Document And Entity Information
Document And Entity Information - USD ($) | 12 Months Ended | ||
Jun. 30, 2019 | Aug. 30, 2019 | Dec. 31, 2018 | |
Document And Entity Information [Abstract] | |||
Document Type | 10-K | ||
Amendment Flag | false | ||
Document Period End Date | Jun. 30, 2019 | ||
Document Fiscal Year Focus | 2019 | ||
Document Fiscal Period Focus | FY | ||
Entity Registrant Name | INTERGROUP CORP | ||
Entity Central Index Key | 0000069422 | ||
Current Fiscal Year End Date | --06-30 | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Small Business | true | ||
Entity Emerging Growth Company | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 26,115,000 | ||
Trading Symbol | INTG | ||
Entity Common Stock, Shares Outstanding | 2,309,962 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
ASSETS | ||
Investment in Hotel, net | $ 39,836,000 | $ 40,961,000 |
Investment in real estate, net | 51,773,000 | 53,369,000 |
Investment in marketable securities | 9,696,000 | 13,841,000 |
Other investments, net | 612,000 | 813,000 |
Cash and cash equivalents | 11,837,000 | 8,053,000 |
Restricted cash | 13,295,000 | 9,458,000 |
Other assets, net | 2,362,000 | 5,185,000 |
Deferred tax asset | 1,468,000 | 0 |
Total assets | 130,879,000 | 131,680,000 |
Liabilities: | ||
Accounts payable and other liabilities | 3,819,000 | 3,299,000 |
Accounts payable and other liabilities - Hotel | 11,245,000 | 9,946,000 |
Due to securities broker | 1,629,000 | 1,887,000 |
Obligations for securities sold | 1,225,000 | 1,935,000 |
Related party and other notes payable | 5,261,000 | 5,735,000 |
Capital leases | 1,486,000 | 1,355,000 |
Line of credit payable | 2,985,000 | 0 |
Mortgage notes payable - Hotel | 113,087,000 | 114,372,000 |
Mortgage notes payable - real estate | 58,571,000 | 62,873,000 |
Deferred tax liability | 0 | 245,000 |
Total liabilities | 199,308,000 | 201,647,000 |
Commitments and contingencies - Note 18 | ||
Shareholders' deficit: | ||
Preferred stock, $.01 par value, 100,000 shares authorized; none issued | 0 | 0 |
Common stock, $.01 par value, 4,000,000 shares authorized; 3,404,982 and 3,395,616 issued; 2,309,962 and 2,334,197 outstanding as of June 30, 2019 and 2018 | 33,000 | 33,000 |
Additional paid-in capital | 10,342,000 | 10,522,000 |
Accumulated deficit | (39,760,000) | (41,217,000) |
Treasury stock, at cost, 1,095,020 and 1,061,419 shares as of June 30, 2019 and 2018 | (14,347,000) | (13,268,000) |
Total Intergroup shareholders' deficit | (43,732,000) | (43,930,000) |
Noncontrolling interest | (24,697,000) | (26,037,000) |
Total shareholders' deficit | (68,429,000) | (69,967,000) |
Total liabilities and shareholders' deficit | $ 130,879,000 | $ 131,680,000 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2019 | Jun. 30, 2018 |
CONSOLIDATED BALANCE SHEETS | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 100,000 | 100,000 |
Preferred stock , shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 4,000,000 | 4,000,000 |
Common stock, shares issued | 3,404,982 | 3,395,616 |
Common stock, shares outstanding | 2,309,962 | 2,334,197 |
Treasury stock, shares | 1,095,020 | 1,061,419 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Revenues : | ||
Revenues | $ 74,753,000 | $ 71,579,000 |
Costs and operating expenses: | ||
Hotel operating expenses | (44,466,000) | (40,103,000) |
Recovery of legal settlement costs | 0 | 5,775,000 |
Real estate operating expenses | (7,810,000) | (7,579,000) |
Depreciation and amortization expense | (4,935,000) | (5,054,000) |
General and administrative expense | (2,346,000) | (3,053,000) |
Total costs and operating expenses | (59,557,000) | (50,014,000) |
Income from operations | 15,196,000 | 21,565,000 |
Other income (expense): | ||
Interest expense - mortgage | (9,788,000) | (9,767,000) |
Loss on disposal of assets | (398,000) | 0 |
Net loss on marketable securities | (1,733,000) | (1,777,000) |
Net unrealized loss on other investments | 0 | (42,000) |
Impairment loss on other investments | (98,000) | (200,000) |
Dividend and interest income | 484,000 | 277,000 |
Trading and margin interest expense | (1,150,000) | (1,187,000) |
Net other expense | (12,683,000) | (12,696,000) |
Income before income taxes | 2,513,000 | 8,869,000 |
Income tax benefit (expense) | 301,000 | (3,056,000) |
Net income | 2,814,000 | 5,813,000 |
Less: Net income attributable to the noncontrolling interest | (1,357,000) | (1,732,000) |
Net income attributable to InterGroup | $ 1,457,000 | $ 4,081,000 |
Net income per share | ||
Basic (in dollars per share) | $ 1.21 | $ 2.47 |
Diluted (in dollars per share) | 1.06 | 2.18 |
Net income per share attributable to InterGroup | ||
Basic (in dollars per share) | 0.63 | 1.73 |
Diluted (in dollars per share) | $ 0.55 | $ 1.53 |
Weighted average number of common shares outstanding (in shares) | 2,328,156 | 2,354,489 |
Weighted average number of diluted shares outstanding (in shares) | 2,658,551 | 2,672,489 |
Hotel Operations [Member] | ||
Revenues : | ||
Revenues | $ 59,881,000 | $ 57,099,000 |
Real Estate [Member] | ||
Revenues : | ||
Revenues | $ 14,872,000 | $ 14,480,000 |
CONSOLIDATED STATEMENTS OF SHAR
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' DEFICIT - USD ($) | Common Stock [Member] | Additional Paid-in Capital [Member] | Accumulated Deficit [Member] | Treasury Stock [Member] | InterGroup Shareholders' Deficit [Member] | Noncontrolling Interest [Member] | Total |
Beginning Balance at Jun. 30, 2017 | $ 33,000 | $ 10,346,000 | $ (45,298,000) | $ (12,626,000) | $ (47,545,000) | $ (27,773,000) | $ (75,318,000) |
Beginning Balance (in shares) at Jun. 30, 2017 | 3,395,616 | ||||||
Net income | $ 0 | 0 | 4,081,000 | 0 | 4,081,000 | 1,732,000 | 5,813,000 |
Stock options expense | 0 | 184,000 | 0 | 0 | 184,000 | 0 | 184,000 |
Investment in Santa Fe | 0 | (8,000) | 0 | 0 | (8,000) | 4,000 | (4,000) |
Purchase of treasury stock | 0 | 0 | 0 | (642,000) | (642,000) | 0 | (642,000) |
Ending Balance at Jun. 30, 2018 | $ 33,000 | 10,522,000 | (41,217,000) | (13,268,000) | (43,930,000) | (26,037,000) | (69,967,000) |
Ending Balance (in shares) at Jun. 30, 2018 | 3,395,616 | ||||||
Net income | $ 0 | 0 | 1,457,000 | 0 | 1,457,000 | 1,357,000 | 2,814,000 |
Issuance of stock for compensation | $ 0 | 0 | 0 | 0 | 0 | 0 | 0 |
Issuance of stock for compensation (in shares) | 9,366 | ||||||
Stock options expense | $ 0 | 76,000 | 0 | 0 | 76,000 | 0 | 76,000 |
Investment in Santa Fe | 0 | (256,000) | 0 | 0 | (256,000) | 133,000 | (123,000) |
Investment in Justice | 0 | 0 | 0 | 0 | 0 | (150,000) | (150,000) |
Purchase of treasury stock | 0 | 0 | 0 | (1,079,000) | (1,079,000) | 0 | (1,079,000) |
Ending Balance at Jun. 30, 2019 | $ 33,000 | $ 10,342,000 | $ (39,760,000) | $ (14,347,000) | $ (43,732,000) | $ (24,697,000) | $ (68,429,000) |
Ending Balance (in shares) at Jun. 30, 2019 | 3,404,982 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Cash flows from operating activities: | ||
Net income | $ 2,814,000 | $ 5,813,000 |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Net unrealized loss (gain) on marketable securities | 927,000 | (3,598,000) |
Deferred taxes | (1,713,000) | 4,352,000 |
Loss on disposal of assets | 398,000 | 0 |
Unrealized loss on other investments | 0 | 42,000 |
Impairment loss on other investments | 98,000 | 200,000 |
Depreciation and amortization | 4,777,000 | 4,776,000 |
Stock compensation expense | 76,000 | 184,000 |
Changes in assets and liabilities: | ||
Investment in marketable securities | 3,218,000 | 6,934,000 |
Other assets, net | 2,823,000 | (1,820,000) |
Accounts payable and other liabilities | 1,819,000 | (2,535,000) |
Due to securities broker | (258,000) | (1,125,000) |
Obligations for securities sold | (710,000) | (1,775,000) |
Net cash provided by operating activities | 14,269,000 | 11,448,000 |
Cash flows from investing activities: | ||
Investment in Hotel, net | (1,397,000) | (212,000) |
Investment in real estate, net | (833,000) | (732,000) |
Proceeds from (purchase of) other investments | 103,000 | 156,000 |
Investment in Santa Fe | (123,000) | (4,000) |
Investment in Justice | (150,000) | 0 |
Net cash used in investing activities | (2,400,000) | (792,000) |
Cash flows from financing activities: | ||
Net payments of mortgage and other notes payable | (6,154,000) | (2,776,000) |
Proceeds from line of credit | 2,985,000 | 0 |
Purchase of treasury stock | (1,079,000) | (642,000) |
Net cash used in financing activities | (4,248,000) | (3,418,000) |
Net increase in cash, cash equivalents and restricted cash: | 7,621,000 | 7,238,000 |
Cash, cash equivalents and restricted cash at the beginning of the year | 17,511,000 | 10,273,000 |
Cash, cash equivalents and restricted cash at the end of the year | 25,132,000 | 17,511,000 |
Supplemental information: | ||
Income taxes paid (refunds received) | (1,239,000) | 171,000 |
Interest paid | 10,011,000 | 10,399,000 |
Non-cash transactions: | ||
Additions to Hotel equipment through capital lease | $ 382,000 | $ 1,364,000 |
BUSINESS AND SIGNIFICANT ACCOUN
BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: | 12 Months Ended |
Jun. 30, 2019 | |
BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: | |
BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: | NOTE 1 – BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: Description of the Business The InterGroup Corporation, a Delaware corporation, (“InterGroup” or the “Company”) was formed to buy, develop, operate and dispose of real property and to engage in various investment activities to benefit the Company and its shareholders. As of June 30, 2019, the Company had the power to vote 86.1% of the voting shares of Santa Fe Financial Corporation (“Santa Fe”), a public company (OTCBB: SFEF). This percentage includes the power to vote an approximately 4% interest in the common stock in Santa Fe owned by the Company’s Chairman and President pursuant to a voting trust agreement entered into on June 30, 1998. Santa Fe’s primary business is conducted through the management of its 68.8% owned subsidiary, Portsmouth Square, Inc. (“Portsmouth”), a public company (OTCBB: PRSI). Portsmouth has a 93.3% limited partnership interest in Justice and is the sole general partner. InterGroup also directly owns approximately 13.4% of the common stock of Portsmouth. Justice, through its subsidiaries Justice Operating Company, LLC (“Operating”) and Justice Mezzanine Company, LLC (“Mezzanine”), owns a 544‑room hotel property located at 750 Kearny Street, San Francisco California, known as the Hilton San Francisco Financial District (the “Hotel”) and related facilities including a five-level underground parking garage. Kearny Street Parking LLC (“Parking”) is the operator of the garage. Mezzanine is a wholly-owned subsidiary of the Partnership; Operating is a wholly-owned subsidiary of Mezzanine. Mezzanine is the borrower under certain mezzanine indebtedness of Justice, and in December 2013, the Partnership conveyed ownership of the Hotel to Operating. The Hotel is operated by the partnership as a full-service Hilton brand hotel pursuant to a Franchise License Agreement with HLT Franchise Holding LLC (Hilton). Justice had a ten-year management agreement with Prism Hospitality L.P. (“Prism”) to perform certain management functions for the Hotel. Prism’s management agreement was terminated upon its expiration date of February 3, 2017. Effective December 1, 2013, GMP Management, Inc. (“GMP”), a company owned by a Justice limited partner and a related party, also provided management services for the Partnership pursuant to a management services agreement, with a three-year term, subject to the Partnership’s right to terminate earlier for cause. In June 2016, GMP resigned. On February 1, 2017, Justice entered into a Hotel management agreement (“HMA”) with Interstate Management Company, LLC (“Interstate”) to manage the Hotel with an effective takeover date of February 3, 2017. The term of management agreement is for an initial period of 10 years commencing on the takeover date and automatically renews for an additional year not to exceed five years in the aggregate subject to certain conditions. The HMA also provides for Interstate to advance a key money incentive fee to the Hotel for capital improvements in the form of a self-exhausting, interest free note payable in the amount of $2,000,000 in a separate key money agreement. The $2,000,000 is included in restricted cash balances in the consolidated balance sheets as of June 30, 2019 and 2018. As of June 30, 2019 and 2018, unamortized portion of the key money was $1,896,000 and $2,000,000, respectively, and are included in related party and other notes payable in the consolidated balance sheets. In addition to the operations of the Hotel, the Company also generates income from the ownership of real estate. Properties include apartment complexes, commercial real estate, and three single-family houses as strategic investments. The properties are located throughout the United States, but are concentrated in Texas and Southern California. The Company also has investments in unimproved real property. All of the Company’s residential rental properties are managed in-house. Principles of Consolidation The consolidated financial statements include the accounts of the Company and Santa Fe. All significant inter-company transactions and balances have been eliminated. Investment in Hotel, Net Property and equipment are stated at cost. Building improvements are depreciated on a straight-line basis over their useful lives ranging from 3 to 39 years. Furniture, fixtures, and equipment are depreciated on a straight-line basis over their useful lives ranging from 3 to 7 years. Repairs and maintenance are charged to expense as incurred. Costs of significant renewals and improvements are capitalized and depreciated over the shorter of its remaining estimated useful life or life of the asset. The cost of assets sold or retired and the related accumulated depreciation are removed from the accounts; any resulting gain or loss is included in other income (expenses). The Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable in accordance with generally accepted accounting principles (“GAAP”). If the carrying amount of the asset, including any intangible assets associated with that asset, exceeds its estimated undiscounted net cash flow, before interest, the Partnership will recognize an impairment loss equal to the difference between its carrying amount and its estimated fair value. If impairment is recognized, the reduced carrying amount of the asset will be accounted for as its new cost. For a depreciable asset, the new cost will be depreciated over the asset’s remaining useful life. Generally, fair values are estimated using discounted cash flow, replacement cost or market comparison analyses. The process of evaluating for impairment requires estimates as to future events and conditions, which are subject to varying market and economic factors. Therefore, it is reasonably possible that a change in estimate resulting from judgments as to future events could occur which would affect the recorded amounts of the property. No impairment losses were recorded for the years ended June 30, 2019 and 2018. Investment in Real Estate, Net Rental properties are stated at cost less accumulated depreciation. Depreciation of rental property is provided on the straight-line method based upon estimated useful lives of 5 to 40 years for buildings and improvements and 5 to 10 years for equipment. Expenditures for repairs and maintenance are charged to expense as incurred and major improvements are capitalized. The Company also reviews its rental property assets for impairment. No impairment losses on the investment in real estate have been recorded for the years ended June 30, 2019 and 2018. The fair value of the tangible assets of an acquired property, which includes land, building and improvements, is determined by valuing the property as if they were vacant, and incorporates costs during the lease-up periods considering current market conditions and costs to execute similar leases such lost rental revenue and tenant improvements. The value of tangible assets is depreciated using straight-line method based upon the assets estimated useful lives. Investment in Marketable Securities Marketable securities are stated at fair value as determined by the most recently traded price of each security at the balance sheet date. Marketable securities are classified as trading securities with all unrealized gains and losses on the Company’s investment portfolio recorded through the consolidated statements of operations. Other Investments, Net Other investments include non-marketable securities (carried at cost, net of any impairments loss) and non-marketable debt instruments. The Company has no significant influence or control over the entities that issue these investments. These investments are reviewed on a periodic basis for other-than-temporary impairment. The Company reviews several factors to determine whether a loss is other-than-temporary. These factors include but are not limited to: (i) the length of time an investment is in an unrealized loss position, (ii) the extent to which fair value is less than cost, (iii) the financial condition and near term prospects of the issuer and (iv) our ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in fair value. For the years ended June 30, 2019 and 2018, the Company recorded impairment losses related to other investments of $98,000 and $200,000, respectively. As of June 30, 2019 and 2018, the allowance for impairment losses was $6,367,000 and $6,269,000, respectively. Cash and Cash Equivalents Cash equivalents consist of highly liquid investments with an original maturity of three months or less when purchased and are carried at cost, which approximates fair value. As of June 30, 2019 and 2018, the Company does not have any cash equivalents. Restricted Cash Restricted cash is comprised of amounts held by lenders for payment of real estate taxes, insurance, replacement and capital addition reserves for the Hotel. It also includes key money received from Interstate that is restricted for capital improvements. Other Assets, Net Other assets include prepaid insurance, accounts receivable, franchise fees, tax refund receivable, and other miscellaneous assets. Franchise fees are stated at cost and amortized over the life of the agreement (15 years). Accounts receivable from the Hotel and rental property customers are carried at cost less an allowance for doubtful accounts that is based on management’s assessment of the collectability of accounts receivable. The Company extends unsecured credit to its customers but mitigates the associated credit risk by performing ongoing credit evaluations of its customers. Due to Securities Broker The Company may utilize margin for its marketable securities purchases through the use of standard margin agreements with national brokerage firms. Various securities brokers have advanced funds to the Company for the purchase of marketable securities under standard margin agreements. These advanced funds are recorded as a liability. Obligation for Securities Sold Obligation for securities sold represents the fair market value of shares sold with the promise to deliver that security at some future date and the fair market value of shares underlying the written call options with the obligation to deliver that security when and if the option is exercised. The obligation may be satisfied with current holdings of the same security or by subsequent purchases of that security. Unrealized gains and losses from changes in the obligation are included in the statement of operations. Accounts Payable and Other Liabilities Accounts payable and other liabilities include trade payables, advance customer deposits, accrued wages, accrued real estate taxes, and other liabilities. Treasury Stock The Company records the acquisition of treasury stock under the cost method. During the years ended June 30, 2019 and 2018, the Company purchased 33,601 and 25,527 shares of treasury stock, respectively. Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date. Accounting standards for fair value measurement establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the observability of inputs as follows: Level 1 –inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 –inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. Level 3 –inputs to the valuation methodology are unobservable and significant to the fair value. Revenue Recognition On July 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers , using the modified retrospective approach to all contracts resulting in no cumulative adjustment to accumulated deficit. The adoption of this standard did not impact the timing of our revenue recognition based on the short-term, day-to-day nature of our operations. See Note 2 - Revenue. Advertising Costs Advertising costs are expensed as incurred and are included in Hotel operating expenses in the consolidated statements of operations. Advertising costs were $282,000 and $302,000 for the years ended June 30, 2019 and 2018, respectively. Income Taxes Deferred income taxes are calculated under the liability method. Deferred income tax assets and liabilities are based on differences between the financial statement and tax basis of assets and liabilities at the current enacted tax rates. Changes in deferred income tax assets and liabilities are included as a component of income tax expense. Changes in deferred income tax assets and liabilities attributable to changes in enacted tax rates are charged or credited to income tax expense in the period of enactment. Valuation allowances are established for certain deferred tax assets where realization is not likely. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act significantly revises the future ongoing corporate income tax by, among other things, lowering corporate income tax rates. As the Company has a June 30 fiscal year-end, the lower corporate income tax rate was phased in, resulting in a statutory federal rate of approximately 28% for our fiscal year ending June 30, 2018, and 21% for subsequent fiscal years. The decrease in corporate tax rate reduced the Company’s deferred tax assets and liabilities to the lower federal base rate of 21%. As a result, a provisional net credit of $404,000 was included in the income tax expense for the year ended June 30, 2018. Assets and liabilities are established for uncertain tax positions taken or positions expected to be taken in income tax returns when such positions are judged to not meet the “more-likely-than-not” threshold based on the technical merits of the positions. Earnings Per Share Basic net income per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding. The computation of diluted net income per share is similar to the computation of basic net income per share except that the weighted-average number of common shares is increased to include the number of additional common shares that would have been outstanding if potential dilutive common shares had been issued. The Company’s only potentially dilutive common shares are stock options. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires the use of estimates and assumptions regarding certain types of assets, liabilities, revenues, and expenses. Such estimates primarily relate to the recording of allowance for doubtful accounts and allowance for impairment losses which are based on management’s assessment of the collectability of accounts receivable and the fair market value of nonmarketable securities, respectively, as of the end of the fiscal year. Actual results may differ from those estimates. Debt Issuance Costs Debt issuance costs related to a recognized debt liability are presented in the consolidated balance sheets as a direct deduction from the carrying amount of the debt liability and are amortized over the life of the debt. Loan amortization costs are included in interest expense in the consolidated statement of operations. Recent Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014‑09, Revenue from Contracts with Customers (Topic 606) (ASU 2014‑09), which amends the existing accounting standards for revenue recognition. In August 2015, the FASB issued ASU No. 2015‑14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which delays the effective date of ASU 2014‑09 by one year. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. In March 2016, the FASB issued Accounting Standards Update No. 2016‑08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016‑08) which clarifies the implementation guidance on principal versus agent considerations. The guidance includes indicators to assist an entity in determining whether it controls a specified good or service before it is transferred to the customers. The new standard permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the modified retrospective method). We applied the modified retrospective transition method to all contracts upon the adoption of ASU 2014-09 effective July 1, 2018. We provided the additional required disclosures, but the cumulative adjustment from our comparative periods was zero in our consolidated financial statements. See Note 2 – Revenue. In November 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-18, Restricted Cash. ASU 2016-18 requires companies to include restricted cash and restricted cash equivalents with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Additionally, ASU 2016-18 requires a disclosure of a reconciliation between the statement of financial position and the statement of cash flows when the balance sheet includes more than one line item for cash, cash equivalents, restricted cash, and restricted cash equivalents. ASU 2016-18 is effective for reporting periods beginning after December 15, 2017, with early adoption permitted, and will be applied retrospectively to all periods presented. The Company adopted ASU 2016-18 effective July 1, 2018. The adoption of ASU 2016-18 impacted the presentation of cash flows with inclusion of restricted cash flows for each of the presented periods. In February 2016, the FASB issued ASU No. 2016‑02, Leases (Topic 842) (ASU 2016‑02), which supersedes existing guidance on accounting for leases in Leases (Topic 840) and generally requires all leases, including operating leases, to be recognized in the statement of financial position as right-of-use assets and lease liabilities by lessees. The provisions of ASU 2016‑02 are to be applied using a modified retrospective approach and are effective for reporting periods beginning after December 15, 2018; early adoption is permitted. We adopted ASU 2016-02 on July 1, 2019. The Company is currently reviewing the effect of ASU No. 2016‑02. On June 16, 2016, the FASB issued ASU 2016‑13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” This ASU modifies the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the timelier recognition of losses. ASU No. 2016‑13 will be effective for us as of January 1, 2020. The Company is currently reviewing the effect of ASU No. 2016‑13. |
REVENUE
REVENUE | 12 Months Ended |
Jun. 30, 2019 | |
REVENUE | |
REVENUE | NOTE 2 – REVENUE Our revenue from real estate is primarily rental income from residential and commercial property leases which is recorded when due from residents and is recognized monthly as earned. The following table present our Hotel revenue disaggregated by revenue streams. For the year ended June 30, 2019 2018 Hotel revenues: Hotel rooms $ 51,243,000 $ 46,475,000 Food and beverage 5,353,000 7,222,000 Garage 2,875,000 3,011,000 Other operating departments 410,000 391,000 Total hotel revenue $ 59,881,000 $ 57,099,000 Performance obligations We identified the following performance obligations for which revenue is recognized as the respective performance obligations are satisfied, which results in recognizing the amount we expect to be entitled to for providing the goods or services: · Cancelable room reservations or ancillary services are typically satisfied as the good or service is transferred to the hotel guest, which is generally when the room stay occurs. · Noncancelable room reservations and banquet or conference reservations represent a series of distinct goods or services provided over time and satisfied as each distinct good or service is provided, which is reflected by the duration of the room reservation. · Other ancillary goods and services are purchased independently of the room reservation at standalone selling prices and are considered separate performance obligations, which are satisfied when the related good or service is provided to the hotel guest. · Components of package reservations for which each component could be sold separately to other hotel guests are considered separate performance obligations and are satisfied as set forth above. Hotel revenue primarily consists of hotel room rentals, revenue from accommodations sold in conjunction with other services (e.g., package reservations), food and beverage sales and other ancillary goods and services (e.g., parking). Revenue is recognized when rooms are occupied or goods and services have been delivered or rendered, respectively. Payment terms typically align with when the goods and services are provided. For package reservations, the transaction price is allocated to the performance obligations within the package based on the estimated standalone selling prices of each component. We do not disclose the value of unsatisfied performance obligations for contracts with an expected length of one year or less. Due to the nature of our business, our revenue is not significantly impacted by refunds. Cash payments received in advance of guests staying at our hotel are refunded to hotel guests if the guest cancels within the specified time period, before any services are rendered. Refunds related to service are generally recognized as an adjustment to the transaction price at the time the hotel stay occurs or services are rendered. Contract assets and liabilities We do not have any material contract assets as of June 30, 2019 and 2018, other than trade and other receivables, net on our consolidated balance sheets. Our receivables are primarily the result of contracts with customers, which are reduced by an allowance for doubtful accounts that reflects our estimate of amounts that will not be collected. We record contract liabilities when cash payments are received or due in advance of guests staying at our hotel, which are presented within accounts payable and other liabilities on our consolidated balance sheets. Contract liabilities increased to $1,215,000 as of June 30, 2019 from $571,000 as of June 30, 2018. The increase for the fiscal year ended June 30, 2019 was primarily driven by deposits received from upcoming groups, offset by $563,000 revenue recognized that was included in the advanced deposits balance as of June 30, 2018. Contract costs We consider sales commissions earned to be incremental costs of obtaining a contract with our customers. As a practical expedient, we expense these costs as incurred as our contracts with customers are less than one year. |
JUSTICE INVESTORS
JUSTICE INVESTORS | 12 Months Ended |
Jun. 30, 2019 | |
JUSTICE INVESTORS | |
JUSTICE INVESTORS | NOTE 3 – JUSTICE INVESTORS Justice Investors Limited Partnership, a California limited partnership (“Justice” or the “Partnership”), was formed in 1967 to acquire real property in San Francisco, California, for the development and lease of the Hotel and related facilities. The Partnership has one general partner, Portsmouth Square, Inc., a California corporation (“Portsmouth”) and approximately 23 voting limited partners, including Portsmouth. Management believes that the revenues and cash flows expected to be generated from the operations of the Hotel, garage and leases will be sufficient to meet all of the Partnership’s current and future obligations and financial requirements. Management also believes that there is significant appreciated value in the Hotel property in excess of the net book value to support additional borrowings, if necessary. |
INVESTMENT IN HOTEL, NET
INVESTMENT IN HOTEL, NET | 12 Months Ended |
Jun. 30, 2019 | |
INVESTMENT IN HOTEL, NET | |
INVESTMENT IN HOTEL, NET | NOTE 4 – INVESTMENT IN HOTEL, NET Investment in Hotel consisted of the following as of: Accumulated Net Book June 30, 2019 Cost Depreciation Value Land $ 2,738,000 $ — $ 2,738,000 Furniture and equipment 31,106,000 (26,877,000) 4,229,000 Building and improvements 63,879,000 (31,010,000) 32,869,000 $ 97,723,000 $ (57,887,000) $ 39,836,000 Accumulated Net Book June 30, 2018 Cost Depreciation Value Land $ 2,738,000 $ — $ 2,738,000 Furniture and equipment 29,350,000 (25,876,000) 3,474,000 Building and improvements 64,336,000 (29,587,000) 34,749,000 $ 96,424,000 $ (55,463,000) $ 40,961,000 |
INVESTMENT IN REAL ESTATE, NET
INVESTMENT IN REAL ESTATE, NET | 12 Months Ended |
Jun. 30, 2019 | |
INVESTMENT IN REAL ESTATE, NET | |
INVESTMENT IN REAL ESTATE, NET | NOTE 5 – INVESTMENT IN REAL ESTATE, NET At June 30, 2019, the Company’s investment in real estate consisted of twenty properties located throughout the United States. These properties include sixteen apartment complexes, three single-family houses as strategic investments, and one commercial real estate property. The Company also owns unimproved land located in Maui, Hawaii. Investment in real estate included the following: As of June 30, 2019 2018 Land $ 25,033,000 $ 25,033,000 Buildings, improvements and equipment 68,369,000 67,536,000 Accumulated depreciation (41,629,000) (39,200,000) $ 51,773,000 $ 53,369,000 |
INVESTMENT IN MARKETABLE SECURI
INVESTMENT IN MARKETABLE SECURITIES | 12 Months Ended |
Jun. 30, 2019 | |
INVESTMENT IN MARKETABLE SECURITIES | |
INVESTMENT IN MARKETABLE SECURITIES | NOTE 6 – INVESTMENT IN MARKETABLE SECURITIES The Company’s investment in marketable securities consists primarily of corporate equities. The Company has also periodically invested in corporate bonds and income producing securities, which may include interests in real estate- based companies and REITs, where financial benefit could insure to its shareholders through income and/or capital gain. At June 30, 2019 and 2018, all of the Company’s marketable securities are classified as trading securities. The change in the unrealized gains and losses on these investments are included in earnings. Trading securities are summarized as follows: Gross Gross Net Fair Investment Cost Unrealized Gain Unrealized Loss Unrealized Loss Value As of June 30, 2019 Corporate Equities $ 19,204,000 $ 1,753,000 $ (11,261,000) $ (9,508,000) $ 9,696,000 As of June 30, 2018 Corporate Equities $ 22,388,000 $ 2,450,000 $ (10,997,000) $ (8,547,000) $ 13,841,000 As of June 30, 2019 and 2018, approximately 7% of the investment marketable securities balance above is comprised of the common stock of Comstock Mining Inc (“Comstock”). As of June 30, 2019 and 2018, the Company had $11,088,000 and $10,819,000, respectively, of unrealized losses related to securities held for over one year; of which $10,900,000 and $10,646,000 are related to its investment in Comstock, respectively. Net loss on marketable securities on the statement of operations is comprised of realized and unrealized gains (losses). Below is the composition of the two components for the years ended June 30, 2019 and 2018, respectively. For the year ended June 30, 2019 2018 Realized loss on marketable securities related to Comstock $ — $ (6,007,000) Realized (loss) gain on marketable securities (806,000) 632,000 Unrealized loss on marketable securities related to Comstock (254,000) (2,337,000) Unrealized (loss) gain on marketable securities (673,000) 5,935,000 Net loss on marketable securities $ (1,733,000) $ (1,777,000) |
OTHER INVESTMENTS, NET
OTHER INVESTMENTS, NET | 12 Months Ended |
Jun. 30, 2019 | |
OTHER INVESTMENTS, NET | |
OTHER INVESTMENTS, NET | NOTE 7 – OTHER INVESTMENTS, NET The Company may also invest, with the approval of the Securities Investment Committee and other Company guidelines, in private investment equity funds and other unlisted securities. Those investments in non-marketable securities are carried at cost on the Company’s balance sheet as part of other investments, net of other than temporary impairment losses. Other investments, net consist of the following: Type June 30, 2019 June 30, 2018 Private equity hedge fund, at cost $ 376,000 $ 554,000 Other investments 236,000 259,000 $ 612,000 $ 813,000 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 12 Months Ended |
Jun. 30, 2019 | |
FAIR VALUE MEASUREMENTS | |
FAIR VALUE MEASUREMENTS | NOTE 8 – FAIR VALUE MEASUREMENTS The As of June 30, 2019 Level 1 Assets: Investment in marketable securities: REITs and real estate companies $ 3,069,000 Consumer cyclical 1,448,000 Corporate bonds 1,420,000 Financial services 951,000 Energy 950,000 Other 1,858,000 $ 9,696,000 As of June 30, 2018 Level 1 Assets: Investment in marketable securities: REITs and real estate companies $ 4,300,000 Corporate bonds 2,282,000 Technology 1,813,000 Healthcare 1,777,000 Communications 1,071,000 Other 2,598,000 $ 13,841,000 The fair values of investments in marketable securities are determined by the most recently traded price of each security at the balance sheet date. Financial assets that are measured at fair value on a non-recurring basis and are not included in the tables above include “Other investments in non-marketable securities,” that were initially measured at cost and have been written down to fair value as a result of impairment or adjusted to record the fair value of new instruments received (i.e., preferred shares) in exchange for old instruments (i.e., debt instruments). The following table shows the fair value hierarchy for these assets measured at fair value on a non-recurring basis as follows: Net loss for the year Assets Level 3 June 30, 2019 ended June 30, 2019 Other non-marketable investments $ 612,000 $ 612,000 $ (98,000) Net loss for the year Assets Level 3 June 30, 2018 ended June 30, 2018 Other non-marketable investments $ 813,000 $ 813,000 $ (242,000) For fiscal years ended June 30, 2019 and 2018, we received distribution from other non-marketable investments of $103,000 and $131,000, respectively. Other investments in non-marketable securities are carried at cost net of any impairment loss. The Company has no significant influence or control over the entities that issue these investments. These investments are reviewed on a periodic basis for other-than-temporary impairment. When determining the fair value of these investments on a non-recurring basis, the Company uses valuation techniques such as the market approach and the unobservable inputs include factors such as conversion ratios and the stock price of the underlying convertible instruments. The Company reviews several factors to determine whether a loss is other-than-temporary. These factors include but are not limited to: (i) the length of time an investment is in an unrealized loss position, (ii) the extent to which fair value is less than cost, (iii) the financial condition and near term prospects of the issuer and (iv) our ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in fair value. |
