Lodging Fund Reit Iii 10-Q 17 May 21 2021 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2021	May 17, 2021
Document and Entity Information [Abstract]
Document Type	10-Q
Document Period End Date	Mar. 31, 2021
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		7,942,025
Entity Central Index Key	0001745032
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Amendment Flag	false

CONSOLIDATED BALANCE SHEETS

CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2021	Dec. 31, 2020
Assets
Investment in hotel properties, net of accumulated depreciation of $5,715,332 and $4,712,578	$ 124,085,114	$ 100,744,186
Cash and cash equivalents	7,547,457	7,960,159
Restricted cash	5,414,955	4,568,908
Accounts receivable, net	224,016	114,282
Franchise fees, net	1,111,468	955,238
Prepaid expenses and other assets	1,996,728	2,071,708
Total Assets	140,379,738	116,414,481
Liabilities and Equity
Debt, net	78,458,927	63,924,719
PPP Loan	801,800	763,100
Accounts payable	1,020,862	670,548
Accrued expenses	1,350,332	1,560,931
Distributions payable	1,358,705	1,327,912
Due to related parties	2,432,640	1,904,051
Other liabilities	440,115	653,292
Total liabilities	85,863,381	70,804,553
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; 7,807,944 and 7,611,653 shares issued and outstanding	78,079	76,116
Additional paid-in capital	76,485,072	74,610,627
Accumulated deficit	(34,926,072)	(31,855,995)
Total stockholders' equity	41,637,079	42,830,748
Total equity	54,516,357	45,609,928
Total Liabilities and Equity	140,379,738	116,414,481
Series B LP Units
Equity
Non-controlling interest	(1,160,274)	(1,005,785)
Series GO LP Units
Equity
Non-controlling interest	7,291,975	$ 3,784,965
Series T LP Units
Equity
Non-controlling interest	$ 6,747,577

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Mar. 31, 2021	Dec. 31, 2020
CONSOLIDATED BALANCE SHEETS
Accumulated depreciation	$ 5,715,332	$ 4,712,578
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	7,807,944	7,611,653
Common stock, shares outstanding	7,807,944	7,611,653

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Revenues
Total revenue	$ 3,785,161	$ 3,832,506
Expenses
Property operations	1,742,248	1,650,313
General and administrative	1,345,842	1,388,284
Sales and marketing	305,454	371,070
Franchise fees	296,352	319,901
Management fees	438,090	395,204
Acquisition expense	27,466	72,995
Depreciation	1,003,052	818,401
Total expenses	5,158,504	5,016,168
Other Income (Expense)
Other income (expense), net	678,875	(72,524)
Interest expense	(947,073)	(735,766)
Total other income (expense)	(268,198)	(808,290)
Net Loss Before Income Taxes	(1,641,541)	(1,991,952)
Income tax benefit (expense)	(25,000)	607,916
Net Loss	(1,666,541)	(1,384,036)
Net Loss Attributable to Common Stockholders	$ (1,423,627)	$ (1,314,880)
Basic and Diluted Net Loss Per Share of Common Stock	$ (0.18)	$ (0.20)
Weighted-average Shares of Common Stock Outstanding, Basic and Diluted	7,751,978	6,539,024
Series B LP Units
Other Income (Expense)
Net loss attributable to non-controlling interest	$ (82,978)	$ (69,156)
Series GO LP Units
Other Income (Expense)
Net loss attributable to non-controlling interest	(159,936)
Room
Revenues
Total revenue	3,720,791	3,777,730
Other
Revenues
Total revenue	$ 64,370	$ 54,776

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 InterestSeries B LP Units	Non-controlling InterestSeries GO LP Units	Non-controlling InterestSeries T LP Units	Total
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 (in shares)	44,030
Redemptions	$ 100	91,900		92,000				92,000
Redemptions (in 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
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
Redemptions								$ 590,547
Redemptions (in shares)								64,190
Balance - Ending at Dec. 31, 2020	$ 76,116	74,610,627	(31,855,995)	42,830,748	(1,005,785)	$ 3,784,965		$ 45,609,928
Balance - Ending (Shares) at Dec. 31, 2020	7,611,653
Issuance of common stock	$ 824	793,756		794,580				794,580
Issuance of common stock (Shares)	82,414
Issuance of GO Units						4,201,300		4,201,300
Issuance of T Units							$ 6,747,577	6,747,577
Offering costs			(287,745)	(287,745)		(534,354)		(822,099)
Distributions declared			(1,358,705)	(1,358,705)	(71,511)			(1,430,216)
Distributions reinvested	$ 1,139	1,080,689		1,081,828				$ 1,081,828
Distributions reinvested (in shares)	113,877
Redemptions (in shares)								0
Net loss			(1,423,627)	(1,423,627)	(82,978)	(159,936)		$ (1,666,541)
Balance - Ending at Mar. 31, 2021	$ 78,079	$ 76,485,072	$ (34,926,072)	$ 41,637,079	$ (1,160,274)	$ 7,291,975	$ 6,747,577	$ 54,516,357
Balance - Ending (Shares) at Mar. 31, 2021	7,807,944

CONSOLIDATED STATEMENTS OF CH_2

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical) - $ / shares	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
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, 2021	Mar. 31, 2020
Cash Flows from Operating Activities:
Net loss	$ (1,666,541)	$ (1,384,036)
Adjustments to reconcile net loss to cash used in operating activities:
Depreciation	1,003,052	818,401
Amortization	81,780	58,352
Gain on PPP 1oan forgiveness	(763,100)
Deferred tax assets, net		(186,573)
Change in operating assets and liabilities:
Accounts receivable	(109,734)	11,467
Franchise fees	(175,000)	(300,000)
Prepaid expenses and other assets	74,980	(50,364)
Accounts payable	297,381	147,028
Accrued expenses	(202,599)	496,689
Due to related parties	381,586	(623,882)
Other liabilities	(214,040)	(129,055)
Net cash used in operating activities	(1,292,235)	(1,141,973)
Cash Flows from Investing Activities:
Acquisitions of hotel properties	(1,862,423)	(27,190,749)
Improvements and additions to hotel properties	(733,980)	(196,753)
Net cash used in investing activities	(2,596,403)	(27,387,502)
Cash Flows from Financing Activities:
Proceeds from mortgage debt		13,597,819
Proceeds from lines of credit	1,000,000	6,200,000
Proceeds from PPP loans	801,800
Principal payments on mortgage debt	(197,147)	(170,941)
Principal payments on lines of credit	(1,000,000)	(1,000,000)
Payments of deferred financing costs	(330,792)	(633,572)
Proceeds from issuance of common stock	794,580	9,381,533
Proceeds from issuance of units	4,201,300
Payments of offering costs	(701,674)	(1,612,371)
Payments for shares redeemed		(92,000)
Distributions paid	(246,084)	(691,604)
Net cash provided by financing activities	4,321,983	24,978,864
Net change in cash, cash equivalents, and restricted cash	433,345	(3,550,611)
Beginning Cash, Cash Equivalents, and Restricted Cash	12,529,067	16,174,371
Ending Cash, Cash Equivalents, and Restricted Cash	12,962,412	12,623,760
Supplemental Disclosure of Cash Flow Information:
Interest paid, net of amounts capitalized	889,861	577,708
Income taxes paid	1,963
Supplemental Disclosure of Non-Cash Investing and Financing Activities:
Issuance of Units for Aurora property	6,747,577
Debt issued for acquisition of Aurora property	15,000,000
Debt assumed in connection with hotel property acquisition		9,998,437
Offering costs included in accounts payable	52,933	(7,020)
Offering costs included in due to related parties	75,492	(63,922)
Offering costs included in accrued expenses	(8,000)	(20,782)
Distributions included in accrued expenses		34,712
Distributions included in due to related parties	71,511	60,308
Reinvested distributions	1,081,828	418,286
Reconciliation of Cash, Cash Equivalents, and Restricted Cash:
Cash and cash equivalents, beginning of period	7,960,159	10,898,556
Restricted cash, beginning of period	4,568,908	5,275,815
Cash, cash equivalents, and restricted cash, beginning of period	12,962,412	12,623,760
Cash and cash equivalents, end of period	7,547,457	7,934,605
Restricted cash, end of period	5,414,955	4,689,155
Cash, cash equivalents, and restricted cash, end of period	$ 12,962,412	$ 12,623,760

ORGANIZATION

ORGANIZATION	3 Months Ended
	Mar. 31, 2021
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 three voting classes of partnership units, Common General Partnership Units (“GP Units”), Interval Units and Common Limited Partnership Units (“Common LP Units”), and three classes of non-voting partnership units, Series B Limited Partnership Units (“Series B LP Units”), Series Growth & Opportunity (“GO”) Limited Partnership Units (“Series GO LP Units”) and Series T Limited Partnership Units (“Series T LP Units”). LF REIT III was the sole general partner of the OP, as of March 31, 2021 and December 31, 2020. As of March 31, 2021 and December 31, 2020, there were no outstanding Common LP Units or Interval Units, and there were 1,000 outstanding Series B LP Units, all of which were owned by the Advisor. As of March 31, 2021 and December 30, 2020, there were 1,103,758 and 0 Series T LP Units outstanding, respectively. As of March 31, 2021 and December 30, 2020, there were 1,258,817 and 654,868 Series GO LP Units outstanding, respectively. 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, 2021, the Company had issued and sold 7,872,134 shares of common stock, including 506,688 shares attributable to the DRIP, and received aggregate proceeds of $76.6 million. As of December 31, 2020, the Company had repurchased 64,190 shares, which represents an original investment of $641,898, including $16,898 of DRIP, for $590,547 under the Company’s Share Repurchase Plan. As of March 31, 2021, there were no outstanding redemption proceeds needing to be paid. On April 29, 2020, the Company classified and designated 7,000,000 shares of authorized but unissued common stock, $0.01 par value per share, as shares of “Interval Common Stock,” to be part of the Offering. The offering of the Interval Common Stock, is a maximum offering of $30,000,000, which may be increased to $60,000,000 in the sole discretion of the Company’s board of directors, (the “Interval Share Offering”) to accredited investors only, pursuant to a confidential private placement memorandum exempt from registration under the Securities Act of 1933, as amended. As of March 31, 2021, the Company had not issued or sold any shares of Interval Common Stock. On June 15, 2020, the Operating Partnership commenced a private offering of limited partnership units in the OP, designated as Series GO LP Units, with a maximum offering of $20,000,000, which may be increased to $30,000,000 in the sole discretion of LF REIT III as the General Partner of the OP, (the “GO Unit Offering”) to accredited investors only, pursuant to a confidential private placement memorandum exempt from registration under the Securities Act of 1933, as amended. As of March 31, 2021, the Company had issued and sold 1,258,817 Series GO LP Units and received aggregate proceeds of $8.7 million.

