Document And Entity Information
Document And Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Oct. 31, 2015 | |
Entity Registrant Name | SB Partners | |
Entity Central Index Key | 87,047 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Entity Current Reporting Status | Yes | |
Entity Voluntary Filers | No | |
Entity Well-known Seasoned Issuer | No | |
Entity Common Stock, Shares Outstanding (in shares) | 0 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 | |
Amendment Flag | false |
Consolidated Balance Sheets (Cu
Consolidated Balance Sheets (Current Period Unaudited) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Assets: | ||
Land | $ 470,000 | $ 470,000 |
Buildings, furnishings and improvements | 5,016,186 | 4,866,973 |
Less - accumulated depreciation | (1,729,810) | (1,631,056) |
$ 3,756,376 | 3,705,917 | |
Real estate held for sale | $ 12,026,246 | |
Investment in Sentinel Omaha, LLC, net of reserve for fair value of $10,185,000 and $6,749,554 at September 30, 2015 and December 31, 2014, respectively | $ 10,185,000 | |
13,941,376 | $ 15,732,163 | |
Other Assets - | ||
Cash and cash equivalents | 1,319,894 | 933,373 |
Cash in escrow | 500,232 | 500,194 |
Other | $ 93,175 | 83,508 |
Other assets in discontinued operations | 22,549 | |
Total assets | $ 15,854,677 | 17,271,787 |
Liabilities: | ||
Unsecured loan payable | $ 5,986,888 | 9,953,036 |
Mortgage note in discontinued operations | 10,000,000 | |
Accounts payable | $ 309,107 | 292,993 |
Tenant security deposits | 94,419 | 93,021 |
Accrued expenses | $ 1,906,840 | 2,683,030 |
Other liabilities in discontinued operations | 25,000 | |
Total liabilities | $ 8,297,254 | 23,047,080 |
Partners' Equity (Deficit): | ||
Limited partner - 7,753 units | 7,574,884 | (5,756,112) |
General partner - 1 unit | (17,461) | (19,181) |
Total partners' equity (deficit) | 7,557,423 | (5,775,293) |
Total liabilities and partners' equity (deficit) | $ 15,854,677 | $ 17,271,787 |
Consolidated Balance Sheets (C3
Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Investment in Sentinel Omaha, LLC, reserve for fair value | $ 10,185,000 | $ 6,749,554 |
Limited partner - units (in shares) | 7,753 | 7,753 |
General partner - units (in shares) | 1 | 1 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenues: | ||||
Base rental income | $ 169,067 | $ 158,657 | $ 489,499 | $ 469,735 |
Other rental income | 87,936 | 120,669 | 263,808 | 330,295 |
Interest on short-term investments | 342 | 218 | 1,012 | 531 |
Total revenues | 257,345 | 279,544 | 754,319 | 800,561 |
Expenses: | ||||
Real estate operating expenses | 81,253 | 69,434 | 238,148 | 258,357 |
Interest on unsecured loan payable | 113,380 | 125,511 | 363,784 | 376,571 |
Depreciation and amortization | 40,850 | 45,126 | 115,132 | 135,378 |
Real estate taxes | 31,362 | 32,665 | 94,086 | 97,995 |
Management fees | 215,068 | 217,833 | 656,829 | 651,910 |
Other | 41,662 | 38,032 | 115,588 | 112,726 |
Total expenses | 523,575 | 528,601 | 1,583,567 | 1,632,937 |
Loss from operations | (266,230) | (249,057) | (829,248) | (832,376) |
Equity in net income of investment | 11,337,038 | 1,435,648 | 13,620,447 | 2,895,431 |
Reserve for value of investment | (1,152,038) | (1,435,648) | (3,435,447) | (2,895,431) |
Income (loss) from continuing operations | 9,918,770 | (249,057) | 9,355,752 | (832,376) |
Income from discontinued operations | 113,823 | $ 52,868 | 407,718 | $ 146,172 |
Gain on sale of investment in real estate | 3,569,246 | 3,569,246 | ||
Net income (loss) | 13,601,839 | $ (196,189) | 13,332,716 | $ (686,204) |
Income (loss) allocated to general partner | 1,754 | (25) | 1,720 | (89) |
Income (loss) allocated to limited partners | $ 13,600,085 | $ (196,164) | $ 13,330,996 | $ (686,115) |
Income (loss) per unit of limited partnership interest (basic and diluted) | ||||
