Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Sep. 30, 2017 | Nov. 06, 2017 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Sep. 30, 2017 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q1 | |
Entity Registrant Name | SANTA FE FINANCIAL CORP | |
Entity Central Index Key | 86,759 | |
Current Fiscal Year End Date | --06-30 | |
Entity Filer Category | Smaller Reporting Company | |
Trading Symbol | SFEF | |
Entity Common Stock, Shares Outstanding | 1,241,810 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Sep. 30, 2017 | Jun. 30, 2017 |
ASSETS | ||
Investment in Hotel, net | $ 37,760,000 | $ 38,390,000 |
Investment in real estate, net | 4,989,000 | 5,007,000 |
Investment in marketable securities | 5,052,000 | 5,874,000 |
Other investments, net | 696,000 | 696,000 |
Cash and cash equivalents | 1,572,000 | 2,097,000 |
Restricted cash | 5,597,000 | 5,173,000 |
Accounts receivable - Hotel, net | 2,614,000 | 1,436,000 |
Other assets, net | 1,508,000 | 1,683,000 |
Deferred tax assets | 10,665,000 | 10,927,000 |
Total assets | 70,453,000 | 71,283,000 |
Liabilities: | ||
Accounts payable and other liabilities | 17,239,000 | 17,402,000 |
Due to securities broker | 662,000 | 1,005,000 |
Obligations for securities sold | 1,244,000 | 1,271,000 |
Related party and other notes payable | 10,129,000 | 10,209,000 |
Mortgage notes payable - real estate | 3,240,000 | 3,256,000 |
Mortgage notes payable - Hotel, net | 115,329,000 | 115,615,000 |
Total liabilities | 147,843,000 | 148,758,000 |
Shareholders' deficit: | ||
Common stock - par value $.10 per share; Authorized - 2,000,000; Issued 1,339,638 and outstanding 1,241,810 | 134,000 | 134,000 |
Additional paid-in capital | 8,808,000 | 8,808,000 |
Accumulated deficit | (59,022,000) | (58,938,000) |
Treasury stock, at cost, 97,828 shares | (951,000) | (951,000) |
Total Santa Fe shareholders' deficit | (51,031,000) | (50,947,000) |
Noncontrolling interest | (26,359,000) | (26,528,000) |
Total shareholders' deficit | (77,390,000) | (77,475,000) |
Total liabilities and shareholders' deficit | $ 70,453,000 | $ 71,283,000 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] - $ / shares | Sep. 30, 2017 | Jun. 30, 2017 |
Common stock, par value (in dollars per share) | $ 0.10 | $ 0.10 |
Common Stock, Shares Authorized | 2,000,000 | 2,000,000 |
Common Stock, Shares, Issued | 1,339,638 | 1,339,638 |
Common Stock, Shares, Outstanding | 1,241,810 | 1,241,810 |
Treasury Stock, Shares | 97,828 | 97,828 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Revenues: | ||
Hotel | $ 14,437,000 | $ 14,605,000 |
Real estate | 85,000 | 90,000 |
Total revenues | 14,522,000 | 14,695,000 |
Costs and operating expenses: | ||
Hotel operating expenses | (10,589,000) | (10,256,000) |
Real estate operating expenses | (48,000) | (48,000) |
Depreciation and amortization expense | (698,000) | (684,000) |
General and administrative expense | (326,000) | (245,000) |
Total costs and operating expenses | (11,661,000) | (11,233,000) |
Income from operations | 2,861,000 | 3,462,000 |
Other income (expense): | ||
Interest expense - mortgage | (2,009,000) | (2,039,000) |
Net (loss) gain on marketable securities | (437,000) | 425,000 |
Impairment loss on other investments | 0 | (10,000) |
Dividend and interest income | 21,000 | 18,000 |
Trading and margin interest expense | (89,000) | (63,000) |
Other expense, net | (2,514,000) | (1,669,000) |
Income before income taxes | 347,000 | 1,793,000 |
Income tax expense | (262,000) | (705,000) |
Net income | 85,000 | 1,088,000 |
Less: Net income attributable to the noncontrolling interest | (169,000) | (402,000) |
Net income attributable to Santa Fe | $ (84,000) | $ 686,000 |
Basic and diluted net income per share attributable to Santa Fe | $ (0.07) | $ 0.55 |
Weighted average number of common shares outstanding - basic and diluted | 1,241,810 | 1,241,810 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Cash flows from operating activities: | ||
Net income | $ 85,000 | $ 1,088,000 |
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||
Net unrealized loss (gain) on marketable securities | 362,000 | (305,000) |
Impairment loss on other investments | 0 | 10,000 |
Depreciation | 698,000 | 684,000 |
Amortization | 28,000 | 28,000 |
Deferred tax asset | 262,000 | 705,000 |
Changes in operating assets and liabilities: | ||
Investment in marketable securities | 460,000 | (1,077,000) |
Accounts receivable | (1,178,000) | 206,000 |
Other assets | 175,000 | 436,000 |
Accounts payable and other liabilities | (163,000) | (3,063,000) |
Due to securities broker | (343,000) | 534,000 |
Obligations for securities sold | (27,000) | 421,000 |
Net cash provided by (used in) operating activities | 359,000 | (333,000) |
Cash flows from investing activities: | ||
Payments for hotel and real estate investments | (50,000) | (336,000) |
Net cash used in investing activities | (50,000) | (336,000) |
Cash flows from financing activities: | ||
Restricted cash - payments to mortgage impounds, net | (424,000) | (788,000) |
Net payments of related party and other notes payable | (410,000) | (536,000) |
Net cash used in financing activities | (834,000) | (1,324,000) |
Net decrease in cash and cash equivalents: | (525,000) | (1,993,000) |
Cash and cash equivalents at the beginning of the period | 2,097,000 | 3,397,000 |
Cash and cash equivalents at the end of the period | 1,572,000 | 1,404,000 |
Supplemental information: | ||
Interest paid | $ 2,055,000 | $ 2,038,000 |
BASIS OF PRESENTATION AND SIGNI
