Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Oct. 31, 2020 | Mar. 24, 2021 | |
Cover [Abstract] | ||
Entity Registrant Name | INNSUITES HOSPITALITY TRUST | |
Entity Central Index Key | 0000082473 | |
Document Type | 10-Q | |
Document Period End Date | Oct. 31, 2020 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --01-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business Flag | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 9,063,514 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Oct. 31, 2020 | Jan. 31, 2020 |
Current Assets: | ||
Cash and Cash Equivalents | $ 47,386 | $ 1,200,528 |
Accounts Receivable, including approximately $37,000 and $375,000 from related parties and net of Allowance for Doubtful Accounts of approximately $22,000 and $15,000 as of October 31, 2020 and January 31, 2020, respectively | 47,215 | 585,226 |
Income Tax Receivable | 119,661 | 294,402 |
Advances to Affiliates - Related Party | 657,000 | 1,000,000 |
Current Portion of Note Receivable (net) | 91,667 | |
Prepaid Expenses and Other Current Assets | 85,276 | 77,806 |
Total Current Assets | 956,538 | 3,249,629 |
Property, Plant and Equipment, (net) | 8,367,801 | 8,983,323 |
Note Receivable (net) | 1,925,500 | 1,833,333 |
Operating Lease - Right of Use | 2,162,331 | 2,197,364 |
Finance Lease - Right of Use | 83,246 | 131,806 |
Investments | 1,030,000 | 600,000 |
TOTAL ASSETS | 14,525,416 | 16,995,455 |
Current Liabilities: | ||
Accounts Payable and Accrued Expenses | 1,685,348 | 1,384,971 |
Current Portion of Notes Payable - Related Party | 35,000 | 161,440 |
Current Portion of Mortgage Notes Payable, net of Discount | 166,768 | 160,849 |
Current Portion of Notes Payable to Banks, net of Discount | 500 | 17,100 |
Current Portion of Other Notes Payable | 682,318 | 806,712 |
Current Portion of Operating Lease Liability | 56,960 | 168,780 |
Current Portion of Finance Lease Liability | 27,523 | 31,123 |
Total Current Liabilities | 2,654,417 | 2,730,975 |
Mortgage Notes Payable, net of Discount | 5,818,131 | 5,944,819 |
Other Notes Payable | 525,432 | 73,491 |
Operating Lease Liability, net of current portion | 2,326,160 | 2,252,964 |
Finance Lease Liability, net of current portion | 59,209 | 75,396 |
TOTAL LIABILITIES | 11,383,349 | 11,077,645 |
COMMITMENTS AND CONTINGENCIES | ||
SHAREHOLDERS' EQUITY | ||
Shares of Beneficial Interest, without par value, unlimited authorization; 18,626,215 and 18,608,215 shares issued and 9,057,730 and 9,273,299 shares outstanding at October 31, 2020 and January 31, 2020, respectively | 20,485,317 | 21,837,048 |
Treasury Stock, 9,568,485 and 9,334,916 shares held at cost at October 31, 2020 and January 31, 2020, respectively | (13,936,972) | (13,689,533) |
TOTAL TRUST SHAREHOLDERS' EQUITY | 6,548,345 | 8,147,515 |
NON-CONTROLLING INTEREST | (3,406,279) | (2,229,705) |
TOTAL EQUITY | 3,142,066 | 5,917,515 |
TOTAL LIABILITIES AND EQUITY | $ 14,525,416 | $ 16,995,455 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | 9 Months Ended | 12 Months Ended |
Oct. 31, 2020 | Jan. 31, 2020 | |
Statement of Financial Position [Abstract] | ||
Accounts receivable from related parties | $ 37,000 | $ 375,000 |
Allowance for doubtful accounts receivable | $ 22,000 | $ 15,000 |
Shares of beneficial interest, without par value | ||
Shares of beneficial interest, authorized shares | Unlimited | Unlimited |
Shares of beneficial interest, shares issued | 18,626,215 | 18,608,215 |
Shares of beneficial interest, shares outstanding | 9,057,730 | 9,273,299 |
Treasury stock, shares held | 9,568,485 | 9,334,916 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | |
REVENUE | ||||
TOTAL REVENUE | $ 952,959 | $ 1,497,246 | $ 3,323,757 | $ 5,123,661 |
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 1,631,743 | 1,527,841 | 5,519,108 | 5,729,262 |
OPERATING LOSS | (678,784) | (30,595) | (2,195,351) | (605,601) |
Interest Income | 17,500 | 62,225 | 81,852 | 65,752 |
TOTAL OTHER INCOME | 17,500 | 62,225 | 81,852 | 65,752 |
Interest on Mortgage Notes Payable | 110,687 | 68,338 | 219,032 | 181,503 |
Interest on Notes Payable to Banks | 103 | |||
Interest on Other Notes Payable | (4,032) | 115,195 | 55,547 | 190,941 |
TOTAL INTEREST EXPENSE | 106,655 | 183,533 | 274,682 | 372,444 |
CONSOLIDATED NET LOSS | (767,940) | (151,903) | (2,388,181) | (912,293) |
LESS: NET (LOSS) INCOME ATTRIBUTABLE TO NON-CONTROLLING INTEREST | (286,830) | 49,202 | (1,100,281) | 93,634 |
NET LOSS ATTRIBUTABLE TO CONTROLLING INTERESTS | $ (481,110) | $ (201,105) | $ (1,287,900) | $ (1,005,927) |
NET LOSS PER SHARE TOTAL - BASIC & DILUTED | $ (0.08) | $ (0.02) | $ (0.26) | $ (0.10) |
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING - BASIC & DILUTED | 9,069,326 | 9,298,268 | 9,187,337 | 9,324,548 |
Room [Member] | ||||
REVENUE | ||||
TOTAL REVENUE | $ 878,813 | $ 1,439,693 | $ 3,006,851 | $ 4,917,000 |
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 342,698 | 493,030 | 1,169,010 | 1,520,904 |
Food and Beverage [Member] | ||||
REVENUE | ||||
TOTAL REVENUE | 13,974 | 20,049 | 46,952 | 52,456 |
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 30,542 | 24,214 | 93,788 | 71,521 |
Management and Trademark Fees [Member] | ||||
REVENUE | ||||
TOTAL REVENUE | 33,696 | 37,504 | 108,944 | 129,202 |
Other [Member] | ||||
REVENUE | ||||
TOTAL REVENUE | 26,476 | 161,010 | 25,003 | |
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 1,535 | 7,697 | 6,943 | 17,416 |
Telecommunications [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 978 | 1,873 | 395 | |
General and Administrative [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 541,664 | 217,526 | 1,459,425 | 1,712,769 |
Sales and Marketing [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 84,287 | 112,278 | 306,861 | 386,498 |
Repairs and Maintenance [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 86,801 | 95,429 | 262,214 | 297,761 |
Hospitality [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 24,624 | 127,258 | 119,331 | 398,220 |
Utilities [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 93,966 | 115,300 | 272,229 | 308,540 |
Depreciation [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 207,300 | 269,887 | 634,010 | 764,566 |
Real Estate and Personal Property Taxes, Insurance and Ground Rent [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | 138,910 | 65,222 | 348,986 | 250,672 |
Sales and Occupancy Tax [Member] | ||||
OPERATING EXPENSES | ||||
TOTAL OPERATING EXPENSES | $ 78,438 | $ 844,438 |
Condensed Consolidated Statem_2
Condensed Consolidated Statement of Shareholders' Equity (Unaudited) - USD ($) | Shares of Beneficial Interest [Member] | Treasury Stock [Member] | Trust Shareholders' Equity [Member] | Non-Controlling Interest [Member] | Total |
Balance at Jan. 31, 2019 | $ 23,738,260 | $ (13,517,833) | $ 10,220,427 | $ (1,471,912) | $ 8,748,515 |
Balance, shares at Jan. 31, 2019 | 9,366,076 | 9,223,884 | |||
Net (Loss) Income | $ (328,854) | (328,854) | 59,024 | (269,830) | |
Purchase of Treasury Stock | $ (58,096) | (58,096) | (58,096) | ||
Purchase of Treasury Stock, shares | (32,732) | 32,732 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 8,100 | 8,100 | 8,100 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | 18,000 | ||||
Distribution to Non-Controlling Interests | (139,679) | (139,679) | |||
Balance at Apr. 30, 2019 | $ 23,417,506 | $ (13,575,929) | 9,841,577 | (1,552,567) | 8,289,010 |
Balance, shares at Apr. 30, 2019 | 9,351,344 | 9,256,616 | |||
Balance at Jan. 31, 2019 | $ 23,738,260 | $ (13,517,833) | 10,220,427 | (1,471,912) | 8,748,515 |
Balance, shares at Jan. 31, 2019 | 9,366,076 | 9,223,884 | |||
Net (Loss) Income | (912,293) | ||||
Balance at Oct. 31, 2019 | $ 22,660,724 | $ (13,641,600) | 9,019,124 | (1,747,504) | 7,271,620 |
Balance, shares at Oct. 31, 2019 | 9,310,691 | 9,297,269 | |||
Balance at Apr. 30, 2019 | $ 23,417,506 | $ (13,575,929) | 9,841,577 | (1,552,567) | 8,289,010 |
Balance, shares at Apr. 30, 2019 | 9,351,344 | 9,256,616 | |||
Net (Loss) Income | $ (475,968) | (475,968) | (14,592) | (490,560) | |
Purchase of Treasury Stock | $ (51,385) | (51,385) | (51,385) | ||
Purchase of Treasury Stock, shares | (32,410) | 32,410 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 8,100 | 8,100 | 8,100 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | |||||
Distribution to Non-Controlling Interests | (60,554) | (60,554) | |||
Dividends | (95,909) | (95,909) | (95,909) | ||
Balance at Jul. 31, 2019 | $ 22,853,729 | $ (13,627,314) | 9,226,415 | (1,627,713) | 7,598,702 |
Balance, shares at Jul. 31, 2019 | 9,318,934 | 9,289,026 | |||
Net (Loss) Income | $ (201,105) | (201,105) | 49,202 | (151,903) | |
Purchase of Treasury Stock | $ (14,286) | (14,286) | (14,286) | ||
Purchase of Treasury Stock, shares | (8,243) | 8,243 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 8,100 | 8,100 | 8,100 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | |||||
Distribution to Non-Controlling Interests | (168,993) | (168,993) | |||
Balance at Oct. 31, 2019 | $ 22,660,724 | $ (13,641,600) | 9,019,124 | (1,747,504) | 7,271,620 |
Balance, shares at Oct. 31, 2019 | 9,310,691 | 9,297,269 | |||
Balance at Jan. 31, 2020 | $ 21,837,048 | $ (13,689,533) | 8,147,515 | (2,229,705) | 5,917,515 |
Balance, shares at Jan. 31, 2020 | 9,273,299 | 9,334,916 | |||
Net (Loss) Income | $ (141,872) | (141,872) | (210,985) | (352,857) | |
Purchase of Treasury Stock | $ (20,772) | (20,772) | (20,772) | ||
Purchase of Treasury Stock, shares | (17,074) | 17,074 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 8,100 | 8,100 | 8,100 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | 18,000 | ||||
Sales of Ownership Interests in Subsidiary, net | 10,000 | 10,000 | |||
Distribution to Non-Controlling Interests | (105,347) | (105,347) | |||
Reallocation of Non-Controlling Interests and Other | 10,494 | 10,494 | (10,494) | ||
Balance at Apr. 30, 2020 | $ 21,713,770 | $ (13,710,305) | 8,003,465 | (2,546,531) | 5,456,934 |
Balance, shares at Apr. 30, 2020 | 9,274,225 | 9,351,990 | |||
Balance at Jan. 31, 2020 | $ 21,837,048 | $ (13,689,533) | 8,147,515 | (2,229,705) | 5,917,515 |
Balance, shares at Jan. 31, 2020 | 9,273,299 | 9,334,916 | |||
Net (Loss) Income | (2,388,181) | ||||
Balance at Oct. 31, 2020 | $ 20,485,317 | $ (13,936,972) | 6,548,345 | (3,406,279) | 3,142,066 |
Balance, shares at Oct. 31, 2020 | 9,057,730 | 9,568,485 | |||
Balance at Apr. 30, 2020 | $ 21,713,770 | $ (13,710,305) | 8,003,465 | (2,546,531) | 5,456,934 |
Balance, shares at Apr. 30, 2020 | 9,274,225 | 9,351,990 | |||
Net (Loss) Income | $ (664,919) | (664,919) | (602,466) | (1,267,385) | |
Purchase of Treasury Stock | $ (186,567) | (186,567) | (186,567) | ||
Purchase of Treasury Stock, shares | (181,815) | 181,815 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 6,300 | 6,300 | 6,300 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | |||||
Dividends | $ (95,924) | (95,924) | (95,924) | ||
Balance at Jul. 31, 2020 | $ 20,959,227 | $ (13,896,872) | 7,062,355 | (3,148,997) | 3,913,358 |
Balance, shares at Jul. 31, 2020 | 9,092,410 | 9,533,805 | |||
Net (Loss) Income | $ (481,110) | (481,110) | (286,830) | (767,940) | |
Purchase of Treasury Stock | $ (40,100) | (40,100) | (40,100) | ||
Purchase of Treasury Stock, shares | (34,680) | 34,680 | |||
Shares of Beneficial Interest Issued for Services Rendered | $ 7,200 | 7,200 | 7,200 | ||
Shares of Beneficial Interest Issued for Services Rendered, shares | |||||
Reallocation of Non-Controlling Interests and Other | 29,548 | 29,548 | |||
Balance at Oct. 31, 2020 | $ 20,485,317 | $ (13,936,972) | $ 6,548,345 | $ (3,406,279) | $ 3,142,066 |
Balance, shares at Oct. 31, 2020 | 9,057,730 | 9,568,485 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Consolidated Net Loss | $ (2,388,181) | $ (912,293) |
Adjustments to Reconcile Consolidated Net Loss to Net Cash (Used In) Provided By Operating Activities: | ||
Stock-Based Compensation | 21,600 | 24,300 |
Depreciation | 634,010 | 764,566 |
Changes in Assets and Liabilities: | ||
Accounts Receivable | 537,512 | (145,184) |
Income Tax Receivable | 174,741 | |
Prepaid Expenses and Other Assets | (7,470) | 11,547 |
Operating Lease | (3,591) | |
Finance Lease | 28,773 | |
Accounts Payable and Accrued Expenses | 281,889 | 370,667 |
NET CASH (USED IN) PROVIDED BY OPERATING ACTIVITIES | (720,718) | 113,603 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Improvements and Additions to Hotel Properties | (242,355) | |
Investments in Unigen | (430,000) | |
Purchase of Marketable Securities | 1,106,183 | |
Lendings on Advances to Affiliates - Related Party | (12,000) | (127,055) |
Collections on Advances to Affiliates - Related Party | 355,000 | 25,353 |
NET CASH (USED IN) PROVIDED BY INVESTING ACTIVITIES | (87,000) | 762,126 |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Principal Payments on Mortgage Notes Payable | (120,769) | (86,889) |
Borrowings on Mortgage Notes Payable | ||
Payments on Notes Payable to Banks, net of financing costs | (16,600) | (156,000) |
Borrowings on Notes Payable to Banks, net of financing costs | 146,700 | |
Lendings on Notes Receivable - Related Party | (254,813) | |
Collections on Notes Receivable - Related Party | 888,027 | |
Payments on Notes Payable - Related Party | (271,440) | (240,210) |
Borrowings on Notes Payable - Related Party | 145,000 | |
Payments on Other Notes Payable | (185,677) | (604,419) |
Borrowings on Other Notes Payable | 513,224 | 11,000 |
Payment of Dividends | (95,924) | (95,909) |
Proceeds from Sale of Non-Controlling Ownership Interest in Subsidiary, net | 10,000 | |
Distributions to Non-Controlling Interest Holders | (105,347) | (369,226) |
Repurchase of Treasury Stock | (247,439) | (123,767) |
NET CASH USED IN FINANCING ACTIVITIES | (345,424) | (885,506) |
NET DECREASE IN CASH AND CASH EQUIVALENTS | (1,153,142) | (9,777) |
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD | 1,200,528 | 749,075 |
CASH AND CASH EQUIVALENTS AT END OF PERIOD | $ 47,386 | $ 739,298 |
Nature of Operations and Basis
Nature of Operations and Basis of Presentation | 9 Months Ended |
Oct. 31, 2020 | |