SUMMARY OF SIGNIFICANT ACCOUNTI

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES	3 Months Ended
	Mar. 31, 2021
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, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. 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. 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 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. Although the Company’s hotel properties have remained open through the pandemic in 2020 and 2021, the Company’s occupancy levels have been lower than historic levels. The outbreak could have a continued adverse impact on economic and market conditions and could trigger a continued slowdown in leisure and business travel, which is adversely impacting the travel and hospitality industries. The 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, 2021, 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, 2021 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. 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, including the impact of COVID-19, 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. Advertising Costs – The Company expenses advertising costs as incurred. These costs represent the expense for franchise advertising and reservation systems under the terms of the hotel management and franchise agreements and expenses that are directly attributable to advertising and promotion. Advertising expense was $136,995 and $169,959 for the three months ended March 31, 2021 and 2020, respectively, and is included in sales and marketing in the consolidated statement of operations. Non-controlling Interest —Non-controlling interests represent the portion of equity related to shares with limited voting interest. 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, 2021 and December 31, 2020, restricted cash on the accompanying consolidated balance sheets included $1.8 million and $1.85 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 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, 2021 and 2020, 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. 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 fiscal year ending December 31, 2022, and for interim periods beginning on January 1, 2022. 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, 2021
INVESTMENT IN HOTEL PROPERTIES
INVESTMENT IN HOTEL PROPERTIES	3. INVESTMENT IN HOTEL PROPERTIES Investment in hotel properties as of March 31, 2021 and December 31, 2020 consisted of the following: March 31, December 31, 2021 2020 Land and land improvements $ 14,730,590 $ 10,324,772 Building and building improvements 103,262,396 85,213,846 Furniture, fixtures, and equipment 10,721,289 8,927,694 Construction in progress 1,086,171 990,452 Investment in hotel properties, at cost 129,800,446 105,456,764 Less: accumulated depreciation (5,715,332) (4,712,578) Investment in hotel properties, net $ 124,085,114 $ 100,744,186 As of March 31, 2021, the Company owned eight hotel properties with an aggregate of 847 rooms located in seven states. Acquisitions of Hotel Properties The Company acquired one property during the three months ended March 31, 2021 and two properties during the year ended December 31, 2020. Each of the Company’s hotel acquisitions to date have been determined to be asset acquisitions. The table below outlines the details of the property acquired during the three months ended March 31, 2021. 2021 Acquisitions Number Date of Guest Purchase Transaction % Hotel Property Type Location Acquired Rooms Price Costs Total Interest Courtyard by Marriott Select Service Aurora, CO February 4, 2021 141 $ 23,610,000 (1) $ 458,129 $ 24,068,129 100 % 141 $ 23,610,000 $ 458,129 $ 24,068,129 (1) Includes the issuance of 1,103,758 Series T LP Units of the Operating Partnership The table below outlines the details of the properties acquired during the year ended December 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 Each of the Company’s hotel properties, except the Southaven Property, 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 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. As of March 31, 2021, no amounts were owed or paid to the seller of the Pineville Property, and no election to receive the additional consideration had been made. The Aurora Property was acquired on February 4, 2021 for contractual consideration comprising of $15.0 million in debt, $1.9 million in cash paid at closing and the issuance of 1,103,758 Series T LP Units of the Operating Partnership” (the “Series T Units”). The Series T Units will convert into Common Limited Units of the Operating Partnership beginning 36 months, or at the option of the Company, up to 48 months, after February 4, 2021, at which point the value will be calculated pursuant to the terms of a Contribution Agreement, dated as of September 1, 2020, as amended on February 4, 2021 (the “Contribution Agreement”). The number of Common Limited Units to be issued to the Company based on such conversion may be higher or lower than the initial valuation of the Series T Units. Accordingly, the aggregate purchase price used for the acquisition accounting noted in the tables above and below of $23.6 million, was determined to be the value assigned by a third-party appraisal, as the appraisal value was more reliably measurable. The aggregate purchase price for the hotel properties acquired during the three months ended March 31, 2021 and the year ended December 31, 2020 were allocated as follows: March 31, December 31, 2021 2020 Land and land improvements $ 4,400,098 $ 2,576,166 Building and building improvements 18,048,551 31,605,174 Furniture, fixtures, and equipment 1,619,480 3,007,846 Total assets acquired 24,068,129 37,189,186 Premium on assumed debt — (597,665) Total liabilities assumed — (597,665) Total purchase price (1) 24,068,129 36,591,521 Assumed mortgage debt — 9,400,772 Net purchase price $ 24,068,129 $ 27,190,749 (1) Total purchase price includes purchase price plus all transaction costs.