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Basis of Presentation and Significant Accounting Policies [Text Block] | The condensed consolidated financial statements included herein have been prepared by Santa Fe Financial Corporation (“Santa Fe” or the “Company”), without audit, according to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in the condensed consolidated financial statements prepared in accordance with generally accepted accounting principles (U.S. GAAP) have been condensed or omitted pursuant to such rules and regulations, although the Company believes the disclosures that are made are adequate to make the information presented not misleading. Further, the condensed consolidated financial statements reflect, in the opinion of management, all adjustments (which included only normal recurring adjustments) necessary for a fair statement of the financial position, cash flows and results of operations as of and for the periods indicated. It is suggested that these financial statements be read in conjunction with the audited financial statements of Santa Fe and the notes therein included in the Company's Annual Report on Form 10-K for the year ended June 30, 2017. The June 30, 2017 Condensed Consolidated Balance Sheet was derived from the Company’s Form 10-K for the year ended June 30, 2017. The results of operations for the three months ended September 30, 2017 are not necessarily indicative of results to be expected for the full fiscal year ending June 30, 2018. Santa Fe Financial Corporation, a Nevada corporation, (“Santa Fe” or the “Company”) owns approximately 68.8 81.9 13.4 Portsmouth’s primary business is conducted through its general and limited partnership interest in Justice Investors Limited Partnership; a California limited partnership (“Justice” or the “Partnership”). 93.1 Justice, through its subsidiaries Justice Holdings Company, LLC (“Holdings”), a Delaware Limited Liability Company, Justice Operating Company, LLC (“Operating”) and Justice Mezzanine Company, LLC (“Mezzanine”), owns a 544-room hotel property located at 750 Kearny Street, San Francisco California, known as the Hilton San Francisco Financial District (the “Hotel”) and related facilities including a five-level underground parking garage. Holdings and Mezzanine are both wholly-owned subsidiaries of the Partnership; Operating is a wholly-owned subsidiary of Mezzanine. Mezzanine is the borrower under certain mezzanine indebtedness of Justice, and in December 2013, the Partnership conveyed ownership of the Hotel to Operating. The Hotel is operated by the partnership as a full-service Hilton brand hotel pursuant to a Franchise License Agreement with HLT Franchise Holding LLC (Hilton). Justice had a management agreement with Prism Hospitality L.P. (“Prism”) to perform certain management functions for the Hotel. The management agreement with Prism had an original term of ten years, subject to the Partnership’s right to terminate at any time with or without cause. Effective January 2014, the management agreement with Prism was amended by the Partnership to change the nature of the services provided by Prism and the compensation payable to Prism, among other things. Prism’s management agreement was terminated upon its expiration date of February 3, 2017. Effective December 1, 2013, GMP Management, Inc. (“GMP”), a company owned by a Justice limited partner and a related party, also provided management services for the Partnership pursuant to a management services agreement, with a three-year term, subject to the Partnership’s right to terminate earlier for cause. In June 2016, GMP resigned. On February 1, 2017, Justice entered into a Hotel management agreement (“HMA”) with Interstate Management Company, LLC (“Interstate”) to manage the Hotel with an effective takeover date of February 3, 2017. The term of the HMA is for an initial period of ten years commencing on the takeover date and automatically renewals for an additional year not to exceed five years in aggregate subject to certain conditions. The HMA also provides for Interstate to advance a key money incentive fee to the Hotel for capital improvements in the amount of $ 2,000,000 The parking garage that is part of the Hotel property was managed by Ace Parking pursuant to a contract with the Partnership. The contract was terminated with an effective termination date of October 4, 2016. The Company began managing the parking garage in-house after the termination of Ace Parking. Effective February 3, 2017, Interstate took over the management of the parking garage along with the Hotel. Various securities brokers have advanced funds to the Company for the purchase of marketable securities under standard margin agreements. These advanced funds are recorded as a liability. Obligation for securities sold represents the fair market value of shares sold with the promise to deliver that security at some future date and the fair market value of shares underlying the written call options with the obligation to deliver that security when and if the option is exercised. The obligation may be satisfied with current holdings of the same security or by subsequent purchases of that security. Unrealized gains and losses from changes in the obligation are included in the condensed consolidated statements of operations. The Company consolidates Justice (“Hotel”) for financial reporting purposes and is not taxed on its non-controlling interest in the Hotel. The income tax expense during the three months ended September 30, 2017 and 2016 represents the income tax effect on the Company s pretax income which includes its share in the net income of the Hotel. The Company’s cash flows are primarily generated from its Hotel operations. The