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 October 31, 2020, InnSuites Hospitality Trust (the “Trust”, “IHT”, “we”, “us” or “our”) is a publicly traded unincorporated Ohio real estate investment trust (REIT) with two hotels IHT owns and three hotels IHT manages. The Trust and its shareholders directly in and through a Partnership, own interests in two hotels with an aggregate of 270 hotel suites in Arizona and New Mexico, both (the “Hotels”) operated under the federally trademarked name “InnSuites Hotels” or “InnSuites” as well as operating under the brand name “Best Western”. The Trust and its shareholders hold a $1 million 6% convertible debenture in UniGen Power Inc., (“UPI”), and hold warrants to make further UPI Investments in the future. Hotel Operations: Our Tucson, Arizona Hotel and our Hotel located in Albuquerque, New Mexico are limited service hotels. Both hotels offer swimming pools, fitness centers, business centers, and complimentary breakfast. In addition the Hotels offer social areas and modest conference facilities. The Trust is the sole general partner of RRF Limited Partnership, a Delaware limited partnership (the “Partnership”) and owned a 75.89% interest in the Partnership as of October 31, 2020 and January 31, 2020, respectively. The Trust’s weighted average ownership for the nine months ended October 31, 2020 and 2019 was 75.89%. As of October 31, 2020, the Partnership owned a 51.01% interest in an InnSuites® hotel located in Tucson, Arizona. The Trust owns a direct 20.17% interest in an InnSuites® hotel located in Albuquerque, New Mexico. InnSuites Hotels Inc.(“IHI”), a subsidiary, manages the Hotels’ daily operations under 3 management agreements. The Trust also provides the use of the “InnSuites” trademark to the Hotels through wholly-owned IHI. All expenses and reimbursements between the Trust, IHI and the Partnership have been eliminated in consolidation. The Trust classified the Hotels as operating assets, but these assets are available for sale. At this time, the Trust is unable to predict when, and if, any of these will be sold. Neither the Tucson Hotel nor the Albuquerque Hotel is currently listed but the Trust is willing to consider offers for the Hotel. Each of the Hotels is being marketed at a price that management believes is reasonable in relation to its current fair value. PRINCIPLES OF CONSOLIDATION AND BASIS OF PRESENTATION These consolidated financial statements have been prepared by management in accordance with accounting principles in conformity with accounting principles generally accepted in the United States of America (“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 20.17 % - Tucson Hospitality Properties, LLLP - 51.01 % RRF Limited Partnership 75.89 % - InnSuites Hotels Inc. 100.00 % - (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 limited partner holding the units. 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 October 31, 2020 and January 31, 2020, 211,708 Class A Partnership units were issued and outstanding, representing 1.60% of the total Partnership units, respectively. Additionally, as of October 31, 2020 and January 31, 2020, 2,974,038 Class B Partnership units were outstanding to and owned by James Wirth, the Trust’s Chairman and Chief Executive Officer, and Mr. Wirth’s affiliates. If all the Class A and B Partnership units were converted on October 31, 2020 and January 31, 2020, the limited partners in the Partnership would receive 3,185,746 Shares of Beneficial Interest of the Trust. As of October 31, 2020, and January 31, 2020, the Trust owns 10,025,771 general partner units in the Partnership, representing 75.89% of the total Partnership units. LIQUIDITY The Trust’s principal source of cash to meet its cash requirements, including distributions to its shareholders, is our share of the Partnership quarterly distributions coming from the Tucson Hotel as well as cash flow; quarterly distributions and cash flow from the Albuquerque, New Mexico property, management fees charged to Trust and Affiliate hotels, repayments of intercompany loans for the Tucson and Albuquerque Hotels and more recently, sales and/or refinance of certain hotels. The Partnership’s principal source of cash flow is quarterly distributions from the Tucson, Arizona property. The Trust’s liquidity, including our ability to make distributions to its shareholders, will depend upon the ability of the Trust and the Partnership’s ability to generate sufficient cash flow from hotel operations and to service debt, as well as to generate funds from repayment of loans and sale of assets. The Covid-19 Virus (the “Virus”) has disrupted the quarterly distributions from both the Albuquerque and Tucson hotels. Another principal source of cash is derived from the management fees of the Albuquerque, Tucson, and Tempe Hotels. At a future date, the Trust may receive cash from the operations and/or full or partial sale of its Unigen diversification investment. As of October 31, 2020, the Trust had a related party Demand/Revolving Line of Credit/Promissory Note with an amount payable of approximately $35,000. 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, 2021, and renews annually. As of October 31, 2020, the outstanding net balance receivable on the Demand/Revolving Line of Credit/Promissory Note was $0. As of October 31, 2020, the Trust had Advance to Affiliate credit facilities with an aggregate maximum borrowing capacity of $1,000,000, which is available through December 31, 2020, and renews annually. As of October 31, 2020, the Trust had an amount receivable of the Advances to Affiliate credit facility of $657,000. As of October 31, 2020, the Trust had a Revolving line of Credit of $150,000 with the Republic Bank of Arizona. The line had a zero balance as of October 31, 2020. With approximately $47,000 of cash, as of October 31, 2020, the availability of a $1,000,000 related party Demand/Revolving Line of Credit/Promissory Note, the availability of the combined $1,000,000 Advance to Affiliate credit facilities, and the $150,000 Revolving Line of Credit with Republic Bank, the Trust believes that it has and will have enough cash on hand to meet all of the financial obligations as they become due for twelve months from the date of filing this 10-Q. In addition, management is analyzing other strategic options available to the Trust, including the sale or refinance of one or both Hotel properties. However, such transactions may not be available on terms that are favorable to the Trust, or at all. There can be no assurance that the Trust will be successful selling properties, refinancing debt or raising additional or replacement funds, or that these funds may be available on terms that are favorable to it. If the Trust is unable to raise additional or replacement funds, it may be required to sell certain of our assets to meet liquidity needs, which may not be on terms that are favorable. TEMPE HOTEL SUBSEQUENT EVENT Subsequent to the end of the Third Fiscal Quarter, an affiliate of the Trust sold the Tempe Hotel on December 18, 2020. At that time, the Trust received in the Fourth Fiscal quarter the full repayment of the approximately $657,000 intercompany loan to Tempe. BASIS OF PRESENTATION The accompanying unaudited condensed consolidated financial statements have been prepared by the Trust in accordance with Generally Accepted Accounting Principles (“GAAP”), for interim financial information, and pursuant to the instructions to Form 10-Q and Article 10 of Regulation S-X promulgated by the Securities and Exchange Commission (“SEC”). Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statement presentation. However, the Trust believes that the disclosures are adequate to make the information presented not misleading. In the opinion of management, all adjustments (consisting primarily of normal recurring accruals) considered necessary for a fair presentation have been included. Operating results for the nine months ended October 31, 2020 are not necessarily indicative of the results that may be expected for the fiscal year ending January 31, 2021. The unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Trust’s Annual Report on Form 10-K for the year ended January 31, 2020. The Trust has evaluated subsequent events through the date of the filing of its Form 10-Q with the Securities and Exchange Commission. Other than those events disclosed, the Trust is not aware of any other significant events that occurred subsequent to the balance sheet date but prior to the filing of this report that would have a material impact on the Trust’s financial statements. As sole general partner of the Partnership, the Trust exercises unilateral control over the Partnership, and the Trust owns all of the issued and outstanding classes of shares of InnSuites Hotels Inc. Therefore, the financial statements of the Partnership and InnSuites Hotels Inc. are consolidated with the Trust, and all significant intercompany transactions and balances have been eliminated. Under Accounting Standards Codification (“ASC”) Topic 810-10-25, Albuquerque Suite Hospitality, LLC has been determined to be a variable interest entity with the Trust as the primary beneficiary (see Note 4 – “Variable Interest Entity”). Therefore, the financial statements of Albuquerque Suite Hospitality, LLC, are consolidated with the Trust, and all significant intercompany transactions and balances have been eliminated. The financial statements of the Partnership and Tucson Hospitality Properties, LLLP are consolidated with the Partnership and the Trust, and all significant intercompany transactions and balances have been eliminated. SEASONALITY OF THE HOTEL BUSINESS The Hotels’ operations historically have been somewhat seasonal. The Tucson Arizona Hotel experiences the highest occupancy in the first fiscal quarter (the winter season) and, to a lesser extent, the fourth fiscal quarter. The second fiscal quarter tends to be the lowest occupancy period at this Arizona Hotel. This seasonality pattern can be expected to cause fluctuations in the Trust’s quarterly revenues. The Hotel located in Albuquerque, 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 travel disruptions, labor force shortages and cash flow issues. Further, if an adverse event such as an actual or threatened virus pandemic, terrorist attack, international conflict, data breach, regional economic downturn or poor weather should occur at either of its two hotels, the adverse impact to the Trust’s revenues and profit could be significant. RECENTLY ISSUED ACCOUNTING GUIDANCE The Trust adopted ASU No. 2016-02 as of February 1, 2019, using the modified retrospective approach wherein entities were allowed to initially apply the new leases standard at adoption date which had no effect to the opening balance of retained earnings in the period of adoption. Accordingly, all periods prior to February 1, 2019 were presented in accordance with the previous ASC Topic 840, Leases, and no retrospective adjustments were made to the comparative periods presented. The Trust elected the package of practical expedients permitted under the new standard which, among other things, allowed the Trust to not reassess the lease classification, the lease identification, and the initial direct costs for any existing leases. Further, as permitted by the standard, the Trust made an accounting policy election not to record ROU assets or lease liabilities for leases with a term of 12 months or less. Instead, consistent with legacy accounting guidance, the Trust will recognize payments for such leases in the condensed consolidated statement of operations on a straight-line basis over the lease term. With adoption on February 1, 2019, this standard resulted in the recognition of additional assets of $2,821,410 and liabilities of $2,913,568 upon adoption on its accompanying condensed consolidated balance sheet. The new standard did not have a material impact on the Trust’s results of operations or cash flows. In June 2018, the FASB issued Accounting Standards Update (“ASU”) 2018-07, Compensation – Stock Compensation (Topic 718) Improvements to Nonemployee Share-Based Payment Accounting |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 9 Months Ended |
Oct. 31, 2020 | |