OTHER ASSETS, NET
OTHER ASSETS, NET | 12 Months Ended |
Jun. 30, 2019 | |
OTHER ASSETS, NET | |
OTHER ASSETS, NET | NOTE 9 – OTHER ASSETS, NET Other assets consist of the following as of June 30: 2019 2018 Accounts receivable, net $ 852,000 $ 1,843,000 Prepaid expenses 747,000 490,000 Miscellaneous assets, net 763,000 1,159,000 Tax Refund Receivable — 1,693,000 Total other assets $ 2,362,000 $ 5,185,000 As mentioned in Note 6 – Investment in Marketable Securities, the Company had realized loss of $6,007,000 in fiscal year ended June 30, 2018 related to the sale of common stock of Comstock. During fiscal year 2019, the Company filed a carry back claim to carry back this loss to fiscal year ended June 30, 2015. The carry back claim generated a federal income tax refund of approximately $1,860,000 which is included in other assets in the consolidated balance sheet as of June 30, 2018. The $1,860,000 refund was received in March 2019. |
RELATED PARTY AND OTHER FINANCI
RELATED PARTY AND OTHER FINANCING TRANSACTIONS | 12 Months Ended |
Jun. 30, 2019 | |
RELATED PARTY AND OTHER FINANCING TRANSACTIONS | |
RELATED PARTY AND OTHER FINANCING TRANSACTIONS | NOTE 10 – RELATED PARTY AND OTHER FINANCING TRANSACTIONS Included in the balance of the related party note payable at June 30, 2019 and 2018 is the obligation to Hilton (Franchisor) in the form of a self-exhausting, interest free development incentive note which will be reduced by approximately $316,000 annually through 2030 by Hilton if the Partnership is still a Franchisee with Hilton. As of June 30, 2019 and 2018, the balance of the note was $3,325,000 and $3,642,000, respectively. On February 1, 2017, Justice entered into a Hotel management agreement (“HMA”) with Interstate Management Company, LLC (“Interstate”) to manage the Hotel with an effective takeover date of February 3, 2017. The term of management agreement is for an initial period of 10 years commencing on the takeover date and automatically renews for an additional year not to exceed five years in the aggregate subject to certain conditions. The HMA also provides for Interstate to advance a key money incentive fee to the Hotel for capital improvements in the amount of $2,000,000 under certain terms and conditions described in a separate key money agreement. The key money contribution is a self-exhausting, interest free note and shall be amortized in equal monthly amounts over an eight (8) year period commencing on the second (2 nd ) anniversary of the takeover date. The $2,000,000 is included in restricted cash balances in the consolidated balance sheets as of June 30, 2019 and 2018. As of June 30, 2019 and 2018, unamortized portion of the key money was $1,896,000 and $2,000,000, respectively, and are included in related party and other notes payable in the consolidated balance sheets. As of June 30, 2019, the Company had capital lease obligations outstanding of $1,486,000. These capital leases expire in various years through 2023 at rates ranging from 5.77% to 6.25% per annum. Minimum future lease payments for assets under capital leases as of June 30, 2019 are as follows: For the year ending June 30, 2020 $ 493,000 2021 492,000 2022 482,000 2023 182,000 Total minimum lease payments 1,649,000 Less interest on capital lease (163,000) Present value of future minimum lease payments $ 1,486,000 In July 2018, the Company obtained a revolving $5,000,000 line of credit (“RLOC”) from CIBC Bank USA (“CIBC”). The RLOC carries a variable interest rate of 30-day LIBOR plus 3%. Interest is paid on a monthly basis. The RLOC and all accrued and unpaid interest are due in July 2019. On July 31, 2018, $2,969,000 was drawn from the RLOC to pay off the mortgage note payable at Woodland Village. In July 2019, the Company obtained a modification from CIBC which increased the RLOC by $3,000,000 and extended the maturity date from July 24, 2019 to July 23, 2020. As of June 30, 2019, outstanding balance of the RLOC was $2,985,000. Future minimum principal payments for all related party and other financing transactions are as follows: For the year ending June 30, 2020 $ 4,005,000 2021 1,006,000 2022 1,022,000 2023 744,000 2024 567,000 Thereafter 2,388,000 $ 9,732,000 |
MORTGAGE NOTES PAYABLE
MORTGAGE NOTES PAYABLE | 12 Months Ended |
Jun. 30, 2019 | |
MORTGAGE NOTES PAYABLE | |
MORTGAGE NOTES PAYABLE | NOTE 11 – MORTGAGE NOTES PAYABLE On December 18, 2013: (i) Justice Operating Company, LLC, a Delaware limited liability company (“Operating”), entered into a loan agreement (“Mortgage Loan Agreement”) with Bank of America (“Mortgage Lender”); and (ii) Justice Mezzanine Company, a Delaware limited liability company (“Mezzanine”), entered into a mezzanine loan agreement (“Mezzanine Loan Agreement” and, together with the Mortgage Loan Agreement, the “Loan Agreements”) with ISBI San Francisco Mezz Lender LLC (“Mezzanine Lender” and, together with Mortgage Lender, the “Lenders”). The Partnership is the sole member of Mezzanine, and Mezzanine is the sole member of Operating. The Loan Agreements provide for a $97,000,000 Mortgage Loan and a $20,000,000 Mezzanine Loan. The proceeds of the Loan Agreements were used to fund the redemption of limited partnership interests and the pay-off of the prior mortgage. The Mortgage Loan is secured by the Partnership’s principal asset, the Hilton San Francisco-Financial District (the “Property”). The Mortgage Loan bears an interest rate of 5.275% per annum and matures in January 2024. The term of the loan is 10 years with interest only due in the first three years and principal and interest on the remaining seven years of the loan based on a thirty-year amortization schedule. The Mortgage Loan also requires payments for impounds related to property tax, insurance and capital improvement reserves. As additional security for the Mortgage Loan, there is a limited guaranty (“Mortgage Guaranty”) executed by the Company in favor of Mortgage Lender. The Mezzanine Loan is secured by the Operating membership interest held by Mezzanine and is subordinated to the Mortgage Loan. The Mezzanine Loan bears interest at 9.75% per annum and matures on January 1, 2024. Interest only, payments are due monthly. As additional security for the Mezzanine Loan, there is a limited guaranty executed by the Company in favor of Mezzanine Lender (the “Mezzanine Guaranty” and, together with the Mortgage Guaranty, the “Guaranties”). The Guaranties are limited to what are commonly referred to as “bad boy” acts, including: (i) fraud or intentional misrepresentations; (ii) gross negligence or willful misconduct; (iii) misapplication or misappropriation of rents, security deposits, insurance or condemnation proceeds; and (iv) failure to pay taxes or insurance. The Guaranties are full recourse guaranties under identified circumstances, including failure to maintain “single purpose” status which is a factor in a consolidation of Operating or Mezzanine in a bankruptcy of another person, transfer or encumbrance of the Property in violation of the applicable loan documents, Operating or Mezzanine incurring debts that are not permitted, and the Property becoming subject to a bankruptcy proceeding. Pursuant to the Guaranties, the Partnership is required to maintain a certain minimum net worth and liquidity. As of June 30, 2019 and 2018, the Partnership is in compliance with both requirements. Each of the Loan Agreements contains customary representations and warranties, events of default, reporting requirements, affirmative covenants and negative covenants, which impose restrictions on, among other things, organizational changes of the respective borrower, operations of the Property, agreements with affiliates and third parties. Each of the Loan Agreements also provides for mandatory prepayments under certain circumstances (including casualty or condemnation events) and voluntary prepayments, subject to satisfaction of prescribed conditions set forth in the Loan Agreements. In April 2016, the Company entered into an interest rate agreement on its $923,000 mortgage note payable on its commercial property located in Los Angeles, California in order to settle the variable rate as of March 31, 2016 of 4.22% into a fixed rate of 3.99%. The swap agreement matures in January 2021. A swap is a contractual agreement to exchange interest rate payments. As of June 30, 2019, the fair market value of the swap agreement is immaterial. In June 2016, The Company refinanced its $1,929,000 mortgage note payable on its 12-unit apartment complex located in Los Angeles, California and obtained a new mortgage in the amount of $2,300,000. The interest rate on the new mortgage is 3.59% and matures in June 2026. On July 31, 2019, Mezzanine refinanced the Mezzanine Loan by entering into a new mezzanine loan agreement (“New Mezzanine Loan Agreement”) with Cred Reit Holdco LLC in the amount of $20,000,000. The prior Mezzanine Loan was paid off with no prepayment penalty. Interest rate on the new mezzanine loan is 7.25% and the loan matures on January 1, 2024. Interest only payments are due monthly. In August 2018, $1,005,000 was drawn from the Company's RLOC with CIBC to pay off a mortgage note payable on its single-family house located in Los Angeles, California. In September 2018, the Company obtained a new mortgage in the amount of $1,000,000 on the same property. The interest rate on the new loan is fixed at 4.75% per annum for the first five years and variable for the remaining of the term. The note matures in October 2048. $995,000 received as a result of the refinance was used to pay down the RLOC. Each mortgage notes payable is secured by real estate or the Hotel. As of June 30, 2019 and 2018, the mortgage notes payables are summarized as follows: As of June 30, 2019 Number Note Note Property of Units Origination Date Maturity Date Mortgage Balance Interest Rate SF Hotel 544 rooms December January $ 93,746,000 5.28 % SF Hotel 544 rooms December January 20,000,000 9.75 % Mortgage notes payable - Hotel 113,746,000 Debt issuance costs (659,000) Total mortgage notes payable - Hotel $ 113,087,000 Florence 157 March April $ 3,222,000 3.87 % Las Colinas 358 November December 16,974,000 3.73 % Morris County 151 July August 8,737,000 3.51 % Morris County 151 June August 2,512,000 4.51 % St. Louis 264 May May 5,365,000 4.05 % Los Angeles 4 September September 343,000 3.75 % Los Angeles 2 September September 347,000 3.75 % Los Angeles 1 August September 373,000 3.75 % Los Angeles 31 November December 4,927,000 4.85 % Los Angeles 30 August September 5,765,000 5.97 % Los Angeles 14 April March 1,632,000 5.89 % Los Angeles 12 June June 2,172,000 3.59 % Los Angeles 9 April May 1,303,000 5.60 % Los Angeles 9 April March 1,112,000 5.89 % Los Angeles 8 July July 440,000 3.75 % Los Angeles 7 August September 846,000 3.75 % Los Angeles 4 August September 579,000 3.75 % Los Angeles 1 September September 399,000 3.75 % Los Angeles 1 September October 990,000 4.75 % Los Angeles Office April January 806,000 4.91 % Mortgage notes payable - real estate 58,844,000 Debt issuance costs (273,000) Total mortgage notes payable - real estate $ 58,571,000 As of June 30, 2018 Number Note Note Property of Units Origination Date Maturity Date Mortgage Balance Interest Rate SF Hotel 544 rooms December January $ 95,018,000 5.28 % SF Hotel 544 rooms December January 20,000,000 9.75 % Mortgage notes payable - Hotel 115,018,000 Debt issuance costs (646,000) Total mortgage notes payable - Hotel $ 114,372,000 Florence 157 March April $ 3,291,000 3.87 % Las Colinas 358 November December 17,404,000 3.73 % Morris County 151 July August 9,068,000 3.51 % Morris County 151 June August 2,563,000 4.51 % St. Louis 264 May May 5,491,000 4.05 % Los Angeles 4 September September 352,000 3.75 % Los Angeles 2 September September 356,000 3.75 % Los Angeles 1 August September 383,000 3.75 % Los Angeles 31 November December 5,048,000 4.85 % Los Angeles 30 August September 5,907,000 5.97 % Los Angeles 27 November December 2,843,000 4.85 % Los Angeles 14 April March 1,665,000 5.89 % Los Angeles 12 June June 2,218,000 3.59 % Los Angeles 9 April May 1,331,000 5.60 % Los Angeles 9 April March 1,135,000 5.89 % Los Angeles 8 July July 451,000 3.75 % Los Angeles 7 August September 868,000 3.75 % Los Angeles 4 August September 594,000 3.75 % Los Angeles 1 September September 409,000 3.75 % Los Angeles 1 August August 1,000,000 5.75 % Los Angeles Office April January 842,000 4.55 % Mortgage notes payable - real estate 63,219,000 Debt issuance costs (346,000) Total mortgage notes payable - real estate $ 62,873,000 Future minimum payments for all mortgage notes payable are as follows: For the year ending June 30, 2020 $ 3,054,000 2021 12,483,000 2022 3,095,000 2023 37,812,000 2024 107,656,000 Thereafter 8,489,000 $ 172,589,000 |
MANAGEMENT AGREEMENTS
MANAGEMENT AGREEMENTS | 12 Months Ended |
Jun. 30, 2019 | |
MANAGEMENT AGREEMENTS | |
MANAGEMENT AGREEMENTS | NOTE 12 – MANAGEMENT AGREEMENTS On February 1, 2017, Justice entered into a Hotel management agreement (“HMA”) with Interstate Management Company, LLC (“Interstate”) to manage the Hotel with an effective takeover date of February 3, 2017. The term of management agreement is for an initial period of 10 years commencing on the takeover date and automatically renews for an additional year not to exceed five years in the aggregate subject to certain conditions. The HMA also provides for Interstate to advance a key money incentive fee to the Hotel for capital improvements in the amount of $2,000,000 under certain terms and conditions described in a separate key money agreement. The key money contribution shall be amortized in equal monthly amounts over an eight (8) year period commencing on the second (2 nd ) anniversary of the takeover date. The $2,000,000 is included in restricted cash balances in the consolidated balance sheets as of June 30, 2019 and 2018. As of June 30, 2019 and 2018, unamortized portion of the key money was $1,896,000 and $2,000,000, respectively, and are included in related party and other notes payable in the consolidated balance sheets. During the years ended June 30, 2019 and 2018, Interstate management fees were $1,206,000 and $957,000, respectively, and are included in Hotel operating expenses in the consolidated statements of operations. |
CONCENTRATION OF CREDIT RISK
CONCENTRATION OF CREDIT RISK | 12 Months Ended |
Jun. 30, 2019 | |
CONCENTRATION OF CREDIT RISK | |
CONCENTRATION OF CREDIT RISK | NOTE 13 – CONCENTRATION OF CREDIT RISK As of June 30, 2019 and 2018, all accounts receivables are related to Hotel customers. The Hotel had one account that accounted for 32%, or $272,000 of accounts receivable at June 30, 2019, and two customers that accounted for 32%, or $572,000 of accounts receivable at June 30, 2018. The Partnership maintains its cash and cash equivalents and restricted cash with various financial institutions that are monitored regularly for credit quality. At times, such cash and cash equivalents holdings may be in excess of the Federal Deposit Insurance Corporation (“FDIC”) or other federally insured limits. |
INCOME TAXES
INCOME TAXES | 12 Months Ended |
Jun. 30, 2019 | |
INCOME TAXES | |
INCOME TAXES | NOTE 14 – INCOME TAXES The provision for the Company’s income tax expense is comprised of the following: For the years ended June 30, 2019 2018 Federal Current tax (expense) benefit $ (1,387,000) $ 1,455,000 Deferred tax benefit (expense) 2,563,000 (3,567,000) 1,176,000 (2,112,000) State Current tax expense (25,000) (227,000) Deferred tax expense (850,000) (717,000) (875,000) (944,000) Income Tax Benefit (expense) $ 301,000 $ (3,056,000) The provision for income taxes differs from the amount of income tax computed by applying the federal statutory income tax rate to income before taxes as a result of the following differences: For the years ended June 30, 2019 2018 Statutory federal tax rate $ (457,000) $ (2,218,000) State income taxes, net of federal tax benefit (972,000) (623,000) Dividend received deduction 16,000 24,000 Valuation allowance 2,158,000 (330,000) Basis difference in investments 815,000 — Carryback tax payable (1,140,000) — Other (119,000) 91,000 $ 301,000 $ (3,056,000) On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act significantly revises the future ongoing corporate income tax by, among other things, lowering corporate income tax rates. As the Company has a June 30 fiscal year-end, the lower corporate income tax rate was phased in, resulting in a statutory federal rate of approximately 28% for our fiscal year ending June 30, 2018, and 21% for subsequent fiscal years. The decrease in corporate tax rate reduced the Company’s deferred tax assets and liabilities to the lower federal base rate of 21%. As a result, a provisional net credit of $404,000 was included in the income tax expense for the year ended June 30, 2018. The components of the deferred tax asset and liabilities are as follows: June 30, 2019 June 30, 2018 Deferred tax assets: Net operating loss carryforwards $ 6,810,000 $ 7,413,000 Capital loss carryforwards 1,283,000 1,132,000 Investment impairment reserve 1,295,000 1,276,000 Accruals and reserves 1,095,000 766,000 Interest expense 162,000 — Tax credits 619,000 733,000 Unrealized loss on marketable securities 547,000 — Other 231,000 190,000 Valuation allowance (524,000) (2,610,000) 11,518,000 8,900,000 Deferred tax liabilities: Equity earnings (3,188,000) (2,564,000) Deferred gains on real estate sale and depreciation (6,844,000) (5,638,000) Unrealized gains on marketable securities — (765,000) State taxes (18,000) (178,000) (10,050,000) (9,145,000) Net deferred tax asset (liability) $ 1,468,000 $ (245,000) Management considers new evidence, both positive and negative, that could affect its view of the future realization of deferred tax assets. As of June 30, 2019, because of tax planning to generate taxable income in the future, management has determined that there is sufficient positive evidence to conclude that a significant portion of its deferred tax assets are realizable. As a result, the valuation allowance decreased by $2,086,000 and $778,000, respectively, during the fiscal years ended June 30, 2019 and 2018. As of June 30, 2019, the Company had estimated net operating losses (NOLs) of $25,447,000 and $16,583,000 for federal and state purposes, respectively. Below is the break-down of the NOLs for Intergroup, Santa Fe and Portsmouth. The carryforward expires in varying amounts through the year 2037. Federal State InterGroup $ — $ — Santa Fe 9,735,000 3,913,000 Portsmouth 15,712,000 12,670,000 $ 25,447,000 $ 16,583,000 Utilization of the net operating loss carryover may be subject a substantial annual limitation if it should be determined that there has been a change in the ownership of more than 50 percent of the value of the Company’s stock, pursuant to Section 382 of the Internal Revenue Code of 1986 and similar state provisions. The annual limitation may result in the expiration of net operating loss carryovers before utilization. Assets and liabilities are established for uncertain tax positions taken or positions expected to be taken in income tax returns when such positions are judged to not meet the “more-likely-than-not” threshold based on the technical merits of the positions. As of June 30, 2019, it has been determined there are no uncertain tax positions likely to impact the Company. The Partnership files tax returns as prescribed by the tax laws of the jurisdictions in which it operates and is subject to examination by federal, state and local jurisdictions, were applicable. As of June 30, 2019, tax years beginning in fiscal 2013 remain open to examination by the major tax jurisdictions and are subject to the statute of limitations. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 12 Months Ended |
