Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2017 | Aug. 04, 2017 | |
Document and Entity Information | ||
Entity Registrant Name | CIM Commercial Trust Corp | |
Entity Central Index Key | 908,311 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2017 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 57,875,848 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
ASSETS | ||
Investments in real estate, net | $ 1,141,460 | $ 1,606,942 |
Cash and cash equivalents | 129,006 | 144,449 |
Restricted cash | 26,706 | 32,160 |
Accounts receivable, net | 15,511 | 13,086 |
Deferred rent receivable and charges, net | 95,369 | 116,354 |
Other intangible assets, net | 15,610 | 17,623 |
Other assets | 89,155 | 92,270 |
Assets held for sale, net | 125,138 | 0 |
TOTAL ASSETS | 1,637,955 | 2,022,884 |
LIABILITIES: | ||
Debt, net | 846,833 | 967,886 |
Accounts payable and accrued expenses | 42,287 | 39,155 |
Intangible liabilities, net | 1,138 | 3,576 |
Due to related parties | 10,005 | 10,196 |
Other liabilities | 31,275 | 34,056 |
Liabilities associated with assets held for sale, net | 52,886 | 0 |
Total liabilities | 984,424 | 1,054,869 |
COMMITMENTS AND CONTINGENCIES (Note 16) | ||
REDEEMABLE PREFERRED STOCK: Series A, $0.001 par value; 36,000,000 shares authorized; 308,775 and 61,435 shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively; liquidation preference of $25.00 per share | 7,050 | 1,426 |
EQUITY: | ||
Common stock, $0.001 par value; 900,000,000 shares authorized; 57,875,848 and 84,048,081 shares issued and outstanding at June 30, 2017 and December 31, 2016, respectively | 58 | 84 |
Additional paid-in capital | 1,077,151 | 1,566,073 |
Accumulated other comprehensive income (loss) | 603 | (509) |
Distributions in excess of earnings | (432,220) | (599,971) |
Total stockholders' equity | 645,592 | 965,677 |
Noncontrolling interests | 889 | 912 |
Total equity | 646,481 | 966,589 |
TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK AND EQUITY | $ 1,637,955 | $ 2,022,884 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2017 | Dec. 31, 2016 |
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 900,000,000 | 900,000,000 |
Common stock, shares issued | 57,875,848 | 84,048,081 |
Common stock, shares outstanding | 57,875,848 | 84,048,081 |
Series A Preferred Stock | ||
Redeemable preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Redeemable preferred stock, shares authorized | 36,000,000 | 36,000,000 |
Redeemable preferred stock, shares issued | 308,775 | 61,435 |
Redeemable preferred stock, shares outstanding | 308,775 | 61,435 |
Redeemable preferred stock, liquidation preference per share (in usd per share) | $ 25 | $ 25 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
REVENUES: | ||||
Rental and other property income | $ 55,956,000 | $ 61,624,000 | $ 116,765,000 | $ 124,472,000 |
Expense reimbursements | 2,526,000 | 3,316,000 | 5,556,000 | 6,244,000 |
Interest and other income | 2,817,000 | 3,420,000 | 5,927,000 | 6,261,000 |
REVENUES | 61,299,000 | 68,360,000 | 128,248,000 | 136,977,000 |
EXPENSES: | ||||
Rental and other property operating | 27,249,000 | 32,299,000 | 50,209,000 | 63,577,000 |
Asset management and other fees to related parties | 7,863,000 | 8,376,000 | 16,563,000 | 17,007,000 |
Interest | 9,513,000 | 7,295,000 | 19,286,000 | 14,110,000 |
General and administrative | 1,647,000 | 2,131,000 | 3,326,000 | 4,073,000 |
Transaction costs | 11,615,000 | 118,000 | 11,628,000 | 267,000 |
Depreciation and amortization | 14,761,000 | 18,480,000 | 31,992,000 | 36,538,000 |
Impairment of real estate | 13,100,000 | 0 | 13,100,000 | 0 |
EXPENSES | 85,748,000 | 68,699,000 | 146,104,000 | 135,572,000 |
Gain on sale of real estate | 116,283,000 | 0 | 304,017,000 | 24,739,000 |
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES | 91,834,000 | (339,000) | 286,161,000 | 26,144,000 |
Provision for income taxes | 462,000 | 471,000 | 854,000 | 661,000 |
NET INCOME (LOSS) FROM CONTINUING OPERATIONS | 91,372,000 | (810,000) | 285,307,000 | 25,483,000 |
DISCONTINUED OPERATIONS: | ||||
Income from operations of assets held for sale | 0 | 1,668,000 | 0 | 2,358,000 |
