearance Period (as defined below) which constitute Events of Default under the terms of the Southaven Loan (collectively, the “Southaven Projected Events of Default”). However, during the Southaven Forbearance Period , the lender agreed to forbear from exercising any available rights and remedies under the Southaven Loan and other Loan Documents (as defined in the Southaven Loan) to the extent such rights and remedies arise as a result of the Southaven Projected Events of Default. The forbearance period (the “Southaven Forbearance Period”) shall be the period beginning May 1, 2020 through and including July 31, 2020, subject to earlier termination pursuant to the terms of the Southaven Forbearance Agreement. Interval Common Stock Articles Supplementary On April 29, 2020, the Company filed with the Maryland State Department of Assessments and Taxation articles supplementary (the “Articles Supplementary”) to the Company’s charter, to classify and designate 7,000,000 shares of authorized but unissued common stock, $0.01 par value per share, of the Company, as non-voting shares of Interval Common Stock (“Interval Common Stock”) and to set the terms of the Interval Common Stock. H olders of shares of Interval Common Stock will be entitled to receive, when and as authorized by the board of directors of the Company and declared by the Company, dividends at a rate equal to 86% of the dividend rate for the Company’s common stock as authorized by the board of directors and declared by the Company. Dividends on the Interval Shares may be paid in cash, capital stock of the Company or a combination of cash and capital stock of the Company as determined by the board of directors, and will be paid at such times as dividends are paid to the holders of common stock. Repurchase Plan The board of directors has adopted a repurchase plan for the Interval Common Stock (the “Repurchase Plan”). The Repurchase Plan is generally available to holders of Interval Common Stock who have held their shares of Interval Common Stock (“Interval Shares”) for at least 1 year. The Repurchase Plan provides that so long as the Repurchase Reserve (defined below) exists, the Company will repurchase up to the lesser of (i) 5% of the aggregate value of the Interval Shares (“Interval Shares Value”) on the last day of the same calendar quarter of the preceding year and (ii) 5% of the Interval Shares Value on the last day of the preceding calendar quarter. After the Repurchase Reserve has been exhausted, the Company will limit repurchases of Interval Shares to repurchases that can be made with the net proceeds from the dividend reinvestment plan for the Interval Shares received in the prior calendar year up to the lesser of (i) 1.25% per calendar quarter and (ii) 5% per calendar year of the Interval Shares Value. The limitations described in this paragraph are referred to as the “Repurchase Limitations.” The Company will establish a reserve (the “Repurchase Reserve”) of liquid assets in an amount equal to 20% of the aggregate gross proceeds from the Company’s private offering of Interval Shares, which will be comprised of cash and cash-like instruments, government securities, publicly traded REIT shares and other publicly traded securities (the “Reserve Assets”), but which is expected to primarily include publicly traded REIT shares. The Repurchase Reserve will be used solely to repurchase the Interval Shares. The board of directors may, but has no obligation to, increase the amount of the Repurchase Reserve at any time. The Company will have no obligation to restore any amounts resulting from a decline in value of the Reserve Assets. After the Repurchase Reserve has been exhausted, subject to the Repurchase Limitations, the Company will use only the net proceeds from the dividend reinvestment plan received in the prior calendar year to repurchase the Interval Shares. Subject to the Repurchase Limitations, on the applicable repurchase date, the Company will repurchase the Interval Shares timely submitted for repurchase for a price equal to the NAV per share of the Company’s common stock on such repurchase date as determined by the board of directors. The board of directors may, upon 10 days’ written notice to the holders of Interval Shares, amend, suspend or terminate the Repurchase Plan at any time, and such amendment, suspension or termination may be implemented immediately. Notwithstanding the foregoing, the Repurchase Plan may not be terminated prior to the date the Repurchase Reserve is exhausted. Private Offering The Company is offering up to 3,000,000 shares of Interval Common Stock in the Company’s ongoing private offering, which amount may be increased to up to 6,000,000 Interval Shares in the sole discretion of the board of directors. Except as otherwise provided in the offering memorandum, the initial purchase price for the Interval Shares is $10.00 per Interval Share, with Interval Shares purchased in the Company’s dividend reinvestment plan at an initial price of $9.50 per Interval Share. Status of the Offering As of May 14, 2020, the Company’s private offering remained open for new investment, and since the inception of the offering the Company had issued and sold 7,136,866 shares of common stock, including 133,331 shares issued pursuant to the DRIP, resulting in the receipt of gross offering proceeds of $70.1 million. ******