Jun. 30, 2019 | |
SEGMENT INFORMATION | |
SEGMENT INFORMATION | NOTE 15 – SEGMENT INFORMATION The Company operates in three reportable segments, the operation of the Hotel (“Hotel Operations”), the operation of its multi-family residential properties (“Real Estate Operations”) and the investment of its cash in marketable securities and other investments (“Investment Transactions”). These three operating segments, as presented in the financial statements, reflect how management internally reviews each segment’s performance. Management also makes operational and strategic decisions based on this information. Information below represents reported segments for the years ended June 30, 2019 and 2018. Segment income from Hotel operations consists of the operation of the Hotel and operation of the garage. Segment income from real estate operations consists of the operation of the rental properties. Loss from investments consists of net investment loss, dividend and interest income and investment related expenses. As of and for the year Hotel Real Estate Investment ended June 30, 2019 Operations Operations Transactions Other Total Revenues $ 59,881,000 $ 14,872,000 $ — $ — $ 74,753,000 Segment operating expenses (44,466,000) (7,810,000) — (2,346,000) (54,622,000) Segment income (loss) from operations 15,415,000 7,062,000 — (2,346,000) 20,131,000 Interest expense - mortgage (7,234,000) (2,554,000) — — (9,788,000) Loss on disposal of assets (398,000) — — — (398,000) Depreciation and amortization expense (2,506,000) (2,429,000) — — (4,935,000) Loss from investments — — (2,497,000) — (2,497,000) Income tax benefit — — — 301,000 301,000 Net income (loss) $ 5,277,000 $ 2,079,000 $ (2,497,000) $ (2,045,000) $ 2,814,000 Total assets $ 62,148,000 $ 51,773,000 $ 10,308,000 $ 6,650,000 $ 130,879,000 As of and for the year Hotel Real Estate Investment ended June 30, 2018 Operations Operations Transactions Other Total Revenues $ 57,099,000 $ 14,480,000 $ — $ — $ 71,579,000 Segment operating expenses (40,103,000) (7,579,000) — (3,053,000) (50,735,000) Segment income (loss) from operations 16,996,000 6,901,000 — (3,053,000) 20,844,000 Interest expense - mortgage (7,237,000) (2,530,000) — — (9,767,000) Recovery of legal settlement costs 5,775,000 5,775,000 Depreciation and amortization expense (2,707,000) (2,347,000) — — (5,054,000) Loss from investments — — (2,929,000) — (2,929,000) Income tax expense — — — (3,056,000) (3,056,000) Net income (loss) $ 12,827,000 $ 2,024,000 $ (2,929,000) $ (6,109,000) $ 5,813,000 Total assets $ 58,019,000 $ 53,369,000 $ 14,654,000 $ 5,638,000 $ 131,680,000 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 12 Months Ended |
Jun. 30, 2019 | |
STOCK-BASED COMPENSATION PLANS | |
STOCK-BASED COMPENSATION PLANS | NOTE 16 – STOCK-BASED COMPENSATION PLANS The Company follows the Statement of Financial Accounting Standards 123 (Revised), "Share-Based Payments" ("SFAS No. 123R"), which was primarily codified into ASC Topic 718 “Compensation – Stock Compensation”, which addresses accounting for equity-based compensation arrangements, including employee stock options and restricted stock units. The Company currently has one equity compensation plan, which is the Intergroup 2010 Omnibus Employee Incentive Plan. The InterGroup Corporation 2008 Restricted Stock Unit Plan (the “2008 RSU Plan”) terminated on its expiration date of December 8 th , 2018 as prescribed in the plan document. Both plans have been approved by the Company’s stockholders and are described below. Any outstanding options issued under the Key Employee Plan or the Non-Employee Director Plan remain effective in accordance with their terms. The InterGroup Corporation 2008 Restricted Stock Unit Plan On December 3, 2008, the Board of Directors adopted, subject to shareholder approval, an equity compensation plan for its officers, directors and key employees entitled, The InterGroup Corporation 2008 Restricted Stock Unit Plan (the “2008 RSU Plan”). The 2008 RSU Plan was approved and ratified by the shareholders on February 18, 2009. The 2008 RSU Plan authorizes the Company to issue restricted stock units (“RSUs”) as equity compensation to officers, directors and key employees of the Company on such terms and conditions established by the Compensation Committee of the Company. RSUs are not actual shares of the Company’s common stock, but rather promises to deliver common stock in the future, subject to certain vesting requirements and other restrictions as may be determined by the Committee. Holders of RSUs have no voting rights with respect to the underlying shares of common stock and holders are not entitled to receive any dividends until the RSUs vest and the shares are delivered. No awards of RSUs shall vest until at least six months after shareholder approval of the Plan. Subject to certain adjustments upon changes in capitalization, a maximum of 200,000 shares of the common stock are available for issuance to participants under the 2008 RSU Plan. The 2008 RSU Plan will terminate ten (10) years from December 3, 2008, unless terminated sooner by the Board of Directors. After the 2008 RSU Plan is terminated, no awards may be granted but awards previously granted shall remain outstanding in accordance with the Plan and their applicable terms and conditions. The shares of common stock to be delivered upon the vesting of an award of RSUs have been registered under the Securities Act, pursuant to a registration statement filed on Form S‑8 by the Company on June 16, 2010. The grant of RSUs is personal to the recipient and is not transferable. Once received, shares of common stock issuable upon the vesting of the RSUs are freely transferable subject to any requirements of Section 16(b) of the Exchange Act. Under the 2008 RSU Plan, the Compensation Committee also has the power and authority to establish and implement an exchange program that would permit the Company to offer holders of awards issued under prior shareholder approved compensation plans to exchange certain options for new RSUs on terms and conditions to be set by the Committee. The exchange program is designed to increase the retention and motivational value of awards granted under prior plans. In addition, by exchanging options for RSUs, the Company will reduce the number of shares of common stock subject to equity awards, thereby reducing potential dilution to stockholders in the event of significant increases in the value of its common stock. As of June 30, 2019, there were no RSUs outstanding. Intergroup Corporation 2010 Omnibus Employee Incentive Plan On February 24, 2010, the shareholders of the Company approved The Intergroup Corporation 2010 Omnibus Employee Incentive Plan (the “2010 Incentive Plan”), which was formally adopted by the Board of Directors following the annual meeting of shareholders. The Company believes that such awards better align the interests of its employees with those of its shareholders. Option awards are generally granted with an exercise price equal to the market price of the Company’s stock at the date of grant; those option awards generally vest based on 5 years of continuous service. Certain option and share awards provide for accelerated vesting if there is a change in control, as defined in the 2010 Incentive Plan. The 2010 Incentive plan as modified in December 2013, authorizes a total of up to 400,000 shares of common stock to be issued as equity compensation to officers and employees of the Company in an amount and in a manner to be determined by the Compensation Committee in accordance with the terms of the 2010 Incentive Plan. The 2010 Incentive Plan authorizes the awards of several types of equity compensation including stock options, stock appreciation rights, performance awards and other stock-based compensation. The 2010 Incentive Plan will expire on February 23, 2020, if not terminated sooner by the Board of Directors upon recommendation of the Compensation Committee. Any awards issued under the 2010 Incentive Plan will expire under the terms of the grant agreement. The shares of common stock to be issued under the 2010 Incentive Plan have been registered under the Securities Act, pursuant to a registration statement filed on Form S‑8 by the Company on June 16, 2010. Once received, shares of common stock issued under the Plan will be freely transferable subject to any requirements of Section 16 (b) of the Exchange Act. On March 16, 2010, the Compensation Committee authorized the grant of 100,000 stock options to the Company’s Chairman, President and Chief Executive, John V. Winfield to purchase up to 100,000 shares of the Company’s common stock pursuant to the 2010 Incentive Plan. The exercise price of the options is $10.30, which is 100% of the fair market value of the Company’s Common Stock as determined by reference to the closing price of the Company’s Common Stock as reported on the NASDAQ Capital Market on March 16, 2010, the date of grant. The options expire ten years from the date of grant, unless terminated earlier in accordance with the terms of the 2010 Incentive Plan. The options shall be subject to both time and market based vesting requirements, each of which must be satisfied before options are fully vested and eligible to be exercised. Pursuant to the time vesting requirements, the options vest over a period of five years, with 20,000 options vesting upon each one-year anniversary of the date of grant. Pursuant to the market vesting requirements, the options vest in increments of 20,000 shares upon each increase of $2.00 or more in the market price of the Company’s common stock above the exercise price ($10.30) of the options. To satisfy this requirement, the common stock must trade at that increased level for a period of at least ten trading days during any one quarter. As of June 30, 2019, all the market vesting requirements have been met. In February 2012, the Compensation Committee awarded 90,000 stock options to the Company’s Chairman, President and Chief Executive, John V. Winfield to purchase up to 90,000 shares of common stock. The per share exercise price of the options is $19.77 which is the fair value of the Company’s Common Stock as reported on NASDAQ on February 28, 2012. The options expire ten years from the date of grant. The options are subject to both time and market based vesting requirements, each of which must be satisfied before the options are fully vested and eligible to be exercised. Pursuant to the time vesting requirements, the options vest over a period of five years, with 18,000 options vesting upon each one-year anniversary of the date of grant. Pursuant to the market vesting requirements, the options vest in increments of 18,000 shares upon each increase of $2.00 or more in the market price of the Company’s common stock above the exercise price ($19.77) of the options. To satisfy this requirement, the common stock must trade at that increased level for a period of at least ten trading days during any one quarter. As of June 30, 2019, all of these options have met the market vesting requirements. On December 26, 2013, the Compensation Committee authorized, subject to shareholder approval, a grant of non-qualified and incentive stock options for an aggregate of 160,000 shares (the “Option Grant”) to the Company’s President and Chief Executive Officer, John V. Winfield. The stock option grant was approved by shareholders on February 19, 2014. The grant of stock options was made pursuant to, and consistent with, the 2010 Incentive Plan, as proposed to be amended. The non-qualified stock options are for 133,195 shares and have a term of ten years, expiring on December 26, 2023, with an exercise price of $18.65 per share. The incentive stock options are for 26,805 shares and have a term of five years, expiring on December 26, 2018, with an exercise price of $20.52 per share. In accordance with the terms of the 2010 Incentive Plan, the exercise prices were based on 100% and 110%, respectively, of the fair market value of the Company’s common stock as determined by reference to the closing price of the Company’s common stock as reported on the NASDAQ Capital Market on the date of grant. The stock options are subject to time vesting requirements, with 20% of the options vesting annually commencing on the first anniversary of the grant date. In December 2018, Mr. Winfield exercised the 26,805 vested incentive stock options by surrendering 17,439 shares of the Company’s common stock at fair value as payment of the exercise price, resulting in a net issuance to him of 9,366 shares. No additional compensation expense was recorded related to the issuance. In March 2017, the Compensation Committee awarded 18,000 stock options to the Company’s Vice President of Real Estate, David C. Gonzalez, to purchase up to 18,000 shares of common stock. The per share exercise price of the options is $27.30 which is the fair value of the Company’s Common Stock as reported on NASDAQ on March 2, 2017. The options expire ten years from the date of grant. Pursuant to the time vesting requirements, the options vest over a period of five years, with 3,600 options vesting upon each one-year anniversary of the date of grant. During the years ended June 30, 2019 and 2018, the Company recorded stock option compensation expense of $76,000 and $184,000, respectively, related to stock options previously issued. As of June 30, 2019, there was an estimated total of $44,000 unamortized compensation related to stock options which is expected to be recognized over the weighted-average of 2.67 years. Option-pricing models require the input of various subjective assumptions, including the option’s expected life, estimated forfeiture rates and the price volatility of the underlying stock. The expected stock price volatility is based on analysis of the Company’s stock price history. The Company has selected to use the simplified method for estimating the expected term. The risk-free interest rate is based on the U.S. Treasury interest rates whose term is consistent with the expected life of the stock options. No dividend yield is included as the Company has not issued any dividends and does not anticipate issuing any dividends in the future. The following table summarizes the stock options activity from July 1, 2017 through June 30, 2019: Number of Weighted Average Weighted Average Aggregate Shares Exercise Price Remaining Life Intrinsic Value Outstanding at July 1, 2017 368,000 $ 17.21 5.17 years $ 3,046,000 Granted — — Exercised — — Forfeited — — Exchanged — — Outstanding at June 30, 2018 368,000 $ 17.21 4.17 years $ 3,505,000 Exercisable at June 30, 2018 318,000 $ 16.47 3.79 years $ 3,257,000 Vested and Expected to vest at June 30, 2018 368,000 $ 17.21 4.17 years $ 3,505,000 Outstanding at July 1, 2018 368,000 $ 17.21 4.17 years $ 3,505,000 Granted — — Exercised (26,805) 20.52 Forfeited — — Exchanged — — Outstanding at June 30, 2019 341,195 $ 16.95 3.07 years $ 4,680,000 Exercisable at June 30, 2019 330,395 $ 16.62 2.92 years $ 4,643,000 Vested and Expected to vest at June 30, 2019 341,195 $ 16.95 3.07 years $ 4,680,000 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 12 Months Ended |
Jun. 30, 2019 | |
RELATED PARTY TRANSACTIONS | |
RELATED PARTY TRANSACTIONS | NOTE 17 – RELATED PARTY TRANSACTIONS In connection with the redemption of limited partnership interests of Justice, Justice Operating Company, LLC agreed to pay a total of $1,550,000 in fees to certain officers and directors of the Company for services rendered in connection with the redemption of partnership interests, refinancing of Justice’s properties and reorganization of Justice. This agreement was superseded by a letter dated December 11, 2013 from Justice, in which Justice assumed the payment obligations of Justice Operating Company, LLC. As of June 30, 2018, $200,000 of these fees remained payable and are paid off as of June 30, 2019. As Chairman of the Securities Investment Committee, the Company’s President and Chief Executive Officer (CEO), John V. Winfield, directs the investment activity of the Company in public and private markets pursuant to authority granted by the Board of Directors. Mr. Winfield also serves as Chief Executive Officer and Chairman of the Portsmouth and Santa Fe and oversees the investment activity of those companies. Depending on certain market conditions and various risk factors, the Chief Executive Officer, Portsmouth and Santa Fe may, at times, invest in the same companies in which the Company invests. Such investments align the interests of the Company with the interests of related parties because it places the personal resources of the Chief Executive Officer and the resources of the Portsmouth and Santa Fe, at risk in substantially the same manner as the Company in connection with investment decisions made on behalf of the Company. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 12 Months Ended |
Jun. 30, 2019 | |
COMMITMENTS AND CONTINGENCIES | |