Income (loss) from continuing operations (in dollars per share) | $ 1,279.35 | $ (32.12) | $ 1,206.73 | $ (107.36) |
Income from discontinued operations (including gain on sale) (in dollars per share) | 475.05 | 6.82 | 512.96 | 18.85 |
Net income (loss) (in dollars per share) | $ 1,754.40 | $ (25.30) | $ 1,719.68 | $ (88.51) |
Weighted Average Number of Units of Limited Partnership Interest Outstanding (in shares) | 7,753 | 7,753 | 7,753 | 7,753 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Partners' Equity (Deficit) (Unaudited) - 9 months ended Sep. 30, 2015 - USD ($) | Limited Partner [Member]Units of Partnership [Member] | Limited Partner [Member]Cumulative Cash Distributions [Member] | Limited Partner [Member]Retained Earnings [Member] | Limited Partner [Member] | General Partner [Member]Units of Partnership [Member] | General Partner [Member]Cumulative Cash Distributions [Member] | General Partner [Member]Retained Earnings [Member] | General Partner [Member] | Total |
Balance (in shares) at Dec. 31, 2014 | 7,753 | 1 | |||||||
Balance at Dec. 31, 2014 | $ 119,968,973 | $ (111,721,586) | $ (14,003,499) | $ (5,756,112) | $ 10,000 | $ (26,364) | $ (2,817) | $ (19,181) | $ (5,775,293) |
Net income for the period | 13,330,996 | 13,330,996 | 1,720 | 1,720 | 13,332,716 | ||||
Balance (in shares) at Sep. 30, 2015 | 7,753 | 1 | |||||||
Balance at Sep. 30, 2015 | $ 119,968,973 | $ (111,721,586) | $ (672,503) | $ 7,574,884 | $ 10,000 | $ (26,364) | $ (1,097) | $ (17,461) | $ 7,557,423 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash Flows From Operating Activities: | ||
Net income (loss) | $ 13,332,716 | $ (686,204) |
Adjustments to reconcile net income (loss) to net cash (used in) provided by operating activities: | ||
Equity in net (income) of investment | (13,620,447) | (2,895,431) |
Reserve for fair value of investment | 3,435,447 | $ 2,895,431 |
(Gain) on sale of investment in real estate | (3,569,246) | |
Depreciation and amortization | 117,100 | $ 402,060 |
Net (increase) decrease in operating assets | (5,464) | 11,370 |
Net (decrease) in accounts payable | (8,886) | (122,587) |
Net increase in tenant security deposits | 1,398 | 1,399 |
Net (decrease) increase in accrued expenses | (776,190) | 557,230 |
Net cash (used in) provided by operating activites | (1,093,572) | $ 163,268 |
Cash Flows From Investing Activities: | ||
Net proceeds from sale of investment in real estate owned | 15,595,492 | |
Interest earned on capital reserve escrow acount | (38) | $ (36) |
Capital additions to real estate owned | (149,213) | |
Net cash provided by (used in) investing activites | 15,446,241 | $ (36) |
Cash Flows From Financing Activities: | ||
Repayment of mortgage note in discontinued operations | (10,000,000) | |
Repayment of unsecured loan payable | (3,966,148) | $ (13,973) |
Net cash (used in) financing activities | (13,966,148) | (13,973) |
Net change in cash and cash equivalents | 386,521 | 149,259 |
Cash and cash equivalents at beginning of period | 933,373 | 624,191 |
Cash and cash equivalents at end of period | 1,319,894 | 773,450 |
Supplemental disclosure of cash flow information: | ||
Cash paid during the period for interest | $ 1,731,395 | $ 585,172 |
Note 1 - Organization and Signi
Note 1 - Organization and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2015 | |
Notes to Financial Statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure and Significant Accounting Policies [Text Block] | (1) ORGANIZATION AND SIGNIFICANT ACCOUNTING POLICIES SB Partners, a New York limited partnership, and its subsidiaries (collectively, the "Partnership" or the “Registrant”), have been engaged since April 1971 in acquiring, operating, and holding for investment a varying portfolio of real estate interests. SB Partners Real Estate Corporation (the "General Partner") serves as the general partner of the Partnership. The consolidated financial statements included herein are unaudited; however, the information reflects all adjustments (consisting of normal recurring adjustments) that are, in the opinion of management, necessary to a fair presentation of the financial position, results of operations and cash flows for the interim periods. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted pursuant to such rules and regulations, although management believes that the disclosures are adequate to make the information presented not misleading. It is suggested that these consolidated financial statements be read in conjunction with the consolidated financial statements and the notes thereto included in the Partnership’s latest annual report on Form 10-K. The results of operations for the three and nine month periods ended September 30, 2015 are not necessarily indicative of the results to be expected for a full year. For a discussion of the significant accounting and financial reporting policies of the Partnership, refer to the Annual Report on Form 10–K for the year ended December 31, 2014. |
Note 2 - Investments in Real Es
Note 2 - Investments in Real Estate | 9 Months Ended |
Sep. 30, 2015 | |
Notes to Financial Statements | |
Real Estate Disclosure [Text Block] | (2) INVESTMENTS IN REAL ESTATE As of September 30, 2015, the Partnership owns an industrial flex property in Maple Grove, Minnesota. The following is the cost basis and accumulated depreciation of the real estate investments owned by the Partnership at September 30, 2015 and December 31, 2014. See footnote 3 regarding the Partnership’s sale of the warehouse distribution property located in Lino Lakes, MN. No. of Year of Real Estate at Cost Type Prop. Acquisition Description 9/30/2015 12/31/2014 Industrial flex property 1 2002 60,345 sf $ 5,486,186 $ 5,336,973 Less: Accumulated depreciation (1,729,810 ) (1,631,056 ) Investment in real estate $ 3,756,376 $ 3,705,917 Real estate held for sale: Warehouse distribution property 1 2005 226,000 sf $ - $ 12,026,246 |
Note 3 - Real Estate Held for S
Note 3 - Real Estate Held for Sale | 9 Months Ended |
Sep. 30, 2015 | |
Notes to Financial Statements | |
Real Estate Held for Sale [Text Block] | (3) REAL ESTATE TRANSACTION During February 2015 the Partnership initiated a sales effort for Lino Lakes, its warehouse distribution property located in Lino Lakes, MN. On September 17, 2015, the Partnership sold Lino Lakes for $16,050,000 in an all cash transaction. The net proceeds from the sale were used, in part, to retire the mortgage note of $10,000,000 that had been secured by the property and to pay down the Partnership’s unsecured loan (see Note 5). The carrying value at the time of the sale was $12,026,246 which resulted in a net gain for financial reporting purposes of $3,569,246 after closing costs of $454,508. The closing costs of $454,508 included a sale commission of $80,250 paid to an affiliate of the general partner. The historical cost of the property at the time of the sale was $15,296,036. The assets and liabilities for this property at December 31, 2014 are reflected as assets and liabilities from discontinued operations in the accompanying consolidated balance sheets and the results of operations for the three and nine months ended September 30, 2015 and 2014 are reflected as income from discontinued operations in the accompanying consolidated statements of operations. |
Note 4 - Investment in Sentinel
Note 4 - Investment in Sentinel Omaha, LLC | 9 Months Ended |
Sep. 30, 2015 | |
Notes to Financial Statements | |