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 unaudited condensed 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, virus/pandemic, 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, EQUIPMENT, AND HOTEL PROPERTIES Furniture, fixtures, building and improvements and hotel properties are stated at cost, except for land, and depreciated using the straight-line method over estimated lives ranging up to 40 years for buildings and improvements, and 3 to 10 years for furniture, fixtures and equipment. Land is an indefinite-lived asset. The Trust tests its land for impairment annually, or whenever events or changes in circumstances indicates an impairment may have occurred, by comparing its carrying value to its implied fair value. For tax purposes the Trust may take advantage of accelerated depreciation methods (MACRS) for new capital additions and improvements to its Hotels. 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, or not, 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. 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. SHORT-TERM INVESTMENTS – AVAILABLE FOR SALE SECURITIES The Trust currently holds a liquid investment account with Charles Schwab. The Trust believes it places its investments only with high credit quality financial institutions. REVENUE RECOGNITION Hotel and Operations ASU 2014-09 (Topic 606), “Revenue from Contracts with Customers” is effective for reporting periods beginning after December 15, 2017. 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. Revenues are primarily derived from the sources below and are recognized as services are rendered and when collectability is reasonably assured. Amounts received in advance of revenue recognition are considered deferred liabilities and are generally not significant. 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. Each room night consumed by a guest with a cancellable reservation represents a contract whereby the Trust has a performance obligation to provide the room night at an agreed upon price. For cancellable reservations, the Trust recognizes revenue as each performance obligation (i.e., each room night) is met. Such contract is renewed if the guest continues their stay. For room nights consumed by a guest with a non-cancellable reservation, the entire reservation period represents the contract term whereby the Trust has a performance obligation to provide the room night or nights at an agreed upon price. For non-cancellable reservations, the Trust recognizes revenue over the term of the performance period (i.e., the reservation period) as room nights are consumed. For these reservations, the room rate is typically fixed over the reservation period. The Trust uses an output method based on performance completed to date (i.e., room nights consumed) to determine the amount of revenue it recognizes on a daily basis if the length of a non-cancellable reservation exceeds one night since consumption of room nights indicates when services are transferred to the guest. In certain instances, variable consideration may exist with respect to the transaction price, such as discounts, coupons and price concessions made upon guest checkout. In evaluating its performance obligation, the Trust bundles the obligation to provide the guest the room itself with other obligations (such as free Wi-Fi, grab and go breakfast, access to on-site laundry facilities and parking), as the other obligations are not distinct and separable because the guest cannot benefit from the additional amenities without the consumed room night. The Trust’s obligation to provide the additional items or services is not separately identifiable from the fundamental contractual obligation (i.e., providing the room and its contents). The Trust has no performance obligations once a guest’s stay is complete. 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. ACCOUNTS RECEIVABLES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Accounts receivable are derived from guest stays and other reservations at the Hotels. 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 due and 100% of balances over 120 days due. 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 three months ended October 31, 2020 and the fiscal year ended January 31, 2020. Fiscal Year Balance at the Discontinued Charged to Deductions Balance at October 31, 2020 $ (14,789 ) $ - $ (6,933 ) $ - $ (21,722 ) January 31, 2020 $ (5,943 ) $ - $ (13,223 ) $ 4,377 $ (14,789 ) INCOME TAX RECEIVABLE The Trust amended its corporate tax returns for the previous year ended January 31, 2019. Such amendments resulted in a refund of approximately $294,000, of which the Trust received approximately $175,000 in August 2020. The Trust expects to receive the remaining $120,000 by July 31, 2021. LEASE ACCOUNTING The Trust determines, at the inception of a contract, if the arrangement is a lease and whether it meets the classification criteria for a finance or operating lease. ROU assets represent the Trust’s right to use an underlying asset during the lease term and lease liabilities represent the Trust’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at commencement date based on the present value of fixed lease payments over the lease term. ROU assets also include any advance lease payments and exclude lease incentives. As most of the Trust’s operating leases do not provide an implicit rate, the Trust uses its incremental borrowing rate based on information available at commencement date in determining the present value of lease payments. Finance lease agreements generally include an interest rate that is used to determine the present value of future lease payments. Operating fixed lease expense and finance lease depreciation expense are recognized on a straight-line basis over the lease term (see Note 14). TRUSTEE STOCK-BASED COMPENSATION The Trust has an employee equity incentive plan, which is described more fully in Note 15 - “Share-Based Payments.” The three independent members of the Board of Trustees earn 6,000 IHT Shares per year. The Trust has paid the annual fees due to its Trustees by issuing Shares of Beneficial Interest out of its authorized but unissued Shares. 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 the nine months ended October 31, 2020, the Trust granted restricted stock awards of 18,000 Shares to three independent members of the Board of Trustees, resulting in stock-based compensation of $21,600. The shares vest over one year, through the end of fiscal year ended January 31, 2021 monthly at a rate of approximately 500 shares for each outside Trustee or a total of 1,500 per month for three independent Trustees. 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. NET LOSS PER SHARE Basic and diluted net 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 3,185,746 Shares of the Beneficial Interest, as discussed in Note 1. For the nine months ended October 31, 2020 and 2019, 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 3,185,746 in addition to the basic shares outstanding for the nine months ended October 31, 2020 and 2019. These Shares of Beneficial Interest issuable upon conversion of the Class A and Class B Partnership units were anti-dilutive during the nine months ended October 31, 2020 and 2019 and are excluded in the calculation of diluted earnings per share for those periods. ADVERTISING COSTS Amounts incurred for advertising costs are expensed as incurred. Advertising expense for continuing operations totaled approximately $39,000 and $59,000 for the three months ended October 31, 2020 and 2019 respectively, and $154,000 and $233,000 for the nine months ended October 31, 2020 and 2019, 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 assets that are carried at fair value on a recurring basis, including warrants in a 3 rd 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. INVESTMENT IN UNIGEN POWER, INC. On December 16, 2019, the Trust entered into a Convertible Debenture Purchase Agreement with UniGen Power Inc. (“UPI” or “UniGen”). The Trust purchased secured convertible debentures (“Debentures”) in the aggregate amount of $1,000,000 (the “Loan Amount”) (the “Loan”) at an annual interest rate of 6%. The Debentures are convertible into Class A shares of UniGen Common Stock at an initial conversion rate of $1.00 per share. The Loan is structured into two (2) payments of $600,000 and $400,000. The first payment of $600,000 was made by the Trust at closing on December 16, 2019 and the second payment of $400,000 was made on February 3, 2020. UniGen issued the Trust common stock purchase warrants (the “Debenture Warrants”) to purchase up to 1,000,000 shares of Class A Common Stock (600,000 issued on January 31, 2020, and 400,000 issued on February 3, 2020). The Debenture Warrants are exercisable at an exercise price of $1.00 per share of Class A Common Stock. UniGen, also, issued the Trust additional common stock purchase warrants (“Additional Warrants”) to purchase up to 200,000 shares of Class A Common Stock (120,000 issued at January 31, 2020, and 80,000 issued on February 3, 2020). The Additional Warrants are exercisable at an exercise price of $2.25 per share of Class A Common Stock. On the Trust’s balance sheet, the investment of the $1,030,000 made in the current fiscal year consists of approximately $424,000 in note receivables, approximately $576,000 as the fair value of the warrant issued with the Trust’s investment in UniGen, and $30,000 in accrued interest income, which was re-invested in Unigen. The value of the premium related to the fair value of the warrants will accrete over the life of the debentures. The value of the warrants was based on Black-Scholes pricing model based on the following inputs: Debenture Warrants Type of option Call option Stock price $ 2.25 Exercise (Strike) price $ 1.00 Time to maturity (years) 2.0 Annualized risk-free rate 1.630 % Annualized volatility 27.43 % Additional Warrants Type of option Call option Stock price $ 2.25 Exercise (Strike) price $ 2.25 Time to maturity (years) 2.0 Annualized risk-free rate 1.630 % Annualized volatility 27.43 % UNIGEN SUBSEQUENT EVENT UniGen has also agreed to allow IHT to fund a $500,000 line of credit at the option of IHT convertible into 500,000 shares of UniGen stock at $1 per share. And upon full subscription of the UniGen $2 million syndication, IHT will be granted an additional 300,000 warrants at $2.25 per share. If all notes are converted and all warrants exercised, IHT would hold 3 million UniGen shares out of a total of approximately 12 million UniGen shares resulting in IHT owning approximately 25% of UniGen. Subsequent to October 31, 2020, no activity has occurred with this line of credit and thus no draws have been taken. |
Sale of Ownership Interests in
Sale of Ownership Interests in Subsidiaries | 9 Months Ended |
Oct. 31, 2020 | |
Notes Payables - IHT Shares of Beneficial Interest and Partnership Units repurchases | |
Sale of Ownership Interests in Subsidiaries | 3. SALE OF OWNERSHIP INTERESTS IN SUBSIDIARIES The Trust has sold non-controlling interests in certain subsidiaries, including Albuquerque Suite Hospitality, LLC (the “Albuquerque entity”) and Tucson Hospitality Properties, LLLP (the “Tucson entity, which sales are described in detail in our Annual Report on Form 10-K filed on August 14, 2020 with the Securities and Exchange Commissions. Generally, interests have sold for $10,000 per unit with a two-unit minimum subscription. The Trust maintains at least 50.1% of the units in one of the entities and intends to maintain this minimum ownership percentage. Generally, the units in the each of the entities are allocated to three classes with differing cumulative discretionary priority distribution rights through a certain time period. Class A units are owned by unrelated third parties and have 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. Priority distributions of $700 per unit per year are cumulative until a certain date; however, after that date, generally Class A unit holders continue to hold a preference on distributions over Class B and Class C unit holders. The Trust does not accrue for these distributions as the preference periods have expired. On February 15, 2017, the Trust and Partnership entered into a restructuring agreement with Rare Earth Financial, LLC (“REF”) to allow for the sale of non-controlling partnership units in Albuquerque Suite Hospitality LLC (“Albuquerque”) for $10,000 per unit, which operates the Best Western InnSuites Albuquerque Hotel and Suites Airport hotel property, a 112 unit hotel in Albuquerque, New Mexico (the “Property”). REF and IHT restructured the Albuquerque 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. REF, as a General Partner of Albuquerque, will coordinate the offering and sale of Class A Interests to qualified third parties. REF and other REF Affiliates may purchase Interests under the offering. This restructuring is part of the Trust’s Equity Enhancement Plan to comply with Section 1003(a)(iii) of the NYSE American Company Guide. |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Oct. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Variable Interest Entities | 4. VARIABLE INTEREST ENTITIES Management evaluates the Trust’s explicit and implicit variable interests to determine if they have any interests in variable interest entities (“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 Albuquerque entity is a variable interest entity 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 Albuquerque hotel. b) The Partnership, Trust and their related parties have maintained, as a group, a controlling ownership interest in the Albuquerque hotel, with the largest ownership belonging to the Trust. c) The Partnership, Trust and their related parties have maintained control over the decisions which most impact the financial performance of the Albuquerque hotel, including providing the personnel to operate the property daily. During the nine months ended October 31, 2020 and the fiscal year ended January 31, 2020, 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 allow our properties to obtain new financing as needed. |
Property, Equipment, and Hotel
Property, Equipment, and Hotel Properties | 9 Months Ended |
Oct. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Property, Equipment, and Hotel Properties | 5. PROPERTY, EQUIPMENT, AND HOTEL PROPERTIES As of October 31, 2020 and January 31, 2020, hotel properties consisted of the following: October 31, 2020 January 31, 2020 Land $ 2,500,000 $ 2,500,000 Building and improvements 10,519,606 10,495,465 Furniture, fixtures and equipment 4,052,067 4,021,890 Total hotel properties 17,071,673 17,017,355 Less accumulated depreciation (8,770,787 ) (8,155,224 ) Hotel Properties in Service, net 8,300,886 8,862,131 Construction in progress 0 40,965 Hotel properties, net $ 8,300,886 $ 8,903,096 As of October 31, 2020 and January 31, 2020, corporate property, plant and equipment consisted of the following: October 31, 2020 January 31, 2020 Land $ 7,005 $ 7,005 Building and improvements 75,662 75,662 Furniture, fixtures and equipment 166,121 160,987 Total property, plant and equipment 248,788 243,654 Less accumulated depreciation (181,873 ) (163,427 ) Property, Plant and Equipment, net $ 66,915 $ 80,227 |
Mortgage Notes Payable
Mortgage Notes Payable | 9 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Mortgage Notes Payable | 6. MORTGAGE NOTES PAYABLE On October 31, 2020 and January 31, 2020, the Trust had a mortgage note payable outstanding with respect to the Tucson Hotel. The mortgage note payable has a scheduled maturity date in June 2042. Weighted average annual interest rates on mortgage notes payable as of October 31, 2020 and January 31, 2020 were 4.69%, respectively. The mortgage note payable reflects a $5.0 million Business Loan Agreement (“Tucson Loan”) as a first mortgage credit facility with KS State Bank, entered into on June 29, 2017, to refinance the existing first mortgage credit facility with an approximate payoff balance of $3.045 million. The loan will allow Tucson Hospitality Properties, LLLP funds for prior and future hotel improvements. The Tucson Loan has a maturity date of June 19, 2042 and 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 October 31, 2020, and January 31, 2020, the Tucson Loan balance was approximately $4,600,000 and $4,709,000, respectively, net of a discount of approximately $5,000. The mortgage note payable is due in monthly installments of $28,493. In addition, the Albuquerque hotel has a loan of approximately $1.4 million with a weighted average interest rate of 4.9%. As of October 31, 2020, and January 31, 2020, the Trust has an affiliate loan with Tempe InnSuites Phoenix Airport for $1 Million. Further detail is out lined in the liquidity section. (This loan was repaid in full in December 2020.) See Note 9 – “Minimum Debt Payments” for scheduled minimum payments on the mortgage notes payable. |
