Document and Entity Information
Document and Entity Information - USD ($) | 12 Months Ended | ||
Jan. 31, 2018 | May 01, 2018 | Jul. 31, 2017 | |
Document And Entity Information | |||
Entity Registrant Name | INNSUITES HOSPITALITY TRUST | ||
Entity Central Index Key | 82,473 | ||
Document Type | 10-K | ||
Document Period End Date | Jan. 31, 2018 | ||
Amendment Flag | false | ||
Current Fiscal Year End Date | --01-31 | ||
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 Public Float | $ 5,258,184 | ||
Entity Common Stock, Shares Outstanding | 9,764,907 | ||
Trading Symbol | IHT | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2,018 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 |
Current Assets: | ||
Cash and Cash Equivalents | $ 4,776,453 | $ 478,835 |
Short-Term Investments - Available For Sale Securities | 1,000,330 | |
Accounts Receivable, including $15,113 and $1,783 from related parties and net of Allowance for Doubtful Accounts of $28,564 and $53,720 as of January 31, 2018 and 2017, respectively | 344,108 | 626,174 |
Advances to Affiliates - Related Party | 970,353 | |
Notes Receivable - Related Party | 810,799 | |
Prepaid Expenses and Other Current Assets | 164,278 | 130,831 |
Current Assets of Discontinued Operations | 229,127 | |
Total Current Assets | 8,066,321 | 1,464,967 |
Property, Plant and Equipment, net | 15,011,751 | 13,694,268 |
Intangible Assets, net | 433,000 | |
Goodwill | 500,000 | |
Noncurrent assets of Discontinued Operations | 6,080,597 | |
TOTAL ASSETS | 23,078,072 | 22,172,832 |
Current Liabilities: | ||
Accounts Payable and Accrued Expenses | 2,211,176 | 1,763,498 |
Lending From Affiliates - Related Party | 379,167 | |
Current Portion of Notes Payable - Related Party | 296,315 | 145,000 |
Current Portion of Mortgage Notes Payable, net of Discount of $2,628 and $8,012 as of January 31, 2018 and 2017, respectively | 254,460 | 320,193 |
Current Portion of Notes Payable to Banks, net of Discount of $3,680 and $39,796 as of January 31, 2018 and 2017, respectively | 144,185 | 646,376 |
Current Portion of Other Notes Payable | 1,059,349 | 565,657 |
Current Liabilities of Discontinued Operations | 86,976 | 585,609 |
Total Current Liabilities | 4,052,461 | 4,405,500 |
Notes Payable - Related Party | 494,258 | |
Mortgage Notes Payable, net of discount of $13,868 and $50,894 as of January 31, 2018 2017, respectively | 9,499,875 | 7,755,564 |
Notes Payable to Banks, net of discount of $4,902 and $2,316 as of January 31, 2018 and 2017, respectively | 808,028 | 1,331,270 |
Other Notes Payable | 104,481 | 7,411 |
Noncurrent Liabilities of Discontinued Operations | 5,047,838 | |
TOTAL LIABILITIES | 14,959,103 | 18,547,583 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS' EQUITY | ||
Shares of Beneficial Interest, without par value, unlimited authorization; 18,572,215 and 18,292,601 shares issued and 9,775,669 and 9,665,328 shares outstanding at January 31, 2018 and January 31, 2017, respectively | 22,333,905 | 16,794,132 |
Treasury Stock, 8,796,546 and 8,645,573 shares held at cost at January 31, 2017 and January 31, 2017, respectively | (12,662,996) | (12,362,952) |
TOTAL TRUST SHAREHOLDERS' EQUITY | 9,670,909 | 4,431,180 |
NON-CONTROLLING INTEREST | (1,551,940) | (805,931) |
TOTAL EQUITY | 8,118,969 | 3,625,249 |
TOTAL LIABILITIES AND EQUITY | $ 23,078,072 | $ 22,172,832 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Accounts Receivable from related parties | $ 15,113 | $ 1,783 |
Allowance for doubtful accounts receivable | 28,564 | $ 53,720 |
Note payable, discount | $ 6,000 | |
Shares of Beneficial Interest, without par value | ||
Shares of Beneficial Interest, authorized shares | Unlimited | Unlimited |
Shares of Beneficial Interest, shares issued | 18,572,215 | 18,292,601 |
Shares of Beneficial Interest, shares outstanding | 9,775,669 | 9,665,328 |
Treasury Stock, shares held | 8,796,546 | 8,645,573 |
Current Portion of Mortgage Notes Payable [Member] | ||
Note payable, discount | $ 2,628 | $ 8,012 |
Current Portion of Notes Payable to Banks [Member] | ||
Note payable, discount | 3,680 | 39,796 |
Mortgage Notes Payable [Member] | ||
Note payable, discount | 13,868 | 50,894 |
Notes Payable to Banks [Member] | ||
Note payable, discount | $ 4,902 | $ 2,316 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
REVENUE | ||
Room | $ 9,281,199 | $ 8,124,592 |
Food and Beverage | 62,969 | 31,936 |
Management and Trademark Fees | 200,457 | 296,176 |
Reservation and Convention | 1,111,775 | 669,533 |
Other | 111,192 | 74,942 |
TOTAL REVENUE | 10,767,592 | 9,197,179 |
OPERATING EXPENSES | ||
Room | 2,732,908 | 2,422,225 |
Food and Beverage | 90,543 | 91,249 |
Telecommunications | 37,145 | 24,018 |
General and Administrative | 4,349,086 | 3,950,659 |
Sales and Marketing | 1,796,338 | 1,280,073 |
Reservation Acquisition Costs | 234,169 | |
Repairs and Maintenance | 695,992 | 690,386 |
Hospitality | 639,293 | 583,380 |
Utilities | 565,028 | 561,013 |
Depreciation | 1,291,371 | 1,395,572 |
Goodwill Impairment | 500,000 | |
Intangible Amortization | 433,000 | 67,000 |
Real Estate and Personal Property Taxes, Insurance and Ground Rent | 488,373 | 509,353 |
Other | 29,153 | (22,282) |
TOTAL OPERATING EXPENSES | 13,882,399 | 11,552,646 |
OPERATING LOSS | (3,114,807) | (2,355,467) |
Interest Income | 11,641 | 1,359 |
Interest Income on Advances to Affiliates - Related Party | 68,358 | 28,910 |
TOTAL OTHER INCOME | 79,999 | 30,269 |
Interest on Mortgage Notes Payable | 496,515 | 417,543 |
Interest on Notes Payable to Banks | 57,008 | 60,745 |
Interest on Other Notes Payable | 103,287 | 11,504 |
TOTAL INTEREST EXPENSE | 656,810 | 489,792 |
CONSOLIDATED NET LOSS BEFORE INCOME TAX PROVISION, DISCONTINUED OPERATIONS AND GAIN ON DISPOSAL OF ASSETS | (3,691,618) | (2,814,990) |
Income Tax (Provision) Benefit | (341,000) | 227,568 |
CONSOLIDATED NET LOSS FROM CONTINUING OPERATIONS | (4,032,618) | (2,587,422) |
Discontinued Operations, Net of Non-Controlling Interest | (605,360) | (39,332) |
Gain on Disposal of Discontinued Operations | 11,445,879 | |
CONSOLIDATED NET INCOME (LOSS) FROM DISCONTINUED OPERATIONS | 10,840,519 | (39,332) |
CONSOLIDATED NET INCOME (LOSS) | 6,807,901 | (2,626,754) |
LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTEREST | 5,410,300 | (434,782) |
NET INCOME (LOSS) ATTRIBUTABLE TO CONTROLLING INTERESTS | $ 1,397,601 | $ (2,191,972) |
NET LOSS PER SHARE FROM CONTINUING OPERATIONS - BASIC | $ (0.42) | $ (0.27) |
NET INCOME PER SHARE FROM DISCONTINUED OPERATIONS - BASIC | 1.13 | |
NET INCOME (LOSS) PER SHARE TOTAL - BASIC | 0.71 | (0.27) |
NET LOSS PER SHARE FROM CONTINUING OPERATIONS - DILUTED | (0.31) | (0.19) |
NET INCOME PER SHARE FROM DISCONTINUED OPERATIONS - DILUTED | 0.83 | |
NET INCOME (LOSS) PER SHARE PER SHARE TOTAL - DILUTED | $ 0.52 | $ (0.19) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - BASIC | 9,612,139 | 9,682,668 |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - DILUTED | 13,085,223 | 13,366,737 |
Consolidated Statements of Shar
Consolidated Statements of Shareholders' Equity - USD ($) | Shares of Beneficial Interest [Member] | Treasury Stock [Member] | Trust Shareholders' Equity [Member] | Non-Controlling Interest [Member] | Total |
Balance at Jan. 31, 2016 | $ 18,769,849 | $ (12,285,915) | $ 6,483,934 | $ 486,795 | $ 6,970,729 |
Balance, shares at Jan. 31, 2016 | 8,791,500 | 8,615,346 | |||
Net Income Loss | $ (2,191,972) | (2,191,972) | (434,782) | (2,626,754) | |
Dividends | (96,630) | (96,630) | (96,630) | ||
Shares Issued from Cash Received in Prior Period | |||||
Shares Issued from Cash Received in Prior Period, shares | 861,755 | ||||
Purchase of Treasury Stock | $ (77,037) | (77,037) | (77,037) | ||
Purchase of Treasury Stock, shares | (30,227) | 30,227 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 97,265 | 97,265 | 97,265 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | 42,300 | ||||
Sales of Ownership Interests in Subsidiary, net | 55,000 | 55,000 | |||
Distribution to Non-Controlling Interests | (697,324) | (697,324) | |||
Reallocation of Non-Controlling Interests and Other | 215,620 | 215,620 | (215,620) | ||
Balance at Jan. 31, 2017 | $ 16,794,132 | $ (12,362,952) | 4,431,180 | (805,931) | 3,625,249 |
Balance, shares at Jan. 31, 2017 | 9,665,328 | 8,645,573 | |||
Net Income Loss | $ 1,397,601 | 1,397,601 | 5,410,300 | 6,807,901 | |
Dividends | (197,512) | (197,512) | (197,512) | ||
Purchase of Treasury Stock | $ (300,044) | (300,044) | (300,044) | ||
Purchase of Treasury Stock, shares | (150,973) | 150,973 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 86,683 | 86,683 | 86,683 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | 43,250 | ||||
Sales of Ownership Interests in Subsidiary, net | 3,454,226 | 3,454,226 | |||
Distribution to Non-Controlling Interests | (5,757,534) | (5,757,534) | |||
Reallocation of Non-Controlling Interests and Other | 3,853,001 | 3,853,001 | (3,853,001) | ||
Sale of Shares of Beneficial Interest | $ 400,000 | 400,000 | 400,000 | ||
Sale of Shares of Beneficial Interest, shares | 218,064 | ||||
Balance at Jan. 31, 2018 | $ 22,333,905 | $ (12,662,996) | $ 9,670,909 | $ (1,551,940) | $ 8,118,969 |
Balance, shares at Jan. 31, 2018 | 9,775,669 | 8,796,546 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Consolidated Net Income (Loss) | $ 6,807,901 | $ (2,626,754) |
Adjustments to Reconcile Consolidated Net Income (Loss) to Net Cash Used In Operating Activities: | ||
Stock-Based Compensation | 86,683 | 97,265 |
Recovery of Uncollectible Receivables | (25,157) | 19,750 |
Depreciation | 1,469,195 | 2,094,401 |
Goodwill Impairment | 500,000 | |
Amortization of Intangibles | 433,000 | 67,000 |
Amortization of Debt Discounts and Deferred Financing Fees | 75,937 | 29,892 |
Gain on Disposal of Assets | (11,445,879) | |
Changes in Assets and Liabilities: | ||
Accounts Receivable | 399,966 | (475,702) |
Prepaid Expenses and Other Assets | 13,376 | (50,329) |
Accounts Payable and Accrued Expenses | 133,919 | (26,489) |
NET CASH USED IN OPERATING ACTIVITIES | (1,551,059) | (870,966) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Improvements and Additions to Hotel Properties | (2,778,817) | (2,254,499) |
Purchase of Marketable Securities | (1,000,000) | |
Cash Received From Sale of Hotel Property | 9,603,610 | |
Lendings on Advances to Affiliates - Related Party | (1,956,061) | (879,650) |
Collections on Advances to Affiliates - Related Party | 606,541 | 2,231,001 |
NET CASH PROVIDED BY (USED IN) INVESTING ACTIVITIES | 4,475,273 | (903,148) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Principal Payments on Mortgage Notes Payable | (681,868) | (491,806) |
Borrowings on Mortgage Notes Payable | 5,000,000 | |
Payments on Notes Payable to Banks, net of financing costs | (2,428,962) | (1,470,570) |
Borrowings on Notes Payable to Banks, net of financing costs | 1,370,000 | 2,494,051 |
Payments on Line of Credit - Related Party | (775,000) | (61,356) |
Borrowings on Line of Credit - Related Party | 632,384 | 230,000 |
Payments on Notes Payable - Related Party | (2,022,792) | (701,113) |
Borrowings on Notes Payable - Related Party | 2,000,184 | 683,230 |
Payments on Other Notes Payable | (43,195) | (36,622) |
Borrowings on Other Notes Payable | 633,956 | 555,000 |
Payment of Dividends | (197,512) | (96,630) |
Proceeds from Sale of Non-Controlling Ownership Interest in Subsidiary, net | 3,454,226 | 55,000 |
Sale of Shares of Beneficial Interest | 400,000 | |
Distributions to Non-Controlling Interest Holders | (5,757,534) | (697,324) |
Repurchase of Treasury Stock | (300,044) | (77,037) |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 1,283,843 | 384,823 |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS | 4,208,057 | (1,389,291) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 568,396 | 1,957,687 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 4,776,453 | $ 568,396 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 12 Months Ended |
Jan. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations and Basis of Presentation | 1. NATURE OF OPERATIONS AND BASIS OF PRESENTATION As of January 31, 2017, InnSuites Hospitality Trust (the “Trust”, “we”, “us” or “our”) is a publicly traded company with hotels IHT owns, hotels IHT manages, software IHT develops, software IHT sells, and online loyalty reward-based consumer travel services. The Trust and its shareholders owns interests directly in and through a partnership interest, three hotels with an aggregate of 424 suites in Arizona and New Mexico (the “Hotels”) operated under the federally trademarked name “InnSuites Hotels” or “InnSuites”. The Trust and its shareholders owns interests directly in IBC Hospitality Technologies and IVHTravel.com. Hotel Operations: Full service hotels often contain upscale full-service facilities with a large volume of full service accommodations, on-site full-service restaurant(s), and a variety of on-site amenities such as swimming pools, a health club, children’s activities, ballrooms and on-site conference facilities. Moderate or limited service hotels are small to medium-sized hotel establishments that offer a limited amount of on-site amenities. Most moderate or limited service establishments may still offer full service accommodations but lack leisure amenities such as an on-site restaurant or a swimming pool. We consider our Tucson, Arizona hotel and our hotel located in Albuquerque, New Mexico to be moderate or limited service establishments. IHT’s owned properties are limited service hotels. IHT provides management services on a wide variety of hotels. The Trust is the sole general partner of RRF Limited Partnership, a Delaware limited partnership (the “Partnership”), and owned a 74.80% and 72.11% interest in the Partnership as of January 31, 2018 and 2017. The Trust’s weighted average ownership for the years ended January 31, 2018 and 2017 was 72.53% and 72.11%. As of January 31, 2018, the Partnership owned a 51.01% interest in an InnSuites® hotel located in Tucson, Arizona. The Trust owns a direct 12.79% interest in a Yuma, Arizona hotel property, and a direct 22.83% interest in an InnSuites® hotel located in Albuquerque, New Mexico. Under certain management agreements, InnSuites Hotels Inc., our subsidiary, manages the Hotels’ daily operations. The Trust also provides the use of the “InnSuites” trademark to the Hotels through wholly-owned InnSuites Hotels. All such expenses and reimbursements between the Trust, InnSuites Hotels and the Partnership have been eliminated in consolidation. On August 1, 2015, the Trust finalized and committed to a plan to sell all the hotel properties. As of May 1, 2016, the Trust listed all the Hotel properties with a local real estate hotel broker, and management believed that each of the assets was being marketed at a price that was reasonable in relation to its current fair value. The Trust believes that the plan to sell these assets will not be withdrawn. Through the Trust’s Form 10-Q for the quarter ended July 31, 2016 filed with the SEC on December 14, 2016, the Trust classified all the Hotel properties as Assets Held for Sale. As of October 31, 2016, the Trust has decided to reclassify these assets back into operations as many of these assets have been marketed for sale for more than one year. At this time, the Trust is unable to predict when, and if, any of these Hotel properties will be sold. The Trust continues to list these properties with local real estate hotel brokers and believes that each of the assets is being marketed at a price that is reasonable in relation to its current fair value. On June 2, 2017, the Ontario Hospitality Properties LLLP (the “Ontario entity”) was sold to an unrelated third party for $17,500,000 (see Note 24). IBC Hospitality Technologies: InnDependent Boutique Collection (“IBC”, “IBC Hotels”, “IBC Hospitality” or “IBC Hospitality Technologies”), a wholly-owned subsidiary of InnSuites Hospitality Trust, has a network of approximately 2,000 unrelated hospitality properties with proprietary software exclusive marketing distribution and services as well as brand-like cost savings solutions to independent boutique hotels and alternative lodging (serviced apartments, B&B’s, villas and multi-unit ownership/management of luxury private residences). Additionally, IBC provides software and solutions to a variety of branded hotels looking to increase direct bookings and receive full guest information IBC’s patent-pending loyalty program allows consumers to book highly discounted travel when logged in and shopping for lodging on www.ivhtravel.com. IBC was born out of an independent hotelier’s frustration over being denied cost-effective access to enterprise hospitality services and software that served their large corporate competitors coupled with the inability to secure a global and robust guest loyalty program. Instead of giving up independence, the founders of IBC hired a development team to create the patent-pending InnDependent InnCentives guest loyalty program. With the success of the patent-pending InnCentives loyalty program IBC began adding hotel services and software specifically for independent and boutique hotels. These solutions address the following challenges: RevPAR and Profitability Optimization, Operational Management and Soft Brand Benefits. RevPAR, or revenue per available room, is a hospitality performance metric that is calculated by dividing a hotels total guestroom revenue by the room count and the number of days in the period being measured or by multiplying the average daily rate by the occupancy. Our technology division is broken into two business lines, International Vacation Hotels Travel (“IVH”) and IBC Hospitality Technologies. Each of these divisions customer base is very different, and the services provided to each customer base ranges dramatically. Intellectual Property In order to provide our business to business solutions thru IBC and our business to consumer solutions thru IVH, we use software, business processes and proprietary information to carry out our business. These assets including related intellectual property rights, copyrights and website domains are significant assets of our business. InnSuites Hospitality Trust relies on the combination of patent, copyright, trade secret and trademark laws, confidentiality procedures and contractual provisions to protect these assets and we license software and other intellectual property both to and from third parties. Intellectual property assets are considered a valuable part of our business and have become a value-add portion of the services we provide. We consider our intellectual property assets a valuable asset to our business and we renew appropriate registrations and regularly monitor potential infringements of these assets. PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION These consolidated financial statements have been prepared by management in accordance with accounting principles in accordance with GAAP, and include all assets, liabilities, revenues and expenses of the Trust and its wholly-owned subsidiaries. All material intercompany transactions and balances have been eliminated. Certain items have been reclassified to conform to the current fiscal year presentation. The Trust exercises unilateral control over the Partnership and the entities listed below. Therefore, the financial statements of the Partnership and the entities listed below are consolidated with the Trust, and all significant intercompany transactions and balances have been eliminated. IHT OWNERSHIP % ENTITY DIRECT INDIRECT (i) Albuquerque Suite Hospitality, LLC (see Note 6) 22.83 % - Tucson Hospitality Properties, LLLP - 51.01 % Ontario Hospitality Properties, LLLP (sold in June, 2017) 99.60 % - Yuma Hospitality Properties, LLLP (see Note 6) 12.79 % - Tucson Saint Mary’s Hospitality LLC - 83.66 % RRF Limited Partnership 74.80 % - InnSuites Hotels Inc. 100.00 % - IBC Hotels, LLC (including dba International Vacation Hotels) 99.90 % 0.10 % (i) Indirect ownership is through the Partnership PARTNERSHIP AGREEMENT The Partnership Agreement of the Partnership provides for the issuance of two classes of Limited Partnership units, Class A and Class B. Class A and Class B Partnership units are identical in all respects, except that each Class A Partnership unit is convertible into one newly-issued Share of Beneficial Interest of the Trust at any time at the option of the particular limited partner. The Class B Partnership units may only become convertible, each into one newly-issued Share of Beneficial Interest of the Trust, with the approval of the Board of Trustees, in its sole discretion. On January 31, 2018 and 2017, 250,093 and 276,131 Class A Partnership units were issued and outstanding, representing 1.95% and 2.09% of the total Partnership units, respectively. Additionally, as of both January 31, 2018 and 2017, 2,974,038 and 3,407,938 Class B Partnership units were outstanding to James Wirth, the Trust’s Chairman and Chief Executive Officer, and Mr. Wirth’s affiliates. If all of the Class A and B Partnership units were converted on January 31, 2018, the limited partners in the Partnership would receive 3,314,131 and 3,684,069 Shares of Beneficial Interest of the Trust. As of January 31, 2018, and 2017, the Trust owns 9,527,448 general partner units in the Partnership, representing 74.80% and 72.11% of the total Partnership units, respectively. LIQUIDITY Our principal source of cash to meet our cash requirements, including distributions to our shareholders, is our share of the Partnership’s cash flow, quarterly distributions from the Albuquerque, New Mexico and Yuma, Arizona properties and more recently, sales of non-controlling interests in certain of our Hotels. The Partnership’s principal source of cash flow is quarterly distributions from the Tucson, Arizona properties. Our liquidity, including our ability to make distributions to our shareholders, will depend upon our ability and the Partnership’s ability to generate sufficient cash flow from hotel operations and to service our debt. As of January 31, 2018, the Trust had a related party Demand/Revolving Line of Credit/Promissory Note with an amount receivable of approximately $811,000. The Demand/Revolving Line of Credit/Promissory Note accrues interest at 7.0% per annum and requires interest only payments. The Demand/Revolving Line of Credit/Promissory Note has a maximum borrowing capacity to $1,000,000, which is available through December 31, 2018. As of April 18, 2018, the outstanding net balance receivable on the Demand/Revolving Line of Credit/Promissory Note was $811,000. As of January 31, 2018, the Trust had an Advance to Affiliate credit facilities with an aggregate maximum borrowing capacity of $1,000,000, which is available through June 30, 2018. As of January 31, 2018, the Trust had an amount receivable of the Advances to Affiliate credit facility of approximately $971,000. As of April 18, 2018, the amount receivable from the Advance to Affiliate credit facility was approximately $830,000. With approximately $5,775,000 of cash and short term investments, as of January 31, 2018, the availability of a $1,000,000 related party Demand/Revolving Line of Credit/Promissory Note, and the availability of the combined $1,000,000 Advance to Affiliate credit facilities, we believe that we will have enough cash on hand to meet all of our financial obligations as they become due for at least the next year. In addition, our management is analyzing other strategic options available to us, including the refinancing of another property or raising additional funds through additional non-controlling interest sales; however, such transactions may not be available on terms that are favorable to us, or at all There can be no assurance that we will be successful in obtaining extensions, refinancing debt or raising additional or replacement funds, or that these funds may be available on terms that are favorable to us. If we are unable to raise additional or replacement funds, we may be required to sell certain of our assets to meet our liquidity needs, which may not be on terms that are favorable. SEASONALITY OF THE HOTEL BUSINESS The Hotels’ operations historically have been somewhat seasonal. The two southern Arizona hotels experience their highest occupancy in the first fiscal quarter and, to a lesser extent, the fourth fiscal quarter. The second fiscal quarter tends to be the lowest occupancy period at those two southern Arizona hotels. This seasonality pattern can be expected to cause fluctuations in the Trust’s quarterly revenues. The hotel located in New Mexico historically experience their most profitable periods during the second and third fiscal quarters (the summer season), providing some balance to the general seasonality of the Trust’s hotel business. The seasonal nature of the Trust’s business increases its vulnerability to risks such as labor force shortages and cash flow issues. Further, if an adverse event such as an actual or threatened terrorist attack, international conflict, data breach, regional economic downturn or poor weather conditions should occur during the first or fourth fiscal quarters, the adverse impact to the Trust’s revenues could likely be greater as a result of its southern Arizona seasonal business. RECENTLY ISSUED ACCOUNTING GUIDANCE In August 2014, FASB issued Accounting Standards Update (“ASU”) No. 2014-15, “Presentation of Financial Statements – Going Concern (Subtopic 205-40): Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern” (“ASU 2014-15”). Under GAAP, continuation of a reporting entity as a going concern is presumed as the basis for preparing financial statements unless and until the entity’s liquidation becomes imminent. Preparation of financial statements under this presumption is commonly referred to as the going concern basis of accounting. If and when an entity’s liquidation becomes imminent, financial statements should be prepared under the Liquidation Basis of Accounting. Even if an entity’s liquidation is not imminent, there may be conditions or events that raise substantial doubt about the entity’s ability to continue as a going concern. In those situations, financial statements should continue to be prepared under the going concern basis of accounting, but the amendments in ASU 2014-15 require additional disclosure of information about the relevant conditions and events. The amendments in ASU 2014-15 are effective for annual periods ending after December 15, 2016, and for annual periods and interim periods thereafter. Early application is permitted. The Trust has adopted this guidance on its consolidated financial statements and we believe no material impact exists at this time. In March 2016, the FASB issued ASU No. 2016-09, “Compensation – Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting,” a new standard which simplifies the accounting for share-based payment transactions. This guidance requires that excess tax benefits and tax deficiencies be recognized as income tax expense or benefit in the Consolidated Statements of Operations rather than additional paid-in capital. Additionally, the excess tax benefits will be classified along with other income tax cash flows as an operating activity, rather than a financing activity, on the Statement of Cash Flows. Further, the update allows an entity to make a policy election to recognize forfeitures as they occur or estimate the number of awards expected to be forfeited. It will be effective for us beginning in February 2018 and should be applied prospectively, with certain cumulative effect adjustments. Early adoption is permitted. We are currently assessing the impact that this standard will have on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842).” This new standard establishes a right-of-use (“ROU”) model that requires a lessee to record a ROU asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition in the income statement. ASU 2016-02 is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. A modified retrospective transition approach is required for lessees for capital and operating leases existing at, or entered into after, the beginning of the earliest comparative period presented in the financial statements, with certain practical expedients available. The Trust is currently evaluating the impact of the adoption of ASU 2016-02 on the Trust’s consolidated financial statements. The FASB issued the following accounting standard updates related to Topic 606, Revenue Contracts with Customers: ● In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Updates (“ASU”) No. 2014-09. “Revenue from Contracts with Customers.” This new standard will replace the existing revenue recognition guidance in GAAP. The core principle of the ASU is the recognition of revenue for the transfer of goods and services equal to the amount an entity expects to receive for those goods and services. This ASU requires additional disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and estimates and changes in those estimates. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contacts with Customers: Deferral of the Effective Date” that delayed the effective date of ASU 2014-09 by one year to February 1, 2018, as the Trust’s annual reporting period is after December 15, 2017. The Trust has continued to analyze the impact of the new standard on its financial results based on an inventory of the Trust’s current contacts with customers. The Trust has obtained an understanding of the new standard and believes starting February 1, 2018, the Trust will change its accounting policy to record prepaid reservations on a net basis. Upon adoption of the new standard, the Trust anticipates there will be no effect on retained earnings. Starting August 1, 2017, we changed our accounting policy to record prepaid reservations on a “gross basis” which included recording an additional amount of reservation revenues equal to an additional amount of reservation acquisition expenses representing the entire amount of the guest prepaid reservation, excluding taxes and including IBC Hotels’ commission. Reservation acquisition costs included amounts owed to hotels for prepaid reservations from August 2017 – January 2018 were approximately $234,000. Previous to August 1, 2017, all prepaid reservations were recorded on a “net basis” and only the prepaid reservation commissions were included in revenues. Therefore there was no effect on retained earnings during the fiscal year ending January 31, 2018. The Trust continues to evaluate the impact of ASU No. 2014-09 on our financial results and prepare for the adoption of the standard on February 1, 2018, including readying its internal processes and control environment for new requirements, particularly around enhanced disclosures, under the new standard. The standard allows for both retrospective and modified retrospective methods of adoption. The Trust is in the process of determining the method of adoption it will elect and the impact on our consolidated financial statements and footnote disclosures and will provide enhanced disclosures as we continue our assessment. ● ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606)” (“ASU 2014-09”) in May 2014. ASU 2014-09 requires entities to recognize revenue through the application of a five-step model, which includes identification of the contract, identification of the performance obligations, determination of the transaction price, allocation of the transaction price to the performance obligations and recognition of revenue as the entity satisfies the performance obligations. ● ASU No. 2016-08, “Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net)” (“ASU 2016-08”) in March 2016. ASU 2016-08 does change the core principle of revenue recognition in Topic 606 but clarifies the implementation guidance on principal versus agent considerations. The Trust has continued to analyze the impact of the new standard on its financial results based on an inventory of the Trust’s current contacts with customers. The Trust has obtained an understanding of the new standard and believes starting February 1, 2018, the Trust will change its accounting policy to record prepaid reservations on a net basis. ● ASU No. 2016-10, “Revenue from Contracts with Customers (Topic 606): Identifying Performance Obligations and Licensing” (“ASU 2016-10”) in April 2016. ASU 2016-10 does not change the core principle of revenue recognition in Topic 606 but clarifies the implementation guidance on identifying performance obligations and the licensing implementation guidance, while retaining the related principles for those areas. ● ASU No. 2016-11, “Revenue Recognition (Topic 605) and Derivatives and Hedging (Topic 815): Rescission of SEC Guidance Because of Accounting Standards Updates 2014-09 and 2014-16 Pursuant to Staff Announcements at the March 3, 2016 EITF Meeting (SEC Update)” (“ASU 2016-11”) in May 2016. ASU 2016-11 rescinds SEC paragraphs pursuant to two SEC Staff Announcements at the March 3, 2016 EITF meeting. The SEC Staff is rescinding SEC Staff Observer comments that are codified in Topic 605 and Topic 932, effective upon adoption of Topic 606. ● ASU No. 2016-12, “Revenue from Contracts with Customers (Topic 606): Narrow-Scope Improvements and Practical Expedients” (“ASU 2016-12”) in May 2016. ASU 2016-12 does not change the core principle of revenue recognition in Topic 606 but clarifies the implementation guidance on a few narrow areas and adds some practical expedients to the guidance. ● ASU No. 2017-04, “Intangibles – Goodwill and Other (Topic 350): Simplifying the Test for Goodwill Impairment” (“ASU 2017-04”) in January 2017. ASU 2017-04 does not change the core principle of revenue recognition in Topic 606 but clarifies the implementation guidance on a few narrow areas and adds some practical expedients to the guidance. ASU 2017-04 allows companies to measure goodwill impairment as the excess of the reporting unit’s carrying value over its fair value. ASU 2017-04 is effective for public companies that file with the SEC for annual or any interim goodwill impairment tests in fiscal years beginning after December 15, 2019. The Trust is in the process of determining the impact on our consolidated financial statements and footnote disclosures, and will provide enhanced disclosures as we continue our assessment. These ASUs will become effective for the Trust beginning interim period February 1, 2018. Based on our initial evaluation of the new revenue recognition standards, the Trust believes that all of our revenues will need to be presented on a net basis instead of a gross basis as currently presented. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Jan. 31, 2018 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | 2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES USE OF ESTIMATES The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Trust’s operations are affected by numerous factors, including the economy, competition in the hotel industry and the effect of the economy on the travel and hospitality industries. The Trust cannot predict if any of the above items will have a significant impact in the future, nor can it predict what impact, if any, the occurrence of these or other events might have on the Trust’s operations and cash flows. Significant estimates and assumptions made by management include, but are not limited to, the estimated useful lives of long-lived assets and recoverability of long-lived assets and the fair values of the long-lived assets. PROPERTY, PLANT AND EQUIPMENT AND HOTEL PROPERTIES Furniture, fixtures, building improvements and hotel properties are stated at cost and are depreciated using the straight-line method over estimated lives ranging up to 40 years for buildings and 3 to 10 years for furniture and equipment. Management applies guidance ASC 360-10-35, to determine when it is required to test an asset for recoverability of its carrying value and whether an impairment exists. Under ASC 360-10-35, the Trust is required to test a long-lived asset for impairment when there is an indicator of impairment. Impairment indicators may include, but are not limited to, a drop in the performance of a long-lived asset, a decline in the hospitality industry or a decline in the economy. If an indicator of potential impairment is present, then an assessment is performed of whether the carrying amount of an asset exceeds its estimated undiscounted future cash flows over its estimated remaining life. If the estimated undiscounted future cash flows over the asset’s estimated remaining life are greater than the asset’s carrying value, no impairment is recognized; however, if the carrying value of the asset exceeds the estimated undiscounted future cash flows, then the Trust would recognize an impairment expense to the extent the asset’s carrying value exceeds its fair value, if any. The estimated future cash flows are based upon, among other things, assumptions about expected future operating performance, and may differ from actual cash flows. Long-lived assets evaluated for impairment are analyzed on a property-specific basis independent of the cash flows of other groups of assets. Evaluation of future cash flows is based on historical experience and other factors, including certain economic conditions and committed future bookings. Management has determined that impairment of long-lived assets existed during the Trust’s fiscal years ended January 31, 2018 and 2017 (see Note 9). Management applies guidance ASC 350-40 Intangibles – Computer Software Developed or Obtained for Internal Use, to determine whether it should capitalize internal use software developed for our IBC Technologies division. Under ASC 350-40, Management determined that some of the internal-use software can possible be capitalized during the application development stage of development. The application development stage of development includes software configuration, software interfaces and coding. Management has capitalized internally developed software that meets the application development stage of development. Internally developed software is capitalized over the estimated useful life, which ranges from 3-5 years. INTANGIBLE ASSETS Intangible assets with finite lives were amortized on a straight-line basis over the estimated useful lives, which ranged from 7 to 10 years. The useful life of the intangible asset was evaluated each reporting period to determine whether events and circumstances warrant a revision to the remaining useful life (see Note 9). BUSINESS COMBINATIONS We account for business combinations by recognizing the assets acquired, liabilities assumed, contractual contingencies, and contingent consideration at their fair values on the acquisition date. The final purchase price may be adjusted up to one year from the date of the acquisition. Identifying the fair value of the tangible and intangible assets and liabilities requires the use of estimates by management and was based upon currently available data. The Trust allocates the excess of purchase price over the identifiable intangible and net tangible assets to goodwill. Such goodwill is not deductible for tax purposes and represents the value placed on entering new markets and expanding market share (see Note 9). Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates or actual results. Additionally, any change in the fair value of the acquisition-related contingent consideration subsequent to the acquisition date, included changes from events after the acquisition date, such as changes in our estimate of relevant revenue or other targets, will be recognized in earnings in the period of the estimated fair value change. A change in fair value of the acquisition-related contingent consideration or the occurrence of events that cause results to differ from our estimates or assumptions could have a material effect on the consolidated statements of operations, financial position and cash flows in the period of the change in the estimate. GOODWILL The Trust tests goodwill for impairment annually, or whenever events or changes in circumstances indicate an impairment may have occurred, by comparing its reporting unit’s carrying value to its implied fair value. Impairment may result from, among other things, deterioration in the performance of the acquired business, adverse market conditions, adverse changes in applicable laws or regulations and a variety of other circumstances. If the Trust determines that an impairment has occurred, it is required to record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made. In evaluating the recoverability of the carrying value of goodwill, the Trust must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the acquired assets. Changes in strategy or market conditions could significantly impact those judgements in the future and require an adjustment to the recorded balances. The goodwill was recorded as part of the acquisition of International Vacation Hotels that occurred on January 8, 2016 (see Note 9) and an impairment existed as of January 31, 2018. CASH AND CASH EQUIVALENTS The Trust considers all highly liquid short-term investments with maturities of three months or less at the time of purchase to be cash equivalents. The Trust believes it places its cash and cash equivalents only with high credit quality financial institutions, although these balances may periodically exceed federally insured limits. REVENUE RECOGNITION Hotel and Operations Staff Accounting Bulletin (“SAB”) No. 104, “Revenue Recognition” summarizes the SEC’s views in applying generally accepted accounting principles to revenue recognition in financial statements. SAB No. 104 establishes the SEC’s view that it is not appropriate to recognize revenue until all of the following criteria are met: persuasive evidence that an arrangement exists; delivery has occurred or services have been rendered; the seller’s price to the buyer is fixed or determinable; and collectability is reasonably assured. Further, SAB No. 104 requires that both title and the risks and rewards of ownership be transferred to the buyer before revenue can be recognized. We believe that our revenue recognition policies as described below are in compliance with SAB No. 104. Revenues are primarily derived from the following sources and are recognized as services are rendered and when collectability is reasonably assured. Amounts received in advance of revenue recognition are considered deferred liabilities. Revenues primarily consist of room rentals, food and beverage sales, management and trademark fees and other miscellaneous revenues from our properties. Revenues are recorded when rooms are occupied and when food and beverage sales are delivered. Management and trademark fees from non-affiliated hotels include a monthly accounting fee and a percentage of hotel room revenues for managing the daily operations of the Hotels and the one hotel owned by affiliates of Mr. Wirth. We are required to collect certain taxes and fees from customers on behalf of government agencies and remit these back to the applicable governmental agencies on a periodic basis. We have a legal obligation to act as a collection agent. We do not retain these taxes and fees and, therefore, they are not included in revenues. We record a liability when the amounts are collected and relieve the liability when payments are made to the applicable taxing authority or other appropriate governmental agency. IBC Technologies Division Our operating results are affected by certain metrics, such as bookings and revenue margin, which we believe are necessary for understanding and evaluating us. Gross bookings represent the total retail value of transactions booked for both agency and merchant transactions, recorded at the time of booking reflecting the total price due for travel by travelers, including taxes, fees and other charges. As travelers have increased their use of the internet to book travel arrangements, we have generally seen our gross bookings increase, reflecting the growth in the online travel industry, our organic market share gains and our business acquisitions. We also evaluate the presentation of revenue on a gross versus a net basis. The consensus of the authoritative accounting literature is that the presentation of revenue as “the gross amount billed to a customer because it has earned revenue from the sale of goods or services or the net amount retained (that is, the amount billed to a customer less the amount paid to a supplier) because it has earned a commission or fee” is a matter of judgment that depends on the relevant facts and circumstances. In making an evaluation of this issue, some of the factors that should be considered are: whether we are the primary obligor in the arrangement (strong indicator); whether we have general supply risk (before customer order is placed or upon customer return) (strong indicator); and whether we have latitude in establishing price. The guidance clearly indicates that the evaluation of these factors, which at times can be contradictory, are subject to significant judgment and subjectivity. If the conclusion drawn is that we perform as an agent or a broker without assuming the risks and rewards of ownership of goods, revenue should be reported on a net basis. For our revenue models, discussed below, we have determined gross presentation is appropriate for certain of revenue transactions and net for others. Based on our initial evaluation of the new revenue recognition standards effective for filing periods after February 1, 2018, the Trust believes that all of our IBC revenues will be presented on a net basis. IVH - Business to Consumer IVH (Business to Consumer) and IBC (Business to Business) are two very different businesses that have two very different customer bases and provide very different services. IVH’s (Business to Consumer) customer is the guest who is staying at the hotel property. Their customer isn’t the hotel that the guest is staying at. The consumer gets to select which hotel and which room type. In some cases IVH prepays for discounted inventory from suppliers and resells it to guests so IVH is holding the supply. IVH plans on potentially doing more of this type of business based on the economics. We provide significant value to the guest by providing a 24/7/365 reservation hotline, travel insurance and support up until the guest reaches the hotel property. We are paid in a variety of ways, sometimes the full value of the reservation is paid to us, of which we remit the hotels portion, sometime just our reservation fee which is equal to a non-refundable deposit made by the guest and sometime by billing the hotel for our reservation fee. Regardless of payment method and mostly depending upon the contractual obligations between IVH and the hotel, IVH typically is forced to pay for no-show reservations. IBC – Business to Business IBC is a leading technology solutions provider to the global travel and tourism industry. IBC’s customer base is the hospitality properties, not the guests who are staying at the properties. The written agreements IBC has is directly with the properties. IBC has significant information risks per their contractual obligations with the hotels. Services include a CRS, Digital Marketing Services, Meta Services, Patent-pending loyalty services, websites and proprietary booking engines. IBC is the primary obligor in the arrangement to provide these services. The hotels look to IBC to fulfill the contractual obligations of the arrangement. IBC is required to pay all upfront costs, regardless of usage and therefore has general inventory risk. IBC sets the price of its contracts and has the latitude to sell our services at various prices to our hotels. IBC changes the product before our network of hotels receive it as we have an entire onboarding team dedicated to ensure the content is uploaded properly, we have a call center and we provide the technology updates as necessary. IBC has sole discretion in selecting our suppliers and the product and service has been designed by IBC. In addition, IBC owns the software that the hotels license the rights to we invoice all of our hotels on monthly basis and records the gross amount of our services as revenues. IBC derives substantially all of our digital marketing revenues from the performance of professional services on a fixed price monthly basis. Our digital marketing services include, but are not limited to, metasearch, retargeting, website design, reputation management, various online business listing services, social media marketing and rate shopping services. We recognize revenues as professional services are performed. A significant component of our digital marketing is search engine marketing (“SEM”). With SEM, we receive a commission on top of the amount of advertising we place for our clients. We incur digital advertising costs on behalf of our clients which are reflected in our advertising and marketing expenses. These expenses include media and production services to place advertisements strategically on various websites to maximize obtaining additional reservations for the hotel. Based on our policy, we recognize revenue when we believe that persuasive evidence of an arrangement exists, delivery has occurred, or services have been rendered, the seller’s price to the buyer is fixed or determinable, and the collectability of our revenues are reasonably assured. ACCOUNTS RECEIVABLES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Accounts receivable are carried at original amounts billed less an estimate made for doubtful accounts based on a review of outstanding amounts on a quarterly basis. Management generally records an allowance for doubtful accounts for 50% of balances over 90 days and 100% of balances over 120 days. Accounts receivable are written off when collection efforts have been exhausted and they are deemed uncollectible. Recoveries, if any, of receivables previously written off are recorded when received. The Trust does not charge interest on accounts receivable balances and these receivables are unsecured. The following is a reconciliation of the allowance for doubtful accounts for the fiscal years ending January 31, 2018 and 2017. Fiscal Year Balance at the Beginning of Year Discontinued Operations Adjustment Charged to Expense Deductions Balance at the End of Year 2018 $ 53,720 $ (19,750 ) $ 11,356 $ (73,890 ) $ (28,564 ) 2017 $ 33,970 $ - $ 127,114 $ (107,364 ) $ 53,720 STOCK-BASED COMPENSATION We have an employee equity incentive plan, which is described more fully in Note 22 - “Share-Based Payments.” For fiscal year 2018 and 2017, the Trust has paid the annual fees due to its Trustees by issuing Shares of Beneficial Interest out of its authorized but unissued Shares of Beneficial Interest. Upon issuance, the Trust recognizes the shares as outstanding. The Trust recognizes expense related to the issuance based on the fair value of the shares upon the date of the restricted share grant and amortizes the expense equally over the period during which the shares vest to the Trustees. During fiscal year 2018, the Trust granted restricted stock awards of 24,000 Shares to members of the Board of Trustees, all of which vested in fiscal year 2018 resulting in stock-based compensation of $51,840. During fiscal year 2017, the Trust granted restricted stock awards of 24,000 Shares to members of the Board of Trustees, all of which vested in fiscal year 2017 resulting in stock-based compensation of $55,920. The following table summarizes restricted share activity during fiscal years 2018 and 2017. Restricted Shares Shares Weighted-Average Per Share Grant Date Fair Value Balance at January 31, 2016 - - Granted 24,000 $ 2.16 Vested (24,000 ) $ 2.16 Forfeited - - Balance of unvested awards at January 31, 2017 - - Granted 24,000 $ 2.16 Vested (24,000 ) $ 2.16 Forfeited - - Balance of unvested awards at January 31, 2018 - - TREASURY STOCK Treasury stock is carried at cost, including any brokerage commissions paid to repurchase the shares. Any shares issued from treasury stock are removed at cost, with the difference between cost and fair value at the time of issuance recorded against Shares of Beneficial Interest. INCOME TAXES The Trust is subject to federal and state corporate income taxes, and accounts for deferred taxes utilizing an asset and liability method whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when it is determined to be more likely than not that some portion, or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment (see Note 17). DIVIDENDS AND DISTRIBUTIONS In fiscal year 2017, the Trust paid a dividend of $0.01 per share in the fourth quarter for $96,630. In fiscal year 2018, the Trust paid a dividend of $0.01 per share at end of the second fiscal quarter and at the end of the fourth fiscal quarter for a total dividend of $0.02 for the fiscal year for $197,512. The Trust’s ability to pay dividends is largely dependent upon the operations of the Hotels. NON-CONTROLLING INTEREST Non-controlling interest in the Trust represents the limited partners’ proportionate share of the capital and earnings of the Partnership. Income or loss is allocated to the non-controlling interest based on a weighted average ownership percentage in the entities throughout the period, and capital is allocated based on the ownership percentage at year-end. Any difference between the weighted average and point-in-time allocations is presented as a reallocation of non-controlling interest as a component of shareholders’ equity. INCOME (LOSS) PER SHARE Basic and diluted income (loss) per Share of Beneficial Interest is computed based on the weighted-average number of Shares of Beneficial Interest and potentially dilutive securities outstanding during the period. Dilutive securities are limited to the Class A and Class B units of the Partnership, which are convertible into 3,314,131Shares of the Beneficial Interest, as discussed in Note 1. For the fiscal years ended January 31, 2018 and 2017, there were Class A and Class B Partnership units outstanding, which are convertible into Shares of Beneficial Interest of the Trust. Assuming conversion at the beginning of each period, the aggregate weighted-average of these Shares of Beneficial Interest would have been 3,473,085 in addition to the basic shares outstanding for fiscal years 2018 and 2017, respectively. These Shares of Beneficial Interest issuable upon conversion of the Class A and Class B Partnership units were dilutive during fiscal 2017 and are included in the calculation of diluted earnings per share for that year below. For the Year Ended January 31, 2018 Net Income attributable to controlling interest $ 1,397,601 Plus: Net Income attributable to non-controlling interests 5,410,300 Net Income $ 6,807,901 Weighted average common shares outstanding 9,612,139 Plus: Weighted average incremental shares resulting from unit conversion 3,473,085 Weighted average common shares outstanding after unit conversion 13,085,223 Diluted Income Per Share $ 0.52 SEGMENT REPORTING The Trust determined that its operations are comprised of two reportable segments, a Hotel Operations & Corporate Overhead segment that has ownership interest in three hotel properties with an aggregate of 424 suites in Arizona and New Mexico, and the IBC Hospitality segment serving 2,000 unrelated hotel properties. The Trust has a concentration of assets in the southwest United States and the southern Arizona market. Historical financial information presented in this Form 10-K reflects this change. On an overall basis, the Trust has elected to only put the costs directly attributable to the IBC Hospitality segment in that segment. Included in these costs are salaries, employee taxes and benefits, sales, marketing and technology development costs. IBC Hotels, LLC was formed during the fiscal year ended January 31, 2014. IBC Hotels, LLC charges a 10% - 20% booking fee which, we believe, increases the independent hotel net profits through lower guest acquisition costs and full guest information for lower lifetime average acquisition cost. Competitors of IBC Hotels can charge anywhere from a 15% to 50% booking fee. InnDependent InnCentives, IBC’s loyalty program, allows hoteliers to benefit from guests who frequently stay at IBC independent hotels. We are actively looking for investors to purchase all or part of IBC Hotels and we are looking to continue to expand IBC Hotels in the future as we concentrate our sales and marketing efforts towards consumers, but can provide no assurance that we will be successful. The Chief Operating Decision Maker (“CODM”), the Trust’s CEO, Mr. Wirth, does not see value in allocating costs for items not directly attributable to the IBC Hospitality segment for several reasons. The first is that the Trust’s base business is the Hotel Operations & Corporate Overhead segment, and the majority of the expenses of the Trust would continue even if the Trust was not in the reservation business. If the Trust were to allocate general expenses to the reservation business based on some allocation method (e.g., on sales), it would not improve the value of segment reporting, but it would only serve to make the results of the Hotel Operations & Corporate Overhead segment look better and give investors an unfounded sense of the profitability of the Hotel Operations & Corporate Overhead segment without the IBC Hospitality segment. The CODM wants to understand the true investment in the reservation business and that result is delivered by allocating only costs directly associated with the IBC Hospitality segment. By retaining the remainder of costs not associated with the IBC Hospitality segment in the Hotel Operations & Corporate Overhead segment, the Trust is able to compare the Hotel Operations & Corporate Overhead segment to historical figures where the bulk of the business was only that segment of operations to gauge relative efficiency of the Hotel Operations & Corporate Overhead segment as compared to historical norms. The Trust has chosen to focus its hotel investments in the southwest region of the United States. The CODM does not review assets by geographical region; therefore, no income statement or balance sheet information by geographical region is provided. ADVERTISING COSTS Amounts incurred for advertising costs are expensed as incurred. Advertising expense totaled approximately $368,000 and $567,000 for the years ended January 31, 2018 and 2017, respectively. CONCENTRATION OF CREDIT RISK Credit risk is the risk of an unexpected loss if a third party to a financial instrument fails to meet its contractual obligations. Financial instruments that potentially subject the Trust to a concentration of credit risk consist primarily of cash and cash equivalents. Management’s assessment of the Trust’s credit risk for cash and cash equivalents is low as cash and cash equivalents are held in financial institutions believed to be credit worthy. The Trust limits its exposure to credit loss by placing its cash with major financial institutions and invests only in short-term obligations. While the Trust is exposed to credit losses due to the non-performance of its counterparties, the Trust considers the risk of this remote. The Trust estimates its maximum credit risk for accounts receivable at the amount recorded on the balance sheet. FAIR VALUE OF FINANCIAL INSTRUMENTS For disclosure purposes, fair value is determined by using available market information and appropriate valuation methodologies. Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability. The fair value framework specifies a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The fair value hierarchy levels are as follows: ● Level 1 – Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. ● Level 2 – Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and / or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are level 2 valuation techniques. ● Level 3 – Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect a company’s own judgments about the assumptions that market participants would use in pricing an asset or liability. The Trust has no assets or liabilities that are carried at fair value on a recurring basis and had no fair value re-measurements during the years ended January 31, 2018 and 2017. Due to their short maturities, the carrying value of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value. The fair value of mortgage notes payable, notes payable to banks and notes and advances payable to related parties is estimated by using the current rates which would be available for similar loans having the same remaining maturities and are based on level 3 inputs. |
Sale of Ownership Interests in
Sale of Ownership Interests in Albuquerque Subsidiary | 12 Months Ended |
Jan. 31, 2018 | |
Sale Of Ownership Interests In Albuquerque Subsidiary | |
Sale of Ownership Interests in Albuquerque Subsidiary | 3. SALE OF OWNERSHIP INTERESTS IN ALBUQUERQUE SUBSIDIARY On July 22, 2010, the Board of Trustees unanimously approved, with Mr. Wirth abstaining, for the Partnership to enter into an agreement with Rare Earth Financial, LLC (“Rare Earth”), an affiliate of Mr. Wirth, to sell units in Albuquerque Suite Hospitality, LLC (the “Albuquerque entity”), which owns and operates the Albuquerque, New Mexico hotel property. Under the agreement, Rare Earth agreed to either purchase or bring in other investors to purchase at least 49% of the membership interests in the Albuquerque entity and the parties agreed to restructure the operating agreement of the Albuquerque entity. A total of 400 units were available for sale for $10,000 per unit, with a two-unit minimum subscription. On September 24, 2010, the parties revised the Amended and Restated Operating Agreement to name Rare Earth as the administrative member of the Albuquerque entity in charge of the day-to-day management. On December 9, 2013, the Trust entered into an updated restructuring agreement with Rare Earth to allow for the sale of additional interest units in the Albuquerque entity for $10,000 per unit. Under the updated restructuring agreement, Rare Earth agreed to either purchase or bring in other investors to purchase up to 150 (and potentially up to 190 if the overallotment is exercised) units. Under the terms of the updated restructuring agreement, the Trust agreed to hold at least 50.1% of the outstanding units in the Albuquerque entity, on a post-transaction basis, and intends to maintain this minimum ownership percentage through the purchase of units under this offering. The Board of Trustees approved this restructuring on December 9, 2013. The units in the Albuquerque entity are allocated to three classes with differing cumulative discretionary priority distribution rights through December 31, 2015. Class A units are owned by unrelated third parties and have first priority for distributions. Class B units are owned by the Trust and have second priority for distributions. Class C units are owned by Rare Earth or other affiliates of Mr. Wirth and have the lowest priority for distributions from the Albuquerque entity. Priority distributions of $700 per unit per year were cumulative until December 31, 2015; however, after December 31, 2015 Class A unit holders continue to hold a preference on distributions over Class B and Class C unit holders. If certain triggering events related to the Albuquerque entity occur prior to the payment of all accumulated distributions to its members, such accumulated distributions will be paid out of any proceeds of the event before general distribution of the proceeds to the members. In the event that funds generated from a triggering event are insufficient to pay the total amount of all such accumulated distributions owed to the members, all Class A members will participate pro rata in the funds available for distribution to them until paid in full, then Class B, and then Class C. After all investors have received their initial capital plus a 7% per annum simple return, any additional profits will be allocated 50% to Rare Earth, with the remaining 50% allocated proportionately to all unit classes. Rare Earth received a restructuring fee of $128,000, conditioned upon and arising from the sale of the first 100 units in the Albuquerque entity following the December 31, 2013 restructuring. The Albuquerque entity plans to use its best efforts to pay the discretionary priority distributions. The Trust does not guarantee and is not otherwise obligated to pay the cumulative discretionary priority distributions. InnSuites Hotels will continue to provide management, licensing and reservation services to the Albuquerque, New Mexico property. On February 15, 2017, the Trust and Partnership entered into a restructuring agreement with Rare Earth to allow for the sale of non-controlling partnership units in the Albuquerque entity for $10,000 per unit. Rare Earth and the Trust have restructured the Albuquerque Entity Membership Interest by creating 250 additional Class A membership interests from General Member majority-owned to accredited investor member-owned. In the event of sale of 250 Class A Interests, total interests outstanding will change from 550 to 600 with Class A, Class B and Class C Limited Liability Company Interests (referred to collectively as “Interests”) restructured with IHT selling approximately 200 Class B Interests to accredited investors as Class A Interest. Rare Earth, as a General Partner of the Albuquerque entity, will coordinate the offering and sale of Class A Interests to qualified third parties. Rare Earth and other Rare Earth affiliates may purchase Interests under the offering. As part of this offering, Rare Earth was paid $200,000 for a restructuring fee which was recorded in Equity. During the fiscal year ended January 31, 2018, there were 193 Class A units of the Albuquerque entity sold, of which 142 came from the Trust at $10,000 per unit. As of January 31, 2018, the Trust held a 22.83% ownership interest, or 137 Class B units, in the Albuquerque entity, Mr. Wirth and his affiliates held a 0.17% interest, or 1 Class C unit, and other parties held a 77.00% interest, or 462 Class A units. During the fiscal year ended January 31, 2018, the Albuquerque entity has made discretionary Priority Return payments to unrelated unit holders of approximately $209,000, and to the Trust of approximately $177,000. As of February 1, 2017, the Trust no longer accrues for these distributions as the preference period has expired. |
Sale of Ownership Interests i10
Sale of Ownership Interests in Tucson Hospitality Properties Subsidiary | 12 Months Ended |
Jan. 31, 2018 | |
Sale Of Ownership Interests In Tucson Hospitality Properties Subsidiary | |
Sale of Ownership Interests in Tucson Hospitality Properties Subsidiary | 4. SALE OF OWNERSHIP INTERESTS IN TUCSON HOSPITALITY PROPERTIES SUBSIDIARY On February 17, 2011, the Partnership entered into a restructuring agreement with Rare Earth to allow for the sale of non-controlling interest units in Tucson Hospitality Properties, LP (the “Tucson entity”), which operates the Tucson Oracle hotel property, then wholly-owned by the Partnership. Under the agreement, Rare Earth agreed to either purchase or bring in other investors to purchase up to 250 units, which represents approximately 41% of the outstanding limited partnership units in the Tucson entity, on a post-transaction basis, and the parties agreed to restructure the limited partnership agreement of the Tucson entity. The Board of Trustees approved this restructuring on January 31, 2011. On October 1, 2013, the Partnership entered into an updated restructured limited partnership agreement with Rare Earth to allow for the sale of additional interest units in the Tucson entity for $10,000 per unit. Under the agreement, Rare Earth agreed to either purchase or bring in other investors to purchase up to 160 (and potentially up to 200 if the overallotment is exercised) units. Under the terms of the updated restructuring agreement, the Partnership agreed to hold at least 50.1% of the outstanding limited partnership units in the Tucson entity, on a post-transaction basis, and intends to maintain this minimum ownership percentage through the purchase of units under this offering. The Board of Trustees approved this restructuring on September 14, 2013. The limited partnership interests in the Tucson entity are allocated to three classes with differing cumulative discretionary priority distribution rights through June 30, 2017. Class A units are owned by unrelated third parties and have first priority for distributions. Class B units are owned by the Partnership and have second priority for distributions. Class C units are owned by Rare Earth or other affiliates of Mr. Wirth and have the lowest priority for distributions from the Tucson entity. Priority distributions of $700 per unit per year are cumulative until June 30, 2016; however, after June 30, 2016 Class A unit holders continue to hold a preference on distributions over Class B and Class C unit holders. If certain triggering events related to the Tucson entity occur prior to the payment of all accumulated distributions to its members, such accumulated distributions will be paid out of any proceeds of the event before general distribution of the proceeds to the members. In the event that funds generated from a triggering event are insufficient to pay the total amount of all such accumulated distributions owed to the members, all Class A members will participate pro rata in the funds available for distribution to them until paid in full, then Class B, and then Class C. After all investors have received their initial capital plus a 7% per annum simple return, any additional profits will be allocated 50% to Rare Earth, with the remaining 50% allocated proportionately to all unit classes. Rare Earth also received a restructuring fee of $128,000, conditioned upon and arising from the sale of the first 100 units in the Tucson entity following the October 1, 2013 restructuring. The Tucson entity plans to use its best efforts to pay the discretionary priority distributions. The Trust does not guarantee and is not otherwise obligated to pay the cumulative discretionary priority distributions. InnSuites Hotels will continue to provide management, licensing and reservation services to the Tucson, Arizona property. During the fiscal year ended January 31, 2018, there were no units of the Tucson entity sold. As of January 31, 2018, the Partnership held a 51.01% ownership interest, or 404 Class B units, in the Tucson entity, Mr. Wirth and his affiliates held a 0.38% interest, or approximately 3 Class C units, and other parties held a 48.61% interest, or approximately 385 Class A units. For the fiscal year ended January 31, 2018, the Tucson entity made discretionary Priority Return payments to unrelated unit holders of approximately $272,000 and to the Partnership of approximately $283,000. As of February 1, 2017, the Trust no longer accrues for these distributions as the preference period has expired. |
Sale of Ownership Interests i11
Sale of Ownership Interests in Yuma Hospitality Properties Subsidiary | 12 Months Ended |
Jan. 31, 2018 | |
Sale Of Ownership Interests In Yuma Hospitality Properties Subsidiary | |
Sale of Ownership Interests in Yuma Hospitality Properties Subsidiary | 5. SALE OF OWNERSHIP INTERESTS IN YUMA HOSPITALITY PROPERTIES SUBSIDIARY On October 24, 2014, the Trust and Partnership entered into a restructuring agreement with Rare Earth to allow for the sale of non-controlling interest units in Yuma Hospitality Properties, Limited Partnership (the “Yuma entity”) for $10,000 per unit, which operates the Yuma hotel property, then wholly-owned by the Trust. Prior to the agreement there were 750 units outstanding and as a result of the agreement, an additional 50 units will be created for sale. Under the agreement, Rare Earth agreed to either purchase or bring in other investors to purchase up to 398 units, which represents approximately 49% of the outstanding partnership units in the Yuma entity, on a post-transaction basis, and the parties agreed to restructure the limited partnership agreement of the Yuma entity. The Board of Trustees approved this restructuring on October 24, 2014. Under the restructured limited partnership agreement, Rare Earth became a general partner of the Yuma entity along with the Trust and Partnership. The limited partnership interests in the Yuma entity are allocated to three classes with differing cumulative discretionary priority distribution rights through January 31, 2020. Class A units are owned by unrelated third parties and have first priority for distributions. Class B units are owned by the Trust and have second priority for distributions. Class C units are owned by Rare Earth or other affiliates of Mr. Wirth and have the lowest priority for distributions from the Yuma entity. Priority distributions of $700 per unit per year are cumulative until January 31, 2020. After January 31, 2020, all Partnership Interests will share equally in all distributions. If certain triggering events related to the Yuma entity occur prior to the payment of all accumulated distributions to its members, such accumulated distributions will be paid out of any proceeds of the event before general distribution of the proceeds to the members. In the event that funds generated from a triggering event are insufficient to pay the total amount of all such accumulated distributions owed to the members, all Class A members will participate pro rata in the funds available for distribution to them until paid in full, then Class B, and then Class C. After all investors have received their initial capital plus a 7% per annum simple return, any additional profits will be allocated 50% to Rare Earth, with the remaining 50% allocated proportionately to all unit classes. Rare Earth will receive a restructuring fee of $350,000, conditioned upon and arising from the sale of the first 150 units in the Yuma entity following the October 24, 2014 restructuring. The Trust has paid out $350,000 of the restructuring fee at January 31, 2016. The Yuma entity is required to use its best efforts to pay the priority distributions. The Trust does not guarantee and is not otherwise obligated to pay the cumulative priority distributions. InnSuites Hotels will continue to provide management, licensing and reservation services to the Yuma, Arizona property. On February 15, 2017, the Trust and Partnership entered into a restructuring agreement with Rare Earth to allow for the sale of non-controlling partnership units in the Yuma entity for $10,000 per unit. Rare Earth and the Trust are restructuring the Yuma Partnership Interest from General Partner majority-owned to accredited investor majority-owned. Total interests outstanding will remain unchanged at 800 with Class A, Class B and Class C Limited Liability Limited Partnership Interests (referred to collectively as “Interests”) restructured with the Yuma entity purchasing 300 existing IHT Class B Interests and reissuing 300 Class A units to accredited investors as Class A Interests causing the Yuma entity to offer and sell up to approximately 300 Class A (2017 series) Interests. Rare Earth, as a General Partner of the Yuma entity, will coordinate the offering and sale of Class A Interests to qualified third parties. Rare Earth and other Rare Earth affiliates may purchase Interests under the offering. The Trust paid $240,000 as a restructuring fee to Rare Earth during the fiscal year ended January 31, 2018, which was included in equity. During the fiscal year ended January 31, 2018, there were 298.70 Class B units, of which all were sold from the Trust at $10,000 per unit. As of January 31, 2018, the Trust held a 12.79% ownership interest, or 102.30 Class B units, in the Yuma entity, Mr. Wirth and his affiliates held a 0.63% interest, or 5.0 Class C units, and other parties held an 86.59% interest, or 692.70 Class A units. For the fiscal year ending January 31, 2018, the Yuma entity made discretionary Priority Return payments to the Trust of approximately $231,000 and to Rare Earth of approximately $360,500. |
Variable Interest Entity
Variable Interest Entity | 12 Months Ended |
Jan. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entity | 6. VARIABLE INTEREST ENTITY Management evaluates the Trust’s explicit and implicit variable interests to determine if they have any variable interests in VIEs. Variable interests are contractual, ownership, or other pecuniary interests in an entity whose value changes with changes in the fair value of the entity’s net assets, exclusive of variable interests. Explicit variable interests are those which directly absorb the variability of a VIE and can include contractual interests such as loans or guarantees as well as equity investments. An implicit variable interest acts the same as an explicit variable interest except it involves the absorbing of variability indirectly, such as through related party arrangements or implicit guarantees. The analysis includes consideration of the design of the entity, its organizational structure, including decision making ability over the activities that most significantly impact the VIE’s economic performance. GAAP requires a reporting entity to consolidate a VIE when the reporting entity has a variable interest, or combination of variable interest, that provides it with a controlling financial interest in the VIE. The entity that consolidates a VIE is referred to as the primary beneficiary of that VIE. The Partnership has determined that the Yuma and Albuquerque entities are variable interest entities with the Partnership as the primary beneficiary with the ability to exercise control, as determined under the guidance of ASC Topic 810-10-25. In its determination, management considered the following qualitative and quantitative factors: a) The Partnership, Trust and their related parties, which share common ownership and management, have guaranteed material financial obligations of the Yuma entity and Albuquerque, including its mortgage note payable and distribution obligations, which based on the capital structure of the Yuma entity, management believes could potentially be significant. b) The Partnership, Trust and their related parties have maintained, as a group, a controlling ownership interest in the Albuquerque entity and Yuma, with the largest ownership belonging to the Partnership. c) The Partnership, Trust and their related parties have maintained control over the decisions which most impact the financial performance of the Yuma entity, including providing the personnel to operate the property on a daily basis. During the fiscal year ended January 31, 2018, neither the Trust nor the Partnership have provided any implicit or explicit financial support for which they were not previously contracted. Both the Partnership and the Trust provided mortgage loan guarantees which allowed our properties to obtain new financing as needed. |
Property, Plant, and Equipment
Property, Plant, and Equipment and Hotel Properties | 12 Months Ended |
Jan. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant, and Equipment and Hotel Properties | 7. PROPERTY, PLANT, AND EQUIPMENT AND HOTEL PROPERTIES As of January 31, 2018 and 2017, hotel properties consisted of the following: 2018 2017 (i) Land $ 2,805,015 $ 4,438,079 Building and improvements 18,066,151 25,458,137 Furniture, fixtures and equipment 5,621,820 6,521,257 Total hotel properties 26,492,986 36,417,473 Less accumulated depreciation (12,124,650 ) (17,022,739 ) Hotel Properties in Service, net 14,368,336 19,394,734 Construction in progress 76,683 - Hotel properties, net $ 14,445,019 $ 19,394,734 (i) Includes discontinued operations As of January 31, 2018 and 2017, property, plant and equipment consisted of the following: 2018 2017 Land $ 7,005 $ 7,005 Building and improvements 75,662 75,662 Furniture, fixtures and equipment 1,178,941 852,332 Total property, plant and equipment 1,261,608 934,999 Less accumulated depreciation (694,876 ) (554,868 ) Property, Plant and Equipment, net $ 566,732 $ 380,131 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets | 12 Months Ended |
Jan. 31, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Prepaid Expenses and Other Current Assets | 8. PREPAID EXPENSES AND OTHER CURRENT ASSETS Prepaid expenses and other current assets are carried at historic cost and are expected to be consumed within one year. As of January 31, 2018, and 2017, prepaid expenses and other current assets consisted of the following: 2018 2017 Prepaid Assets $ 15,545 $ 48,922 Tax and Insurance Escrow 57,235 58,790 Deposits 8,000 14,805 Prepaid Insurance 7,417 8,130 Prepaid Workman’s Compensation 7,617 43,054 Miscellaneous Prepaid Expenses 17,636 3,953 Total Prepaid Expenses and Current Assets $ 113,450 $ 177,654 |
Intangible Assets, Goodwill and
Intangible Assets, Goodwill and Impairment | 12 Months Ended |
Jan. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Intangible Assets, Goodwill and Impairment | 9. INTANGIBLE ASSETS, GOODWILL AND IMPAIRMENT On January 8, 2016, the Trust and IBC Hotels purchased the tangible and intangible assets excluding cash, receivables, prepaid booking/expenses, accrued expenses, and an automobile from Vacation Technologies International, Inc., a Texas Corporation, dba International Vacation Hotels (“International Vacation Hotels”). Assets purchased primarily consist of hotel revenue booking contracts, websites and other key business intangible assets. The transaction has been accounted for as a business combination under the acquisition method of accounting. Tangible assets acquired were considered worthless and therefore were not separately valued. Accordingly, the identifiable intangible assets acquired have been recorded at fair value, with the remaining purchase price recorded as goodwill. The fair values of assets acquired at the transaction date are summarized below: Marketing Related Intangibles $ 100,000 Customer Base 400,000 Total identifiable intangible assets 500,000 Goodwill 500,000 Total acquired assets $ 1,000,000 Over the past several fiscal years, the Trust has made significant investment in IBC Hotels, including its investment in the purchase of International Vacation Hotels for $1 million in January 2016. In the fiscal year ended January 31, 2017, the Trust incurred approximately $1 million net operating loss from IBC Hotels. In the fiscal year ended January 31, 2018, IBC Hotels lost approximately $1.6 million excluding the write-off of the intangible assets. After assessing the totality of events and circumstances including the historical losses and projected losses, the Trust determined that it is more likely than not that the fair value of IBC Hotels is less than its carrying value. Accordingly, Management has decided to write down the entire amount of intangible assets as of January 31, 2018 as such amounts are not considered recoverable. Intangible Assets For the fiscal year ending January 31, 2018, intangible assets consisted of the following: Amount Fiscal Year January 31, 2018 Impairment Expense Fiscal year 1/31/2017 Accumulated Amortization Net Amount Useful Lives (years) Marketing Related Intangibles $ 100,000 $ 90,000 $ 10,000 $ - 10 Customer Base 400,000 343,000 57,000 - 7 Total: $ 500,000 $ 433,000 $ 67,000 $ - The Trust recorded amortization of goodwill expense of $433,000 and $67,000 for the years ended January 31, 2018 and 2017, respectively. Goodwill The changes in the carrying value of the Trust’s goodwill for the years ended January 31, 2018 and 2017 is as follows: Beginning Balance January 31, 2016 $ - Acquisition of Vacation Technology Hotels 500,000 Ending Balance January 31, 2017 500,000 Impairment (500,000 ) Ending Balance January 31, 2018 $ - |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 12 Months Ended |