Company also receives cash generated from the investment of its cash and marketable securities and other investments. To fund the redemption of limited partnership interests and to repay the prior mortgage of $ 42,940,000 97,000,000 20,000,000 5.275 9.75 Effective as of May 11, 2017, InterGroup agreed to become an additional guarantor under the limited guaranty and an additional indemnitor under the environmental indemnity for Justice Investors limited partnership’s $ 97,000,000 20,000,000 Despite an uncertain economy, the Hotel has continued to generate positive operating income. While the debt service requirements related the loans may create some additional risk for the Company and its ability to generate cash flows in the future, management believes that cash flows from the operations of the Hotel and the garage will continue to be sufficient to meet all of the Partnership’s current and future obligations and financial requirements. The Company has invested in short-term, income-producing instruments and in equity and debt securities when deemed appropriate. The Company's marketable securities are classified as trading with unrealized gains and losses recorded through the consolidated statements of operations. Management believes that its cash, marketable securities, and the cash flows generated from those assets and from the partnership management fees, will be adequate to meet the Company’s current and future obligations. Additionally, management believes there is significant appreciated value in the Hotel property to support additional borrowings, if necessary. In addition to the operations of the Hotel, the Company also generates income from the ownership and management of real estate. On December 31, 1997, the Company acquired a controlling 55.4 In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern On June 16, 2016, the FASB issued ASU 2016-13, “ Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) |
INVESTMENT IN HOTEL, NET
INVESTMENT IN HOTEL, NET | 3 Months Ended |
Sep. 30, 2017 | |
Real Estate [Abstract] | |
Real Estate Disclosure [Text Block] | NOTE 2 INVESTMENT IN HOTEL, NET Accumulated Net Book September 30, 2017 Cost Depreciation Value Land $ 1,896,000 $ - $ 1,896,000 Furniture and equipment 27,830,000 (24,987,000) 2,843,000 Building and improvements 59,786,000 (26,765,000) 33,021,000 $ 89,512,000 $ (51,752,000) $ 37,760,000 Accumulated Net Book June 30, 2017 Cost Depreciation Value Land $ 1,896,000 $ - $ 1,896,000 Furniture and equipment 27,681,000 (24,570,000) 3,111,000 Building and improvements 59,771,000 (26,388,000) 33,383,000 $ 89,348,000 $ (50,958,000) $ 38,390,000 |
INVESTMENT IN REAL ESTATE, NET
INVESTMENT IN REAL ESTATE, NET | 3 Months Ended |
Sep. 30, 2017 | |
Real Estate [Abstract] | |
Investment In Real Estate [Text Block] | NOTE 3 INVESTMENT IN REAL ESTATE, NET As of September 30, 2017 June 30, 2017 Land $ 2,430,000 $ 2,430,000 Buildings, improvements and equipment 2,861,000 2,854,000 Accumulated depreciation (1,275,000) (1,250,000) 4,016,000 4,034,000 Land held for development 973,000 973,000 Investment in real estate, net $ 4,989,000 $ 5,007,000 In August 2007, Portsmouth agreed to acquire 50 100 973,000 |
INVESTMENT IN MARKETABLE SECURI
INVESTMENT IN MARKETABLE SECURITIES | 3 Months Ended |
Sep. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block] | NOTE 4 - INVESTMENT IN MARKETABLE SECURITIES The Company’s investment in marketable securities consists primarily of corporate equities. The Company has also periodically invested in corporate bonds and income producing securities, which may include interests in real estate based companies and REITs, where financial benefit could transfer to its shareholders through income and/or capital gain. Gross Gross Net Fair Investment Cost Unrealized Gain Unrealized Loss Unrealized Loss Value As of September 30, 2017 Corporate Equities $ 11,613,000 $ 666,000 $ (7,227,000) $ (6,561,000) $ 5,052,000 As of June 30, 2017 Corporate Equities $ 12,190,000 # $ 538,000 $ (6,854,000) $ (6,316,000) $ 5,874,000 As of September 30, 2017 and June 30, 2017, approximately 42 40 As of September 30, 2017 and June 30, 2017, the Company had $ 7,132,000 6,783,000 For the three months ended September 30, 2017 2016 Realized gain (loss) on marketable securities $ (75,000) $ 120,000 Unrealized gain (loss) on marketable securities (362,000) 305,000 Net gain (loss) on marketable securities $ (437,000) $ 425,000 |
OTHER INVESTMENTS, NET
OTHER INVESTMENTS, NET | 3 Months Ended |
Sep. 30, 2017 | |
Investments, All Other Investments [Abstract] | |
Other Investments Disclosure [Text Block] | NOTE 5 OTHER INVESTMENTS, NET The Company may also invest, with the approval of the Securities Investment Committee and other Company guidelines, in private investment equity funds and other unlisted securities, such as convertible notes through private placements. Those investments in non-marketable securities are carried at cost on the Company’s balance sheet as part of other investments, net of other than temporary impairment losses. Other investments, net consist of the following: Type September 30, 2017 June 30, 2017 Private equity hedge fund, at cost $ 485,000 $ 485,000 Other investment 211,000 211,000 $ 696,000 $ 696,000 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value Disclosures [Text Block] | NOTE 6 - FAIR VALUE MEASUREMENTS The carrying values of the Company’s financial instruments not required to be carried at fair value on a recurring basis approximate fair value due to their short maturities (i.e., accounts receivable, other assets, accounts payable and other liabilities) or