Equity Method Investments and Joint Ventures Disclosure [Text Block] | (4) INVESTMENT IN SENTINEL OMAHA, LLC In 2007, the Partnership made an investment in the amount of $37,200,000 in Sentinel Omaha, LLC (“Omaha”). Omaha is a real estate investment company which as of September 30, 2015 owns 14 multifamily properties in 10 markets. Omaha is an affiliate of the Registrant’s general partner. The investment represents a 30% ownership interest in Omaha. The following are the condensed financial statements (000’s omitted) of Omaha as of and for the periods ended September 30, 2015 and December 31, 2014. (Unaudited) (Audited) Balance Sheet September 30, 2015 December 31, 2014 Investment in real estate, net $ 328,400 $ 283,300 Other assets 11,826 11,707 Debt (267,865 ) (267,495 ) Other liabilities (4,461 ) (5,013 ) Member's equity $ 67,900 $ 22,499 (Unaudited) Statement of Operations September 30, 2015 Rent and other income $ 31,052 Real estate operating expenses (15,399 ) Other expenses (11,906 ) Net unrealized income 41,654 Net income $ 45,401 |
Note 5 - Mortgage Note and Unse
Note 5 - Mortgage Note and Unsecured Loan Payable | 9 Months Ended |
Sep. 30, 2015 | |
Notes to Financial Statements | |
Debt Disclosure [Text Block] | (5) MORTGAGE NOTE AND UNSECURED LOAN PAYABLE Mortgage notes and unsecured loan payable consist of the following non-recourse first liens: Annual Net Carrying Amount Interest Installment Amount Due September 30, December 31, Property Rate Maturity Date Payments at Maturity 2015 2014 Unsecured loan payable: Bank Loan (b): Note A $ - $ 3,953,036 Note B 5,986,888 6,000,000 $ 5,986,888 $ 9,953,036 Mortgage note in discontinued operations: Lino Lakes 5.800 % October, 2015 $ 580,000 (a) $ 10,000,000 $ - $ 10,000,000 (a) Annual installment payments include interest only. The mortgage note was retired on September 17, 2015 in conjunction with the sale of Lino Lakes. (b) On September 17, 2007, the Partnership entered into a bank loan (the “Loan”) with a bank (“Holder”) in the amount of $22,000,000, which matured on October 1, 2008. On April 29, 2011, the Partnership and Holder executed the new loan agreement (“Loan Agreement”) on the following terms: 1) In connection with the execution of the Loan Agreement, the Partnership was required to make an immediate payment to Holder of $11,930,430, reducing the balance due under the unsecured credit facility to $10,069,570. The payment was made from proceeds resulting from the sale of 175 Ambassador Drive. Additional proceeds from the sale were used to pay Holder’s legal and appraisal costs and to fund a reserve account for future tenant improvement and leasing costs, as needed. The remaining outstanding obligation in the amount of $10,069,570 was divided into two notes (“Note A” and “Note B;” together, the “Notes”). 7 2) Note A which had a balance of $3,768,751 as of September 18, 2015 was paid off in full using proceeds from the sale of Lino Lakes. 3) Note B in the amount of $5,986,888 has a maturity date of April 29, 2018. The Partnership has three 1-year options to extend the maturity date if certain conditions are satisfied. Note B previously accrued interest at an annual fixed rate of 5% but only until all interest and principal had been paid in full on Note A. Accrued interest related to Note B in the amount of $1,335,833 was paid off in full on September 18, 2015 using sales proceeds from the sale of Lino Lakes. Thereafter Note B does not accrue any interest. Payments of principal are deferred until Registrant’s investment in Sentinel Omaha LLC (“Omaha”) pays distributions to the Partnership or the Partnership sells Eagle Lake Business Center IV or its investment in Omaha. Distributions from Omaha or net proceeds from the sale of Eagle IV or Omaha would be used first to pay the outstanding principal balance of Note B. If there are no distributions from Omaha prior to the Note B maturity, principal is due at maturity, subject to the above mentioned extensions. As of September 30, 2015 and December 31, 2014, $0 and $1,113,339, respectively of Note B interest has been accrued and is included in accrued expenses on the balance sheet. 