Notes Payable - Related Party
Notes Payable - Related Party | 9 Months Ended |
Oct. 31, 2020 | |
Notes Payable - Related Party | |
Notes Payable - Related Party | 7. NOTES PAYABLE – RELATED PARTY On December 1, 2014, the Trust entered a Demand/Revolving Line of Credit/Promissory Note with Rare Earth Financial, LLC, an entity which is wholly owned by Mr. Wirth and his family members. The Demand/Revolving Line of Credit/Promissory Note, as amended on June 19, 2017, bears interest at 7.0% per annum for both a payable and receivable, is interest only quarterly matures on August 24, 2021, and renews annually each calendar year. No prepayment penalty exists on the Demand/Revolving Line of Credit/Promissory Note. The balance fluctuates significantly through the period. The Demand/Revolving Line of Credit/Promissory Note has a net maximum borrowing/lending capacity of $1,000,000. As of October 31, 2020, and January 31, 2020, the Trust had an amount payable of approximately $35,000 and $0, respectively. During the nine months ended October 31, 2020 and 2019, the Trust accrued approximately $0 of interest expense. |
Other Notes Payable
Other Notes Payable | 9 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Other Notes Payable | 8. OTHER NOTES PAYABLE As of October 31, 2020, the Trust had approximately $136,000 in promissory notes outstanding to unrelated third parties arising from the repurchase of 516,488 Class A Partnership units in privately negotiated transactions, the repurchase of 314,100 Shares of Beneficial Interest in privately negotiated transactions, and the repurchase of 1 Class A interest in Albuquerque Suite Hospitality, LLC in privately negotiated transactions. These promissory notes bear interest at 7% per year and are due in varying monthly payments through January 2023. As of October 31, 2020, the Trust had a $200,000 unsecured note payable with an individual lender. The promissory note is payable on demand, or on June 30, 2021, whichever occurs first. The loan accrues interest at 4.0% and interest only payments shall be made monthly and are due on the first of the following month. The Trust may pay all of part of this note without any repayment penalties. The total principal amount of this loan is $200,000 as of October 31, 2020. On June 20, 2016, the Trust and the Partnership together entered multiple unsecured loans totaling $270,000 with Guy C. Hayden III (“Hayden Loans”). As of July 1, 2019, these loans were consolidated and extended at 4.5% interest only, with similar terms to June 30, 2021. The Trust may pay all or part of this note without any repayment penalties. The total principal amount of the Hayden Loans is $270,000 as of October 31, 2020. On March 20, 2017, the Trust and Partnership entered multiple, unsecured loans to Lisa Sweitzer Hayes (“Sweitzer Loans”), totaling $100,000. As of July 1, 2019, these loans were consolidated and extended at 4.0% interest only, with similar terms to June 30, 2021. The total principal amount of the Sweitzer Loans is $100,000 as of October 31, 2020. As a result of the Covid-19 Virus Pandemic, and the subsequent Legislation passed within the CARES Act of 2020, the Trust applied for and received Small Business Administration (“SBA”) loans through the Paycheck Protection Program (“PPP”). Loans in the amount of $228,602, $187,685, and $86,700, for Tucson, Albuquerque, InnSuites Hospitality, respectively, were granted and received. The lender of all three of the aforementioned PPP Loans has confirmed that all three loans have met all of the requirements necessary to qualify and be eligible for full and complete forgiveness in early 2021, based upon the SBA criteria for PPP loan forgiveness, subject to and pending the forgiveness application. As of March 1, 2021 the InnSuites Hospitality PPP loan ($86,700), has been forgiven. However, to date the other two loans for Tucson ($228,602), and Albuquerque ($187,685), respectively, have not yet been forgiven. See Note 9 – “Minimum Debt Payments” for scheduled minimum payments on the debt liabilities. |
Minimum Debt Payments
Minimum Debt Payments | 9 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Minimum Debt Payments | 9. MINIMUM DEBT PAYMENTS Scheduled minimum payments of debt, net of debt discounts, as of October 31, 2020 are approximately as follows in the respective fiscal years indicated: FISCAL YEAR MORTGAGES OTHER NOTES PAYABLE TOTAL 2021 $ 40,849 $ 638,219 $ 679,068 2022 170,856 554,692 725,548 2023 176,852 14,839 191,691 2024 219,151 219,151 2025 192,828 192,828 2026 203,490 203,490 Thereafter 4,980,873 4,980,873 $ 5,984,899 $ 1,207,750 $ 7,192,649 |
Description of Beneficial Inter
Description of Beneficial Interests | 9 Months Ended |
Oct. 31, 2020 | |
Description Of Beneficial Interests | |
Description of Beneficial Interests | 10. 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. 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, of 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 nine months ended October 31, 2020 and 2019, the Trust repurchased 233,569 and 73,385 Shares of Beneficial Interest at an average price of $1.06 and $1.71 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 711,380 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. |
Related Party Transactions
Related Party Transactions | 9 Months Ended |
Oct. 31, 2020 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | 11. RELATED PARTY TRANSACTIONS As of October 31, 2020 and January 31, 2020, Mr. Wirth and his affiliates held 2,974,038 Class B Partnership units, which represented 20.17% of the total outstanding Partnership units, respectively. As of October 31, 2020 and January 31, 2020, Mr. Wirth and his affiliates held 5,876,683 Shares of Beneficial Interest in the Trust, respectively, which represented 61.38% and 61.32% respectively, of the total issued and outstanding Shares of Beneficial Interest. As of October 31, 2020 and January 31, 2020, the Trust owned 75.89% of the Partnership, respectively. As of October 31, 2020, the Partnership owned a 51.01% interest in the InnSuites® hotel located in Tucson. The Trust also owned a direct 20.17% 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 two Hotels and the hotel owned by affiliates of Mr. Wirth. (This hotel, located in Tempe, Arizona, was sold December 18, 2020). 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 hotel owned by affiliates of Mr. Wirth are set at 5.0% of room revenue and a monthly accounting fee of $2,000 per hotel. 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. For the nine months ended October 31, 2020, the Trust recognized approximately $109,000 of revenue. The Trust employs an immediate family member of Mr. Wirth, Brian James Wirth, who provides technology support services to the Trust, receiving a $36,000 annual salary. On December 22, 2015, the Trust provided Advances to Affiliate – Related Party in the amount of $657,000 to Tempe/Phoenix Airport Resort LLC. Mr. Wirth, individually and thru one of his affiliates owns approximately 42% Tempe/Phoenix Airport Resort LLC. The note was amended on June 17, 2017 to increase the amount to $1,000.000 and extend the due date. The note has a due date of December 31, 2021, renews annually, and accrues interest of 7.0%. During the nine months ended October 31, 2020 and 2019, the Trust received $52,500 and $1,970 of interest income, respectively, from Tempe/Phoenix Airport Resort LLC. As of October 31, 2020, the Advances from Affiliate – Related Party balance was approximately $657,000 from Tempe/Phoenix Airport Resort LLC. (The Tempe hotel was sold, and the inter-company loan was repaid in full in December 2020). On December 1, 2014, the Trust entered into a $1,000,000 net maximum Demand/Revolving Line of Credit/Promissory Note with Rare Earth Financial. The Demand/Revolving Line of Credit/Promissory Note bears interest at 7.0% per annum, is interest only quarterly and matures on June 30, 2021. 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 approximately $35,000 during the nine months ended October 31, 2020. 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 nine months ended October 31, 2020 was $0 of expense and approximately $0 of revenue. |
Statements of Cash Flows, Suppl
Statements of Cash Flows, Supplemental Disclosures | 9 Months Ended |
Oct. 31, 2020 | |
Supplemental Cash Flow Elements [Abstract] | |
Statements of Cash Flows, Supplemental Disclosures | 12. STATEMENTS OF CASH FLOWS, SUPPLEMENTAL DISCLOSURES The Trust paid $182,000 and $372,00 in cash for interest for the nine months ended October 31, 2020 and 2019, respectively for operations. The amounts related to Notes Payables - IHT Shares of Beneficial Interest and Partnership Units repurchases amounted to $130,000 and $124,000, respectively, for the nine months ended October 31, 2020 and 2019. No cash was paid for taxes for the nine months ended October 31, 2020 and 2019. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Oct. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | 13. COMMITMENTS AND CONTINGENCIES 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 as of October 31, 2020 and January 31, 2020, 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 both 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 $97,000 and $125,000 for the nine months ended October 31, 2020 and 2019, respectively. These costs include fees for the Albuquerque and Tucson hotels in 2019. These fees are included in room operating expenses on the unaudited condensed consolidated statements of operations for Albuquerque and Tucson. 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 unaudited condensed 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 unaudited condensed consolidated financial position, results of operations or liquidity. Indemnification: The Trust has entered into indemnification agreements with all 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 the Trust’s best interests. These agreements require the Trust, 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. The Trust 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, the Trust has not incurred any payments for these obligations and, therefore, no liabilities have been recorded for these indemnities in the accompanying consolidated balance sheets. See Note 14 – Leases, for discussion on lease payment commitments. |
Leases
Leases | 9 Months Ended |
Oct. 31, 2020 | |
Leases [Abstract] | |
Leases | 14. LEASES The Company has operating leases and finance lease for its corporate offices in Phoenix, Arizona, and land leased in Albuquerque, New Mexico. The Company’s lease terms include options to extend or terminate the leases and the Company includes these options in the lease term when it is reasonably certain to exercise that option. Operating Leases 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. The Company’s 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. The following table presents the Company’s lease costs for the nine months ended October 31, 2020: Nine Months Ended 31-Oct-20 Operating Lease Costs: Operating lease cost* $ 150,260 * Short term lease costs were immaterial. Supplemental cash flow information is as follows: Nine Months Ended 31-Oct-20 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 126,102 Lease Obligations obtained: Operating leases, net $ 2,383,120 Long-term obligations $ 2,326,160 Weighted average remaining lease terms and discount rates were as follows: Weighted average remaining lease term (years) October 31, 2020 Operating leases 37 Weighted average discount rate Operating leases 4.85 % The aggregate future lease payments for Operating Lease Liability as of October 31, 2020 are as follows: For the Years Ending January 31, Remaining in 2021 $ 42,678 2022 172,177 2023 148,348 2024 112,116 2025 112,116 Thereafter 5,151,311 Total minimum lease payments $ 5,738,746 Less: amount representing interest 3,355,626 Total present value of minimum payments 2,383,120 Less: current portion of operating lease liability $ 56,960 Long term portion of operating lease liability 2,326,160 Finance Leases The Company’s Tucson Oracle Hotel is subject to non-cancelable cable lease. The Tucson Oracle Hotel non-cancelable cable lease expires in 2023. The following table presents the Company’s lease costs for the nine months ended October 31, 2020: Nine Months Ended 31-Oct-20 Finance Lease Costs: Amortization of lease obligations $ 20,811 Interest on lease obligations 3,557 Supplemental cash flow information is as follows: Nine Months Ended 31-Oct-20 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 25,936 Lease Obligations obtained: Finance leases, net $ 86,732 Long-term obligations $ 59,209 Weighted average remaining lease terms and discount rates were as follows: Weighted average remaining lease term (years) October 31, 2020 Finance leases 3 Weighted average discount rate Finance leases 4.85 % The aggregate future lease payments for Finance Lease Liability as of October 31, 2020 are as follows: For the Years Ending January 31, Remaining in 2021 $ 7,781 2022 31,123 2023 31,123 2024 23,343 Total minimum lease payments $ 93,370 Less: amount representing interest 6,638 Total present value of minimum payments 86,732 Less: current portion $ 27,523 Long term portion of finance lease liability 59,209 |
Share-Based Payments
Share-Based Payments | 9 Months Ended |
Oct. 31, 2020 | |
Equity [Abstract] | |