DEBT

DEBT	3 Months Ended
	Mar. 31, 2021
DEBT
DEBT	4. DEBT Lines of Credit On February 10, 2020, the Company entered into a $5.0 million revolving line of credit. 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. On January 19, 2021, the line of credit was amended to extend the maturity date to May 10, 2021. The line of credit had 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, 2021. On May 6, 2021, the line of credit was amended to extend the maturity date to May 10, 2022. On that date, the interest rate was also amended to incorporate an interest rate floor equal to 4.00%. 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 Common LP 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, 2021, there was no outstanding balance on the line 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 had a variable interest rate equal to the U.S. Prime Rate, plus 1.00%, with a minimum rate of 5.00%. The line of credit required monthly payments of interest only, with all principal due at maturity. 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. The line of credit was not renewed on November 22, 2020 and the loan was closed. Mortgage Debt As of March 31, 2021, the Company had $79.3 million in outstanding mortgage debt secured by eight properties, with maturity dates ranging from February 2024 to April 2029. Seven of the loans have fixed interest rates ranging from 3.70% to 5.33%, and a weighted-average interest rate of 4.54%. One of the loans is a variable interest loan at a rate of LIBOR plus 6.0% per annum, provided that LIBOR shall not be less than 1.0%, resulting in an effective rate of 7% as of March 31, 2021. 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, 2021 and December 31, 2020, certain mortgage debt was guaranteed by the members of the Advisor. Except as described below, the Company was either in compliance with all debt covenants or received a waiver of testing of its debt covenants as of March 31, 2021 and December 31, 2020. As of March 31, 2021, the Company was not in compliance with the required financial covenants under the terms of its promissory note secured by the Pineville Property and related loan documents (the “Pineville Loan”), which constitutes an event that puts the Company into a trigger period pursuant to the loan documents. At the onset of a trigger period, the Pineville Loan will enter into a cash management period. The Company has requested a waiver of the financial covenants as of March 31, 2021 and December 31, 2020, but as of the date of this filing it had not been received. If the Company is unable to obtain a waiver, the loan will go into cash management, however the other terms of the Pineville Loan will not change, including the timing or amounts of payments, or the expiration date. The lender for the Company’s loan secured by the Lubbock Fairfield Property (the “Lubbock Fairfield Loan”) waived the required financial covenants under the terms of the Lubbock Fairfield Loan through March 31, 2021. The promissory note and related loan documents regarding the Lubbock Home2 Property did not have any required financial covenants as of March 31, 2021 and December 31, 2020. Other than as described above for the Pineville Loan, the Company was either in compliance with its debt covenants or received a waiver of testing of its debt covenants as of March 31, 2021 and December 31, 2020 as noted below. 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 $5.9 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 was deferred until October 1, 2020. In addition to the Cedar Rapids Amendment, the lender has also waived the required financial covenants under the terms of the Cedar Rapids Note through December 31, 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 $9.4 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 was deferred until October 1, 2020. In addition to the Eagan Amendment, the lender has also waived the required financial covenants under the terms of the Eagan Note through December 31, 2020. On April 22, 2020, the Company entered into a Forbearance Agreement (the “Prattville Forbearance Agreement”), 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 did not make interest payments that were due and payable during the Prattville Forbearance Period (as defined below) which constituted 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 lender further agreed to defer the interest accrued during the Prattville Forbearance Period such that the accrued interest of $100,878 was paid-in-kind and added to the outstanding principal balance of the loan. The forbearance period (the “Prattville Forbearance Period”) was the period from May 1, 2020 through July 31, 2020. On August 14, 2020, the Prattville Loan was amended (the “Prattville Amendment”) to waive the Prattville Projected Events of Default and to adjust other terms of the Prattville Loan. The Prattville Amendment, among other things, extended the required PIP completion date to align with the extension provided by the franchise agreement, adjusted certain financial covenants, put into place certain liquidity requirements and added restrictions on capital expenditures, related party payments, including management fees payable to NHS and loan guarantee fees, and cash distributions until certain financial covenants are achieved. Pursuant to the Prattville Forbearance Agreement and Prattville Amendment, until certain financial covenants are achieved, the borrower may not make any payments for capital expenditures or any distributions and must maintain a minimum cash balance of $155,000 in its hotel operating account. The restriction on distributions precludes the borrower subsidiary entities from making distributions of cash to the Operating Partnership, and as of December 31, 2020, the borrower subsidiary entities had cash balances in the amount of $831,379, which is included in cash and cash equivalents on the accompanying consolidated balance sheets. The Company was in compliance with the required financial covenants under the terms of the Prattville Amendment through March 31, 2021. On April 22, 2020, the Company entered into a Forbearance Agreement (the “Southaven Forbearance Agreement”), 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 did not make interest payments that were due and payable during the Southaven Forbearance Period (as defined below) which constituted 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 lender further agreed to defer the interest accrued during the Southaven Forbearance Period such that the accrued interest of $126,110 was paid-in-kind and added to the outstanding principal balance of the loan. The forbearance period (the “Southaven Forbearance Period”) was the period from May 1, 2020 through July 31, 2020. On August 14, 2020, the Southaven Loan was amended (the “Southaven Amendment”) to waive the Southaven Projected Events of Default and to adjust other terms of the Southaven Loan. The Southaven Amendment, among other things, extended the required PIP completion date to align with the extension provided by the franchise agreement, adjusted certain financial covenants, put into place certain liquidity requirements and added restrictions on capital expenditures, related party payments, including loan guarantee fees, and cash distributions until certain financial covenants are achieved. Pursuant to the Southaven Forbearance Agreement and Southaven Amendment, until certain financial covenants are achieved, the borrower may not make any payments for capital expenditures or any distributions and must maintain a minimum cash balance of $225,000 in its hotel operating account. The restriction on distributions precludes the borrower subsidiary entities from making distributions of cash to the Operating Partnership, and as of December 31, 2020, the borrower subsidiary entities had cash balances in the amount of $1,498,889, which is included in cash and cash equivalents on the accompanying consolidated balance sheets. The Company did not have any required financial covenants under the terms of the Southaven loan in effect as of December 31, 2020. The Company was in compliance with the required financial covenants under the terms of the Southaven Amendment as of March 31, 2021. Paycheck Protection Program (“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 Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”), which was passed in March 2020, and is administered by the U.S. Small Business Administration (the “SBA”). The term of each PPP loan is 2 years, which may be extended to 5 years at the Company’s election. The interest rate on each PPP loan is 1.0% per annum, which shall be deferred for a period of time. After the initial 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 initial deferral period ends at either i) the date the SBA remits the borrower’s loan forgiveness amount, or ii) if the Company has not applied for loan forgiveness, 10 months after the end of the borrower’s loan forgiveness covered period. The Company’s covered period ended September 25, 2020, for two of its PPP loans and ended October 2, 2020, for four of its PPP loans. 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. As of December 31, 2020, the outstanding balance of the PPP Loans was $763,100. In February 2021, we applied for and received one hundred percent (100%) forgiveness of all six PPP Loans. In January 2021, the Company entered into six new unsecured promissory notes totaling $716,400, under the Second Draw Paycheck Protection Program (the “Second Draw PPP”) created by the Consolidated Appropriations Act, 2021 (the “CAA Act”), through Western State Bank. The term of each Second Draw PPP loan is five years. The interest rate on each Second Draw PPP loan is 1.0% per annum, which shall be deferred for the first sixteen months of the term of the loan. After the initial sixteen-month deferral period, each loan requires monthly payments of principal and interest until maturity with respect to any portion of such Second Draw PPP loan which is not forgiven as described below. The Company is permitted to prepay each Second Draw PPP loan at any time with no prepayment penalties. In February 2021, the Company, through its subsidiary LF3 Southaven TRS, LLC (“Southaven TRS”), entered into an unsecured promissory note under the PPP through Western State Bank. The amount of the PPP loan for Southaven TRS is $85,400. The term of each PPP loan is five years. The interest rate on the PPP loan is 1.0% per annum, which shall be deferred for the first sixteen months of the term of the loan. After the initial sixteen-month deferral period, the loan requires monthly payments of principal and interest until maturity with respect to any portion of the PPP loan which is not forgiven as described below. The Company is permitted to prepay the PPP loan at any time with no prepayment penalties. Under the terms of the CARES Act and the CAA Act, as applicable, PPP loan recipients and Second Draw PPP loan recipients can apply for, and be granted, forgiveness for all or a portion of such loans. 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, the maintenance of employee and compensation levels and certain other approved expenses. N o assurance is provided that the Company will obtain forgiveness of any or all of the Second Draw PPP loans or the PPP loan for Southaven TRS in whole or in part. The following table sets forth the hotel properties securing each loan, the interest rate, maturity date, and the outstanding balance as of March 31, 2021 and December 31, 2020 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 2021 Date 2021 2020 Holiday Inn Express - Cedar Rapids (1) 5.33% 09/01/2024 $ 5,858,134 $ 5,858,134 Hampton Inn & Suites - Pineville 5.13% 06/06/2024 8,925,255 8,973,775 Hampton Inn - Eagan 4.60% 01/01/2025 9,317,589 9,317,589 Home2 Suites - Prattville (1) 4.13% 08/01/2024 9,591,110 9,647,085 Home2 Suites - Lubbock 4.69% 10/06/2026 7,737,573 7,792,602 Fairfield Inn & Suites - Lubbock 4.93% 04/06/2029 9,235,247 9,272,870 Homewood Suites - Southaven (1) 3.70% 03/03/2025 13,586,110 13,586,110 Courtyard by Marriott - Aurora 7.00% 02/05/2024 15,000,000 — Total Mortgage Debt 79,251,018 64,448,165 Premium on assumed debt, net 821,922 854,928 Deferred financing costs, net (1,614,013) (1,378,374) Net Mortgage 78,458,927 63,924,719 $3.0 million line of credit (2) — 11/22/2020 — — $5.0 million line of credit 3.75% (3) 5/10/2022 — — Total Lines of Credit — — PPP Loans 1.00% Various (4) 801,800 763,100 Debt, net $ 79,260,727 $ 64,687,819 (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) Loan was not renewed at maturity. (3) Variable interest rate equal to U.S. Prime Rate plus 0.50%. One May 6, 2021, the loan was amended to incorporate an interest rate floor of 4.0% (4) Each of the currently outstanding PPP loans has a five year term. All six PPP loans which were outstanding as of December 31, 2020 were forgiven in February 2021. Future Minimum Payments As of March 31, 2021, the future minimum principal payments on the Company’s debt were as follows: 2021 $ 861,353 2022 1,544,938 2023 1,737,149 2024 39,242,552 2025 21,579,995 Thereafter 15,086,831 80,052,818 Premium on assumed debt, net 821,922 Deferred financing costs, net (1,614,013) $ 79,260,727

FAIR VALUE OF FINANCIAL INSTRUM

FAIR VALUE OF FINANCIAL INSTRUMENTS	3 Months Ended
	Mar. 31, 2021
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, 2021 and December 31, 2020 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, 2021. 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, 2021, the estimated fair value of the Company’s mortgage debt was $83.4 million, compared to the gross carrying value $79.3 million. As of December 31, 2020, the estimated fair value of the Company’s mortgage debt was $67.5 million, compared to the gross carrying value $64.4 million.

INCOME TAXES

INCOME TAXES	3 Months Ended
	Mar. 31, 2021
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, 2021 and 2020. The Company did not have any uncertain tax positions as of March 31, 2021 or December 31, 2020. The Company’s TRS generated a net operating loss (“NOL”) for the three months ended March 31, 2021 and the year ended December 31, 2020, which can be carried forward to offset future taxable income. As of June 30, 2020, the Company recorded a partial valuation allowance against its deferred tax assets of $1.1 million, primarily related to the uncertainty of effects of the ongoing COVID-19 pandemic on hospitality and travel industries. During the three months ended September 30, 2020, the Company experienced some level of recovery, from the unprecedented lows in April and May 2020, at all of our hotel properties. As a result, the Company revised the partial valuation allowance against deferred tax assets to $600,901 as of September 30, 2020. Based on the Company’s actual results through March 31, 2021, and general industry projections that the hotel industry will return to 2019 levels of activity and RevPAR sometime during 2024 or 2025, the Company expects to fully utilize our NOL to offset future taxable income prior to expiration. As such, the Company has not recorded a valuation allowance against its deferred tax assets as of March 31, 2021. As of December 31, 2020, the Company had a recorded net deferred tax asset of $1,466,942, primarily attributable to its NOLs generated in the 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, 2021, the tax years 2019 through 2020 remain subject to examination by the U.S. Internal Revenue Service (“IRS”) and various state tax jurisdictions. The CARES Act contains numerous income tax provisions, such as temporarily relaxing limitations on the deductibility of interest expense, accelerating depreciable lives of certain qualified building improvements, and allowing 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, for tax years beginning prior to 2021, the CARES Act removed the 80% absorption limitation previously enacted under the Tax Cuts and Jobs Act of 2017. The income tax aspects of the CARES Act are not expected to have a material impact on the Company’s financial statements.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	3 Months Ended
	Mar. 31, 2021
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 Advisor is owned by Corey R. Maple and Norman H. Leslie. 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, as described in more detail below. 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 Company’s securities offerings, 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 earned and payable to the Advisor and its affiliates, for the three months ended March 31, 2021 and 2020, and amounts outstanding and payable as of March 31, 2021 and December 31, 2020, were as follows: Incurred For the Three Months Ended March 31, 2021 2020 Fees: Acquisition fees $ 330,540 $ 501,949 Financing fees 330,540 501,949 Asset management fees 248,708 197,165 Performance fees — — $ 909,788 $ 1,201,063 Reimbursements: Offering costs $ 338,187 $ 583,926 General and administrative 760,158 813,575 Sales and marketing 44,454 76,153 Acquisition costs 37,931 64,847 Other (income) expense, net — 282 $ 1,180,730 $ 1,538,783 For the three months ended March 31, 2021 and 2020, the Operating Partnership recognized distributions payable to the Advisor in the amount of $71,511 and $60,308, respectively, in connection with the Advisor’s ownership of Series B LP Units. As of March 31, 2021 and December 31, 2020, the Company had distributions payable to the Advisor $399,408 and $399,270, respectively. For the three months ended March 31, 2021 and 2020, the Company paid distributions in the amount of $9,831 and $9,409, respectively, to Corey Maple and Norman Leslie in connection with their ownership of 56,899 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 Common LP 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 were also guarantors of the Company’s $3.0 million line of credit, each in the amount of $1.2 million. That line of credit was closed in November 2020. For the three months ended March 31, 2021, the Company accrued guarantee fees in the amount of $40,189 to each Mr. Maple and Mr. Leslie. The total amount accrued of $391,955 remained unpaid as of March 31, 2021 and is included in due to related parties on the accompanying consolidated balance sheet. Guarantee fees of $69,334 were assessed for three months ended March 31, 2020. As of March 31, 2021 and December 31, 2020, the Company had amounts due and payable to the Advisor and its affiliates of $2,127,634 and $1,720,605, respectively, which is included in due to related parties on the accompanying consolidated balance sheets. 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. NHS also earns a flat fee of $5,000 per hotel property for due diligence services, including analyzing, evaluating, and reporting on documentation and information received by sellers or contributors during the period of due diligence. Such fee is waived if, upon acquisition by us, NHS is selected as the management company for the hotel property. NHS is also reimbursed for actual out-of-pocket costs incurred in providing the due diligence services. Fees and reimbursements earned and payable to, NHS for the three months ended March 31, 2021 and 2020, and amounts outstanding and payable as of March 31, 2021 and December 31, 2020, were as follows: Incurred Payable as of For the Three Months Ended March 31, March 31, December 31, 2021 2020 2021 2020 Fees: Management fees $ 110,055 $ 116,089 $ 53,008 $ 36,509 Administrative fees 29,090 17,863 19,819 5,648 Accounting fees 16,546 20,820 13,648 10,701 $ 155,691 $ 154,772 $ 86,475 $ 52,858 Reimbursements $ 75,924 $ 80,576 $ 44,735 $ 5,530 One Rep Construction, LLC (“One Rep”)— One Rep is a related party through common management and ownership, as Corey Maple, Norman Leslie, and David Ekman, each hold a 33.33% ownership interest in One Rep. One Rep is a construction management company which provided construction management services to the Company during 2021 and 2020 related to the renovation construction activities at certain hotel properties. For the services provided, One Rep is paid a construction management fee equal to 6% of the total project costs. The Company reimburses One Rep for certain costs incurred on behalf of the Company, and all reimbursements are paid to One Rep at cost. For the three months ended March 31, 2021 and the year ended December 31, 2020, the Company incurred $37,034 and $176,669 of construction management fees payable to One Rep, respectively. As of March 31, 2021 and December 31, 2020, the amounts outstanding and due to One Rep were $69,994 and $34,988, respectively, which is included in due to related parties on the accompanying consolidated balance sheets.