4) Note B may be voluntarily prepaid upon notice to the Holder, subject to certain requirements as to the application of payments. The Partnership’s obligations under the Notes may be accelerated upon default. 5) Until the Partnership’s obligations under Note B are satisfied in full, the Partnership is required to pay a portion of its net operating income (after payment of certain permitted expenses), and the net proceeds from the sale, transfer or refinancing of its remaining property and investment, toward Note B while retaining the other portion to increase cash reserves. While the obligations under Note B are outstanding the Partnership is precluded from making distributions to its partners. 6) The Partnership, its general partner and the Holder also entered into a Management Subordination Agreement accruing a portion of the investment management fee payable by the Partnership to its general partner so long as the Notes remain outstanding. As of September 30, 2015 and December 31, 2014, $1,906,840 and 1,569,691, respectively of investment management fees have been accrued and are included in accrued expenses on the balance sheet. As additional security for the Partnership’s payment of its obligations under the Loan Agreement, the Partnership, through its wholly-owned subsidiary Eagle IV Realty, LLC, has executed a Mortgage, Security Agreement, Assignment of Leases and Rents and Fixture Financing Statement (“Eagle IV Security Agreement”) and a Pledge Agreement (“Eagle IV Pledge Agreement”) in favor of Holder. The Eagle IV Security Agreement provides Holder with a security interest on the Partnership’s property located in Maple Grove, Minnesota (“Eagle IV”) of up to $5,000,000. The Eagle IV Pledge Agreement pledges to Holder the Partnership’s membership interest in Eagle IV Realty, LLC, the direct owner of Eagle IV. The Partnership has no other debt obligation secured by Eagle IV. The Loan Agreement also provides for a negative pledge on the Partnership’s remaining properties and investments. |
Note 2 - Investments in Real 12
Note 2 - Investments in Real Estate (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Notes Tables | |
Schedule of Real Estate Properties [Table Text Block] | No. of Year of Real Estate at Cost Type Prop. Acquisition Description 9/30/2015 12/31/2014 Industrial flex property 1 2002 60,345 sf $ 5,486,186 $ 5,336,973 Less: Accumulated depreciation (1,729,810 ) (1,631,056 ) Investment in real estate $ 3,756,376 $ 3,705,917 Real estate held for sale: Warehouse distribution property 1 2005 226,000 sf $ - $ 12,026,246 |
Note 4 - Investment in Sentin13
Note 4 - Investment in Sentinel Omaha, LLC (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Statement of Operations [Member] | |
Notes Tables | |
Real Estate Investment Financial Statements, Disclosure [Table Text Block] | (Unaudited) Statement of Operations September 30, 2015 Rent and other income $ 31,052 Real estate operating expenses (15,399 ) Other expenses (11,906 ) Net unrealized income 41,654 Net income $ 45,401 |
Balance Sheet [Member] | |
Notes Tables | |
Real Estate Investment Financial Statements, Disclosure [Table Text Block] | (Unaudited) (Audited) Balance Sheet September 30, 2015 December 31, 2014 Investment in real estate, net $ 328,400 $ 283,300 Other assets 11,826 11,707 Debt (267,865 ) (267,495 ) Other liabilities (4,461 ) (5,013 ) Member's equity $ 67,900 $ 22,499 |
Note 5 - Mortgage Note and Un14
Note 5 - Mortgage Note and Unsecured Loan Payable (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Notes Tables | |
Schedule of Long-term Debt Instruments [Table Text Block] | Annual Net Carrying Amount Interest Installment Amount Due September 30, December 31, Property Rate Maturity Date Payments at Maturity 2015 2014 Unsecured loan payable: Bank Loan (b): Note A $ - $ 3,953,036 Note B 5,986,888 6,000,000 $ 5,986,888 $ 9,953,036 Mortgage note in discontinued operations: Lino Lakes 5.800 % October, 2015 $ 580,000 (a) $ 10,000,000 $ - $ 10,000,000 |