COMMITMENTS AND CONTINGENCIES | NOTE 18 – COMMITMENTS AND CONTINGENCIES Franchise Agreements The Partnership entered into a Franchise License Agreement (the “License Agreement”) with the HLT Existing Franchise Holding LLC (“Hilton”) on November 24, 2004. The term of the License agreement was for an initial period of 15 years commencing on the date the Hotel began operating as a Hilton hotel, with an option to extend the License Agreement for another five years, subject to certain conditions. On June 26, 2015, Operating and Hilton entered into an amended franchise agreement which amongst other things extended the License Agreement through 2030, and also provided the Partnership certain key money cash incentives to be earned through 2030. Since the opening of the Hotel in January 2006, the Partnership has incurred monthly royalties, program fees and information technology recapture charges equal to a percentage of the Hotel’s gross room revenue. Fees for such services during fiscal year 2019 and 2018 totaled approximately $4.1 million and $3.8 million, respectively. Hotel Employees Effective February 3, 2017, the Partnership had no employees. On February 3, 2017, Interstate assumed all labor union agreements and retained employees of their choice to continue providing services to the Hotel. As of June 30, 2019, approximately 85% of those employees were represented by one of four labor unions, and their terms of employment were determined under a collective bargaining agreement (“CBA”) to which the Partnership was a party. During the fiscal year ended June 30, 2019, the Partnership renewed the CBA for Local 39 (Stationary Engineers), and Local 665 (Parking Employees). CBA for Local 2 (Hotel and Restaurant Employees) expired on August 13, 2018 and was renewed in August 2019. CBA for Local 856 (International Brotherhood of Teamsters) will expire on December 31, 2022. Negotiation of collective bargaining agreements, which includes not just terms and conditions of employment, but scope and coverage of employees, is a regular and expected course of business operations for the Partnership and Interstate. The Partnership expects and anticipates that the terms of conditions of CBAs will have an impact on wage and benefit costs, operating expenses, and certain hotel operations during the life of each CBA, and incorporates these principles into its operating and budgetary practices. Legal Matters In April 2014, the Partnership commenced an arbitration action against Glaser Weil Fink Howard Avchen & Shapiro, LLP (formerly known as Glaser Weil Fink Jacobs Howard Avchen & Shapiro, LLP), Brett J. Cohen, Gary N. Jacobs, Janet S. McCloud, Paul B. Salvaty, and Joseph K. Fletcher III (collectively, the “Respondents”) in connection with the redemption transaction. The arbitration alleged legal malpractice against the Respondents and also sought declaratory relief regarding provisions of the option agreement in the redemption transaction and regarding the engagement letter with Respondents. Prior to arbitration proceedings, the parties agreed in principle to settle the matter, and entered into a settlement agreement and mutual general release in April 2018. The Respondents agreed to pay $8,300,000, which was received in May of 2018. $5,575,000 was recorded as a recovery of legal settlement cost and $2,725,000 was recorded as a reduction of legal expense for the fiscal year ended June 30, 2018. The Company is subject to legal proceedings, claims, and litigation arising in the ordinary course of business. The Company defends itself vigorously against any such claims. Management does not believe that the impact of such matters will have a material effect on the financial conditions or result of operations when resolved. |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 12 Months Ended |
Jun. 30, 2019 | |
SUBSEQUENT EVENTS | |
SUBSEQUENT EVENTS | NOTE 19 – SUBSEQUENT EVENTS On July 31, 2019, Mezzanine refinanced the Mezzanine Loan by entering into a new mezzanine loan agreement (“New Mezzanine Loan Agreement”) with Cred Reit Holdco LLC in the amount of $20,000,000. The prior Mezzanine Loan was paid off. Interest rate on the new mezzanine loan is 7.25% and the loan matures on January 1, 2024. Interest only payments are due monthly. In July 2019, the Company obtained a modification from CIBC Bank USA (“CIBC”) which increased its $5,000,000 revolving line of credit (“RLOC”) by $3,000,000 and extended the maturity date from July 24, 2019 to July 23, 2020. |
BUSINESS AND SIGNIFICANT ACCO_2
BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: (Policies) | 12 Months Ended |
Jun. 30, 2019 | |
BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: | |
Basis of Accounting, Policy [Policy Text Block] | Description of the Business The InterGroup Corporation, a Delaware corporation, (“InterGroup” or the “Company”) was formed to buy, develop, operate and dispose of real property and to engage in various investment activities to benefit the Company and its shareholders. As of June 30, 2019, the Company had the power to vote 86.1% of the voting shares of Santa Fe Financial Corporation (“Santa Fe”), a public company (OTCBB: SFEF). This percentage includes the power to vote an approximately 4% interest in the common stock in Santa Fe owned by the Company’s Chairman and President pursuant to a voting trust agreement entered into on June 30, 1998. Santa Fe’s primary business is conducted through the management of its 68.8% owned subsidiary, Portsmouth Square, Inc. (“Portsmouth”), a public company (OTCBB: PRSI). Portsmouth has a 93.3% limited partnership interest in Justice and is the sole general partner. InterGroup also directly owns approximately 13.4% of the common stock of Portsmouth. Justice, through its subsidiaries Justice Operating Company, LLC (“Operating”) and Justice Mezzanine Company, LLC (“Mezzanine”), owns a 544‑room hotel property located at 750 Kearny Street, San Francisco California, known as the Hilton San Francisco Financial District (the “Hotel”) and related facilities including a five-level underground parking garage. Kearny Street Parking LLC (“Parking”) is the operator of the garage. Mezzanine is a wholly-owned subsidiary of the Partnership; Operating is a wholly-owned subsidiary of Mezzanine. Mezzanine is the borrower under certain mezzanine indebtedness of Justice, and in December 2013, the Partnership conveyed ownership of the Hotel to Operating. The Hotel is operated by the partnership as a full-service Hilton brand hotel pursuant to a Franchise License Agreement with HLT Franchise Holding LLC (Hilton). Justice had a ten-year management agreement with Prism Hospitality L.P. (“Prism”) to perform certain management functions for the Hotel. Prism’s management agreement was terminated upon its expiration date of February 3, 2017. Effective December 1, 2013, GMP Management, Inc. (“GMP”), a company owned by a Justice limited partner and a related party, also provided management services for the Partnership pursuant to a management services agreement, with a three-year term, subject to the Partnership’s right to terminate earlier for cause. In June 2016, GMP resigned. On February 1, 2017, Justice entered into a Hotel management agreement (“HMA”) with Interstate Management Company, LLC (“Interstate”) to manage the Hotel with an effective takeover date of February 3, 2017. The term of management agreement is for an initial period of 10 years commencing on the takeover date and automatically renews for an additional year not to exceed five years in the aggregate subject to certain conditions. The HMA also provides for Interstate to advance a key money incentive fee to the Hotel for capital improvements in the form of a self-exhausting, interest free note payable in the amount of $2,000,000 in a separate key money agreement. The $2,000,000 is included in restricted cash balances in the consolidated balance sheets as of June 30, 2019 and 2018. As of June 30, 2019 and 2018, unamortized portion of the key money was $1,896,000 and $2,000,000, respectively, and are included in related party and other notes payable in the consolidated balance sheets. In addition to the operations of the Hotel, the Company also generates income from the ownership of real estate. Properties include apartment complexes, commercial real estate, and three single-family houses as strategic investments. The properties are located throughout the United States, but are concentrated in Texas and Southern California. The Company also has investments in unimproved real property. All of the Company’s residential rental properties are managed in-house. |
Consolidation, Policy [Policy Text Block] | Principles of Consolidation The consolidated financial statements include the accounts of the Company and Santa Fe. All significant inter-company transactions and balances have been eliminated. |
Property, Plant and Equipment, Policy [Policy Text Block] | Investment in Hotel, Net Property and equipment are stated at cost. Building improvements are depreciated on a straight-line basis over their useful lives ranging from 3 to 39 years. Furniture, fixtures, and equipment are depreciated on a straight-line basis over their useful lives ranging from 3 to 7 years. Repairs and maintenance are charged to expense as incurred. Costs of significant renewals and improvements are capitalized and depreciated over the shorter of its remaining estimated useful life or life of the asset. The cost of assets sold or retired and the related accumulated depreciation are removed from the accounts; any resulting gain or loss is included in other income (expenses). The Company reviews property and equipment for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable in accordance with generally accepted accounting principles (“GAAP”). If the carrying amount of the asset, including any intangible assets associated with that asset, exceeds its estimated undiscounted net cash flow, before interest, the Partnership will recognize an impairment loss equal to the difference between its carrying amount and its estimated fair value. If impairment is recognized, the reduced carrying amount of the asset will be accounted for as its new cost. For a depreciable asset, the new cost will be depreciated over the asset’s remaining useful life. Generally, fair values are estimated using discounted cash flow, replacement cost or market comparison analyses. The process of evaluating for impairment requires estimates as to future events and conditions, which are subject to varying market and economic factors. Therefore, it is reasonably possible that a change in estimate resulting from judgments as to future events could occur which would affect the recorded amounts of the property. No impairment losses were recorded for the years ended June 30, 2019 and 2018. |
Investment In Real Estate [Policy Text Block] | Investment in Real Estate, Net Rental properties are stated at cost less accumulated depreciation. Depreciation of rental property is provided on the straight-line method based upon estimated useful lives of 5 to 40 years for buildings and improvements and 5 to 10 years for equipment. Expenditures for repairs and maintenance are charged to expense as incurred and major improvements are capitalized. The Company also reviews its rental property assets for impairment. No impairment losses on the investment in real estate have been recorded for the years ended June 30, 2019 and 2018. The fair value of the tangible assets of an acquired property, which includes land, building and improvements, is determined by valuing the property as if they were vacant, and incorporates costs during the lease-up periods considering current market conditions and costs to execute similar leases such lost rental revenue and tenant improvements. The value of tangible assets is depreciated using straight-line method based upon the assets estimated useful lives. |
Marketable Securities, Policy [Policy Text Block] | Investment in Marketable Securities Marketable securities are stated at fair value as determined by the most recently traded price of each security at the balance sheet date. Marketable securities are classified as trading securities with all unrealized gains and losses on the Company’s investment portfolio recorded through the consolidated statements of operations. |
Other Investment Policy [Policy Text Block] | Other Investments, Net Other investments include non-marketable securities (carried at cost, net of any impairments loss) and non-marketable debt instruments. The Company has no significant influence or control over the entities that issue these investments. These investments are reviewed on a periodic basis for other-than-temporary impairment. The Company reviews several factors to determine whether a loss is other-than-temporary. These factors include but are not limited to: (i) the length of time an investment is in an unrealized loss position, (ii) the extent to which fair value is less than cost, (iii) the financial condition and near term prospects of the issuer and (iv) our ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in fair value. For the years ended June 30, 2019 and 2018, the Company recorded impairment losses related to other investments of $98,000 and $200,000, respectively. As of June 30, 2019 and 2018, the allowance for impairment losses was $6,367,000 and $6,269,000, respectively. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents Cash equivalents consist of highly liquid investments with an original maturity of three months or less when purchased and are carried at cost, which approximates fair value. As of June 30, 2019 and 2018, the Company does not have any cash equivalents. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash Restricted cash is comprised of amounts held by lenders for payment of real estate taxes, insurance, replacement and capital addition reserves for the Hotel. It also includes key money received from Interstate that is restricted for capital improvements. |
Other Assets [Policy Text Block] | Other Assets, Net Other assets include prepaid insurance, accounts receivable, franchise fees, tax refund receivable, and other miscellaneous assets. Franchise fees are stated at cost and amortized over the life of the agreement (15 years). Accounts receivable from the Hotel and rental property customers are carried at cost less an allowance for doubtful accounts that is based on management’s assessment of the collectability of accounts receivable. The Company extends unsecured credit to its customers but mitigates the associated credit risk by performing ongoing credit evaluations of its customers. |
Due To And From Broker Dealers [Policy Text Block] | Due to Securities Broker The Company may utilize margin for its marketable securities purchases through the use of standard margin agreements with national brokerage firms. Various securities brokers have advanced funds to the Company for the purchase of marketable securities under standard margin agreements. These advanced funds are recorded as a liability. |
Obligations For Securities Sold Policy [Policy Text Block] | Obligation for Securities Sold Obligation for securities sold represents the fair market value of shares sold with the promise to deliver that security at some future date and the fair market value of shares underlying the written call options with the obligation to deliver that security when and if the option is exercised. The obligation may be satisfied with current holdings of the same security or by subsequent purchases of that security. Unrealized gains and losses from changes in the obligation are included in the statement of operations. |
Accounts Payable And Other Liabilities Policy [Policy Text Block] | Accounts Payable and Other Liabilities Accounts payable and other liabilities include trade payables, advance customer deposits, accrued wages, accrued real estate taxes, and other liabilities. |
Treasury Stock Policy [Policy Text Block] | Treasury Stock The Company records the acquisition of treasury stock under the cost method. During the years ended June 30, 2019 and 2018, the Company purchased 33,601 and 25,527 shares of treasury stock, respectively. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value of Financial Instruments Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability (i.e., the “exit price”) in an orderly transaction between market participants at the measurement date. Accounting standards for fair value measurement establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs that market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the assumptions market participants would use in pricing the asset or liability developed based on the best information available in the circumstances. The hierarchy is broken down into three levels based on the observability of inputs as follows: Level 1 –inputs to the valuation methodology are quoted prices (unadjusted) for identical assets or liabilities in active markets. Level 2 –inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the assets or liability, either directly or indirectly, for substantially the full term of the financial instruments. Level 3 –inputs to the valuation methodology are unobservable and significant to the fair value. |
Revenue Recognition, Policy [Policy Text Block] | Revenue Recognition On July 1, 2018, we adopted ASC 606, Revenue from Contracts with Customers , using the modified retrospective approach to all contracts resulting in no cumulative adjustment to accumulated deficit. The adoption of this standard did not impact the timing of our revenue recognition based on the short-term, day-to-day nature of our operations. See Note 2 - Revenue. |
Advertising Costs, Policy [Policy Text Block] | Advertising Costs Advertising costs are expensed as incurred and are included in Hotel operating expenses in the consolidated statements of operations. Advertising costs were $282,000 and $302,000 for the years ended June 30, 2019 and 2018, respectively. |
Income Tax, Policy [Policy Text Block] | Income Taxes Deferred income taxes are calculated under the liability method. Deferred income tax assets and liabilities are based on differences between the financial statement and tax basis of assets and liabilities at the current enacted tax rates. Changes in deferred income tax assets and liabilities are included as a component of income tax expense. Changes in deferred income tax assets and liabilities attributable to changes in enacted tax rates are charged or credited to income tax expense in the period of enactment. Valuation allowances are established for certain deferred tax assets where realization is not likely. On December 22, 2017, the U.S. government enacted comprehensive tax legislation commonly referred to as the Tax Cuts and Jobs Act (the “Tax Act”). The Tax Act significantly revises the future ongoing corporate income tax by, among other things, lowering corporate income tax rates. As the Company has a June 30 fiscal year-end, the lower corporate income tax rate was phased in, resulting in a statutory federal rate of approximately 28% for our fiscal year ending June 30, 2018, and 21% for subsequent fiscal years. The decrease in corporate tax rate reduced the Company’s deferred tax assets and liabilities to the lower federal base rate of 21%. As a result, a provisional net credit of $404,000 was included in the income tax expense for the year ended June 30, 2018. Assets and liabilities are established for uncertain tax positions taken or positions expected to be taken in income tax returns when such positions are judged to not meet the “more-likely-than-not” threshold based on the technical merits of the positions. |