the nature and terms of the obligation (i.e., other notes payable and mortgage notes payable). As of September 30, 2017 June 30, 2017 Total-Level 1 Total-Level 1 Assets: Investment in marketable securities: Basic materials $ 2,548,000 $ 2,766,000 Technology 1,324,000 1,386,000 Energy 395,000 689,000 Other 785,000 1,033,000 $ 5,052,000 $ 5,874,000 The fair values of investments in marketable securities are determined by the most recently traded price of each security at the balance sheet date. Financial assets that are measured at fair value on a non-recurring basis and are not included in the tables above include “Other investments, net (non-marketable securities),” that were initially measured at cost and have been written down to fair value as a result of impairment or adjusted to record the fair value of new instruments received (i.e., preferred shares) in exchange for old instruments (i.e., debt instruments). Assets Level 3 September 30, 2017 Net loss for the three months Other non-marketable investments $ 696,000 $ 696,000 $ - Assets Level 3 June 30, 2017 Net loss for the three months Other non-marketable investments $ 696,000 $ 696,000 $ (10,000) Other investments in non-marketable securities are carried at cost net of any impairment loss. The Company has no significant influence or control over the entities that issue these investments. These investments are reviewed on a periodic basis for other-than-temporary impairment. When determining the fair value of these investments on a non-recurring basis, the Company uses valuation techniques such as the market approach and the unobservable inputs include factors such as conversion ratios and the stock price of the underlying convertible instruments. The Company reviews several factors to determine whether a loss is other-than-temporary. These factors include but are not limited to: (i) the length of time an investment is in an unrealized loss position, (ii) the extent to which fair value is less than cost, (iii) the financial condition and near term prospects of the issuer and (iv) our ability to hold the investment for a period of time sufficient to allow for any anticipated recovery in fair value. |
SEGMENT INFORMATION
SEGMENT INFORMATION | 3 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | NOTE 7 SEGMENT INFORMATION The Company operates in three reportable segments, the operation of the Hotel (“Hotel Operations”), its multi-family residential properties (“Real Estate Operations”) and the investment of its cash in marketable securities and other investments (“Investment Transactions”). These three operating segments, as presented in the financial statements, reflect how management internally reviews each segment’s performance. Management also makes operational and strategic decisions based on this same information. As of and for the three months Hotel Real Estate Investment ended September 30, 2017 Operations Operations Transactions Other Total Revenues $ 14,437,000 $ 85,000 $ - $ - $ 14,522,000 Segment operating expenses (10,589,000) (48,000) - (326,000) (10,963,000) Segment income (loss) 3,848,000 37,000 - (326,000) 3,559,000 Interest expense - mortgage (1,987,000) (22,000) - - (2,009,000) Depreciation and amortization expense (673,000) (25,000) - - (698,000) Loss from investments - - (505,000) - (505,000) Income tax expense - - - (262,000) (262,000) Net income (loss) $ 1,188,000 $ (10,000) $ (505,000) $ (588,000) $ 85,000 Total assets $ 47,021,000 $ 4,989,000 $ 5,748,000 $ 12,695,000 $ 70,453,000 As of and for the three months Hotel Real Estate Investment ended September 30, 2016 Operations Operations Transactions Other Total Revenues $ 14,605,000 $ 90,000 $ - $ - $ 14,695,000 Segment operating expenses (10,256,000) (48,000) - (245,000) (10,549,000) Segment income (loss) 4,349,000 42,000 - (245,000) 4,146,000 Interest expense - mortgage (1,988,000) (23,000) - - (2,011,000) Depreciation and amortization expense (688,000) (24,000) - - (712,000) Income from investments - - 370,000 - 370,000 Income tax expense - - - (705,000) (705,000) Net income (loss) $ 1,673,000 $ (5,000) $ 370,000 $ (950,000) $ 1,088,000 Total assets $ 47,207,000 $ 5,091,000 $ 8,351,000 $ 11,685,000 $ 72,334,000 |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 3 Months Ended |
Sep. 30, 2017 | |
Related Party Transactions [Abstract] | |
Related Party Transactions Disclosure [Text Block] | NOTE 8 RELATED PARTY TRANSACTIONS On July 2, 2014, the Partnership obtained from InterGroup (a related party) an unsecured loan in the principal amount of $ 4,250,000 12 2 3 Also included in the balance of related party note payable at September 30, 2017 is the obligation to Hilton (Franchisor) in the form of a self-exhausting, interest free development incentive note which is reduced by approximately $316,000 annually through 2030 by Hilton if the Partnership is still a Franchisee with Hilton. The outstanding balance of the note as of September 30, 2017 and June 30, 2017, was $ 3,879,000 3,958,000 On February 1, 2017, Justice entered into a Hotel management agreement (“HMA”) with Interstate Management Company, LLC (“Interstate”) to manage the Hotel with an effective takeover date of February 3, 2017. The term of management agreement is for an initial period of 10 years commencing on the takeover date and automatically renews for an additional year not to exceed five years in the aggregate subject to certain conditions. The HMA also provides for Interstate to advance a key money incentive fee to the Hotel for capital improvements in the amount of $2,000,000 under certain terms and conditions described in a separate key