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2020
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Basis of Presentation and Principles of Consolidation	Basis of Presentation and Principles of Consolidation —The accompanying unaudited consolidated financial statements and related notes have been prepared on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America (“GAAP”) and the rules and regulations of the SEC applicable to interim financial information. Accordingly, the unaudited financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. The financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, and which, in the opinion of management, are necessary for a fair and consistent presentation of the results for such periods. Operating results for the three months ended March 31, 2020 are not necessarily indicative of the results that may be expected for the year ending December 31, 2020. The consolidated financial statements include the accounts of LF REIT III, the OP and its wholly-owned subsidiaries. For the controlled subsidiaries that are not wholly-owned, the interests owned by an entity other than the Company represent a noncontrolling interest, which is presented separately in the consolidated financial statements. The Company has no foreign operations or assets and its operating structure includes only one reportable Segment. All intercompany balances and transactions have been eliminated in consolidation.
Use of Estimates	Use of Estimates —The preparation of the Company’s consolidated financial statements and the accompanying notes in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of certain assets and liabilities and the amounts of contingent assets and liabilities at the balance sheet date and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. During the first quarter of 2020, there was a global outbreak of a novel coronavirus, or COVID-19, which has spread to over 200 countries and territories, including the United States, and has spread to every state in the United States. The World Health Organization has designated COVID-19 as a pandemic, and numerous countries, including the United States, have declared national emergencies with respect to COVID-19. The impact of the outbreak on the U.S. and world economies has been rapidly evolving, and as cases of COVID-19 have continued to be identified in additional countries, there have been international mandates, and mandates in the United States from federal, state and local authorities, instituting quarantines and stay-at-home orders, closing schools, and instituting restrictions on travel and/or limiting operations of non-essential offices and retail centers. Such actions are adversely impacting many industries, with the travel and hospitality industries being particularly adversely affected. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19 on economic and market conditions. The Company believes the estimates and assumptions underlying the Company’s consolidated financial statements are reasonable and supportable based on the information available as of March 31, 2020, however uncertainty over the ultimate impact COVID-19 will have on the global economy generally, and the Company’s business in particular, makes any estimates and assumptions as of March 31, 2020 inherently less certain than they would be absent the current and potential impacts of COVID-19.
Revenue Recognition	Revenue Recognition —Revenues consist of amounts derived from hotel operations, including room sales and other hotel revenues, and are presented on a disaggregated basis in the Company’s consolidated statements of operations. These revenues are recorded net of any sales and occupancy taxes collected from the hotel guests. All revenues are recorded on an accrual basis as they are earned. Any cash received prior to a guest’s arrival is recorded as an advance deposit from the guest and recognized as revenue at the time of the guest’s occupancy at the hotel property.
Investment in Hotel Properties	Investment in Hotel Properties —The Company evaluates whether each hotel property acquisition should be accounted for as an asset acquisition or a business combination. If substantially all of the fair value of the gross assets acquired is concentrated in a single asset or a group of similar identifiable assets, then the transaction is considered to be an asset acquisition. All of the Company’s acquisitions since inception have been determined to be asset acquisitions. Transaction costs associated with asset acquisitions are capitalized and transaction costs associated with business combinations would be expensed as incurred. The Company’s acquisitions generally consist of land, land improvements, buildings, building improvements, and furniture, fixtures and equipment (“FF&E”). The Company may also acquire intangible assets or liabilities related to in-place leases, management agreements, debt, and advanced bookings. For transactions determined to be asset acquisitions, the Company allocates the purchase price among the assets acquired and the liabilities assumed on a relative fair value basis at the date of acquisition. The Company determines the fair value of assets acquired and liabilities assumed with the assistance of third-party valuation specialists, using cash flow analysis as well as available market and cost data. The determination of fair value includes making numerous estimates and assumptions. The difference between the fair value and the face value of debt assumed in connection with an acquisition is recorded as a premium or discount and amortized to interest expense over the remaining term of the debt assumed. The valuation of assumed debt liabilities is based on our estimate of the current market rates for similar liabilities in effect at the acquisition date. The Company’s investments in hotel properties are carried at cost and are depreciated using the straight-line method over the estimated useful lives of 15 years for land improvements, 15 years for building improvements, 40 years for buildings and three to seven years for FF&E. Maintenance and repair costs are expensed in the period incurred and major renewals or improvements to the hotel properties are capitalized. Interest incurred in connection with the financing of real estate under development or renovation is capitalized as an additional cost of development. The Company discontinues the capitalization of interest once the real estate development or renovation project is substantially complete. The Company assesses the carrying value of its hotel properties whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. The recoverability is measured by comparing the carrying amount of the property to the estimated future undiscounted cash flows of the property, which take into account current market conditions and the Company’s intent with respect to holding or disposing of the hotel properties. If the Company’s analysis indicates that the carrying value is not recoverable on an undiscounted cash flow basis, the Company will recognize an impairment loss for the amount by which the carrying value exceeds the fair value. The fair value is determined through various valuation techniques, including internally developed discounted cash flow models, comparable market transactions or third-party appraisals. The use of projected future cash flows is based on assumptions that are consistent with a market participant’s future expectations for the industry and the economy in general and the Company’s expected use of the underlying hotel properties. The assumptions and estimates related to the future cash flows and the capitalization rates are complex and subjective in nature. Changes in economic and operating conditions, including those occurring as a result of the impact of the COVID-19 pandemic, that occur subsequent to a current impairment analysis and the Company’s ultimate use of the hotel property could impact the assumptions and result in future impairment losses to the hotel properties.
Non-controlling Interests	Non-controlling Interest —Non-controlling interests represent the portion of equity in a subsidiary held by owners other than the Company. Non-controlling interests are reported in the consolidated balance sheets within equity, separate from stockholders’ equity. Revenue and expenses attributable to both the Company and the non-controlling interests are reported in the consolidated statements of operations, with net income or loss attributable to non-controlling interests reported separately from net income or loss attributable to the Company.
Cash and Cash Equivalents	Cash and Cash Equivalents —Cash and cash equivalents include cash in bank accounts as well as highly liquid investments with an original maturity of three months or less. The Company deposits cash with several high-quality financial institutions. These deposits are guaranteed by the Federal Deposit Insurance Corporation (“FDIC”) up to an insurance limit of $250,000. At times, the Company’s cash and cash equivalents may exceed federally insured levels.
Restricted Cash	Restricted Cash —Restricted cash consists of earnest money deposits related to hotel property acquisitions, as well as certain funds maintained in escrow accounts to fund future payments for insurance, property tax obligations, and reserves for future capital expenditures, as required by our debt agreements. As of March 31, 2020 and December 31, 2019, restricted cash on the accompanying consolidated balance sheets included $1.7 million and $2.6 million, respective, of earnest money deposits.
Accounts Receivable	Accounts Receivable —Accounts receivable consist primarily of receivables due from hotel guests for room stays and meeting and banquet room rentals, which are uncollateralized customer obligations. Management determines the likelihood of collectability of receivables on an individual customer basis, based on the amount of time the balance has been outstanding, likelihood of collecting, and the customer’s current economic status. The carrying amount of the accounts receivables is reduced by a valuation allowance that reflects management’s best estimate of the amounts that will not be collected.