FRANCHISE AGREEMENTS

FRANCHISE AGREEMENTS	3 Months Ended
	Mar. 31, 2021
FRANCHISE AGREEMENTS
FRANCHISE AGREEMENTS	8. FRANCHISE AGREEMENTS As of March 31, 2021, 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 4% 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, 2021
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 Interval Common Stock described below do not have voting rights. The rights of the holders of shares of preferred stock may be defined at such time any series of preferred shares are issued. 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 and to set the terms of the Interval Common Stock. Common Stock 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 for the three months ended March 31, 2021 were based on daily record dates and were calculated based on stockholders of record each day during this period at a rate of $0.00191781 per share per day. Distributions for the periods from April 1, 2020 through June 30, 2020 were payable to each stockholder in shares of common stock issued through the DRIP, or at the election of the stockholder, in shares of common stock valued at $10.00 per share. Distributions for the periods from July 1, 2020 through September 30, 2020, October 1, 2020 through December 31, 2020, and January 1, 2021 through March 31, 2021 were payable to each stockholder 30% in cash (or through the DRIP if then currently enrolled in the DRIP) and 70% in shares of common stock issued through the DRIP, or at the election of the stockholder, in shares of common stock valued at $10.00 per share. Going forward, the Company expects the board of directors of the Company to authorize and declare distributions, if at all, based on daily record dates and to pay these distributions on a quarterly basis. Distributions will be determined by the board of directors based on the Company’s financial condition and other factors as the board of directors deems relevant, and may be paid in cash or in shares pursuant to the DRIP. The Company has not established a minimum distribution level, and the charter does not require that the Company make distributions to its stockholders. 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. There were no repurchases during the three months ended March 31, 2021. During the year ended December 31, 2020, the Company repurchased 64,190 shares, which represents an original investment of $641,898, including $16,898 of DRIP shares, for $590,547. As of December 31, 2020, $24,032 of the redemption proceeds had not yet been paid and was included in other liabilities on the accompanying consolidated balance sheets. At March 31, 2021 and December 31, 2020, the Company had $3,695,479 and $208,586, respectively, available for eligible repurchases. Interval Common Stock Distributions Holders 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, distributions at a rate equal to 86% of the distribution rate for the Company’s common stock as authorized by the board of directors and declared by the Company. Distributions 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 distributions 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. Interval Share 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. As of March 31, 2021, the Company had not issued or sold any shares of Interval Common Stock. Non-Controlling Interests The Operating Partnership currently has 4 classes of Limited Partner Units which include the Common Limited Units, the Series B LP Units, the Series T LP Units and the GO Limited Units. The Series B LP Units are issued to the Advisor and entitle the Advisor to receive annual distributions and an incentive distribution based on the net proceeds received from the sale of the Projects (as defined below). Non-Controlling Interest – Series T LP Units The Series T LP Units are expected to be issued to persons who contribute their property interests in certain Projects to the Partnership in exchange for Series T LP Units. The Series T LP Units will have allocations and distributions as determined by the General Partner in its sole discretion at the time of issuance of the Series T LP Units, and any Series T LP Units issued may have different allocations and distributions than other Series T LP Units. The Series T LP Units will be converted into Common Limited Units beginning 36 months after their issuance, and will automatically convert into Common Limited Units upon a Termination Event. As of March 31, 2021, the Company had issued 1,103,758 Series T LP Units. Non-Controlling Interest – Series GO LP Units Distributions The holders of Series GO LP Units will not receive any distributions from the Operating Partnership until after they have held their Series GO LP Units for a period of 18 months. Thereafter, the Series GO Limited Partners will receive the same distributions payable to the holders of the Common LP Units and GP Units (together with the Series GO LP Units and Interval Units, the “Participating Partnership Units”), other than with respect to proceeds received upon the sale or exchange of a property which are not reinvested in additional properties. Upon the sale of all or substantially all of the GP Units held by LF REIT III or any sale, exchange or merger of LF REIT III or the Operating Partnership (each, a “Termination Event”), or with respect to proceeds received upon the sale or exchange of a property which are not reinvested in additional properties, distributions will be made between the Series GO LP Units and the other Participating Partnership Units as follows: (i) first, to the Participating Partnership Units in proportion to their Partnership Units until the GP Units (the Common LP Units and the Interval Units) have received 70% of their original capital contributions (determined on a grossed-up basis) reduced by any prior distributions received in connection with the sale of a property in which the sale proceeds are not reinvested in additional properties; (ii) second, to the Participating Partnership Units in proportion to their Partnership Units until each Participating Partnership Unit has received a Participating Amount ($1.00 for any period after December 31, 2020, $2.00 for any period after December 31, 2021 and $3.00 for any period after December 31, 2022, determined as a singular determination and not a cumulative determination); (iii) third, to the Participating Partnership Units (other than the Series GO LP Units) in proportion to their Partnership Units until the GP Units have received any remaining unreturned original capital contributions; (iv) fourth, to the Series GO Limited Partners in proportion to their Series GO LP Units until the amount distributed to the Series GO Limited Partners per Series GO LP Unit is equal to the amount distributed to the Participating Partnership Units per Participating Partnership Unit (other than the Series GO Limited Partners) pursuant to (iii); and (v) thereafter, to the Participating Partnership Units in proportion to their Participating Partnership Units. GO Unit Offering On June 15, 2020, the Operating Partnership commenced a private offering of limited partnership units in the OP, designated as Series GO LP Units, with a maximum offering of $20,000,000, which may be increased to $30,000,000 in the sole discretion of LF REIT III as the General Partner of the OP, to accredited investors only, pursuant to a confidential private placement memorandum exempt from registration under the Securities Act of 1933, as amended. As of March 31, 2021, the Company had issued and sold 1,258,817 Series GO LP Units and received aggregate proceeds of $8.7 million. Non-Controlling Interest – Series B LP Units Distributions Under the Operating Partnership Agreement, the Advisor, as the Series B Limited Partner, will received from the Operating Partnership, distributions as follows: (a) for all years, an amount equal to 5.0% of the total of (i) the total distributions made to the Partners (other than the Series B Limited Partner) and (ii) the total distributions made to the Series B Limited Partner, after the Partners (other than the Series B Limited Partner) have received a 6.0% cumulative, but not compounded, return on their original capital contributions, and (b) for the year of liquidation or other cessation of the General Partner or the Partnership, an amount equal to 5.0% of the original capital contributions made by the Partners, after the Partners (other than the Series B Limited Partner) have received a return of their capital contributions plus a six percent (6%) cumulative, but not compounded return from all distributions. Series B LP Unit Offering As of March 31, 2021, the Operating Partnership has issued 1,000 Series B LP Units to the Advisor.