Note 2 - Investments in Real 15
Note 2 - Investments in Real Estate - Summary of Investments in Real Estate (Details) | 9 Months Ended | |
Sep. 30, 2015USD ($)a | Dec. 31, 2014USD ($) | |
Industrial Flex Property [Member] | ||
Industrial flex property | 1 | |
Industrial flex property | 2,002 | |
Industrial flex property | a | 60,345 | |
Real Estate Investment Property, at Cost | $ 5,486,186 | $ 5,336,973 |
Warehouse Distribution Properties [Member] | ||
Industrial flex property | 1 | |
Industrial flex property | 2,005 | |
Industrial flex property | a | 226,000 | |
Real Estate Investment Property, at Cost | 12,026,246 | |
Less: Accumulated depreciation | $ (1,729,810) | (1,631,056) |
Investment in real estate | $ 3,756,376 | $ 3,705,917 |
Note 3 - Real Estate Held for16
Note 3 - Real Estate Held for Sale (Details Textual) - USD ($) | Sep. 17, 2015 | Jul. 20, 2015 | Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 |
Property, Plant and Equipment, Disposals | $ 16,050,000 | ||||||
Repayments of Long-term Debt | $ 10,000,000 | $ 10,000,000 | |||||
Real Estate Held-for-sale | 12,026,246 | $ 12,026,246 | |||||
Gains (Losses) on Sales of Investment Real Estate | 3,569,246 | $ 3,569,246 | $ 3,569,246 | ||||
Closing Costs | 454,508 | ||||||
Sales Commissions and Fees | 80,250 | ||||||
Real Estate Investment Property, at Cost | $ 15,296,036 |
Note 4 - Investment in Sentin17
Note 4 - Investment in Sentinel Omaha, LLC (Details Textual) - Sentinel Omaha LLC [Member] | Sep. 30, 2015 | Dec. 31, 2007USD ($) |
Investment Owned, at Cost | $ 37,200,000 | |
Number of Multifamily Properties | 14 | |
Number of Markets | 10 | |
Equity Method Investment, Ownership Percentage | 30.00% |
Note 4 - Investment in Sentin18
Note 4 - Investment in Sentinel Omaha, LLC - Condensed Balance Sheet (Current Period Unaudited) (Details) - USD ($) | Sep. 30, 2015 | Dec. 31, 2014 |
Sentinel Omaha LLC [Member] | ||
Investment in real estate, net | $ 328,400 | $ 283,300 |
Other assets | 11,826 | 11,707 |
Debt | (267,865) | (267,495) |
Other liabilities | (4,461) | (5,013) |
Member's equity | 67,900 | 22,499 |
Other assets | $ 93,175 | $ 83,508 |
Note 4 - Investment in Sentin19
Note 4 - Investment in Sentinel Omaha, LLC - Condensed Statement of Operations (Unaudited) (Details) | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Sentinel Omaha LLC [Member] | |
Rent and other income | $ 31,052 |
Real estate operating expenses | (15,399) |
Other expenses | (11,906) |
Net unrealized income | 41,654 |
Net income (loss) | 45,401 |
Rent and other income | 754,319 |
Real estate operating expenses | (238,148) |
Other expenses | (115,588) |
Net income (loss) | $ 13,332,716 |
Note 5 - Mortgage Note and Un20
Note 5 - Mortgage Note and Unsecured Loan Payable (Details Textual) | Apr. 29, 2011USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 18, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 17, 2007USD ($) | |||
Notes Payable to Banks [Member] | Note B [Member] | |||||||||
Original Maturity Date | Apr. 29, 2018 | ||||||||
Long-term Debt | [1] | $ 5,986,888 | $ 6,000,000 | ||||||
Number of Extension Options | 3 | ||||||||
Term of Extension Options | 1 year | ||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ||||||||
Interest Payable | $ 0 | $ 1,335,833 | 1,113,339 | ||||||
Notes Payable to Banks [Member] | Note A [Member] | |||||||||
Long-term Debt | $ 3,768,751 | 3,953,036 | [1] | ||||||
Notes Payable to Banks [Member] | |||||||||
Debt Instrument, Face Amount | $ 22,000,000 | ||||||||
Repayments of Unsecured Debt | $ 11,930,430 | ||||||||
Long-term Debt | $ 10,069,570 | 5,986,888 | [1] | 9,953,036 | [1] | ||||
Management Fee Payable | 1,906,840 | $ 1,569,691 | |||||||
Security Interest on Partnership's Property Maximum | 5,000,000 | ||||||||
Repayments of Unsecured Debt | $ 3,966,148 | $ 13,973 | |||||||