money agreement. The key money contribution shall be amortized in equal monthly amounts over an eight (8) year period commencing on the second (2 nd In April 2017, Portsmouth obtained from InterGroup an unsecured short-term loan in the amount of $ 1,000,000 5 September 15, 2017 Effective May 12, 2017, InterGroup agreed to become an additional guarantor under the limited guaranty and an additional indemnitor under environmental indemnity for Justice Investors limited partnership’s $97,000,000 mortgage loan and the $20,000,000 mezzanine loan, in order to maintain certain minimum net worth and liquidity guarantor covenant requirements that Portsmouth was unable to satisfy independently. In connection with the redemption of the limited partnership interest of Justice, Justice Operating Company, LLC agreed to pay a total of $ 1,550,000 400,000 As of September 30, 2017, Justice has an outstanding accounts payable balance to InterGroup for $ 116,000 Four of the Portsmouth directors serve as directors of InterGroup. Three of those directors also serve as directors of Santa Fe. The three Santa Fe directors also serve as directors of InterGroup. As Chairman of the Securities Investment Committee, the Company’s President and Chief Executive Officer (CEO), John V. Winfield, directs the investment activity of the Company in public and private markets pursuant to authority granted by the Board of Directors. Mr. Winfield also serves as Chief Executive Officer and Chairman of the Portsmouth and InterGroup and oversees the investment activity of those companies. Depending on certain market conditions and various risk factors, the Chief Executive Officer, Portsmouth and InterGroup may, at times, invest in the same companies in which the Company invests. Such investments align the interests of the Company with the interests of related parties because it places the personal resources of the Chief Executive Officer and the resources of the Portsmouth and InterGroup, at risk in substantially the same manner as the Company in connection with investment decisions made on behalf of the Company. |
BASIS OF PRESENTATION AND SIG14
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Sep. 30, 2017 | |
Accounting Policies [Abstract] | |
Income Tax, Policy [Policy Text Block] | Income Tax The Company consolidates Justice (“Hotel”) for financial reporting purposes and is not taxed on its non-controlling interest in the Hotel. The income tax expense during the three months ended September 30, 2017 and 2016 represents the income tax effect on the Company s pretax income which includes its share in the net income of the Hotel. |
Due To And From Broker Dealers Policy Text Block [Policy Text Block] | Due to Securities Broker Various securities brokers have advanced funds to the Company for the purchase of marketable securities under standard margin agreements. These advanced funds are recorded as a liability. |
Obligations For Securities Sold [Policy Text Block] | Obligations for Securities Sold Obligation for securities sold represents the fair market value of shares sold with the promise to deliver that security at some future date and the fair market value of shares underlying the written call options with the obligation to deliver that security when and if the option is exercised. The obligation may be satisfied with current holdings of the same security or by subsequent purchases of that security. Unrealized gains and losses from changes in the obligation are included in the condensed consolidated statements of operations. |
Financial Condition And Liquidity [Policy Text Block] | Financial Condition and Liquidity The Company’s cash flows are primarily generated from its Hotel operations. The Company also receives cash generated from the investment of its cash and marketable securities and other investments. To fund the redemption of limited partnership interests and to repay the prior mortgage of $ 42,940,000 97,000,000 20,000,000 5.275 9.75 Effective as of May 11, 2017, InterGroup agreed to become an additional guarantor under the limited guaranty and an additional indemnitor under the environmental indemnity for Justice Investors limited partnership’s $ 97,000,000 20,000,000 Despite an uncertain economy, the Hotel has continued to generate positive operating income. While the debt service requirements related the loans may create some additional risk for the Company and its ability to generate cash flows in the future, management believes that cash flows from the operations of the Hotel and the garage will continue to be sufficient to meet all of the Partnership’s current and future obligations and financial requirements. The Company has invested in short-term, income-producing instruments and in equity and debt securities when deemed appropriate. The Company's marketable securities are classified as trading with unrealized gains and losses recorded through the consolidated statements of operations. Management believes that its cash, marketable securities, and the cash flows generated from those assets and from the partnership management fees, will be adequate to meet the Company’s current and future obligations. Additionally, management believes there is significant appreciated value in the Hotel property to support additional borrowings, if necessary. In addition to the operations of the Hotel, the Company also generates income from the ownership and management of real estate. On December 31, 1997, the Company acquired a controlling 55.4 |