Deferred Financing Costs	Deferred Financing Costs —Deferred financing costs represent commitment fees, origination fees, legal fees, and other costs associated with obtaining financing. Deferred financing costs are presented on the consolidated balance sheets as a direct deduction from the carrying amount of the related debt liability. These costs are amortized to interest expense over the terms of the respective financing agreements using the straight-line method, which approximates the effective interest method. The Company expenses unamortized deferred financing costs when the associated financing agreement is refinanced or repaid before maturity unless certain criteria are met that would allow for the carryover of such costs to the refinanced agreement. Costs incurred in connection with potential financial transactions that are not completed are expensed in the period in which it is determined the financing will not be completed.
Offering Costs	Offering Costs —The Company has incurred certain costs related directly to the Company’s private offering consisting of, among other costs, commissions, legal, due diligence costs, printing, marketing, filing fees, postage, data processing fees, and other offering related costs. These costs are capitalized and recorded as a reduction of equity proceeds on the accompanying consolidated balance sheets.
Property Operations Expenses	Property Operations Expenses —Property operations expenses consist of expenses related to room rental, food and beverage sales, telephone usage, and other miscellaneous service costs, as well as all costs of operating the Company’s hotel properties such as building repairs, maintenance, property taxes, utilities, and other related costs.
Property Management Fees	Property Management Fees —Property management fees include expenses incurred for management services provided for the day-to-day operations of our hotel properties, which are generally charged at a rate of 4% of gross revenues. Property management fees also include asset management fees, which may be charged at an annual rate of up to 0.75% of gross assets and are paid to the Advisor. For the three months ended March 31, 2020 and 2019, asset management fees were charged only on the value of investments in hotel properties.
Franchise Fees	Franchise Fees —The Company pays initial fees related to hotel franchise rights prior to acquiring a hotel property. The fees are included in prepaid expenses and other assets until the time the related hotel property is acquired. Initial franchise fees related to hotel properties that are acquired are amortized on a straight-line basis over the life of the agreement. Initial franchise fees related to hotel properties that are not acquired are refunded to the Company, net of any associated fees, and any fees are expensed as incurred. Franchise fees on the accompanying consolidated statements of operations include the amortization of initial franchise fees, as well as monthly fees paid to franchisors for royalty, marketing, and reservation fees and other related costs.
Acquisition Costs	Acquisition Costs —The Company incurs costs during the review of potential hotel property acquisitions including legal fees, environmental reviews, market studies, financial advisory services, and other professional service fees. If the Company does complete a property acquisition, an acquisition fee of up to 1.4% is charged by the Advisor, based on the purchase price of the property plus any estimated property improvement plan (“PIP”) costs. For transactions determined to be asset acquisitions, these costs are capitalized as part of the overall cost of the project if the property is ultimately acquired. For transactions determined to be business combinations, these costs would be expensed in the period incurred. Acquisition-related and acquisition due diligence costs that relate to a property that is not acquired, are expensed and included in acquisition costs on the accompanying consolidated statements of operations. Prior to the ultimate determination of whether a property will be acquired or not, acquisition-related and acquisition due diligence costs are recorded as, and included in, prepaid expenses and other assets on the accompanying consolidated balance sheets.
Net Loss Per Share of Common Stock	Net Loss Per Share of Common Stock —Basic net loss per common share is computed based upon the weighted average number of shares outstanding during the period. Diluted net loss per common share is calculated after giving effect to all potential common shares that were dilutive and outstanding for the period. Basic and diluted net loss per common share were the same for the periods presented.
Income Taxes	Income Taxes —The Company has elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended. To qualify as a REIT, the Company must meet a number of organizational and operational requirements, including a requirement that it distribute at least 90% of its REIT taxable income, subject to certain adjustments and excluding any net capital gain, to stockholders. The Company’s intention is to adhere to the REIT qualification requirements and to maintain its qualification for taxation as a REIT. As a REIT, the Company is generally not subject to U.S. federal corporate income tax on the portion of taxable income that is distributed to stockholders. If the Company fails to qualify for taxation as a REIT in any taxable year, the Company will be subject to U.S. federal income taxes at regular corporate rates and it may not be able to qualify as a REIT for four subsequent taxable years. As a REIT, the Company may be subject to certain state and local taxes on its income and property, and to U.S. federal income and excise taxes on undistributed taxable income. Taxable income from non-REIT activities managed through the Company’s taxable REIT subsidiary (“TRS”) is subject to U.S. federal, state, and local income taxes at the applicable rates. The TRS accounts for income taxes using the asset and liability method. Under this method, deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to the differences between the financial statement carrying amounts of existing assets and liabilities and their respective income tax basis, and for net operating loss, capital loss and tax credit carryforwards. The deferred tax assets and liabilities are measured using the enacted income tax rates in effect for the year in which those temporary differences are expected to be realized or settled. The effect on the deferred tax assets and liabilities from a change in tax rates is recognized in earnings in the period when the new rate is enacted. However, deferred tax assets are recognized only to the extent that it is more likely than not that they will be realized based on consideration of all available evidence, including the future reversals of existing taxable temporary differences, future projected taxable income and tax planning strategies. Valuation allowances are provided if, based upon the weight of the available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. The Company performs periodic reviews for any uncertain tax positions and, if necessary, will record the expected future tax consequences of uncertain tax positions in the consolidated financial statements.
Fair Value Measurement	Fair Value Measurement —The Company establishes fair value measures based on the fair value definition and hierarchy levels established by GAAP. These fair values are based on a three-tiered fair value hierarchy, which prioritizes the inputs used in measuring fair value as follows: Level 1 —Observable inputs such as quoted prices in active markets. Level 2 —Directly or indirectly observable inputs, other than quoted prices in active markets. Level 3 —Unobservable inputs in which there is little or no market data, which require a reporting entity to develop its own assumptions. The Company’s estimates of fair value were determined using available market information and appropriate valuation methods. Considerable judgment is necessary to develop estimated fair value. The use of different market assumptions or estimation methods may have a material effect on the estimated fair value amounts. The Company classifies assets and liabilities in the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement.
Recent Accounting Pronouncements	Recent Accounting Pronouncements —The Company, as an emerging growth company, has elected to use the extended transition period which allows us to defer the adoption of new or revised accounting standards. This allows the Company to adopt new or revised accounting standards as of the effective date for non-public business entities. In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014‑09, Revenue from Contracts with Customers (Topic 606). The core principle of the new standard is that revenue should be recognized to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. ASU 2014‑09 is effective for fiscal years beginning after December 15, 2018, and interim reporting periods within annual reporting periods beginning after December 15, 2019. The Company adopted ASU 2014‑09 as of January 1, 2019 and has applied it on a modified retrospective basis. Based on the Company’s completed assessment of this updated accounting guidance, it does not materially affect the amount or timing of revenue recognition for the Company and the Company did not recognize any cumulative-effect adjustment as a result of adoption. In February 2016, the FASB issued ASU No. 2016‑02, “Leases” (“ASU No. 2016‑02”) (Topic 842), which sets out the principles for the recognition, measurement, presentation and disclosure of leases for both parties to a contract (i.e., lessees and lessors). ASU No. 2016‑02 requires lessees to apply a dual approach, classifying leases as either finance or operating leases based on the principle of whether or not the lease is effectively a financed purchase of the leased asset by the lessee. This classification will determine whether the lease expense is recognized based on an effective interest method or on a straight-line basis over the term of the lease. A lessee is also required to record a right of use asset and a lease liability for all leases with a term of greater than 12 months regardless of their classification. Leases with a term of 12 months or less will be accounted for similar to existing guidance for operating leases. The new standard requires lessors to account for leases using an approach that is substantially equivalent to existing guidance for sales type leases, direct financing leases and operating leases. ASU No. 2016‑02 is effective for fiscal years beginning after December 15, 2020, and interim periods within fiscal years beginning after December 15, 2021. We plan to adopt ASU 2016‑02 for the year ending December 31, 2021. We do not anticipate any reclassifications or significant impacts on our consolidated financial statements as a result of this adoption.