Share-Based Payments | 15. SHARE-BASED PAYMENTS The Trust compensates its three non-employee Trustees for their services through grants of restricted Shares. The aggregate grant date fair value of these Shares was $32,400. These restricted 18,000 shares, (6,000 each to the three Independent Trustees), vest in equal monthly amounts during fiscal year 2021. 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 during the nine months ended October 31, 2020, and no options were outstanding as of that period end. The Plan currently has 1,000,000 options available to grant. See Note 17 for additional information on stock options. The Plan also permits the Trust to award stock appreciation rights, none of which, as of October 31, 2020, have been issued. See Note 2 – “Summary of Significant Accounting Policies” for information related to grants of restricted shares under “Stock-Based Compensation.” |
Notes Receivable
Notes Receivable | 9 Months Ended |
Oct. 31, 2020 | |
Priority return payments | |
Notes Receivable | 16. NOTES RECEIVEABLE Sale of IBC Hospitality Technologies; IBC Hotels LLC (IBC) On August 15, 2018, the Trust entered into a final sale agreement for its subsidiary IBC Hotels LLC (IBC) with an effective sale date as of August 1, 2018 to an unrelated third-party buyer (Buyer). The sale price was $3,000,000, to be paid to IHT as follows: 1. $250,000 at closing, which was received in cash on August 14, 2018; 2. A secured promissory note receivable in the principal amount of $2,750,000 with interest to be accrued at 3.75% per annum, recorded in the accompanying condensed balance sheet in continuing operations, with maturity on June 1, 2024. Future receipts from this note are shown in the table below. FISCAL YEAR 2021 - 2022 550,000 2023 550,000 2024 825,000 $ 1,925,500 As of January 31, 2020, the Trust evaluated the carrying value of the note of $2,750,00 for potential impairment. After review, an impairment of $825,000, or 30%, was taken against the note. Factors for the impairment included, but were not limited to: ● Management’s evaluation of the current financial position of the Buyer, based on unaudited financial statements provided. ● A lack of substantial quantitative data, showing the impact of the recently executed digital advertising agreement between the Buyer and Google. ● Management’s best, conservative valuation of IBC’s assets, and their marketability, in the case of a default by the Buyer. ● The current and future impact of the COVID-19 pandemic, on the travel and hospitality industry, in which IBC’s reservation and booking technology operates. As of October 31, 2020, management evaluated the carrying value of the note and the impairment taken to date and determined no further impairment is needed at this time. The start date of the monthly payments was originally to commence in 2020 but was extended to November 2021 due to the Virus slowing down the economy in general, and the travel industry specifically. The Trust has evaluated the ongoing pandemic conditions and no impairment is deemed necessary as the travel industry is expected to fully recover by Q3 2021. The note is secured by (1) pledge of the Buyer’s interest in IBC, and (2) a security interest in all assets of IBC provided IHT shall agree to subordinate such equity interest to commercially reasonable debt financing upon request. If after effective date IBC closes an equity transaction with net proceeds to IBC in excess of $2,500,000, IBC/Buyer shall pay to IHT an amount equal to (a) 50% of the net proceeds received by IBC and (b) 50% of the sum of the unpaid balance of the note and accrued interest accrued but unpaid interest thereon, as the date of receipt of the net proceeds by IBC. IHT agreed to provide continuing working capital support for a period of nine months in the amount of approximately $225,000 over a six-month period to IBC for transitional purposes. IHT has no managerial control nor does IHT have the ability to direct the operations or capital requirements of IBC as of August 1, 2018. IHT has no rights to any benefits or losses from IBC as of August 1, 2018. During the fiscal year ended January 31, 2019 IHT had provided $100,000 to IBC. During the fiscal year ended January 31, 2020, IHT provided $125,000. Furthermore, no support was provided in the third quarter ended October 31, 2020. Default If Buyer has not paid two or more payments on the note as scheduled, or if Buyer has not satisfied any other provisions in the note, IHT may give Buyer notice of default. If Buyer fails to cure the default within 30 days after notice (a) on or before February 5, 2021, then 75% of the issued and outstanding IBC interest shall be transferred to IHT, and (b) on or after February 5, 2021, then 51% of the issued and outstanding interest of the Company shall be transferred to IHT. Currently there has been no default due to the extension granted. |
Stock Options
Stock Options | 9 Months Ended |
Oct. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Stock Options | 17. 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. |
Income and Occupancy Taxes
Income and Occupancy Taxes | 9 Months Ended |
Oct. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income and Occupancy Taxes | 18. INCOME AND OCCUPANCY TAXES The Trust is taxed as a C-Corporation. The Trust’s practice is to recognize interest and/or penalties related to income tax matters in income tax expense. The Trust has received various IRS and state tax jurisdiction notices which the Trust in the process of responding to in which management believes the notices are without merit and expect full remediation of all tax notices. The Trust and subsidiaries have deferred tax assets of $4.0 million which includes cumulative net operating loss carryforwards of $1.1 million and syndications of $2.9 million, and deferred tax liability associated with book/tax differences of $1.5 million as of October 31, 2020. We have evaluated the net deferred tax asset and determined that it is not more likely than not we will receive full benefit from the net operating loss carryforwards. Therefore, we have determined a valuation allowance of approximately $2.5 million. Sales and occupancy tax expense was approximately $844,000 and $78,000 due to penalties and interest for the nine and three months ended October 31, 2020, respectively. This liability arose from an occupancy tax discrepancy generated from our Albuquerque hotel. While filing our monthly return, the Trust discovered additional amounts owed under our Sales and Occupancy Account. We were subsequently notified in March 2021 of a potential underreporting and/or under collecting of occupancy tax. We were not aware of any previous notices being sent. To further complicate the situation, our filing position was such that we did not believe or know we were liable for any other tax, other than the amounts declared and filed for the periods in question. Thus we believed all of our previously filed monthly returns were originally correct as filed. We are currently in discussions with the New Mexico Taxation and Revenue Department to resolve these issues. These additional amounts due for Hotel sales and occupancy expenses are not expected to be recurring, since the Trust collects and remits all necessary occupancy taxes to the state monthly. No additional assessments have been made since September 2020. |
COVID-19 Disclosure
COVID-19 Disclosure | 9 Months Ended |
Oct. 31, 2020 | |
Unusual or Infrequent Items, or Both [Abstract] | |
COVID-19 Disclosure | 19. COVID-19 DISCLOSURE COVID-19 has had a material detrimental impact on our business, financial results and liquidity, and such impact could worsen and last for an unknown period of time. The global spread of COVID-19 has been and continues to be a complex and rapidly evolving situation, with governments, public institutions and other organizations imposing or recommending, and business and individuals implementing, at various times and to varying degrees, restrictions on various activities or other actions to combat its spread, such as restrictions and bans on travel or transportation, limitations on the size of gatherings, closures of or occupancy or other operating limitations on work facilities, schools, public buildings and business, cancellation of events, including sporting events, conferences and meetings, and quarantines and lock-downs. COVID-19 and its consequences have dramatically reduced travel and demand for hotel rooms, which has and will continue to impact our business, operations, and financial results. We believe that it will be some time before lodging demand and revenue levels recover and such recovery could vary across markets or regions around the world. The extent to which COVID-19 impacts our business, operations, and financial results, including the duration and magnitude of such effects, will depend on numerous evolving factors that we may not be able to accurately predict or assess, including the duration and scope of COVID-19 (including the location and extent of resurgences of the virus and the availability of effective treatments or vaccines); the negative impact COVID-19 has on global and regional economies and economic activity, including the duration and magnitude of its impact on unemployment rates and consumer discretionary spending; its short and longer-term impact on the demand for travel, transient and group business; and levels of consumer confidence. With three COVID-19 vaccines now available as of March 2021 Management is of the opinion that the detrimental effects of the Virus will slow because the likelihood of it continuing to spread should now diminish considerably throughout the coming year. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Oct. 31, 2020 | |
Subsequent Events [Abstract] | |
Subsequent Events | 20. SUBSEQUENT EVENTS Management expects but cannot guarantee the PPP Loans received by IHT, as well as the Tucson and Albuquerque hotels, because of the Covid-19 Virus Pandemic, to be fully forgiven, based upon SBA guidelines. Furthermore, IHT has received preliminary approval of forgiveness from the lender on December 1, 2020. The approval is contingent on SBA approval. The PPP Loans received by IHT and the Tucson Hotel have both been officially forgiven, in the amounts of $86,937 and $228,602, respectively. The approval process could take up to 90 days or longer, to March 31, 2021, for the remaining Albuquerque Hotel loan forgiveness of approximately $188,000. On March 5, 2021, the Albuquerque hotel received another PPP Loan in the amount of $253,253. On March 15, 2021, the Tucson hotel received an additional PPP Loan in the amount of $297,601. Management expects but cannot guarantee these additional PPP Loans received by the Tucson and Albuquerque hotels, because of the Covid-19 Virus Pandemic, to be fully forgiven, based upon SBA guidelines. On November 20, 2020, the Trust extended a $500,000 line of credit to UPI at an annual interest rate of 6%. The maturity date of the line of credit is December 31, 2024. Certain terms of the line of credit agreement are met, so the Trust will be granted 300,000 common stock warrants of UPI with an exercise price of $2.25 per share. As of March 16, 2021, UniGen has not drawn any funds and under the terms may not draw any funds; however IHT may at its sole discretion fund up to $500,000 and convert this into UniGen stock at $1.00 per share. An affiliate of the Trust sold the Tempe Hotel on December 18, 2020. The Trust has received the full repayment of the approximately $1 million intercompany loan to Tempe. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 9 Months Ended |
Oct. 31, 2020 | |
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 unaudited condensed 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, virus/pandemic, 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, Equipment, and Hotel Properties | PROPERTY, EQUIPMENT, AND HOTEL PROPERTIES Furniture, fixtures, building and improvements and hotel properties are stated at cost, except for land, and depreciated using the straight-line method over estimated lives ranging up to 40 years for buildings and improvements, and 3 to 10 years for furniture, fixtures and equipment. Land is an indefinite-lived asset. The Trust tests its land for impairment annually, or whenever events or changes in circumstances indicates an impairment may have occurred, by comparing its carrying value to its implied fair value. For tax purposes the Trust may take advantage of accelerated depreciation methods (MACRS) for new capital additions and improvements to its Hotels. 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, or not, 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. |
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. |
Short-Term Investments - Available for Sale Securities | SHORT-TERM INVESTMENTS – AVAILABLE FOR SALE SECURITIES The Trust currently holds a liquid investment account with Charles Schwab. The Trust believes it places its investments only with high credit quality financial institutions. |