Earnings Per Share, Policy [Policy Text Block] | Earnings Per Share Basic net income per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding. The computation of diluted net income per share is similar to the computation of basic net income per share except that the weighted-average number of common shares is increased to include the number of additional common shares that would have been outstanding if potential dilutive common shares had been issued. The Company’s only potentially dilutive common shares are stock options. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (U.S. GAAP) requires the use of estimates and assumptions regarding certain types of assets, liabilities, revenues, and expenses. Such estimates primarily relate to the recording of allowance for doubtful accounts and allowance for impairment losses which are based on management’s assessment of the collectability of accounts receivable and the fair market value of nonmarketable securities, respectively, as of the end of the fiscal year. Actual results may differ from those estimates. |
New Accounting Pronouncements, Policy [Policy Text Block] | Recent Accounting Pronouncements In May 2014, the FASB issued Accounting Standards Update No. 2014‑09, Revenue from Contracts with Customers (Topic 606) (ASU 2014‑09), which amends the existing accounting standards for revenue recognition. In August 2015, the FASB issued ASU No. 2015‑14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date, which delays the effective date of ASU 2014‑09 by one year. The FASB also agreed to allow entities to choose to adopt the standard as of the original effective date. In March 2016, the FASB issued Accounting Standards Update No. 2016‑08, Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) (ASU 2016‑08) which clarifies the implementation guidance on principal versus agent considerations. The guidance includes indicators to assist an entity in determining whether it controls a specified good or service before it is transferred to the customers. The new standard permits two methods of adoption: retrospectively to each prior reporting period presented (full retrospective method), or retrospectively with the cumulative effect of initially applying the guidance recognized at the date of initial application (the modified retrospective method). We applied the modified retrospective transition method to all contracts upon the adoption of ASU 2014-09 effective July 1, 2018. We provided the additional required disclosures, but the cumulative adjustment from our comparative periods was zero in our consolidated financial statements. See Note 2 – Revenue. In November 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2016-18, Restricted Cash. ASU 2016-18 requires companies to include restricted cash and restricted cash equivalents with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. Additionally, ASU 2016-18 requires a disclosure of a reconciliation between the statement of financial position and the statement of cash flows when the balance sheet includes more than one line item for cash, cash equivalents, restricted cash, and restricted cash equivalents. ASU 2016-18 is effective for reporting periods beginning after December 15, 2017, with early adoption permitted, and will be applied retrospectively to all periods presented. The Company adopted ASU 2016-18 effective July 1, 2018. The adoption of ASU 2016-18 impacted the presentation of cash flows with inclusion of restricted cash flows for each of the presented periods. In February 2016, the FASB issued ASU No. 2016‑02, Leases (Topic 842) (ASU 2016‑02), which supersedes existing guidance on accounting for leases in Leases (Topic 840) and generally requires all leases, including operating leases, to be recognized in the statement of financial position as right-of-use assets and lease liabilities by lessees. The provisions of ASU 2016‑02 are to be applied using a modified retrospective approach and are effective for reporting periods beginning after December 15, 2018; early adoption is permitted. We adopted ASU 2016-02 on July 1, 2019. The Company is currently reviewing the effect of ASU No. 2016‑02. On June 16, 2016, the FASB issued ASU 2016‑13, “Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.” This ASU modifies the impairment model to utilize an expected loss methodology in place of the currently used incurred loss methodology, which will result in the timelier recognition of losses. ASU No. 2016‑13 will be effective for us as of January 1, 2020. The Company is currently reviewing the effect of ASU No. 2016‑13. |
REVENUE (Tables)
REVENUE (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
REVENUE | |
Schedule of disaggregation of revenue | Our revenue from real estate is primarily rental income from residential and commercial property leases which is recorded when due from residents and is recognized monthly as earned. The following table present our Hotel revenue disaggregated by revenue streams. For the year ended June 30, 2019 2018 Hotel revenues: Hotel rooms $ 51,243,000 $ 46,475,000 Food and beverage 5,353,000 7,222,000 Garage 2,875,000 3,011,000 Other operating departments 410,000 391,000 Total hotel revenue $ 59,881,000 $ 57,099,000 |
INVESTMENT IN HOTEL, NET (Table
INVESTMENT IN HOTEL, NET (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
INVESTMENT IN HOTEL, NET | |
Schedule of Investment in Hotel | Investment in Hotel consisted of the following as of: Accumulated Net Book June 30, 2019 Cost Depreciation Value Land $ 2,738,000 $ — $ 2,738,000 Furniture and equipment 31,106,000 (26,877,000) 4,229,000 Building and improvements 63,879,000 (31,010,000) 32,869,000 $ 97,723,000 $ (57,887,000) $ 39,836,000 Accumulated Net Book June 30, 2018 Cost Depreciation Value Land $ 2,738,000 $ — $ 2,738,000 Furniture and equipment 29,350,000 (25,876,000) 3,474,000 Building and improvements 64,336,000 (29,587,000) 34,749,000 $ 96,424,000 $ (55,463,000) $ 40,961,000 |
INVESTMENT IN REAL ESTATE, NET
INVESTMENT IN REAL ESTATE, NET (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
INVESTMENT IN REAL ESTATE, NET | |
Schedule of investment in real estate | Investment in real estate included the following: As of June 30, 2019 2018 Land $ 25,033,000 $ 25,033,000 Buildings, improvements and equipment 68,369,000 67,536,000 Accumulated depreciation (41,629,000) (39,200,000) $ 51,773,000 $ 53,369,000 |
INVESTMENT IN MARKETABLE SECU_2
INVESTMENT IN MARKETABLE SECURITIES (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
INVESTMENT IN MARKETABLE SECURITIES | |
Schedule of trading securities | At June 30, 2019 and 2018, all of the Company’s marketable securities are classified as trading securities. The change in the unrealized gains and losses on these investments are included in earnings. Trading securities are summarized as follows: Gross Gross Net Fair Investment Cost Unrealized Gain Unrealized Loss Unrealized Loss Value As of June 30, 2019 Corporate Equities $ 19,204,000 $ 1,753,000 $ (11,261,000) $ (9,508,000) $ 9,696,000 As of June 30, 2018 Corporate Equities $ 22,388,000 $ 2,450,000 $ (10,997,000) $ (8,547,000) $ 13,841,000 |
Schedule of net loss on marketable securities comprising of realized and unrealized gains (losses) | Net loss on marketable securities on the statement of operations is comprised of realized and unrealized gains (losses). Below is the composition of the two components for the years ended June 30, 2019 and 2018, respectively. For the year ended June 30, 2019 2018 Realized loss on marketable securities related to Comstock $ — $ (6,007,000) Realized (loss) gain on marketable securities (806,000) 632,000 Unrealized loss on marketable securities related to Comstock (254,000) (2,337,000) Unrealized (loss) gain on marketable securities (673,000) 5,935,000 Net loss on marketable securities $ (1,733,000) $ (1,777,000) |
OTHER INVESTMENTS, NET (Tables)
OTHER INVESTMENTS, NET (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
OTHER INVESTMENTS, NET | |
Schedule of other investments, net | Other investments, net consist of the following: Type June 30, 2019 June 30, 2018 Private equity hedge fund, at cost $ 376,000 $ 554,000 Other investments 236,000 259,000 $ 612,000 $ 813,000 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
FAIR VALUE MEASUREMENTS | |
Schedule of Fair value measurement on recurring basis | As of June 30, 2019 Level 1 Assets: Investment in marketable securities: REITs and real estate companies $ 3,069,000 Consumer cyclical 1,448,000 Corporate bonds 1,420,000 Financial services 951,000 Energy 950,000 Other 1,858,000 $ 9,696,000 As of June 30, 2018 Level 1 Assets: Investment in marketable securities: REITs and real estate companies $ 4,300,000 Corporate bonds 2,282,000 Technology 1,813,000 Healthcare 1,777,000 Communications 1,071,000 Other 2,598,000 $ 13,841,000 |
Schedule of Fair value measurements on non-recurring basis | The following table shows the fair value hierarchy for these assets measured at fair value on a non-recurring basis as follows: Net loss for the year Assets Level 3 June 30, 2019 ended June 30, 2019 Other non-marketable investments $ 612,000 $ 612,000 $ (98,000) Net loss for the year Assets Level 3 June 30, 2018 ended June 30, 2018 Other non-marketable investments $ 813,000 $ 813,000 $ (242,000) |
OTHER ASSETS, NET (Tables)
OTHER ASSETS, NET (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
OTHER ASSETS, NET | |
Schedule of Other assets | Other assets consist of the following as of June 30: 2019 2018 Accounts receivable, net $ 852,000 $ 1,843,000 Prepaid expenses 747,000 490,000 Miscellaneous assets, net 763,000 1,159,000 Tax Refund Receivable — 1,693,000 Total other assets $ 2,362,000 $ 5,185,000 |
RELATED PARTY AND OTHER FINAN_2
RELATED PARTY AND OTHER FINANCING TRANSACTIONS (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
Schedule of Future minimum principle payments | Minimum future lease payments for assets under capital leases as of June 30, 2019 are as follows: For the year ending June 30, 2020 $ 493,000 2021 492,000 2022 482,000 2023 182,000 Total minimum lease payments 1,649,000 Less interest on capital lease (163,000) Present value of future minimum lease payments $ 1,486,000 |
Notes Payable, Other Payables [Member] | |
Schedule of Minimum future lease payments | Future minimum principal payments for all related party and other financing transactions are as follows: For the year ending June 30, 2020 $ 4,005,000 2021 1,006,000 2022 1,022,000 2023 744,000 2024 567,000 Thereafter 2,388,000 $ 9,732,000 |
MORTGAGE NOTES PAYABLE (Tables)
MORTGAGE NOTES PAYABLE (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
MORTGAGE NOTES PAYABLE | |
Schedule of mortgage note payable | Each mortgage notes payable is secured by real estate or the Hotel. As of June 30, 2019 and 2018, the mortgage notes payables are summarized as follows: As of June 30, 2019 Number Note Note Property of Units Origination Date Maturity Date Mortgage Balance Interest Rate SF Hotel 544 rooms December January $ 93,746,000 5.28 % SF Hotel 544 rooms December January 20,000,000 9.75 % Mortgage notes payable - Hotel 113,746,000 Debt issuance costs (659,000) Total mortgage notes payable - Hotel $ 113,087,000 Florence 157 March April $ 3,222,000 3.87 % Las Colinas 358 November December 16,974,000 3.73 % Morris County 151 July August 8,737,000 3.51 % Morris County 151 June August 2,512,000 4.51 % St. Louis 264 May May 5,365,000 4.05 % Los Angeles 4 September September 343,000 3.75 % Los Angeles 2 September September 347,000 3.75 % Los Angeles 1 August September 373,000 3.75 % Los Angeles 31 November December 4,927,000 4.85 % Los Angeles 30 August September 5,765,000 5.97 % Los Angeles 14 April March 1,632,000 5.89 % Los Angeles 12 June June 2,172,000 3.59 % Los Angeles 9 April May 1,303,000 5.60 % Los Angeles 9 April March 1,112,000 5.89 % Los Angeles 8 July July 440,000 3.75 % Los Angeles 7 August September 846,000 3.75 % Los Angeles 4 August September 579,000 3.75 % Los Angeles 1 September September 399,000 3.75 % Los Angeles 1 September October 990,000 4.75 % Los Angeles Office April January 806,000 4.91 % Mortgage notes payable - real estate 58,844,000 Debt issuance costs (273,000) Total mortgage notes payable - real estate $ 58,571,000 As of June 30, 2018 Number Note Note Property of Units Origination Date Maturity Date Mortgage Balance Interest Rate SF Hotel 544 rooms December January $ 95,018,000 5.28 % SF Hotel 544 rooms December January 20,000,000 9.75 % Mortgage notes payable - Hotel 115,018,000 Debt issuance costs (646,000) Total mortgage notes payable - Hotel $ 114,372,000 Florence 157 March April $ 3,291,000 3.87 % Las Colinas 358 November December 17,404,000 3.73 % Morris County 151 July August 9,068,000 3.51 % Morris County 151 June August 2,563,000 4.51 % St. Louis 264 May May 5,491,000 4.05 % Los Angeles 4 September September 352,000 3.75 % Los Angeles 2 September September 356,000 3.75 % Los Angeles 1 August September 383,000 3.75 % Los Angeles 31 November December 5,048,000 4.85 % Los Angeles 30 August September 5,907,000 5.97 % Los Angeles 27 November December 2,843,000 4.85 % Los Angeles 14 April March 1,665,000 5.89 % Los Angeles 12 June June 2,218,000 3.59 % Los Angeles 9 April May 1,331,000 5.60 % Los Angeles 9 April March 1,135,000 5.89 % Los Angeles 8 July July 451,000 3.75 % Los Angeles 7 August September 868,000 3.75 % Los Angeles 4 August September 594,000 3.75 % Los Angeles 1 September September 409,000 3.75 % Los Angeles 1 August August 1,000,000 5.75 % Los Angeles Office April January 842,000 4.55 % Mortgage notes payable - real estate 63,219,000 Debt issuance costs (346,000) Total mortgage notes payable - real estate $ 62,873,000 |
Schedule of future minimum payment for mortgage notes payable | Future minimum payments for all mortgage notes payable are as follows: For the year ending June 30, 2020 $ 3,054,000 2021 12,483,000 2022 3,095,000 2023 37,812,000 2024 107,656,000 Thereafter 8,489,000 $ 172,589,000 |
INCOME TAXES (Tables)
INCOME TAXES (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
INCOME TAXES | |
Schedule of Company's income tax expense | The provision for the Company’s income tax expense is comprised of the following: For the years ended June 30, 2019 2018 Federal Current tax (expense) benefit $ (1,387,000) $ 1,455,000 Deferred tax benefit (expense) 2,563,000 (3,567,000) 1,176,000 (2,112,000) State Current tax expense (25,000) (227,000) Deferred tax expense (850,000) (717,000) (875,000) (944,000) Income Tax Benefit (expense) $ 301,000 $ (3,056,000) |
Schedule of Effective income tax rate reconciliation | The provision for income taxes differs from the amount of income tax computed by applying the federal statutory income tax rate to income before taxes as a result of the following differences: For the years ended June 30, 2019 2018 Statutory federal tax rate $ (457,000) $ (2,218,000) State income taxes, net of federal tax benefit (972,000) (623,000) Dividend received deduction 16,000 24,000 Valuation allowance 2,158,000 (330,000) Basis difference in investments 815,000 — Carryback tax payable (1,140,000) — Other (119,000) 91,000 $ 301,000 $ (3,056,000) |
Schedule of Deferred tax assets and liabilities | The components of the deferred tax asset and liabilities are as follows: June 30, 2019 June 30, 2018 Deferred tax assets: Net operating loss carryforwards $ 6,810,000 $ 7,413,000 Capital loss carryforwards 1,283,000 1,132,000 Investment impairment reserve 1,295,000 1,276,000 Accruals and reserves 1,095,000 766,000 Interest expense 162,000 — Tax credits 619,000 733,000 Unrealized loss on marketable securities 547,000 — Other 231,000 190,000 Valuation allowance (524,000) (2,610,000) 11,518,000 8,900,000 Deferred tax liabilities: Equity earnings (3,188,000) (2,564,000) Deferred gains on real estate sale and depreciation (6,844,000) (5,638,000) Unrealized gains on marketable securities — (765,000) State taxes (18,000) (178,000) (10,050,000) (9,145,000) Net deferred tax asset (liability) $ 1,468,000 $ (245,000) |
Schedule of Net operating losses (NOLs) | As of June 30, 2019, the Company had estimated net operating losses (NOLs) of $25,447,000 and $16,583,000 for federal and state purposes, respectively. Below is the break-down of the NOLs for Intergroup, Santa Fe and Portsmouth. The carryforward expires in varying amounts through the year 2037. Federal State InterGroup $ — $ — Santa Fe 9,735,000 3,913,000 Portsmouth 15,712,000 12,670,000 $ 25,447,000 $ 16,583,000 |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
SEGMENT INFORMATION | |
Schedule of Segment reporting information | Loss from investments consists of net investment loss, dividend and interest income and investment related expenses. As of and for the year Hotel Real Estate Investment ended June 30, 2019 Operations Operations Transactions Other Total Revenues $ 59,881,000 $ 14,872,000 $ — $ — $ 74,753,000 Segment operating expenses (44,466,000) (7,810,000) — (2,346,000) (54,622,000) Segment income (loss) from operations 15,415,000 7,062,000 — (2,346,000) 20,131,000 Interest expense - mortgage (7,234,000) (2,554,000) — — (9,788,000) Loss on disposal of assets (398,000) — — — (398,000) Depreciation and amortization expense (2,506,000) (2,429,000) — — (4,935,000) Loss from investments — — (2,497,000) — (2,497,000) Income tax benefit — — — 301,000 301,000 Net income (loss) $ 5,277,000 $ 2,079,000 $ (2,497,000) $ (2,045,000) $ 2,814,000 Total assets $ 62,148,000 $ 51,773,000 $ 10,308,000 $ 6,650,000 $ 130,879,000 As of and for the year Hotel Real Estate Investment ended June 30, 2018 Operations Operations Transactions Other Total Revenues $ 57,099,000 $ 14,480,000 $ — $ — $ 71,579,000 Segment operating expenses (40,103,000) (7,579,000) — (3,053,000) (50,735,000) Segment income (loss) from operations 16,996,000 6,901,000 — (3,053,000) 20,844,000 Interest expense - mortgage (7,237,000) (2,530,000) — — (9,767,000) Recovery of legal settlement costs 5,775,000 5,775,000 Depreciation and amortization expense (2,707,000) (2,347,000) — — (5,054,000) Loss from investments — — (2,929,000) — (2,929,000) Income tax expense — — — (3,056,000) (3,056,000) Net income (loss) $ 12,827,000 $ 2,024,000 $ (2,929,000) $ (6,109,000) $ 5,813,000 Total assets $ 58,019,000 $ 53,369,000 $ 14,654,000 $ 5,638,000 $ 131,680,000 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Tables) | 12 Months Ended |
Jun. 30, 2019 | |
STOCK-BASED COMPENSATION PLANS | |
Schedule of Stock option activity | The following table summarizes the stock options activity from July 1, 2017 through June 30, 2019: Number of Weighted Average Weighted Average Aggregate Shares Exercise Price Remaining Life Intrinsic Value Outstanding at July 1, 2017 368,000 $ 17.21 5.17 years $ 3,046,000 Granted — — Exercised — — Forfeited — — Exchanged — — Outstanding at June 30, 2018 368,000 $ 17.21 4.17 years $ 3,505,000 Exercisable at June 30, 2018 318,000 $ 16.47 3.79 years $ 3,257,000 Vested and Expected to vest at June 30, 2018 368,000 $ 17.21 4.17 years $ 3,505,000 Outstanding at July 1, 2018 368,000 $ 17.21 4.17 years $ 3,505,000 Granted — — Exercised (26,805) 20.52 Forfeited — — Exchanged — — Outstanding at June 30, 2019 341,195 $ 16.95 3.07 years $ 4,680,000 Exercisable at June 30, 2019 330,395 $ 16.62 2.92 years $ 4,643,000 Vested and Expected to vest at June 30, 2019 341,195 $ 16.95 3.07 years $ 4,680,000 |
