Transcontinental Realty Investors (TCI) 10-Q 13 Aug 15 2015 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information - shares	6 Months Ended
	Jun. 30, 2015	Aug. 05, 2015
Document And Entity Information
Entity Registrant Name	TRANSCONTINENTAL REALTY INVESTORS INC
Entity Central Index Key	733,590
Document Type	10-Q
Document Period End Date	Jun. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity a Well-known Seasoned Issuer	No
Entity a Voluntary Filer	No
Entity's Reporting Status Current	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		8,717,767
Document Fiscal Period Focus	Q2
Document Fiscal Year Focus	2,015

CONSOLIDATED BALANCE SHEETS (Un

CONSOLIDATED BALANCE SHEETS (Unaudited) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Assets
Real estate, at cost	$ 899,769	$ 781,794
Real estate subject to sales contracts at cost, net of depreciation ($2,475 for 2015 and $2,300 for 2014)	20,402	20,395
Less accumulated depreciation	(127,760)	(113,068)
Total real estate	792,411	689,121
Notes and interest receivable
Performing (including $69,050 in 2015 and $77,853 in 2014 from related parties)	76,253	84,863
Non-performing	604	584
Less allowance for doubtful accounts (including $1,825 in 2015 and $1,825 in 2014 from related parties)	(1,990)	(1,990)
Total notes and interest receivable	74,867	83,457
Cash and cash equivalents	19,128	12,201
Restricted cash	52,066	48,238
Investments in unconsolidated joint ventures and investees	2,155	1,543
Receivable from related party	94,080	58,404
Other assets	33,287	37,441
Total assets	1,067,994	930,405
Liabilities:
Notes and interest payable	727,222	588,749
Notes related to real estate held for sale	910	1,552
Notes related to real estate subject to sales contracts	18,252	18,616
Deferred gain (from sales to related parties)	51,356	51,356
Accounts payable and other liabilities (including $2,652 in 2015 and $4,909 in 2014 to related parties)	37,010	36,684
Total Liabilities	834,750	696,957
Shareholders' equity:
Preferred stock, Series C: $0.01 par value, authorized 10,000,000 shares; issued and outstanding zero shares in 2015 and 2014 (liquidation preference $100 per share). Series D: $0.01 par value, authorized, issued and outstanding 100,000 shares in 2015 and 2014 (liquidation preference $100 per share)	1	1
Common stock, $0.01 par value, authorized 10,000,000 shares; issued 8,717,967 shares in 2015 and 2014; outstanding 8,717,767 shares in 2015 and 2014	87	87
Treasury stock at cost, 200 shares in 2015 and 2014	(2)	(2)
Paid-in capital	271,203	271,649
Retained earnings	(56,208)	(56,451)
Total Transcontinental Realty Investors, Inc. shareholders' equity	215,081	215,284
Non-controlling interest	18,163	18,164
Total shareholders' equity	233,244	233,448
Total liabilities and shareholders' equity	$ 1,067,994	$ 930,405

CONSOLIDATED BALANCE SHEETS (Pa

CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Depreciation of Real Estate subject to sales contracts at cost	$ 2,475	$ 2,300
Performing	76,253	84,863
Allowance for doubtful accounts	1,990	1,990
Accounts payable and other liabilities to related parties	$ 2,652	$ 4,909
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	8,717,967	8,717,967
Common stock, shares outstanding	8,717,767	8,717,767
Treasury stock, shares	200	200
Related Party [Member]
Performing	$ 69,050	$ 77,853
Allowance for doubtful accounts	$ 1,825	$ 1,825
Series C Preferred Stock [Member]
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	10,000,000	10,000,000
Preferred stock, liquidation preference per share	$ 100	$ 100
Series D Preferred Stock [Member]
Preferred stock, par value	$ 0.01	$ 0.01
Preferred stock, shares authorized	100,000	100,000
Preferred stock, shares issued	100,000	100,000
Preferred stock, shares outstanding	100,000	100,000
Preferred stock, liquidation preference per share	$ 100	$ 100

CONSOLIDATED STATEMENTS OF OPER

CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenues:
Rental and other property revenues (including $173 and $175 for the three months and $343 and $350 for the six months ended 2015 and 2014, respectively, from related parties)	$ 23,756	$ 18,511	$ 46,060	$ 36,814
Expenses:
Property operating expenses (including $178 and $148 for the three months and $331 and $293 for the six months ended 2015 and 2014, respectively, from related parties)	10,929	9,359	21,793	18,562
Depreciation and amortization	5,107	4,271	9,751	8,552
General and administrative (including $727 and $656 for the three months and $1,547 and $1,400 for the six months ended 2015 and 2014, respectively, from related parties)	1,278	2,738	3,045	4,287
Net income fee to related party	45	210	90	700
Advisory fee to related party	1,951	1,811	3,894	3,664
Total operating expenses	19,310	18,389	38,573	35,765
Net operating income	4,446	122	7,487	1,049
Other income (expense):
Interest income (including $2,748 and $4,004 for the three months and $6,167 and $6,117 for the six months ended 2015 and 2014, respectively, from related parties)	2,994	4,005	6,755	6,118
Other income	14	244	81	396
Mortgage and loan interest (including $0 and $0 for the three months and $31 and $31 for the six months ended 2015 and 2014, respectively, from related parties)	(8,216)	(7,869)	(18,401)	(16,868)
Earnings (losses) from unconsolidated joint ventures and investees	10	(11)	43	(16)
Litigation settlement (expense)	(45)	(86)	(118)	3,753
Total other expenses	(5,243)	(3,717)	(11,640)	(6,617)
Loss before gain on land sales, non-controlling interest, and taxes	(797)	(3,595)	(4,153)	(5,568)
Gain (loss) on land sales	1,250	(159)	4,126	594
Net loss from continuing operations before taxes	453	(3,754)	(27)	(4,974)
Income tax benefit (expense)	(12)	2,195	90	4,244
Net income (loss) from continuing operations	441	(1,559)	63	(730)
Discontinued operations:
Net income (loss) from discontinued operations	$ (34)	(732)	$ 258	(931)
Gain on sale of real estate from discontinued operations		7,003		13,057
Income tax benefit (expense) from discontinued operations	$ 12	(2,195)	$ (90)	(4,244)
Net income from discontinued operations	(22)	4,076	168	7,882
Net income (loss)	419	2,517	231	7,152
Net (income) loss attributable to non-controlling interest	(281)	(127)	12	(211)
Net income attributable to Transcontinental Realty Investors, Inc.	138	2,390	243	6,941
Preferred dividend requirement	(224)	(277)	(446)	(551)
Net income (loss) applicable to common shares	$ (86)	$ 2,113	$ (203)	$ 6,390
Earnings per share - basic
Net income (loss) from continuing operations (in dollars per share)	$ (0.01)	$ (0.23)	$ (0.04)	$ (0.18)
Net income from discontinued operations (in dollars per share)		0.48	0.02	.93
Net income (loss) applicable to common shares (in dollars per share)	$ (0.01)	0.25	(0.02)	.75
Earnings per share - diluted
Net income (loss) from continuing operations (in dollars per share)	$ (0.01)	(0.23)	(0.04)	(0.18)
Net income from discontinued operations (in dollars per share)		0.48	0.02	.93
Net income (loss) applicable to common shares (in dollars per share)	$ (0.01)	$ 0.25	$ (0.02)	$ .75
Weighted average common shares used in computing earnings per share (in shares)	8,717,767	8,413,469	8,717,767	8,413,469
Weighted average common shares used in computing diluted earnings per share (in shares)	8,717,767	8,413,469	8,717,767	8,413,469
Amounts attributable to Transcontinental Realty Investors, Inc.
Net income (loss) from continuing operations	$ 160	$ (1,686)	$ 75	$ (941)
Net income from discontinued operations	(22)	4,076	168	7,882
Net income	$ (138)	$ (2,390)	$ (243)	$ (6,941)

CONSOLIDATED STATEMENTS OF OPE5

CONSOLIDATED STATEMENTS OF OPERATIONS (Parenthetical) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Rental and other property revenues (including $173 and $175 for the three months and $343 and $350 for the six months ended 2015 and 2014, respectively, from related parties)	$ 23,756	$ 18,511	$ 46,060	$ 36,814
Property operating expenses (including $178 and $148 for the three months and $331 and $293 for the six months ended 2015 and 2014, respectively, from related parties)	10,929	9,359	21,793	18,562
General and administrative (including $727 and $656 for the three months and $1,547 and $1,400 for the six months ended 2015 and 2014, respectively, from related parties)	1,278	2,738	3,045	4,287
Interest income (including $2,748 and $4,004 for the three months and $6,167 and $6,117 for the six months ended 2015 and 2014, respectively, from related parties)	2,994	4,005	6,755	6,118
Mortgage and loan interest (including $0 and $0 for the three months and $31 and $31 for the six months ended 2015 and 2014, respectively, from related parties)	(8,216)	(7,869)	(18,401)	(16,868)
Related Party [Member]
Rental and other property revenues (including $173 and $175 for the three months and $343 and $350 for the six months ended 2015 and 2014, respectively, from related parties)	173	175	343	350
Property operating expenses (including $178 and $148 for the three months and $331 and $293 for the six months ended 2015 and 2014, respectively, from related parties)	178	148	331	293
General and administrative (including $727 and $656 for the three months and $1,547 and $1,400 for the six months ended 2015 and 2014, respectively, from related parties)	727	656	1,547	1,400
Interest income (including $2,748 and $4,004 for the three months and $6,167 and $6,117 for the six months ended 2015 and 2014, respectively, from related parties)	2,748	4,004	6,167	6,117
Mortgage and loan interest (including $0 and $0 for the three months and $31 and $31 for the six months ended 2015 and 2014, respectively, from related parties)	$ 0	$ 0	$ 31	$ 31

CONSOLIDATED STATEMENTS OF SHAR

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Unaudited) - 6 months ended Jun. 30, 2015 - USD ($) $ in Thousands	Comprehensive Loss [Member]	Preferred Stock [Member]	Common Stock [Member]	Treasury Stock [Member]	Paid-In Capital [Member]	Retained Earnings [Member]	Non-controlling Interest [Member]	Total
Balance, at beginning at Dec. 31, 2014	$ (57,670)	$ 1	$ 87	$ (2)	$ 271,649	$ (56,451)	$ 18,164	$ 233,448
Balance, at beginning (in shares) at Dec. 31, 2014			8,717,967
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Series D preferred stock dividends (9.0% per year)					(446)			(446)
Net income (loss)	231					243	(12)	231
Contributions from non-controlling interests							11	11
Balance, at the end at Jun. 30, 2015	$ (57,439)	$ 1	$ 87	$ (2)	$ 271,203	$ (56,208)	$ 18,163	$ 233,244
Balance, at the end (in shares) at Jun. 30, 2015			8,717,967

CONSOLIDATED STATEMENTS OF SHA7

CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY (Parenthetical)	6 Months Ended
	Jun. 30, 2015
Statement of Stockholders' Equity [Abstract]
Series D preferred stock dividend percentage	9.00%

CONSOLIDATED STATEMENTS OF COMP

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Consolidated Statements Of Comprehensive Income
Net income	$ 231	$ 7,152
Total comprehensive income	231	7,152
Comprehensive (income) loss attributable to non-controlling interest	12	(211)
Comprehensive income attributable to Transcontinental Realty Investors, Inc.	$ 243	$ 6,941

CONSOLIDATED STATEMENTS OF CASH

CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014
Cash Flow From Operating Activities:
Net income	$ 231	$ 7,152
Adjustments to reconcile net income applicable to common shares to net cash flow from operating activities:
Gain on sale of land	$ (4,126)	(594)
Gain on sale of income-producing properties		(13,057)
Depreciation and amortization	$ 9,751	9,061
Amortization of deferred borrowing costs	949	1,544
Losses (earnings) from unconsolidated joint ventures and investees	(43)	286
Decrease (increase) in assets:
Accrued interest receivable	185	7,281
Other assets	2,385	574
Prepaid expense	(8,687)	(1,182)
Escrow	(4,746)	8,910
Earnest money	(1,395)	(265)
Rent receivables	(883)	(397)
Related party receivables	(35,676)	(22,026)
Increase (decrease) in liabilities:
Accrued interest payable	327	104
Other liabilities	(3,358)	(13,082)
Net cash used in operating activities	(45,086)	$ (15,691)
Cash Flow From Investing Activities:
Proceeds from notes receivable	16,060
Origination or advances of notes receivable	$ (7,655)	$ (8,449)
Acquisition of land held for development		$ (93)
Acquisition of income producing properties	$ (105,729)
Proceeds from sale of income-producing properties		$ 41,428
Proceeds from sale of land	$ 8,618	2,221
Investment in unconsolidated real estate entities	3,176	(98)
Improvement of land held for development	(1,469)	(181)
Improvement of income-producing properties	(6,539)	(3,134)
Construction and development of new properties	(3,176)	(620)
Net cash provided by (used in) investing activities	(96,714)	31,074
Cash Flow From Financing Activities:
Proceeds from notes payable	198,770	59,487
Recurring amortization of principal on notes payable	(7,802)	(10,133)
Payments on maturing notes payable	(33,865)	(61,740)
Deferred financing costs	(7,941)	(5,135)
Contributions (distributions) non-controlling interests	$ 11	(15)
Preferred stock dividends - Series C		(106)
Preferred stock dividends - Series D	$ (446)	(445)
Net cash provided by (used in) financing activities	148,727	(18,087)
Net increase (decrease) in cash and cash equivalents	6,927	(2,704)
Cash and cash equivalents, beginning of period	12,201	16,086
Cash and cash equivalents, end of period	19,128	13,382
Supplemental disclosures of cash flow information:
Cash paid for interest	$ 16,748	$ 15,153