COMMITMENTS AND CONTINGENCIES

COMMITMENTS AND CONTINGENCIES	3 Months Ended
	Mar. 31, 2021
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, 2021, 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. In December 2020, the Company received notice that the SEC is conducting an inquiry into the Company’s reimbursement of certain expenses to the Advisor and the Company’s disclosure of the reimbursement policies and procedures. The Company has been and intends to continue cooperating with the inquiry. At this time, the Company is unable to estimate the cost of complying with the inquiry or its outcome. Property Acquisitions The seller of the Pineville Property, 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. As of March 31, 2021, no additional consideration had paid to the seller of the Pineville Property, and no election to receive the additional consideration had been made. In November 2019, the Company entered into a purchase agreement, to acquire 3 hotel properties in Pennsylvania, from a third party group of sellers (collectively, the “PA Sellers”), for $46.9 million plus closing costs, subject to adjustment as provided in the purchase agreement. The Company has deposited a total of $1.5 million into escrow as earnest money (the “Earnest Money”) pending the closing or termination of the purchase agreement. In July 2020, the Company and the PA Sellers exchanged written notices of default with one another in accordance with the terms of the purchase agreement. The notice from each party was based on allegations that the other party failed to perform its obligations under the purchase agreement. On October 27, 2020, the PA Sellers filed a lawsuit against Lodging Fund REIT III OP, LP in the Supreme Court of Pennsylvania alleging breach of the purchase agreement. The PA Sellers seek the full amount of the Earnest Money and recovery of fees and expenses incurred in bringing the lawsuit. The lawsuit is in an early stage and the likelihood of any material loss in connection with the case cannot be determined at this time. As a result, no amount was recorded related to this matter as of March 31, 2021, the Earnest Money remained in escrow and is included in restricted cash on the accompanying consolidated balance sheets. Properties Under Contract On February 17, 2021, the Operating Partnership entered into a Contribution Agreement (the “Houston Contribution Agreement”), pursuant to which the Contributors agreed to contribute the 182-room Hilton Garden Inn Houston Bush Intercontinental Airport hotel in Houston, Texas (the “Houston Property”) to the Operating Partnership. The aggregate contractual consideration for the Houston Property is approximately $20,000,000 plus closing costs, subject to adjustment as provided in the Houston Contribution Agreement. The majority of the consideration consists of the assumption or refinancing by the Operating Partnership of existing debt secured by the Houston Property. The remaining consideration consists of the issuance by the Operating Partnership of Series T LP Units of the Operating Partnership and the payment by the Operating Partnership of cash. As required by the Houston Contribution Agreement, the Operating Partnership has deposited $50,000 into escrow as earnest money pending the closing or termination of the Houston Contribution Agreement. Except in certain circumstances described in the Houston Contribution Agreement, if the Operating Partnership fails to perform its obligations under the Houston Contribution Agreement, it will forfeit the earnest money. See “-Subsequent Events” below for additional information regarding this agreement. On March 8, 2021, the Operating Partnership entered into a Contribution Agreement (the “Corpus Christi Contribution Agreement”), for the contribution of the 88-room Fairfield Inn & Suites Corpus Christi Aransas Pass hotel in Aransas Pass, Texas (the “Corpus Christi Property”) to the Operating Partnership. The aggregate contractual consideration for the Corpus Christi Property is approximately $9,800,000 plus closing costs, subject to adjustment as provided in the Corpus Christi Contribution Agreement. The majority of the consideration consists of the assumption or refinancing by the Operating Partnership of existing debt secured by the Corpus Christi Property. The remaining consideration consists of the issuance by the Operating Partnership of Series T LP Units of the Operating Partnership and the payment by the Operating Partnership of cash. As required by the Corpus Christi Contribution Agreement, the Operating Partnership has deposited $50,000 into escrow as earnest money pending the closing or termination of the Corpus Christi Contribution Agreement. Except in certain circumstances described in the Corpus Christi Contribution Agreement, if the Operating Partnership fails to perform its obligations under the Corpus Christi Contribution Agreement, it will forfeit the earnest money. The Company is still conducting its diligence review with respect to each of these properties. These pending acquisitions are subject to the Company’s completion of satisfactory due diligence and other closing conditions. There can be no assurance the Company will complete any or all of these pending property contributions on the contemplated terms, or at all.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	3 Months Ended
	Mar. 31, 2021
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS	11. SUBSEQUENT EVENTS Distributions Declared or Paid On April 9, 2021, the Company paid distributions totaling $1.4 million, consisting of $0.3 million in cash distributions and $1.1 million of distributions paid in shares of common stock issued through the DRIP, for daily record dates in the period from January 1, 2021 through March 31, 2021. Recent Property Acquisitions On May 12, 2021, the Operating Partnership acquired the Holiday Inn El Paso West Sunland Park hotel property located in El Paso, Texas (the “Holiday Inn El Paso”) pursuant to an Amended and Restated Contribution Agreement (the “El Paso Amended Contribution Agreement”), dated as of the same date. The aggregate contractual consideration under the El Paso Amended Contribution Agreement was approximately $9.7 million plus closing costs, subject to adjustment as provided in the Amended Contribution Agreement. The consideration consists of a new loan entered into by subsidiaries of the Operating Partnership with EPH Development Fund LLC, which is the lender under the existing loan secured by the Holiday Inn El Paso (the “Lender”) of $7.9 million secured by the Holiday Inn El Paso (the “El Paso Loan”), the issuance by the Operating Partnership of 150,000 Series T Limited Units of the Operating Partnership, and the payment by the Operating Partnership of $300,000 in cash. The El Paso Loan is evidenced by a promissory note and has a fixed interest rate of 5.0% per annum. The El Paso Loan matures on May 15, 2023, which may be extended by us until May 15, 2024 upon satisfaction of certain conditions contained in the El Paso Loan, including no then-existing event of default and satisfaction of certain financial covenants. The El Paso Loan requires monthly payments of interest-only throughout the term, with the outstanding principal and interest due at maturity. We have the right to prepay the El Paso Loan in full subject to certain fees, costs and conditions contained in the loan documents. In connection with the acquisition, we assumed the existing management agreement with Elevation Hotel Management, LLC (“EHM”) (as amended, the “EHM Management Agreement”), to provide property management and hotel operations management services for the Holiday Inn El Paso. The EHM Management Agreement has an initial term of 90 days after its effective date. Pursuant to the EHM Management Agreement, we agree to pay to EHM a management fee equal to 3% of total revenues plus an accounting fee of $1,800 per month for accounting services. As a condition to the El Paso Loan, we must enter into a management agreement with NHS, LLC dba National Hospitality Services (“NHS”), an affiliate of the Advisor which is wholly-owned by Norman Leslie, a director and executive officer of the Company and a principal of the Advisor, to act as co-manager of the Holiday Inn El Paso, and amend the EHM Management Agreement such that EHM will act as co-manager of the Holiday Inn El Paso. The Company funded the acquisition of the Holiday Inn El Paso with proceeds from the Company’s ongoing private offering, Series T units issued to the Contributor as described above, and a new loan secured by the Holiday Inn El Paso. The Holiday Inn El Paso is a 175-room hotel property. Properties Under Contract On April 1, 2021, the Operating Partnership entered into an Amended and Restated Contribution Agreement (the “Amended Contribution Agreement”), for the contribution of the 182-room Hilton Garden Inn Houston Bush Intercontinental Airport hotel in Houston, Texas (the “Houston Hilton Garden Inn Property”) to the Operating Partnership. The Amended Contribution Agreement amends and restates that certain Contribution Agreement entered into among the Operating Partnership and the contributors, dated as of February 17, 2021. The aggregate consideration for the Houston Hilton Garden Inn Property under the Amended Contribution Agreement is approximately $19,700,000 plus closing costs, subject to adjustment as provided in the Amended Contribution Agreement. The majority of the consideration consists of the assumption or refinancing by the Operating Partnership of existing debt secured by the Houston Hilton Garden Inn Property. The remaining consideration consists of the issuance by the Operating Partnership of Series T Limited Units of the Operating Partnership. Pursuant to the Amended Contribution Agreement, the Operating Partnership is responsible for up to $300,000 of certain closing costs to be agreed upon by the parties. As required by the Amended Contribution Agreement, the Operating Partnership has deposited $50,000 into escrow as earnest money pending the closing or termination of the Amended Contribution Agreement. Except in certain circumstances described in the Amended Contribution Agreement, if the Operating Partnership fails to perform its obligations under the Amended Contribution Agreement, it will forfeit the earnest money. This pending acquisition is subject to the Company’s completion of satisfactory due diligence and other closing conditions, including the Operating Partnership’s assumption or refinancing of the existing debt secured by the Houston Hilton Garden Inn Property. There can be no assurance that the Operating Partnership will complete the acquisition of the Houston Hilton Garden Inn Property. Amendment of $5.0 million Line of Credit On May 6, 2021, the Company amended its $5.0 million revolving line of credit to extend the maturity date to May 10, 2022 and to incorporate an interest rate floor of 4.0%. Status of the Offering As of May 17, 2021, the Company’s private offering remained open for new investment, and since the inception of the offering the Company had issued and sold 8,006,215 shares of common stock, including 622,904 shares issued pursuant to the DRIP, resulting in the receipt of gross offering proceeds of $77.8 million. Status of the GO Unit Offering As of May 17, 2021, the Company’s GO Unit Offering remained open for new investment, and since the inception of the offering the Company had issued and sold 1,390,615 Series GO LP Units, resulting in the receipt of gross GO Unit Offering proceeds of $9.6 million. ******

SUMMARY OF SIGNIFICANT ACCOUN_2

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)	3 Months Ended
	Mar. 31, 2021
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, 2021 are not necessarily indicative of the results that may be expected for the year ending December 31, 2021. 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. 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 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. Although the Company’s hotel properties have remained open through the pandemic in 2020 and 2021, the Company’s occupancy levels have been lower than historic levels. The outbreak could have a continued adverse impact on economic and market conditions and could trigger a continued slowdown in leisure and business travel, which is adversely impacting the travel and hospitality industries. The 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, 2021, 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, 2021 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. 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, including the impact of COVID-19, 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.
Advertising Costs	Advertising Costs – The Company expenses advertising costs as incurred. These costs represent the expense for franchise advertising and reservation systems under the terms of the hotel management and franchise agreements and expenses that are directly attributable to advertising and promotion. Advertising expense was $136,995 and $169,959 for the three months ended March 31, 2021 and 2020, respectively, and is included in sales and marketing in the consolidated statement of operations.
Non-controlling Interest	Non-controlling Interest —Non-controlling interests represent the portion of equity related to shares with limited voting interest. 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, 2021 and December 31, 2020, restricted cash on the accompanying consolidated balance sheets included $1.8 million and $1.85 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 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, 2021 and 2020, 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. 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 fiscal year ending December 31, 2022, and for interim periods beginning on January 1, 2022. 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, 2021
INVESTMENT IN HOTEL PROPERTIES
Schedule of investment in hotel properties	March 31, December 31, 2021 2020 Land and land improvements $ 14,730,590 $ 10,324,772 Building and building improvements 103,262,396 85,213,846 Furniture, fixtures, and equipment 10,721,289 8,927,694 Construction in progress 1,086,171 990,452 Investment in hotel properties, at cost 129,800,446 105,456,764 Less: accumulated depreciation (5,715,332) (4,712,578) Investment in hotel properties, net $ 124,085,114 $ 100,744,186
Schedule of acquisitions of hotel properties	2021 Acquisitions Number Date of Guest Purchase Transaction % Hotel Property Type Location Acquired Rooms Price Costs Total Interest Courtyard by Marriott Select Service Aurora, CO February 4, 2021 141 $ 23,610,000 (1) $ 458,129 $ 24,068,129 100 % 141 $ 23,610,000 $ 458,129 $ 24,068,129 (1) Includes the issuance of 1,103,758 Series T LP Units of the Operating Partnership The table below outlines the details of the properties acquired during the year ended December 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
Schedule of aggregate purchase price for the hotel properties	March 31, December 31, 2021 2020 Land and land improvements $ 4,400,098 $ 2,576,166 Building and building improvements 18,048,551 31,605,174 Furniture, fixtures, and equipment 1,619,480 3,007,846 Total assets acquired 24,068,129 37,189,186 Premium on assumed debt — (597,665) Total liabilities assumed — (597,665) Total purchase price (1) 24,068,129 36,591,521 Assumed mortgage debt — 9,400,772 Net purchase price $ 24,068,129 $ 27,190,749 Total purchase price includes purchase price plus all transaction costs.