BUSINESS AND SIGNIFICANT ACCO_3
BUSINESS AND SIGNIFICANT ACCOUNTING POLICIES AND PRACTICES: (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Allowance For Impairment Losses | $ 6,367,000 | $ 6,269,000 |
Other than Temporary Impairment Losses, Investments | 98,000 | 200,000 |
Advertising Expense | 282,000 | 302,000 |
Key Money Incentive Advance To Related Party | 2,000,000 | 2,000,000 |
Due from Related Parties | 2,000,000 | |
Unamortized Debt Issuance Expense | $ 1,896,000 | $ 2,000,000 |
Treasury Stock, Shares, Acquired | 33,601 | 25,527 |
Effective Income Tax Rate Reconciliation, Percent | 21.00% | 28.00% |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | $ 404,000 | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% |
Intergroup [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Subsidiary of Limited Liability Company or Limited Partnership, Ownership Interest | 93.30% | |
Scenario, Plan [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Effective Income Tax Rate Reconciliation, Percent | 21.00% | |
Portsmouth [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Equity Method Investment, Ownership Percentage | 68.80% | |
Portsmouth [Member] | Intergroup [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Noncontrolling Interest, Ownership Percentage by Parent | 13.40% | |
Franchise Fees [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Other Assets Amortization Period | 15 years | |
Maximum [Member] | Building Improvements [Member] | Hotel Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 39 years | |
Maximum [Member] | Furniture and Fixtures [Member] | Hotel Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 7 years | |
Maximum [Member] | Building and Building Improvements [Member] | Real Estate Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 40 years | |
Maximum [Member] | Equipment [Member] | Real Estate Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 10 years | |
Minimum [Member] | Building Improvements [Member] | Hotel Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Minimum [Member] | Furniture and Fixtures [Member] | Hotel Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 3 years | |
Minimum [Member] | Building and Building Improvements [Member] | Real Estate Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Minimum [Member] | Equipment [Member] | Real Estate Operations [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Property, Plant and Equipment, Useful Life | 5 years | |
Santa Fe [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Business Acquisition, Percentage of Voting Interests Acquired | 86.10% | |
Percentage Of Voting Shares In Common Stock | 4.00% |
REVENUE (Details)
REVENUE (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Hotel revenues: | ||
Revenues | $ 74,753,000 | $ 71,579,000 |
Hotel Rooms [Member] | ||
Hotel revenues: | ||
Revenues | 51,243,000 | 46,475,000 |
Food and Beverage [Member] | ||
Hotel revenues: | ||
Revenues | 5,353,000 | 7,222,000 |
Garage [Member] | ||
Hotel revenues: | ||
Revenues | 2,875,000 | 3,011,000 |
Other Operating Departments [Member] | ||
Hotel revenues: | ||
Revenues | 410,000 | 391,000 |
Hotel Operations [Member] | ||
Hotel revenues: | ||
Revenues | $ 59,881,000 | $ 57,099,000 |
REVENUE - Additional Informatio
REVENUE - Additional Information (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
REVENUE | ||
Contract with Customer, Liability | $ 1,215,000 | $ 571,000 |
Contract with Customer, Liability, Revenue Recognized | $ 563,000 |
INVESTMENT IN HOTEL, NET (Detai
INVESTMENT IN HOTEL, NET (Details) - Hotel Operations [Member] - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
Property, Plant and Equipment [Line Items] | ||
Cost | $ 97,723,000 | $ 96,424,000 |
Accumulated Depreciation | (57,887,000) | (55,463,000) |
Net Book Value | 39,836,000 | 40,961,000 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 2,738,000 | 2,738,000 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | 2,738,000 | 2,738,000 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 31,106,000 | 29,350,000 |
Accumulated Depreciation | (26,877,000) | (25,876,000) |
Net Book Value | 4,229,000 | 3,474,000 |
Building Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 63,879,000 | 64,336,000 |
Accumulated Depreciation | (31,010,000) | (29,587,000) |
Net Book Value | $ 32,869,000 | $ 34,749,000 |
INVESTMENT IN REAL ESTATE, NE_2
INVESTMENT IN REAL ESTATE, NET (Details) - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
Property, Plant and Equipment [Line Items] | ||
Investment in real estate, net | $ 51,773,000 | $ 53,369,000 |
Real Estate Operations [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Accumulated depreciation | (41,629,000) | (39,200,000) |
Real Estate Operations [Member] | Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 25,033,000 | 25,033,000 |
Real Estate Operations [Member] | Building Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | $ 68,369,000 | $ 67,536,000 |
INVESTMENT IN MARKETABLE SECU_3
INVESTMENT IN MARKETABLE SECURITIES - Trading securities (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Debt and Equity Securities, FV-NI [Line Items] | ||
Net Unrealized Loss | $ (927,000) | $ 3,598,000 |
Fair Value | 9,696,000 | 13,841,000 |
Corporate Equities [Member] | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Cost | 19,204,000 | 22,388,000 |
Gross Unrealized Gain | 1,753,000 | 2,450,000 |
Gross Unrealized Loss | (11,261,000) | (10,997,000) |
Net Unrealized Loss | (9,508,000) | (8,547,000) |
Fair Value | $ 9,696,000 | $ 13,841,000 |
INVESTMENT IN MARKETABLE SECU_4
INVESTMENT IN MARKETABLE SECURITIES - Net loss on marketable securities (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
INVESTMENT IN MARKETABLE SECURITIES | ||
Realized loss on marketable securities related to Comstock | $ 0 | $ (6,007,000) |
Realized (loss) gain on marketable securities | (806,000) | 632,000 |
Unrealized loss on marketable securities related to Comstock | (254,000) | (2,337,000) |
Net unrealized loss (gain) on marketable securities | (673,000) | 5,935,000 |
Net loss on marketable securities | $ (1,733,000) | $ (1,777,000) |
INVESTMENT IN MARKETABLE SECU_5
INVESTMENT IN MARKETABLE SECURITIES - Additional information (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Debt and Equity Securities, FV-NI [Line Items] | ||
Trading Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss | $ 11,088,000 | $ 10,819,000 |
Percentage Of Investment Marketable Securities | 7.00% | 7.00% |
Comstock Mining Inc [Member] | ||
Debt and Equity Securities, FV-NI [Line Items] | ||
Trading Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss | $ 10,900,000 | $ 10,646,000 |
OTHER INVESTMENTS, NET (Details
OTHER INVESTMENTS, NET (Details) - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
Other Investment [Line Items] | ||
Other investments, net | $ 612,000 | $ 813,000 |
Private Equity Hedge Fund At Cost [Member] | ||
Other Investment [Line Items] | ||
Other investments, net | 376,000 | 554,000 |
Other Investments [Member] | ||
Other Investment [Line Items] | ||
Other investments, net | $ 236,000 | $ 259,000 |
FAIR VALUE MEASUREMENTS - Recur
FAIR VALUE MEASUREMENTS - Recurring basis (Details) - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
Assets: | ||
Investment in marketable securities | $ 9,696,000 | $ 13,841,000 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | ||
Assets: | ||
Investment in marketable securities | 9,696,000 | 13,841,000 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | REITs and real estate companies [Member] | ||
Assets: | ||
Investment in marketable securities | 3,069,000 | 4,300,000 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Consumer Cyclical [Member] | ||
Assets: | ||
Investment in marketable securities | 1,448,000 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Corporate bonds [Member] | ||
Assets: | ||
Investment in marketable securities | 1,420,000 | 2,282,000 |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Technology [Member] | ||
Assets: | ||
Investment in marketable securities | 1,813,000 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Healthcare [Member] | ||
Assets: | ||
Investment in marketable securities | 1,777,000 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Communications [Member] | ||
Assets: | ||
Investment in marketable securities | 1,071,000 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Financial Services [Member] | ||
Assets: | ||
Investment in marketable securities | 951,000 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Energy [Member] | ||
Assets: | ||
Investment in marketable securities | 950,000 | |
Fair Value, Inputs, Level 1 [Member] | Fair Value, Measurements, Recurring [Member] | Other [Member] | ||
Assets: | ||
Investment in marketable securities | $ 1,858,000 | $ 2,598,000 |
FAIR VALUE MEASUREMENTS - Non-r
FAIR VALUE MEASUREMENTS - Non-recurring basis (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Net loss | $ (98,000) | $ (242,000) |
Other Investments [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other non-marketable investments | 612,000 | 813,000 |
Other Investments [Member] | Fair Value, Inputs, Level 3 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other non-marketable investments | $ 612,000 | $ 813,000 |
FAIR VALUE MEASUREMENTS - Addit
FAIR VALUE MEASUREMENTS - Additional information (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
FAIR VALUE MEASUREMENTS | ||
Proceeds from Sale of Other Investments | $ 103,000 | $ 131,000 |
OTHER ASSETS, NET (Details)
OTHER ASSETS, NET (Details) - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
OTHER ASSETS, NET | ||
Accounts receivable, net | $ 852,000 | $ 1,843,000 |
Prepaid expenses | 747,000 | 490,000 |
Miscellaneous assets, net | 763,000 | 1,159,000 |
Tax Refund Receivable | 1,693,000 | |
Total other assets | $ 2,362,000 | $ 5,185,000 |
OTHER ASSETS, NET - Additional
OTHER ASSETS, NET - Additional information (Details) - USD ($) | 1 Months Ended | 12 Months Ended | |
Mar. 31, 2019 | Jun. 30, 2019 | Jun. 30, 2018 | |
Trading Securities, Realized Loss | $ 0 | $ 6,007,000 | |
Tax Refund Receivable | 1,693,000 | ||
Amount of income tax refund received | $ 1,860,000 | ||
Federal [Member] | |||
Tax Refund Receivable | $ 1,860,000 |
RELATED PARTY AND OTHER FINAN_3
RELATED PARTY AND OTHER FINANCING TRANSACTIONS - Minimum future lease payments (Details) | Jun. 30, 2019USD ($) |
Related Party And Other Notes Payable Abstract [Abstract] | |
2020 | $ 493,000 |
2021 | 492,000 |
2022 | 482,000 |
2023 | 182,000 |
Total minimum lease payments | 1,649,000 |
Less interest on capital lease | (163,000) |
Present value of future minimum lease payments | $ 1,486,000 |
RELATED PARTY AND OTHER FINAN_4
RELATED PARTY AND OTHER FINANCING TRANSACTIONS - Future minimum principle payments (Details) - Related Party Debt And Other Notes Payable [Member] | Jun. 30, 2019USD ($) |
2020 | $ 4,005,000 |
2021 | 1,006,000 |
2022 | 1,022,000 |
2023 | 744,000 |
2024 | 567,000 |
Thereafter | 2,388,000 |
Long-term Debt | $ 9,732,000 |
RELATED PARTY AND OTHER FINAN_5
RELATED PARTY AND OTHER FINANCING TRANSACTIONS - Additional information (Details) - USD ($) | Jul. 31, 2018 | Jul. 31, 2019 | Aug. 31, 2018 | Jul. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Key Money Incentive Advance To Related Party | $ 2,000,000 | $ 2,000,000 | ||||
Management Services Agreement Term | 10 years | |||||
Unamortized Debt Issuance Expense | $ 1,896,000 | 2,000,000 | ||||
Capital Lease Obligations | $ 1,486,000 | 1,355,000 | ||||
Long Term Debt Expiration Terms | These capital leases expire in various years through 2023 at rates ranging from 5.77% to 6.25% per annum. | |||||
Other Notes Payable | $ 5,261,000 | 5,735,000 | ||||
Amount drawn | 2,985,000 | 0 | ||||
CIBC Bank, USA [Member] | Revolving Credit Facility [Member] | ||||||
Maximum borrowing capacity | $ 5,000,000 | $ 5,000,000 | ||||
Amount drawn | $ 2,969,000 | $ 1,005,000 | ||||
Outstanding balance | 2,985,000 | |||||
CIBC Bank, USA [Member] | Revolving Credit Facility [Member] | Subsequent Event [Member] | ||||||
Maximum borrowing capacity | $ 5,000,000 | |||||
Increase in maximum borrowing capacity | $ 3,000,000 | |||||
CIBC Bank, USA [Member] | Revolving Credit Facility [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||||
Spread on variable rate (as a percent) | 3.00% | |||||
Interest Free Development Incentive Note [Member] | ||||||
Notes Reduction | 316,000 | 316,000 | ||||
Other Notes Payable | $ 3,325,000 | $ 3,642,000 |
MORTGAGE NOTES PAYABLE - Mortga
MORTGAGE NOTES PAYABLE - Mortgage note payable (Details) | 12 Months Ended | |
Jun. 30, 2019USD ($) | Jun. 30, 2018USD ($) | |
Debt Disclosure [Line Items] | ||
Total mortgage notes payable - Hotel | $ 113,087,000 | $ 114,372,000 |
Total mortgage notes payable - real estate | 58,571,000 | 62,873,000 |
Mortgage Notes Payable Real Estate [Member] | ||
Debt Disclosure [Line Items] | ||
Mortgage notes payable - real estate | 58,844,000 | 63,219,000 |
Debt issuance costs | (273,000) | (346,000) |
Total mortgage notes payable - real estate | 58,571,000 | 62,873,000 |
Mortgage Notes Payable Hotel [Member] | ||
Debt Disclosure [Line Items] | ||
Mortgage notes payable - Hotel | 113,746,000 | 115,018,000 |
Total mortgage notes payable - Hotel | 113,087,000 | 114,372,000 |
Debt issuance costs | $ (659,000) | $ (646,000) |
5.28% SF Hotel [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 544 | 544 |
Origination Date | December 2013 | December 2013 |
Maturity Date | January 2024 | January 2024 |
Interest Rate | 5.28% | 5.28% |
Mortgage notes payable - Hotel | $ 93,746,000 | $ 95,018,000 |
9.75% SF Hotel [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 544 | 544 |
Origination Date | December 2013 | December 2013 |
Maturity Date | January 2024 | January 2024 |
Interest Rate | 9.75% | 9.75% |
Mortgage notes payable - Hotel | $ 20,000,000 | $ 20,000,000 |
3.87% Florence [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 157 | 157 |
Origination Date | March 2015 | March 2015 |
Maturity Date | April 2025 | April 2025 |
Interest Rate | 3.87% | 3.87% |
Mortgage notes payable - real estate | $ 3,222,000 | $ 3,291,000 |
3.73% Las Colinas [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 358 | 358 |
Origination Date | November 2012 | November 2012 |
Maturity Date | December 2022 | December 2022 |
Interest Rate | 3.73% | 3.73% |
Mortgage notes payable - real estate | $ 16,974,000 | $ 17,404,000 |
3.51% Morris County [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 151 | 151 |
Origination Date | July 2012 | July 2012 |
Maturity Date | August 2022 | August 2022 |
Interest Rate | 3.51% | 3.51% |
Mortgage notes payable - real estate | $ 8,737,000 | $ 9,068,000 |
4.51% Morris County [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 151 | 151 |
Origination Date | June 2014 | June 2014 |
Maturity Date | August 2022 | August 2022 |
Interest Rate | 4.51% | 4.51% |
Mortgage notes payable - real estate | $ 2,512,000 | $ 2,563,000 |
4.05% St. Louis [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 264 | 264 |
Origination Date | May 2013 | May 2013 |
Maturity Date | May 2023 | May 2023 |
Interest Rate | 4.05% | 4.05% |
Mortgage notes payable - real estate | $ 5,365,000 | $ 5,491,000 |
3.75% Los Angeles One [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 4 | 4 |
Origination Date | September 2012 | September 2012 |
Maturity Date | September 2042 | September 2042 |
Interest Rate | 3.75% | 3.75% |
Mortgage notes payable - real estate | $ 343,000 | $ 352,000 |
3.75% Los Angeles Two [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 2 | 2 |
Origination Date | September 2012 | September 2012 |
Maturity Date | September 2042 | September 2042 |
Interest Rate | 3.75% | 3.75% |
Mortgage notes payable - real estate | $ 347,000 | $ 356,000 |
3.75% Los Angeles Three [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 1 | 1 |
Origination Date | August 2012 | August 2012 |
Maturity Date | September 2042 | September 2042 |
Interest Rate | 3.75% | 3.75% |
Mortgage notes payable - real estate | $ 373,000 | $ 383,000 |
4.85% Los Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 31 | 31 |
Origination Date | November 2010 | November 2010 |
Maturity Date | December 2020 | December 2020 |
Interest Rate | 4.85% | 4.85% |
Mortgage notes payable - real estate | $ 4,927,000 | $ 5,048,000 |
5.97% Los Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 30 | 30 |
Origination Date | August 2007 | August 2007 |
Maturity Date | September 2022 | September 2022 |
Interest Rate | 5.97% | 5.97% |
Mortgage notes payable - real estate | $ 5,765,000 | $ 5,907,000 |
4.85% Los Angeles Two [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 27 | |
Origination Date | November 2010 | |
Maturity Date | December 2020 | |
Interest Rate | 4.85% | |
Mortgage notes payable - real estate | $ 2,843,000 | |
5.89% Los Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 14 | 14 |
Origination Date | April 2011 | April 2011 |
Maturity Date | March 2021 | March 2021 |
Interest Rate | 5.89% | 5.89% |
Mortgage notes payable - real estate | $ 1,632,000 | $ 1,665,000 |
3.59% Los Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 12 | 12 |
Origination Date | June 2016 | June 2016 |
Maturity Date | June 2026 | June 2026 |
Interest Rate | 3.59% | 3.59% |
Mortgage notes payable - real estate | $ 2,172,000 | $ 2,218,000 |
5.6% Los Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 9 | 9 |
Origination Date | April 2011 | April 2011 |
Maturity Date | May 2021 | May 2021 |
Interest Rate | 5.60% | 5.60% |
Mortgage notes payable - real estate | $ 1,303,000 | $ 1,331,000 |
5.89% Los Angeles Two [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 9 | 9 |
Origination Date | April 2011 | April 2011 |
Maturity Date | March 2021 | March 2021 |
Interest Rate | 5.89% | 5.89% |
Mortgage notes payable - real estate | $ 1,112,000 | $ 1,135,000 |
3.75% Los Angeles Four [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 8 | 8 |
Origination Date | July 2013 | July 2013 |
Maturity Date | July 2043 | July 2043 |
Interest Rate | 3.75% | 3.75% |
Mortgage notes payable - real estate | $ 440,000 | $ 451,000 |
3.75% Los Angeles Five [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 7 | 7 |
Origination Date | August 2012 | August 2012 |
Maturity Date | September 2042 | September 2042 |
Interest Rate | 3.75% | 3.75% |
Mortgage notes payable - real estate | $ 846,000 | $ 868,000 |
3.75% Los Angeles Six [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 4 | 4 |
Origination Date | August 2012 | August 2012 |
Maturity Date | September 2042 | September 2042 |
Interest Rate | 3.75% | 3.75% |
Mortgage notes payable - real estate | $ 579,000 | $ 594,000 |
3.75% Los Angeles Seven [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 1 | 1 |
Origination Date | September 2012 | September 2012 |
Maturity Date | September 2042 | September 2042 |
Interest Rate | 3.75% | 3.75% |
Mortgage notes payable - real estate | $ 399,000 | $ 409,000 |
4.75% Los Angeles[Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 1 | |
Origination Date | August 2016 | |
Maturity Date | August 2018 | |
Interest Rate | 4.75% | |
Mortgage notes payable - real estate | $ 990,000 | |