ORGANIZATION AND BASIS OF PRESE

ORGANIZATION AND BASIS OF PRESENTATION	6 Months Ended
	Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
ORGANIZATION AND BASIS OF PRESENTATION	NOTE 1. ORGANIZATION AND BASIS OF PRESENTATION Organization As used herein, the terms “TCI”, “the Company”, “we”, “our” or “us” refer to Transcontinental Realty Investors, Inc., a Nevada corporation. TCI is the successor to a California business trust which was organized on September 6, 1983, and commenced operations on January 31, 1984. Effective March 31, 2003, TCI’s financial results were consolidated in American Realty Investors, Inc. (“ARL”) Form 10-K and related Consolidated Financial Statements. The Company is headquartered in Dallas, Texas and its common stock trades on the New York Stock Exchange (“NYSE”) under the symbol (“TCI”). Subsidiaries of ARL own approximately 80.9% of the Company’s common stock. ARL’s common stock trades on the New York Stock Exchange under the symbol (“ARL”). We have no employees. TCI is a “C” corporation for U.S. federal income tax purposes and files an annual consolidated tax return with ARL and its ultimate parent, May Realty Holdings, Inc. (“MRHI”). TCI owns approximately 81.1% of the common stock of Income Opportunity Realty Investors, Inc. (“IOT”). Effective July 17, 2009, IOT’s financial results were consolidated with those of ARL and TCI and their subsidiaries. Shares of IOT are traded on the New York Stock Exchange Euronext (“NYSE MKT”) under the symbol (“IOT”). TCI invests in real estate through direct ownership, leases and partnerships and also invests in mortgage loans on real estate. Pillar Income Asset Management, Inc. (“Pillar”) is the Company’s external Advisor and Cash Manager. Although the Board of Directors is directly responsible for managing the affairs of TCI, and for setting the policies which guide it, the day-to-day operations of TCI are performed by Pillar, as the contractual Advisor, under the supervision of the Board. Pillar’s duties include, but are not limited to: locating, evaluating and recommending real estate and real estate-related investment opportunities, and arranging debt and equity financing for the Company with third party lenders and investors. Additionally, Pillar serves as a consultant to the Board with regard to their decisions in connection with TCI’s business plan and investment policy. Pillar also serves as an Advisor and Cash Manager to ARL and IOT. Regis Realty Prime, LLC (“Regis”) manages our commercial properties and provides brokerage services for our real estate portfolio. TCI engages third-party companies to lease and manage its apartment properties. Properties We own or had interests in a total property portfolio of 52 income-producing properties as of June 30, 2015. The properties consisted of: • Nine commercial properties consisting of five office buildings, two retail centers, one industrial warehouse and a golf course, comprising in aggregate approximately 1.9 million rentable square feet; • 43 apartment communities totaling 7,085 units; excluding apartments being developed; and • 4,044 acres of developed and undeveloped land. We join with various third-party development companies to construct residential apartment communities. We are in the predevelopment process on several residential apartment communities that have not yet begun construction. At June 30, 2015, we had two apartment projects in development. The third-party developer typically holds a general partner, as well as a majority limited partner interest in a limited partnership formed for the purpose of building a single property, while we generally take a minority limited partner interest in the limited partnership. We may contribute land to the partnership as part of our equity contribution or we may contribute the necessary funds to the partnership to acquire the land. We are required to fund all necessary equity contributions while the third-party developer is responsible for obtaining construction financing, hiring a general contractor and for the overall management, successful completion and delivery of the project. We generally bear all the economic risks and rewards of ownership in these partnerships and therefore include these partnerships in our Consolidated Financial Statements. The third-party developer is paid a developer fee typically equal to a percentage of the construction costs. When the project reaches stabilized occupancy, we acquire the third-party developer’s partnership interests in exchange for any remaining unpaid developer fees. Basis of Presentation The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring matters) considered necessary for a fair presentation have been included. The results of operations for the six months ended June 30, 2015, are not necessarily indicative of the results that may be expected for other interim periods or for the full fiscal year. The year-end Consolidated Balance Sheet at December 31, 2014, was derived from the audited Consolidated Financial Statements at that date, but does not include all of the information and disclosures required by U.S. GAAP for complete financial statements. For further information, refer to the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. Certain 2014 Consolidated Financial Statement amounts have been reclassified to conform to the 2015 presentation. Principles of Consolidation The accompanying Consolidated Financial Statements include the accounts of the Company, its subsidiaries, generally all of which are wholly-owned, and all entities in which we have a controlling interest. Arrangements that are not controlled through voting or similar rights are accounted for as a Variable Interest Entity (VIE), in accordance with the provisions and guidance of ASC Topic 810 “Consolidation”, whereby we have determined that we are a primary beneficiary of the VIE and meet certain criteria of a sole general partner or managing member as identified in accordance with Emerging Issues Task Force (“EITF”) Issue 04-5, Investor’s Accounting for an Investment in a Limited Partnership when the Investor is the Sole General Partner and the Limited Partners have Certain Rights (“EITF 04-5”). VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders as a group lack adequate decision making ability, the obligation to absorb expected losses or residual returns of the entity, or have voting rights that are not proportional to their economic interests. The primary beneficiary generally is the entity that provides financial support and bears a majority of the financial risks, authorizes certain capital transactions, or makes operating decisions that materially affect the entity’s financial results. All significant intercompany balances and transactions have been eliminated in consolidation. In determining whether we are the primary beneficiary of a VIE, we consider qualitative and quantitative factors, including, but not limited to: the amount and characteristics of our investment; the obligation or likelihood for us or other investors to provide financial support; our and the other investors’ ability to control or significantly influence key decisions for the VIE; and the similarity with and significance to the business activities of us and the other investors. Significant judgments related to these determinations include estimates about the current future fair values and performance of real estate held by these VIEs and general market conditions. For entities in which we have less than a controlling financial interest or entities where we are not deemed to be the primary beneficiary, the entities are accounted for using the equity method of accounting. Accordingly, our share of the net earnings or losses of these entities is included in consolidated net income. Our investment in ARL is accounted for under the equity method. Real Estate, Depreciation and Impairment Real estate assets are stated at the lower of depreciated cost or fair value, if deemed impaired. Major replacements and betterments are capitalized and depreciated over their estimated useful lives. Depreciation is computed on a straight-line basis over the useful lives of the properties (buildings and improvements – 10-40 years; furniture, fixtures and equipment – 5-10 years). The Company continually evaluates the recoverability of the carrying value of its real estate assets using the methodology prescribed in ASC Topic 360 (“ASC 360”), “Property, Plant and Equipment”. Factors considered by management in evaluating impairment of its existing real estate assets held for investment include significant declines in property operating profits, annually recurring property operating losses and other significant adverse changes in general market conditions that are considered permanent in nature. Under ASC 360, a real estate asset held for investment is not considered impaired if the undiscounted, estimated future cash flows of an asset (both the annual estimated cash flow from future operations and the estimated cash flow from the theoretical sale of the asset) over its estimated holding period are in excess of the asset’s net book value at the balance sheet date. If any real estate asset held for investment is considered impaired, a loss is provided to reduce the carrying value of the asset to its estimated fair value. Real Estate Held for Sale We periodically classify real estate assets as “held for sale”. An asset is classified as held for sale after the approval of our Board of Directors, after an active program to sell the asset has commenced and if the sale is probable. One of the deciding factors in determining whether a sale is probable is whether the firm purchase commitment is obtained and whether the sale is probable within the year. Upon the classification of a real estate asset as held for sale, the carrying value of the asset is reduced to the lower of its net book value or its estimated fair value, less costs to sell the asset. Subsequent to the classification of assets as held for sale, no further depreciation expense is recorded. Real estate assets held for sale are stated separately on the accompanying Consolidated Balance Sheets. Upon a decision that the sale is no longer probable, the asset is classified as an operating asset and depreciation expense is reinstated. Prior to January 1, 2015, the operating results of real estate assets held for sale and sold are reported as discontinued operations in the accompanying Consolidated Statements of Operations. Income from discontinued operations includes the revenues and expenses, including depreciation and interest expense, associated with the assets. Subsequent to January 1, 2015, Accounting Standards Update 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (“ASU 2014-08”) substantially changed the criteria for determining whether a disposition qualifies for discontinued operations presentation. Adoption of this standard will result in substantially fewer of the Company’s dispositions meeting the discontinued operations criteria. Cost Capitalization Costs related to planning, developing, leasing and constructing a property are capitalized and classified as Real Estate in the Consolidated Balance Sheets. We capitalize interest to qualifying assets under development based on average accumulated expenditures outstanding during the period. In capitalizing interest to qualifying assets, we first use the interest incurred on specific project debt, if any, and next use the weighted average interest rate of non-project specific debt. We capitalize interest, real estate taxes and certain operating expenses until building construction is substantially complete and the building is ready for its intended use, but no later than one year from the cessation of major construction activity. We capitalize leasing costs, which include commissions paid to outside brokers, legal costs incurred to negotiate and document a lease agreement and any internal costs that may be applicable. We allocate these costs to individual tenant leases and amortize them over the related lease term. Fair Value Measurement We apply the guidance in ASC Topic 820, “Fair Value Measurements and Disclosures”, to the valuation of real estate assets. These provisions define fair value as the price that would be received to sell an asset or paid to transfer a liability in a transaction between market participants at the measurement date, establish a hierarchy that prioritizes the information used in developing fair value estimates and require disclosure of fair value measurements by level within the fair value hierarchy. The hierarchy gives the highest priority to quoted prices in active markets (Level 1 measurements) and the lowest priority to unobservable data (Level 3 measurements), such as the reporting entity’s own data. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date and includes three levels defined as follows: Level 1 – Unadjusted quoted prices for identical and unrestricted assets or liabilities in active markets. Level 2 – Quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 – Unobservable inputs that are significant to the fair value measurement. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement. Deferred Costs Costs relating to the financing of properties are deferred and amortized over the life of the related financing agreement. Amortization is reflected as interest expense in the Consolidated Statements of Operations, with remaining terms ranging from 6 months to 40 years. Unamortized financing costs are written off when the financing agreement is extinguished before the maturity date. Related Parties We apply ASC Topic 805, “Business Combinations”, to evaluate business relationships. Related parties are persons or entities who have one or more of the following characteristics, which include entities for which investments in their equity securities would be required, trust for the benefit of persons including principal owners of the entities and members of their immediate families, management personnel of the entity and members of their immediate families and other parties with which the entity may deal if one party controls or can significantly influence the decision making of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests, or affiliates of the entity. Newly Issued Accounting Pronouncements In April 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity”, which changes the criteria for determining which disposals qualify to be accounted for as discontinued operations and modifies related reporting and disclosure requirements. Disposals representing a strategic shift in operations, such as change in a major line of business, a major geographical area or major equity investment, that have a major effect on a company’s operations and financial results will be presented as discontinued operations. If the disposal does qualify as a discontinued operation under ASU 2014-08, the company will be required to expand their disclosures about discontinued operations to provide more information on the assets, liabilities, income and expenses of the disposed of component. The classification of operating results as discontinued operations are applied retroactively for all periods presented. The new standard was effective January 1, 2015. We adopted ASU 2014-08 as of January 1, 2015 and believe future sales of our individual operating properties will no longer qualify as discontinued operations. Adoption of this standard has resulted in substantially fewer of the Company’s dispositions meeting the discontinued operations criteria. See Note 8 below. In May 2014, Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), “Revenue from Contracts with Customers,” was issued. This new guidance established a new single comprehensive revenue recognition model and provides for enhanced disclosures. Under the new guidance, the nature, timing and amount of revenue recognized for certain transactions could differ from those recognized under existing accounting guidance. This new guidance does not affect revenue recognized under lease contracts. ASU 2014-09 is effective for reporting periods beginning after December 15, 2017. The Company is currently evaluating the impact the adoption of this guidance, if any, on its financial position and results of operations. In April 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”). ASU 2015-03 requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. Prior to the issuance of the standard, debt issuance costs were required to be presented in the balance sheet as an asset. The Company has adopted this standard effective June 30, 2015. The accompanying financials have been reclassified to reflect the adoption.