NET INCOME FROM DISCONTINUED OPERATIONS | 0 | 1,668,000 | 0 | 2,358,000 |
NET INCOME | 91,372,000 | 858,000 | 285,307,000 | 27,841,000 |
Net income attributable to noncontrolling interests | (9,000) | (9,000) | (14,000) | (12,000) |
NET INCOME ATTRIBUTABLE TO THE COMPANY | 91,363,000 | 849,000 | 285,293,000 | 27,829,000 |
Redeemable preferred stock dividends | (72,000) | 0 | (103,000) | 0 |
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ 91,291,000 | $ 849,000 | $ 285,190,000 | $ 27,829,000 |
BASIC AND DILUTED NET INCOME (LOSS) AVAILABLE TO COMMON STOCKHOLDERS PER SHARE: | ||||
Continuing operations (in usd per share) | $ 1.16 | $ (0.01) | $ 3.50 | $ 0.26 |
Discontinued operations (in usd per share) | 0 | 0.02 | 0 | 0.02 |
Net income (in usd per share) | $ 1.16 | $ 0.01 | $ 3.50 | $ 0.29 |
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING: | ||||
Basic (in shares) | 78,871 | 96,683 | 81,445 | 97,173 |
Diluted (in shares) | 78,871 | 96,683 | 81,445 | 97,173 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
NET INCOME | $ 91,372 | $ 858 | $ 285,307 | $ 27,841 |
Other comprehensive income (loss): cash flow hedges | (440) | (2,445) | 1,112 | (10,370) |
COMPREHENSIVE INCOME (LOSS) | 90,932 | (1,587) | 286,419 | 17,471 |
Comprehensive income attributable to noncontrolling interests | (9) | (9) | (14) | (12) |
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY | $ 90,923 | $ (1,596) | $ 286,405 | $ 17,459 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income (Loss) | Distributions in Excess of Earnings | Noncontrolling Interests |
Beginning balance (in shares) at Dec. 31, 2015 | 97,589,598 | |||||
Beginning balance at Dec. 31, 2015 | $ 1,297,347 | $ 98 | $ 1,820,451 | $ (2,519) | $ (521,620) | $ 937 |
Increase (Decrease) in Stockholders' Equity | ||||||
Distributions to noncontrolling interests | (36) | (36) | ||||
Stock-based compensation expense (in shares) | 10,176 | |||||
Stock-based compensation expense | 65 | 65 | ||||
Issuance of shares pursuant to employment agreements (in shares) | 76,423 | |||||
Share repurchase (in shares) | (10,000,000) | |||||
Share repurchase | (210,332) | $ (10) | (186,781) | (23,541) | ||
Common dividends | (40,544) | (40,544) | ||||
Other comprehensive income (loss) | (10,370) | (10,370) | ||||
Net income | 27,841 | 27,829 | 12 | |||
Ending balance (in shares) at Jun. 30, 2016 | 87,676,197 | |||||
Ending balance at Jun. 30, 2016 | 1,063,971 | $ 88 | 1,633,735 | (12,889) | (557,876) | 913 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 858 | |||||
Ending balance (in shares) at Jun. 30, 2016 | 87,676,197 | |||||
Ending balance at Jun. 30, 2016 | 1,063,971 | $ 88 | 1,633,735 | (12,889) | (557,876) | 913 |
Beginning balance (in shares) at Dec. 31, 2016 | 84,048,081 | |||||
Beginning balance at Dec. 31, 2016 | 966,589 | $ 84 | 1,566,073 | (509) | (599,971) | 912 |
Increase (Decrease) in Stockholders' Equity | ||||||
Distributions to noncontrolling interests | (37) | (37) | ||||
Stock-based compensation expense (in shares) | 9,585 | |||||
Stock-based compensation expense | 78 | 78 | ||||
Share repurchase (in shares) | (26,181,818) | |||||
Share repurchase | (576,000) | $ (26) | (489,027) | (86,947) | ||
Special cash dividends paid to certain common stockholders | (4,872) | (4,872) | ||||
Common dividends | (25,620) | (25,620) | ||||
Issuance of Warrants | 27 | 27 | ||||
Dividends to holders of Series A Preferred Stock | (103) | (103) | ||||
Other comprehensive income (loss) | 1,112 | 1,112 | ||||
Net income | 285,307 | 285,293 | 14 | |||
Ending balance (in shares) at Jun. 30, 2017 | 57,875,848 | |||||
Ending balance at Jun. 30, 2017 | 646,481 | $ 58 | 1,077,151 | 603 | (432,220) | 889 |
Increase (Decrease) in Stockholders' Equity | ||||||
Net income | 91,372 | |||||
Ending balance (in shares) at Jun. 30, 2017 | 57,875,848 | |||||
Ending balance at Jun. 30, 2017 | $ 646,481 | $ 58 | $ 1,077,151 | $ 603 | $ (432,220) | $ 889 |
Consolidated Statements of Equ7
Consolidated Statements of Equity (Parenthetical) - $ / shares | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Stockholders' Equity [Abstract] | ||
Special cash dividends paid to certain common stockholders (in usd per share) | $ 2.26 | |