4.55% Loss Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 1 | |
Origination Date | April 2016 | |
Maturity Date | January 2021 | |
Interest Rate | 4.55% | |
Mortgage notes payable - real estate | $ 842,000 | |
4.91% Los Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 1 | |
Origination Date | April 2016 | |
Maturity Date | January 2021 | |
Interest Rate | 4.91% | |
Mortgage notes payable - real estate | $ 806,000 | |
5.75% Los Angeles [Member] | ||
Debt Disclosure [Line Items] | ||
Number of Units | 1 | |
Origination Date | August 2016 | |
Maturity Date | August 2018 | |
Interest Rate | 5.75% | |
Mortgage notes payable - real estate | $ 1,000,000 |
MORTGAGE NOTES PAYABLE - Future
MORTGAGE NOTES PAYABLE - Future minimum payments (Details) - Mortgage Notes [Member] | Jun. 30, 2019USD ($) |
Mortgage Notes Payable [Line Items] | |
2020 | $ 3,054,000 |
2021 | 12,483,000 |
2022 | 3,095,000 |
2023 | 37,812,000 |
2024 | 107,656,000 |
Thereafter | 8,489,000 |
Long-term Debt | $ 172,589,000 |
MORTGAGE NOTES PAYABLE - Additi
MORTGAGE NOTES PAYABLE - Additional information (Details) - USD ($) | Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Sep. 30, 2018 | Aug. 31, 2018 | Jun. 30, 2016 | Apr. 30, 2016 | Jun. 30, 2019 | Jun. 30, 2018 |
Mortgage Notes Payable [Line Items] | |||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Periodic Payment Terms, Description | The term of the loan is 10 years with interest only due in the first three years and principal and interest on the remaining seven years of the loan based on a thirty-year amortization schedule. The Mortgage Loan also requires payments for impounds related to property tax, insurance and capital improvement reserves. | ||||||||
Proceeds from Lines of Credit | $ 2,985,000 | $ 0 | |||||||
Revolving Credit Facility [Member] | CIBC Bank, USA [Member] | |||||||||
Mortgage Notes Payable [Line Items] | |||||||||
Proceeds from Lines of Credit | $ 2,969,000 | $ 1,005,000 | |||||||
Mortgage Loans [Member] | |||||||||
Mortgage Notes Payable [Line Items] | |||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Face Amount of Mortgages | $ 97,000,000 | ||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Interest Rate | 5.275% | ||||||||
Mezzanine Loan [Member] | |||||||||
Mortgage Notes Payable [Line Items] | |||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Face Amount of Mortgages | $ 20,000,000 | ||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Interest Rate | 9.75% | ||||||||
Maturity Date | January 1, 2024 | ||||||||
Mezzanine Loan [Member] | Subsequent Event [Member] | |||||||||
Mortgage Notes Payable [Line Items] | |||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Face Amount of Mortgages | $ 20,000,000 | $ 20,000,000 | |||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Interest Rate | 7.25% | 7.25% | |||||||
Commercial Property [Member] | |||||||||
Mortgage Notes Payable [Line Items] | |||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Face Amount of Mortgages | $ 923,000 | ||||||||
Maturity Date | January 2021 | ||||||||
Derivative, Variable Interest Rate | 4.22% | ||||||||
Derivative, Fixed Interest Rate | 3.99% | ||||||||
12-Unit Apartment Complex [Member] | |||||||||
Mortgage Notes Payable [Line Items] | |||||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Face Amount of Mortgages | $ 995,000 | $ 1,929,000 | |||||||
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate, Interest Rate | 4.75% | 3.59% | |||||||
Maturity Date | October 2048 | June 2026 | |||||||
Proceeds from Lines of Credit | $ 1,000,000 | $ 2,300,000 |
MANAGEMENT AGREEMENTS (Details)
MANAGEMENT AGREEMENTS (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Management Agreement [Line Items] | ||
Management Agreement Term | 10 years | |
Unamortized Debt Issuance Expense | $ 1,896,000 | $ 2,000,000 |
Key Money Incentive Advance To Related Party | 2,000,000 | 2,000,000 |
Interstate Management Company, LLC [Member] | ||
Management Agreement [Line Items] | ||
Management Fee Expense | $ 1,206,000 | $ 957,000 |
CONCENTRATION OF CREDIT RISK (D
CONCENTRATION OF CREDIT RISK (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Concentration Risk [Line Items] | ||
Accounts Receivable, Net | $ 852,000 | $ 1,843,000 |
Hotel Operations [Member] | Accounts Receivable [Member] | ||
Concentration Risk [Line Items] | ||
Accounts Receivable, Net | $ 272,000 | |
Concentration Risk, Percentage | 32.00% | |
Hotel Operations [Member] | Accounts Receivable [Member] | Two Customer [Member] | ||
Concentration Risk [Line Items] | ||
Accounts Receivable, Net | $ 572,000 | |
Concentration Risk, Percentage | 32.00% |
INCOME TAXES - Company's income
INCOME TAXES - Company's income tax expense (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Federal | ||
Current tax (expense) benefit | $ (1,387,000) | $ 1,455,000 |
Deferred tax benefit (expense) | 2,563,000 | (3,567,000) |
Federal Income Tax (Expense) Benefit, Continuing Operations, Total | 1,176,000 | (2,112,000) |
State | ||
Current tax expense | (25,000) | (227,000) |
Deferred tax expense | (850,000) | (717,000) |
State and Local Income Tax (Expense) Benefit, Continuing Operations, Total | (875,000) | (944,000) |
Income Tax Benefit (expense) | $ 301,000 | $ (3,056,000) |
INCOME TAXES - Effective income
INCOME TAXES - Effective income tax rate reconciliation (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
INCOME TAXES | ||
Statutory federal tax rate | $ (457,000) | $ (2,218,000) |
State income taxes, net of federal tax benefit | (972,000) | (623,000) |
Dividend received deduction | 16,000 | 24,000 |
Valuation allowance | 2,158,000 | (330,000) |
Basis difference in investments | 815,000 | 0 |
Carryback tax payable | (1,140,000) | 0 |
Other | (119,000) | 91,000 |
Income Tax Expense (Benefit), Continuing Operations, Discontinued Operations, Extraordinary Items | $ 301,000 | $ (3,056,000) |
INCOME TAXES - Deferred tax ass
INCOME TAXES - Deferred tax assets and liabilities (Details) - USD ($) | Jun. 30, 2019 | Jun. 30, 2018 |
Deferred tax assets: | ||
Net operating loss carryforwards | $ 6,810,000 | $ 7,413,000 |
Capital loss carryforwards | 1,283,000 | 1,132,000 |
Investment impairment reserve | 1,295,000 | 1,276,000 |
Accruals and reserves | 1,095,000 | 766,000 |
Interest expense | 162,000 | 0 |
Tax credits | 619,000 | 733,000 |
Unrealized loss on marketable securities | 547,000 | 0 |
Other | 231,000 | 190,000 |
Valuation allowance | (524,000) | (2,610,000) |
Deferred Tax Assets, Net of Valuation Allowance, Total | 11,518,000 | 8,900,000 |
Deferred tax liabilities: | ||
Equity earnings | (3,188,000) | (2,564,000) |
Deferred gains on real estate sale and depreciation | (6,844,000) | (5,638,000) |
Unrealized gains on marketable securities | 0 | (765,000) |
State taxes | (18,000) | (178,000) |
Deferred Tax Liabilities, Gross | (10,050,000) | (9,145,000) |
Net deferred tax asset (liability) | $ 1,468,000 | |
Net deferred tax asset (liability) | $ (245,000) |
INCOME TAXES - Net operating lo
INCOME TAXES - Net operating losses (Details) | Jun. 30, 2019USD ($) |
Income Tax Disclosure [Line Items] | |
Federal | $ 25,447,000 |
State | 16,583,000 |
Intergroup [Member] | |
Income Tax Disclosure [Line Items] | |
Federal | 0 |
State | 0 |
Santa Fe [Member] | |
Income Tax Disclosure [Line Items] | |
Federal | 9,735,000 |
State | 3,913,000 |
Portsmouth [Member] | |
Income Tax Disclosure [Line Items] | |
Federal | 15,712,000 |
State | $ 12,670,000 |
INCOME TAXES - Additional infor
INCOME TAXES - Additional information (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Income Tax Disclosure [Line Items] | ||
Deferred Tax Assets, Operating Loss Carryforwards, Domestic | $ 25,447,000 | |
Deferred Tax Assets, Operating Loss Carryforwards, State and Local | $ 16,583,000 | |
Effective Income Tax Rate Reconciliation, Percent | 21.00% | 28.00% |
Effective Income Tax Rate Reconciliation, Change in Enacted Tax Rate, Amount | $ 404,000 | |
Effective Income Tax Rate Reconciliation, at Federal Statutory Income Tax Rate, Percent | 21.00% | 21.00% |
Decrease in valuation allowance | $ 2,086,000 | $ 778,000 |
Scenario, Plan [Member] | ||
Income Tax Disclosure [Line Items] | ||
Effective Income Tax Rate Reconciliation, Percent | 21.00% |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) | 12 Months Ended | |
Jun. 30, 2019 | Jun. 30, 2018 | |
Segment Reporting Information [Line Items] | ||
Revenues | $ 74,753,000 | $ 71,579,000 |
Segment income (loss) from operations | 15,196,000 | 21,565,000 |
Interest expense - mortgage | (9,788,000) | (9,767,000) |
Loss on disposal of assets | (398,000) | 0 |
Depreciation and amortization expense | (4,935,000) | (5,054,000) |
Income tax benefit (expense) | 301,000 | (3,056,000) |
Net income (loss) | 2,814,000 | 5,813,000 |
Total assets | 130,879,000 | 131,680,000 |
Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 74,753,000 | 71,579,000 |
Segment operating expenses | (54,622,000) | (50,735,000) |
Segment income (loss) from operations | 20,131,000 | 20,844,000 |
Interest expense - mortgage | (9,788,000) | (9,767,000) |
Loss on disposal of assets | (398,000) | |
Recovery of legal settlement costs | 5,775,000 | |
Depreciation and amortization expense | (4,935,000) | (5,054,000) |
Loss from investments | (2,497,000) | (2,929,000) |
Income tax benefit (expense) | 301,000 | (3,056,000) |
Net income (loss) | 2,814,000 | 5,813,000 |
Total assets | 130,879,000 | 131,680,000 |
Hotel Operations [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 59,881,000 | 57,099,000 |
Segment operating expenses | (44,466,000) | (40,103,000) |
Segment income (loss) from operations | 15,415,000 | 16,996,000 |
Interest expense - mortgage | (7,234,000) | (7,237,000) |
Loss on disposal of assets | (398,000) | |
Recovery of legal settlement costs | 5,775,000 | |
Depreciation and amortization expense | (2,506,000) | (2,707,000) |
Loss from investments | 0 | |
Income tax benefit (expense) | 0 | |
Net income (loss) | 5,277,000 | 12,827,000 |
Total assets | 62,148,000 | 58,019,000 |
Real Estate Operations [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 14,872,000 | 14,480,000 |
Segment operating expenses | (7,810,000) | (7,579,000) |
Segment income (loss) from operations | 7,062,000 | 6,901,000 |
Interest expense - mortgage | (2,554,000) | (2,530,000) |
Recovery of legal settlement costs | 0 | |
Depreciation and amortization expense | (2,429,000) | (2,347,000) |
Loss from investments | 0 | |
Income tax benefit (expense) | 0 | |
Net income (loss) | 2,079,000 | 2,024,000 |
Total assets | 51,773,000 | 53,369,000 |
Investment Transactions [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 0 | |
Segment operating expenses | 0 | |
Segment income (loss) from operations | 0 | |
Interest expense - mortgage | 0 | |
Recovery of legal settlement costs | 0 | |
Depreciation and amortization expense | 0 | |
Loss from investments | (2,497,000) | (2,929,000) |
Income tax benefit (expense) | 0 | |
Net income (loss) | (2,497,000) | (2,929,000) |
Total assets | 10,308,000 | 14,654,000 |
Other [Member] | Operating Segments [Member] | ||
Segment Reporting Information [Line Items] | ||
Revenues | 0 | |
Segment operating expenses | (2,346,000) | (3,053,000) |
Segment income (loss) from operations | (2,346,000) | (3,053,000) |
Interest expense - mortgage | 0 | |
Recovery of legal settlement costs | 0 | |
Depreciation and amortization expense | 0 | |
Loss from investments | 0 | |
Income tax benefit (expense) | 301,000 | (3,056,000) |
Net income (loss) | (2,045,000) | (6,109,000) |
Total assets | $ 6,650,000 | $ 5,638,000 |
STOCK-BASED COMPENSATION PLAN_2
STOCK-BASED COMPENSATION PLANS - Stock option activity (Details) - USD ($) | 12 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2017 | Feb. 29, 2012 | |
Stock Based Compensation [Line Items] | ||||
Granted, Number of Shares | 160,000 | |||
Vested and Expected to vest, Number of Shares | 90,000 | |||
Equity Option [Member] | ||||
Stock Based Compensation [Line Items] | ||||
Outstanding, Number of Shares | 368,000 | 368,000 | ||
Exercised, Number of Shares | (26,805) | |||
Outstanding, Number of Shares | 341,195 | 368,000 | 368,000 | |
Exercisable, Number of Shares | 330,395 | 318,000 | ||
Vested and Expected to vest, Number of Shares | 341,195 | 368,000 | ||
Outstanding, Weighted Average Exercise Price | $ 17.21 | $ 17.21 | ||
Exercised, Weighted Average Exercise Price | 20.52 | |||
Outstanding, Weighted Average Exercise Price | 16.95 | 17.21 | $ 17.21 | |
Exercisable, Weighted Average Exercise Price | 16.62 | 16.47 | ||
Vested and Expected to vest, Weighted Average Exercise Price | $ 16.95 | $ 17.21 | ||
Outstanding at Weighted Average Remaining Life | 3 years 26 days | 4 years 2 months 1 day | 5 years 2 months 1 day | |
Exercisable, Weighted Average Remaining Life | 2 years 11 months 1 day | 3 years 9 months 15 days | ||
Vested and Expected to vest, Weighted Average Remaining Life | 3 years 26 days | 4 years 2 months 1 day | ||
Outstanding, Aggregate Intrinsic Value | $ 4,680,000 | $ 3,505,000 | $ 3,046,000 | |
Exercisable, Aggregate Intrinsic Value | 4,643,000 | 3,257,000 | ||
Vested and Expected to vest, Aggregate Intrinsic Value | $ 4,680,000 | $ 3,505,000 |
STOCK-BASED COMPENSATION PLAN_3
STOCK-BASED COMPENSATION PLANS - Additional information (Details) - USD ($) | Mar. 16, 2010 | Dec. 31, 2018 | Mar. 31, 2017 | Feb. 29, 2012 | Mar. 16, 2010 | Feb. 24, 2010 | Feb. 18, 2009 | Jun. 30, 2019 | Jun. 30, 2018 |
Stock Based Compensation [Line Items] | |||||||||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs, Capitalized Amount | $ 76,000 | $ 184,000 | |||||||
Employee Service Share-based Compensation, Nonvested Awards, Compensation Cost Not yet Recognized | $ 44,000 | ||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award Award Vesting Period 1 | 2 years 8 months 1 day | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | 160,000 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award | 90,000 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 90,000 | ||||||||
Common Stock, Shares, Issued | 3,404,982 | 3,395,616 | |||||||
Incentive Stock [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 26,805 | ||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 20.52 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Date | Dec. 26, 2018 | ||||||||
2010 Incentive Plan [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share-Based Compensation Arrangement By Share-Based Payment Award Award Vesting Period 1 | 5 years | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 100,000 | 100,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Authorized | 400,000 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Date | Feb. 23, 2020 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Terms of Award | In accordance with the terms of the 2010 Incentive Plan, the exercise prices were based on 100% and 110%, respectively, | ||||||||
Share based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Increase Or More In Market Price | $ 2 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 20,000 | 20,000 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Per Share Weighted Average Price of Shares Purchased | $ 10.30 | $ 10.30 | |||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Rights | with 20% of the options vesting annually commencing on the first anniversary of the grant date. | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | ||||||||
2007 Stock Plan [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 18,000 | ||||||||
2008 Stock Plan [Member] | Restricted Stock Units (RSUs) [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | ||||||||
Common Stock, Capital Shares Reserved for Future Issuance | 200,000 | ||||||||
Non Employee Directors [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share Based Compensation By Share Based Payment Award Fair Market Value, Percentage | 100.00% | ||||||||
John V Winfield [Member] | 2010 Incentive Plan [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award | 100,000 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Per Share Weighted Average Price of Shares Purchased | $ 10.30 | $ 10.30 | |||||||
Chief Executive Officer [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Number | 133,195 | ||||||||
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price | $ 18.65 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Date | Dec. 26, 2023 | ||||||||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price | $ 19.77 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period | 26,805 | ||||||||
Common Stock, Shares, Issued | 17,439 | ||||||||
Stock Issued During Period, Shares, New Issues | 9,366 | ||||||||
Chief Executive Officer [Member] | Time Vesting Requirements [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Award Vesting Period | 5 years | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 18,000 | ||||||||
Chief Executive Officer [Member] | Market Based Vesting Requirement [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share based Compensation Arrangement By Share Based Payment Award Options Vested And Expected To Vest Increase Or More In Market Price | $ 2 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 18,000 | ||||||||
Vice President [Member] | 2010 Incentive Plan [Member] | |||||||||
Stock Based Compensation [Line Items] | |||||||||
Share Based Compensation Shares Authorized Under Stock Option Plans Exercise Price | $ 27.30 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award | 18,000 | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Vested and Expected to Vest, Outstanding, Number | 3,600 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details) | 12 Months Ended |
Jun. 30, 2019USD ($) | |
RELATED PARTY TRANSACTIONS | |
Payments to Acquire Limited Partnership Interests | $ 1,550,000 |
Management Fee Payable | $ 200,000 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) | 12 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | May 31, 2018 | |
COMMITMENTS AND CONTINGENCIES | |||
Franchise Agreements Expiry Period | 15 years | ||
Initial Franchise Fees | $ 4,100,000 | $ 3,800,000 | |
Reduction In Legal Expenses | 2,725,000 | ||
Recovery Of Legal Settlement Costs | $ 0 | $ 5,775,000 | |
Gain Contingency, Unrecorded Amount | $ 8,300,000 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) - USD ($) | Jul. 31, 2019 | Jul. 31, 2018 | Jul. 31, 2019 | Aug. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 |
Proceeds from Lines of Credit | $ 2,985,000 | $ 0 | ||||
Mezzanine Loan [Member] | ||||||
Amount of loan agreement | $ 20,000,000 | |||||
Interest rate (as a percent) | 9.75% | |||||
Revolving Credit Facility [Member] | CIBC Bank, USA [Member] | ||||||
Maximum borrowing capacity | $ 5,000,000 | |||||
Proceeds from Lines of Credit | $ 2,969,000 | $ 1,005,000 | ||||
Subsequent Event [Member] | Mezzanine Loan [Member] | ||||||
Amount of loan agreement | $ 20,000,000 | $ 20,000,000 | ||||
Interest rate (as a percent) | 7.25% | 7.25% | ||||
Subsequent Event [Member] | Revolving Credit Facility [Member] | CIBC Bank, USA [Member] | ||||||
Maximum borrowing capacity | $ 5,000,000 | $ 5,000,000 | ||||
Increase in maximum borrowing capacity | $ 3,000,000 |