INVESTMENT IN HOTEL PROPERTIES

INVESTMENT IN HOTEL PROPERTIES (Tables)	3 Months Ended
	Mar. 31, 2020
INVESTMENT IN HOTEL PROPERTIES
Schedule of investment in hotel properties	March 31, December 31, 2020 2019 Land and land improvements $ 10,314,661 $ 7,738,495 Building and building improvements 84,575,847 53,238,276 Furniture, fixtures, and equipment 8,708,360 5,687,249 Construction in progress 451,091 — Investment in hotel properties, at cost 104,049,959 66,664,020 Less: accumulated depreciation (2,074,113) (1,255,712) Investment in hotel properties, net $ 101,975,846 $ 65,408,308
Schedule of acquisitions of hotel properties	The table below outlines the details of the properties acquired during the three months ended March 31, 2020. 2020 Acquisitions Number Date of Guest Purchase Transaction % Hotel Property Type Location Acquired Rooms Price Costs Total Interest Fairfield Inn & Suites Limited Service Lubbock, TX January 8, 2020 101 $ 15,150,000 $ 496,431 $ 15,646,431 100 % Homewood Suites Extended Stay Southaven, MS February 21, 2020 99 20,500,000 445,090 20,945,090 100 % 200 $ 35,650,000 $ 941,521 $ 36,591,521 The table below outlines the details of the properties acquired during the year ended December 31, 2019. 2019 Acquisitions Number Date of Guest Purchase Transaction % Hotel Property Type Location Acquired Rooms Price Costs Total Interest Hampton Inn & Suites Limited Service Pineville, NC March 19, 2019 111 $ 13,897,358 $ 303,744 $ 14,201,102 100 % Hampton Inn Limited Service Eagan, MN June 19, 2019 122 13,950,000 278,333 14,228,333 100 % Home2 Suites Extended Stay Prattville, AL July 11, 2019 90 14,750,000 356,014 15,106,014 100 % Home2 Suites Extended Stay Lubbock, TX December 30, 2019 100 14,150,000 284,776 14,434,776 100 % 423 $ 56,747,358 $ 1,222,867 $ 57,970,225

DEBT - (Tables)

DEBT - (Tables)	3 Months Ended
	Mar. 31, 2020
DEBT
Schedule of debt outstanding	Interest Outstanding Outstanding Rate as of Balance as of Balance as of March 31, Maturity March 31, December 31, Hotel Property 2020 Date 2020 2019 Holiday Inn Express - Cedar Rapids (1)(2) 5.33% 09/01/2024 $ 5,665,211 $ 5,527,392 Hampton Inn & Suites - Pineville 5.13% 06/06/2024 9,109,397 9,154,289 Hampton Inn - Eagan (2) 4.60% 01/01/2025 9,317,590 9,369,276 Home2 Suites - Prattville (1)(2) 4.13% 08/01/2024 9,620,000 9,620,000 Home2 Suites - Lubbock 4.69% 10/06/2026 7,950,051 8,000,430 Fairfield - Lubbock 4.93% 04/06/2029 9,376,788 — Homewood Suites - Southaven (1)(2) 3.70% 03/03/2025 13,460,000 — Total Mortgage Debt 64,499,037 41,671,387 $3.0 million line of credit 5.00% (3) 2,000,000 — $5.0 million line of credit 3.75% (4) 3,200,000 — Total Lines of Credit 5,200,000 — Premium on assumed debt, net 953,944 389,285 Deferred financing costs, net (1,634,072) (1,080,040) Debt, net $ 69,018,909 $ 40,980,632 (1) Loan is interest-only for the first 12 months after origination, then monthly principal and interest payments, with a balloon payment at maturity. (2) See note 11. “Subsequent Events” for a description of certain amendments and forbearance agreements entered into in connection with these loans. (3) Variable interest rate equal to U.S. Prime Rate plus 1.00% with a minimum rate of 5.00%. (4) Variable interest rate equal to U.S. Prime Rate plus 0.50%.
Schedule of future minimum principal payments	2020 (April 1, 2020 to December 31, 2020) $ 2,630,308 2021 4,557,344 2022 1,505,990 2023 1,576,254 2024 23,479,447 Thereafter 35,949,694 69,699,037 Premium on assumed debt, net 953,944 Deferred financing costs, net (1,634,072) $ 69,018,909