REAL ESTATE ACTIVITY

REAL ESTATE ACTIVITY	6 Months Ended
	Jun. 30, 2015
Real Estate [Abstract]
REAL ESTATE ACTIVITY	NOTE 2. REAL ESTATE ACTIVITY Below is a summary of the real estate owned as of June 30, 2015 (dollars in thousands): Apartments $ 546,904 Apartments under construction 3,261 Commercial properties 202,912 Land held for development 146,692 Real estate subject to sales contract 22,877 Total real estate $ 922,646 Less accumulated depreciation (130,235 ) Total real estate, net of depreciation $ 792,411 The highlights of our significant real estate transactions for the six months ended June 30, 2015, are listed below: Purchases For the six months ended June 30, 2015, the Company acquired three income-producing apartment complexes from third parties in the states of Texas (1) and Florida (2), increasing the total number of units by 349, for a combined purchase price of $31.5 million. In addition, the Company acquired three income-producing apartment complexes from related parties in the states of Texas (2) and Kansas (1), increasing the total number of units by 698, for a combined purchase price of $11.6 million. The Company also purchased a commercial office building in Texas, comprised of 92,723 square feet, for $16.8 million. Sales For the six months ended June 30, 2015, the Company sold approximately 43 acres of land located in Texas to independent third parties, for a total sales price of $9.1 million. We recorded a total gain of $4.1 million from the sales. As of June 30, 2015, there is one apartment complex, one commercial building and 110 acres of land that we have sold to a related party and have deferred the recognition of the sale. These are treated as “subject to sales contract” on the Consolidated Balance Sheets. These properties were sold to a related party in order to help facilitate an appropriate debt or organizational restructure and may or may not be transferred back to the seller upon resolution. These properties have mortgages that are secured by the property and many have corporate guarantees. According to the loan documents, the maker is currently in default on these mortgages primarily due to lack of payment and is actively involved in discussions with every lender in order to settle or cure the default situation. We have reviewed each asset and taken impairment to the extent we feel the value of the property was less than our current basis. The Company did not recognize or record the sale in accordance with ASC 360-20 due to our continuing involvement, which included the potential payment of cash shortfalls, future obligations under the existing mortgage and guaranty, the buyer’s inadequate initial investment and the Company’s questionable recovery of investment cost. The Company determined that no sale had occurred for financial reporting purposes and therefore the asset remained on the books and continued to record operating expenses and depreciation as a period cost until a sale occurred that met the requirements of ASC 360-20. The buyers received no compensation for the facilitation of the bankruptcy or debt restructuring process. We continue to invest in the development of apartment projects. During the six months ended June 30, 2015, we have expended $3.2 million related to the construction or predevelopment of various apartment complexes and capitalized $25,109 of interest costs.

NOTES AND INTEREST RECEIVABLE

NOTES AND INTEREST RECEIVABLE	6 Months Ended
	Jun. 30, 2015
Receivables [Abstract]
NOTES AND INTEREST RECEIVABLE	NOTE 3. NOTES AND INTEREST RECEIVABLE A portion of our assets are invested in mortgage notes receivable, principally secured by real estate. We may originate mortgage loans in conjunction with providing purchase money financing of property sales. Notes receivable are generally collateralized by real estate or interests in real estate and personal guarantees of the borrower and, unless noted otherwise, are so secured. Management intends to service and hold for investment the mortgage notes in our portfolio. A majority of the notes receivable provide for principal to be paid at maturity. Below is a summary of our notes receivable (dollars in thousands): Maturity Interest Borrower Date Rate Amount Security Performing loans: Foundation for Better Housing, Inc. (Overlook at Allensville) (1) 11/19 12.00 % 2,472 Secured Foundation for Better Housing, Inc. (Overlook at Allensville) (1) 12/17 12.00 % 1,408 Secured Foundation for Better Housing, Inc. (Vista Ridge) (1) 04/19 12.00 % 3,923 Secured Foundation for Better Housing, Inc. (Vista Ridge) (1) 06/17 12.00 % 1,492 Secured H198, LLC (Las Vegas Land) 01/20 12.00 % 5,907 Secured Unified Housing Foundation, Inc. (Echo Station) (1) 09/17 12.00 % 1,481 100% Interest in Unified Housing of Temple, LLC Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00 % 2,000 Unsecured Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00 % 6,363 Membership interest in Housing for Seniors of Humble, LLC Unified Housing Foundation, Inc. (Limestone Canyon) (1) 12/32 12.00 % 4,663 100% Interest in Unified Housing of Austin, LLC Unified Housing Foundation, Inc. (Limestone Canyon) (1) 12/32 12.00 % 3,057 100% Interest in Unified Housing of Austin, LLC Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00 % 6,000 100% Interest in Unified Housing of Vista Ridge, LLC Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00 % 2,250 100% Interest in Unified Housing of Vista Ridge, LLC Unified Housing Foundation, Inc. (Parkside Crossing) (1) 12/32 12.00 % 1,936 100% Interest in Unified Housing of Parkside Crossing, LLC Unified Housing Foundation, Inc. (Sendero Ridge) (1) 12/32 12.00 % 4,812 100% Interest in Unified Housing of Sendero Ridge, LLC Unified Housing Foundation, Inc. (Sendero Ridge) (1) 12/32 12.00 % 5,174 100% Interest in Unified Housing of Sendero Ridge, LLC Unified Housing Foundation, Inc. (Timbers of Terrell) (1) 12/32 12.00 % 1,323 100% Interest in Unified Housing of Terrell, LLC Unified Housing Foundation, Inc. (Tivoli) (1) 12/32 12.00 % 7,966 100% Interest in Unified Housing of Tivoli, LLC Unified Housing Foundation, Inc. (1) 06/17 12.00 % 1,261 Unsecured Unified Housing Foundation, Inc. (1) 12/17 12.00 % 1,207 Unsecured Other related party notes (1) Various Various 768 Various secured interests Other related party notes (1) Various Various 4,929 Various unsecured interests Other non-related party notes Various Various 496 Various secured interests Other non-related party notes Various Various 503 Various unsecured interests Accrued interest 4,862 Total Performing $ 76,253 Non-Performing loans: Other non-related party notes Various Various 507 Secured Accrued interest 97 Total Non-Performing $ 604 Allowance for doubtful accounts (1,990 ) Total $ 74,867 (1) Junior Mortgage Loans At June 30, 2015, we had junior mortgage loans and accrued interest receivable from related parties, net of allowances, totaling $67.2 million. We recognized interest income of $4.9 million related to these notes receivables. The Company has various notes receivable from Unified Housing Foundation, Inc. (“UHF”) and Foundation for Better Housing, Inc. (“FBH”). UHF and FBH are determined to be related parties due to our reliance upon the performance of the collateral secured under the notes receivable. Payments are due from surplus cash flow of operations of the properties. A sale or refinance of any of the properties underlying these notes will be used to repay outstanding interest and principal for the remaining notes for the specific borrower. These notes are cross-collateralized for the specific borrower, but to the extent cash is received from a specific UHF or FBH property, it is applied first against any outstanding interest for the related-property note. The allowance on the UHF notes was a purchase allowance that was netted against the notes when acquired.

INVESTMENT IN UNCONSOLIDATED JO

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES	6 Months Ended
	Jun. 30, 2015
Equity Method Investments and Joint Ventures [Abstract]
INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES	NOTE 4. INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES Investments in unconsolidated joint ventures and other investees in which we have a 20% to 50% interest or otherwise exercise significant influence, are carried at cost and adjusted for the Company’s proportionate share of their undistributed earnings or losses under the equity method of accounting. ARL is our parent company and is considered as an unconsolidated joint venture. Investments in unconsolidated joint ventures and investees consist of the following: Percentage ownership as of June 30, 2015 June 30, 2014 American Realty Investors, Inc. (1) 1.00 % 1.99 % (1) Our interest in the common stock of ARL in the amount of 1.00% is accounted for under the equity method because we exercise significant influence over the operations and financial activities. Accordingly, the investments are carried at cost, adjusted for the Company’s proportionate share of earnings or losses. The following is a summary of the financial position and results of operations from our unconsolidated parent (dollars in thousands): As of June 30, 2015 2014 Real estate, net of accumulated depreciation $ 14,285 $ 15,149 Notes receivable 50,519 68,940 Other assets 127,217 128,581 Notes payable (28,193 ) (52,369 ) Other liabilities (94,201 ) (100,149 ) Shareholders' equity (69,627 ) (60,152 ) For the Six Months Ended June 30, 2015 2014 Rents and interest and other income $ 6,359 $ 5,894 Depreciation (78 ) (138 ) Operating expenses (1,810 ) (3,093 ) Interest expense (1,448 ) (3,447 ) Income (loss) from continuing operations 3,023 (784 ) Income (loss) from discontinued operations — — Net income (loss) $ 3,023 $ (784 ) Company's proportionate share of income (loss) $ 30 $ (16)

NOTES PAYABLE

NOTES PAYABLE	6 Months Ended
	Jun. 30, 2015
Debt Disclosure [Abstract]
NOTES PAYABLE	NOTE 5. NOTES PAYABLE Below is a summary of our notes and interest payable as of June 30, 2015 (dollars in thousands): Notes Payable Accrued Interest Total Debt Apartments $ 443,429 $ 1,316 $ 444,745 Commercial 117,392 494 117,886 Land 56,917 116 57,033 Real estate subject to sales contract 16,547 1,705 18,252 Mezzanine financing 123,900 — 123,900 Other 4,530 — 4,530 Total $ 762,715 $ 3,631 $ 766,346 Unamortized deferred borrowing costs (19,962 ) — (19,962 ) Total $ 742,753 $ 3,631 $ 746,384 The segment labeled as “Other” consists of unsecured or stock-secured notes payable. With respect to the additional notes payable due to the acquisition of properties or refinancing of existing mortgages, a summary of some of the more significant transactions is discussed below: On January 28, 2015, the Company modified the existing mortgage on a 200-unit complex located in Texas, to reduce the interest rate. The modified note accrues interest at 3.24% and payments of interest and principal are due monthly, maturing August 1, 2050. On January 28, 2015, the Company modified the existing mortgage on a 240-unit complex located in Mississippi, to reduce the interest rate. The modified note accrues interest at 3.24% and payments of interest and principal are due monthly, maturing December 1, 2051 . On April 23, 2015, the Company refinanced the existing mortgage on a 250-unit complex located in Arkansas, for a new mortgage of $21.0 million. We paid off the existing mortgage of $15.7 million and $0.6 million in closing costs. The note accrues interest at 2.74% and payments of interest and principal are due monthly, maturing May 1, 2050. On April 29, 2015, the Company refinanced the existing mortgage on a 240-unit complex located in Texas, for a new mortgage of $15.4 million. We paid $0.7 million in closing costs. The note accrues interest at 3.28% and payments of interest and principal are due monthly, maturing March 31, 2051. On May 28, 2015, the Company secured additional financing of $120.0 million from an independent third party. At closing $84.4 million was advanced to the Company. The financing can be used for general corporate purposes, acquisition of multi-family apartment complexes and to reduce debt. The note has a term of five years at an interest rate of 30 day Libor plus 10.75%. The note is interest only, payable monthly, with the principal due at the end of the five years. The loan is secured by various equity interests in certain residential apartments. The note contains customary restrictions, representations, covenants, corporate and officer guarantees, events of default and require the Company to meet certain financial covenants. The Company believes it is in compliance with these financial covenants at June 30, 2015. Simultaneous with the closing of the above financing, the Company amended its existing financing of $40.0 million from an independent third party. The note has a term of five years at an interest rate of 12.0%. The note is interest only for the first year with quarterly principal payments due of $0.5 million starting April 1, 2015. As of June 30, 2015, the outstanding balance on the loan was $39.5 million. The loan is secured by various equity interests in residential apartments and can be prepaid at a penalty rate of 4% for year 1 with the penalty declining by 1% each year thereafter. The note contains customary restrictions, representations, covenants, corporate and officer guarantees, events of default and require the Company to meet certain financial covenants. The Company believes it is in compliance with these financial covenants at June 30, 2015. There are various land mortgages, secured by the property, that are in the process of a modification or extension to the original note due to expiration of the loan. We are in constant contact with these lenders, working together in order to modify the terms of these loans and we anticipate a timely resolution that is similar to the existing agreement or subsequent modification. In conjunction with the development of various apartment projects and other developments, we drew down $1.7 million in construction loans during the six months ended June 30, 2015. The properties that we have sold to a related party and have deferred the recognition of the sale are treated as “subject to sales contract” on the Consolidated Balance Sheets. These properties were sold to a related party in order to help facilitate an appropriate debt or organizational restructure and may or may not be transferred back to the seller upon resolution. These properties have mortgages that are secured by the property and many have corporate guarantees. According to the loan documents, the maker is currently in default on these mortgages primarily due to lack of payment and is actively involved in discussions with every lender in order to settle or cure the default situation. We have reviewed each asset and taken impairment to the extent we feel the value of the property was less than our current basis.

RELATED PARTY TRANSACTIONS

RELATED PARTY TRANSACTIONS	6 Months Ended
	Jun. 30, 2015
Related Party Transactions [Abstract]
RELATED PARTY TRANSACTIONS AND FEES	NOTE 6. RELATED PARTY TRANSACTIONS The following table reconciles the beginning and ending balances of accounts receivable from and (accounts payable) to related parties as of June 30, 2015 (dollars in thousands): Pillar ARL Total Related party receivable, December 31, 2014 $ — $ 58,404 $ 58,404 Cash transfers 38,073 — 38,073 Advisory fees (3,893 ) — (3,893 ) Net income fee (90 ) — (90 ) Fees and commissions (2,391 ) — (2,391 ) Cost reimbursements (1,457 ) — (1,457 ) Interest income — 1,297 1,297 Expenses paid by advisor (4,993 ) — (4,993 ) Financing (mortgage payments) 3,381 — 3,381 Sales/purchases transactions 5,749 — 5,749 Purchase of obligations (34,379 ) 34,379 — Related party receivable, June 30, 2015 $ — $ 94,080 $ 94,080 During the ordinary course of business, we have related party transactions that include, but are not limited to, rental income, interest income, interest expense, general and administrative costs, commissions, management fees, and property expenses. In addition, we have assets and liabilities that include related party amounts. The related party amounts included in assets and liabilities, and the related party revenues and expenses received/paid are shown on the face of the Consolidated Financial Statements.