Common dividends (in usd per share) | 0.34375 | $ 0.4375 |
Dividends to holders of Series A Preferred Stock (in usd per share) | $ 0.6875 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | |||||
Net income | $ 91,372,000 | $ 858,000 | $ 285,307,000 | $ 27,841,000 | |
Adjustments to reconcile net income to net cash provided by operating activities: | |||||
Deferred rent and amortization of intangible assets, liabilities and lease inducements | (2,662,000) | (2,637,000) | |||
Depreciation and amortization | 14,761,000 | 18,480,000 | 31,992,000 | 36,538,000 | |
Transfer of right to collect supplemental real estate tax reimbursements | (5,097,000) | 0 | |||
Gain on sale of real estate | (116,283,000) | 0 | (304,017,000) | (24,739,000) | |
Impairment of real estate | 13,100,000 | 0 | 13,100,000 | 0 | |
Straight line rent, below-market ground lease and amortization of intangible assets | 881,000 | 885,000 | |||
Amortization of deferred loan costs | 808,000 | 1,967,000 | |||
Amortization of premiums and discounts on debt | (458,000) | (543,000) | |||
Unrealized premium adjustment | 722,000 | 835,000 | |||
Amortization and accretion on loans receivable, net | 140,000 | (419,000) | |||
Bad debt expense (recovery) | 187,000 | (60,000) | |||
Deferred income taxes | 459,000 | 76,000 | |||
Stock-based compensation | 78,000 | 65,000 | |||
Loans funded, held for sale to secondary market | (17,906,000) | (22,105,000) | |||
Proceeds from sale of guaranteed loans | 16,737,000 | 21,579,000 | |||
Principal collected on loans subject to secured borrowings | 4,935,000 | 1,883,000 | |||
Other operating activity | (441,000) | 1,020,000 | |||
Changes in operating assets and liabilities: | |||||
Accounts receivable and interest receivable | (2,682,000) | (1,574,000) | |||
Other assets | (1,653,000) | (1,107,000) | |||
Accounts payable and accrued expenses | 5,631,000 | (1,779,000) | |||
Deferred leasing costs | (2,557,000) | (6,532,000) | |||
Other liabilities | (1,748,000) | 2,063,000 | |||
Due to related parties | 4,000 | 301,000 | |||
Net cash provided by operating activities | 21,760,000 | 33,558,000 | |||
CASH FLOWS FROM INVESTING ACTIVITIES: | |||||
Additions to investments in real estate | (9,915,000) | (18,121,000) | |||
Proceeds from sale of real estate property, net | 642,886,000 | 42,782,000 | |||
Loans funded | (5,969,000) | (27,871,000) | |||
Principal collected on loans | 5,496,000 | 26,164,000 | |||
Restricted cash | 5,403,000 | (76,956,000) | |||
Other investing activity | 67,000 | 1,042,000 | |||
Net cash provided by (used in) investing activities | 637,968,000 | (52,960,000) | |||
CASH FLOWS FROM FINANCING ACTIVITIES: | |||||
(Payment of) proceeds from mortgages payable | (65,569,000) | 309,170,000 | |||
Payment of unsecured revolving lines of credit, revolving credit facilities and term notes | 0 | (107,000,000) | |||
Payment of principal on secured borrowings | (4,935,000) | (11,965,000) | |||
Proceeds from secured borrowings | 0 | 9,956,000 | |||
Payment of deferred preferred stock offering costs | (862,000) | (362,000) | |||
Payment of deferred loan costs | (4,000) | (1,076,000) | |||
Payment of common dividends | (25,620,000) | (40,544,000) | |||
Payment of special cash dividends | (4,872,000) | 0 | |||
Repurchase of Common Stock | (576,000,000) | (210,060,000) | |||
Net proceeds from issuance of Warrants | 27,000 | 0 | $ 32,000 | ||
Net proceeds from issuance of Series A Preferred Stock | 5,645,000 | 0 | |||
Payment of preferred stock dividends | (40,000) | 0 | |||
Noncontrolling interests' distributions | (37,000) | (36,000) | |||
Net cash used in financing activities | (672,267,000) | (51,917,000) | |||
Change in cash balances included in assets held for sale | (2,904,000) | (14,265,000) | |||
NET DECREASE IN CASH AND CASH EQUIVALENTS | (15,443,000) | (85,584,000) | |||
CASH AND CASH EQUIVALENTS: | |||||
Beginning of period | 144,449,000 | 139,101,000 | 53,517,000 | ||
End of period | 129,006,000 | 53,517,000 | 129,006,000 | 53,517,000 | 129,006,000 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | |||||
Cash paid during the period for interest | 19,303,000 | 13,717,000 | |||