DEBT - (Tables)

DEBT - (Tables)	3 Months Ended
	Mar. 31, 2021
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 2021 Date 2021 2020 Holiday Inn Express - Cedar Rapids (1) 5.33% 09/01/2024 $ 5,858,134 $ 5,858,134 Hampton Inn & Suites - Pineville 5.13% 06/06/2024 8,925,255 8,973,775 Hampton Inn - Eagan 4.60% 01/01/2025 9,317,589 9,317,589 Home2 Suites - Prattville (1) 4.13% 08/01/2024 9,591,110 9,647,085 Home2 Suites - Lubbock 4.69% 10/06/2026 7,737,573 7,792,602 Fairfield Inn & Suites - Lubbock 4.93% 04/06/2029 9,235,247 9,272,870 Homewood Suites - Southaven (1) 3.70% 03/03/2025 13,586,110 13,586,110 Courtyard by Marriott - Aurora 7.00% 02/05/2024 15,000,000 — Total Mortgage Debt 79,251,018 64,448,165 Premium on assumed debt, net 821,922 854,928 Deferred financing costs, net (1,614,013) (1,378,374) Net Mortgage 78,458,927 63,924,719 $3.0 million line of credit (2) — 11/22/2020 — — $5.0 million line of credit 3.75% (3) 5/10/2022 — — Total Lines of Credit — — PPP Loans 1.00% Various (4) 801,800 763,100 Debt, net $ 79,260,727 $ 64,687,819 (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) Loan was not renewed at maturity. (3) Variable interest rate equal to U.S. Prime Rate plus 0.50%. One May 6, 2021, the loan was amended to incorporate an interest rate floor of 4.0% (4) Each of the currently outstanding PPP loans has a five year term. All six PPP loans which were outstanding as of December 31, 2020 were forgiven in February 2021.
Schedule of future minimum principal payments	2021 $ 861,353 2022 1,544,938 2023 1,737,149 2024 39,242,552 2025 21,579,995 Thereafter 15,086,831 80,052,818 Premium on assumed debt, net 821,922 Deferred financing costs, net (1,614,013) $ 79,260,727

RELATED PARTY TRANSACTIONS (Tab

RELATED PARTY TRANSACTIONS (Tables)	3 Months Ended
	Mar. 31, 2021
Advisor And Affiliates
Related Party Transactions
Schedule of fees and reimbursements incurred and payable	Incurred For the Three Months Ended March 31, 2021 2020 Fees: Acquisition fees $ 330,540 $ 501,949 Financing fees 330,540 501,949 Asset management fees 248,708 197,165 Performance fees — — $ 909,788 $ 1,201,063 Reimbursements: Offering costs $ 338,187 $ 583,926 General and administrative 760,158 813,575 Sales and marketing 44,454 76,153 Acquisition costs 37,931 64,847 Other (income) expense, net — 282 $ 1,180,730 $ 1,538,783
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, 2021 2020 2021 2020 Fees: Management fees $ 110,055 $ 116,089 $ 53,008 $ 36,509 Administrative fees 29,090 17,863 19,819 5,648 Accounting fees 16,546 20,820 13,648 10,701 $ 155,691 $ 154,772 $ 86,475 $ 52,858 Reimbursements $ 75,924 $ 80,576 $ 44,735 $ 5,530

ORGANIZATION - (Details)

ORGANIZATION - (Details)	3 Months Ended		12 Months Ended
	Mar. 31, 2021USD ($)segmentitem$ / sharesshares	Mar. 31, 2020USD ($)	Dec. 31, 2020USD ($)$ / sharesshares	Jun. 15, 2020USD ($)	Apr. 29, 2020USD ($)$ / sharesshares	Jun. 01, 2018USD ($)$ / shares
Organization
Number of reportable segments | segment	1
Number of voting classes of partnership units | item	3
Number of non voting classes of partnership units | item	3
Common stock, par value (in dollars per share) | $ / shares	$ 0.01		$ 0.01
Common stock, shares authorized | shares	900,000,000		900,000,000
Stock repurchased, original investment			$ 641,898
Value of stock repurchased		$ 92,000	$ 590,547
Number of shares repurchased | shares	0		64,190
Accrued share repurchases	$ 0
Proceeds from issuance of units	$ 4,201,300
Other Liabilities
Organization
Accrued share repurchases			$ 24,032
DRIP
Organization
Value of stock repurchased			$ 16,898
Interval Common Stock
Organization
Common stock, par value (in dollars per share) | $ / shares					$ 0.01
Number of shares of common stock designated as non-voting shares of Interval Common Stock | shares					7,000,000
Private offering
Organization
Common stock, par value (in dollars per share) | $ / shares						$ 0.01
Maximum offering						$ 100,000,000
Cumulative number of shares issued | shares	7,872,134
Cumulative number of shares issued pursuant to the DRIP | shares	506,688
Cumulative gross proceeds from issuance of stock	$ 76,600,000
Private offering | Interval Common Stock
Organization
Common stock, par value (in dollars per share) | $ / shares					$ 0.01
Number of shares of common stock designated as non-voting shares of Interval Common Stock | shares					7,000,000
Maximum offering					$ 30,000,000
Maximum offering per the sole discretion of the Company's board of directors					$ 60,000,000
Series GO LP Units | Private offering
Organization
Maximum offering				$ 20,000,000
Maximum offering per the sole discretion of the General Partner				$ 30,000,000
Cumulative number of units issued since inception of the Offering | shares	1,258,817
Cumulative gross proceeds from issuance of units since inception of the Offering	$ 8,700,000
Operating Partnership | Common LP Units
Organization
Number of outstanding partnership units | shares	0		0
Operating Partnership | Series B Limited Partnership Units
Organization
Number of outstanding partnership units | shares	1,000		1,000
Operating Partnership | Series T LP Units
Organization
Number of outstanding partnership units | shares	1,103,758		0
Operating Partnership | Series GO LP Units
Organization
Number of outstanding partnership units | shares	1,258,817		654,868

SUMMARY OF SIGNIFICANT ACCOUN_3

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Advertising Costs
Advertising Expense	$ 136,995	$ 169,959
Management Fees
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	$ 1,800,000		$ 1,850,000
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, 2021USD ($)statepropertyroom	Dec. 31, 2020USD ($)
Investment in hotel properties consisted of the following:
Land and land improvements	$ 14,730,590	$ 10,324,772
Building and building improvements	103,262,396	85,213,846
Furniture, fixtures, and equipment	10,721,289	8,927,694
Construction in progress	1,086,171	990,452
Investment in hotel properties, at cost	129,800,446	105,456,764
Less: accumulated depreciation	(5,715,332)	(4,712,578)
Investment in hotel properties, net	$ 124,085,114	$ 100,744,186
Other disclosures
Number of hotel properties owned | property	8
Aggregate number of rooms in hotel properties | room	847
Number of states where hotel properties are owned | state	7

INVESTMENT IN HOTEL PROPERTIE_3

INVESTMENT IN HOTEL PROPERTIES - Acquisitions (Details)	Feb. 04, 2021USD ($)roomshares	Feb. 21, 2020USD ($)room	Jan. 08, 2020USD ($)room	Mar. 31, 2021USD ($)propertyroom	Dec. 31, 2020USD ($)propertyroom
Acquisitions
Number of rooms | room				141	200
Purchase Price				$ 23,610,000	$ 35,650,000
Transaction costs				458,129	941,521
Total				24,068,129	36,591,521
Other disclosures
Total Cost				$ 124,085,114	$ 100,744,186
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%
Courtyard by Marriott (the Aurora Property) [Member]
Acquisitions
Number of rooms | room	141
Purchase Price	$ 23,610,000
Transaction costs	458,129
Total	$ 24,068,129
Interest (as a percent)	100.00%
Courtyard by Marriott (the Aurora Property) [Member] | Series T LP Units
Other disclosures
Consideration (in shares) | shares	1,103,758
Asset Acquisitions 2021
Other disclosures
Number of properties acquired | property				1
Asset Acquisitions 2020
Other disclosures
Number of properties acquired | property					2
Aurora Hotel Properties
Other disclosures
Total Cost	$ 23,600,000
Aurora Hotel Properties | Series T LP Units
Other disclosures
Consideration (in shares) | shares	1,103,758
Aurora Hotel Properties | Series T LP Units | Minimum
Other disclosures
Time period for conversion of units	36 months
Aurora Hotel Properties | Series T LP Units | Maximum
Other disclosures
Time period for conversion of units	48 months

INVESTMENT IN HOTEL PROPERTIE_4

INVESTMENT IN HOTEL PROPERTIES - Purchase Price Allocation (Details) - Nonrecurring - USD ($)	Mar. 31, 2021	Dec. 31, 2020
2021 Acquisitions
INVESTMENT IN HOTEL PROPERTIES
Land and land improvements	$ 4,400,098
Building and building improvements	18,048,551
Furniture, fixtures, and equipment	1,619,480
Total assets acquired	24,068,129
Total purchase price	24,068,129
Net purchase price	$ 24,068,129
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

DEBT - Lines of Credit (Details

DEBT - Lines of Credit (Details) - Revolving line of credit - USD ($)	Aug. 22, 2018	Mar. 31, 2021	Dec. 31, 2020	Feb. 10, 2020
Lender One
Debt
Revolving line of credit	$ 3,000,000	$ 3,000,000	$ 3,000,000
Partnership units pledged	300,000
Lender One | Corey Maple
Debt
Line of credit guarantee amount		1,200,000
Line of credit, guarantee amount		1,200,000
Lender One | Norman Leslie
Debt
Line of credit guarantee amount		1,200,000
Line of credit, guarantee amount		1,200,000
Lender One | Minimum
Debt
Variable interest rate (as a percent)	5.00%
Lender One | U.S. Prime Rate
Debt
Basis spread (as a percent)	1.00%
Lender Three
Debt
Revolving line of credit		$ 5,000,000		$ 5,000,000
Partnership units pledged				100,000
Variable interest rate (as a percent)		3.75%
Outstanding amount		$ 0
Interest rate (as a percent)		4.00%
Lender Three | U.S. Prime Rate
Debt
Basis spread (as a percent)		0.50%

DEBT - Mortgage Debt and Loans

DEBT - Mortgage Debt and Loans (Details)