OPERATING SEGMENTS

OPERATING SEGMENTS	6 Months Ended
	Jun. 30, 2015
Segment Reporting [Abstract]
OPERATING SEGMENTS	NOTE 7. OPERATING SEGMENTS Our segments are based on our method of internal reporting, which classifies our operations by property type. Our property types are grouped into commercial properties, apartments, land and other operating segments. Significant differences between and among the accounting policies of the operating segments as compared to the Consolidated Financial Statements principally involve the calculation and allocation of administrative and other expenses. Management evaluates the performance of each of the operating segments and allocates resources to them based on their net operating income and cash flow. Items of income that are not reflected in the segments are interest, other income, gain on debt extinguishment, gain on condemnation award, equity in partnerships, and gains on sale of real estate. Expenses that are not reflected in the segments are provision for losses, advisory fees, net income and incentive fees, general and administrative, non-controlling interests and net loss from discontinued operations before gains on sale of real estate. The segment labeled as “Other” consists of revenue and operating expenses related to the notes receivable and corporate debt. Presented below is our reportable segments’ operating income for the three and six months ended June 30, 2015 and 2014, including segment assets and expenditures (dollars in thousands): For the Three Months Ended June 30, 2015 Commercial Apartments Land Other Total Rental and other property revenues $ 6,678 $ 17,070 $ — $ 8 $ 23,756 Property operating expenses (3,134 ) (7,693 ) (129 ) 27 (10,929 ) Depreciation (2,197 ) (2,910 ) — — (5,107 ) Mortgage and loan interest (1,639 ) (3,293 ) (1,193 ) (2,091 ) (8,216 ) Interest income — — — 2,994 2,994 Gain on land sales — — 1,250 — 1,250 Segment operating income (loss) $ (292 ) $ 3,174 $ (72 ) $ 938 $ 3,748 Capital expenditures 2,940 1,498 485 — 4,923 Real estate assets 160,403 476,391 155,617 — 792,411 Property Sales Sales price $ — $ — $ 1,878 $ — $ 1,878 Cost of sale — — (628 ) — (628 ) Gain on sale $ — $ — $ 1,250 $ — $ 1,250 For the Three Months Ended June 30, 2014 Commercial Apartments Land Other Total Rental and other property revenues $ 4,425 $ 14,072 $ — $ 14 $ 18,511 Property operating expenses (2,968 ) (6,187 ) (204 ) — (9,359 ) Depreciation (1,733 ) (2,538 ) — — (4,271 ) Mortgage and loan interest (1,546 ) (3,754 ) (1,348 ) (1,221 ) (7,869 ) Interest income — — — 4,005 4,005 Loss on land sales — — (159 ) — (159 ) Segment operating income (loss) $ (1,822 ) $ 1,593 $ (1,711 ) $ 2,798 $ 858 Capital expenditures 1,859 99 66 — 2,024 Real estate assets 129,607 374,022 157,623 — 661,252 Property Sales Sales price $ 16,600 $ — $ 717 $ — $ 17,317 Cost of sale (9,597 ) — (876 ) — (10,473 ) Gain (loss) on sale $ 7,003 $ — $ (159 ) $ — $ 6,844 The table below reconciles the segment information to the corresponding amounts in the Consolidated Statements of Operations (dollars in thousands): For the Three Months Ended June 30, 2015 2014 Segment operating income $ 3,748 $ 858 Other non-segment items of income (expense) General and administrative (1,278 ) (2,738 ) Net income fee to related party (45 ) (210 ) Advisory fee to related party (1,951 ) (1,811 ) Other income 14 244 Earnings (loss) from unconsolidated joint ventures and investees 10 (11 ) Litigation settlement (45 ) (86 ) Income tax benefit (expense) (12 ) 2,195 Net income (loss) from continuing operations $ 441 $ (1,559 ) The table below reconciles the segment information to the corresponding amounts in the Consolidated Balance Sheets (dollars in thousands): As of June 30, 2015 2014 Segment assets $ 792,411 $ 661,252 Investments in real estate partnerships 2,155 1,509 Notes and interest receivable 74,867 69,074 Other assets 198,561 135,730 Total assets $ 1,067,994 $ 867,565 For the Six Months Ended June 30, 2015 Commercial Apartments Land Other Total Rental and other property revenues $ 13,464 $ 32,543 $ — $ 53 $ 46,060 Property operating expenses (7,147 ) (14,353 ) (310 ) 17 (21,793 ) Depreciation (4,092 ) (5,659 ) — — (9,751 ) Mortgage and loan interest (3,245 ) (9,364 ) (2,197 ) (3,595 ) (18,401 ) Interest income — — — 6,755 6,755 Gain on land sales — — 4,126 — 4,126 Segment operating income (loss) $ (1,020 ) $ 3,167 $ 1,619 $ 3,230 $ 6,996 Capital expenditures 6,132 1,755 1,311 — 9,198 Real estate assets 160,403 476,391 155,617 — 792,411 Property Sales Sales price $ — $ — $ 9,135 $ — $ 9,135 Cost of sale — — (5,009 ) — (5,009 ) Gain on sale $ — $ — $ 4,126 $ — $ 4,126 For the Six Months Ended June 30, 2014 Commercial Properties Apartments Land Other Total Rental and other property revenues $ 8,875 $ 27,917 $ — $ 22 $ 36,814 Property operating expenses (5,845 ) (12,319 ) (393 ) (5 ) (18,562 ) Depreciation (3,524 ) (5,028 ) — — (8,552 ) Mortgage and loan interest (2,975 ) (9,949 ) (2,488 ) (1,456 ) (16,868 ) Interest income — — — 6,118 6,118 Gain on land sales — — 594 — 594 Segment operating income (loss) $ (3,469 ) $ 621 $ (2,287 ) $ 4,679 $ (456 ) Capital expenditures 2,989 99 151 # — 3,239 Real estate assets 129,607 374,022 157,623 — 661,252 Property Sales Sales price $ 16,600 $ 23,131 $ 2,367 $ — $ 42,098 Cost of sale (9,597 ) (17,077 ) (1,773 ) — (28,447 ) Gain on sale $ 7,003 $ 6,054 $ 594 $ — $ 13,651 The tables below reconcile the segment information to the corresponding amounts in the Consolidated Statements of Operations: For the Six Months Ended June 30, 2015 2014 Segment operating income (loss) $ 6,996 $ (456 ) Other non-segment items of income (expense) General and administrative (3,045 ) (4,287 ) Net income fee to related party (90 ) (700 ) Advisory fee to related party (3,894 ) (3,664 ) Other income 81 396 Earnings (loss) from unconsolidated joint ventures and investees 43 (16 ) Litigation settlement (118 ) 3,753 Income tax benefit 90 4,244 Net income (loss) from continuing operations $ 63 $ (730 ) The tables below reconcile the segment information to the corresponding amounts in the Consolidated Balance Sheets: As of June 30, 2015 2014 Segment assets $ 792,411 $ 661,252 Investments in real estate partnerships 2,155 1,509 Notes and interest receivable 74,867 69,074 Other assets 198,561 135,730 Total assets $ 1,067,994 $ 867,565

DISCONTINUED OPERATIONS

DISCONTINUED OPERATIONS	6 Months Ended
	Jun. 30, 2015
Discontinued Operations and Disposal Groups [Abstract]
DISCONTINUED OPERATIONS	NOTE 8. DISCONTINUED OPERATIONS Prior to January 1, 2015, we applied the provisions of ASC 360, “Property, Plant and Equipment”, which required that long-lived assets that are to be disposed of by sale be measured at the lesser of (1) book value or (2) fair value less cost to sell. In addition, it requires that one accounting model be used for long-lived assets to be disposed of by sale and broadens the presentation of discontinued operations to include more disposal transactions. Effective January 1, 2015, the Company adopted the provisions of ASU 2014-08, ”Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity ” Disposals representing a strategic shift in operations that have a major effect on a company’s operations and financial results will be presented as discontinued operations. Companies will be required to expand their disclosures about discontinued operations to provide more information on the assets, liabilities, income and expenses of the discontinued operations. The new standard was effective January 1, 2015. Adoption of this standard will result in substantially fewer of the Company’s dispositions meeting the discontinued operations criteria. There were no sales of income-producing properties in the first six months of 2015. In 2014, we sold two apartment complexes (both in Texas), and two commercial properties (one in Louisiana and one in Alaska). The gain on sale of the properties is also included in discontinued operations for those years. The following table summarizes revenue and expense information for the properties sold and held for sale (dollars in thousands): For the Three Months Ended June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 Revenues: Rental and other property revenues $ — $ 1,341 $ 15 $ 3,912 — 1,341 15 3,912 Expenses: Property operating expenses 26 557 (348 ) 1,875 Depreciation — 179 — 509 General and administrative 7 140 104 313 Total operating expenses 33 876 (244 ) 2,697 Other income (expense): Other income — (528 ) — (486 ) Mortgage and loan interest (1 ) (464 ) (1 ) (1,410 ) Litigation settlement — (205 ) — (250 ) Total other expenses (1 ) (1,197 ) (1 ) (2,146 ) Gain (loss) from discontinued operations before gain on sale of real estate and tax (34 ) (732 ) 258 (931 ) Gain on sale of real estate from discontinued operations — 7,003 — 13,057 Income tax benefit (expense) 12 (2,195 ) (90 ) (4,244 ) Income (loss) from discontinued operations $ (22 ) $ 4,076 $ 168 $ 7,882 Our application of ASC 360 results in the presentation of the net operating results of these qualifying properties sold or held for sale during 2015 as income from discontinued operations. This does not have an impact on net income available to common shareholders and only impacts the presentation of these properties within the Consolidated Statements of Operations .

COMMITMENTS AND CONTINGENCIES A

COMMITMENTS AND CONTINGENCIES AND LIQUIDITY	6 Months Ended
	Jun. 30, 2015
Commitments and Contingencies Disclosure [Abstract]
COMMITMENTS AND CONTINGENCIES AND LIQUIDITY	NOTE 9. COMMITMENTS AND CONTINGENCIES AND LIQUIDITY Dynex Capital, Inc. On July 20, 2015, the 68 th An original trial in 2004, which also included Dynex Capital, Inc. as a defendant, resulted in a jury awarding damages in favor of Basic for “lost opportunity,” as well as damages in favor of ART and in favor of TCI and its subsidiaries for “increased costs” and “lost opportunity.” The original Trial Court judge ignored the jury’s findings, however, and entered a “Judgment Notwithstanding the Verdict” (“JNOV”) in favor of the Dynex entities (the judge held the Plaintiffs were not entitled to any damages from the Dynex entities). After numerous appeals by all parties, Dynex Capital, Inc. was ultimately dismissed from the case and the remaining claims against Dynex Commercial were remanded to the Trial Court for a new judgment consistent with the jury’s findings. The Court entered the new Final Judgment against Dynex Commercial, Inc. on July 20, 2015. The Final Judgment entered against Dynex Commercial, Inc. on July 20, 2015 awarded Basic $.256 million in damages, plus pre-judgment interest of $.192 million for a total amount of $.448 million. The Judgment awarded ART $14.2 million in damages, plus pre-judgment interest of $10.6 million for a total amount of $24.9 million. The Judgment awarded TCI $11.1 million, plus pre-judgment interest of $8.4 million for a total amount of $19.5 million. The Judgment also awarded Basic, ART, and TCI post-judgment interest at the rate of 5% per annum from April 25, 2014 until the date their respective damages are paid. Lastly, the Judgement awarded Basic, ART, and TCI $1.6 million collectively in attorneys’ fees from Dynex Commercial, Inc. The Company is reviewing the Final Judgment with counsel to determine the appropriate steps moving forward now that they have obtained this Final Judgment against Dynex Commercial, Inc. ART and ART Midwest, Inc. In August 2014, David M. Clapper and two entities related to Mr. Clapper (all, collectively, the “Clapper Parties”) filed a complaint in the U. S. District Court against the Company, its directors and certain of its officers alleging purported transactions to the detriment of the Clapper Parties and others by transferring assets, cash and diverting property. Management of the Company believes that there is no basis for this action against the Company and its officers and directors and intends to vigorously defend itself. The August 2014 complaint does not allege any facts relating to the Company, except that the named directors and officers are directors and officers of the Company and that the Company is a Nevada corporation, with its headquarters/principal place of business in Dallas, Texas. The case arises over other litigation, commenced in 1999, among the Clapper Parties and American Realty Trust, Inc. (“ART”) and its former subsidiary, ART Midwest, Inc., originally arising out of a transaction in 1998, in which ART and the Clapper Parties were to form a partnership to own eight residential apartment complexes. Over the ensuing years, a number of rulings, both for and against ART and ART Midwest, Inc., were issued, resulting in a ruling in October 2011, under which the Clapper Parties were awarded an initial judgment for approximately $74 million, including $26 million in actual damages and $48 million in interest. The 2011 ruling was only against ART and ART Midwest, Inc., but no other entity. During February 2014, the Court of Appeals affirmed a portion of the judgment in favor of the Clapper Parties but also ruled that a double counting of a significant portion of the damages had occurred and remanded the case back to the trial court to recalculate the damage award, as well as pre- and post-judgment interest thereon. ART was also a significant owner of a partnership interest in the partnership that was awarded the initial damages in the matter. ART and ART Midwest, Inc. are not and have never been subsidiaries of the Company. Management believes that the Company has no liability for any ultimate judgment in the proceeding involving the Clapper Parties. TCI is also involved in various other lawsuits arising in the ordinary course of business. Management is of the opinion that the outcome of these lawsuits will have no material impact on TCI’s financial condition, results of operations or liquidity. Liquidity. Partnership Buyouts Litigation. The Company is involved in and vigorously defending against, a number of deficiency claims with respect to assets that have been foreclosed by various lenders. Such claims are generally against a consolidated subsidiary as the borrower or the Company as a guarantor of indebtedness or performance. Some of these proceedings may ultimately result in an unfavorable determination for the Company and/or one of its consolidated subsidiaries. While we cannot predict the final result of such proceedings, management believes that the maximum exposure to the Company and its consolidated subsidiaries, if any, will not exceed approximately $20.0 million in the aggregate and will occur, if at all, in future years.