Revenue Recognition | REVENUE RECOGNITION Hotel and Operations ASU 2014-09 (Topic 606), “Revenue from Contracts with Customers” is effective for reporting periods beginning after December 15, 2017. 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. Revenues are primarily derived from the sources below and are recognized as services are rendered and when collectability is reasonably assured. Amounts received in advance of revenue recognition are considered deferred liabilities and are generally not significant. 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. Each room night consumed by a guest with a cancellable reservation represents a contract whereby the Trust has a performance obligation to provide the room night at an agreed upon price. For cancellable reservations, the Trust recognizes revenue as each performance obligation (i.e., each room night) is met. Such contract is renewed if the guest continues their stay. For room nights consumed by a guest with a non-cancellable reservation, the entire reservation period represents the contract term whereby the Trust has a performance obligation to provide the room night or nights at an agreed upon price. For non-cancellable reservations, the Trust recognizes revenue over the term of the performance period (i.e., the reservation period) as room nights are consumed. For these reservations, the room rate is typically fixed over the reservation period. The Trust uses an output method based on performance completed to date (i.e., room nights consumed) to determine the amount of revenue it recognizes on a daily basis if the length of a non-cancellable reservation exceeds one night since consumption of room nights indicates when services are transferred to the guest. In certain instances, variable consideration may exist with respect to the transaction price, such as discounts, coupons and price concessions made upon guest checkout. In evaluating its performance obligation, the Trust bundles the obligation to provide the guest the room itself with other obligations (such as free Wi-Fi, grab and go breakfast, access to on-site laundry facilities and parking), as the other obligations are not distinct and separable because the guest cannot benefit from the additional amenities without the consumed room night. The Trust’s obligation to provide the additional items or services is not separately identifiable from the fundamental contractual obligation (i.e., providing the room and its contents). The Trust has no performance obligations once a guest’s stay is complete. 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. |
Accounts Receivables and Allowance for Doubtful Accounts | ACCOUNTS RECEIVABLES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS Accounts receivable are derived from guest stays and other reservations at the Hotels. 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 due and 100% of balances over 120 days due. 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 three months ended October 31, 2020 and the fiscal year ended January 31, 2020. Fiscal Year Balance at the Discontinued Charged to Deductions Balance at October 31, 2020 $ (14,789 ) $ - $ (6,933 ) $ - $ (21,722 ) January 31, 2020 $ (5,943 ) $ - $ (13,223 ) $ 4,377 $ (14,789 ) |
Income Tax Receivable | INCOME TAX RECEIVABLE The Trust amended its corporate tax returns for the previous year ended January 31, 2019. Such amendments resulted in a refund of approximately $294,000, of which the Trust received approximately $175,000 in August 2020. The Trust expects to receive the remaining $120,000 by July 31, 2021. |
Lease Accounting | LEASE ACCOUNTING The Trust determines, at the inception of a contract, if the arrangement is a lease and whether it meets the classification criteria for a finance or operating lease. ROU assets represent the Trust’s right to use an underlying asset during the lease term and lease liabilities represent the Trust’s obligation to make lease payments arising from the lease. ROU assets and lease liabilities are recognized at commencement date based on the present value of fixed lease payments over the lease term. ROU assets also include any advance lease payments and exclude lease incentives. As most of the Trust’s operating leases do not provide an implicit rate, the Trust uses its incremental borrowing rate based on information available at commencement date in determining the present value of lease payments. Finance lease agreements generally include an interest rate that is used to determine the present value of future lease payments. Operating fixed lease expense and finance lease depreciation expense are recognized on a straight-line basis over the lease term (see Note 14). |
Trustee Stock-based Compensation | TRUSTEE STOCK-BASED COMPENSATION The Trust has an employee equity incentive plan, which is described more fully in Note 15 - “Share-Based Payments.” The three independent members of the Board of Trustees earn 6,000 IHT Shares per year. The Trust has paid the annual fees due to its Trustees by issuing Shares of Beneficial Interest out of its authorized but unissued Shares. 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 the nine months ended October 31, 2020, the Trust granted restricted stock awards of 18,000 Shares to three independent members of the Board of Trustees, resulting in stock-based compensation of $21,600. The shares vest over one year, through the end of fiscal year ended January 31, 2021 monthly at a rate of approximately 500 shares for each outside Trustee or a total of 1,500 per month for three independent Trustees. |
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. |
Net Loss Per Share | NET LOSS PER SHARE Basic and diluted net 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 3,185,746 Shares of the Beneficial Interest, as discussed in Note 1. For the nine months ended October 31, 2020 and 2019, 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 3,185,746 in addition to the basic shares outstanding for the nine months ended October 31, 2020 and 2019. These Shares of Beneficial Interest issuable upon conversion of the Class A and Class B Partnership units were anti-dilutive during the nine months ended October 31, 2020 and 2019 and are excluded in the calculation of diluted earnings per share for those periods. |
Advertising Costs | ADVERTISING COSTS Amounts incurred for advertising costs are expensed as incurred. Advertising expense for continuing operations totaled approximately $39,000 and $59,000 for the three months ended October 31, 2020 and 2019 respectively, and $154,000 and $233,000 for the nine months ended October 31, 2020 and 2019, 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 assets that are carried at fair value on a recurring basis, including warrants in a 3 rd 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. |
Investment in Unigen Power, Inc. | INVESTMENT IN UNIGEN POWER, INC. On December 16, 2019, the Trust entered into a Convertible Debenture Purchase Agreement with UniGen Power Inc. (“UPI” or “UniGen”). The Trust purchased secured convertible debentures (“Debentures”) in the aggregate amount of $1,000,000 (the “Loan Amount”) (the “Loan”) at an annual interest rate of 6%. The Debentures are convertible into Class A shares of UniGen Common Stock at an initial conversion rate of $1.00 per share. The Loan is structured into two (2) payments of $600,000 and $400,000. The first payment of $600,000 was made by the Trust at closing on December 16, 2019 and the second payment of $400,000 was made on February 3, 2020. UniGen issued the Trust common stock purchase warrants (the “Debenture Warrants”) to purchase up to 1,000,000 shares of Class A Common Stock (600,000 issued on January 31, 2020, and 400,000 issued on February 3, 2020). The Debenture Warrants are exercisable at an exercise price of $1.00 per share of Class A Common Stock. UniGen, also, issued the Trust additional common stock purchase warrants (“Additional Warrants”) to purchase up to 200,000 shares of Class A Common Stock (120,000 issued at January 31, 2020, and 80,000 issued on February 3, 2020). The Additional Warrants are exercisable at an exercise price of $2.25 per share of Class A Common Stock. On the Trust’s balance sheet, the investment of the $1,030,000 made in the current fiscal year consists of approximately $424,000 in note receivables, approximately $576,000 as the fair value of the warrant issued with the Trust’s investment in UniGen, and $30,000 in accrued interest income, which was re-invested in Unigen. The value of the premium related to the fair value of the warrants will accrete over the life of the debentures. The value of the warrants was based on Black-Scholes pricing model based on the following inputs: Debenture Warrants Type of option Call option Stock price $ 2.25 Exercise (Strike) price $ 1.00 Time to maturity (years) 2.0 Annualized risk-free rate 1.630 % Annualized volatility 27.43 % Additional Warrants Type of option Call option Stock price $ 2.25 Exercise (Strike) price $ 2.25 Time to maturity (years) 2.0 Annualized risk-free rate 1.630 % Annualized volatility 27.43 % |
Unigen Subsequent Event | UNIGEN SUBSEQUENT EVENT UniGen has also agreed to allow IHT to fund a $500,000 line of credit at the option of IHT convertible into 500,000 shares of UniGen stock at $1 per share. And upon full subscription of the UniGen $2 million syndication, IHT will be granted an additional 300,000 warrants at $2.25 per share. If all notes are converted and all warrants exercised, IHT would hold 3 million UniGen shares out of a total of approximately 12 million UniGen shares resulting in IHT owning approximately 25% of UniGen. Subsequent to October 31, 2020, no activity has occurred with this line of credit and thus no draws have been taken. |
Nature of Operations and Basi_2
Nature of Operations and Basis of Presentation (Tables) | 9 Months Ended |
Oct. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Entity Ownership Percentage | . 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 20.17 % - Tucson Hospitality Properties, LLLP - 51.01 % RRF Limited Partnership 75.89 % - InnSuites Hotels Inc. 100.00 % - (i) Indirect ownership is through the Partnership |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 9 Months Ended |
Oct. 31, 2020 | |
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 three months ended October 31, 2020 and the fiscal year ended January 31, 2020. Fiscal Year Balance at the Discontinued Charged to Deductions Balance at October 31, 2020 $ (14,789 ) $ - $ (6,933 ) $ - $ (21,722 ) January 31, 2020 $ (5,943 ) $ - $ (13,223 ) $ 4,377 $ (14,789 ) |
Schedule of Warrants Based on Black-Scholes Pricing Model | The value of the warrants was based on Black-Scholes pricing model based on the following inputs: Debenture Warrants Type of option Call option Stock price $ 2.25 Exercise (Strike) price $ 1.00 Time to maturity (years) 2.0 Annualized risk-free rate 1.630 % Annualized volatility 27.43 % Additional Warrants Type of option Call option Stock price $ 2.25 Exercise (Strike) price $ 2.25 Time to maturity (years) 2.0 Annualized risk-free rate 1.630 % Annualized volatility 27.43 % |
Property, Equipment, and Hote_2
Property, Equipment, and Hotel Properties (Tables) | 9 Months Ended |
Oct. 31, 2020 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Property, Equipment, and Hotel Properties | As of October 31, 2020 and January 31, 2020, hotel properties consisted of the following: October 31, 2020 January 31, 2020 Land $ 2,500,000 $ 2,500,000 Building and improvements 10,519,606 10,495,465 Furniture, fixtures and equipment 4,052,067 4,021,890 Total hotel properties 17,071,673 17,017,355 Less accumulated depreciation (8,770,787 ) (8,155,224 ) Hotel Properties in Service, net 8,300,886 8,862,131 Construction in progress 0 40,965 Hotel properties, net $ 8,300,886 $ 8,903,096 As of October 31, 2020 and January 31, 2020, corporate property, plant and equipment consisted of the following: October 31, 2020 January 31, 2020 Land $ 7,005 $ 7,005 Building and improvements 75,662 75,662 Furniture, fixtures and equipment 166,121 160,987 Total property, plant and equipment 248,788 243,654 Less accumulated depreciation (181,873 ) (163,427 ) Property, Plant and Equipment, net $ 66,915 $ 80,227 |
Minimum Debt Payments (Tables)
Minimum Debt Payments (Tables) | 9 Months Ended |
Oct. 31, 2020 | |
Debt Disclosure [Abstract] | |
Scheduled of Minimum Payments of Debt | Scheduled minimum payments of debt, net of debt discounts, as of October 31, 2020 are approximately as follows in the respective fiscal years indicated: FISCAL YEAR MORTGAGES OTHER NOTES PAYABLE TOTAL 2021 $ 40,849 $ 638,219 $ 679,068 2022 170,856 554,692 725,548 2023 176,852 14,839 191,691 2024 219,151 219,151 2025 192,828 192,828 2026 203,490 203,490 Thereafter 4,980,873 4,980,873 $ 5,984,899 $ 1,207,750 $ 7,192,649 |
Leases (Tables)
Leases (Tables) | 9 Months Ended |
Oct. 31, 2020 | |
Operating Leases [Member] | |
Schedule of Lease Costs | The following table presents the Company’s lease costs for the nine months ended October 31, 2020: Nine Months Ended 31-Oct-20 Operating Lease Costs: Operating lease cost* $ 150,260 * Short term lease costs were immaterial. |
Schedule of Cash Flow Information | Supplemental cash flow information is as follows: Nine Months Ended 31-Oct-20 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases $ 126,102 Lease Obligations obtained: Operating leases, net $ 2,383,120 Long-term obligations $ 2,326,160 |
Schedule of Weighted Average Remaining Lease Terms and Discount Rates | Weighted average remaining lease terms and discount rates were as follows: Weighted average remaining lease term (years) October 31, 2020 Operating leases 37 Weighted average discount rate Operating leases 4.85 % |
Schedule of Future Minimum Rental Payments for Operating Lease and Finance Lease | The aggregate future lease payments for Operating Lease Liability as of October 31, 2020 are as follows: For the Years Ending January 31, Remaining in 2021 $ 42,678 2022 172,177 2023 148,348 2024 112,116 2025 112,116 Thereafter 5,151,311 Total minimum lease payments $ 5,738,746 Less: amount representing interest 3,355,626 Total present value of minimum payments 2,383,120 Less: current portion of operating lease liability $ 56,960 Long term portion of operating lease liability 2,326,160 |
Finance Leases [Member] | |
Schedule of Lease Costs | The following table presents the Company’s lease costs for the nine months ended October 31, 2020: Nine Months Ended 31-Oct-20 Finance Lease Costs: Amortization of lease obligations $ 20,811 Interest on lease obligations 3,557 |
Schedule of Cash Flow Information | Supplemental cash flow information is as follows: Nine Months Ended 31-Oct-20 Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases $ 25,936 Lease Obligations obtained: Finance leases, net $ 86,732 Long-term obligations $ 59,209 |
Schedule of Weighted Average Remaining Lease Terms and Discount Rates | Weighted average remaining lease terms and discount rates were as follows: Weighted average remaining lease term (years) October 31, 2020 Finance leases 3 Weighted average discount rate Finance leases 4.85 % |
Schedule of Future Minimum Rental Payments for Operating Lease and Finance Lease | The aggregate future lease payments for Finance Lease Liability as of October 31, 2020 are as follows: For the Years Ending January 31, Remaining in 2021 $ 7,781 2022 31,123 2023 31,123 2024 23,343 Total minimum lease payments $ 93,370 Less: amount representing interest 6,638 Total present value of minimum payments 86,732 Less: current portion $ 27,523 Long term portion of finance lease liability 59,209 |