Oct. 02, 2020loan

Sep. 25, 2020loan

Feb. 28, 2021USD ($)loan

Jan. 31, 2021USD ($)loan

Apr. 30, 2020USD ($)loan

Mar. 31, 2021USD ($)propertyloan

Dec. 31, 2020USD ($)

Jul. 31, 2020USD ($)

Mar. 31, 2020USD ($)

Feb. 21, 2020USD ($)

Jul. 11, 2019USD ($)

Jun. 19, 2019USD ($)

Mar. 05, 2019USD ($)

Debt

Outstanding balance

$ 80,052,818

Mortgage Debt

Debt

Number of properties as security for mortgage debt | property

8

Weighted-average interest rate (as a percent)

4.54%

Number of variable interest rate loans | loan

1

Number of fixed interest rate loans | loan

7

Effective interest rate

7.00%

Outstanding balance

$ 79,251,018

$ 64,448,165

Mortgage Debt | Minimum

Debt

Fixed interest rate (as a percent)

3.70%

Mortgage Debt | Maximum

Debt

Fixed interest rate (as a percent)

5.33%

Mortgage Debt | LIBOR

Debt

Basis spread (as a percent)

6.00%

Mortgage Debt | LIBOR | Minimum

Debt

Basis spread (as a percent)

1.00%

PPP Loans

Debt

Principal amount

$ 716,400

Term of loan

5 years

5 years

Interest rate (as a percent)

1.00%

1.00%

1.00%

Interest deferral period

16 months

Number of PPP loans cover period ended | loan

4

2

Number of unsecured promissory notes | loan

6

6

Outstanding balance

$ 763,100

$ 801,800

763,100

Percentage of loan forgiven

100.00%

Number of loans forgiven | loan

6

PPP Loans | Minimum

Debt

Term of loan

2 years

PPP Loans | Maximum

Debt

Term of loan

5 years

Southaven TRS | PPP Loans

Debt

Principal amount

$ 85,400

Term of loan

5 years

Interest rate (as a percent)

1.00%

Interest deferral period

16 months

Holiday Inn Express (the "Cedar Rapids Property") | Mortgage Debt

Debt

Principal amount

$ 5,900,000

Interest rate (as a percent)

5.33%

Outstanding balance

$ 5,858,134

5,858,134

Hampton Inn (the "Eagan Property") | Mortgage Debt

Debt

Principal amount

$ 9,400,000

Interest rate (as a percent)

4.60%

Outstanding balance

$ 9,317,589

9,317,589

Home2 Suites (the "Prattville Property")

Debt

Principal amount

$ 9,600,000

Home2 Suites (the "Prattville Property") | Mortgage Debt

Debt

Principal amount

$ 9,600,000

Accrued interest paid-in-kind

$ 100,878

Minimum cash balance required during forbearance period

155,000

Cash balance held by borrower subsidiary entities

831,379

Interest rate (as a percent)

4.13%

Outstanding balance

$ 9,591,110

9,647,085

Homewood Suites (the "Southaven Property")

Debt

Principal amount

$ 13,500,000

Homewood Suites (the "Southaven Property") | Mortgage Debt

Debt

Principal amount

$ 13,500,000

Accrued interest paid-in-kind

$ 126,110

Minimum cash balance required during forbearance period

225,000

Cash balance held by borrower subsidiary entities

1,498,889

Interest rate (as a percent)

3.70%

Outstanding balance

$ 13,586,110

$ 13,586,110

DEBT - Summary of Debt (Details

DEBT - Summary of Debt (Details)	Aug. 22, 2018USD ($)	Mar. 31, 2021USD ($)	Feb. 28, 2021loan	Jan. 31, 2021	Dec. 31, 2020USD ($)	Apr. 30, 2020USD ($)	Mar. 31, 2020USD ($)	Feb. 10, 2020USD ($)
Outstanding Debt:
Outstanding balance							$ 80,052,818
Premium on assumed debt, net		$ 821,922			$ 854,928		821,922
Deferred financing costs, net		(1,614,013)			(1,378,374)		(1,614,013)
Debt, net		79,260,727			64,687,819		$ 79,260,727
Lender One | Revolving line of credit
Outstanding Debt:
Line of credit	$ 3,000,000	3,000,000			3,000,000
Lender One | Revolving line of credit | Minimum
Outstanding Debt:
Interest rate (as a percent)	5.00%
Lender One | Revolving line of credit | U.S. Prime Rate
Outstanding Debt:
Basis spread (as a percent)	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%
Lender Three | Revolving line of credit | U.S. Prime Rate
Outstanding Debt:
Basis spread (as a percent)		0.50%
Mortgage Debt
Outstanding Debt:
Outstanding balance		$ 79,251,018			64,448,165
Debt, net		$ 78,458,927			63,924,719
PPP Loans
Outstanding Debt:
Interest rate (as a percent)		1.00%		1.00%		1.00%
Outstanding balance		$ 801,800			763,100	$ 763,100
Number of loans forgiven | loan			6
Holiday Inn Express (the "Cedar Rapids Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		5.33%
Outstanding balance		$ 5,858,134			5,858,134
Hampton Inn & Suites(the "Pineville Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		5.13%
Outstanding balance		$ 8,925,255			8,973,775
Hampton Inn (the "Eagan Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.60%
Outstanding balance		$ 9,317,589			9,317,589
Home2 Suites (the "Prattville Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.13%
Outstanding balance		$ 9,591,110			9,647,085
Home2 Suites (the “Lubbock Home2 Property”) | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.69%
Outstanding balance		$ 7,737,573			7,792,602
Fairfield Inn & Suites - Lubbock | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		4.93%
Outstanding balance		$ 9,235,247			9,272,870
Homewood Suites (the "Southaven Property") | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		3.70%
Outstanding balance		$ 13,586,110			$ 13,586,110
Courtyard by Marriott - Aurora | Mortgage Debt
Outstanding Debt:
Interest rate (as a percent)		7.00%
Outstanding balance		$ 15,000,000

DEBT - Future Minimum Payments

DEBT - Future Minimum Payments (Details) - USD ($)	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Future minimum payments
2021			$ 861,353
2022			1,544,938
2023			1,737,149
2024			39,242,552
2025			21,579,995
Thereafter			15,086,831
Total			80,052,818
Premium on assumed debt, net	$ 821,922	$ 854,928	821,922
Deferred financing costs, net	(1,614,013)	(1,378,374)	(1,614,013)
Debt, net	$ 79,260,727	$ 64,687,819	$ 79,260,727

FAIR VALUE OF FINANCIAL INSTR_2

FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($)	Mar. 31, 2021	Dec. 31, 2020	Mar. 31, 2020
Fair value of financial instruments
Debt			$ 80,052,818
Mortgage Debt
Fair value of financial instruments
Fair value	$ 83,400,000	$ 67,500,000
Debt	$ 79,251,018	$ 64,448,165

INCOME TAXES - Narrative (Detai

INCOME TAXES - Narrative (Details) - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020	Sep. 30, 2020	Jun. 30, 2020
INCOME TAXES
Income taxes paid	$ 0	$ 0
Net deferred tax assets			$ 1,466,942
Deferred tax asset valuation allowance				$ 600,901	$ 1,100,000

RELATED PARTY TRANSACTIONS - Na

RELATED PARTY TRANSACTIONS - Narratives (Details)	3 Months Ended
	Mar. 31, 2021USD ($)$ / property$ / roomshares	Mar. 31, 2020USD ($)	Dec. 31, 2020USD ($)shares	Feb. 20, 2020shares	Feb. 10, 2020USD ($)	Aug. 22, 2018USD ($)
Related Party Transactions
Distributions Paid	$ 246,084	$ 691,604
Accrued guarantee fees	391,955
Loan guarantee fees		69,334
Reimbursements payable	$ 2,432,640		$ 1,904,051
Advisor And Affiliates
Related Party Transactions
Guarantee fees (as a percent)	1.00%
Reimbursements payable	$ 2,127,634		1,720,605
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%
Flat fee per property | $ / property	5,000
Corey Maple
Related Party Transactions
Accrued guarantee fees	$ 40,189
Corey Maple | One Rep Construction, LLC
Related Party Transactions
Ownership interest by related party (as a percent)	33.33%
Norman Leslie
Related Party Transactions
Accrued guarantee fees	$ 40,189
Norman Leslie | One Rep Construction, LLC
Related Party Transactions
Ownership interest by related party (as a percent)	33.33%
One Rep Construction, LLC
Related Party Transactions
Reimbursements payable	$ 69,994		34,988
Construction management fee (as a percent)	6.00%
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	$ 71,511	60,308
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	$ 399,408		$ 399,270
Advisory Agreement | Legendary Capital REIT III, LLC | Corey Maple
Related Party Transactions
Distributions Paid	$ 9,831
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
Number of shares held by shareholders | shares	56,899		56,899

RELATED PARTY TRANSACTIONS - Le

RELATED PARTY TRANSACTIONS - Legendary Capital (Details) - Advisor And Affiliates - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020
Related Party Transactions
Fees incurred	$ 909,788	$ 1,201,063
Reimbursements incurred	1,180,730	1,538,783
Acquisition Fees
Related Party Transactions
Fees incurred	330,540	501,949
Financing Fees
Related Party Transactions
Fees incurred	330,540	501,949
Asset Management Fees
Related Party Transactions
Fees incurred	248,708	197,165
Offering Costs
Related Party Transactions
Reimbursements incurred	338,187	583,926
General and Administrative
Related Party Transactions
Reimbursements incurred	760,158	813,575
Sales and Marketing
Related Party Transactions
Reimbursements incurred	44,454	76,153
Acquisition Costs
Related Party Transactions
Reimbursements incurred	$ 37,931	64,847
Other (income) expense, net
Related Party Transactions
Reimbursements incurred		$ 282

RELATED PARTY TRANSACTIONS - NH

RELATED PARTY TRANSACTIONS - NHS (Details) - NHS - USD ($)	3 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Related Party Transactions
Fees incurred	$ 155,691	$ 154,772
Fees payable	86,475		$ 52,858
Reimbursements incurred	75,924	80,576
Reimbursements payable	44,735		5,530
Management Fees
Related Party Transactions
Fees incurred	110,055	116,089
Fees payable	53,008		36,509
Administrative Fees
Related Party Transactions
Fees incurred	29,090	17,863
Fees payable	19,819		5,648
Accounting Fees
Related Party Transactions
Fees incurred	16,546	$ 20,820
Fees payable	$ 13,648		$ 10,701