Federal income taxes paid | 259,000 | 50,000 | |||
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES: | |||||
Additions to investments in real estate included in accounts payable and accrued expenses | 6,883,000 | 9,392,000 | |||
Net increase (decrease) in fair value of derivatives applied to other comprehensive income (loss) | (440,000) | (2,445,000) | 1,112,000 | (10,370,000) | |
Reduction of loans receivable and secured borrowings due to the SBA's repurchase of the guaranteed portion of a loan | 534,000 | 2,663,000 | |||
Additions to deferred loan costs included in accounts payable and accrued expenses | 0 | 626,000 | |||
Expenses related to repurchase of common stock included in accounts payable and accrued expenses | 0 | 272,000 | |||
Proceeds receivable from closed mortgage loans included in other assets | 0 | 80,687,000 | |||
Additions to preferred stock offering costs included in accounts payable and accrued expenses | 1,387,000 | 984,000 | |||
Accrual of dividends payable to preferred stockholders | $ 72,000 | $ 0 | 72,000 | 0 | $ 72,000 |
Preferred stock offering costs offset against redeemable preferred stock | $ 21,000 | $ 0 |
ORGANIZATION AND OPERATIONS
ORGANIZATION AND OPERATIONS | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND OPERATIONS | ORGANIZATION AND OPERATIONS CIM Commercial Trust Corporation ("CIM Commercial" or the "Company"), a Maryland corporation and real estate investment trust ("REIT"), or together with its wholly-owned subsidiaries ("we," "us" or "our") primarily invests in, owns, and operates Class A and creative office investments in vibrant and improving urban communities throughout the United States. These communities are located in areas that include traditional downtown areas and suburban main streets, which have high barriers to entry, high population density, improving demographic trends and a propensity for growth. We were originally organized in 1993 as PMC Commercial Trust ("PMC Commercial"), a Texas real estate investment trust. On July 8, 2013 , PMC Commercial entered into a merger agreement (the "Merger Agreement") with CIM Urban REIT, LLC ("CIM REIT"), an affiliate of CIM Group, L.P. ("CIM Group" or "CIM"), and subsidiaries of the respective parties. CIM REIT was a private commercial REIT and was the owner of CIM Urban Partners, L.P. ("CIM Urban"). The transaction (the "Merger") was completed on March 11, 2014 (the "Acquisition Date"). As a result of the Merger and related transactions, CIM Urban became our wholly-owned subsidiary. Our common stock, $0.001 par value per share ("Common Stock"), is currently traded on the NASDAQ Global Market under the ticker symbol "CMCT." We have authorized for issuance 900,000,000 shares of Common Stock and 100,000,000 shares of preferred stock. CIM Commercial has qualified and intends to continue to qualify as a REIT, as defined in the Internal Revenue Code of 1986, as amended. |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2017 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES For more information regarding our significant accounting policies and estimates, please refer to "Basis of Presentation and Summary of Significant Accounting Policies" contained in Note 3 to our consolidated financial statements for the year ended December 31, 2016 , included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 16, 2017 . Interim Financial Information —The accompanying interim consolidated financial statements of CIM Commercial have been prepared by our management in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim consolidated financial statements do not include all of the information and notes required by GAAP for complete financial statements. The accompanying financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods. Operating results for the three and six months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017 . Our accompanying interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K filed with the SEC on March 16, 2017 . Principles of Consolidation —The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Investments in Real Estate —Real estate acquisitions are recorded at cost as