Jan. 31, 2018 | |
Payables and Accruals [Abstract] | |
Accounts Payable and Accrued Expenses | 10. ACCOUNTS PAYABLE AND ACCRUED EXPENSES As of January 31, 2018 and 2017, accounts payable and accrued expenses consisted of the following: 2018 (i) 2017 Accounts Payable $ 741,917 $ 1,025,749 Accrued Salaries and Wages 271,739 257,259 Accrued Vacation 38,957 32,608 Income Tax Payable 340,169 20,000 Accrued Interest Payable 26,565 52,852 Advanced Customer Deposits 15,000 11,832 Accrued Property Taxes 140,439 190,533 Accrued Land Lease 130,015 98,175 Sales Tax Payable 305,071 163,772 Deferred Revenue 107,467 133,146 Accrued Other 180,813 177,974 Total Accounts Payable and Accrued Expenses $ 2,298,152 $ 2,163,900 (i) Includes current liabilities of discontinued operations. |
Mortgage Notes Payable
Mortgage Notes Payable | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Mortgage Notes Payable | 11. MORTGAGE NOTES PAYABLE At January 31, 2018 and 2017, the Trust had mortgage notes payable outstanding with respect to each of the Hotels except the Albuquerque property. The mortgage notes payable have various repayment terms and have scheduled maturity dates ranging from August 2022 to June 2042. Weighted average annual interest rates on the mortgage notes payable for the fiscal years ended January 31, 2018 and 2017 were 4.85% and 4.65%, respectively. The following table summarizes the Trust’s mortgage notes payable, net of debt discounts, as of January 31: 2018 2017 Mortgage note payable, due in monthly installments of $28,493, including interest at 4.69% per year, through June 19, 2042, secured by the Tucson Oracle property with a carrying value of $7.6 million at January 31, 2018. 4,927,076 3,112,112 Mortgage note payable, due in monthly installments of $32,419, including interest at the prime rate plus one percentage point over the index, with a floor of 5.0% per year (5% per year as of January 31, 2015), through August 1, 2022 plus a balloon payment of $4,112,498 in September 2022, secured by the Yuma property with a carrying value of $4.8 million at January 31, 2018. 4,827,259 4,963,645 Totals: $ 9,754,335 $ 8,075,757 The mortgage note payable secured by the Yuma hotel property is recourse to the Trust as a full guarantor. None of the other mortgage notes are recourse to the Partnership or the Trust. On August 24, 2012, the Yuma entity entered into a $5,500,000 mortgage loan with 1 st On November 24, 2014, the Tucson Oracle entity entered into a $3,500,000 mortgage loan with Kansas State Bank of Manhattan to acquire the land associated with this property, re-finance the existing Tucson hotel loan first deed of trust and pay off other existing debt. This new loan lowered the interest rate for this property’s mortgage from 8.0% to 4.19% per annum. The $3,500,000 commercial real estate loan has a 15 year term with a 4.19% per annum fixed interest rate for five years, and adjusts annually based upon the Weekly Average Yield of the US Treasury Securities, with a 4.19% floor. The loan closed simultaneous to the land purchase. Rare Earth, the Partnership, the Trust, the Wirth Family Trust dated July 14, 2006 and James and Gail Wirth are joint guarantors. On June 29, 2017, Tucson Oracle entered into a $5.0 million Business Loan Agreement (“Tucson Loan”) as a first mortgage credit facility with KS State Bank to refinance the existing first mortgage credit facility with an approximate payoff balance of $3.045 million which will allow Tucson Hospitality Properties, LLLP to be reimbursed for prior and future hotel improvements. The Tucson Loan has a maturity date of June 19, 2042. The Tucson Loan has an initial interest rate of 4.69% for the first five years and thereafter a variable rate equal to the US Treasury + 2.0% with a floor of 4.69% and no prepayment penalty. This credit facility is guaranteed by InnSuites Hospitality Trust, RRF Limited Partnership, Rare Earth Financial, LLC, James F. Wirth and Gail J. Wirth and the Wirth Family Trust dated July 14, 2016. As of January 31, 2018, the mortgage loan balance was approximately $4,927,000, net of a discount of approximately $5,000. See Note 15 – “Minimum Debt Payments” for scheduled minimum payments on the mortgage notes payable. |
Notes Payable to Banks
Notes Payable to Banks | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Notes Payable to Banks | 12. NOTES PAYABLE TO BANKS On January 8, 2016, in connection with the acquisition of substantially all of the assets of International Vacation Hotels, the Trust entered into a $400,000 business loan with Laurence Holdings Limited, an Ontario, Canada corporation, with a maturity date of February 1, 2019 pursuant to the terms of the Security Agreement and Promissory Note (the “Laurence Holdings Agreement”). The Laurence Holdings Agreement required the funds be used for the purchase of International Vacation Hotels assets. The Laurence Holdings Agreement provides for interest-only payments for the first three months of the term and principal and interest payments for the remaining portion of the loan. The Laurence Holdings Agreement sets an interest rate of 8% per annum with no prepayment penalty. As of January 31, 2018, the business loan balance was approximately $124,000, net of a discount of approximately $2,000. On May 3, 2016, the Trust and Yuma Hospitality Properties Limited Partnership, a subsidiary of the Trust entered into a $350,000 one-year line of credit with RepublicBank AZ, N.A. (the “RepublicBank AZ Agreement”). The Republic Bank AZ agreement includes acceleration provisions upon default. The funds may be used for working capital and is guaranteed by James Wirth, the Trust’s Chairman and CEO, Gail Wirth, the Trust’s Chairman and CEO’s spouse and the Wirth Family Trust Dated July 14, 2006. As of January 31, 2018, the line of credit balance has been paid in full. On May 11, 2017, Yuma Hospitality Properties, LLLP entered into a $850,000 Promissory Note Agreement (“Yuma Loan Agreement”) as a credit facility to replenish funds for the hotel remodel with 1st Bank of Yuma Arizona Bank & Trust with a maturity date of September 1, 2022. The Yuma Loan Agreement has an initial interest rate of 5.50% with a variable rate adjustment equal to the Wall Street Journal Prime Rate plus 1.50% with a floor of 5.50% and no prepayment penalty. This credit facility is guaranteed by InnSuites Hospitality Trust. As of January 31, 2018, the loan balance was approximately $828,000, net of a discount of approximately $6,000. See Note 15 – “Minimum Debt Payments” for scheduled minimum payments on the mortgage notes payable. |
Lines of Credit - Related Party
Lines of Credit - Related Party | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Lines of Credit - Related Party | 13. LINES OF CREDIT – RELATED PARTY On December 1, 2014, the Trust entered into a $1,000,000 net maximum Demand/Revolving Line of Credit/Promissory Note with Rare Earth. The Demand/Revolving Line of Credit/Promissory Note bears interest at 7.0% per annum, is interest only quarterly and matures on December 31, 2018. No prepayment penalty exists on the Demand/Revolving Line of Credit/Promissory Note. The balance fluctuates significantly through the period with the highest payable balance being $630,000 during the fiscal year ended January 31, 2018. The Demand/Revolving Line of Credit/Promissory Note has a net maximum borrowing capacity of $1,000,000. Related party interest expense or income for the Demand/Revolving Line of Credit/Promissory Note for the fiscal years ended January 31, 2018 was $4,768 of expense and $15,567 of revenue, and for the fiscal year ended January 31, 2017 was $5,112 of expense. The Demand/Revolving Line of Credit/Promissory Notes are presented together as one line item on the balance sheet and totaled a receivable of $810,799, and a payable of $145,000 at January 31, 2018 and 2017, all of which is considered a current receivable and liability, respectively. |
Other Notes Payable
Other Notes Payable | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Other Notes Payable | 14. OTHER NOTES PAYABLE As of January 31, 2018 the Trust had approximately $959,000 in promissory notes outstanding to unrelated third parties arising from the repurchase of 91,259 Class A Partnership units in privately negotiated transactions and the repurchase of 524,930 Shares of Beneficial Interest in privately negotiated transactions. These promissory notes bear interest at 7% per year and are due in varying monthly payments through July 2020. As of January 31, 2017 the Trust had approximately $18,000 in promissory notes outstanding to unrelated third parties arising from the repurchase of 9,903 Partnership Units and 3,259 IHT Shares of Beneficial Interest in privately negotiated transactions. These promissory notes bear interest at 7% per year and are due in varying monthly payments through June 2019. As of January 31, 2018, the Trust had $200,000 notes payable with an individual lender. On June 20, 2016, the Trust and the Partnership together entered into an unsecured loan of $80,000 with Guy C. Hayden III (“Hayden Loan”). The Hayden loan is due on June 20, 2019 or on demand, whichever occurs first. The Hayden loan accrues interest at 7% and interest only payments shall be made monthly and are due on the first of the following month. The Trust and Partnership may pay all of part of these notes without any repayment penalties. On March 1, 2017, the Trust and the Partnership together added an additional $36,960 to the Hayden Loan. On May 30, 2017, the Trust and the Partnership together added an additional $63,040 to the Hayden Loan. On July 18, 2017 the Trust and Partnership together added an additional $90,000 to the Hayden Loan. The total principal amount of the Hayden Loan is $270,000. On December 5, 2016, the Trust and the Partnership together entered into eight unsecured loans for a total of $425,000 with varying principal amounts ranging from $25,000 to $100,000 with H. W. Hayes Trust (“Hayes Loans”). The Trust and the Partnership together also entered into two unsecured on-demand $25,000 loans for a total of $50,000 with Lita M. Sweitzer (“Sweitzer Loans”). On March 20, 2017, the Trust and Partnership added an additional $50,000 to the Sweitzer Loans. The total principal amount of the Hayes Loans and the Sweitzer Loans is $525,000. The Hayes Loans and the Sweitzer Loans are due on June 20, 2019 or on demand, whichever occurs first. The Hayes Loans requires from a 0-120 day notification of the demand to repay the loans prior to June 20, 2019. Both the Hayes Loans and the Sweitzer Loans accrue interest at 7.0% per year on the unpaid balance and interest only payments shall be made monthly and are due on the first of the following month. The Trust and Partnership may pay all or part of these notes without any repayment penalties. See Note 15 – “Minimum Debt Payments” for scheduled minimum payments on the mortgage notes payable. |
Minimum Debt Payments
Minimum Debt Payments | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Minimum Debt Payments | 15. MINIMUM DEBT PAYMENTS Scheduled minimum payments of debt, net of debt discounts, as of January 31, 2018 are as follows in the respective fiscal years indicated: FISCAL YEAR MORTGAGES NOTES PAYABLE TO BANK OTHER NOTES PAYABLE TOTAL 2019 $ 254,460 144,185 $ 1,355,664 $ 1,754,309 2020 267,441 21,625 378,817 667,883 2021 278,588 22,868 216,489 517,945 2022 295,336 22,552 3,433 321,321 2023 4,330,880 740,983 - 5,071,863 Thereafter 4,327,630 - - 4,327,630 $ - $ 9,754,335 $ 952,213 $ 1,954,403 $ 12,660,951 |
Description of Beneficial Inter
Description of Beneficial Interests | 12 Months Ended |
Jan. 31, 2018 | |
Description Of Beneficial Interests | |
Description of Beneficial Interests | 16. DESCRIPTION OF BENEFICIAL INTERESTS Holders of the Trust’s Shares of Beneficial Interest are entitled to receive dividends when and if declared by the Board of Trustees of the Trust out of funds legally available therefore. The holders of Shares of Beneficial Interest, upon any liquidation, dissolution or winding-down of the Trust, are entitled to share ratably in any assets remaining after payment in full of all liabilities of the Trust. The Shares of Beneficial Interest possess ordinary voting rights, each share entitling the holder thereof to one vote. Holders of Shares of Beneficial Interest do not have cumulative voting rights in the election of Trustees and do not have preemptive rights. On January 2, 2001, the Board of Trustees approved a share repurchase program under Rule 10b-18 of the Securities Exchange Act of 1934, as amended, for the purchase of up to 250,000 Partnership units and/or Shares of Beneficial Interest in open market or privately negotiated transactions. On September 10, 2002, August 18, 2005 and September 10, 2007, the Board of Trustees approved the purchase of up to 350,000 additional Partnership units and/or Shares of Beneficial Interest in open market or privately negotiated transactions. Additionally, on January 5, 2009, September 15, 2009 and January 31, 2010, the Board of Trustees approved the purchase of up to 300,000, 250,000 and 350,000, respectively, additional Partnership units and/or Shares of Beneficial Interest in open market or privately negotiated transactions. Acquired Shares of Beneficial Interest will be held in treasury and will be available for future acquisitions and financings and/or for awards granted under the Trust’s equity compensation plans/programs. Additionally, on June 19, 2017, the Board of Trustees approved a share repurchase program under Rule 10b-18 of the Securities Exchange Act of 1934, as amended, for the purchase of up to 750,000 Partnership units and/or Shares of Beneficial Interest in open market or privately negotiated transactions. Acquired Shares of Beneficial Interest will be held in treasury and will be available for future acquisitions and financings and/or for awards granted under the InnSuites Hospitality Trust 1997 Stock Incentive and Option Plan. For the years ended January 31, 2018 and 2017, the Trust repurchased 150,973 and 30,277 Shares of Beneficial Interest at an average price of $1.99 and $2.55 per share, respectively. The average price paid includes brokerage commissions. The Trust intends to continue repurchasing Shares of Beneficial Interest in compliance with applicable legal and NYSE AMERICAN requirements. The Trust remains authorized to repurchase an additional 662,117 Partnership units and/or Shares of Beneficial Interest pursuant to the publicly announced share repurchase program, which has no expiration date. Repurchased Shares of Beneficial Interest are accounted for as treasury stock in the Trust’s Consolidated Statements of Shareholders’ Equity. |
Federal Income Taxes
Federal Income Taxes | 12 Months Ended |
Jan. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Federal Income Taxes | 17. FEDERAL INCOME TAXES The Trust and subsidiaries have income tax net operating loss carryforwards of approximately $4.8 million at January 31, 2018. In 2005, the Trust had an ownership change within the meaning of Internal Revenue Code Section 382. However, the Trust determined that such ownership change would not have a material impact on the future use of the net operating losses. Income taxes for the years ended January 31, 2018 2017 Current income tax provision (benefit) 335,000 (227,000 ) Deferred income tax provision (benefit) - - Net income tax expense (benefit) $ 335,000 $ (227,000 ) Total and net deferred income tax assets at January 31, 2018 2017 Net operating loss carryforwards $ 2,763,000 $ 4,040,000 Bad debt allowance (22,000 ) (18,000 ) Accrued expenses 89,000 84,000 Syndications 5,179,000 5,179,000 Prepaid Insurance 30,000 30,000 Alternative minimum tax credit 91,000 91,000 Total deferred tax assets 8,130,000 9,406,000 Deferred income tax liability associated with book/tax differnces in hotel properties (2,884,000 ) (2,459,000 ) Net deferred income tax asset 5,246,000 6,947,000 Valuation allowance (5,246,000 ) (6,947,000 ) Net deferred income tax $ - $ - A reconciliation of the differences between the effective and statutory income tax rates for years ended January 31, is as follows: Income taxes for the years ended January 31, 2018 2017 Current income tax provision (benefit) 341,000 (227,000 ) Deferred income tax provision (benefit) - - Net income tax expense (benefit) $ 341,000 $ (227,000 ) A reconciliation of the differences between the effective and statutory income tax rates for years ended January 31, is as follows: 2018 Amount Percent Federal statutory rates $ 1,604,000 34 % State income taxes 636,000 13 % Changes in valuation allowance (1,703,000 ) (36 )% True-up to prior year returns (240,000 ) (5 )% Other 44,000 1 % Effective rate $ 341,000 7 % 2017 Amount Percent Federal statutory rates $ (878,000 ) (34 )% State income taxes (196,000 ) (8 )% Changes in valuation allowance 1,445,000 56 % True-up to prior year returns (593,000 ) (23 )% Other (5,000 ) 0 % Effective rate $ (227,000 ) (9 )% The true-ups to prior year return related primarily to the sale of syndication units in the Trust’s subsidiaries which are treated as equity transactions in the Trust’s financial statements but are taxed as capital gain transactions and total $240,000 which were then offset by the release of valuation allowances. The Trust’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Trust had no material accrued interest or penalties at January 31, 2018 and 2017. |
Other Related Party Transaction
Other Related Party Transactions | 12 Months Ended |
Jan. 31, 2018 | |
Other Related Party Transactions | |
Other Related Party Transactions | 18. OTHER RELATED PARTY TRANSACTIONS As of January 31, 2018 and 2017, Mr. Wirth and his affiliates held 3,064,038 and 3,407,938 Class B Partnership units, which represented 23.86% and 25.8% of the total outstanding Partnership units, respectively. As of January 31, 2018 and 2017, Mr. Wirth and his affiliates held 6,939,429 and 6,939,429, respectively, Shares of Beneficial Interest in the Trust, which represented 70.99% and 71.93%, respectively, of the total issued and outstanding Shares of Beneficial Interest. As of January 31, 2018 and 2017, the Trust owned 74.80% and 72.11% of the Partnership, respectively. As of January 31, 2018, the Partnership owned a 51.01% interest in the InnSuites® hotel located in Tucson. The Trust also owned a direct 12.79% interest in one InnSuites® hotel located in Yuma, Arizona and owned a direct 22.83% interest in one InnSuites® hotel located in Albuquerque, New Mexico. The Trust directly manages the Hotels through the Trust’s wholly-owned subsidiary, InnSuites Hotels Inc. Under the management agreements, InnSuites Hotels Inc. manages the daily operations of the Hotels and the two hotels owned by affiliates of Mr. Wirth. Revenues and reimbursements among the Trust, InnSuites Hotels Inc. and the Partnership have been eliminated in consolidation. The management fees for the Hotels and the two hotels owned by affiliates of Mr. Wirth are set at 3.0% of room revenue and a monthly accounting fee of $2,000 per hotel. As of May 1, 2017, management fees increased to 5.0% of room revenues. These agreements have no expiration date and may be cancelled by either party with 90-days written notice or 30-days written notice in the event the property changes ownership. During the years ended January 31, 2018 and 2017, the Trust recognized approximately $200,000 and approximately $296,000, respectively of revenue. On January 28, 2016, pursuant to a Securities Purchase Agreement, the Trust issued 60,000 Shares of Beneficial Interest to Rare Earth at a purchase price of $2.50 per share, for proceeds of $150,000 to the Trust. The transaction was approved by the Board of Trustees and the Audit Committee of the Trust. The issuance of the Shares of Beneficial Interest by the Trust to Rare Earth was made in reliance upon the exemption from the registration requirements of the Securities Act pursuant to Section 4(a)(2). On July 23, 2013, the Trust entered into a Corporate Card Agreement (“Corporate Purchase Cards”) with American Express Travel Related Services Company, Inc. The Corporate Card Agreement distributed a total of nine purchase cards - one to each of the four respective Hotels, one to the Trust, and one to each of the two respective hotels owned by affiliates of James F. Wirth. The Corporate Purchase Cards, with a total limit of $50,000, includes insignificant annual fees and $0 of interest per annum. Payments are due monthly. The Corporate Card Agreement may be cancelled by either party with 30-days written notice. Pamela J. Barnhill, the Trust’s President and Vice Chairperson and daughter of Mr. Wirth, initiated the nine purchase cards. As of January 31, 2018 and 2017, the Trust’s portion of the Corporate Purchase Cards balance was approximately $0 and $115,000, respectively. The Tucson Oracle property has an unsecured demand/revolving line of credit/promissory note as described in Note 13 – Lines of Credit - Related Party. The Trust has an unsecured demand/revolving line of credit/promissory note as described in Note 13 – Lines of Credit - Related Party. During the fiscal years ended January 31, 2018 and 2017, the Trust paid Berg Investment Advisors $42,500 and $3,500, respectively, for additional consultative services rendered by Mr. Marc Berg, the Trust’s Executive Vice President. Besides Pamela Barnhill, Vice Chairperson and President of the Trust and daughter of Mr. Wirth, the Trust’s Chairman and Chief Executive Officer, the Trust also employs two other immediate family members of Mr. Wirth who provide technology and administrative support services to the Trust with each receiving a $47,500 yearly salary. During the fiscal years ended January 31, 2018 and 2017, Rare Earth received restructuring fees of $440,000 and $0, respectively, relating to the syndications of our Yuma, Arizona and Albuquerque, New Mexico hotel properties (see Notes 3 and 5). On December 22, 2015, the Trust provided Advances to Affiliate – Related Party each in the amount of $500,000 to Phoenix Northern Resort, LLC and Tempe/Phoenix Airport Resort LLC. Mr. Wirth, individually and thru one of his affiliates owns approximately 100% and 42%, respectively, of Phoenix Northern Resort, LLC and Tempe/Phoenix Airport Resort LLC. Both notes have a due date of June 30, 2018 and accrue interest of 7.0%. During the fiscal year ended January 31, 2018, the Trust received $0 and $17,061 interest income from Phoenix Northern Resort, LLC and Tempe/Phoenix Airport Resort LLC, respectively. As of January 31, 2018, the Advances from Affiliate – Related Party balance was $0 and $970,353 from Phoenix Northern Resort, LLC and Tempe/Phoenix Airport Resort LLC, respectively. As of January 31, 2017, the Lending from Affiliate – Related Party balance was $19,483 and $359,684 from Phoenix Northern Resort, LLC and Tempe/Phoenix Airport Resort LLC, respectively. |
Fair Value of Financial Instrum
Fair Value of Financial Instruments | 12 Months Ended |
Jan. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Instruments | 19. FAIR VALUE OF FINANCIAL INSTRUMENTS The following table presents the estimated fair values of the Trust’s debt instruments and the associated carrying value recognized in the accompanying consolidated balance sheets at January 31, 2018 and 2017: 2018 2017 Carrying Amount Fair Value Carrying Amount Fair Value Mortgage notes payable $ 9,752,596 $ 8,164,897 $ 13,367,706 $ 13,473,018 Notes payable to banks $ 952,213 $ 952,213 $ 2,019,758 $ 2,019,758 Other notes payable $ 1,954,405 $ 1,954,405 $ 18,069 $ 18,195 |
Supplemental Cash Flow Disclosu
Supplemental Cash Flow Disclosures | 12 Months Ended |
Jan. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Supplemental Cash Flow Disclosures | 20. SUPPLEMENTAL CASH FLOW DISCLOSURES 2018 2017 Cash paid for interest $ 539,072 $ 743,932 Notes Payables - IHT Shares of Beneficial Interest and Partnership Units repurchases $ 1,141,756 $ 7,006 |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Jan. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 21. COMMITMENTS AND CONTINGENCIES Leases: The Albuquerque Hotel is subject to non-cancelable ground lease. The Albuquerque Hotel non-cancelable ground lease was extended on January 14, 2014 and expires in 2058. Total expense associated with the non-cancelable ground lease for the fiscal years ended January 31, 2018 and 2017 was $149,608 and $147,587, respectively On August 4, 2017, the Trust entered into a five year office lease agreement with Northpoint Properties for a commercial office lease at 1730 E Northern Ave, Suite 122, Phoenix, Arizona 85020 commencing on September 1, 2017. Base monthly rent of $4,100 increases 6% on a yearly basis. No rent is due for October 2018 and October 2022 months. The Trust also agreed to pay electricity and applicable sales tax. The office lease agreement provides early termination with a 90 day notification with an early termination fee of $12,000, $8,000, $6,000, $4,000 and $2,000 for years 1 – 5 of the lease term. Future minimum lease payments under these non-cancelable ground lease and office lease are as follows: Fiscal Year Ending FY 2019 164,184 FY 2020 167,225 FY 2021 170,448 FY 2022 173,864 FY 2023 144,565 Thereafter 5,473,313 Total 6,293,599 Restricted Cash: The Trust is obligated under a loan agreement relating to the Tucson Oracle property to deposit 4% of the individual hotel’s room revenue into an escrow account to be used for capital expenditures. The escrow funds applicable to the Tucson Oracle property for which a mortgage lender escrow exists is reported on the Trust’s Consolidated Balance Sheet as “Restricted Cash.” Since a $0 cash balance existed in Restricted Cash for the fiscal years 2018 and 2017, Restricted Cash line was omitted on the Trust’s Consolidated Balance Sheet. Membership Agreements: InnSuites Hotels has entered into membership agreements with Best Western International, Inc. (“Best Western”) for four of the hotel properties. In exchange for use of the Best Western name, trademark and reservation system, all Hotels pay fees to Best Western based on reservations received through the use of the Best Western reservation system and the number of available suites at the Hotels. The agreements with Best Western have no specific expiration terms and may be cancelled by either party. Best Western requires that the hotels meet certain requirements for room quality, and the Hotels are subject to removal from its reservation system if these requirements are not met. The Hotels with third-party membership agreements received significant reservations through the Best Western reservation system. Under these arrangements, fees paid for membership fees and reservations were approximately $286,000 and $483,000 for fiscal years ended January 31, 2018 and 2017, respectively. The nature of the operations of the Hotels exposes them to risks of claims and litigation in the normal course of their business. Although the outcome of these matters cannot be determined and is covered by insurance, management does not expect that the ultimate resolution of these matters will have a material adverse effect on the consolidated financial position, results of operations or liquidity of the Trust. Litigation: The Trust is involved from time to time in various other claims and legal actions arising in the ordinary course of business. In the opinion of management, the ultimate disposition of these matters will not have a material adverse effect on the Trust’s consolidated financial position, results of operations or liquidity. Indemnification: We have entered into indemnification agreements with all of our executive officers and Trustees. The agreements provide for indemnification against all liabilities and expenses reasonably incurred by an officer or Trustee in connection with the defense or disposition of any suit or other proceeding, in which he or she may be involved or with which he or she may be threatened, while in office or thereafter, because of his or her position at the Trust. There is no indemnification for any matter as to which an officer or Trustee is adjudicated to have acted in bad faith, with willful misconduct or reckless disregard of his or her duties, with gross negligence, or not in good faith in the reasonable belief that his or her action was in our best interests. These agreements require us, among other things, to indemnify the director or officer against specified expenses and liabilities, such as attorneys’ fees, judgments, fines and settlements, paid by the individual in connection with any action, suit or proceeding arising out of the individual’s status or service as our director or officer, other than liabilities arising from willful misconduct or conduct that is knowingly fraudulent or deliberately dishonest, and to advance expenses incurred by the individual in connection with any proceeding against the individual with respect to which the individual may be entitled to indemnification by us. We may advance payments in connection with indemnification under the agreements. The level of indemnification is to the full extent of the net equity based on appraised and/or market value of the Trust. Historically, we have not incurred any payments for these obligations and, therefore, no liabilities have been recorded for these indemnities in the accompanying consolidated balance sheets. |