RELATED PARTY TRANSACTIONS (Tab

RELATED PARTY TRANSACTIONS (Tables)	3 Months Ended
	Mar. 31, 2020
Legendary Capital REIT III, LLC
Related Party Transactions
Schedule of fees and reimbursements incurred and payable	Incurred Payable as of For the Three Months Ended March 31, March 31, December 31, 2020 2019 2020 2019 Fees: Acquisition fees $ 501,949 $ 200,324 $ — $ 213,402 Financing fees 501,949 200,324 — 213,402 Asset management fees 197,165 25,784 74,464 81,389 Performance fees — — — 68,534 $ 1,201,063 $ 426,432 $ 74,464 $ 576,727 Reimbursements: Offering costs $ 583,926 $ 611,135 $ 21,179 $ 122,833 General and administrative 813,575 523,066 26,549 120,386 Sales and marketing 76,153 91,342 9,647 3,333 Acquisition costs 64,847 58,951 15,956 31,966 Other 282 — 7,477 — $ 1,538,783 $ 1,284,494 $ 80,808 $ 278,518
NHS
Related Party Transactions
Schedule of fees and reimbursements incurred and payable	Incurred Payable as of For the Three Months Ended March 31, March 31, December 31, 2020 2019 2020 2019 Fees: Management fees $ 116,089 $ 24,207 $ 36,182 $ 30,024 Administrative fees 17,863 9,202 5,821 4,617 Accounting fees 20,820 5,040 7,968 4,303 $ 154,772 $ 38,449 $ 49,971 $ 38,944 Reimbursements $ 80,576 $ 16,790 $ 9,715 $ 8,572

ORGANIZATION - (Details)

ORGANIZATION - (Details)	3 Months Ended
	Mar. 31, 2020USD ($)segmentVote$ / sharesshares	Dec. 31, 2019Vote$ / sharesshares	Jun. 01, 2018USD ($)$ / shares
Organization
Number of reportable segments | segment	1
Number of voting classes of partnership units | Vote	2	2
Number of non voting classes of partnership units | Vote	1	1
Common stock, par value (in dollars per share) | $ / shares	$ 0.01	$ 0.01
Cumulative number of shares issued	6,996,670
Cumulative number of shares issued pursuant to the DRIP	133,331
Cumulative gross proceeds from issuance of stock | $	$ 68,700,000
Private offering
Organization
Common stock, par value (in dollars per share) | $ / shares			$ 0.01
Maximum offering | $			$ 100,000,000
Operating Partnership | Common Partnership Units
Organization
Number of outstanding partnership units	0	0
Operating Partnership | Series B Limited Partnership Units
Organization
Number of outstanding partnership units	1,000	1,000

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Millions	3 Months Ended
	Mar. 31, 2020USD ($)segment	Dec. 31, 2019USD ($)
Basis of Presentation and Principles of Consolidation
Number of Reportable Segments | segment	1
Property Management Fees
Property management fees (as a percent)	4.00%
Asset management fees (as a percent)	0.75%
Acquisition Costs
Acquisition fee (as a percent)	1.40%
Income Taxes
Non eligibility term for REIT non compliance	4 years
Restricted Cash
Restricted Cash
Amount deposited in escrow as earnest money | $	$ 1.7	$ 2.6
Land improvements
Investment in Hotel Properties
Estimated useful lives	15 years
Building improvements
Investment in Hotel Properties
Estimated useful lives	15 years
Buildings
Investment in Hotel Properties
Estimated useful lives	40 years
Furniture, fixtures, and equipment | Minimum
Investment in Hotel Properties
Estimated useful lives	3 years
Furniture, fixtures, and equipment | Maximum
Investment in Hotel Properties
Estimated useful lives	7 years

INVESTMENT IN HOTEL PROPERTIE_2

INVESTMENT IN HOTEL PROPERTIES - Summary (Details)	Mar. 31, 2020USD ($)statepropertyroom	Dec. 31, 2019USD ($)
Investment in hotel properties consisted of the following:
Land and land improvements	$ 10,314,661	$ 7,738,495
Building and building improvements	84,575,847	53,238,276
Furniture, fixtures, and equipment	8,708,360	5,687,249
Construction in progress	451,091
Investment in hotel properties, at cost	104,049,959	66,664,020
Less: accumulated depreciation	(2,074,113)	(1,255,712)
Investment in hotel properties, net	$ 101,975,846	$ 65,408,308
Other disclosures
Number of hotel properties owned | property	7
Aggregate number of rooms in hotel properties | room	706
Number of states where hotel properties are owned | state	6

INVESTMENT IN HOTEL PROPERTIE_3

INVESTMENT IN HOTEL PROPERTIES - Acquisitions (Details)	Feb. 21, 2020USD ($)room	Jan. 08, 2020USD ($)room	Dec. 30, 2019USD ($)room	Jul. 11, 2019USD ($)room	Jun. 19, 2019USD ($)room	Mar. 19, 2019USD ($)room	Mar. 31, 2020USD ($)propertyroom	Dec. 31, 2019USD ($)propertyroom
Acquisitions
Number of Rooms | room							200	423
Purchase Price							$ 35,650,000	$ 56,747,358
Transaction Costs							941,521	1,222,867
Total							$ 36,591,521	$ 57,970,225
Other disclosures
Management agreement, automatic renewal term							5 years
Fairfield Inn & Suites (the "Lubbock Property")
Acquisitions
Number of Rooms | room		101
Purchase Price		$ 15,150,000
Transaction Costs		496,431
Total		$ 15,646,431
Interest (as a percent)		100.00%
Homewood Suites (the "Southaven Property")
Acquisitions
Number of Rooms | room	99
Purchase Price	$ 20,500,000
Transaction Costs	445,090
Total	$ 20,945,090
Interest (as a percent)	100.00%
Hampton Inn & Suites(the "Pineville Property")
Acquisitions
Number of Rooms | room						111
Purchase Price						$ 13,897,358
Transaction Costs						303,744
Total						$ 14,201,102
Interest (as a percent)						100.00%
Other disclosures
Liquidated damage payable						$ 1,000,000
Hampton Inn (the "Eagan Property")
Acquisitions
Number of Rooms | room					122
Purchase Price					$ 13,950,000
Transaction Costs					278,333
Total					$ 14,228,333
Interest (as a percent)					100.00%
Home2 Suites (the "Prattville Property")
Acquisitions
Number of Rooms | room				90
Purchase Price				$ 14,750,000
Transaction Costs				356,014
Total				$ 15,106,014
Interest (as a percent)				100.00%
Home2 Suites (the “Lubbock Home2 Property”)
Acquisitions
Number of Rooms | room			100
Purchase Price			$ 14,150,000
Transaction Costs			284,776
Total			$ 14,434,776
Interest (as a percent)			100.00%
Asset Acquisitions 2020
Other disclosures
Number of properties acquired | property							2
Asset Acquisitions 2019
Other disclosures
Number of properties acquired | property								4