New Accounting Pronouncements, Policy [Policy Text Block] | In August 2014, the FASB issued ASU No. 2014-15, Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern On June 16, 2016, the FASB issued ASU 2016-13, “ Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments In May 2014, the FASB issued Accounting Standards Update No. 2014-09, Revenue from Contracts with Customers (Topic 606) Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date Revenue from Contracts with Customers (Topic 606): Principal versus Agent Considerations (Reporting Revenue Gross versus Net) |
INVESTMENT IN HOTEL, NET (Table
INVESTMENT IN HOTEL, NET (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Property, Plant and Equipment [Abstract] | |
Schedule of Real Estate Properties [Table Text Block] | Investment in hotel consisted of the following as of: Accumulated Net Book September 30, 2017 Cost Depreciation Value Land $ 1,896,000 $ - $ 1,896,000 Furniture and equipment 27,830,000 (24,987,000) 2,843,000 Building and improvements 59,786,000 (26,765,000) 33,021,000 $ 89,512,000 $ (51,752,000) $ 37,760,000 Accumulated Net Book June 30, 2017 Cost Depreciation Value Land $ 1,896,000 $ - $ 1,896,000 Furniture and equipment 27,681,000 (24,570,000) 3,111,000 Building and improvements 59,771,000 (26,388,000) 33,383,000 $ 89,348,000 $ (50,958,000) $ 38,390,000 |
INVESTMENT IN REAL ESTATE, NET
INVESTMENT IN REAL ESTATE, NET (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Real Estate [Abstract] | |
Schedule of Investment In Real Estate [Table Text Block] | The Company owns and operates a 27-unit multi-family apartment complex located in Santa Monica, California and a 2-unit multi-family apartment complex located in Los Angeles, California. The Company also owns land held for development located in Maui, Hawaii. Investment in real estate consisted of the following: As of September 30, 2017 June 30, 2017 Land $ 2,430,000 $ 2,430,000 Buildings, improvements and equipment 2,861,000 2,854,000 Accumulated depreciation (1,275,000) (1,250,000) 4,016,000 4,034,000 Land held for development 973,000 973,000 Investment in real estate, net $ 4,989,000 $ 5,007,000 |
INVESTMENT IN MARKETABLE SECU17
INVESTMENT IN MARKETABLE SECURITIES (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Investments, Debt and Equity Securities [Abstract] | |
Marketable Securities [Table Text Block] | Gross Gross Net Fair Investment Cost Unrealized Gain Unrealized Loss Unrealized Loss Value As of September 30, 2017 Corporate Equities $ 11,613,000 $ 666,000 $ (7,227,000) $ (6,561,000) $ 5,052,000 As of June 30, 2017 Corporate Equities $ 12,190,000 # $ 538,000 $ (6,854,000) $ (6,316,000) $ 5,874,000 |
Gain (Loss) on Investments [Table Text Block] | Net loss on marketable securities on the statement of operations is comprised of realized and unrealized gains (losses). Below is the composition of the two components for the three months ended September 30, 2017 and 2016, respectively. For the three months ended September 30, 2017 2016 Realized gain (loss) on marketable securities $ (75,000) $ 120,000 Unrealized gain (loss) on marketable securities (362,000) 305,000 Net gain (loss) on marketable securities $ (437,000) $ 425,000 |
OTHER INVESTMENTS, NET (Tables)
OTHER INVESTMENTS, NET (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Investments, All Other Investments [Abstract] | |
Schedule Of Other Investments Not Readily Marketable [Table Text Block] | Other investments, net consist of the following: Type September 30, 2017 June 30, 2017 Private equity hedge fund, at cost $ 485,000 $ 485,000 Other investment 211,000 211,000 $ 696,000 $ 696,000 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Assets Measured on Recurring Basis [Table Text Block] | The assets measured at fair value on a recurring basis are as follows: As of September 30, 2017 June 30, 2017 Total-Level 1 Total-Level 1 Assets: Investment in marketable securities: Basic materials $ 2,548,000 $ 2,766,000 Technology 1,324,000 1,386,000 Energy 395,000 689,000 Other 785,000 1,033,000 $ 5,052,000 $ 5,874,000 |
Fair Value Measurements, Nonrecurring [Table Text Block] | The following table shows the fair value hierarchy for these assets measured at fair value on a non-recurring basis as follows: Assets Level 3 September 30, 2017 Net loss for the three months Other non-marketable investments $ 696,000 $ 696,000 $ - Assets Level 3 June 30, 2017 Net loss for the three months Other non-marketable investments $ 696,000 $ 696,000 $ (10,000) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 3 Months Ended |
Sep. 30, 2017 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Information below represents reporting segments for the three months ended September 30, 2017 and 2016, respectively. Segment income from Hotel operations consists of the operation of the Hotel and operation of the garage. Segment income from real estate operations consists of the operation of the rental properties. Segment (loss) gain from investments consists of net investment gain (loss), dividend and interest income and investment related expenses. As of and for the three months Hotel Real Estate Investment ended September 30, 2017 Operations Operations Transactions Other Total Revenues $ 14,437,000 $ 85,000 $ - $ - $ 14,522,000 Segment operating expenses (10,589,000) (48,000) - (326,000) (10,963,000) Segment income (loss) 3,848,000 37,000 - (326,000) 3,559,000 Interest expense - mortgage (1,987,000) (22,000) - - (2,009,000) Depreciation and amortization expense (673,000) (25,000) - - (698,000) Loss from investments - - (505,000) - (505,000) Income tax expense - - - (262,000) (262,000) Net income (loss) $ 1,188,000 $ (10,000) $ (505,000) $ (588,000) $ 85,000 Total assets $ 47,021,000 $ 4,989,000 $ 5,748,000 $ 12,695,000 $ 70,453,000 As of and for the three months Hotel Real Estate Investment ended September 30, 2016 Operations Operations Transactions Other Total Revenues $ 14,605,000 $ 90,000 $ - $ - $ 14,695,000 Segment operating expenses (10,256,000) (48,000) - (245,000) (10,549,000) Segment income (loss) 4,349,000 42,000 - (245,000) 4,146,000 Interest expense - mortgage (1,988,000) (23,000) - - (2,011,000) Depreciation and amortization expense (688,000) (24,000) - - (712,000) Income from investments - - 370,000 - 370,000 Income tax expense - - - (705,000) (705,000) Net income (loss) $ 1,673,000 $ (5,000) $ 370,000 $ (950,000) $ 1,088,000 Total assets $ 47,207,000 $ 5,091,000 $ 8,351,000 $ 11,685,000 $ 72,334,000 |