Share-Based Payments
Share-Based Payments | 12 Months Ended |
Jan. 31, 2018 | |
Equity [Abstract] | |
Share-Based Payments | 22. SHARE-BASED PAYMENTS We compensate our non-employee Trustees for their services through grants of restricted Shares. The aggregate grant date fair value of these Shares is shown in the table above. These restricted Shares vested in equal monthly amounts during our fiscal year 2018. As of January 31, 2018, Messrs. Kutasi, Chase and Robson and Ms. Ketcherside did not hold any unvested Shares. As compensation for our fiscal year 2017, on February 10, 2017, we issued 6,000 additional restricted Shares (with the aggregate grant date fair value of $13,980 per grant) to each of Messrs. Kutasi and Robson and Ms. Ketcherside. During fiscal year 1999, the shareholders of the Trust adopted the 1997 Stock Incentive and Option Plan (the “Plan”). Pursuant to the Plan, the Compensation Committee may grant options to the Trustees, officers, other key employees, consultants, advisors and similar employees of the Trust and certain of its subsidiaries and affiliates. The number of options that may be granted in a year is limited to 10% of the total Shares of Beneficial Interest and Partnership units in the Partnership (Class A and Class B) outstanding as of the first day of such year. Generally, granted options expire 10 years from the date of grant, are exercisable during the optionee’s lifetime only by the recipient and are non-transferable. Unexercised options held by employees of the Trust generally terminate on the date the individual ceases to be an employee of the Trust. There were no options granted in fiscal year 2018 or 2017, and no options were outstanding as of January 31, 2018 and 2017. The Plan currently has 1,000,000 options available to grant. See Note 26 for additional information on stock options. The Plan also permits the Trust to award stock appreciation rights, none of which, as of January 31, 2018, have been issued. See Note 2 – “Summary of Significant Accounting Policies” for information related to grants of restricted shares under “Stock-Based Compensation.” Cash and Equity Bonuses Fiscal 2017– Short-Term Cash and Equity Bonus Program To provide incentive to get hotel operations off to a strong start for the then-current fiscal year starting February 1, 2016, on February 22, 2016, the Committee adopted an incentive bonus program for the Executives based on the targeted gross operating profit of approximately $402,000 and approximately $395,000 ( i.e., Executive Officer Cash Equity Pamela J. Barnhill $ 10,000 10,000 Shares of Beneficial Interest Marc E. Berg $ 2,500 2,500 Shares of Beneficial Interest Adam B. Remis $ 5,000 5,000 Shares of Beneficial Interest In February 2016 and March 2016, the Target GOP were achieved and each of the Executives received the cash and equity bonuses listed above. Fiscal 2017– Full Year Cash and Equity Bonus Program On February 22, 2016, the Committee adopted an incentive bonus program for the Executives for the fiscal year ended January 31, 2017 (the “2017 Fiscal Year Bonus Program”). Under the 2017 Fiscal Year Bonus Program, an Executive were to be entitled to receive a bonus consisting of cash and Shares of Beneficial Interest of the Trust up to the maximum amount set forth below upon the achievement by the Executive of performance-based objectives, which included revenue, gross operating profit and strategy for the hotel and IBC/IVH divisions and/or at the discretion of the Committee. Executive Officer Cash Equity Pamela J. Barnhill $ 25,000 10,000 Shares of Beneficial Interest Marc E. Berg $ 5,000 2,500 Shares of Beneficial Interest Adam B. Remis $ 10,000 5,000 Shares of Beneficial Interest Fiscal 2017– Payouts Under Short-Term and Full Year Cash and Equity Bonus Programs On January 24, 2017, the Compensation Committee exercised negative discretion, based on the Trust’s financial condition and its limited cash flow in fiscal 2017, and the Compensation Committee and the Board of Trustees approved the following payouts for the Executives based on the performance of the Trust and the Executives. The payouts were accrued as of January 31, 2017 and paid to the Executives in February 2017. Executive Cash Equity Pamela J. Barnhill $ 5,000 3,000 Shares of Beneficial Interest Marc E. Berg $ 1,000 750 Shares of Beneficial Interest Adam B. Remis $ 2,000 1,500 Shares of Beneficial Interest Fiscal 2018 Bonuses Fiscal 2018– Short-Term Cash and Equity Bonus Program On January 24, 2017, the Compensation Committee and the Board, with the advice from Mr. Wirth, our Chairman and Chief Executive Officer, authorized the following additional bonuses for the Executives, up to the maximum amounts listed below, which may be earned based on the growth and financial developments of IBC Hotels during the period from February 1, 2017 through May 31, 2017 and the Trust’s cash availability, with such bonuses, if any, to be paid before January 31, 2018. Executive Cash Equity Pamela J. Barnhill $ 5,000 3,000 Shares of Beneficial Interest Marc E. Berg $ 1,000 750 Shares of Beneficial Interest Adam B. Remis $ 2,000 1,500 Shares of Beneficial Interest In addition, the Compensation Committee and the Board, with the advice from Mr. Wirth, our Chairman and Chief Executive Officer, also authorized the following bonuses for the Executives, up to the maximum amounts listed below, which may be earned based on the IBC Hotels division growth and financial developments during the period from June 1, 2017 through December 31, 2017 and the Trust’s cash availability, with such bonuses, if any, to be paid before January 31, 2018. Executive Cash Equity Pamela J. Barnhill $ 10,000 4,000 Shares of Beneficial Interest Marc E. Berg $ 2,000 1,000 Shares of Beneficial Interest Adam B. Remis $ 4,000 2,000 Shares of Beneficial Interest Fiscal 2018– Full Year Cash and Equity Bonus Program On January 24, 2017, the Compensation Committee also adopted an incentive bonus program for the Executives for the full fiscal year ending January 31, 2018 (the “2018 Fiscal Year Bonus Program”). Under the 2018 Fiscal Year Bonus Program, an Executive will be entitled to receive a bonus consisting of cash and Shares of Beneficial Interest of the Trust, up to the maximum amounts set forth below, upon the achievement by the Executive of performance-based objectives which was based exceeding budgeted revenues and net income in both the hotel operations and technology division. Executive Cash Equity Pamela J. Barnhill $ 25,000 10,000 Shares of Beneficial Interest Marc E. Berg $ 5,000 2,500 Shares of Beneficial Interest Adam B. Remis $ 10,000 5,000 Shares of Beneficial Interest The bonuses discussed above are discretionary. In April 2018, the CEO determined, based on his discretionary and after carefully evaluating the financial performance of both the hotels and our technology division, decided to award 50% of the cash and equity noted above to the Executives. |
Segment Reporting
Segment Reporting | 12 Months Ended |
Jan. 31, 2018 | |
Segment Reporting [Abstract] | |
Segment Reporting | 23. SEGMENT REPORTING The Trust determined its reportable segments are the Hotel Operations and IBC Developments segments. Reportable segments are determined based on discrete financial information reviewed by the Trust’s CODM. The Trust organizes and reviews operations based on products and services, and currently there are no operating segments that are aggregated. The Trust performs an annual analysis of its reportable segments. Information relative to the Trust’s reportable segments is as follows: CONSOLIDATED BALANCE SHEET YEAR ENDED JANUARY 31, 2018 Hotel Operations & Corporate Overhead IBC Developments Total Total Assets $ 22,201,935 $ 876,137 $ 23,078,072 Total Liabilities 9,897,562 5,061,541 14,959,103 Fixed Assets, Net 14,586,879 424,872 15,011,751 CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED JANUARY 31, 2018 Hotel Operations & Corporate Overhead IBC Hospitality Total Total Revenue $ 9,319,467 $ 1,448,125 $ 10,767,592 Loss From Continuing Operations (731,888 ) (2,382,919 ) (3,114,807 ) CONSOLIDATED BALANCE SHEET YEAR ENDED JANUARY 31, 2017 Hotel Operations & Corporate Overhead IBC Developments Total Total Assets $ 20,708,359 $ 1,464,473 $ 22,172,832 Total Liabilities 15,280,624 3,266,959 18,547,583 Fixed Assets, Net 13,471,799 222,469 13,694,268 CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED JANUARY 31, 2017 Hotel Operations & Corporate Overhead IBC Hospitality Total Total Revenue $ 8,488,387 $ 708,792 $ 9,197,179 Loss From Continuing Operations (1,165,554 ) (1,189,913 ) (2,355,467 ) |
Sale of Ontario Hospitality Pro
Sale of Ontario Hospitality Properties, LP | 12 Months Ended |
Jan. 31, 2018 | |
Sale Of Ontario Hospitality Properties Lp | |
Sale of Ontario Hospitality Properties, LP | 24. SALE OF ONTARIO HOSPITALITY PROPERTIES, LP On June 2, 2017, the Trust sold its Ontario, California hotel to an unrelated third party for approximately $17.5 million, which the Trust received in cash and resulted in a gain of approximately $11.4 million. The Trust used $7.2 million of the proceeds to satisfy its mortgage note payable on the property, approximately $2.4 million to reduce accruals and payables, and retained the remaining proceeds to fund future operations and capital improvements. For the year ended January 31, 2018, Ontario entity had approximately $1,471,000 of revenue, and approximately $2,100,000 of operating expenses. As of January 31, 2018, Ontario entity had no current assets, and approximately $86,000 of current liabilities consisting of accounts payables and accrued expenses. During the years ended January 31, 2018, and January 31, 2017, depreciation/amortization and capital expenses were approximately $178,000 and $699,000, respectively. In addition, there were no significant non-cash operating and investing activities during such period. For the fiscal year ending January 31, 2018, the Ontario entity made discretionary Priority Return payments to unrelated unit holders of approximately $4,916,000 and to the Partnership of approximately $3,098,500. |
Discontinued Operations
Discontinued Operations | 12 Months Ended |
Jan. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Discontinued Operations | 25. DISCONTINUED OPERATIONS On August 1, 2015, the Trust finalized and committed to a plan to sell all the hotel properties. As of May 1, 2016, the Trust listed all the Hotel properties with a local real estate hotel broker, and management believes that each of the assets is being marketed at a price that is reasonable in relation to its current fair value. The Trust believes that the plan to sell these assets will not be withdrawn. Through the Trust’s Form 10-Q for the quarter ended October 31, 2016 filed with the SEC on September 14, 2016, the Trust classified all the Hotel properties as Assets Held for Sale. As of October 31, 2016, the Trust has decided to reclassify these assets back into operations as many of these assets have been marketed for sale for more than one year. At this time, the Trust is unable to predict when, and if, any of these Hotel properties will be sold. The Trust continues to list these properties with local real estate hotel brokers, and believes that each of the assets is being marketed at a price that is reasonable in relation to its current fair value. On June 2, 2017, the Ontario Hospitality Properties LLLP was sold to an unrelated third party for $17,500,000 (see Note 24). The Trust has recognized the sale of the Ontario, California hotel into discontinued operations in accordance with ASC No. 205-20, Discontinued Operations Discontinued operations for the fiscal year ended January 31, 2018 and 2017 primarily consists of all hotels operational revenues and expenses for the Ontario, California hotel property and does not include the sale proceeds and profit from the sale of the Ontario, California hotel. The following financial information presents the aggregate carrying amounts of the classes of assets and liabilities of discontinued operations for the years ended January 31, 2018 and 2017, as well as the statements of operations for the years ended January 31, 2018 and 2017. DISCONTINUED OPERATIONS JANUARY 31, 2018 JANUARY 31, 2017 ASSETS Current Assets: Cash and Cash Equivalents $ - $ 89,561 Accounts Receivable - 92,743 Prepaid Expenses and Other Current Assets - 46,823 Total Current Assets of Discontinued Operations - 229,127 Property, Plant and Equipment, net - 6,080,597 TOTAL ASSETS OF DISCONTINUED OPERATIONS $ - $ 6,309,724 LIABILITIES LIABILITIES Current Liabilities: Accounts Payable and Accrued Expenses $ 86,976 $ 400,402 Current Portion of Mortgage Notes Payable - 185,207 Total Current Liabilities of Discontinued Operations 86,976 585,609 Mortgage Notes Payable - 5,047,838 TOTAL LIABILITIES OF DISCONTINUED OPERATIONS $ 86,976 $ 5,633,447 FOR THE YEARS ENDED JANUARY 31, 2018 2017 REVENUE Room $ 1,397,324 $ 3,827,793 Food and Beverage 64,976 164,326 Other 8,443 26,333 TOTAL REVENUE 1,470,743 4,018,452 OPERATING EXPENSES Room 941,691 1,257,499 Food and Beverage 66,152 194,992 Telecommunications - 656 General and Administrative 280,082 457,835 Sales and Marketing 123,300 298,071 Repairs and Maintenance 100,149 290,487 Hospitality 122,227 216,651 Utilities 74,640 245,968 Depreciation 177,824 698,828 Real Estate and Personal Property Taxes, Insurance and Ground Rent 56,015 129,897 Other 6,418 (3,361 ) TOTAL OPERATING EXPENSES 1,948,498 3,787,523 OPERATING LOSS (477,755 ) 230,929 Interest Income 961 - TOTAL OTHER INCOME 961 - Interest on Mortgage Notes Payable 127,787 265,743 Interest on Other Notes Payable 779 4,518 TOTAL INTEREST EXPENSE 128,566 270,261 CONSOLIDATED NET LOSS OF DISCONTINUED OPERATIONS $ (605,360 ) $ (39,332 ) YEARS ENDED JANUARY 31, 2018 2017 NET CASH USED IN OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE $ (406,064 ) $ (2,153 ) NET CASH USED IN INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE $ - $ - |
Stock Options
Stock Options | 12 Months Ended |
Jan. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock Options | 26. STOCK OPTIONS Effective February 5, 2015, the Board of Trustees of the Trust adopted the 2015 Equity Incentive Plan (“2015 Plan”), subject to shareholder approval, under which up to 1,600,000 Shares of Beneficial Interest of the Trust are authorized to be issued pursuant to grant of stock options, stock appreciation rights, restricted shares, restricted share units or other awards. The Board of Trustees of the Trust has decided to terminate the 2015 Plan. Effective October 31, 2016, it has been determined that the Shareholders will not approve the 2015 Plan and the proposed grants have been rescinded. During the 2017 Annual Meeting of Shareholders, the IHT Shareholders approved the InnSuites Hospitality Trust 2017 Equity Incentive Plan (“2017 Plan”). Management has not granted any options under the 2017 Plan. |
Subsequent Events
Subsequent Events | 12 Months Ended |
Jan. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | 27. SUBSEQUENT EVENTS We have evaluated subsequent events through the filing date of this Form 10-K and determined that no subsequent events have occurred that would require recognition in the consolidated financial statements or disclosures in the notes thereto. |
Summary of Significant Accoun34
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Jan. 31, 2018 | |
Accounting Policies [Abstract] | |
Use of Estimates | USE OF ESTIMATES The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Trust’s operations are affected by numerous factors, including the economy, competition in the hotel industry and the effect of the economy on the travel and hospitality industries. The Trust cannot predict if any of the above items will have a significant impact in the future, nor can it predict what impact, if any, the occurrence of these or other events might have on the Trust’s operations and cash flows. Significant estimates and assumptions made by management include, but are not limited to, the estimated useful lives of long-lived assets and recoverability of long-lived assets and the fair values of the long-lived assets. |
Property, Plant and Equipment and Hotel Properties | PROPERTY, PLANT AND EQUIPMENT AND HOTEL PROPERTIES Furniture, fixtures, building improvements and hotel properties are stated at cost and are depreciated using the straight-line method over estimated lives ranging up to 40 years for buildings and 3 to 10 years for furniture and equipment. Management applies guidance ASC 360-10-35, to determine when it is required to test an asset for recoverability of its carrying value and whether an impairment exists. Under ASC 360-10-35, the Trust is required to test a long-lived asset for impairment when there is an indicator of impairment. Impairment indicators may include, but are not limited to, a drop in the performance of a long-lived asset, a decline in the hospitality industry or a decline in the economy. If an indicator of potential impairment is present, then an assessment is performed of whether the carrying amount of an asset exceeds its estimated undiscounted future cash flows over its estimated remaining life. If the estimated undiscounted future cash flows over the asset’s estimated remaining life are greater than the asset’s carrying value, no impairment is recognized; however, if the carrying value of the asset exceeds the estimated undiscounted future cash flows, then the Trust would recognize an impairment expense to the extent the asset’s carrying value exceeds its fair value, if any. The estimated future cash flows are based upon, among other things, assumptions about expected future operating performance, and may differ from actual cash flows. Long-lived assets evaluated for impairment are analyzed on a property-specific basis independent of the cash flows of other groups of assets. Evaluation of future cash flows is based on historical experience and other factors, including certain economic conditions and committed future bookings. Management has determined that impairment of long-lived assets existed during the Trust’s fiscal years ended January 31, 2018 and 2017 (see Note 9). Management applies guidance ASC 350-40 Intangibles – Computer Software Developed or Obtained for Internal Use, to determine whether it should capitalize internal use software developed for our IBC Technologies division. Under ASC 350-40, Management determined that some of the internal-use software can possible be capitalized during the application development stage of development. The application development stage of development includes software configuration, software interfaces and coding. Management has capitalized internally developed software that meets the application development stage of development. Internally developed software is capitalized over the estimated useful life, which ranges from 3-5 years. |
Intangible Assets | INTANGIBLE ASSETS Intangible assets with finite lives were amortized on a straight-line basis over the estimated useful lives, which ranged from 7 to 10 years. The useful life of the intangible asset was evaluated each reporting period to determine whether events and circumstances warrant a revision to the remaining useful life (see Note 9). |
Business Combinations | BUSINESS COMBINATIONS We account for business combinations by recognizing the assets acquired, liabilities assumed, contractual contingencies, and contingent consideration at their fair values on the acquisition date. The final purchase price may be adjusted up to one year from the date of the acquisition. Identifying the fair value of the tangible and intangible assets and liabilities requires the use of estimates by management and was based upon currently available data. The Trust allocates the excess of purchase price over the identifiable intangible and net tangible assets to goodwill. Such goodwill is not deductible for tax purposes and represents the value placed on entering new markets and expanding market share (see Note 9). Unanticipated events and circumstances may occur that may affect the accuracy or validity of such assumptions, estimates or actual results. Additionally, any change in the fair value of the acquisition-related contingent consideration subsequent to the acquisition date, included changes from events after the acquisition date, such as changes in our estimate of relevant revenue or other targets, will be recognized in earnings in the period of the estimated fair value change. A change in fair value of the acquisition-related contingent consideration or the occurrence of events that cause results to differ from our estimates or assumptions could have a material effect on the consolidated statements of operations, financial position and cash flows in the period of the change in the estimate. |
Goodwill | GOODWILL The Trust tests goodwill for impairment annually, or whenever events or changes in circumstances indicate an impairment may have occurred, by comparing its reporting unit’s carrying value to its implied fair value. Impairment may result from, among other things, deterioration in the performance of the acquired business, adverse market conditions, adverse changes in applicable laws or regulations and a variety of other circumstances. If the Trust determines that an impairment has occurred, it is required to record a write-down of the carrying value and charge the impairment as an operating expense in the period the determination is made. In evaluating the recoverability of the carrying value of goodwill, the Trust must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the acquired assets. Changes in strategy or market conditions could significantly impact those judgements in the future and require an adjustment to the recorded balances. The goodwill was recorded as part of the acquisition of International Vacation Hotels that occurred on January 8, 2016 (see Note 9) and an impairment existed as of January 31, 2018. |
Cash and Cash Equivalents | CASH AND CASH EQUIVALENTS The Trust considers all highly liquid short-term investments with maturities of three months or less at the time of purchase to be cash equivalents. The Trust believes it places its cash and cash equivalents only with high credit quality financial institutions, although these balances may periodically exceed federally insured limits. |