RELATED PARTY TRANSACTIONS - On

RELATED PARTY TRANSACTIONS - One Rep Construction, LLC (Details) - USD ($)	Mar. 31, 2021	Dec. 31, 2020
One Rep Construction, LLC | Construction Management fees
Related Party Transactions
Fees payable	$ 37,034	$ 176,669

FRANCHISE AGREEMENTS - (Details

FRANCHISE AGREEMENTS - (Details)	3 Months Ended
	Mar. 31, 2021USD ($)
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)	4.00%
Program fee (as a percent)	3.00%
Initial franchise fee	$ 50,000

STOCKHOLDERS' EQUITY - Common S

STOCKHOLDERS' EQUITY - Common Stock (Details)	3 Months Ended
	Mar. 31, 2021Vote$ / sharesshares	Dec. 31, 2020$ / sharesshares	Sep. 30, 2020$ / shares	Jun. 30, 2020$ / shares	May 14, 2020$ / shares	Apr. 29, 2020USD ($)$ / 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
Common stock, offering price	$ 10	$ 10	$ 10	$ 10
Percentage of current share net asset value	95.00%
Interval Common Stock
Stockholders' Equity
Common stock, par value (in dollars per share)						$ 0.01
Number of shares of common stock designated as non-voting shares of Interval Common Stock | shares						7,000,000
Private offering
Stockholders' Equity
Common stock, par value (in dollars per share)							$ 0.01
Common stock, offering price							$ 10
Maximum offering | $							$ 100,000,000
Private offering | Interval Common Stock
Stockholders' Equity
Common stock, par value (in dollars per share)						$ 0.01
Common stock, offering price					$ 10
Maximum offering | $						$ 30,000,000
Number of shares of common stock designated as non-voting shares of Interval Common Stock | shares						7,000,000

STOCKHOLDERS' EQUITY - Distribu

STOCKHOLDERS' EQUITY - Distributions (Details) - $ / shares	3 Months Ended			12 Months Ended
	Mar. 31, 2021	Dec. 31, 2020	Sep. 30, 2020	Dec. 31, 2020	Jun. 30, 2020
STOCKHOLDERS' EQUITY
Common stock dividends per share declared on daily rate basis				$ 0.00191781
Share price (in dollars per share)	$ 10	$ 10	$ 10	$ 10	$ 10
Percentage of distribution in cash or through DRIP	30.00%	30.00%	30.00%
Percentage of distribution in shares of common stock issued through DRIP	70.00%	70.00%	70.00%

STOCKHOLDERS' EQUITY - Share Re

STOCKHOLDERS' EQUITY - Share Repurchase Program (Details) - USD ($)	3 Months Ended		12 Months Ended
	Mar. 31, 2021	Mar. 31, 2020	Dec. 31, 2020
Stockholders' Equity
Number of shares repurchased	0		64,190
Stock repurchased, original investment			$ 641,898
Value of stock repurchased		$ 92,000	590,547
Accrued Share Repurchases	$ 0
Share repurchase plan, amount available for eligible repurchases	$ 3,695,479		208,586
Other Liabilities
Stockholders' Equity
Accrued Share Repurchases			24,032
DRIP
Stockholders' Equity
Value of stock repurchased			$ 16,898

STOCKHOLDERS' EQUITY - Interval

STOCKHOLDERS' EQUITY - Interval Common Stock (Details)	Apr. 29, 2020	Mar. 31, 2021$ / shares	Dec. 31, 2020$ / shares	Sep. 30, 2020$ / shares	Jun. 30, 2020$ / shares	May 14, 2020$ / sharesshares	Jun. 01, 2018$ / shares
Stockholders' Equity
Common stock, offering price		$ 10	$ 10	$ 10	$ 10
Repurchase Plan
Stockholders' Equity
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
Repurchase Plan | Last day of same calendar quarter preceding year
Stockholders' Equity
Percentage of Aggregate Value of Interval Shares to be repurchased, threshold	5.00%
Repurchase Plan | Last day of preceding calendar quarter
Stockholders' Equity
Percentage of Aggregate Value of Interval Shares to be repurchased, threshold	5.00%
Interval Common Stock
Stockholders' Equity
Dividend rate (as a percent)	86.00%
Share price, dividend reinvestment plan (in dollars per share)						9.50
Private offering
Stockholders' Equity
Common stock, offering price							$ 10
Private offering | Interval Common Stock
Stockholders' Equity
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
Common stock, offering price						$ 10

STOCKHOLDERS' EQUITY - Noncontr

STOCKHOLDERS' EQUITY - Noncontrolling Interests (Details) - USD ($)	3 Months Ended
	Mar. 31, 2021	Dec. 31, 2020	Jun. 15, 2020	Jun. 01, 2018
Series GO LP Units
Stockholders' Equity
Non-voting partnership units, holding period required before distributions will be paid	18 months
Specified percentage of original GP unit capital contributions	70.00%
Participating amount, any period after December 31, 2020	$ 1
Participating amount, any period after December 31, 2021	2
Participating amount, any period after December 31, 2022	$ 3
Series B LP Units
Stockholders' Equity
Distributions (as a percent)	5.00%
Cumulative return (as a percent)	6.00%
Percentage of original contributions (as percent)	5.00%
Operating Partnership | Series GO LP Units
Stockholders' Equity
Number of outstanding partnership units	1,258,817	654,868
Operating Partnership | Series T LP Units
Stockholders' Equity
Number of outstanding partnership units	1,103,758	0
Operating Partnership | Series B Limited Partnership Units
Stockholders' Equity
Number of outstanding partnership units	1,000	1,000
Private offering
Stockholders' Equity
Maximum offering				$ 100,000,000
Private offering | Series GO LP Units
Stockholders' Equity
Maximum offering			$ 20,000,000
Maximum offering per the sole discretion of the General Partner			$ 30,000,000
Cumulative number of units issued since inception of the Offering	1,258,817
Cumulative gross proceeds from issuance of units since inception of the Offering	$ 8,700,000

COMMITMENTS AND CONTINGENCIES (

COMMITMENTS AND CONTINGENCIES (Details)	Mar. 08, 2021USD ($)	Feb. 17, 2021USD ($)room	Nov. 30, 2019USD ($)property	Mar. 31, 2021USD ($)room	Dec. 31, 2020USD ($)room
COMMITMENTS AND CONTINGENCIES
Number of rooms | room				141	200
Purchase Price				$ 23,610,000	$ 35,650,000
Hampton Inn & Suites(the "Pineville Property")
COMMITMENTS AND CONTINGENCIES
Real estate acquisition, additional consideration				$ 0
Houston Contribution Agreement | Houston Property
COMMITMENTS AND CONTINGENCIES
Number of rooms | room		182
Purchase Price		$ 20,000,000
Escrow Deposit		$ 50,000
Corpus Christi Contribution Agreement | Corpus Christi Property
COMMITMENTS AND CONTINGENCIES
Number of rooms	88
Purchase Price	$ 9,800,000
Escrow Deposit	$ 50,000
Commitment to Purchase Hotel Properties | Pennsylvania Hotel Properties
COMMITMENTS AND CONTINGENCIES
Escrow Deposit			$ 1,500,000
Number of real estate properties to be acquired | property			3
Contractual purchase price			$ 46,900,000

SUBSEQUENT EVENTS - (Details)

SUBSEQUENT EVENTS - (Details)	May 12, 2021USD ($)room	Apr. 09, 2021USD ($)	Apr. 01, 2021USD ($)room	Mar. 31, 2021USD ($)roomshares	Mar. 31, 2020USD ($)	Dec. 31, 2020USD ($)room	May 17, 2021USD ($)shares	Jan. 31, 2021	Apr. 30, 2020
Subsequent Events
Distributions paid in cash				$ 1,430,216	$ 1,204,910
Number of rooms | room				141		200
Aggregate consideration				$ 23,610,000		$ 35,650,000
Transaction costs				$ 458,129		$ 941,521
Private offering
Subsequent Events
Cumulative number of shares issued since inception of the Offering | shares				7,872,134
Cumulative number of shares issued pursuant to the DRIP | shares				506,688
Cumulative gross proceeds from issuance of stock since inception of the Offering				$ 76,600,000
Private offering | Series GO LP Units
Subsequent Events
Cumulative number of units issued since inception of the Offering | shares				1,258,817
Cumulative gross proceeds from issuance of units since inception of the Offering				$ 8,700,000
PPP Loans
Subsequent Events
Interest rate (as a percent)				1.00%				1.00%	1.00%
Subsequent Event
Subsequent Events
Aggregate distributions paid		$ 1,400,000
Distributions paid in cash		300,000
Distributions paid pursuant to the DRIP		$ 1,100,000
Subsequent Event | Private offering
Subsequent Events
Cumulative number of shares issued since inception of the Offering | shares							8,006,215
Cumulative number of shares issued pursuant to the DRIP | shares							622,904
Cumulative gross proceeds from issuance of stock since inception of the Offering							$ 77,800,000
Subsequent Event | GO Unit Offering | Series GO LP Units
Subsequent Events
Cumulative number of units issued since inception of the Offering | shares							1,390,615
Cumulative gross proceeds from issuance of units since inception of the Offering							$ 9,600,000
Subsequent Event | Holiday Inn El Paso | El Paso Contribution Agreement
Subsequent Events
Number of rooms | room	175
Aggregate consideration	$ 9,700,000
Debt incurred	7,900,000
Cash consideration	$ 300,000
Initial term of management agreement	90 days
Management fee expressed as a percentage of revenue	3.00%
Monthly accounting fee per the management agreement	$ 1,800
Subsequent Event | Holiday Inn El Paso | Series T LP Units | El Paso Contribution Agreement
Subsequent Events
Units issued as consideration	$ 150,000
Subsequent Event | Hilton Garden Inn Houston Bush Intercontinental Airport Hotel | Amended Contribution Agreement
Subsequent Events
Number of rooms | room			182
Aggregate consideration			$ 19,700,000
Transaction costs			300,000
Escrow Deposit			$ 50,000
Subsequent Event | Mortgage Debt | Holiday Inn El Paso | El Paso Contribution Agreement
Subsequent Events
Interest rate (as a percent)	5.00%