Notes Receivable (Tables)
Notes Receivable (Tables) | 9 Months Ended |
Oct. 31, 2020 | |
Priority return payments | |
Schedule of Future Payments of Debt | FISCAL YEAR 2021 - 2022 550,000 2023 550,000 2024 825,000 $ 1,925,500 |
Nature of Operations and Basi_3
Nature of Operations and Basis of Presentation (Details Narrative) | Dec. 18, 2020USD ($) | Oct. 31, 2020USD ($)Integershares | Oct. 31, 2019 | Jan. 31, 2020USD ($)shares | Feb. 02, 2019USD ($) |
Number of hotels | Integer | 2 | ||||
Number of suites | Integer | 270 | ||||
Debt instrument interest rate | 7.00% | ||||
Cash | $ 47,000 | ||||
Line of credit availability combined | 1,000,000 | ||||
Advances to affiliates | 1,000,000 | ||||
Operating right of use assets | 2,162,331 | $ 2,197,364 | |||
Operating lease liabilities | 2,383,120 | ||||
Accounting Standards Update 2016-02 [Member] | |||||
Operating right of use assets | $ 2,821,410 | ||||
Operating lease liabilities | $ 2,913,568 | ||||
Related Party Demand/Revolving Line of Credit/Promissory Note [Member] | |||||
Line of credit amount | 35,000 | ||||
Line of credit limit | 1,000,000 | ||||
Line of credit remaining borrowing capacity | 0 | ||||
Advances to Affiliate [Member] | |||||
Line of credit amount | 657,000 | ||||
Advances to Affiliate [Member] | December 31, 2021 [Member] | |||||
Line of credit limit | $ 1,000,000 | ||||
Class A Partnership Units [Member] | |||||
Partnership unit issued | shares | 211,708 | 211,708 | |||
Partnership unit outstanding | shares | 211,708 | 211,708 | |||
General Partner Units [Member] | |||||
Number of partnership units | shares | 10,025,771 | 10,025,771 | |||
Innsuites Hotel Located in Albuquerque New Mexico [Member] | |||||
Partnership ownership interest percentage | 20.17% | ||||
Class A Partnership Units [Member] | |||||
Percentage of total partnership units | 1.60% | 1.60% | |||
General Partner Units [Member] | |||||
Partnership ownership interest percentage | 75.89% | 75.89% | |||
RRF Limited Partnership [Member] | Innsuites Hotel Located in Tucson, Arizona [Member] | |||||
Partnership ownership interest percentage | 51.01% | ||||
James Wirth [Member] | Class B Partnership Units [Member] | |||||
Partnership unit outstanding | shares | 2,974,038 | 2,974,038 | |||
Republic Bank of Arizona [Member] | |||||
Line of credit amount | $ 150,000 | ||||
Limited Partner [Member] | |||||
Number of partnership units | shares | 3,185,746 | 3,185,746 | |||
UniGen Power Inc. [Member] | |||||
Convertible debenture | $ 1,000,000 | ||||
Debt instrument interest rate | 6.00% | ||||
RRF Limited Partnership [Member] | Weighted Average [Member] | |||||
Percentage of ownership interest held by the trust | 75.89% | 75.89% | |||
RRF Limited Partnership [Member] | General Partner [Member] | |||||
Percentage of ownership interest held by the trust | 75.89% | 75.89% | |||
Tempe Hotel [Member] | Subsequent Event [Member] | |||||
Repayment of loan | $ 657,000 |
Nature of Operations and Basi_4
Nature of Operations and Basis of Presentation - Schedule of Entity Ownership Percentage (Details) | Oct. 31, 2020 | |
Albuquerque Suite Hospitality, LLC [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 20.17% | |
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] |
RRF Limited Partnership [Member] | Direct Ownership [Member] | ||
IHT OWNERSHIP % | 75.89% | |
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] |
[1] | Indirect ownership is through the Partnership |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | Mar. 16, 2021 | Jan. 31, 2021 | Dec. 16, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Aug. 31, 2020 | Feb. 03, 2020 | Jan. 31, 2020 |
Corporate tax returns | $ 294,000 | $ 294,000 | $ 175,000 | |||||||
Expected future corporate tax returns | 120,000 | 120,000 | ||||||||
Stock-based compensation | $ 21,600 | $ 24,300 | ||||||||
Aggregate weighted average shares of beneficial for units of partnership | 3,185,746 | 3,185,746 | ||||||||
Weighted average incremental shares resulting from unit conversion | 3,185,746 | 3,185,746 | ||||||||
Advertising expense for continuing operation | $ 39,000 | $ 59,000 | $ 154,000 | $ 233,000 | ||||||
Debt instrument interest rate | 7.00% | 7.00% | ||||||||
Investments | $ 1,030,000 | $ 1,030,000 | $ 600,000 | |||||||
Accrued interest income | $ 17,500 | $ 62,225 | $ 81,852 | $ 65,752 | ||||||
Debenture Warrants [Member] | ||||||||||
Warrants exercise price | $ 1 | $ 1 | ||||||||
Additional Warrants [Member] | ||||||||||
Warrants exercise price | $ 2.25 | $ 2.25 | ||||||||
UniGen Power Inc. [Member] | ||||||||||
Debt instrument interest rate | 6.00% | 6.00% | ||||||||
Investments | $ 1,030,000 | $ 1,030,000 | ||||||||
Notes receivable | $ 424,000 | 424,000 | ||||||||
Fair value of warrants | 576,000 | |||||||||
Accrued interest income | $ 30,000 | |||||||||
UniGen Power Inc. [Member] | Debenture Warrants [Member] | Class A Common Stock [Member] | ||||||||||
Number of warrants to purchase common stock | 1,000,000 | 400,000 | 600,000 | |||||||
Warrants exercise price | $ 1 | |||||||||
UniGen Power Inc. [Member] | Additional Warrants [Member] | Class A Common Stock [Member] | ||||||||||
Number of warrants to purchase common stock | 200,000 | 80,000 | 120,000 | |||||||
Warrants exercise price | $ 2.25 | |||||||||
Convertible Debenture Purchase Agreement [Member] | UniGen Power Inc. [Member] | ||||||||||
Payments on secured convertible debentures | $ 1,000,000 | |||||||||
Debt instrument interest rate | 6.00% | |||||||||
Debt instrument, conversion price per share | $ 1 | |||||||||
Convertible Debenture Purchase Agreement [Member] | UniGen Power Inc. [Member] | December 16, 2019 [Member] | ||||||||||
Payments on secured convertible debentures | $ 600,000 | |||||||||
Convertible Debenture Purchase Agreement [Member] | UniGen Power Inc. [Member] | February 3, 2020 [Member] | ||||||||||
Payments on secured convertible debentures | $ 400,000 | |||||||||
Subsequent Event [Member] | UniGen Power Inc. [Member] | ||||||||||
Debt instrument, conversion price per share | $ 1 | |||||||||
Line of credit, funded value | $ 500,000 | |||||||||
Number of options convertible into shares | 500,000 | |||||||||
Subscription of shares and warrants, description | Upon full subscription of the UniGen $2 million syndication, IHT will be granted an additional 300,000 warrants at $2.25 per share. If all notes are converted and all warrants exercised, IHT would hold 3 million UniGen shares out of a total of approximately 12 million UniGen shares resulting in IHT owning approximately 25% of UniGen. | |||||||||
Three Independent Members [Member] | ||||||||||
Stock issued during period share-based compensation, shares | 6,000 | |||||||||
Three Independent Trustees [Member] | Subsequent Event [Member] | ||||||||||
Vested shares | 500 | |||||||||
Vested shares, value | $ 1,500 | |||||||||
90 days [Member] | ||||||||||
Percentage of allowance for doubtful accounts | 50.00% | |||||||||
120 days [Member] | ||||||||||
Percentage of allowance for doubtful accounts | 100.00% | |||||||||
Restricted Stock [Member] | Three Independent Members [Member] | ||||||||||
Stock issued during period share-based compensation, shares | 18,000 | |||||||||
Building and Improvements [Member] | Maximum [Member] | ||||||||||
Property, plant and equipment, useful life | 40 years | |||||||||
Furniture, Fixtures and Equipment [Member] | Maximum [Member] | ||||||||||
Property, plant and equipment, useful life | 10 years | |||||||||
Furniture, Fixtures and Equipment [Member] | Minimum [Member] | ||||||||||
Property, plant and equipment, useful life | 3 years |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Schedule of Accounts Receivable and Allowance for Doubtful Accounts (Details) - USD ($) | 9 Months Ended | 12 Months Ended |
Oct. 31, 2020 | Jan. 31, 2020 | |
Accounting Policies [Abstract] | ||
Beginning Balance | $ (14,789) | $ (5,943) |
Discontinued Operations Adjustment | ||
Charged to Expense | (6,933) | (13,223) |
Deductions | 4,377 | |
Ending Balance | $ (21,722) | $ (14,789) |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Schedule of Warrants Based on Black-Scholes Pricing Model (Details) | Oct. 31, 2020$ / shares |
Debenture Warrants [Member] | |
Stock price | $ 2.25 |
Exercise (Strike) price | $ 1 |
Time to maturity (years) | 2 years |
Debenture Warrants [Member] | Annualized Risk-free Rate [Member] | |
Fair value of warrants measurement input, percentage | 1.630 |
Debenture Warrants [Member] | Annualized Volatility [Member] | |
Fair value of warrants measurement input, percentage | 27.43 |
Additional Warrants [Member] | |
Stock price | $ 2.25 |
Exercise (Strike) price | $ 2.25 |
Time to maturity (years) | 2 years |
Additional Warrants [Member] | Annualized Risk-free Rate [Member] | |
Fair value of warrants measurement input, percentage | 1.630 |
Additional Warrants [Member] | Annualized Volatility [Member] | |
Fair value of warrants measurement input, percentage | 27.43 |
Sale of Ownership Interests i_2
Sale of Ownership Interests in Subsidiaries (Details Narrative) - $ / shares | Feb. 15, 2017 | Oct. 31, 2020 | Feb. 14, 2017 |
Class A [Member] | |||
Number of units sold during period | 250 | ||
Class B [Member] | |||
Number of units sold during period | 200 | ||
Albuquerque [Member] | Class A, Class B and Class C [Member] | |||
Limited liability limited partnership interests | 600 | 550 | |
Albuquerque Suite Hospitality, LLC [Member] | |||
Percentage of membership interest in a subsidiary committed to purchase by an affiliate | 50.10% | ||
Albuquerque Suite Hospitality, LLC [Member] | |||
Sale price per unit | $ 10,000 | ||
Number of units were available for sale | 10,000 | ||
Number of units sold during period | 112 | ||
Tucson Hospitality Properties LP [Member] | Rare Earth Financial, LLC [Member] | |||
Cumulative priority distributions per unit per year | $ 700 |
Property, Equipment, and Hote_3
Property, Equipment, and Hotel Properties - Schedule of Property, Equipment, and Hotel Properties (Details) - USD ($) | Oct. 31, 2020 | Jan. 31, 2020 |
Property, Plant and Equipment, net | $ 8,367,801 | $ 8,983,323 |
Hotel Properties [Member] | ||
Total property, plant and equipment | 17,071,673 | 17,017,355 |
Less accumulated depreciation | (8,770,787) | (8,155,224) |
Property, Plant and Equipment, net | 8,300,886 | 8,903,096 |
Hotel Properties [Member] | Land [Member] | ||
Total property, plant and equipment | 2,500,000 | 2,500,000 |
Hotel Properties [Member] | Building and Improvements [Member] | ||
Total property, plant and equipment | 10,519,606 | 10,495,465 |
Hotel Properties [Member] | Furniture, Fixtures and Equipment [Member] | ||
Total property, plant and equipment | 4,052,067 | 4,021,890 |
Hotel Properties [Member] | Hotel Properties in Service [Member] | ||
Total property, plant and equipment | 8,300,886 | 8,862,131 |
Hotel Properties [Member] | Construction in Progress [Member] | ||
Total property, plant and equipment | 0 | 40,965 |
Property, Plant and Equipment [Member] | ||
Total property, plant and equipment | 248,788 | 243,654 |
Less accumulated depreciation | (181,873) | (163,427) |
Property, Plant and Equipment, net | 66,915 | 80,227 |
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 | $ 166,121 | $ 160,987 |
Mortgage Notes Payable (Details
Mortgage Notes Payable (Details Narrative) - USD ($) | Jun. 29, 2017 | Oct. 31, 2020 | Jan. 31, 2020 |
Debt instrument maturity description | The mortgage note payable has a scheduled maturity date in June 2042. | ||
Mortgage notes payable interest rate | 4.69% | 4.69% | |
Debt instrument interest rate | 7.00% | ||
Mortgage loan face amount | $ 4,600,000 | $ 4,709,000 | |
Debt instrument discount | 5,000 | 5,000 | |
Mortgage note payable monthly installments | $ 28,493 | ||
Albuquerque Hotel [Member] | |||
Debt instrument interest rate | 4.90% | ||
Mortgage loan face amount | $ 1,400,000 | ||
Tempe InnSuites Phoenix Airport [Member] | |||
Affiliate loan amount | $ 1,000,000 | $ 1,000,000 | |
Business Loan Agreement [Member] | |||
Mortgage facility amount | $ 5,000,000 | ||
Refinancing mortgage facility amount | $ 3,045,000 | ||
Debt instrument maturity date | Jun. 19, 2042 | ||
Business Loan Agreement [Member] | Interest Floor Rate [Member] | |||
Debt instrument interest rate | 4.69% | ||
Business Loan Agreement [Member] | Prime Rate [Member] | |||
Debt instrument interest rate | 2.00% |
Notes Payable - Related Party (
Notes Payable - Related Party (Details Narrative) - USD ($) | Dec. 02, 2014 | Oct. 31, 2020 | Oct. 31, 2019 | Jan. 31, 2020 |
Outstanding note payable | $ 35,000 | $ 161,440 | ||
Rare Earth Financial, LLC [Member] | ||||
Line of credit interest rate | 7.00% | |||
Line of credit maturity date | Aug. 24, 2021 | |||
Line of credit increased maximum borrowing capacity | 1,000,000 | |||
Outstanding note payable | 35,000 | $ 0 | ||
Interest expense, related party | $ 0 | $ 0 |
Other Notes Payable (Details Na
Other Notes Payable (Details Narrative) - USD ($) | Jul. 01, 2019 | Oct. 31, 2020 | Dec. 31, 2020 | Mar. 01, 2021 | Jan. 31, 2020 | Mar. 20, 2017 | Jun. 20, 2016 |
Debt instrument interest rate | 7.00% | ||||||
Debt instrument, principal amount | $ 4,600,000 | $ 4,709,000 | |||||
Hayden Loan [Member] | |||||||
Debt instrument interest rate | 4.50% | ||||||
Debt instrument, maturity date | Jun. 30, 2021 | ||||||
Unsecured loan | $ 270,000 | ||||||
Hayes Loan [Member] | |||||||
Debt instrument, principal amount | 270,000 | ||||||
Sweitzer Loans [Member] | |||||||
Debt instrument interest rate | 4.00% | ||||||
Debt instrument, maturity date | Jun. 30, 2021 | ||||||
Unsecured loan | $ 100,000 | ||||||
Debt instrument, principal amount | 100,000 | ||||||
Individual Lender [Member] | |||||||
Notes payable outstanding to unrelated third parties | $ 200,000 | ||||||
Debt instrument interest rate | 4.00% | ||||||
Unsecured loan | $ 200,000 | ||||||
Other Notes Payable [Member] | |||||||
Debt instrument interest rate | 7.00% | ||||||
Debt instrument, maturity date | Jan. 31, 2023 | ||||||