Revenue Recognition | REVENUE RECOGNITION Hotel and Operations Staff Accounting Bulletin (“SAB”) No. 104, “Revenue Recognition” summarizes the SEC’s views in applying generally accepted accounting principles to revenue recognition in financial statements. SAB No. 104 establishes the SEC’s view that it is not appropriate to recognize revenue until all of the following criteria are met: persuasive evidence that an arrangement exists; delivery has occurred or services have been rendered; the seller’s price to the buyer is fixed or determinable; and collectability is reasonably assured. Further, SAB No. 104 requires that both title and the risks and rewards of ownership be transferred to the buyer before revenue can be recognized. We believe that our revenue recognition policies as described below are in compliance with SAB No. 104. Revenues are primarily derived from the following sources and are recognized as services are rendered and when collectability is reasonably assured. Amounts received in advance of revenue recognition are considered deferred liabilities. Revenues primarily consist of room rentals, food and beverage sales, management and trademark fees and other miscellaneous revenues from our properties. Revenues are recorded when rooms are occupied and when food and beverage sales are delivered. Management and trademark fees from non-affiliated hotels include a monthly accounting fee and a percentage of hotel room revenues for managing the daily operations of the Hotels and the one hotel owned by affiliates of Mr. Wirth. We are required to collect certain taxes and fees from customers on behalf of government agencies and remit these back to the applicable governmental agencies on a periodic basis. We have a legal obligation to act as a collection agent. We do not retain these taxes and fees and, therefore, they are not included in revenues. We record a liability when the amounts are collected and relieve the liability when payments are made to the applicable taxing authority or other appropriate governmental agency. IBC Technologies Division Our operating results are affected by certain metrics, such as bookings and revenue margin, which we believe are necessary for understanding and evaluating us. Gross bookings represent the total retail value of transactions booked for both agency and merchant transactions, recorded at the time of booking reflecting the total price due for travel by travelers, including taxes, fees and other charges. As travelers have increased their use of the internet to book travel arrangements, we have generally seen our gross bookings increase, reflecting the growth in the online travel industry, our organic market share gains and our business acquisitions. We also evaluate the presentation of revenue on a gross versus a net basis. The consensus of the authoritative accounting literature is that the presentation of revenue as “the gross amount billed to a customer because it has earned revenue from the sale of goods or services or the net amount retained (that is, the amount billed to a customer less the amount paid to a supplier) because it has earned a commission or fee” is a matter of judgment that depends on the relevant facts and circumstances. In making an evaluation of this issue, some of the factors that should be considered are: whether we are the primary obligor in the arrangement (strong indicator); whether we have general supply risk (before customer order is placed or upon customer return) (strong indicator); and whether we have latitude in establishing price. The guidance clearly indicates that the evaluation of these factors, which at times can be contradictory, are subject to significant judgment and subjectivity. If the conclusion drawn is that we perform as an agent or a broker without assuming the risks and rewards of ownership of goods, revenue should be reported on a net basis. For our revenue models, discussed below, we have determined gross presentation is appropriate for certain of revenue transactions and net for others. Based on our initial evaluation of the new revenue recognition standards effective for filing periods after February 1, 2018, the Trust believes that all of our IBC revenues will be presented on a net basis. IVH - Business to Consumer IVH (Business to Consumer) and IBC (Business to Business) are two very different businesses that have two very different customer bases and provide very different services. IVH’s (Business to Consumer) customer is the guest who is staying at the hotel property. Their customer isn’t the hotel that the guest is staying at. The consumer gets to select which hotel and which room type. In some cases IVH prepays for discounted inventory from suppliers and resells it to guests so IVH is holding the supply. IVH plans on potentially doing more of this type of business based on the economics. We provide significant value to the guest by providing a 24/7/365 reservation hotline, travel insurance and support up until the guest reaches the hotel property. We are paid in a variety of ways, sometimes the full value of the reservation is paid to us, of which we remit the hotels portion, sometime just our reservation fee which is equal to a non-refundable deposit made by the guest and sometime by billing the hotel for our reservation fee. Regardless of payment method and mostly depending upon the contractual obligations between IVH and the hotel, IVH typically is forced to pay for no-show reservations. IBC – Business to Business IBC is a leading technology solutions provider to the global travel and tourism industry. IBC’s customer base is the hospitality properties, not the guests who are staying at the properties. The written agreements IBC has is directly with the properties. IBC has significant information risks per their contractual obligations with the hotels. Services include a CRS, Digital Marketing Services, Meta Services, Patent-pending loyalty services, websites and proprietary booking engines. IBC is the primary obligor in the arrangement to provide these services. The hotels look to IBC to fulfill the contractual obligations of the arrangement. IBC is required to pay all upfront costs, regardless of usage and therefore has general inventory risk. IBC sets the price of its contracts and has the latitude to sell our services at various prices to our hotels. IBC changes the product before our network of hotels receive it as we have an entire onboarding team dedicated to ensure the content is uploaded properly, we have a call center and we provide the technology updates as necessary. IBC has sole discretion in selecting our suppliers and the product and service has been designed by IBC. In addition, IBC owns the software that the hotels license the rights to we invoice all of our hotels on monthly basis and records the gross amount of our services as revenues. IBC derives substantially all of our digital marketing revenues from the performance of professional services on a fixed price monthly basis. Our digital marketing services include, but are not limited to, metasearch, retargeting, website design, reputation management, various online business listing services, social media marketing and rate shopping services. We recognize revenues as professional services are performed. A significant component of our digital marketing is search engine marketing (“SEM”). With SEM, we receive a commission on top of the amount of advertising we place for our clients. We incur digital advertising costs on behalf of our clients which are reflected in our advertising and marketing expenses. These expenses include media and production services to place advertisements strategically on various websites to maximize obtaining additional reservations for the hotel. Based on our policy, we recognize revenue when we believe that persuasive evidence of an arrangement exists, delivery has occurred, or services have been rendered, the seller’s price to the buyer is fixed or determinable, and the collectability of our revenues are reasonably assured. |
Accounts Receivables and Allowance for Doubtful Accounts | ACCOUNTS RECEIVABLES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Accounts receivable are carried at original amounts billed less an estimate made for doubtful accounts based on a review of outstanding amounts on a quarterly basis. Management generally records an allowance for doubtful accounts for 50% of balances over 90 days and 100% of balances over 120 days. Accounts receivable are written off when collection efforts have been exhausted and they are deemed uncollectible. Recoveries, if any, of receivables previously written off are recorded when received. The Trust does not charge interest on accounts receivable balances and these receivables are unsecured. The following is a reconciliation of the allowance for doubtful accounts for the fiscal years ending January 31, 2018 and 2017. Fiscal Year Balance at the Beginning of Year Discontinued Operations Adjustment Charged to Expense Deductions Balance at the End of Year 2018 $ 53,720 $ (19,750 ) $ 11,356 $ (73,890 ) $ (28,564 ) 2017 $ 33,970 $ - $ 127,114 $ (107,364 ) $ 53,720 |
Stock-based Compensation | STOCK-BASED COMPENSATION We have an employee equity incentive plan, which is described more fully in Note 22 - “Share-Based Payments.” For fiscal year 2018 and 2017, the Trust has paid the annual fees due to its Trustees by issuing Shares of Beneficial Interest out of its authorized but unissued Shares of Beneficial Interest. Upon issuance, the Trust recognizes the shares as outstanding. The Trust recognizes expense related to the issuance based on the fair value of the shares upon the date of the restricted share grant and amortizes the expense equally over the period during which the shares vest to the Trustees. During fiscal year 2018, the Trust granted restricted stock awards of 24,000 Shares to members of the Board of Trustees, all of which vested in fiscal year 2018 resulting in stock-based compensation of $51,840. During fiscal year 2017, the Trust granted restricted stock awards of 24,000 Shares to members of the Board of Trustees, all of which vested in fiscal year 2017 resulting in stock-based compensation of $55,920. The following table summarizes restricted share activity during fiscal years 2018 and 2017. Restricted Shares Shares Weighted-Average Per Share Grant Date Fair Value Balance at January 31, 2016 - - Granted 24,000 $ 2.16 Vested (24,000 ) $ 2.16 Forfeited - - Balance of unvested awards at January 31, 2017 - - Granted 24,000 $ 2.16 Vested (24,000 ) $ 2.16 Forfeited - - Balance of unvested awards at January 31, 2018 - - |
Treasury Stock | TREASURY STOCK Treasury stock is carried at cost, including any brokerage commissions paid to repurchase the shares. Any shares issued from treasury stock are removed at cost, with the difference between cost and fair value at the time of issuance recorded against Shares of Beneficial Interest. |
Income Taxes | INCOME TAXES The Trust is subject to federal and state corporate income taxes, and accounts for deferred taxes utilizing an asset and liability method whereby deferred tax assets are recognized for deductible temporary differences and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax bases. Deferred tax assets are reduced by a valuation allowance when it is determined to be more likely than not that some portion, or all of the deferred tax assets will not be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment (see Note 17). |
Dividends and Distributions | DIVIDENDS AND DISTRIBUTIONS In fiscal year 2017, the Trust paid a dividend of $0.01 per share in the fourth quarter for $96,630. In fiscal year 2018, the Trust paid a dividend of $0.01 per share at end of the second fiscal quarter and at the end of the fourth fiscal quarter for a total dividend of $0.02 for the fiscal year for $197,512. The Trust’s ability to pay dividends is largely dependent upon the operations of the Hotels. |
Non-controlling Interest | NON-CONTROLLING INTEREST Non-controlling interest in the Trust represents the limited partners’ proportionate share of the capital and earnings of the Partnership. Income or loss is allocated to the non-controlling interest based on a weighted average ownership percentage in the entities throughout the period, and capital is allocated based on the ownership percentage at year-end. Any difference between the weighted average and point-in-time allocations is presented as a reallocation of non-controlling interest as a component of shareholders’ equity. |
Income (Loss) Per Share | INCOME (LOSS) PER SHARE Basic and diluted income (loss) per Share of Beneficial Interest is computed based on the weighted-average number of Shares of Beneficial Interest and potentially dilutive securities outstanding during the period. Dilutive securities are limited to the Class A and Class B units of the Partnership, which are convertible into 3,314,131Shares of the Beneficial Interest, as discussed in Note 1. For the fiscal years ended January 31, 2018 and 2017, there were Class A and Class B Partnership units outstanding, which are convertible into Shares of Beneficial Interest of the Trust. Assuming conversion at the beginning of each period, the aggregate weighted-average of these Shares of Beneficial Interest would have been 3,473,085 in addition to the basic shares outstanding for fiscal years 2018 and 2017, respectively. These Shares of Beneficial Interest issuable upon conversion of the Class A and Class B Partnership units were dilutive during fiscal 2017 and are included in the calculation of diluted earnings per share for that year below. For the Year Ended January 31, 2018 Net Income attributable to controlling interest $ 1,397,601 Plus: Net Income attributable to non-controlling interests 5,410,300 Net Income $ 6,807,901 Weighted average common shares outstanding 9,612,139 Plus: Weighted average incremental shares resulting from unit conversion 3,473,085 Weighted average common shares outstanding after unit conversion 13,085,223 Diluted Income Per Share $ 0.52 |
Segment Reporting | SEGMENT REPORTING The Trust determined that its operations are comprised of two reportable segments, a Hotel Operations & Corporate Overhead segment that has ownership interest in three hotel properties with an aggregate of 424 suites in Arizona and New Mexico, and the IBC Hospitality segment serving 2,000 unrelated hotel properties. The Trust has a concentration of assets in the southwest United States and the southern Arizona market. Historical financial information presented in this Form 10-K reflects this change. On an overall basis, the Trust has elected to only put the costs directly attributable to the IBC Hospitality segment in that segment. Included in these costs are salaries, employee taxes and benefits, sales, marketing and technology development costs. IBC Hotels, LLC was formed during the fiscal year ended January 31, 2014. IBC Hotels, LLC charges a 10% - 20% booking fee which, we believe, increases the independent hotel net profits through lower guest acquisition costs and full guest information for lower lifetime average acquisition cost. Competitors of IBC Hotels can charge anywhere from a 15% to 50% booking fee. InnDependent InnCentives, IBC’s loyalty program, allows hoteliers to benefit from guests who frequently stay at IBC independent hotels. We are actively looking for investors to purchase all or part of IBC Hotels and we are looking to continue to expand IBC Hotels in the future as we concentrate our sales and marketing efforts towards consumers, but can provide no assurance that we will be successful. The Chief Operating Decision Maker (“CODM”), the Trust’s CEO, Mr. Wirth, does not see value in allocating costs for items not directly attributable to the IBC Hospitality segment for several reasons. The first is that the Trust’s base business is the Hotel Operations & Corporate Overhead segment, and the majority of the expenses of the Trust would continue even if the Trust was not in the reservation business. If the Trust were to allocate general expenses to the reservation business based on some allocation method (e.g., on sales), it would not improve the value of segment reporting, but it would only serve to make the results of the Hotel Operations & Corporate Overhead segment look better and give investors an unfounded sense of the profitability of the Hotel Operations & Corporate Overhead segment without the IBC Hospitality segment. The CODM wants to understand the true investment in the reservation business and that result is delivered by allocating only costs directly associated with the IBC Hospitality segment. By retaining the remainder of costs not associated with the IBC Hospitality segment in the Hotel Operations & Corporate Overhead segment, the Trust is able to compare the Hotel Operations & Corporate Overhead segment to historical figures where the bulk of the business was only that segment of operations to gauge relative efficiency of the Hotel Operations & Corporate Overhead segment as compared to historical norms. The Trust has chosen to focus its hotel investments in the southwest region of the United States. The CODM does not review assets by geographical region; therefore, no income statement or balance sheet information by geographical region is provided. |
Advertising Costs | ADVERTISING COSTS Amounts incurred for advertising costs are expensed as incurred. Advertising expense totaled approximately $368,000 and $567,000 for the years ended January 31, 2018 and 2017, respectively. |
Concentration of Credit Risk | CONCENTRATION OF CREDIT RISK Credit risk is the risk of an unexpected loss if a third party to a financial instrument fails to meet its contractual obligations. Financial instruments that potentially subject the Trust to a concentration of credit risk consist primarily of cash and cash equivalents. Management’s assessment of the Trust’s credit risk for cash and cash equivalents is low as cash and cash equivalents are held in financial institutions believed to be credit worthy. The Trust limits its exposure to credit loss by placing its cash with major financial institutions and invests only in short-term obligations. While the Trust is exposed to credit losses due to the non-performance of its counterparties, the Trust considers the risk of this remote. The Trust estimates its maximum credit risk for accounts receivable at the amount recorded on the balance sheet. |
Fair Value of Financial Instruments | FAIR VALUE OF FINANCIAL INSTRUMENTS For disclosure purposes, fair value is determined by using available market information and appropriate valuation methodologies. Fair value is defined as the price that would be received from the sale of an asset or paid to transfer a liability (an exit price) in an orderly transaction between market participants in the principal or most advantageous market for the asset or liability. The fair value framework specifies a hierarchy of valuation techniques, which is based on whether the inputs into the valuation technique are observable or unobservable. The fair value hierarchy levels are as follows: ● Level 1 – Valuation techniques in which all significant inputs are unadjusted quoted prices from active markets for assets or liabilities that are identical to the assets or liabilities being measured. ● Level 2 – Valuation techniques in which significant inputs include quoted prices from active markets for assets or liabilities that are similar to the assets or liabilities being measured and / or quoted prices for assets or liabilities that are identical or similar to the assets or liabilities being measured from markets that are not active. Also, model-derived valuations in which all significant inputs and significant value drivers are observable in active markets are level 2 valuation techniques. ● Level 3 – Valuation techniques in which one or more significant inputs or significant value drivers are unobservable. Unobservable inputs are valuation technique inputs that reflect a company’s own judgments about the assumptions that market participants would use in pricing an asset or liability. The Trust has no assets or liabilities that are carried at fair value on a recurring basis and had no fair value re-measurements during the years ended January 31, 2018 and 2017. Due to their short maturities, the carrying value of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value. The fair value of mortgage notes payable, notes payable to banks and notes and advances payable to related parties is estimated by using the current rates which would be available for similar loans having the same remaining maturities and are based on level 3 inputs. |
Nature of Operations and Basi35
Nature of Operations and Basis of Presentation (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Entity Ownership Percentage | IHT OWNERSHIP % ENTITY DIRECT INDIRECT (i) Albuquerque Suite Hospitality, LLC (see Note 6) 22.83 % - Tucson Hospitality Properties, LLLP - 51.01 % Ontario Hospitality Properties, LLLP (sold in June, 2017) 99.60 % - Yuma Hospitality Properties, LLLP (see Note 6) 12.79 % - Tucson Saint Mary’s Hospitality LLC - 83.66 % RRF Limited Partnership 74.80 % - InnSuites Hotels Inc. 100.00 % - IBC Hotels, LLC (including dba International Vacation Hotels) 99.90 % 0.10 % (i) Indirect ownership is through the Partnership |
Summary of Significant Accoun36
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Accounting Policies [Abstract] | |
Schedule of Accounts Receivable and Allowance for Doubtful Accounts | The following is a reconciliation of the allowance for doubtful accounts for the fiscal years ending January 31, 2018 and 2017. Fiscal Year Balance at the Beginning of Year Discontinued Operations Adjustment Charged to Expense Deductions Balance at the End of Year 2018 $ 53,720 $ (19,750 ) $ 11,356 $ (73,890 ) $ (28,564 ) 2017 $ 33,970 $ - $ 127,114 $ (107,364 ) $ 53,720 |
Schedule of Restricted Share Activity | The following table summarizes restricted share activity during fiscal years 2018 and 2017. Restricted Shares Shares Weighted-Average Per Share Grant Date Fair Value Balance at January 31, 2016 - - Granted 24,000 $ 2.16 Vested (24,000 ) $ 2.16 Forfeited - - Balance of unvested awards at January 31, 2017 - - Granted 24,000 $ 2.16 Vested (24,000 ) $ 2.16 Forfeited - - Balance of unvested awards at January 31, 2018 - - |
Schedule of Diluted Earnings Per Share | For the Year Ended January 31, 2018 Net Income attributable to controlling interest $ 1,397,601 Plus: Net Income attributable to non-controlling interests 5,410,300 Net Income $ 6,807,901 Weighted average common shares outstanding 9,612,139 Plus: Weighted average incremental shares resulting from unit conversion 3,473,085 Weighted average common shares outstanding after unit conversion 13,085,223 Diluted Income Per Share $ 0.52 |
Property, Plant, and Equipmen37
Property, Plant, and Equipment and Hotel Properties (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Plant and Equipment | As of January 31, 2018 and 2017, hotel properties consisted of the following: 2018 2017 (i) Land $ 2,805,015 $ 4,438,079 Building and improvements 18,066,151 25,458,137 Furniture, fixtures and equipment 5,621,820 6,521,257 Total hotel properties 26,492,986 36,417,473 Less accumulated depreciation (12,124,650 ) (17,022,739 ) Hotel Properties in Service, net 14,368,336 19,394,734 Construction in progress 76,683 - Hotel properties, net $ 14,445,019 $ 19,394,734 (i) Includes discontinued operations As of January 31, 2018 and 2017, property, plant and equipment consisted of the following: 2018 2017 Land $ 7,005 $ 7,005 Building and improvements 75,662 75,662 Furniture, fixtures and equipment 1,178,941 852,332 Total property, plant and equipment 1,261,608 934,999 Less accumulated depreciation (694,876 ) (554,868 ) Property, Plant and Equipment, net $ 566,732 $ 380,131 |
Prepaid Expenses and Other Cu38
Prepaid Expenses and Other Current Assets (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Prepaid Expenses and Other Current Assets | Prepaid expenses and other current assets are carried at historic cost and are expected to be consumed within one year. As of January 31, 2018, and 2017, prepaid expenses and other current assets consisted of the following: 2018 2017 Prepaid Assets $ 15,545 $ 48,922 Tax and Insurance Escrow 57,235 58,790 Deposits 8,000 14,805 Prepaid Insurance 7,417 8,130 Prepaid Workman’s Compensation 7,617 43,054 Miscellaneous Prepaid Expenses 17,636 3,953 Total Prepaid Expenses and Current Assets $ 113,450 $ 177,654 |
Intangible Assets, Goodwill a39
Intangible Assets, Goodwill and Impairment (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Fair Value of Assets Acquired | The fair values of assets acquired at the transaction date are summarized below: Marketing Related Intangibles $ 100,000 Customer Base 400,000 Total identifiable intangible assets 500,000 Goodwill 500,000 Total acquired assets $ 1,000,000 |
Schedule of Amortized Intangible Assets | For the fiscal year ending January 31, 2018, intangible assets consisted of the following: Amount Fiscal Year January 31, 2018 Impairment Expense Fiscal year 1/31/2017 Accumulated Amortization Net Amount Useful Lives (years) Marketing Related Intangibles $ 100,000 $ 90,000 $ 10,000 $ - 10 Customer Base 400,000 343,000 57,000 - 7 Total: $ 500,000 $ 433,000 $ 67,000 $ - |
Schedule of Changes in Goodwill | The changes in the carrying value of the Trust’s goodwill for the years ended January 31, 2018 and 2017 is as follows: Beginning Balance January 31, 2016 $ - Acquisition of Vacation Technology Hotels 500,000 Ending Balance January 31, 2017 500,000 Impairment (500,000 ) Ending Balance January 31, 2018 $ - |
Accounts Payable and Accrued 40
Accounts Payable and Accrued Expenses (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Payables and Accruals [Abstract] | |
Schedule of Accounts Payable and Accrued Expenses | As of January 31, 2018 and 2017, accounts payable and accrued expenses consisted of the following: 2018 (i) 2017 Accounts Payable $ 741,917 $ 1,025,749 Accrued Salaries and Wages 271,739 257,259 Accrued Vacation 38,957 32,608 Income Tax Payable 340,169 20,000 Accrued Interest Payable 26,565 52,852 Advanced Customer Deposits 15,000 11,832 Accrued Property Taxes 140,439 190,533 Accrued Land Lease 130,015 98,175 Sales Tax Payable 305,071 163,772 Deferred Revenue 107,467 133,146 Accrued Other 180,813 177,974 Total Accounts Payable and Accrued Expenses $ 2,298,152 $ 2,163,900 (i) Includes current liabilities of discontinued operations. |
Mortgage Notes Payable (Tables)
Mortgage Notes Payable (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Mortgage Notes Payable | The following table summarizes the Trust’s mortgage notes payable, net of debt discounts, as of January 31: 2018 2017 Mortgage note payable, due in monthly installments of $28,493, including interest at 4.69% per year, through June 19, 2042, secured by the Tucson Oracle property with a carrying value of $7.6 million at January 31, 2018. 4,927,076 3,112,112 Mortgage note payable, due in monthly installments of $32,419, including interest at the prime rate plus one percentage point over the index, with a floor of 5.0% per year (5% per year as of January 31, 2015), through August 1, 2022 plus a balloon payment of $4,112,498 in September 2022, secured by the Yuma property with a carrying value of $4.8 million at January 31, 2018. 4,827,259 4,963,645 Totals: $ 9,754,335 $ 8,075,757 |
Minimum Debt Payments (Tables)
Minimum Debt Payments (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Debt Disclosure [Abstract] | |
Scheduled of Minimum Payments of Debt | Scheduled minimum payments of debt, net of debt discounts, as of January 31, 2018 are as follows in the respective fiscal years indicated: FISCAL YEAR MORTGAGES NOTES PAYABLE TO BANK OTHER NOTES PAYABLE TOTAL 2019 $ 254,460 144,185 $ 1,355,664 $ 1,754,309 2020 267,441 21,625 378,817 667,883 2021 278,588 22,868 216,489 517,945 2022 295,336 22,552 3,433 321,321 2023 4,330,880 740,983 - 5,071,863 Thereafter 4,327,630 - - 4,327,630 $ - $ 9,754,335 $ 952,213 $ 1,954,403 $ 12,660,951 |
Federal Income Taxes (Tables)
Federal Income Taxes (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
Schedule of Income Tax Provision | Income taxes for the years ended January 31, 2018 2017 Current income tax provision (benefit) 335,000 (227,000 ) Deferred income tax provision (benefit) - - Net income tax expense (benefit) $ 335,000 $ (227,000 ) |
Schedule of Deferred Tax Assets and Liabilities | Total and net deferred income tax assets at January 31, 2018 2017 Net operating loss carryforwards $ 2,763,000 $ 4,040,000 Bad debt allowance (22,000 ) (18,000 ) Accrued expenses 89,000 84,000 Syndications 5,179,000 5,179,000 Prepaid Insurance 30,000 30,000 Alternative minimum tax credit 91,000 91,000 Total deferred tax assets 8,130,000 9,406,000 Deferred income tax liability associated with book/tax differnces in hotel properties (2,884,000 ) (2,459,000 ) Net deferred income tax asset 5,246,000 6,947,000 Valuation allowance (5,246,000 ) (6,947,000 ) Net deferred income tax $ - $ - |
Schedule of Reconciliation of Differences Between Effective and Statutory Income Tax Rates | A reconciliation of the differences between the effective and statutory income tax rates for years ended January 31, is as follows: Income taxes for the years ended January 31, 2018 2017 Current income tax provision (benefit) 341,000 (227,000 ) Deferred income tax provision (benefit) - - Net income tax expense (benefit) $ 341,000 $ (227,000 ) |
Schedule of Effective Income Tax Rate Reconciliation | A reconciliation of the differences between the effective and statutory income tax rates for years ended January 31, is as follows: 2018 Amount Percent Federal statutory rates $ 1,604,000 34 % State income taxes 636,000 13 % Changes in valuation allowance (1,703,000 ) (36 )% True-up to prior year returns (240,000 ) (5 )% Other 44,000 1 % Effective rate $ 341,000 7 % 2017 Amount Percent Federal statutory rates $ (878,000 ) (34 )% State income taxes (196,000 ) (8 )% Changes in valuation allowance 1,445,000 56 % True-up to prior year returns (593,000 ) (23 )% Other (5,000 ) 0 % Effective rate $ (227,000 ) (9 )% |
Fair Value of Financial Instr44
Fair Value of Financial Instruments (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value Liabilities Measured on Recurring Basis | The following table presents the estimated fair values of the Trust’s debt instruments and the associated carrying value recognized in the accompanying consolidated balance sheets at January 31, 2018 and 2017: 2018 2017 Carrying Amount Fair Value Carrying Amount Fair Value Mortgage notes payable $ 9,752,596 $ 8,164,897 $ 13,367,706 $ 13,473,018 Notes payable to banks $ 952,213 $ 952,213 $ 2,019,758 $ 2,019,758 Other notes payable $ 1,954,405 $ 1,954,405 $ 18,069 $ 18,195 |
Supplemental Cash Flow Disclo45
Supplemental Cash Flow Disclosures (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Supplemental Cash Flow Elements [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | 2018 2017 Cash paid for interest $ 539,072 $ 743,932 Notes Payables - IHT Shares of Beneficial Interest and Partnership Units repurchases $ 1,141,756 $ 7,006 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Future Minimum Lease Payments | Future minimum lease payments under these non-cancelable ground lease and office lease are as follows: Fiscal Year Ending FY 2019 164,184 FY 2020 167,225 FY 2021 170,448 FY 2022 173,864 FY 2023 144,565 Thereafter 5,473,313 Total 6,293,599 |
Share-Based Payments (Tables)
Share-Based Payments (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Equity [Abstract] | |