of the acquisition date. Costs related to the acquisition of properties are expensed as incurred. Investments in real estate are stated at depreciated cost. Depreciation and amortization are recorded on a straight line basis over the estimated useful lives as follows: Buildings and improvements 15 - 40 years Furniture, fixtures, and equipment 3 - 5 years Tenant improvements Shorter of the useful lives or the Improvements and replacements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. Ordinary repairs and maintenance are expensed as incurred. Investments in real estate are evaluated for impairment on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. The estimated fair value of the asset group identified for step two of the impairment testing under GAAP is based on either the income approach with market discount rate, terminal capitalization rate and rental rate assumptions being most critical, or on the sales comparison approach to similar properties. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell. We recognized impairment of long-lived assets of $13,100,000 and $0 during the three months ended June 30, 2017 and 2016 , respectively, and $13,100,000 and $0 during the six months ended June 30, 2017 and 2016 , respectively (Note 3). Derivative Financial Instruments —As part of our risk management and operational strategies, from time to time, we may enter into derivative contracts with various counterparties. All derivatives are recognized on the balance sheet at their estimated fair value. On the date that we enter into a derivative contract, we designate the derivative as a fair value hedge, a cash flow hedge, a foreign currency fair value or cash flow hedge, a hedge of a net investment in a foreign operation, or a trading or non-hedging instrument. Changes in the estimated fair value of a derivative that is highly effective and that is designated and qualifies as a cash flow hedge, to the extent that the hedge is effective, are initially recorded in other comprehensive income ("OCI"), and are subsequently reclassified into earnings as a component of interest expense when the variability of cash flows of the hedged transaction affects earnings (e.g., when periodic settlements of a variable-rate asset or liability are recorded in earnings). Any hedge ineffectiveness (which represents the amount by which the changes in the estimated fair value of the derivative differ from the variability in the cash flows of the forecasted transaction) is recognized in current-period earnings as a component of interest expense. When an interest rate swap designated as a cash flow hedge no longer qualifies for hedge accounting, we recognize changes in estimated fair value of the hedge previously deferred to accumulated other comprehensive income ("AOCI"), along with any changes in estimated fair value occurring thereafter, through earnings. We classify cash flows from interest rate swap agreements as net cash provided from operating activities on the consolidated statements of cash flows as our accounting policy is to present the cash flows from the hedging instruments in the same category in the consolidated statements of cash flows as the category for the cash flows from the hedged items. See Note 13 for disclosures about our derivative financial instruments and hedging activities. Loans Receivable —Our loans receivable included in other assets are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves. For loans originated under the Small Business Administration's ("SBA") 7(a) Guaranteed Loan Program ("SBA 7(a) Program"), we sell the portion of the loan that is guaranteed by the SBA. Upon sale of the SBA guaranteed portion of the loans, which are accounted for as sales, the unguaranteed portion of the loan retained by us is valued on a fair value basis and a discount (the "Retained Loan Discount") is recorded as a reduction in basis of the retained portion of the loan. At the Acquisition Date, the carrying value of our loans was adjusted to estimated fair market value and acquisition discounts of $33,907,000 were recorded, which are being accreted to interest and other income using the effective interest