EARNINGS PER SHARE

EARNINGS PER SHARE	6 Months Ended
	Jun. 30, 2015
Earnings Per Share [Abstract]
EARNINGS PER SHARE	NOTE 10. EARNINGS PER SHARE Earnings per share (“EPS”) have been computed pursuant to the provisions of ASC Topic 260 “Earnings Per Share”. The computation of basic EPS is calculated by dividing income available to common shareholders from continuing operations, adjusted for preferred dividends, by the weighted-average number of common shares outstanding during the period. Shares issued during the period shall be weighted for the portion of the period that they were outstanding. Prior to July 9, 2014, we had 30,000 shares of Series C cumulative convertible preferred stock issued and outstanding. These 30,000 shares were owned by RAI, a related party, and had accrued dividends unpaid of $0.9 million. The stock had a liquidation preference of $100 per share and could be converted into common stock at 90% of the daily average closing price of the common stock for the prior five trading days. On July 9, 2014, RAI converted all 30,000 shares into the requisite number of shares of common stock. The conversion resulted in the issuance of 304,298 new shares of common stock. The effects of the Series C Cumulative Convertible Preferred Stock are no longer included in the dilutive earnings per share calculation for the current period, but are considered in the calculation for the prior period if applying the if-converted method is dilutive. Prior to January 1, 2015, the Company had 5,000 shares of stock options outstanding. These options expired unexercised January 1, 2015. The options are no longer included in the dilutive earnings per share calculation for the current period, but are considered in the computation for the prior periods if applying the “treasury stock” method is dilutive. In the prior period, the preferred stock and stock options were dilutive and thus included in the EPS calculation.

SUBSEQUENT EVENTS

SUBSEQUENT EVENTS	6 Months Ended
	Jun. 30, 2015
Subsequent Events [Abstract]
SUBSEQUENT EVENTS	NOTE 11. SUBSEQUENT EVENTS The date to which events occurring after June 30, 2015, the date of the most recent balance sheet, have been evaluated for possible adjustment to the Consolidated Financial Statements or disclosure is August 13, 2015, which is the date on which the Consolidated Financial Statements were available to be issued. The Company has determined that there are no subsequent events to be reported.

ORGANIZATION AND BASIS OF PRE21

ORGANIZATION AND BASIS OF PRESENTATION ( Policies)	6 Months Ended
	Jun. 30, 2015
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization	Organization As used herein, the terms “TCI”, “the Company”, “we”, “our” or “us” refer to Transcontinental Realty Investors, Inc., a Nevada corporation. TCI is the successor to a California business trust which was organized on September 6, 1983, and commenced operations on January 31, 1984. Effective March 31, 2003, TCI’s financial results were consolidated in American Realty Investors, Inc. (“ARL”) Form 10-K and related Consolidated Financial Statements. The Company is headquartered in Dallas, Texas and its common stock trades on the New York Stock Exchange (“NYSE”) under the symbol (“TCI”). Subsidiaries of ARL own approximately 80.9% of the Company’s common stock. ARL’s common stock trades on the New York Stock Exchange under the symbol (“ARL”). We have no employees. TCI is a “C” corporation for U.S. federal income tax purposes and files an annual consolidated tax return with ARL and its ultimate parent, May Realty Holdings, Inc. (“MRHI”). TCI owns approximately 81.1% of the common stock of Income Opportunity Realty Investors, Inc. (“IOT”). Effective July 17, 2009, IOT’s financial results were consolidated with those of ARL and TCI and their subsidiaries. Shares of IOT are traded on the New York Stock Exchange Euronext (“NYSE MKT”) under the symbol (“IOT”). TCI invests in real estate through direct ownership, leases and partnerships and also invests in mortgage loans on real estate. Pillar Income Asset Management, Inc. (“Pillar”) is the Company’s external Advisor and Cash Manager. Although the Board of Directors is directly responsible for managing the affairs of TCI, and for setting the policies which guide it, the day-to-day operations of TCI are performed by Pillar, as the contractual Advisor, under the supervision of the Board. Pillar’s duties include, but are not limited to: locating, evaluating and recommending real estate and real estate-related investment opportunities, and arranging debt and equity financing for the Company with third party lenders and investors. Additionally, Pillar serves as a consultant to the Board with regard to their decisions in connection with TCI’s business plan and investment policy. Pillar also serves as an Advisor and Cash Manager to ARL and IOT. Regis Realty Prime, LLC (“Regis”) manages our commercial properties and provides brokerage services for our real estate portfolio. TCI engages third-party companies to lease and manage its apartment properties.
Properties	Properties We own or had interests in a total property portfolio of 52 income-producing properties as of June 30, 2015. The properties consisted of: • Nine commercial properties consisting of five office buildings, two retail centers, one industrial warehouse and a golf course, comprising in aggregate approximately 1.9 million rentable square feet; • 43 apartment communities totaling 7,085 units; excluding apartments being developed; and • 4,044 acres of developed and undeveloped land. We join with various third-party development companies to construct residential apartment communities. We are in the predevelopment process on several residential apartment communities that have not yet begun construction. At June 30, 2015, we had two apartment projects in development. The third-party developer typically holds a general partner, as well as a majority limited partner interest in a limited partnership formed for the purpose of building a single property, while we generally take a minority limited partner interest in the limited partnership. We may contribute land to the partnership as part of our equity contribution or we may contribute the necessary funds to the partnership to acquire the land. We are required to fund all necessary equity contributions while the third-party developer is responsible for obtaining construction financing, hiring a general contractor and for the overall management, successful completion and delivery of the project. We generally bear all the economic risks and rewards of ownership in these partnerships and therefore include these partnerships in our Consolidated Financial Statements. The third-party developer is paid a developer fee typically equal to a percentage of the construction costs. When the project reaches stabilized occupancy, we acquire the third-party developer’s partnership interests in exchange for any remaining unpaid developer fees.
Basis of Presentation	Basis of Presentation The accompanying unaudited Consolidated Financial Statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”) have been condensed or omitted in accordance with such rules and regulations, although management believes the disclosures are adequate to prevent the information presented from being misleading. In the opinion of management, all adjustments (consisting of normal recurring matters) considered necessary for a fair presentation have been included. The results of operations for the six months ended June 30, 2015, are not necessarily indicative of the results that may be expected for other interim periods or for the full fiscal year. The year-end Consolidated Balance Sheet at December 31, 2014, was derived from the audited Consolidated Financial Statements at that date, but does not include all of the information and disclosures required by U.S. GAAP for complete financial statements. For further information, refer to the Consolidated Financial Statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2014. Certain 2014 Consolidated Financial Statement amounts have been reclassified to conform to the 2015 presentation.
Principles of Consolidation	Principles of Consolidation The accompanying Consolidated Financial Statements include the accounts of the Company, its subsidiaries, generally all of which are wholly-owned, and all entities in which we have a controlling interest. Arrangements that are not controlled through voting or similar rights are accounted for as a Variable Interest Entity (VIE), in accordance with the provisions and guidance of ASC Topic 810 “Consolidation”, whereby we have determined that we are a primary beneficiary of the VIE and meet certain criteria of a sole general partner or managing member as identified in accordance with Emerging Issues Task Force (“EITF”) Issue 04-5, Investor’s Accounting for an Investment in a Limited Partnership when the Investor is the Sole General Partner and the Limited Partners have Certain Rights (“EITF 04-5”). VIEs are generally entities that lack sufficient equity to finance their activities without additional financial support from other parties or whose equity holders as a group lack adequate decision making ability, the obligation to absorb expected losses or residual returns of the entity, or have voting rights that are not proportional to their economic interests. The primary beneficiary generally is the entity that provides financial support and bears a majority of the financial risks, authorizes certain capital transactions, or makes operating decisions that materially affect the entity’s financial results. All significant intercompany balances and transactions have been eliminated in consolidation. In determining whether we are the primary beneficiary of a VIE, we consider qualitative and quantitative factors, including, but not limited to: the amount and characteristics of our investment; the obligation or likelihood for us or other investors to provide financial support; our and the other investors’ ability to control or significantly influence key decisions for the VIE; and the similarity with and significance to the business activities of us and the other investors. Significant judgments related to these determinations include estimates about the current future fair values and performance of real estate held by these VIEs and general market conditions. For entities in which we have less than a controlling financial interest or entities where we are not deemed to be the primary beneficiary, the entities are accounted for using the equity method of accounting. Accordingly, our share of the net earnings or losses of these entities is included in consolidated net income. Our investment in ARL is accounted for under the equity method.
Real Estate, Depreciation and Impairment	Real Estate, Depreciation and Impairment Real estate assets are stated at the lower of depreciated cost or fair value, if deemed impaired. Major replacements and betterments are capitalized and depreciated over their estimated useful lives. Depreciation is computed on a straight-line basis over the useful lives of the properties (buildings and improvements – 10-40 years; furniture, fixtures and equipment – 5-10 years). The Company continually evaluates the recoverability of the carrying value of its real estate assets using the methodology prescribed in ASC Topic 360 (“ASC 360”), “Property, Plant and Equipment”. Factors considered by management in evaluating impairment of its existing real estate assets held for investment include significant declines in property operating profits, annually recurring property operating losses and other significant adverse changes in general market conditions that are considered permanent in nature. Under ASC 360, a real estate asset held for investment is not considered impaired if the undiscounted, estimated future cash flows of an asset (both the annual estimated cash flow from future operations and the estimated cash flow from the theoretical sale of the asset) over its estimated holding period are in excess of the asset’s net book value at the balance sheet date. If any real estate asset held for investment is considered impaired, a loss is provided to reduce the carrying value of the asset to its estimated fair value.
Real Estate Held For Sale	Real Estate Held for Sale We periodically classify real estate assets as “held for sale”. An asset is classified as held for sale after the approval of our Board of Directors, after an active program to sell the asset has commenced and if the sale is probable. One of the deciding factors in determining whether a sale is probable is whether the firm purchase commitment is obtained and whether the sale is probable within the year. Upon the classification of a real estate asset as held for sale, the carrying value of the asset is reduced to the lower of its net book value or its estimated fair value, less costs to sell the asset. Subsequent to the classification of assets as held for sale, no further depreciation expense is recorded. Real estate assets held for sale are stated separately on the accompanying Consolidated Balance Sheets. Upon a decision that the sale is no longer probable, the asset is classified as an operating asset and depreciation expense is reinstated. Prior to January 1, 2015, the operating results of real estate assets held for sale and sold are reported as discontinued operations in the accompanying Consolidated Statements of Operations. Income from discontinued operations includes the revenues and expenses, including depreciation and interest expense, associated with the assets. Subsequent to January 1, 2015, Accounting Standards Update 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity” (“ASU 2014-08”) substantially changed the criteria for determining whether a disposition qualifies for discontinued operations presentation. Adoption of this standard will result in substantially fewer of the Company’s dispositions meeting the discontinued operations criteria.
Cost Capitalization	Cost Capitalization Costs related to planning, developing, leasing and constructing a property are capitalized and classified as Real Estate in the Consolidated Balance Sheets. We capitalize interest to qualifying assets under development based on average accumulated expenditures outstanding during the period. In capitalizing interest to qualifying assets, we first use the interest incurred on specific project debt, if any, and next use the weighted average interest rate of non-project specific debt. We capitalize interest, real estate taxes and certain operating expenses until building construction is substantially complete and the building is ready for its intended use, but no later than one year from the cessation of major construction activity. We capitalize leasing costs, which include commissions paid to outside brokers, legal costs incurred to negotiate and document a lease agreement and any internal costs that may be applicable. We allocate these costs to individual tenant leases and amortize them over the related lease term.
Fair Value Measurement	Fair Value Measurement We apply the guidance in ASC Topic 820, “Fair Value Measurements and Disclosures”, to the valuation of real estate assets. These provisions define fair value as the price that would be received to sell an asset or paid to transfer a liability in a transaction between market participants at the measurement date, establish a hierarchy that prioritizes the information used in developing fair value estimates and require disclosure of fair value measurements by level within the fair value hierarchy. The hierarchy gives the highest priority to quoted prices in active markets (Level 1 measurements) and the lowest priority to unobservable data (Level 3 measurements), such as the reporting entity’s own data. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date and includes three levels defined as follows: Level 1 – Unadjusted quoted prices for identical and unrestricted assets or liabilities in active markets. Level 2 – Quoted prices for similar assets and liabilities in active markets, and inputs that are observable for the asset or liability, either directly or indirectly, for substantially the full term of the financial instrument. Level 3 – Unobservable inputs that are significant to the fair value measurement. A financial instrument’s categorization within the valuation hierarchy is based upon the lowest level of input that is significant to the fair value measurement.
Deferred Costs	Deferred Costs Costs relating to the financing of properties are deferred and amortized over the life of the related financing agreement. Amortization is reflected as interest expense in the Consolidated Statements of Operations, with remaining terms ranging from 6 months to 40 years. Unamortized financing costs are written off when the financing agreement is extinguished before the maturity date.
Related Parties	Related Parties We apply ASC Topic 805, “Business Combinations”, to evaluate business relationships. Related parties are persons or entities who have one or more of the following characteristics, which include entities for which investments in their equity securities would be required, trust for the benefit of persons including principal owners of the entities and members of their immediate families, management personnel of the entity and members of their immediate families and other parties with which the entity may deal if one party controls or can significantly influence the decision making of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests, or affiliates of the entity.
Newly Issued Accounting Standards	Newly Issued Accounting Pronouncements In April 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-08, “Reporting Discontinued Operations and Disclosures of Disposals of Components of an Entity”, which changes the criteria for determining which disposals qualify to be accounted for as discontinued operations and modifies related reporting and disclosure requirements. Disposals representing a strategic shift in operations, such as change in a major line of business, a major geographical area or major equity investment, that have a major effect on a company’s operations and financial results will be presented as discontinued operations. If the disposal does qualify as a discontinued operation under ASU 2014-08, the company will be required to expand their disclosures about discontinued operations to provide more information on the assets, liabilities, income and expenses of the disposed of component. The classification of operating results as discontinued operations are applied retroactively for all periods presented. The new standard was effective January 1, 2015. We adopted ASU 2014-08 as of January 1, 2015 and believe future sales of our individual operating properties will no longer qualify as discontinued operations. Adoption of this standard has resulted in substantially fewer of the Company’s dispositions meeting the discontinued operations criteria. See Note 8 below. In May 2014, Accounting Standards Update (“ASU”) No. 2014-09 (“ASU 2014-09”), “Revenue from Contracts with Customers,” was issued. This new guidance established a new single comprehensive revenue recognition model and provides for enhanced disclosures. Under the new guidance, the nature, timing and amount of revenue recognized for certain transactions could differ from those recognized under existing accounting guidance. This new guidance does not affect revenue recognized under lease contracts. ASU 2014-09 is effective for reporting periods beginning after December 15, 2017. The Company is currently evaluating the impact the adoption of this guidance, if any, on its financial position and results of operations. In April 2015, the FASB issued ASU 2015-03, “Simplifying the Presentation of Debt Issuance Costs” (“ASU 2015-03”). ASU 2015-03 requires debt issuance costs to be presented in the balance sheet as a direct deduction from the carrying value of the associated debt liability, consistent with the presentation of a debt discount. Prior to the issuance of the standard, debt issuance costs were required to be presented in the balance sheet as an asset. The Company has adopted this standard effective June 30, 2015. The accompanying financials have been reclassified to reflect the adoption.