Summary of Bonus Consisting of Cash and Shares of Beneficial Interest | Fiscal 2017– Short-Term Cash and Equity Bonus Program Executive Officer Cash Equity Pamela J. Barnhill $ 10,000 10,000 Shares of Beneficial Interest Marc E. Berg $ 2,500 2,500 Shares of Beneficial Interest Adam B. Remis $ 5,000 5,000 Shares of Beneficial Interest Fiscal 2017– Full Year Cash and Equity Bonus Program Executive Officer Cash Equity Pamela J. Barnhill $ 25,000 10,000 Shares of Beneficial Interest Marc E. Berg $ 5,000 2,500 Shares of Beneficial Interest Adam B. Remis $ 10,000 5,000 Shares of Beneficial Interest Fiscal 2017– Payouts Under Short-Term and Full Year Cash and Equity Bonus Programs Executive Cash Equity Pamela J. Barnhill $ 5,000 3,000 Shares of Beneficial Interest Marc E. Berg $ 1,000 750 Shares of Beneficial Interest Adam B. Remis $ 2,000 1,500 Shares of Beneficial Interest Fiscal 2018– Short-Term Cash and Equity Bonus Program Executive Cash Equity Pamela J. Barnhill $ 5,000 3,000 Shares of Beneficial Interest Marc E. Berg $ 1,000 750 Shares of Beneficial Interest Adam B. Remis $ 2,000 1,500 Shares of Beneficial Interest Executive Cash Equity Pamela J. Barnhill $ 10,000 4,000 Shares of Beneficial Interest Marc E. Berg $ 2,000 1,000 Shares of Beneficial Interest Adam B. Remis $ 4,000 2,000 Shares of Beneficial Interest Fiscal 2018– Full Year Cash and Equity Bonus Program Executive Cash Equity Pamela J. Barnhill $ 25,000 10,000 Shares of Beneficial Interest Marc E. Berg $ 5,000 2,500 Shares of Beneficial Interest Adam B. Remis $ 10,000 5,000 Shares of Beneficial Interest |
Segment Reporting (Tables)
Segment Reporting (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Segment Reporting [Abstract] | |
Schedule of Reportable Segments | Information relative to the Trust’s reportable segments is as follows: CONSOLIDATED BALANCE SHEET YEAR ENDED JANUARY 31, 2018 Hotel Operations & Corporate Overhead IBC Developments Total Total Assets $ 22,201,935 $ 876,137 $ 23,078,072 Total Liabilities 9,897,562 5,061,541 14,959,103 Fixed Assets, Net 14,586,879 424,872 15,011,751 CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED JANUARY 31, 2018 Hotel Operations & Corporate Overhead IBC Hospitality Total Total Revenue $ 9,319,467 $ 1,448,125 $ 10,767,592 Loss From Continuing Operations (731,888 ) (2,382,919 ) (3,114,807 ) CONSOLIDATED BALANCE SHEET YEAR ENDED JANUARY 31, 2017 Hotel Operations & Corporate Overhead IBC Developments Total Total Assets $ 20,708,359 $ 1,464,473 $ 22,172,832 Total Liabilities 15,280,624 3,266,959 18,547,583 Fixed Assets, Net 13,471,799 222,469 13,694,268 CONSOLIDATED STATEMENT OF OPERATIONS YEAR ENDED JANUARY 31, 2017 Hotel Operations & Corporate Overhead IBC Hospitality Total Total Revenue $ 8,488,387 $ 708,792 $ 9,197,179 Loss From Continuing Operations (1,165,554 ) (1,189,913 ) (2,355,467 ) |
Discontinued Operations (Tables
Discontinued Operations (Tables) | 12 Months Ended |
Jan. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Schedule of Assets and Liabilities of Discontinued Operations | The following financial information presents the aggregate carrying amounts of the classes of assets and liabilities of discontinued operations for the years ended January 31, 2018 and 2017, as well as the statements of operations for the years ended January 31, 2018 and 2017. DISCONTINUED OPERATIONS JANUARY 31, 2018 JANUARY 31, 2017 ASSETS Current Assets: Cash and Cash Equivalents $ - $ 89,561 Accounts Receivable - 92,743 Prepaid Expenses and Other Current Assets - 46,823 Total Current Assets of Discontinued Operations - 229,127 Property, Plant and Equipment, net - 6,080,597 TOTAL ASSETS OF DISCONTINUED OPERATIONS $ - $ 6,309,724 LIABILITIES LIABILITIES Current Liabilities: Accounts Payable and Accrued Expenses $ 86,976 $ 400,402 Current Portion of Mortgage Notes Payable - 185,207 Total Current Liabilities of Discontinued Operations 86,976 585,609 Mortgage Notes Payable - 5,047,838 TOTAL LIABILITIES OF DISCONTINUED OPERATIONS $ 86,976 $ 5,633,447 |
Schedule of Disposal Group Including Discontinued Operation Statements and Cash Flow Statements | FOR THE YEARS ENDED JANUARY 31, 2018 2017 REVENUE Room $ 1,397,324 $ 3,827,793 Food and Beverage 64,976 164,326 Other 8,443 26,333 TOTAL REVENUE 1,470,743 4,018,452 OPERATING EXPENSES Room 941,691 1,257,499 Food and Beverage 66,152 194,992 Telecommunications - 656 General and Administrative 280,082 457,835 Sales and Marketing 123,300 298,071 Repairs and Maintenance 100,149 290,487 Hospitality 122,227 216,651 Utilities 74,640 245,968 Depreciation 177,824 698,828 Real Estate and Personal Property Taxes, Insurance and Ground Rent 56,015 129,897 Other 6,418 (3,361 ) TOTAL OPERATING EXPENSES 1,948,498 3,787,523 OPERATING LOSS (477,755 ) 230,929 Interest Income 961 - TOTAL OTHER INCOME 961 - Interest on Mortgage Notes Payable 127,787 265,743 Interest on Other Notes Payable 779 4,518 TOTAL INTEREST EXPENSE 128,566 270,261 CONSOLIDATED NET LOSS OF DISCONTINUED OPERATIONS $ (605,360 ) $ (39,332 ) YEARS ENDED JANUARY 31, 2018 2017 NET CASH USED IN OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE $ (406,064 ) $ (2,153 ) NET CASH USED IN INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE $ - $ - |
Nature of Operations and Basi50
Nature of Operations and Basis of Presentation (Details Narrative) | Jun. 02, 2017USD ($) | Jan. 31, 2018USD ($)Integershares | Jan. 31, 2018USD ($)Integershares | Jan. 31, 2017shares | Apr. 18, 2018USD ($) |
Number of hotels | Integer | 3 | ||||
Number of suites | Integer | 424 | ||||
Sale of stock transaction value | $ 400,000 | ||||
Debt instrument interest rate | 7.00% | 7.00% | 7.00% | ||
Reservation acquisition costs | $ 234,000 | ||||
Trust [Member] | |||||
Line of credit amount | $ 811,000 | $ 811,000 | $ 811,000 | ||
Debt instrument interest rate | 7.00% | 7.00% | |||
Line of credit limit | $ 1,000,000 | $ 1,000,000 | |||
Amount receivable | 830,000 | 830,000 | |||
Cash and cash equivalents | 5,775,000 | 5,775,000 | |||
Advances to affiliates | 1,000,000 | 1,000,000 | |||
Line of credit availability combined | 1,000,000 | $ 1,000,000 | |||
General Partner Units [Member] | |||||
Partnership ownership interest percentage | 74.80% | 72.11% | |||
Advances to Affiliate [Member] | Trust [Member] | |||||
Line of credit amount | 971,000 | $ 971,000 | |||
Line of credit limit | $ 1,000,000 | $ 1,000,000 | |||
Class A Partnership Units [Member] | |||||
Partnership unit issued | shares | 250,093 | 250,093 | 276,131 | ||
Partnership unit outstanding | shares | 250,093 | 250,093 | 276,131 | ||
Percentage of total partnership units | 1.95% | 2.09% | |||
Class B Partnership Units [Member] | James Wirth [Member] | |||||
Partnership unit outstanding | shares | 2,974,038 | 2,974,038 | 3,407,938 | ||
InnSuites Hotel Located in Yuma, Arizona [Member] | |||||
Percentage of ownership interest held by the trust | 12.79% | ||||
Innsuites Hotel Located in Albuquerque New Mexico [Member] | |||||
Percentage of ownership interest held by the trust | 22.83% | ||||
Partnership ownership interest percentage | 22.83% | ||||
RRF Limited Partnership [Member] | Innsuites Hotel Located In Tucson Arizona [Member] | |||||
Partnership ownership interest percentage | 51.01% | ||||
RRF Limited Partnership [Member] | Weighted Average [Member] | |||||
Percentage of ownership interest held by the trust | 72.53% | 72.11% | |||
Ontario Hospitality Properties LLLP [Member] | |||||
Sale of stock transaction value | $ 17,500,000 | ||||
IBC Hotels [Member] | |||||
Number of real estate properties | Integer | 2,000 | 2,000 | |||
Proprietary booking engine | $ 1,100,000 | $ 1,100,000 | |||
General Partner [Member] | |||||
Partnership ownership interest percentage | 74.80% | 72.11% | |||
Number of partnership units | shares | 9,527,448 | 9,527,448 | 9,527,448 | ||
General Partner [Member] | RRF Limited Partnership [Member] | |||||
Number of hotels | Integer | 3 | ||||
Number of suites | Integer | 424 | ||||
Percentage of ownership interest held by the trust | 74.19% | 72.11% | |||
Limited Partner [Member] | |||||
Number of partnership units | shares | 3,314,131 | 3,314,131 | |||
Shares of Beneficial Interest Trust [Member] | |||||
Number of partnership units | shares | 3,684,069 |
Nature of Operations and Basi51
Nature of Operations and Basis of Presentation - Schedule of Entity Ownership Percentage (Details) | Jan. 31, 2018 | |
Albuquerque Suite Hospitality, LLC [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 22.83% | |
Albuquerque Suite Hospitality, LLC [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 0.00% | [1] |
Tucson Hospitality Properties LLLP [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 0.00% | |
Tucson Hospitality Properties LLLP [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 51.01% | [1] |
Ontario Hospitality Properties LLLP [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 99.60% | |
Ontario Hospitality Properties LLLP [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 0.00% | [1] |
Yuma Hospitality Properties, LLLP [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 12.79% | |
Yuma Hospitality Properties, LLLP [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 0.00% | [1] |
Tucson Saint Mary's Suite Hospitality LLC [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 0.00% | |
Tucson Saint Mary's Suite Hospitality LLC [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 83.66% | [1] |
RRF Limited Partnership [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 74.80% | |
RRF Limited Partnership [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 0.00% | [1] |
InnSuites Hotels Inc. [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 100.00% | |
InnSuites Hotels Inc. [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 0.00% | [1] |
IBC Hotels, LLC [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 99.90% | |
IBC Hotels, LLC [Member] | Indirect Ownership [Member] | ||
IHT OWNERSHIP % | 0.10% | [1] |
[1] | Indirect ownership is through the Partnership |
Summary of Significant Accoun52
Summary of Significant Accounting Policies (Details Narrative) | 3 Months Ended | 12 Months Ended | ||||
Jan. 31, 2018USD ($)Integer$ / shares | Jul. 31, 2017$ / shares | Jan. 31, 2017USD ($)$ / shares | Jan. 31, 2018USD ($)Integershares | Jan. 31, 2017USD ($)shares | Jan. 31, 2014 | |
Share-based compensation arrangement by share-based payment award, equity instruments other than options, grants in period | shares | 24,000 | 24,000 | ||||
Share-based compensation | $ | $ 51,840 | $ 55,920 | ||||
Common stock, dividends, per share, cash paid | $ / shares | $ 0.02 | $ 0.01 | $ 0.01 | |||
Dividends, common stock, cash | $ | $ 197,512 | $ 96,630 | ||||
Aggregate weighted average shares of beneficial for units of partnership | $ | $ 3,314,131 | |||||
Weighted average incremental shares resulting from unit conversion | shares | 3,473,085 | 3,473,085 | ||||
Number of reportable segments | Integer | 2 | |||||
Number of hotels | Integer | 3 | |||||
Number of suites | Integer | 424 | |||||
Advertising expense | $ | $ 368,000 | $ 567,000 | ||||
IBC Hotels [Member] | ||||||
Number of real estate properties | Integer | 2,000 | 2,000 | ||||
90 days [Member] | ||||||
Percentage of allowance for doubtful accounts | 50.00% | |||||
120 days [Member] | ||||||
Percentage of allowance for doubtful accounts | 100.00% | |||||
Maximum [Member] | ||||||
Finite lives are amortized on straight-line estimated useful lives | 10 years | |||||
Maximum [Member] | IBC Hotels [Member] | ||||||
Percentage of booking fee | 20.00% | |||||
Maximum [Member] | Competitors of IBC Hotels [Member] | ||||||
Percentage of booking fee | 50.00% | |||||
Minimum [Member] | ||||||
Finite lives are amortized on straight-line estimated useful lives | 7 years | |||||
Minimum [Member] | IBC Hotels [Member] | ||||||
Percentage of booking fee | 10.00% | |||||
Minimum [Member] | Competitors of IBC Hotels [Member] | ||||||
Percentage of booking fee | 15.00% | |||||
Building and Improvements [Member] | Maximum [Member] | ||||||
Property, plant and equipment, useful life | 40 years | |||||
Furniture and Equipment [Member] | Maximum [Member] | ||||||
Property, plant and equipment, useful life | 10 years | |||||
Furniture and Equipment [Member] | Minimum [Member] | ||||||
Property, plant and equipment, useful life | 3 years | |||||
DevelopedtSoftwareMember [Member] | Maximum [Member] | ||||||
Property, plant and equipment, useful life | 5 years | |||||
DevelopedtSoftwareMember [Member] | Minimum [Member] | ||||||
Property, plant and equipment, useful life | 3 years |
Summary of Significant Accoun53
Summary of Significant Accounting Policies - Schedule of Accounts Receivable and Allowance for Doubtful Accounts (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Accounting Policies [Abstract] | ||
Beginning Balance | $ 53,720 | $ 3,970 |
Discontinued Operations Adjustment | (19,750) | |
Charged to Expense | 11,356 | 127,114 |
Deductions | (73,890) | (107,364) |
Ending Balance | $ (28,564) | $ 53,720 |
Summary of Significant Accoun54
Summary of Significant Accounting Policies - Schedule of Restricted Share Activity (Details) - $ / shares | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Restricted Shares, Granted | 24,000 | 24,000 |
Restricted Stock [Member] | ||
Restricted Shares Balance of unvested awards Beginning | ||
Restricted Shares, Granted | 24,000 | 24,000 |
Restricted Shares, Vested | (24,000) | (24,000) |
Restricted Shares, Forfeited | ||
Restricted Shares Balance of unvested awards Ending | ||
Weighted-Average Per Share Grant Date Fair Value Balance of unvested awards Beginning | ||
Weighted-Average Per Share Grant Date Fair Value Granted | 2.16 | 2.16 |
Weighted-Average Per Share Grant Date Fair Value Vested | 2.16 | 2.16 |
Weighted-Average Per Share Grant Date Fair Value Forfeited | ||
Weighted-Average Per Share Grant Date Fair Value Balance of unvested awards Ending |
Summary of Significant Accoun55
Summary of Significant Accounting Policies - Schedule of Diluted Earnings Per Share (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Accounting Policies [Abstract] | ||
Net Income attributable to controlling interest | $ 1,397,601 | $ (2,191,972) |
Plus: Net Loss attributable to non-controlling interests | 5,410,300 | (434,782) |
Net Income | $ 6,807,901 | $ (2,626,754) |
Weighted average common shares outstanding | 9,612,139 | |
Plus: Weighted average incremental shares resulting from unit conversion | 3,473,085 | 3,473,085 |
Weighted average common shares outstanding after unit conversion | 13,085,223 | 13,366,737 |
Diluted Income Per Share | $ 0.52 | $ (0.19) |
Sale of Ownership Interests i56
Sale of Ownership Interests in Albuquerque Subsidiary (Details Narrative) - USD ($) | Jul. 19, 2017 | Feb. 15, 2017 | Jul. 22, 2010 | Jan. 31, 2010 | Sep. 15, 2009 | Jan. 05, 2009 | Sep. 10, 2007 | Aug. 18, 2005 | Sep. 10, 2002 | Jan. 02, 2001 | Jan. 31, 2018 | Dec. 31, 2013 | Dec. 31, 2015 | Dec. 09, 2013 |
Number of units were available for sale | 750,000 | 350,000 | 250,000 | 300,000 | 350,000 | 350,000 | 350,000 | 250,000 | ||||||
Class A [Member] | ||||||||||||||
Number of units sold during period | 250 | |||||||||||||
Class B [Member] | ||||||||||||||
Number of units sold during period | 200 | |||||||||||||
Class A, Class B and Class C [Member] | ||||||||||||||
Sale price per unit | $ 10,000 | |||||||||||||
Limited liability limited partnership interests | 800 | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | ||||||||||||||
Number of units were available for sale | 10,000 | |||||||||||||
Rare Earth Financial, LLC [Member] | Class A [Member] | ||||||||||||||
Number of units were available for sale | 300 | |||||||||||||
Albuquerque [Member] | Class A, Class B and Class C [Member] | Minimum [Member] | ||||||||||||||
Limited liability limited partnership interests | 550 | |||||||||||||
Albuquerque [Member] | Class A, Class B and Class C [Member] | Maximum [Member] | ||||||||||||||
Limited liability limited partnership interests | 600 | |||||||||||||
Restructuring Agreement [Member] | ||||||||||||||
Restructuring fee | $ 240,000 | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | ||||||||||||||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 49.00% | |||||||||||||
Number of units were available for sale | 400 | |||||||||||||
Sale price per unit | $ 10,000 | $ 10,000 | $ 10,000 | |||||||||||
Maximum investors to purchase units | 150 | |||||||||||||
Maximum potentially to overallotment exercised | 190 | |||||||||||||
Percentage of hold least outstanding units | 50.10% | |||||||||||||
Return percentage | 7.00% | |||||||||||||
Restructuring fee | $ 128,000 | |||||||||||||
Number of units sold during period | 142 | 100 | ||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Unrelated Unit Holders [Member] | ||||||||||||||
Priority return payments | $ 209,000 | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Trust [Member] | ||||||||||||||
Priority return payments | $ 177,000 | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Class A Limited Partnership Units [Member] | ||||||||||||||
Number of units sold during period | 193 | |||||||||||||
Percentage of trust held ownership interest | 22.83% | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Class A Limited Partnership Units [Member] | Other Parties [Member] | ||||||||||||||
Number of units sold during period | 462 | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Class A Limited Partnership Units [Member] | Other Parties [Member] | ||||||||||||||
Percentage of trust held ownership interest | 77.00% | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Class B Limited Partnership Units [Member] | ||||||||||||||
Number of units sold during period | 137 | |||||||||||||
Percentage of trust held ownership interest | 0.17% | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Class C Limited Partnership Units [Member] | ||||||||||||||
Number of units sold during period | 1 | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Unit Class [Member] | ||||||||||||||
Return percentage | 50.00% | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Rare Earth Financial, LLC [Member] | ||||||||||||||
Return percentage | 50.00% | |||||||||||||
Albuquerque Suite Hospitality, LLC [Member] | Restructuring Agreement [Member] | ||||||||||||||
Cumulative priority distributions per unit per year | $ 700 | |||||||||||||
Rare Earth [Member] | ||||||||||||||
Restructuring fee | $ 200,000 |
Sale of Ownership Interests i57
Sale of Ownership Interests in Tucson Hospitality Properties Subsidiary (Details Narrative) - USD ($) | Jul. 19, 2017 | Oct. 01, 2013 | Feb. 17, 2011 | Jan. 31, 2010 | Sep. 15, 2009 | Jan. 05, 2009 | Sep. 10, 2007 | Aug. 18, 2005 | Sep. 10, 2002 | Jan. 02, 2001 | Jan. 31, 2018 | Jun. 30, 2016 |
Number of units were available for sale | 750,000 | 350,000 | 250,000 | 300,000 | 350,000 | 350,000 | 350,000 | 250,000 | ||||
Tucson Hospitality Properties LP [Member] | ||||||||||||
Number of units were available for sale | 250 | |||||||||||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 41.00% | |||||||||||
Return percentage | 7.00% | |||||||||||
Tucson Hospitality Properties LP [Member] | Unrelated Unitsholders [Member] | ||||||||||||
Priority return payments | $ 272,000 | |||||||||||
Tucson Hospitality Properties LP [Member] | Partnership [Member] | ||||||||||||
Priority return payments | $ 283,000 | |||||||||||
Tucson Hospitality Properties LP [Member] | Class B Limited Partnership Units [Member] | ||||||||||||
Number of units sold during period | 404 | |||||||||||
Percentage of trust held ownership interest | 51.01% | |||||||||||
Tucson Hospitality Properties LP [Member] | Class B Limited Partnership Units [Member] | Mr. Wirth and Affiliates [Member] | ||||||||||||
Percentage of trust held ownership interest | 0.38% | |||||||||||
Tucson Hospitality Properties LP [Member] | Class C Limited Partnership Units [Member] | ||||||||||||
Number of units sold during period | 3 | |||||||||||
Tucson Hospitality Properties LP [Member] | Class C Limited Partnership Units [Member] | Other Parties Holders [Member] | ||||||||||||
Number of units sold during period | 385 | |||||||||||
Percentage of trust held ownership interest | 48.61% | |||||||||||
Tucson Hospitality Properties LP [Member] | Unit Class [Member] | ||||||||||||
Return percentage | 50.00% | |||||||||||
Restructuring fee | $ 128,000 | |||||||||||
Tucson Hospitality Properties LP [Member] | Rare Earth Financial, LLC [Member] | ||||||||||||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 50.10% | |||||||||||
Sale price per unit | $ 10,000 | |||||||||||
Maximum investors to purchase units | 160 | |||||||||||
Maximum potentially to overallotment exercised | 200 | |||||||||||
Cumulative priority distributions per unit per year | $ 700 | |||||||||||
Return percentage | 50.00% | |||||||||||
Number of units sold during period | 100 | |||||||||||
Tucson Hospitality Properties LP [Member] | Rare Earth Financial, LLC [Member] | Class A Limited Partnership Units [Member] | ||||||||||||
Number of units sold during period |
Sale of Ownership Interests i58
Sale of Ownership Interests in Yuma Hospitality Properties Subsidiary (Details Narrative) - USD ($) | Jul. 19, 2017 | Feb. 15, 2017 | Oct. 24, 2014 | Jan. 31, 2010 | Sep. 15, 2009 | Jan. 05, 2009 | Sep. 10, 2007 | Aug. 18, 2005 | Sep. 10, 2002 | Jan. 02, 2001 | Jan. 31, 2018 | Jan. 31, 2016 | Jan. 31, 2017 |
Number of units were available for sale | 750,000 | 350,000 | 250,000 | 300,000 | 350,000 | 350,000 | 350,000 | 250,000 | |||||
Restructuring Agreement [Member] | |||||||||||||
Restructuring fee | $ 240,000 | ||||||||||||
Class A, Class B and Class C [Member] | |||||||||||||
Sale price per unit | $ 10,000 | ||||||||||||
Limited liability limited partnership interests | 800 | ||||||||||||
IHT Class B [Member] | |||||||||||||
Number of units were available for sale | 300 | ||||||||||||
Class A [Member] | Accredited Investors [Member] | |||||||||||||
Number of units were available for sale | 300 | ||||||||||||
Rare Earth Financial, LLC [Member] | Class A [Member] | |||||||||||||
Number of units were available for sale | 300 | ||||||||||||
Yuma Hospitality Properties LP [Member] | |||||||||||||
Sale price per unit | $ 10,000 | ||||||||||||
Number of units were available for sale | 750 | ||||||||||||
Number of additional units were available for sale | 50 | ||||||||||||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 49.00% | ||||||||||||
Priority unit distributions | 700 | ||||||||||||
Return percentage | 7.00% | ||||||||||||
Restructuring fee | $ 350,000 | ||||||||||||
Yuma Hospitality Properties LP [Member] | Trust [Member] | |||||||||||||
Priority return payments | $ 231,000 | ||||||||||||
Yuma Hospitality Properties LP [Member] | Class A Limited Partnership Units [Member] | |||||||||||||
Number of units were available for sale | 298.70 | ||||||||||||
Yuma Hospitality Properties LP [Member] | Class A Limited Partnership Units [Member] | Other Related Parties [Member] | |||||||||||||
Number of units were available for sale | 692.70 | ||||||||||||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 86.59% | ||||||||||||
Yuma Hospitality Properties LP [Member] | Class A Limited Partnership Units [Member] | Partnership [Member] | |||||||||||||
Sale price per unit | $ 10,000 | ||||||||||||
Yuma Hospitality Properties LP [Member] | Class B Limited Partnership Units [Member] | |||||||||||||
Number of units were available for sale | 102.30 | ||||||||||||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 12.79% | ||||||||||||
Yuma Hospitality Properties LP [Member] | Class C Limited Partnership Units [Member] | Mr. Wirth and his Affiliates [Member] | |||||||||||||
Number of units were available for sale | 5 | ||||||||||||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 0.63% | ||||||||||||
Yuma Hospitality Properties LP [Member] | Unit Class [Member] | |||||||||||||
Return percentage | 50.00% | ||||||||||||
Yuma Hospitality Properties LP [Member] | Rare Earth Financial, LLC [Member] | |||||||||||||
Number of units were available for sale | 150 | ||||||||||||
Maximum investors to purchase units | 398 | ||||||||||||
Return percentage | 50.00% | ||||||||||||
Restructuring fee | $ 350,000 | ||||||||||||
Priority return payments | $ 360,500 |
Property, Plant, and Equipmen59
Property, Plant, and Equipment and Hotel Properties - Schedule of Property, Plant and Equipment (Details) - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 | |
Property, Plant and Equipment, net | $ 15,011,751 | $ 13,694,268 | |
Hotel Properties [Member] | |||
Total property, plant and equipment | 26,492,986 | 36,417,473 | [1] |
Less accumulated depreciation | (12,124,650) | (17,022,739) | [1] |
Property, Plant and Equipment, net | 14,445,019 | 19,394,734 | [1] |
Hotel Properties [Member] | Land [Member] | |||
Total property, plant and equipment | 2,805,015 | 4,438,079 | [1] |
Hotel Properties [Member] | Building and Improvements [Member] | |||
Total property, plant and equipment | 18,066,151 | 25,458,137 | [1] |
Hotel Properties [Member] | Furniture, Fixtures and Equipment [Member] | |||
Total property, plant and equipment | 5,621,820 | 6,521,257 | [1] |
Hotel Properties [Member] | Hotel Properties in Service [Member] | |||
Property, Plant and Equipment, net | 14,368,336 | 19,394,734 | [1] |
Hotel Properties [Member] | Construction in Progress [Member] | |||
Property, Plant and Equipment, net | 76,683 | [1] | |
Property, Plant and Equipment [Member] | |||
Total property, plant and equipment | 1,261,608 | 934,999 | |
Less accumulated depreciation | (694,876) | (554,868) | |
Property, Plant and Equipment, net | 566,732 | 380,131 | |
Property, Plant and Equipment [Member] | Land [Member] | |||
Total property, plant and equipment | 7,005 | 7,005 | |
Property, Plant and Equipment [Member] | Building and Improvements [Member] | |||
Total property, plant and equipment | 75,662 | 75,662 | |
Property, Plant and Equipment [Member] | Furniture, Fixtures and Equipment [Member] | |||
Total property, plant and equipment | $ 1,178,941 | $ 852,332 | |
[1] | Includes discontinued operations |
Prepaid Expenses and Other Cu60
Prepaid Expenses and Other Current Assets - Schedule of Prepaid Expenses and Other Current Assets (Details) - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | ||
Prepaid Assets | $ 15,545 | $ 48,922 |
Tax and Insurance Escrow | 57,235 | 58,790 |
Deposits | 8,000 | 14,805 |
Prepaid Insurance | 7,417 | 8,130 |
Prepaid Workman's Compensation | 7,617 | 43,054 |
Miscellaneous Prepaid Expenses | 17,636 | 3,953 |
Total Prepaid Expenses and Current Assets | $ 113,450 | $ 177,654 |
Intangible Assets, Goodwill a61
Intangible Assets, Goodwill and Impairment (Details Narrative) - USD ($) | 12 Months Ended | |||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | Jan. 08, 2016 | |
Purchase of international vacation hotels | $ 1,000,000 | |||
Amortization expense of goodwill | $ 67,000 | |||
International Vacation Hotels [Member] | ||||
Purchase of international vacation hotels | $ 1,000,000 | |||
International Vacation Hotels [Member] | IBC Hotels [Member] | ||||
Net operating loss | $ 1,600,000 | $ 1,000,000 |
Intangible Assets, Goodwill a62
Intangible Assets, Goodwill and Impairment - Schedule of Fair Value of Assets Acquired (Details) - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2016 | Jan. 08, 2016 |
Total identifiable intangible assets | $ 500,000 | |||
Goodwill | $ 500,000 | 500,000 | ||
Total acquired assets | 1,000,000 | |||
Marketing Related Intangibles [Member] | ||||
Total identifiable intangible assets | 100,000 | |||
Customer Base [Member] | ||||
Total identifiable intangible assets | $ 400,000 |
Intangible Assets, Goodwill a63
Intangible Assets, Goodwill and Impairment - Schedule of Amortized Intangible Assets (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Amount | $ 500,000 | |
Impairment Expense | $ 67,000 | |
Accumulated Amortization | 433,000 | |
Net Amount | ||
Marketing Related Intangibles [Member] | ||
Amount | 100,000 | |
Impairment Expense | 10,000 | |
Accumulated Amortization | 90,000 | |
Net Amount | ||
Useful Lives (years) | 10 years | |
Customer Base [Member] | ||