INVESTMENT IN HOTEL PROPERTIE_4

INVESTMENT IN HOTEL PROPERTIES - Purchase Price Allocation (Details) - Nonrecurring - USD ($)	Mar. 31, 2020	Dec. 31, 2019
2020 Acquisitions
INVESTMENT IN HOTEL PROPERTIES
Land and land improvements	$ 2,576,166
Building and building improvements	31,605,174
Furniture, fixtures, and equipment	3,007,846
Total assets acquired	37,189,186
Premium on assumed debt	(597,665)
Total liabilities assumed	(597,665)
Total purchase price	36,591,521
Assumed mortgage debt	9,400,772
Net purchase price	$ 27,190,749
2019 Acquisitions
INVESTMENT IN HOTEL PROPERTIES
Land and land improvements		$ 6,201,529
Building and building improvements		47,412,115
Furniture, fixtures, and equipment		4,772,707
Total assets acquired		58,386,351
Premium on assumed debt		(416,126)
Total liabilities assumed		(416,126)
Total purchase price		57,970,225
Assumed mortgage debt		17,283,415
Net purchase price		$ 40,686,810

DEBT - Lines of Credit (Details

DEBT - Lines of Credit (Details) - Revolving line of credit - USD ($) $ in Millions	Nov. 15, 2018	Aug. 22, 2018	Mar. 31, 2020	Dec. 31, 2018	Feb. 10, 2020	Dec. 31, 2019	Nov. 30, 2019	Oct. 31, 2019
Lender One
Debt
Revolving line of credit		$ 3	$ 3			$ 3
Partnership units pledged		300,000
Variable interest rate (as a percent)			5.00%			5.75%
Outstanding amount			$ 2			$ 0
Lender One | Corey Maple
Debt
Line of credit guarantee amount			1.2
Lender One | Norman Leslie
Debt
Line of credit guarantee amount			$ 1.2
Lender One | Minimum
Debt
Variable interest rate (as a percent)		5.00%	5.00%				5.00%	6.00%
Lender One | U.S. Prime Rate
Debt
Basis spread (as a percent)		1.00%	1.00%
Lender Two
Debt
Revolving line of credit	$ 25
Amount drew from line of credit				$ 5.2
Lender Two | 30‑day LIBOR
Debt
Basis spread (as a percent)	3.25%
Lender Three
Debt
Revolving line of credit			$ 5		$ 5
Partnership units pledged					100,000
Variable interest rate (as a percent)			3.75%
Outstanding amount			$ 3.2
Lender Three | U.S. Prime Rate
Debt
Effective interest rate					0.50%
Basis spread (as a percent)			0.50%

DEBT - Mortgage Debt and Summar

DEBT - Mortgage Debt and Summary of Debt (Details)	Aug. 22, 2018USD ($)	Mar. 31, 2020USD ($)property	Feb. 10, 2020USD ($)	Dec. 31, 2019USD ($)	Nov. 30, 2019	Oct. 31, 2019
Outstanding Debt:
Outstanding balance		$ 69,699,037
Premium on assumed debt, net		953,944		$ 389,285
Deferred financing costs, net		(1,634,072)		(1,080,040)
Debt, net		69,018,909		40,980,632
Revolving line of credit
Outstanding Debt:
Outstanding balance		5,200,000
Lender One | Revolving line of credit
Outstanding Debt:
Line of credit	$ 3,000,000	$ 3,000,000		$ 3,000,000
Interest rate (as a percent)		5.00%		5.75%
Outstanding balance		$ 2,000,000
Lender One | Revolving line of credit | Minimum
Outstanding Debt:
Interest rate (as a percent)	5.00%	5.00%			5.00%	6.00%
Lender One | Revolving line of credit | U.S. Prime Rate
Outstanding Debt:
Basis spread (as a percent)	1.00%	1.00%
Lender Three | Revolving line of credit
Outstanding Debt:
Line of credit		$ 5,000,000	$ 5,000,000
Interest rate (as a percent)		3.75%
Outstanding balance		$ 3,200,000
Lender Three | Revolving line of credit | U.S. Prime Rate
Outstanding Debt:
Basis spread (as a percent)		0.50%
Mortgage Debt
Debt
Number of house properties as security for mortgage debt | property		7
Weighted-average interest rate (as a percent)		4.54%
Outstanding Debt:
Outstanding balance		$ 64,499,037		$ 41,671,387
Mortgage Debt | Minimum
Debt
Fixed interest rate (as a percent)		3.70%
Mortgage Debt | Maximum
Debt
Fixed interest rate (as a percent)		5.33%
Holiday Inn Express (the "Cedar Rapids Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		5.33%
Outstanding balance		$ 5,665,211		5,527,392
Hampton Inn & Suites(the "Pineville Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		5.13%
Outstanding balance		$ 9,109,397		9,154,289
Hampton Inn (the "Eagan Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.60%
Outstanding balance		$ 9,317,590		9,369,276
Home2 Suites (the "Prattville Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.13%
Outstanding balance		$ 9,620,000		9,620,000
Loan interest applicable term		12 years
Home2 Suites (the “Lubbock Home2 Property”) | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.69%
Outstanding balance		$ 7,950,051		$ 8,000,430
Fairfield Inn Lubbock Hotel | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.93%
Outstanding balance		$ 9,376,788
Homewood Suites (the "Southaven Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		3.70%
Outstanding balance		$ 13,460,000

DEBT - Future Minimum Payments

DEBT - Future Minimum Payments (Details) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Future minimum payments
2020(April 1, 2020 to December 31, 2020)	$ 2,630,308
2021	4,557,344
2022	1,505,990
2023	1,576,254
2024	23,479,447
Thereafter	35,949,694
Total	69,699,037
Premium on assumed debt, net	953,944	$ 389,285
Deferred financing costs, net	(1,634,072)	(1,080,040)
Debt, net	$ 69,018,909	$ 40,980,632

FAIR VALUE OF FINANCIAL INSTR_2

FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
Fair value of financial instruments
Gross carrying value	$ 69,699,037
Mortgage Debt
Fair value of financial instruments
Fair value	65,700,000	$ 42,700,000
Gross carrying value	$ 64,499,037	$ 41,671,387