[1] | On September 17, 2007, the Partnership entered into a bank loan (the "Loan") with a bank ("Holder") in the amount of $22,000,000, which matured on October 1, 2008. On April 29, 2011, the Partnership and Holder executed the new loan agreement ("Loan Agreement") on the following terms: 1) In connection with the execution of the Loan Agreement, the Partnership was required to make an immediate payment to Holder of $11,930,430, reducing the balance due under the unsecured credit facility to $10,069,570. The payment was made from proceeds resulting from the sale of 175 Ambassador Drive. Additional proceeds from the sale were used to pay Holder's legal and appraisal costs and to fund a reserve account for future tenant improvement and leasing costs, as needed. The remaining outstanding obligation in the amount of $10,069,570 was divided into two notes ("Note A" and "Note B;" together, the "Notes"). 2) Note A which had a balance of $3,768,751 as of September 18, 2015 was paid off in full using proceeds from the sale of Lino Lakes. 3) Note B in the amount of $5,986,888 has a maturity date of April 29, 2018. The Partnership has three 1-year options to extend the maturity date if certain conditions are satisfied. Note B previously accrued interest at an annual fixed rate of 5% but only until all interest and principal had been paid in full on Note A. Accrued interest related to Note B in the amount of $1,335,833 was paid off in full on September 18, 2015 using sales proceeds from the sale of Lino Lakes. Thereafter Note B does not accrue any interest. Payments of principal are deferred until Registrant's investment in Sentinel Omaha LLC ("Omaha") pays distributions to the Partnership or the Partnership sells Eagle Lake Business Center IV or its investment in Omaha. Distributions from Omaha or net proceeds from the sale of Eagle IV or Omaha would be used first to pay the outstanding principal balance of Note B. If there are no distributions from Omaha prior to the Note B maturity, principal is due at maturity, subject to the above mentioned extensions. As of September 30, 2015 and December 31, 2014, $0 and $1,113,339, respectively of Note B interest has been accrued and is included in accrued expenses on the balance sheet. 4) Note B may be voluntarily prepaid upon notice to the Holder, subject to certain requirements as to the application of payments. The Partnership's obligations under the Notes may be accelerated upon default. 5) Until the Partnership's obligations under Note B are satisfied in full, the Partnership is required to pay a portion of its net operating income (after payment of certain permitted expenses), and the net proceeds from the sale, transfer or refinancing of its remaining properties and investments, toward Note B while retaining the other portion to increase cash reserves. While the obligations under Note B are outstanding the Partnership is precluded from making distributions to its partners. 6) The Partnership, its general partner and the Holder also entered into a Management Subordination Agreement accruing a portion of the investment management fee payable by the Partnership to its general partner so long as the Notes remain outstanding. As of September 30, 2015 and December 31, 2014, $1,906,840 and 1,569,691, respectively of investment management fees have been accrued and are included in accrued expenses on the balance sheet. |
Note 5 - Mortgage Note and Un21
Note 5 - Mortgage Note and Unsecured Loan Payable - Summary of Notes and Loans Payable (Details) - USD ($) | 9 Months Ended | ||
Sep. 30, 2015 | Dec. 31, 2014 | ||
Note A [Member] | Notes Payable to Banks [Member] | |||
Long-term Debt | [1] | $ 3,953,036 | |
Note B [Member] | Notes Payable to Banks [Member] | |||
Long-term Debt | [1] | $ 5,986,888 | 6,000,000 |
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | ||