BASIS OF PRESENTATION AND SIG21
BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES (Details Textual) - USD ($) | 3 Months Ended | |
Sep. 30, 2017 | May 11, 2017 | |
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Subsidiary of Limited Liability Company or Limited Partnership, Ownership Interest | 93.10% | |
Management Services Agreement Term | 3 years | |
Key Money Incentive Advance To Related Party | $ 2,000,000 | |
Proceeds from Sale of Loans and Leases Held-for-investment | 42,940,000 | |
Mortgage Loans on Real Estate, Face Amount of Mortgages | $ 97,000,000 | |
Mortgage Loans on Real Estate, Interest Rate | 5.275% | |
Mortgage Loans on Real Estate, Final Maturity Date | Jan. 31, 2024 | |
Mortgage Loans on Real Estate, Carrying Amount of Mortgages | $ 97,000,000 | |
Mezzanine Loan [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Mortgage Loans on Real Estate, Face Amount of Mortgages | $ 20,000,000 | |
Mortgage Loans on Real Estate, Interest Rate | 9.75% | |
Mortgage Loans on Real Estate, Final Maturity Date | Jan. 31, 2024 | |
Mortgage Loans on Real Estate, Carrying Amount of Mortgages | $ 20,000,000 | |
Portsmouth [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Equity Method Investment, Ownership Percentage | 68.80% | |
Intergroup [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Equity Method Investment, Ownership Percentage | 81.90% | |
Noncontrolling Interest, Ownership Percentage by Parent | 13.40% | |
Woodland Village Inc [Member] | ||
Basis Of Presentation And Significant Accounting Policies [Line Items] | ||
Mortgage Loans on Real Estate, Carrying Amount of Mortgages | $ 55.4 |
INVESTMENT IN HOTEL, NET (Detai
INVESTMENT IN HOTEL, NET (Details) - USD ($) | Sep. 30, 2017 | Jun. 30, 2017 |
Property, Plant and Equipment [Line Items] | ||
Cost | $ 89,512,000 | $ 89,348,000 |
Accumulated Depreciation | (51,752,000) | (50,958,000) |
Net Book Value | 37,760,000 | 38,390,000 |
Land [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 1,896,000 | 1,896,000 |
Accumulated Depreciation | 0 | 0 |
Net Book Value | 1,896,000 | 1,896,000 |
Furniture and equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 27,830,000 | 27,681,000 |
Accumulated Depreciation | (24,987,000) | (24,570,000) |
Net Book Value | 2,843,000 | 3,111,000 |
Building and improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Cost | 59,786,000 | 59,771,000 |
Accumulated Depreciation | (26,765,000) | (26,388,000) |
Net Book Value | $ 33,021,000 | $ 33,383,000 |
INVESTMENT IN REAL ESTATE, NE23
INVESTMENT IN REAL ESTATE, NET (Details) - USD ($) | Sep. 30, 2017 | Jun. 30, 2017 |
Property, Plant and Equipment [Line Items] | ||
Land | $ 2,430,000 | $ 2,430,000 |
Buildings, improvements and equipment | 2,861,000 | 2,854,000 |
Accumulated depreciation | (1,275,000) | (1,250,000) |
Real Estate Investment Property Net | 4,016,000 | 4,034,000 |
Land held for development | 973,000 | 973,000 |
Investment in real estate, net | $ 4,989,000 | $ 5,007,000 |
INVESTMENT IN REAL ESTATE, NE24
INVESTMENT IN REAL ESTATE, NET (Details Textual) | Aug. 31, 2007USD ($) |
Intergroup [Member] | |
Property, Plant and Equipment [Line Items] | |
Business Acquisition, Percentage of Voting Interests Acquired | 50.00% |
Business Acquisition Cost Of Acquired Purchase Price | $ 973,000 |
Hawaiian Corporation [Member] | |
Property, Plant and Equipment [Line Items] | |
Business Acquisition, Percentage of Voting Interests Acquired | 100.00% |
INVESTMENT IN MARKETABLE SECU25
INVESTMENT IN MARKETABLE SECURITIES (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | |
Investment - Corporate Equities | |||
Net Unrealized Loss | $ (362,000) | $ 305,000 | |
Fair Value | 5,052,000 | $ 5,874,000 | |
Equity Securities [Member] | |||
Investment - Corporate Equities | |||
Cost | 11,613,000 | 12,190,000 | |
Gross Unrealized Gain | 666,000 | 538,000 | |
Gross Unrealized Loss | (7,227,000) | (6,854,000) | |
Net Unrealized Loss | (6,561,000) | (6,316,000) | |
Fair Value | $ 5,052,000 | $ 5,874,000 |
INVESTMENT IN MARKETABLE SECU26
INVESTMENT IN MARKETABLE SECURITIES (Details 1) - USD ($) | 3 Months Ended | |
Sep. 30, 2017 | Sep. 30, 2016 | |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Realized gain (loss) on marketable securities | $ (75,000) | $ 120,000 |
Unrealized gain (loss) on marketable securities | (362,000) | 305,000 |
Net gain (loss) on marketable securities | $ (437,000) | $ 425,000 |
INVESTMENT IN MARKETABLE SECU27
INVESTMENT IN MARKETABLE SECURITIES (Details Textual) - USD ($) | 3 Months Ended | 12 Months Ended |
Sep. 30, 2017 | Jun. 30, 2017 | |
Schedule of Trading Securities and Other Trading Assets [Line Items] | ||
Trading Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss | $ 7,132,000 | $ 6,783,000 |
Percentage Of Investment Marketable Securities | 42.00% | 40.00% |
OTHER INVESTMENTS, NET (Details
OTHER INVESTMENTS, NET (Details) - USD ($) | Sep. 30, 2017 | Jun. 30, 2017 |