INCOME TAXES - Narrative (Detai

INCOME TAXES - Narrative (Details) - USD ($)	Mar. 31, 2020	Dec. 31, 2019
INCOME TAXES
Net deferred tax assets	$ 813,724	$ 205,808

RELATED PARTY TRANSACTIONS - Na

RELATED PARTY TRANSACTIONS - Narratives (Details)	3 Months Ended		12 Months Ended
	Mar. 31, 2020USD ($)$ / roomshares	Mar. 31, 2019USD ($)shares	Dec. 31, 2019USD ($)	Feb. 20, 2020shares	Feb. 10, 2020USD ($)	Aug. 22, 2018USD ($)
Related Party Transactions
Distributions paid	$ 691,604	$ 98,912
Loan guarantee fees	69,334	0
Loan guarantee fees payable	63,334		$ 0
Reimbursements payable	$ 338,883		966,379
Advisor And Affiliates
Related Party Transactions
Guarantee fees (as a percent)	1.00%
NHS
Related Party Transactions
Renewal term of advisory agreement	5 years
Monthly base management fee (as a percent)	4.00%
Accounting fee per room | $ / room	14
Administrative fee (as a percent)	0.60%
Home2 Suites (the "Prattville Property")
Related Party Transactions
Loan amount	$ 9,600,000
Homewood Suites (the "Southaven Property")
Related Party Transactions
Loan amount	13,500,000
Hampton Inn & Suites(the "Pineville Property")
Related Party Transactions
Loan amount	9,300,000
Revolving line of credit | Lender One
Related Party Transactions
Revolving line of credit	3,000,000		3,000,000			$ 3,000,000
Revolving line of credit | Lender One | Corey Maple
Related Party Transactions
Line of credit guarantee amount	1,200,000
Revolving line of credit | Lender One | Norman Leslie
Related Party Transactions
Line of credit guarantee amount	1,200,000
Revolving line of credit | Lender Three
Related Party Transactions
Revolving line of credit	$ 5,000,000				$ 5,000,000
Revolving line of credit | Lender Three | Corey Maple
Related Party Transactions
Partnership units held as collateral | shares				100,000
Advisory Agreement | Legendary Capital REIT III, LLC
Related Party Transactions
Term of advisory agreement	10 years
Acquisition fee (as a percent)	1.40%
Financing fee (as a percent)	1.40%
Asset management fee (as a percent)	0.75%
Refinancing fee (as a percent)	0.75%
Real estate commissions, maximum (as a percent)	5.00%
Annual guarantee fee (as a percent)	1.00%
Annual subordinated performance fee (as a percent)	20.00%
Cumulative return (as a percent)	6.00%
Distributions (as a percent)	5.00%
Distributions as a percent of the limited partners' capital contributions in event of liquidation, termination, merger or other cessation (as a percent)	5.00%
Distributions as a percent of net proceeds from sale of properties in event of liquidation, termination, merger or other cessation (as a percent)	20.00%
Reimbursement after termination of the Offering (as a percent)	15.00%
Distributions payable	$ 60,308	14,004
Advisory Agreement | Legendary Capital REIT III, LLC | Maximum
Related Party Transactions
Disposal fee (as a percent)	4.00%
Real estate commissions (as a percent)	3.00%
Advisory Agreement | Legendary Capital REIT III, LLC | Minimum
Related Party Transactions
Disposal fee (as a percent)	0.00%
Advisory Agreement | Legendary Capital REIT III, LLC | Advisor And Affiliates
Related Party Transactions
Distributions payable	$ 123,925		$ 63,617
Advisory Agreement | Legendary Capital REIT III, LLC | Corey Maple
Related Party Transactions
Distributions paid	$ 9,409	$ 9,409
Number of shares held by shareholders | shares	53,763	53,763
Advisory Agreement | Legendary Capital REIT III, LLC | Norman Leslie
Related Party Transactions
Distributions paid	$ 9,409	$ 9,409
Number of shares held by shareholders | shares	53,763	53,763

RELATED PARTY TRANSACTIONS - Le

RELATED PARTY TRANSACTIONS - Legendary Capital (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Advisor And Affiliates
Related Party Transactions
Fees incurred	$ 1,201,063	$ 426,432
Fees payable	74,464		$ 576,727
Reimbursements incurred	1,538,783	1,284,494
Reimbursements payable	80,808		278,518
Advisor And Affiliates | Acquisition Fees
Related Party Transactions
Fees incurred	501,949	200,324
Fees payable			213,402
Advisor And Affiliates | Financing Fees
Related Party Transactions
Fees incurred	501,949	200,324
Fees payable			213,402
Advisor And Affiliates | Asset Management Fees
Related Party Transactions
Fees incurred	197,165	25,784
Fees payable	74,464		81,389
Advisor And Affiliates | Performance Fees
Related Party Transactions
Fees payable			68,534
Advisor And Affiliates | Offering Costs
Related Party Transactions
Reimbursements incurred	583,926	611,135
Reimbursements payable	21,179		122,833
Advisor And Affiliates | General and Administrative
Related Party Transactions
Reimbursements incurred	813,575	523,066
Reimbursements payable	26,549		120,386
Advisor And Affiliates | Sales and Marketing
Related Party Transactions
Reimbursements incurred	76,153	91,342
Reimbursements payable	9,647		3,333
Advisor And Affiliates | Acquisition Costs
Related Party Transactions
Reimbursements incurred	64,847	58,951
Reimbursements payable	15,956		31,966
Advisor And Affiliates | Other Costs
Related Party Transactions
Reimbursements incurred	282
Reimbursements payable	7,477
Legendary Capital REIT III, LLC | Advisory Agreement
Related Party Transactions
Distributions	60,308	$ 14,004
Legendary Capital REIT III, LLC | Advisor And Affiliates | Advisory Agreement
Related Party Transactions
Distributions	$ 123,925		$ 63,617