Other Notes Payable [Member] | Class A Partnership Units [Member] | |||||||
Notes payable outstanding to unrelated third parties | $ 136,000 | ||||||
Stock repurchased during period, shares | 516,488 | ||||||
Other Notes Payable [Member] | Shares of Beneficial Interest [Member] | |||||||
Stock repurchased during period, shares | 314,100 | ||||||
Other Notes Payable [Member] | Class A [Member] | Shares of Beneficial Interest [Member] | Albuquerque Suite Hospitality, LLC [Member] | |||||||
Stock repurchased during period, shares | 1 | ||||||
Paycheck Protection Program, CARES Act [Member] | Tucson Hospitality Properties LP [Member] | |||||||
Debt instrument, principal amount | $ 228,602 | ||||||
Paycheck Protection Program, CARES Act [Member] | Tucson Hospitality Properties LP [Member] | Subsequent Event [Member] | |||||||
Debt instrument, principal amount | $ 228,602 | ||||||
Paycheck Protection Program, CARES Act [Member] | Albuquerque Suite Hospitality, LLC [Member] | |||||||
Debt instrument, principal amount | 187,685 | ||||||
Paycheck Protection Program, CARES Act [Member] | Albuquerque Suite Hospitality, LLC [Member] | Subsequent Event [Member] | |||||||
Debt instrument, principal amount | 187,685 | ||||||
Paycheck Protection Program, CARES Act [Member] | InnSuites Hospitality [Member] | |||||||
Debt instrument, principal amount | $ 86,700 | ||||||
Debt forgiven | $ 86,700 | ||||||
Paycheck Protection Program, CARES Act [Member] | InnSuites Hospitality [Member] | Subsequent Event [Member] | |||||||
Debt instrument, principal amount | $ 86,700 |
Minimum Debt Payments - Schedul
Minimum Debt Payments - Scheduled of Minimum Payments of Debt (Details) | Oct. 31, 2020USD ($) |
2021 | $ 679,068 |
2022 | 725,548 |
2023 | 191,691 |
2024 | 219,151 |
2025 | 192,828 |
2026 | 203,490 |
Thereafter | 4,980,873 |
Long term debt | 7,192,649 |
Mortgages [Member] | |
2021 | 40,849 |
2022 | 170,856 |
2023 | 176,852 |
2024 | 219,151 |
2025 | 192,828 |
2026 | 203,490 |
Thereafter | 4,980,873 |
Long term debt | 5,984,899 |
Other Notes Payable [Member] | |
2021 | 638,219 |
2022 | 554,692 |
2023 | 14,839 |
Long term debt | $ 1,207,750 |
Description of Beneficial Int_2
Description of Beneficial Interests (Details Narrative) - shares | Jun. 19, 2017 | Jan. 31, 2010 | Sep. 15, 2009 | Jan. 05, 2009 | Sep. 10, 2007 | Aug. 18, 2005 | Sep. 10, 2002 | Jan. 02, 2001 | Oct. 31, 2020 | Oct. 31, 2019 | Apr. 30, 2019 |
Stock repurchase program, remaining number of shares authorized to be repurchased | 1.06 | 1.71 | |||||||||
Stock repurchase program, number of shares authorized to be repurchased | 711,380 | ||||||||||
Shares of Beneficial Interest [Member] | |||||||||||
Stock repurchased during period, shares | 230,582 | 73,385 | |||||||||
Maximum [Member] | |||||||||||
Number of units were available for sale | 750,000 | 350,000 | 250,000 | 300,000 | 350,000 | 350,000 | 350,000 | 250,000 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | Jun. 17, 2017 | Dec. 22, 2015 | Dec. 02, 2014 | Oct. 31, 2020 | Oct. 31, 2019 | Jan. 31, 2020 |
Revenue | $ 109,000 | |||||
Advances to affiliate | 1,000,000 | |||||
Outstanding note payable | 35,000 | $ 161,440 | ||||
Tempe/Phoenix Airport Resort LLC [Member] | ||||||
Advances to affiliate | $ 657,000 | |||||
Percentage of advances affiliate owns | 42.00% | |||||
Line of credit limit | $ 1,000,000 | |||||
Line of credit maturity date | Dec. 31, 2021 | |||||
Line of credit interest rate | 7.00% | |||||
Interest income | 52,500 | $ 1,970 | ||||
Advances from affiliate - related party | $ 657,000 | |||||
General Partner [Member] | ||||||
Partnership ownership interest percentage | 75.89% | 75.89% | ||||
Innsuites Hotel Located in Tucson [Member] | ||||||
Partnership ownership interest percentage | 51.01% | |||||
Innsuites Hotel Located in Albuquerque New Mexico [Member] | ||||||
Partnership ownership interest percentage | 20.17% | |||||
Mr. Wirth and Affiliates [Member] | ||||||
Number of shares held for beneficial interest of trust | 5,876,683 | 5,876,683 | ||||
Percentage of shares issued and outstanding of beneficial interest | 61.38% | 61.32% | ||||
Mr. Wirth and Affiliates [Member] | Class B Partnership Units [Member] | ||||||
Number of partnership unit held for affiliates | 2,974,038 | 2,974,038 | ||||
Percentage of outstanding partnership units | 20.17% | 20.17% | ||||
IBC Hotels [Member] | Mr. Wirth and Affiliates [Member] | ||||||
Percentage of room revenue received from hotels owned by affiliates | 5.00% | |||||
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. | |||||
Mr. Wirth, Brain James and Affiliates [Member] | ||||||
Yearly salary | $ 36,000 | |||||
Rare Earth Financial [Member] | ||||||
Revenue | 0 | |||||
Line of credit limit | $ 1,000,000 | |||||
Line of credit maturity date | Jun. 30, 2021 | |||||
Line of credit interest rate | 7.00% | |||||
Interest income | 0 | |||||
Line of credit | $ 35,000 |
Statements of Cash Flows, Sup_2
Statements of Cash Flows, Supplemental Disclosures (Details Narrative) - USD ($) | 9 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Supplemental Cash Flow Elements [Abstract] | ||
Cash paid for interest | $ 182,000 | $ 37,200 |
Notes Payables - IHT Shares of Beneficial Interest and Partnership Units repurchases | 130,000 | 124,000 |
Cash paid for taxes | $ 0 | $ 0 |
Commitments and Contingencies (
Commitments and Contingencies (Details Narrative) - USD ($) | 9 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Jan. 31, 2020 | |
Restricted cash | $ 0 | $ 0 | |
Membership fees and reservation amount | $ 97,000 | $ 125,000 | |
Tucson Oracle Property [Member] | |||
Percentage of deposit used for capital expenditures | 4.00% |
Leases (Details Narrative)
Leases (Details Narrative) - USD ($) | Sep. 01, 2017 | Oct. 31, 2020 |
Northpoint Properties [Member] | ||
Operating lease, description | 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 | $ 4,100 | |
Increases in rent rate yearly | 6.00% | |
Operating lease, option to terminate | 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. | |
Operating lease, existence of option to terminate | true | |
Operating lease, early termination fee, year one | $ 12,000 | |
Operating lease, early termination fee, year two | 8,000 | |
Operating lease, early termination fee, year three | 6,000 | |
Operating lease, early termination fee, year four | 4,000 | |
Operating lease, early termination fee, year five | $ 2,000 | |
Northpoint Properties [Member] | Minimum [Member] | ||
Operating lease term of contract | 1 year | |
Northpoint Properties [Member] | Maximum [Member] | ||
Operating lease term of contract | 5 years | |
Albuquerque Hotel [Member] | ||
Operating lease, option to extend | The Albuquerque Hotel non-cancelable ground lease was extended on January 14, 2014 and expires in 2058. | |
Operating lease, existence of option to extend | true |
Leases - Schedule of Lease Cost
Leases - Schedule of Lease Costs (Details) | 9 Months Ended | |
Oct. 31, 2020USD ($) | ||
Leases [Abstract] | ||
Operating lease cost | $ 150,260 | [1] |
Finance Lease Cost: Amortization of lease obligations | 20,811 | |
Finance Lease Cost: Interest on lease obligations | $ 3,557 | |
[1] | Short term lease costs were immaterial. |
Leases - Schedule of Cash Flow
Leases - Schedule of Cash Flow Information (Details) - USD ($) | 9 Months Ended | |
Oct. 31, 2020 | Jan. 31, 2020 | |
Leases [Abstract] | ||
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from operating leases | $ 126,102 | |
Lease Obligations obtained: Operating leases, net | 2,383,120 | |
Lease Obligations obtained: Long-term obligations | 2,326,160 | $ 2,252,964 |
Cash paid for amounts included in the measurement of lease liabilities: Operating cash flows from finance leases | 25,936 | |
Lease Obligations obtained: Finance leases | 86,732 | |
Lease Obligations obtained: Long-term obligations | $ 59,209 | $ 75,396 |
Leases - Schedule of Weighted A
Leases - Schedule of Weighted Average Remaining Lease Terms and Discount Rates (Details) | Oct. 31, 2020 |
Leases [Abstract] | |
Weighted-average remaining lease term (years) - Operating leases | 37 years |
Weighted-average discount rate - operating leases | 4.85% |
Weighted average remaining lease term (years) - Finance leases | 3 years |
Weighted-average discount rate - Finance leases | 4.85% |
Leases - Schedule of Future Min
Leases - Schedule of Future Minimum Rental Payments for Operating Lease and Finance Lease (Details) - USD ($) | Oct. 31, 2020 | Jan. 31, 2020 |
Leases [Abstract] | ||
Remaining in 2021 | $ 42,678 | |
2022 | 172,177 | |
2023 | 148,348 | |
2024 | 112,116 | |
2025 | 112,116 | |
Thereafter | 5,151,311 | |
Total minimum lease payments | 5,738,746 | |
Less: amount representing interest | 3,355,626 | |
Total present value of minimum payments | 2,383,120 | |
Less: current portion of operating lease liability | 56,960 | $ 168,780 |
Long term portion of operating lease liability | 2,326,160 | 2,252,964 |
Remaining in 2021 | 7,781 | |
2022 | 31,123 | |
2023 | 31,123 | |
2024 | 23,343 | |
Total minimum lease payments | 93,370 | |
Less: amount representing interest | 6,638 | |
Total present value of minimum payments | 86,732 | |
Less: current portion | 27,523 | 31,123 |
Long term portion of finance lease liability | $ 59,209 | $ 75,396 |
Share-Based Payments (Details N
Share-Based Payments (Details Narrative) | 9 Months Ended |
Oct. 31, 2020USD ($)shares | |
Number of restricted shares issued, value | $ | $ 32,400 |
Number of restricted shares | 18,000 |
1997 Stock Incentive and Option Plan [Member] | |
Stock options expiration period | 10 years |
Options granted | |
Options outstanding | |
Options available to grant | 1,000,000 |
Class A and B Limited Partnership Units [Member] | |
Percentage of shares of beneficial interest and partnership unit | 10.00% |
Independent Trustees One [Member] | |
Number of restricted shares | 6,000 |
Independent Trustees Two [Member] | |
Number of restricted shares | 6,000 |
Independent Trustees Three [Member] | |
Number of restricted shares | 6,000 |
Notes Receivable (Details Narra
Notes Receivable (Details Narrative) - USD ($) | Jan. 31, 2020 | Aug. 15, 2018 | Aug. 15, 2018 | Aug. 14, 2018 | Oct. 31, 2020 | Jan. 31, 2019 |
Proceeds from sale of business and receivable | $ 250,000 | |||||
Debt instrument, principal amount | $ 4,709,000 | $ 4,600,000 | ||||
Debt instrument interest rate | 7.00% | |||||
Working capital support period | 9 months | |||||
Working capital per month | 125,000 | $ 100,000 | ||||
Debt default payment, description | If Buyer has not paid two or more payments on the note as scheduled, or if Buyer has not satisfied any other provisions in the note, IHT may give Buyer notice of default. If Buyer fails to cure the default within 30 days after notice (a) on or before February 5, 2021, then 75% of the issued and outstanding IBC interest shall be transferred to IHT, and (b) on or after February 5, 2021, then 51% of the issued and outstanding interest of the Company shall be transferred to IHT. Currently there has been no default due to the extension granted. | |||||
Promissory Notes [Member] | ||||||
Debt instrument, principal amount | 275,000 | |||||
Impairment charges | $ 825,000 | |||||
Percentage of impairment | 30.00% | |||||
IBC Hotels, LLC [Member] | ||||||
Debt instrument, principal amount | $ 225,000 | $ 225,000 | ||||
Proceeds from notes receivable | $ 2,500,000 | |||||
Proceeds from notes receivable, percentage | 50.00% | |||||
Unpaid balance percentage | 50.00% | |||||
Working capital support period | 6 months | |||||
IBC Hotels, LLC [Member] | Promissory Notes [Member] | ||||||
Debt instrument, principal amount | $ 2,750,000 | $ 2,750,000 | ||||
Debt instrument interest rate | 3.75% | 3.75% | ||||
IBC Hotels, LLC [Member] | Unrelated Third Party Buyer [Member] | ||||||
Final sales amount | $ 3,000,000 | $ 3,000,000 |
Notes Receivable - Schedule of
Notes Receivable - Schedule of Future Payments of Debt (Details) - USD ($) | Oct. 31, 2020 | Jan. 31, 2020 |
Priority return payments | ||
2021 | ||
2022 | 550,000 | |
2023 | 550,000 | |
2024 | 825,000 | |
Notes receivable | $ 1,925,500 | $ 1,833,333 |
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 |
Income and Occupancy Taxes (Det
Income and Occupancy Taxes (Details Narrative) | 3 Months Ended | 9 Months Ended |
Oct. 31, 2020USD ($) | Oct. 31, 2020USD ($) | |
Income Tax Disclosure [Abstract] | ||
Deferred tax assets | $ 4,000,000 | $ 4,000,000 |
Net operating loss carryforwards | 1,100,000 | 1,100,000 |
Syndications | 2,900,000 | 2,900,000 |
Deferred tax liability | 1,500,000 | 1,500,000 |
Valuation allowance | 2,500,000 | 2,500,000 |
Penalties and interest | $ 78,000 | $ 844,000 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | Mar. 15, 2021 | Mar. 05, 2021 | Dec. 18, 2020 | Dec. 01, 2020 | Nov. 20, 2020 | Mar. 16, 2021 | Oct. 31, 2020 | Jan. 31, 2020 |
Debt instrument face amount | $ 4,600,000 | $ 4,709,000 | ||||||
Debt interest rate | 7.00% | |||||||
Albuquerque Hotel [Member] | ||||||||
Debt instrument face amount | $ 1,400,000 | |||||||
Debt interest rate | 4.90% | |||||||
UniGen Power Inc. [Member] | ||||||||
Debt interest rate | 6.00% | |||||||
UniGen Power Inc. [Member] | Subsequent Event [Member] | ||||||||
Line of credit, funded value | $ 500,000 | |||||||
Stock conversion per share | $ 1 | |||||||
UniGen Power Inc. [Member] | Subsequent Event [Member] | Line of Credit [Member] | ||||||||
Debt instrument face amount | $ 500,000 | |||||||
Debt interest rate | 6.00% | |||||||
Debt instrument maturity date | Dec. 31, 2024 | |||||||
Common stock warrants | 300,000 | |||||||
Warrants exercise price per shares | $ 2.25 | |||||||
Tempe Hotel [Member] | Subsequent Event [Member] | ||||||||
Proceeds from loan | $ 1,000,000 | |||||||
PPP Loan [Member] | ||||||||
Debt forgiven amount | $ 86,937 | |||||||
PPP Loan [Member] | Tucson Hotel Loan [Member] | ||||||||
Debt forgiven amount | 228,602 | |||||||
PPP Loan [Member] | Albuquerque Hotel [Member] | ||||||||
Debt forgiven amount | $ 188,000 | |||||||
PPP Loan [Member] | Albuquerque Hotel [Member] | Subsequent Event [Member] | ||||||||
Proceeds from loan | $ 253,253 | |||||||
PPP Loan [Member] | Tucson Hotel [Member] | Subsequent Event [Member] | ||||||||
Proceeds from loan | $ 297,601 |