Other Investment [Line Items] | ||
Other investments, net | $ 696,000 | $ 696,000 |
Other Investments [Member] | ||
Other Investment [Line Items] | ||
Other investments, net | 211,000 | 211,000 |
Private equity hedge fund, at cost [Member] | ||
Other Investment [Line Items] | ||
Other investments, net | $ 485,000 | $ 485,000 |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) | Sep. 30, 2017 | Jun. 30, 2017 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in marketable securities | $ 5,052,000 | $ 5,874,000 |
Basic materials [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in marketable securities | 2,548,000 | 2,766,000 |
Technology [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in marketable securities | 1,324,000 | 1,386,000 |
Other [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in marketable securities | 785,000 | 1,033,000 |
Energy [Member] | Fair Value, Inputs, Level 1 [Member] | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Investment in marketable securities | $ 395,000 | $ 689,000 |
FAIR VALUE MEASUREMENTS (Deta30
FAIR VALUE MEASUREMENTS (Details 1) - USD ($) | 3 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Other non-marketable investments | $ 696,000 | $ 696,000 | |
Net loss | 0 | $ (10,000) | |
Other Investments [Member] | Fair Value, Inputs, Level 3 [Member] | |||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | |||
Other non-marketable investments | $ 696,000 | $ 696,000 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) - USD ($) | 3 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2016 | Jun. 30, 2017 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 14,522,000 | $ 14,695,000 | |
Segment operating expenses | (10,963,000) | (10,549,000) | |
Segment income (loss) | 2,861,000 | 3,462,000 | |
Interest expense - mortgage | (2,009,000) | (2,039,000) | |
Depreciation and amortization expense | (698,000) | (684,000) | |
Loss from investments | (505,000) | 370,000 | |
Income tax expense | (262,000) | (705,000) | |
Net income (loss) | 85,000 | 1,088,000 | |
Total assets | 70,453,000 | 72,334,000 | $ 71,283,000 |
Hotel Operations [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 14,437,000 | 14,605,000 | |
Segment operating expenses | (10,589,000) | (10,256,000) | |
Segment income (loss) | 3,848,000 | 4,349,000 | |
Interest expense - mortgage | (1,987,000) | (1,988,000) | |
Depreciation and amortization expense | (673,000) | (688,000) | |
Loss from investments | 0 | 0 | |
Income tax expense | 0 | 0 | |
Net income (loss) | 1,188,000 | 1,673,000 | |
Total assets | 47,021,000 | 47,207,000 | |
Real Estate Operations [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 85,000 | 90,000 | |
Segment operating expenses | (48,000) | (48,000) | |
Segment income (loss) | 37,000 | 42,000 | |
Interest expense - mortgage | (22,000) | (23,000) | |
Depreciation and amortization expense | (25,000) | (24,000) | |
Loss from investments | 0 | 0 | |
Income tax expense | 0 | 0 | |
Net income (loss) | (10,000) | (5,000) | |
Total assets | 4,989,000 | 5,091,000 | |
Investment Transactions [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 0 | 0 | |
Segment operating expenses | 0 | 0 | |
Segment income (loss) | 0 | 0 | |
Interest expense - mortgage | 0 | 0 | |
Depreciation and amortization expense | 0 | 0 | |
Loss from investments | (505,000) | 370,000 | |
Income tax expense | 0 | 0 | |
Net income (loss) | (505,000) | 370,000 | |
Total assets | 5,748,000 | 8,351,000 | |
Other Property [Member] | |||
Segment Reporting Information [Line Items] | |||
Revenues | 0 | 0 | |
Segment operating expenses | (326,000) | (245,000) | |
Segment income (loss) | (326,000) | (245,000) | |
Interest expense - mortgage | 0 | 0 | |
Depreciation and amortization expense | 0 | 0 | |
Loss from investments | 0 | 0 | |
Income tax expense | (262,000) | (705,000) | |
Net income (loss) | (588,000) | (950,000) | |
Total assets | $ 12,695,000 | $ 11,685,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Textual) - USD ($) | Feb. 03, 2017 | Jul. 02, 2014 | Apr. 30, 2017 | Sep. 30, 2017 | Jun. 30, 2017 | May 12, 2017 |
Related Party Transaction [Line Items] | ||||||
Management Fee Payable | $ 400,000 | |||||
Other Notes Payable | 10,129,000 | $ 10,209,000 | ||||
Management Agreement Term For Managing Hotel | 10 years | |||||
Key Money Incentive Advance To Related Party | 2,000,000 | |||||
Intergroup Corporation [Member] | Unsecured Debt [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | |||||
Debt Instrument, Maturity Date | Sep. 15, 2017 | |||||
Debt Instrument, Face Amount | $ 1,000,000 | |||||
Debt Instrument, Term | 5 months | |||||
Mezzanine Loan [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Guarantor Obligations, Current Carrying Value | $ 20,000,000 | |||||
Mortage loans [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Guarantor Obligations, Current Carrying Value | $ 97,000,000 | |||||
General Partner [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Other Notes Payable | 3,879,000 | $ 3,958,000 | ||||
Intergroup [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Payments of Ordinary Dividends, Noncontrolling Interest | $ 4,250,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 12.00% | |||||
Debt Instrument, Term | 2 years | |||||
Debt Instrument, Periodic Payment | $ 3 | |||||
Justice [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Payment for Management Fee | 1,550,000 | |||||
Accounts Payable, Related Parties | 116,000 | |||||
Interest Free Development Incentive Note [Member] | ||||||
Related Party Transaction [Line Items] | ||||||
Notes Reduction | $ 316,000 |