REAL ESTATE ACTIVITY (Tables)

REAL ESTATE ACTIVITY (Tables)	6 Months Ended
	Jun. 30, 2015
Real Estate [Abstract]
Schedule of the real estate owned	Below is a summary of the real estate owned as of June 30, 2015 (dollars in thousands): Apartments $ 546,904 Apartments under construction 3,261 Commercial properties 202,912 Land held for development 146,692 Real estate subject to sales contract 22,877 Total real estate $ 922,646 Less accumulated depreciation (130,235 ) Total real estate, net of depreciation $ 792,411

NOTES AND INTEREST RECEIVABLE (

NOTES AND INTEREST RECEIVABLE (Tables)	6 Months Ended
	Jun. 30, 2015
Receivables [Abstract]
Schedule of notes and interest receivable	O ur mortgage notes receivable consist of first, wraparound and junior mortgage loans (dollars in thousands): Maturity Interest Borrower Date Rate Amount Security Performing loans: Foundation for Better Housing, Inc. (Overlook at Allensville) (1) 11/19 12.00 % 2,472 Secured Foundation for Better Housing, Inc. (Overlook at Allensville) (1) 12/17 12.00 % 1,408 Secured Foundation for Better Housing, Inc. (Vista Ridge) (1) 04/19 12.00 % 3,923 Secured Foundation for Better Housing, Inc. (Vista Ridge) (1) 06/17 12.00 % 1,492 Secured H198, LLC (Las Vegas Land) 01/20 12.00 % 5,907 Secured Unified Housing Foundation, Inc. (Echo Station) (1) 09/17 12.00 % 1,481 100% Interest in Unified Housing of Temple, LLC Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00 % 2,000 Unsecured Unified Housing Foundation, Inc. (Lakeshore Villas) (1) 12/32 12.00 % 6,363 Membership interest in Housing for Seniors of Humble, LLC Unified Housing Foundation, Inc. (Limestone Canyon) (1) 12/32 12.00 % 4,663 100% Interest in Unified Housing of Austin, LLC Unified Housing Foundation, Inc. (Limestone Canyon) (1) 12/32 12.00 % 3,057 100% Interest in Unified Housing of Austin, LLC Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00 % 6,000 100% Interest in Unified Housing of Vista Ridge, LLC Unified Housing Foundation, Inc. (Limestone Ranch) (1) 12/32 12.00 % 2,250 100% Interest in Unified Housing of Vista Ridge, LLC Unified Housing Foundation, Inc. (Parkside Crossing) (1) 12/32 12.00 % 1,936 100% Interest in Unified Housing of Parkside Crossing, LLC Unified Housing Foundation, Inc. (Sendero Ridge) (1) 12/32 12.00 % 4,812 100% Interest in Unified Housing of Sendero Ridge, LLC Unified Housing Foundation, Inc. (Sendero Ridge) (1) 12/32 12.00 % 5,174 100% Interest in Unified Housing of Sendero Ridge, LLC Unified Housing Foundation, Inc. (Timbers of Terrell) (1) 12/32 12.00 % 1,323 100% Interest in Unified Housing of Terrell, LLC Unified Housing Foundation, Inc. (Tivoli) (1) 12/32 12.00 % 7,966 100% Interest in Unified Housing of Tivoli, LLC Unified Housing Foundation, Inc. (1) 06/17 12.00 % 1,261 Unsecured Unified Housing Foundation, Inc. (1) 12/17 12.00 % 1,207 Unsecured Other related party notes (1) Various Various 768 Various secured interests Other related party notes (1) Various Various 4,929 Various unsecured interests Other non-related party notes Various Various 496 Various secured interests Other non-related party notes Various Various 503 Various unsecured interests Accrued interest 4,862 Total Performing $ 76,253 Non-Performing loans: Other non-related party notes Various Various 507 Secured Accrued interest 97 Total Non-Performing $ 604 Allowance for doubtful accounts (1,990 ) Total $ 74,867 (1)

INVESTMENT IN UNCONSOLIDATED 24

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES (Tables)	6 Months Ended
	Jun. 30, 2015
Equity Method Investments and Joint Ventures [Abstract]
Schedule of investments accounted for via the equity method	Investments in unconsolidated joint ventures and investees consist of the following: Percentage ownership as of June 30, 2015 June 30, 2014 American Realty Investors, Inc. (1) 1.00 % 1.99 % (1)
Schedule of the financial position and results of operations - unconsolidated parent	The following is a summary of the financial position and results of operations from our unconsolidated parent (dollars in thousands): As of June 30, 2015 2014 Real estate, net of accumulated depreciation $ 14,285 $ 15,149 Notes receivable 50,519 68,940 Other assets 127,217 128,581 Notes payable (28,193 ) (52,369 ) Other liabilities (94,201 ) (100,149 ) Shareholders' equity (69,627 ) (60,152 ) For the Six Months Ended June 30, 2015 2014 Rents and interest and other income $ 6,359 $ 5,894 Depreciation (78 ) (138 ) Operating expenses (1,810 ) (3,093 ) Interest expense (1,448 ) (3,447 ) Income (loss) from continuing operations 3,023 (784 ) Income (loss) from discontinued operations — — Net income (loss) $ 3,023 $ (784 ) Company's proportionate share of income (loss) $ 30 $ (16 )

NOTES PAYABLE (Tables)

NOTES PAYABLE (Tables)	6 Months Ended
	Jun. 30, 2015
Debt Disclosure [Abstract]
Schedule of Notes And Interest Payable	Below is a summary of our notes and interest payable as of June 30, 2015 (dollars in thousands): Notes Payable Accrued Interest Total Debt Apartments $ 443,429 $ 1,316 $ 444,745 Commercial 117,392 494 117,886 Land 56,917 116 57,033 Real estate subject to sales contract 16,547 1,705 18,252 Mezzanine financing 123,900 — 123,900 Other 4,530 — 4,530 Total $ 762,715 $ 3,631 $ 766,346 Unamortized deferred borrowing costs (19,962 ) — (19,962 ) Total $ 742,753 $ 3,631 $ 746,384

RELATED PARTY TRANSACTIONS (Tab

RELATED PARTY TRANSACTIONS (Tables)	6 Months Ended
	Jun. 30, 2015
Related Party Transactions [Abstract]
Schedule of Related Party Transactions	The following table reconciles the beginning and ending balances of accounts receivable from and (accounts payable) to related parties as of June 30, 2015 (dollars in thousands): Pillar ARL Total Related party receivable, December 31, 2014 $ — $ 58,404 $ 58,404 Cash transfers 38,073 — 38,073 Advisory fees (3,893 ) — (3,893 ) Net income fee (90 ) — (90 ) Fees and commissions (2,391 ) — (2,391 ) Cost reimbursements (1,457 ) — (1,457 ) Interest income — 1,297 1,297 Expenses paid by advisor (4,993 ) — (4,993 ) Financing (mortgage payments) 3,381 — 3,381 Sales/purchases transactions 5,749 — 5,749 Purchase of obligations (34,379 ) 34,379 — Related party receivable, June 30, 2015 $ — $ 94,080 $ 94,080

OPERATING SEGMENTS (Tables)