Lino Lakes [Member] | Mortgages [Member] | |||
Long-term Debt | 10,000,000 | ||
Debt Instrument, Interest Rate, Stated Percentage | 5.80% | ||
Long-term debt | [2] | $ 580,000 | |
Debt Instrument, Face Amount | 10,000,000 | ||
Notes Payable to Banks [Member] | |||
Long-term Debt | [1] | $ 5,986,888 | $ 9,953,036 |
[1] | On September 17, 2007, the Partnership entered into a bank loan (the "Loan") with a bank ("Holder") in the amount of $22,000,000, which matured on October 1, 2008. On April 29, 2011, the Partnership and Holder executed the new loan agreement ("Loan Agreement") on the following terms: 1) In connection with the execution of the Loan Agreement, the Partnership was required to make an immediate payment to Holder of $11,930,430, reducing the balance due under the unsecured credit facility to $10,069,570. The payment was made from proceeds resulting from the sale of 175 Ambassador Drive. Additional proceeds from the sale were used to pay Holder's legal and appraisal costs and to fund a reserve account for future tenant improvement and leasing costs, as needed. The remaining outstanding obligation in the amount of $10,069,570 was divided into two notes ("Note A" and "Note B;" together, the "Notes"). 2) Note A which had a balance of $3,768,751 as of September 18, 2015 was paid off in full using proceeds from the sale of Lino Lakes. 3) Note B in the amount of $5,986,888 has a maturity date of April 29, 2018. The Partnership has three 1-year options to extend the maturity date if certain conditions are satisfied. Note B previously accrued interest at an annual fixed rate of 5% but only until all interest and principal had been paid in full on Note A. Accrued interest related to Note B in the amount of $1,335,833 was paid off in full on September 18, 2015 using sales proceeds from the sale of Lino Lakes. Thereafter Note B does not accrue any interest. Payments of principal are deferred until Registrant's investment in Sentinel Omaha LLC ("Omaha") pays distributions to the Partnership or the Partnership sells Eagle Lake Business Center IV or its investment in Omaha. Distributions from Omaha or net proceeds from the sale of Eagle IV or Omaha would be used first to pay the outstanding principal balance of Note B. If there are no distributions from Omaha prior to the Note B maturity, principal is due at maturity, subject to the above mentioned extensions. As of September 30, 2015 and December 31, 2014, $0 and $1,113,339, respectively of Note B interest has been accrued and is included in accrued expenses on the balance sheet. 4) Note B may be voluntarily prepaid upon notice to the Holder, subject to certain requirements as to the application of payments. The Partnership's obligations under the Notes may be accelerated upon default. 5) Until the Partnership's obligations under Note B are satisfied in full, the Partnership is required to pay a portion of its net operating income (after payment of certain permitted expenses), and the net proceeds from the sale, transfer or refinancing of its remaining properties and investments, toward Note B while retaining the other portion to increase cash reserves. While the obligations under Note B are outstanding the Partnership is precluded from making distributions to its partners. 6) The Partnership, its general partner and the Holder also entered into a Management Subordination Agreement accruing a portion of the investment management fee payable by the Partnership to its general partner so long as the Notes remain outstanding. As of September 30, 2015 and December 31, 2014, $1,906,840 and 1,569,691, respectively of investment management fees have been accrued and are included in accrued expenses on the balance sheet. | ||
[2] | Annual installment payments include interest only. The mortgage note was retired on September 17, 2015 in conjunction with the sale of Lino Lakes. |