RELATED PARTY TRANSACTIONS - NH

RELATED PARTY TRANSACTIONS - NHS (Details) - NHS - USD ($)	3 Months Ended
	Mar. 31, 2020	Mar. 31, 2019	Dec. 31, 2019
Related Party Transactions
Fees incurred	$ 154,772	$ 38,449
Fees payable	49,971		$ 38,944
Reimbursements incurred	80,576	16,790
Reimbursements payable	9,715		8,572
Management Fees
Related Party Transactions
Fees incurred	116,089	24,207
Fees payable	36,182		30,024
Administrative Fees
Related Party Transactions
Fees incurred	17,863	9,202
Fees payable	5,821		4,617
Accounting Fees
Related Party Transactions
Fees incurred	20,820	$ 5,040
Fees payable	$ 7,968		$ 4,303

FRANCHISE AGREEMENTS - (Details

FRANCHISE AGREEMENTS - (Details)	3 Months Ended
	Mar. 31, 2020USD ($)
Maximum
Franchise Agreements
Initial term of franchise agreement	18 years
Royalty fee (as a percent)	6.00%
Program fee (as a percent)	4.00%
Initial franchise fee	$ 175,000
Minimum
Franchise Agreements
Initial term of franchise agreement	10 years
Royalty fee (as a percent)	5.00%
Program fee (as a percent)	3.00%
Initial franchise fee	$ 50,000

STOCKHOLDERS' EQUITY (Details)

STOCKHOLDERS' EQUITY (Details)	3 Months Ended
	Mar. 31, 2020USD ($)Vote$ / sharesshares	Dec. 31, 2019USD ($)$ / sharesshares	Jun. 01, 2018USD ($)$ / shares
Stockholders' Equity
Common stock, shares authorized | shares	900,000,000	900,000,000
Preferred stock, shares authorized | shares	100,000,000	100,000,000
Common stock voting rights | Vote	1
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Percentage of current share net asset value	95.00%
Common stock dividends per share declared on daily rate basis	$ 0.00191781
Share repurchase plan, amount available for eligible repurchases | $	$ 707,133	$ 49,530
Private offering
Stockholders' Equity
Common stock, par value (in dollars per share)			$ 0.01
Common stock, offering price			$ 10
Maximum offering | $			$ 100,000,000

SUBSEQUENT EVENTS - (Details)

SUBSEQUENT EVENTS - (Details)	Apr. 29, 2020$ / sharesshares	Apr. 30, 2020USD ($)item	May 14, 2020USD ($)$ / sharesshares	Mar. 31, 2020USD ($)$ / sharesshares	Feb. 21, 2020USD ($)	Dec. 31, 2019$ / sharesshares	Jul. 11, 2019USD ($)	Jun. 19, 2019USD ($)	Mar. 05, 2019USD ($)	Jun. 01, 2018$ / shares
Subsequent Events
Common stock, shares authorized | shares				900,000,000		900,000,000
Common stock, par value (in dollars per share) | $ / shares				$ 0.01		$ 0.01
Cumulative number of shares issued since inception of the Offering | shares				6,996,670
Cumulative number of shares issued pursuant to the DRIP | shares				133,331
Cumulative gross proceeds from issuance of stock since inception of the Offering				$ 68,700,000
Private offering
Subsequent Events
Common stock, par value (in dollars per share) | $ / shares										$ 0.01
Share price (in dollars per share) | $ / shares										$ 10
Holiday Inn Express (the "Cedar Rapids Property") | Mortgage Debt
Subsequent Events
Loan amount									$ 5,860,000
Interest rate (as a percent)				5.33%
Hampton Inn (the "Eagan Property") | Mortgage Debt
Subsequent Events
Loan amount								$ 9,440,000
Interest rate (as a percent)				4.60%
Home2 Suites (the "Prattville Property")
Subsequent Events
Loan amount				$ 9,600,000
Home2 Suites (the "Prattville Property") | Mortgage Debt
Subsequent Events
Loan amount							$ 9,600,000
Interest rate (as a percent)				4.13%
Homewood Suites (the "Southaven Property")
Subsequent Events
Loan amount				$ 13,500,000
Homewood Suites (the "Southaven Property") | Mortgage Debt
Subsequent Events
Loan amount					$ 13,500,000
Interest rate (as a percent)				3.70%
Subsequent Event
Subsequent Events
Cumulative number of shares issued since inception of the Offering | shares			7,136,866
Cumulative number of shares issued pursuant to the DRIP | shares			133,331
Cumulative gross proceeds from issuance of stock since inception of the Offering			$ 70,100,000
Subsequent Event | Repurchase Plan
Subsequent Events
Minimum period of time holders of Interval Common Stock shares must be required to have held the Interval Common Stock shares to participate in the Repurchase Plan	1 year
Limit of repurchases of Interval Common Shares after Repurchase Reserve has been exhausted, percentage per calendar quarter	1.25%
Limit of repurchases of Interval Common Shares after Repurchase Reserve has been exhausted, percentage per calendar year of the Interval Shares Value	5.00%
Repurchase Reserve expressed as a percentage of the aggregate gross proceeds from the Company's private offering of Interval Shares	20.00%
Notice period	10 days
Subsequent Event | Interval Common Stock
Subsequent Events
Common stock, shares authorized | shares	7,000,000
Common stock, par value (in dollars per share) | $ / shares	$ 0.01
Dividend rate (as a percent)	86.00%
Share price, dividend reinvestment plan (in dollars per share) | $ / shares			9.50
Subsequent Event | PPP Loans
Subsequent Events
Number of unsecured promissory notes | item		6
Loan amount		$ 763,100
Interest rate (as a percent)		1.00%
Term of loan		2 years
Term of deferment of interest		6 months
Prepayment penalties		$ 0
Subsequent Event | Private offering | Interval Common Stock
Subsequent Events
Maximum number of shares authorized per the offering | shares			3,000,000
Maximum number of shares authorized per the offering at the sole direction of the Board of Directors | shares			6,000,000
Share price (in dollars per share) | $ / shares			$ 10
Subsequent Event | Last day of same calendar quarter preceding year | Repurchase Plan
Subsequent Events
Percentage of Aggregate Value of Interval Shares to be repurchased, threshold	5.00%
Subsequent Event | Last day of preceding calendar quarter | Repurchase Plan
Subsequent Events
Percentage of Aggregate Value of Interval Shares to be repurchased, threshold	5.00%