OPERATING SEGMENTS (Tables)	6 Months Ended
	Jun. 30, 2015
Segment Reporting [Abstract]
Schedule of operating segment, including segment assets and expenditures	Presented below is our reportable segments’ operating income for the three and six months ended June 30, 2015 and 2014, including segment assets and expenditures (dollars in thousands): For the Three Months Ended June 30, 2015 Commercial Apartments Land Other Total Rental and other property revenues $ 6,678 $ 17,070 $ — $ 8 $ 23,756 Property operating expenses (3,134 ) (7,693 ) (129 ) 27 (10,929 ) Depreciation (2,197 ) (2,910 ) — — (5,107 ) Mortgage and loan interest (1,639 ) (3,293 ) (1,193 ) (2,091 ) (8,216 ) Interest income — — — 2,994 2,994 Gain on land sales — — 1,250 — 1,250 Segment operating income (loss) $ (292 ) $ 3,174 $ (72 ) $ 938 $ 3,748 Capital expenditures 2,940 1,498 485 — 4,923 Real estate assets 160,403 476,391 155,617 — 792,411 Property Sales Sales price $ — $ — $ 1,878 $ — $ 1,878 Cost of sale — — (628 ) — (628 ) Gain on sale $ — $ — $ 1,250 $ — $ 1,250 For the Three Months Ended June 30, 2014 Commercial Apartments Land Other Total Rental and other property revenues $ 4,425 $ 14,072 $ — $ 14 $ 18,511 Property operating expenses (2,968 ) (6,187 ) (204 ) — (9,359 ) Depreciation (1,733 ) (2,538 ) — — (4,271 ) Mortgage and loan interest (1,546 ) (3,754 ) (1,348 ) (1,221 ) (7,869 ) Interest income — — — 4,005 4,005 Loss on land sales — — (159 ) — (159 ) Segment operating income (loss) $ (1,822 ) $ 1,593 $ (1,711 ) $ 2,798 $ 858 Capital expenditures 1,859 99 66 — 2,024 Real estate assets 129,607 374,022 157,623 — 661,252 Property Sales Sales price $ 16,600 $ — $ 717 $ — $ 17,317 Cost of sale (9,597 ) — (876 ) — (10,473 ) Gain (loss) on sale $ 7,003 $ — $ (159 ) $ — $ 6,844 For the Six Months Ended June 30, 2015 Commercial Apartments Land Other Total Rental and other property revenues $ 13,464 $ 32,543 $ — $ 53 $ 46,060 Property operating expenses (7,147 ) (14,353 ) (310 ) 17 (21,793 ) Depreciation (4,092 ) (5,659 ) — — (9,751 ) Mortgage and loan interest (3,245 ) (9,364 ) (2,197 ) (3,595 ) (18,401 ) Interest income — — — 6,755 6,755 Gain on land sales — — 4,126 — 4,126 Segment operating income (loss) $ (1,020 ) $ 3,167 $ 1,619 $ 3,230 $ 6,996 Capital expenditures 6,132 1,755 1,311 — 9,198 Real estate assets 160,403 476,391 155,617 — 792,411 Property Sales Sales price $ — $ — $ 9,135 $ — $ 9,135 Cost of sale — — (5,009 ) — (5,009 ) Gain on sale $ — $ — $ 4,126 $ — $ 4,126 For the Six Months Ended June 30, 2014 Commercial Properties Apartments Land Other Total Rental and other property revenues $ 8,875 $ 27,917 $ — $ 22 $ 36,814 Property operating expenses (5,845 ) (12,319 ) (393 ) (5 ) (18,562 ) Depreciation (3,524 ) (5,028 ) — — (8,552 ) Mortgage and loan interest (2,975 ) (9,949 ) (2,488 ) (1,456 ) (16,868 ) Interest income — — — 6,118 6,118 Gain on land sales — — 594 — 594 Segment operating income (loss) $ (3,469 ) $ 621 $ (2,287 ) $ 4,679 $ (456 ) Capital expenditures 2,989 99 151 # — 3,239 Real estate assets 129,607 374,022 157,623 — 661,252 Property Sales Sales price $ 16,600 $ 23,131 $ 2,367 $ — $ 42,098 Cost of sale (9,597 ) (17,077 ) (1,773 ) — (28,447 ) Gain on sale $ 7,003 $ 6,054 $ 594 $ — $ 13,651
Schedule of Segment information to Consolidated Statements of Operations	The table below reconciles the segment information to the corresponding amounts in the Consolidated Statements of Operations (dollars in thousands): For the Three Months Ended June 30, 2015 2014 Segment operating income $ 3,748 $ 858 Other non-segment items of income (expense) General and administrative (1,278 ) (2,738 ) Net income fee to related party (45 ) (210 ) Advisory fee to related party (1,951 ) (1,811 ) Other income 14 244 Earnings (loss) from unconsolidated joint ventures and investees 10 (11 ) Litigation settlement (45 ) (86 ) Income tax benefit (expense) (12 ) 2,195 Net income (loss) from continuing operations $ 441 $ (1,559 ) The tables below reconcile the segment information to the corresponding amounts in the Consolidated Statements of Operations: For the Six Months Ended June 30, 2015 2014 Segment operating income (loss) $ 6,996 $ (456 ) Other non-segment items of income (expense) General and administrative (3,045 ) (4,287 ) Net income fee to related party (90 ) (700 ) Advisory fee to related party (3,894 ) (3,664 ) Other income 81 396 Earnings (loss) from unconsolidated joint ventures and investees 43 (16 ) Litigation settlement (118 ) 3,753 Income tax benefit 90 4,244 Net income (loss) from continuing operations $ 63 $ (730 )
Schedule of Segment information to Consolidated Balance Sheets	The table below reconciles the segment information to the corresponding amounts in the Consolidated Balance Sheets (dollars in thousands): As of June 30, 2015 2014 Segment assets $ 792,411 $ 661,252 Investments in real estate partnerships 2,155 1,509 Notes and interest receivable 74,867 69,074 Other assets 198,561 135,730 Total assets $ 1,067,994 $ 867,565 The tables below reconcile the segment information to the corresponding amounts in the Consolidated Balance Sheets: As of June 30, 2015 2014 Segment assets $ 792,411 $ 661,252 Investments in real estate partnerships 2,155 1,509 Notes and interest receivable 74,867 69,074 Other assets 198,561 135,730 Total assets $ 1,067,994 $ 867,565

DISCONTINUED OPERATIONS (Tables

DISCONTINUED OPERATIONS (Tables)	6 Months Ended
	Jun. 30, 2015
Discontinued Operations and Disposal Groups [Abstract]
Schedule of summarizes revenue and expense information for the properties sold and held for sale	The following table summarizes revenue and expense information for the properties sold and held for sale (dollars in thousands): For the Three Months Ended June 30, For the Six Months Ended June 30, 2015 2014 2015 2014 Revenues: Rental and other property revenues $ — $ 1,341 $ 15 $ 3,912 — 1,341 15 3,912 Expenses: Property operating expenses 26 557 (348 ) 1,875 Depreciation — 179 — 509 General and administrative 7 140 104 313 Total operating expenses 33 876 (244 ) 2,697 Other income (expense): Other income — (528 ) — (486 ) Mortgage and loan interest (1 ) (464 ) (1 ) (1,410 ) Litigation settlement — (205 ) — (250 ) Total other expenses (1 ) (1,197 ) (1 ) (2,146 ) Gain (loss) from discontinued operations before gain on sale of real estate and tax (34 ) (732 ) 258 (931 ) Gain on sale of real estate from discontinued operations — 7,003 — 13,057 Income tax benefit (expense) 12 (2,195 ) (90 ) (4,244 ) Income (loss) from discontinued operations $ (22 ) $ 4,076 $ 168 $ 7,882

ORGANIZATION AND BASIS OF PRE29

ORGANIZATION AND BASIS OF PRESENTATION (Details Narrative) - Jun. 30, 2015	ft²Number
Number of properties	52
Area of real estate property | ft²	1,900,000
Acres of land | ft²	4,044
Buildings and Improvements [Member] | Maximum [Member]
Use life	40 years
Buildings and Improvements [Member] | Minimum [Member]
Use life	10 years
Furniture, Fixtures and Equipment [Member] | Maximum [Member]
Use life	10 years
Furniture, Fixtures and Equipment [Member] | Minimum [Member]
Use life	5 years
Transcontinential Realty Investors [Member]
Percentage of ownership	80.90%
Transcontinential Realty Investors [Member] | Income Opportunity Reality Investors [Member]
Percentage of ownership	81.10%
Apartments [Member]
Number of units	7,085
Number of properties	43

REAL ESTATE ACTIVITY (Details N

REAL ESTATE ACTIVITY (Details Narrative) - Jun. 30, 2015 $ in Thousands	USD ($)Number
Number of income-producing apartment purchase	52
Proceeds from sale of real estate | $	$ (6,539)
Payment for construction or predevelopment of various apartment complexes | $	3,200
Capitalized interest costs | $	$ 25,109
Related Party [Member]
Number of income-producing apartment purchase	3
Number of units	349
Payment to acquire the properties | $	$ 11,600
TEXAS [Member]
Number of income-producing apartment purchase	2
Proceeds from sale of real estate | $	$ 9,100
Gain on sale of real estate | $	$ 4,100
TEXAS [Member] | Related Party [Member]
Number of income-producing apartment purchase	2
KANSAS [Member]
Number of income-producing apartment purchase	1
KANSAS [Member] | Related Party [Member]
Number of income-producing apartment purchase	1
Apartments - New Acqusitions [Member]
Number of income-producing apartment purchase	3
Number of units	698
Payment to acquire the properties | $	$ 31,500
Office Building [Member] | TEXAS [Member]
Payment to acquire the properties | $	$ 16,800

REAL ESTATE ACTIVITY (Details)

REAL ESTATE ACTIVITY (Details) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014
Real Estate [Abstract]
Apartments	$ 546,904
Apartments under construction	3,261
Commercial properties	202,912
Land held for development	146,692
Real estate subject to sales contract	22,877
Total real estate	922,646
Less accumulated depreciation	(130,235)
Total real estate	$ 792,411	$ 689,121

NOTES AND INTEREST RECEIVABLE32

NOTES AND INTEREST RECEIVABLE (Details) - Jun. 30, 2015 - USD ($) $ in Thousands		Total
Allowance for doubtful accounts		$ (1,990)
Total		74,867
Performing Loans [Member]
Accrued interest		4,862
Total		$ 76,253
Performing Loans [Member] | Foundation for Better Housing, Inc. (Overlook at Allensville) [Member]
Maturity Date		2019-11
Interest rate		12.00%
Amount	[1]	$ 2,472
Description of security		Secured
Performing Loans [Member] | Foundation for Better Housing, Inc. (Overlook at Allensville) [Member]
Maturity Date		2017-12
Interest rate		12.00%
Amount	[1]	$ 1,408
Description of security		Secured
Performing Loans [Member] | Foundation for Better Housing, Inc. (Vista Ridge) [Member]
Maturity Date		2019-04
Interest rate		12.00%
Amount	[1]	$ 3,923
Description of security		Secured
Performing Loans [Member] | Foundation for Better Housing, Inc. (Vista Ridge) [Member]
Maturity Date		2017-06
Interest rate		12.00%
Amount	[1]	$ 1,492
Description of security		Secured
Performing Loans [Member] | H198, LLC (Las Vegas Land) [Member]
Maturity Date		2020-01
Interest rate		12.00%
Amount	[1]	$ 5,907
Description of security		Secured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Echo Station) [Member]
Maturity Date		2017-09
Interest rate		12.00%
Amount	[1]	$ 1,481
Security		$ 100
Description of security		100% Interest in Unified Housing of Temple, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Lakeshore Villas) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 2,000
Description of security		Unsecured
Performing Loans [Member] | Unified Housing Foundation, Inc. (Lakeshore Villas) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 6,363
Description of security		Membership interest in Housing for Seniors of Humble, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Limestone Canyon) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 3,057
Security		$ 100
Description of security		100% Interest in Unified Housing of Austin, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Limestone Canyon) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 4,663
Security		$ 100
Description of security		100% Interest in Unified Housing of Austin, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Limestone Ranch) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 2,250
Security		$ 100
Description of security		100% Interest in Unified Housing of Vista Ridge, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Limestone Ranch) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 6,000
Security		$ 100
Description of security		100% Interest in Unified Housing of Vista Ridge, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Parkside Crossing) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 1,936
Security		$ 100
Description of security		100% Interest in Unified Housing of Parkside Crossing, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Sendero Ridge) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 5,174
Security		$ 100
Description of security		100% Interest in Unified Housing of Sendero Ridge, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Sendero Ridge) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 4,812
Security		$ 100
Description of security		100% Interest in Unified Housing of Sendero Ridge, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Timbers of Terrell) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 1,323
Security		$ 100
Description of security		100% Interest in Unified Housing of Terrell, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. (Tivoli) [Member]
Maturity Date		2032-12
Interest rate		12.00%
Amount	[1]	$ 7,966
Security		$ 100
Description of security		100% Interest in Unified Housing of Tivoli, LLC
Performing Loans [Member] | Unified Housing Foundation, Inc. [Member]
Maturity Date		2017-06
Interest rate		12.00%
Amount	[1]	$ 1,261
Description of security		Unsecured
Performing Loans [Member] | Unified Housing Foundation, Inc. [Member]
Maturity Date		2017-12
Interest rate		12.00%
Amount	[1]	$ 1,207
Description of security		Unsecured
Performing Loans [Member] | Other related party notes [Member]
Description of Maturity Date		Various
Description of Interest rate		Various
Amount	[1]	$ 768
Description of security		Various secured interests
Performing Loans [Member] | Other related party notes [Member]
Description of Maturity Date		Various
Description of Interest rate		Various
Amount	[1]	$ 4,929
Description of security		Various unsecured interests
Performing Loans [Member] | Other non-related party notes [Member]
Description of Maturity Date		Various
Description of Interest rate		Various
Amount		$ 496
Description of security		Various secured interests
Performing Loans [Member] | Other non-related party notes [Member]
Description of Maturity Date		Various
Description of Interest rate		Various
Amount		$ 503
Description of security		Various unsecured interests
Non-Performing Loans [Member]
Accrued interest		$ 97
Total		$ 604
Non-Performing Loans [Member] | Other non-related party notes [Member]
Description of Maturity Date		Various
Description of Interest rate		Various
Amount		$ 507
Description of security		Secured interests
[1]	Related party notes.