Amount | $ 400,000 | |
Impairment Expense | $ 57,000 | |
Accumulated Amortization | 343,000 | |
Net Amount | ||
Useful Lives (years) | 7 years |
Intangible Assets, Goodwill a64
Intangible Assets, Goodwill and Impairment - Schedule of changes in Goodwill (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | ||
Beginning Balance | $ 500,000 | |
Acquisition of Vacation Technology Hotels | 500,000 | |
Impairment | (500,000) | |
Ending Balance | $ 500,000 |
Accounts Payable and Accrued 65
Accounts Payable and Accrued Expenses - Schedule of Accounts Payable and Accrued Expenses (Details) - USD ($) | Jan. 31, 2018 | [1] | Jan. 31, 2017 |
Payables and Accruals [Abstract] | |||
Accounts Payable | $ 741,917 | $ 1,025,749 | |
Accrued Salaries and Wages | 271,739 | 257,259 | |
Accrued Vacation | 38,957 | 32,608 | |
Income Tax Payable | 340,169 | 20,000 | |
Accrued Interest Payable | 26,565 | 52,852 | |
Advanced Customer Deposits | 15,000 | 11,832 | |
Accrued Property Taxes | 140,439 | 190,533 | |
Accrued Land Lease | 130,015 | 98,175 | |
Sales Tax Payable | 305,071 | 163,772 | |
Deferred Revenue | 107,467 | 133,146 | |
Accrued Other | 180,813 | 177,974 | |
Total Accounts Payable and Accrued Expenses | $ 2,298,152 | $ 2,163,900 | |
[1] | Includes current liabilities of discontinued operations. |
Mortgage Notes Payable (Details
Mortgage Notes Payable (Details Narrative) - USD ($) | Jun. 29, 2017 | Nov. 24, 2014 | Aug. 24, 2012 | Jan. 31, 2018 | Jan. 31, 2017 |
Debt instrument maturity description | The mortgage notes payable have various repayment terms and have scheduled maturity dates ranging from August 2022 to June 2042. | ||||
Mortgage notes payable interest rate | 4.85% | 4.65% | |||
Mortgage loan face amount | $ 4,927,000 | ||||
Debt instrument interest rate | 7.00% | 7.00% | |||
Debt instrument discount | $ 6,000 | ||||
Business Loan Agreement [Member] | |||||
Mortgage loan face amount | 4,927,000 | ||||
Debt instrument discount | 5,000 | ||||
Mortgage facility amount | $ 5,000,000 | ||||
Refinancing mortgage facility amount | $ 3,045,000 | ||||
Debt instrument maturity date | Jun. 19, 2042 | ||||
Business Loan Agreement [Member] | First Five Year and Thereafter [Member] | |||||
Debt instrument interest rate | 4.69% | ||||
Business Loan Agreement [Member] | Prime Rate [Member] | |||||
Debt instrument interest rate | 2.00% | ||||
Business Loan Agreement [Member] | Interest Floor Rate [Member] | |||||
Debt instrument interest rate | 4.69% | ||||
First Bank [Member] | |||||
Mortgage loan face amount | $ 5,500,000 | ||||
Debt instrument maturity period | 10 years | ||||
Debt instrument interest rate | 5.00% | ||||
Debt outstanding | 4,828,000 | ||||
Debt instrument discount | $ 11,000 | ||||
Kansas State Bank of Manhattan [Member] | |||||
Mortgage loan face amount | $ 3,500,000 | ||||
Debt instrument maturity period | 15 years | ||||
Debt instrument interest rate | 4.19% | ||||
Kansas State Bank of Manhattan [Member] | Maximum [Member] | |||||
Debt instrument interest rate | 8.00% | ||||
Kansas State Bank of Manhattan [Member] | Minimum [Member] | |||||
Debt instrument interest rate | 4.19% |
Mortgage Notes Payable - Schedu
Mortgage Notes Payable - Schedule of Mortgage Notes Payable (Details) - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 |
Mortgage note payable | $ 9,754,335 | $ 8,075,757 |
Tucson Oracle Property [Member] | ||
Mortgage note payable | 4,927,076 | 3,112,112 |
Yuma Hospitality Properties LP [Member] | ||
Mortgage note payable | $ 4,827,259 | $ 4,963,645 |
Mortgage Notes Payable - Sche68
Mortgage Notes Payable - Schedule of Mortgage Notes Payable (Details) (Parenthetical) - USD ($) | 12 Months Ended | ||
Jan. 31, 2018 | Jan. 31, 2017 | Jan. 31, 2015 | |
Mortgage note payable, interest rate | 7.00% | 7.00% | |
Tucson Oracle Property [Member] | |||
Mortgage note payable, monthly payments | $ 28,493 | $ 28,493 | |
Mortgage note payable, interest rate | 4.69% | 4.69% | |
Mortgage note payable, carrying value of secured property | $ 7,600,000 | $ 7,600,000 | |
Yuma Hospitality Properties LP [Member] | |||
Mortgage note payable, monthly payments | $ 32,419 | $ 32,419 | |
Mortgage note payable, interest rate | 5.00% | 5.00% | 5.00% |
Mortgage note payable, balloon payment | $ 4,112,498 | $ 4,112,498 | |
Mortgage note payable, carrying value of secured property | $ 4,800,000 | $ 4,800,000 |
Notes Payable to Banks (Details
Notes Payable to Banks (Details Narrative) - USD ($) | May 11, 2017 | Jan. 08, 2016 | Jan. 31, 2018 | May 03, 2016 |
Business loan balance | $ 828,000 | |||
Debt discount | 6,000 | |||
International Vacation Hotels [Member] | ||||
Proceeds from business loans | $ 400,000 | |||
Debt instrument, maturity date | Feb. 1, 2019 | |||
Line of credit bear interest rate | 8.00% | |||
Promissory Note Agreement [Member] | ||||
Proceeds from business loans | $ 850,000 | |||
Debt instrument, maturity date | Sep. 1, 2022 | |||
Line of credit bear interest rate | 5.50% | |||
Promissory Note Agreement [Member] | Prime Rate [Member] | ||||
Line of credit bear interest rate | 1.50% | |||
Promissory Note Agreement [Member] | Interest Floor Rate [Member] | ||||
Line of credit bear interest rate | 5.50% | |||
Laurence Holdings Limited [Member] | International Vacation Hotels [Member] | ||||
Business loan balance | 124,000 | |||
Debt discount | $ 2,000 | |||
Trust and Yuma Hospitality Properties Limited Partnership [Member] | RepublicBank AZ Agreement [Member] | ||||
Line of credit limit | $ 350,000 |
Line of Credit - Related Party
Line of Credit - Related Party (Details Narrative) - USD ($) | Dec. 01, 2014 | Jan. 31, 2018 | Jan. 31, 2017 |
Note receivable - related party | $ 810,799 | ||
Notes payable, related parties | 296,315 | 145,000 | |
Rare Earth [Member] | |||
Line of credit increased maximum borrowing capacity | $ 1,000,000 | 1,000,000 | |
Line of credit interest rate | 7.00% | ||
Line of credit maturity date | Dec. 31, 2018 | ||
Line of credit | 630,000 | ||
Interest expense, related party | 4,768 | $ 5,112 | |
Related party revenue | $ 15,567 |
Other Notes Payable (Details Na
Other Notes Payable (Details Narrative) - USD ($) | May 20, 2017 | Jun. 20, 2016 | Jan. 31, 2018 | Jan. 31, 2017 | Jul. 18, 2017 | May 30, 2017 | Mar. 20, 2017 | Mar. 01, 2017 | Dec. 05, 2016 |
Notes payable outstanding to unrelated third parties | $ 959,000 | $ 18,000 | |||||||
Stock repurchased during period, shares | 524,930 | 3,259 | |||||||
Debt instrument interest rate | 7.00% | 7.00% | |||||||
Debt principal amounts | $ 4,927,000 | ||||||||
Eight Unsecured Loans [Member] | |||||||||
Unsecured loan | $ 425,000 | ||||||||
Two Unsecured Loans [Member] | |||||||||
Unsecured loan | 25,000 | ||||||||
Hayden Loan [Member] | |||||||||
Debt instrument interest rate | 7.00% | ||||||||
Unsecured loan | $ 80,000 | $ 90,000 | $ 63,040 | $ 36,960 | |||||
Debt instrument, maturity date | Jun. 20, 2019 | ||||||||
Debt principal amounts | $ 270,000 | ||||||||
Hayes Loans [Member] | |||||||||
Debt instrument, description | The Hayes Loans requires from a 0-120 day notification of the demand to repay the loans prior to June 20, 2019. | ||||||||
Hayes Loans [Member] | Minimum [Member] | |||||||||
Debt principal amounts | 25,000 | ||||||||
Hayes Loans [Member] | Maximum [Member] | |||||||||
Debt principal amounts | 100,000 | ||||||||
Sweitzer Loans [Member] | |||||||||
Unsecured loan | $ 50,000 | ||||||||
Debt principal amounts | $ 50,000 | ||||||||
Hayes Loans and Sweitzer Loans [Member] | |||||||||
Debt instrument interest rate | 7.00% | ||||||||
Debt instrument, maturity date | Jun. 20, 2019 | ||||||||
Debt principal amounts | $ 525,000 | ||||||||
Individual Lender [Member] | |||||||||
Notes payable outstanding to unrelated third parties | $ 200,000 | ||||||||
Class A Partnership Units [Member] | |||||||||
Stock repurchased during period, shares | 91,259 | 9,903 | |||||||
Debt due date | 2020-07 | 2019-06 |
Minimum Debt Payments - Schedul
Minimum Debt Payments - Scheduled of Minimum Payments of Debt (Details) | Jan. 31, 2018USD ($) |
2,019 | $ 1,754,309 |
2,020 | 667,883 |
2,021 | 517,945 |
2,022 | 321,321 |
2,023 | 5,071,863 |
Thereafter | 4,327,630 |
Long term debt | 12,660,951 |
Mortgages [Member] | |
2,019 | 254,460 |
2,020 | 267,441 |
2,021 | 278,588 |
2,022 | 295,336 |
2,023 | 4,330,880 |
Thereafter | 4,327,630 |
Long term debt | 9,754,335 |
Notes Payable To Bank [Member] | |
2,019 | 144,185 |
2,020 | 21,625 |
2,021 | 22,868 |
2,022 | 22,552 |
2,023 | 740,983 |
Thereafter | |
Long term debt | 952,213 |
Other Notes Payable [Member] | |
2,019 | 1,355,664 |
2,020 | 378,817 |
2,021 | 216,489 |
2,022 | 3,433 |
2,023 | |
Thereafter | |
Long term debt | $ 1,954,403 |
Description of Beneficial Int73
Description of Beneficial Interests (Details Narrative) - shares | Jul. 19, 2017 | Jan. 31, 2010 | Sep. 15, 2009 | Jan. 05, 2009 | Sep. 10, 2007 | Aug. 18, 2005 | Sep. 10, 2002 | Jan. 02, 2001 | Jan. 31, 2018 | Jan. 31, 2017 |
Number of units were available for sale | 750,000 | 350,000 | 250,000 | 300,000 | 350,000 | 350,000 | 350,000 | 250,000 | ||
Stock repurchased during period, shares | 524,930 | 3,259 | ||||||||
Stock repurchase program, remaining number of shares authorized to be repurchased | 1.99 | 2.55 | ||||||||
Stock repurchase program, number of shares authorized to be repurchased | 662,117 | |||||||||
Shares of Beneficial Interest [Member] | ||||||||||
Stock repurchased during period, shares | 150,973 | 30,227 |
Federal Income Taxes (Details N
Federal Income Taxes (Details Narrative) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Net operating loss carry forwards | $ 4,800,000 | |
Capital gain transactions | 240,000 | |
Operating loss carryforward valuation allowance | ||
Accrued interest or penalties |
Federal Income Taxes - Schedule
Federal Income Taxes - Schedule of Income Tax Provision (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Federal Income Taxes - Schedule Of Income Tax Provision Details | ||
Current income tax provision (benefit) | $ 335,000 | $ (227,000) |
Deferred income tax provision | ||
Net income tax provision (benefit) | $ 335,000 | $ (227,000) |
Federal Income Taxes - Schedu76
Federal Income Taxes - Schedule of Deferred Tax Assets and Liabilities (Details) - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 |
Income Tax Disclosure [Abstract] | ||
Net operating loss carryforwards | $ 2,763,000 | $ 4,040,000 |
Bad debt allowance | (22,000) | (18,000) |
Accrued expenses | 89,000 | 84,000 |
Syndications | 5,179,000 | 5,179,000 |
Prepaid Insurance | 30,000 | 30,000 |
Alternative minimum tax credit | 91,000 | 91,000 |
Total deferred tax assets | 8,130,000 | 9,406,000 |
Deferred income tax liability associated with book/tax differnces in hotel properties | (2,884,000) | (2,459,000) |
Net deferred income tax asset | 5,246,000 | 6,947,000 |
Valuation allowance | (5,246,000) | (6,947,000) |
Net deferred income tax |
Federal Income Taxes - Schedu77
Federal Income Taxes - Schedule of Reconciliation of Differences Between Effective and Statutory Income Tax Rates (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Federal Income Taxes - Schedule Of Income Tax Provision Details | ||
Current income tax provision (benefit) | $ 341,000 | $ (227,000) |
Deferred income tax provision | ||
Net income tax provision (benefit) | $ 341,000 | $ (227,568) |
Federal Income Taxes - Schedu78
Federal Income Taxes - Schedule of Effective Income Tax Rate Reconciliation (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Income Tax Disclosure [Abstract] | ||
Federal statutory rates | $ 1,604,000 | $ (878,000) |
State income taxes | 636,000 | (196,000) |
Changes in valuation allowance | (1,703,000) | 1,445,000 |
True-up to prior year returns | (240,000) | (593,000) |
Other | 44,000 | (5,000) |
Effective rate | $ 341,000 | $ (227,568) |
Federal statutory rates, percent | 34.00% | (34.00%) |
State income taxes, percent | 13.00% | (8.00%) |
Changes in valuation allowance, percent | (36.00%) | 56.00% |
True-up to prior year returns, percent | (5.00%) | (23.00%) |
Other, percent | 1.00% | 0.00% |
Effective rate, percent | 7.00% | (9.00%) |
Other Related Party Transacti79
Other Related Party Transactions (Details Narrative) - USD ($) | May 01, 2017 | Jan. 28, 2016 | Dec. 22, 2015 | Jul. 23, 2013 | Jan. 31, 2018 | Jan. 31, 2017 |
Revenue | $ 10,767,592 | $ 9,197,179 | ||||
Sale of stock | $ 400,000 | |||||
Notes accrue interest rate, percentage | 7.00% | 7.00% | ||||
Interest income | $ 68,358 | $ 28,910 | ||||
Trust [Member] | ||||||
Revenue | 200,000 | 296,000 | ||||
Line of credit maximum borrowing/lending capacity | 1,000,000 | |||||
Advances to affiliate | $ 1,000,000 | |||||
Notes accrue interest rate, percentage | 7.00% | |||||
Trust [Member] | Corporate Card Agreement [Member] | ||||||
Letters of credit outstanding, amount | $ 0 | 115,000 | ||||
Rare Earth Financial, LLC [Member] | ||||||
Restructuring fee | 440,000 | 0 | ||||
Rare Earth Financial, LLC [Member] | Securities Purchase Agreement [Member] | ||||||
Sale of stock, shares | 60,000 | |||||
Sale of stock price per share | $ 2.50 | |||||
Sale of stock | $ 150,000 | |||||
American Express Travel Related Services Company, Inc [Member] | Corporate Card Agreement [Member] | ||||||
Line of credit maximum borrowing/lending capacity | $ 50,000 | |||||
Line of credit interest per annum | $ 0 | |||||
Berg Investment Advisors [Member] | ||||||
Consultative services fee | 42,500 | 3,500 | ||||
Phoenix Northern Resort, LLC [Member] | ||||||
Advances to affiliate | $ 500,000 | |||||
Percentage of advances affiliate owns | 100.00% | |||||
Debt instrument, maturity date | Jun. 30, 2018 | |||||
Notes accrue interest rate, percentage | 7.00% | |||||
Interest income | 0 | |||||
Lending from affiliate | 0 | 19,483 | ||||
Tempe/Phoenix Airport Resort LLC [Member] | ||||||
Advances to affiliate | $ 500,000 | |||||
Percentage of advances affiliate owns | 42.00% | |||||
Debt instrument, maturity date | Jun. 30, 2018 | |||||
Notes accrue interest rate, percentage | 7.00% | |||||
Interest income | 17,061 | |||||
Lending from affiliate | $ 970,353 | $ 359,684 | ||||
InnSuites Hotel Located In Tucson [Member] | ||||||
Partnership ownership interest percentage | 51.01% | |||||
InnSuites Hotel Located in Yuma, Arizona [Member] | ||||||
Partnership ownership interest percentage | 12.79% | |||||
Innsuites Hotel Located in Albuquerque New Mexico [Member] | ||||||
Partnership ownership interest percentage | 22.83% | |||||
General Partner [Member] | ||||||
Partnership ownership interest percentage | 74.80% | 72.11% | ||||
Mr. Wirth and Affiliates [Member] | ||||||
Number of shares held for beneficial interest of trust | 6,939,429 | 6,939,429 | ||||
Percentage of shares issued and outstanding of beneficial interest | 70.99% | 71.93% | ||||
Yearly salary | $ 47,500 | |||||
Mr. Wirth and Affiliates [Member] | Class B Partnership Units [Member] | ||||||
Number of partnership unit held for affiliates | 3,064,038 | 3,407,938 | ||||
Percentage of outstanding partnership units | 23.86% | 25.80% | ||||
IBC Hotels [Member] | Mr. Wirth and Affiliates [Member] | ||||||
Percentage of room revenue received from hotels owned by affiliates | 5.00% | 3.00% | ||||
Related party, monthly accounting fee | $ 2,000 | |||||
Agreement term description | These agreements have no expiration date and may be cancelled by either party with 90-days written notice or 30-days written notice in the event the property changes ownership. |
Fair Value of Financial Instr80
Fair Value of Financial Instruments - Schedule of Fair Value Liabilities Measured on Recurring Basis (Details) - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 |
Mortgage notes payable, carrying amount | $ 9,754,335 | $ 8,075,757 |
Fair Values of Trust's Debt Instruments [Member] | ||
Mortgage notes payable, carrying amount | 9,752,596 | 13,367,706 |
Mortgage notes payable, fair value | 8,164,897 | 13,473,018 |
Notes payable to banks, carrying amount | 952,213 | 2,019,758 |
Notes payable to banks, fair value | 952,213 | 2,019,758 |
Other notes payable, carrying amount | 1,954,405 | 18,069 |
Other notes payable, fair value | $ 1,954,405 | $ 18,195 |
Supplemental Cash Flow Disclo81
Supplemental Cash Flow Disclosures - Schedule of Cash Flow, Supplemental Disclosures (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Supplemental Cash Flow Elements [Abstract] | ||
Cash paid for interest | $ 539,072 | $ 743,932 |
Notes Payables - IHT Shares of Beneficial Interest and Partnership Units repurchases | $ 1,141,756 | $ 7,006 |
Commitments and Contingencies82
Commitments and Contingencies (Details Narrative) - USD ($) | Aug. 04, 2017 | Jan. 31, 2018 | Jan. 31, 2017 |
Restricted cash balance | $ 0 | $ 0 | |
Membership fees and reservation amount | $ 286,000 | 483,000 | |
Office Lease Agreement [Member] | |||
Agreement term | 5 years | ||
Base monthly rent | $ 4,100 | ||
Monthly rent increase percent | 6.00% | ||
Office Lease Agreement [Member] | First Year [Member] | |||
Early termination fee | $ 12,000 | ||
Office Lease Agreement [Member] | Second Year [Member] | |||
Early termination fee | 8,000 | ||
Office Lease Agreement [Member] | Third Year [Member] | |||
Early termination fee | 6,000 | ||
Office Lease Agreement [Member] | Fourth Year [Member] | |||
Early termination fee | 4,000 | ||
Office Lease Agreement [Member] | Fifth Year [Member] | |||
Early termination fee | $ 2,000 | ||
Albuquerque Hotel [Member] | |||
Ground lease expiration year | 2,058 | ||
Lease expense | $ 149,608 | $ 147,587 | |
Tucson Oracle Property [Member] | |||
Percentage of deposit used for capital expenditures | 4.00% |
Commitments and Contingencies -
Commitments and Contingencies - Schedule of Future Minimum Lease Payments (Details) | Jan. 31, 2018USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
FY 2,019 | $ 164,184 |
FY 2,020 | 167,225 |
FY 2,021 | 170,448 |
FY 2,022 | 173,864 |
FY 2,023 | 144,565 |
Thereafter | 5,473,313 |
Total | $ 6,293,599 |
Share-Based Payments (Details N
Share-Based Payments (Details Narrative) - USD ($) | Feb. 10, 2017 | Mar. 31, 2016 | Feb. 29, 2016 | Jan. 31, 2018 | Jan. 31, 2017 |
April 30, 2018 [Member] | CEO [Member] | |||||
Percentage of cash and equity | 50.00% | ||||
1997 Stock Incentive and Option Plan [Member] | |||||
Stock options expiration period | 10 years | ||||
Options granted | 0 | 0 | |||
Options outstanding | 0 | 0 | |||
Options available to grant | 1,000,000 | ||||
Fiscal 2017- Short-Term Cash and Equity Bonus Program [Member] | |||||
Targeted gross operating profit | $ 395,000 | $ 402,000 | |||
Class A and B Limited Partnership Units [Member] | |||||
Percentage of shares of beneficial interest and partnership unit | 10.00% | ||||
Messrs. Kutasi [Member] | |||||
Number of restricted shares issued | 13,980 | ||||
Aggregate grant date fair value of restricted shares issued | $ 13,980 | ||||
Messrs. Robson [Member] | |||||
Number of restricted shares issued | 13,980 | ||||
Aggregate grant date fair value of restricted shares issued | $ 13,980 | ||||
Messrs. Ketcherside [Member] | |||||
Number of restricted shares issued | 13,980 | ||||
Aggregate grant date fair value of restricted shares issued | $ 13,980 |
Share-Based Payments - Summary
Share-Based Payments - Summary of Bonus Consisting of Cash and Shares of Beneficial Interest (Details) | Jan. 31, 2018USD ($)shares |
Pamela J. Barnhill [Member] | Fiscal 2017- Short-Term Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 10,000 |
Shares of Beneficial Interest, Equity | shares | 10,000 |
Pamela J. Barnhill [Member] | Fiscal 2017- Full Year Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 25,000 |
Shares of Beneficial Interest, Equity | shares | 10,000 |
Pamela J. Barnhill [Member] | Fiscal 2017- Payouts Under Short-Term and Full Year Cash and Equity Bonus Programs [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 5,000 |
Shares of Beneficial Interest, Equity | shares | 3,000 |
Pamela J. Barnhill [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 25,000 |
Shares of Beneficial Interest, Equity | shares | 10,000 |
Pamela J. Barnhill [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | February 1, 2017 through May 31, 2017 [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 5,000 |
Shares of Beneficial Interest, Equity | shares | 3,000 |
Pamela J. Barnhill [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | June 1, 2017 through December 31, 2017 [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 10,000 |
Shares of Beneficial Interest, Equity | shares | 4,000 |
Marc E. Berg [Member] | Fiscal 2017- Short-Term Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 2,500 |
Shares of Beneficial Interest, Equity | shares | 2,500 |
Marc E. Berg [Member] | Fiscal 2017- Full Year Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 5,000 |
Shares of Beneficial Interest, Equity | shares | 2,500 |
Marc E. Berg [Member] | Fiscal 2017- Payouts Under Short-Term and Full Year Cash and Equity Bonus Programs [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 1,000 |
Shares of Beneficial Interest, Equity | shares | 750 |
Marc E. Berg [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 5,000 |
Shares of Beneficial Interest, Equity | shares | 2,500 |
Marc E. Berg [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | February 1, 2017 through May 31, 2017 [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 1,000 |
Shares of Beneficial Interest, Equity | shares | 750 |
Marc E. Berg [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | June 1, 2017 through December 31, 2017 [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 2,000 |
Shares of Beneficial Interest, Equity | shares | 1,000 |
Adam B. Remis [Member] | Fiscal 2017- Short-Term Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 5,000 |
Shares of Beneficial Interest, Equity | shares | 5,000 |
Adam B. Remis [Member] | Fiscal 2017- Full Year Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 10,000 |
Shares of Beneficial Interest, Equity | shares | 5,000 |
Adam B. Remis [Member] | Fiscal 2017- Payouts Under Short-Term and Full Year Cash and Equity Bonus Programs [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 2,000 |
Shares of Beneficial Interest, Equity | shares | 1,500 |
Adam B. Remis [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 10,000 |
Shares of Beneficial Interest, Equity | shares | 5,000 |
Adam B. Remis [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | February 1, 2017 through May 31, 2017 [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 2,000 |
Shares of Beneficial Interest, Equity | shares | 1,500 |
Adam B. Remis [Member] | Fiscal 2018- Short-Term Cash and Equity Bonus Program [Member] | June 1, 2017 through December 31, 2017 [Member] | |
Shares of Beneficial Interest, Cash | $ | $ 4,000 |
Shares of Beneficial Interest, Equity | shares | 2,000 |
Segment Reporting (Details Narr
Segment Reporting (Details Narrative) | 12 Months Ended |
Jan. 31, 2018Integer | |
Segment Reporting [Abstract] | |
Number of reportable segments | 2 |
Number of operating segments | 0 |
Segment Reporting - Schedule of
Segment Reporting - Schedule of Reportable Segments (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Total Assets | $ 23,078,072 | $ 22,172,832 |
Total Liabilities | 14,959,103 | 18,547,583 |
Fixed Assets, Net | 15,011,751 | 13,694,268 |
Total Revenue | 10,767,592 | 9,197,179 |
Loss From Continuing Operations | (3,114,807) | (2,355,467) |
Segment Reporting [Member] | ||
Total Assets | 23,078,072 | 22,172,832 |
Total Liabilities | 14,959,103 | 18,547,583 |
Fixed Assets, Net | 15,011,751 | 13,694,268 |
Total Revenue | 10,767,592 | 9,197,179 |
Loss From Continuing Operations | (3,114,807) | (2,355,467) |
Hotel Operations & Corporate Overhead [Member] | ||
Total Assets | 22,201,935 | 20,708,359 |
Total Liabilities | 9,897,562 | 15,280,624 |
Fixed Assets, Net | 14,586,879 | 13,471,799 |
Total Revenue | 9,319,467 | 8,488,387 |
Loss From Continuing Operations | (731,888) | (1,165,554) |
IBC Developments [Member] | ||
Total Assets | 876,137 | 1,464,473 |
Total Liabilities | 5,061,541 | 3,266,959 |
Fixed Assets, Net | 424,872 | 222,469 |
IBC Hospitality [Member] | ||
Total Revenue | 1,448,125 | 708,792 |
Loss From Continuing Operations | $ (2,382,919) | $ (1,189,913) |
Sale of Ontario Hospitality P88
Sale of Ontario Hospitality Properties, LP (Details Narrative) - USD ($) | Jun. 02, 2017 | Jan. 31, 2018 | Jan. 31, 2017 |
Revenue | $ 10,767,592 | $ 9,197,179 | |
Operating expenses | 13,882,399 | 11,552,646 | |
Current assets | 8,066,321 | 1,464,967 | |
Current liabilities | 4,052,461 | 4,405,500 | |
Ontario Hospitality Properties LP [Member] | Unrelated Unitsholders [Member] | |||
Priority return payments | 4,916,000 | ||
Ontario Hospitality Properties LP [Member] | Partnership [Member] | |||
Priority return payments | 3,098,500 | ||
Ontario [Member] | |||
Proceeds from sale of hotel | $ 17,500,000 | ||
Gain on sale of property | 11,400,000 | ||
Proceeds to satisfy mortgage note payable | 7,200,000 | ||
Accruals and payables | $ 2,400,000 | ||
Revenue | 1,471,000 | ||
Operating expenses | 2,100,000 | ||
Current assets | |||
Current liabilities | 86,000 | ||
Depreciation/amortization and capital expenses | $ 178,000 | $ 699,000 |
Discontinued Operations (Detail
Discontinued Operations (Details Narrative) | Jun. 02, 2017USD ($) |
Ontario Hospitality Properties LLLP [Member] | Unrelated Third Party [Member] | |
Number of sale of property amount | $ 17,500,000 |
Discontinued Operations - Sched
Discontinued Operations - Schedule of Assets and Liabilities of Discontinued Operations (Details) - USD ($) | Jan. 31, 2018 | Jan. 31, 2017 |
Discontinued Operations and Disposal Groups [Abstract] | ||
Cash and Cash Equivalents | $ 89,561 | |
Accounts Receivable | 92,743 | |
Prepaid Expenses and Other Current Assets | 46,823 | |
Total Current Assets of Discontinued Operations | 229,127 | |
Property, Plant and Equipment, net | 6,080,597 | |
TOTAL ASSETS OF DISCONTINUED OPERATIONS | 6,309,724 | |
Accounts Payable and Accrued Expenses | 86,976 | 400,402 |
Current Portion of Mortgage Notes Payable | 185,207 | |
Total Current Liabilities of Discontinued Operations | 86,976 | 585,609 |
Mortgage Notes Payable | 5,047,838 | |
TOTAL LIABILITIES OF DISCONTINUED OPERATIONS | $ 86,976 | $ 5,633,447 |
Discontinued Operations and Ass
Discontinued Operations and Assets Held for Sale - Schedule of Disposal Group Including Discontinued Operation Statements and Cash Flow Statements (Details) - USD ($) | 12 Months Ended | |
Jan. 31, 2018 | Jan. 31, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | ||
Room | $ 1,397,324 | $ 3,827,793 |
Food and Beverage | 64,976 | 164,326 |
Other | 8,443 | 26,333 |
TOTAL REVENUE | 1,470,743 | 4,018,452 |
Room | 941,691 | 1,257,499 |
Food and Beverage | 66,152 | 194,992 |
Telecommunication | 656 | |
General and Administrative | 280,082 | 457,835 |
Sales and Marketing | 123,300 | 298,071 |
Repairs and Maintenance | 100,149 | 290,487 |
Hospitality | 122,227 | 216,651 |
Utilities | 74,640 | 245,968 |
Depreciation | 177,824 | 698,828 |
Real Estate and Personal Property Taxes, Insurance and Ground Rent | 56,015 | 129,897 |
Other | 6,418 | (3,361) |
TOTAL OPERATING EXPENSES | 1,948,498 | 3,787,523 |
OPERATING LOSS | (477,755) | 230,929 |
Interest Income | 961 | |
TOTAL OTHER INCOME | 961 | |
Interest on Mortgage Notes Payable | 127,787 | 265,743 |
Interest on Other Notes Payable | 779 | 4,518 |
TOTAL INTEREST EXPENSE | 128,566 | 270,261 |
CONSOLIDATED NET LOSS OF DISCONTINUED OPERATIONS | (605,360) | (39,332) |
NET CASH USED IN OPERATING ACTIVITIES FROM DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE | (406,064) | (2,153) |
NET CASH USED IN INVESTING ACTIVITIES FROM DISCONTINUED OPERATIONS AND ASSETS HELD FOR SALE |
Stock Options (Details Narrativ
Stock Options (Details Narrative) | Feb. 05, 2015shares |
Board of Trustees [Member] | 2015 Equity Incentive Plan [Member] | |
Shares of beneficial interest of trust are authorized to issued | 1,600,000 |