INVESTMENT IN UNCONSOLIDATED 33

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES (Details Narrative)		Jun. 30, 2015	Dec. 31, 2014
American Realty Investors, Inc [Member]
Percentage of ownership	[1]	1.00%	1.99%
[1]	Unconsolidated investment in parent company owning 140,000 shares of ARL Common Stock

INVESTMENT IN UNCONSOLIDATED 34

INVESTMENT IN UNCONSOLIDATED JOINT VENTURES AND INVESTEES (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Total real estate, net of depreciation	$ 792,411		$ 792,411		$ 689,121
Other assets	33,287		33,287		37,441
Notes payable	(727,222)		(727,222)		(588,749)
Shareholders' equity	(215,081)		(215,081)		$ (215,284)
Revenue	23,756	$ 18,511	46,060	$ 36,814
Depreciation	(5,107)	(4,271)	(9,751)	(8,552)
Operating expenses	19,310	18,389	38,573	35,765
Income from discontinued operations	(22)	4,076	168	7,882
Net income	419	2,517	231	7,152
Company's proportionate share of earnings	10	(11)	43	(16)
American Realty Investors, Inc [Member]
Total real estate, net of depreciation	14,285	15,149	14,285	15,149
Notes receivable	50,519	68,940	50,519	68,940
Other assets	127,217	128,581	127,217	128,581
Notes payable	(28,193)	(52,369)	(28,193)	(52,369)
Other liabilities	(94,201)	(100,149)	(94,201)	(100,149)
Shareholders' equity	$ (69,627)	$ (60,152)	(69,627)	(60,152)
Revenue			6,359	5,894
Depreciation			(78)	(138)
Operating expenses			(1,810)	(3,093)
Interest expense			(1,448)	(3,447)
Income from continuing operations			3,023	(784)
Net income			3,023	(784)
Company's proportionate share of earnings			$ 30	$ (16)

NOTES PAYABLE (Details Narrativ

NOTES PAYABLE (Details Narrative) $ in Thousands	May. 28, 2015USD ($)	Apr. 29, 2015USD ($)Number	Apr. 23, 2015USD ($)Number	Jan. 28, 2015Number	Jun. 30, 2015USD ($)
Notes oustanding balance					$ 746,384
Mortgage Notes Payable [Member] | TEXAS [Member]
Number of units | Number				200
Interest rate				3.24%
Description of frequency payment				Monthly
Maturity date				Aug. 1, 2050
Mortgage Notes Payable [Member] | MISSISSIPPI [Member]
Number of units | Number				240
Interest rate				3.24%
Description of frequency payment				Monthly
Maturity date				Dec. 1, 2051
New Mortgage Notes Payable [Member] | ARKANSAS [Member]
Number of units | Number			250
Interest rate			2.74%
Description of frequency payment			Monthly
Maturity date			May 1, 2050
Notes Payable			$ 21,000
Repayment of notes payable			15,700
Repayment of notes payable closing cost			$ 600
New Mortgage Notes Payable [Member] | TEXAS [Member]
Number of units | Number		240
Interest rate		3.28%
Description of frequency payment		Monthly
Maturity date		Mar. 31, 2051
Notes Payable		$ 15,400
Repayment of notes payable closing cost		$ 700
Secured Notes Payable [Member] | Independent Third Party [Member]
Description of frequency payment	Monthly
Notes Payable	$ 120,000
Notes oustanding balance	$ 84,400
Notes payable term	5 years
Description of interest rate	Interest rate of 30 day Libor plus 10.75%
Description of collteral	The loan is secured by various equity interests in certain residential apartments.
New Secured Notes Payable [Member] | Independent Third Party [Member]
Interest rate	12.00%
Description of frequency payment	Quarterly
Notes oustanding balance	$ 40,000				39,500
Notes payable term	5 years
Description of collteral	The loan is secured by various equity interests in residential apartments and can be prepaid at a penalty rate of 4% for year 1 with the penalty declining by 1% each year thereafter.
Notes payable principal payment	$ 500
Construction Loans [Member]
Notes oustanding balance					$ 1,700

NOTES PAYABLE (Details)

NOTES PAYABLE (Details) $ in Thousands	Jun. 30, 2015USD ($)
Notes Payable	$ 742,753
Accrued Interest	3,631
Total Debt	746,384
Unamortized deferred borrowing costs	(19,962)
Commercial [Member]
Notes Payable	117,392
Accrued Interest	494
Total Debt	117,886
Land [Member]
Notes Payable	56,917
Accrued Interest	116
Total Debt	57,033
Real Estate Subject to Sales Contract [Member]
Notes Payable	16,547
Accrued Interest	1,705
Total Debt	18,252
Mezzanine Financing [Member]
Notes Payable	$ 123,900
Accrued Interest
Total Debt	$ 123,900
Other [Member]
Notes Payable	$ 4,530
Accrued Interest
Total Debt	$ 4,530
Total Notes Payable [Member]
Notes Payable	762,715
Accrued Interest	3,631
Total Debt	766,346
Unamortized deferred borrowing costs	(19,962)
Apartments [Member]
Notes Payable	443,429
Accrued Interest	1,316
Total Debt	$ 444,745

RELATED PARTY TRANSACTIONS (Det

RELATED PARTY TRANSACTIONS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Related party receivable, December 31, 2014			$ 58,404
Advisory fee to related party	$ (1,951)	$ (1,811)	(3,894)	$ (3,664)
Net income fee to related party	(45)	$ (210)	(90)	$ (700)
Related party receivable, June 30, 2015	94,080		94,080
American Realty Investors, Inc [Member]
Related party receivable, December 31, 2014			58,404
Interest income			1,297
Purchase of obligations			34,379
Related party receivable, June 30, 2015	$ 94,080		94,080
Pillar Income Asset Management, Inc [Member]
Cash transfers			38,073
Advisory fee to related party			(3,893)
Net income fee to related party			(90)
Fees and commissions			(2,391)
Cost reimbursements			(1,457)
Expenses paid by Advisor			(4,993)
Financing (mortgage payments)			3,381
Sales/purchases transactions			5,749
Purchase of obligations			(34,379)
Related Party [Member]
Cash transfers			38,073
Advisory fee to related party			(3,893)
Net income fee to related party			(90)
Fees and commissions			(2,391)
Cost reimbursements			(1,457)
Interest income			1,297
Expenses paid by Advisor			(4,993)
Financing (mortgage payments)			3,381
Sales/purchases transactions			$ 5,749

OPERATING SEGMENTS (Details)

OPERATING SEGMENTS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014	Dec. 31, 2014
Segment Reporting Information [Line Items]
Rental and other property revenues	$ 23,756	$ 18,511	$ 46,060	$ 36,814
Property operating expenses	(10,929)	(9,359)	(21,793)	(18,562)
Depreciation	(5,107)	(4,271)	(9,751)	(8,552)
Mortgage and loan interest	(8,216)	(7,869)	(18,401)	(16,868)
Interest income	2,994	4,005	6,755	6,118
Gain on land sales	1,250	(159)	4,126	594
Segment operating income (loss)	3,748	858	6,996	(456)
Capital expenditures	4,923	2,024	9,198	3,239
Real estate assets	792,411		$ 792,411		$ 689,121
Property Sales
Gain (loss) on sale				13,057
Commercial Properties [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues	6,678	4,425	$ 13,464	8,875
Property operating expenses	(3,134)	(2,968)	(7,147)	(5,845)
Depreciation	(2,197)	(1,733)	(4,092)	(3,524)
Mortgage and loan interest	(1,639)	(1,546)	(3,245)	(2,975)
Segment operating income (loss)	(292)	(1,822)	(1,020)	(3,469)
Capital expenditures	2,940	1,859	6,132	2,989
Real estate assets	160,403	129,607	160,403	129,607
Property Sales
Sales price		16,600		16,600
Cost of sale		(9,597)		(9,597)
Gain (loss) on sale		7,003		7,003
Apartments [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues	17,070	14,072	32,543	27,917
Property operating expenses	(7,693)	(6,187)	(14,353)	(12,319)
Depreciation	(2,910)	(2,538)	(5,659)	(5,028)
Mortgage and loan interest	(3,293)	(3,754)	(9,364)	(9,949)
Segment operating income (loss)	3,174	1,593	3,167	621
Capital expenditures	1,498	99	1,755	99
Real estate assets	$ 476,391	$ 374,022	$ 476,391	374,022
Property Sales
Sales price				23,131
Cost of sale				(17,077)
Gain (loss) on sale				$ 6,054
Land [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues
Property operating expenses	$ (129)	$ (204)	$ (310)	$ (393)
Depreciation
Mortgage and loan interest	(1,193)	$ (1,348)	$ (2,197)	$ (2,488)
Interest income
Gain on land sales	1,250	$ (159)	$ 4,126	$ 594
Segment operating income (loss)	(72)	(1,711)	1,619	(2,287)
Capital expenditures	485	66	1,311	151
Real estate assets	155,617	157,623	155,617	157,623
Property Sales
Sales price	1,878	717	9,135	2,367
Cost of sale	(628)	(876)	(5,009)	(1,773)
Gain (loss) on sale	1,250	(159)	4,126	594
Other [Member]
Segment Reporting Information [Line Items]
Rental and other property revenues	8	$ 14	53	22
Property operating expenses	27		$ 17	$ (5)
Depreciation
Mortgage and loan interest	(2,091)	$ (1,221)	$ (3,595)	$ (1,456)
Interest income	2,994	$ 4,005	$ 6,755	$ 6,118
Gain on land sales
Segment operating income (loss)	938	$ 2,798	$ 3,230	$ 4,679
Total Segments [Member]
Segment Reporting Information [Line Items]
Real estate assets	792,411	661,252	792,411	661,252
Property Sales
Sales price	1,878	17,317	9,135	42,098
Cost of sale	(628)	(10,473)	(5,009)	(28,447)
Gain (loss) on sale	$ 1,250	$ 6,844	$ 4,126	$ 13,651

OPERATING SEGMENTS (Details 1)

OPERATING SEGMENTS (Details 1) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Segment Reporting [Abstract]
Segment operating income	$ 3,748	$ 858	$ 6,996	$ (456)
Other non-segment items of income (expense)
General and administrative	(1,278)	(2,738)	(3,045)	(4,287)
Net income fee to related party	45	210	90	700
Advisory fee to related party	1,951	1,811	3,894	3,664
Other income	14	244	81	396
Earnings (loss) from unconsolidated joint ventures and investees	10	(11)	43	(16)
Litigation settlement (expense)	(45)	(86)	(118)	3,753
Income tax benefit (expense)	(12)	2,195	90	4,244
Net income (loss) from continuing operations	$ 441	$ (1,559)	$ 63	$ (730)

OPERATING SEGMENTS (Details 2)

OPERATING SEGMENTS (Details 2) - USD ($) $ in Thousands	Jun. 30, 2015	Dec. 31, 2014	Jun. 30, 2014
Segment assets	$ 792,411	$ 689,121
Investments in real estate partnerships	2,155	1,543
Other assets	33,287	37,441
Total assets	1,067,994	$ 930,405
Total Segments [Member]
Segment assets	792,411		$ 661,252
Investments in real estate partnerships	2,155		1,509
Notes and interest receivable	74,867		69,074
Other assets	198,561		135,730
Total assets	$ 1,067,994		$ 867,565

DISCONTINUED OPERATIONS (Detail

DISCONTINUED OPERATIONS (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2015	Jun. 30, 2014	Jun. 30, 2015	Jun. 30, 2014
Revenues:
Rental and other property revenues		$ 1,341	$ 15	$ 3,912
Revenues		1,341	15	3,912
Expenses:
Property operating expenses	$ 26	557	$ (348)	1,875
Depreciation		179		509
General and administrative	$ 7	140	$ 104	313
Total operating expenses	$ 33	876	$ (244)	2,697
Other income (expense):
Other income		(528)		(486)
Mortgage and loan interest	$ (1)	(464)	$ (1)	(1,410)
Litigation settlement		(205)		(250)
Total other expenses	$ (1)	(1,197)	$ (1)	(2,146)
Gain (loss) from discontinued operations before gain on sale of real estate and tax	$ (34)	(732)	$ 258	(931)
Gain on sale of real estate from discontinued operations		7,003		13,057
Income tax benefit (expense)	$ 12	(2,195)	$ (90)	(4,244)
Income (loss) from discontinued operations	$ (22)	$ 4,076	$ 168	$ 7,882

COMMITMENTS AND CONTINGENCIES42

COMMITMENTS AND CONTINGENCIES AND LIQUIDITY (Details Narrative) - Related Party Domain - USD ($) $ in Thousands	1 Months Ended
	Feb. 28, 2014	Oct. 31, 2011	Jun. 30, 2015
Notes oustanding balance			$ 746,384
Clapper Parties [Member]
Damages sought value		$ 74,000
Actual damages sought value		26,000
Interest damages sought value		$ 48,000
Description of plaintiff		Mr. David Clapper and entities related to Mr. Clapper
Description of defendant		A formerly owned entity (American Realty Trust, Inc.) and its former subsidiary (ART Midwest, Inc.)
Description of allegation		Originally arising out of a transaction in 1998, in which ART and the Clapper Parties were to form a partnership to own eight residential apartment complexes.
Description of action taken by court	The Court of Appeals affirmed a portion of the judgment in favor of the Clapper Parties, but also ruled that a double counting of a significant portion of the damages had occurred and remanded the case back to the trial court to recalculate the damage award, as well as pre and post-judgment interest thereon.

EARNINGS PER SHARE (Details Nar

EARNINGS PER SHARE (Details Narrative) - USD ($) $ / shares in Units, $ in Thousands	Jul. 09, 2014	Jun. 30, 2015	Dec. 31, 2014
Stock options outstanding			5,000
Series C Cumulative Convertible Preferred Stock [Member]
Preferred stock outstanding"		30,000
Description of conversion basic		The stock had a liquidation preference of $100 per share and could be converted into common stock at 90% of the daily average closing price of the common stock for the prior five trading days.
Preferred stock, liquidation preference per share		$ 100
Series C Cumulative Convertible Preferred Stock [Member] | RAI [Member]
Preferred stock outstanding"	30,000
Accrued dividends unpaid	$ 900
Number of preferred stock converted	30,000
Number of common stock issued for conversion	304,298