method. We sold substantially all of our commercial mortgage loans with unamortized acquisition discounts of $15,951,000 to an unrelated third party in December 2015 (Note 7). Acquisition discounts of $1,563,000 remained as of June 30, 2017 which have not yet been accreted to income. A loan receivable is generally classified as non-accrual (a "Non-Accrual Loan") if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and/or interest is in doubt. Generally, loans are charged-off when management determines that we will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means. Interest income, included in interest and other income or discontinued operations, on a Non-Accrual Loan is recognized on either the cash basis or the cost recovery basis. On a quarterly basis, and more frequently if indicators exist, we evaluate the collectability of our loans receivable. Our evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers' business models and future operations in accordance with Accounting Standards Codification ("ASC") 450-20, Contingencies—Loss Contingencies , and ASC 310-10, Receivables . For the three and six months ended June 30, 2017 , we recorded a net impairment of $0 and $12,000 on our loans receivable, respectively. For the three and six months ended June 30, 2016 , we recorded a net impairment (recovery) of $7,000 and $(236,000) on our loans receivable, respectively. We establish a general loan loss reserve when available information indicates that it is probable a loss has occurred based on the carrying value of the portfolio and the amount of the loss can be reasonably estimated. Significant judgment is required in determining the general loan loss reserve, including estimates of the likelihood of default and the estimated fair value of the collateral. The general loan loss reserve includes those loans, which may have negative characteristics which have not yet become known to us. In addition to the reserves established on loans not considered impaired that have been evaluated under a specific evaluation, we establish the general loan loss reserve using a consistent methodology to determine a loss percentage to be applied to loan balances. These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions. Deferred Rent Receivable and Charges —Deferred rent receivable and charges consist of deferred rent, deferred leasing costs, deferred offering costs (Note 11) and other deferred costs. Deferred rent receivable is $56,406,000 and $64,010,000 at June 30, 2017 and December 31, 2016 , respectively. Deferred leasing costs, which represent lease commissions and other direct costs associated with the acquisition of tenants, are capitalized and amortized on a straight-line basis over the terms of the related leases. Deferred leasing costs of $60,116,000 and $76,063,000 are presented net of accumulated amortization of $25,338,000 and $25,914,000 at June 30, 2017 and December 31, 2016 , respectively. Deferred offering costs represent direct costs incurred in connection with our offering of Units (as defined in Note 11), excluding costs specifically identifiable to a closing, such as commissions, dealer-manager fees, and other registration fees. For a specific issuance of Units, associated offering costs are reclassified as a reduction of proceeds raised on the issuance date. Offering costs incurred but not directly related to a specifically identifiable closing are deferred. Deferred offering costs are first allocated to each issuance on a pro-rata basis equal to the ratio of Units issued in an issuance to the maximum number of Units that are expected to be issued. Then, the deferred offering costs allocated to such issuance are further allocated to the Series A Preferred Stock (as defined in Note 11) and Warrants (as defined in Note 11) issued in such issuance based on the relative fair value of the instruments on the date of issuance. The deferred offering costs allocated to the Series A Preferred Stock and Warrants are reductions to temporary equity and permanent equity, respectively. Deferred offering costs of $2,771,000 and $2,060,000 related to our offering of Units are included in deferred rent receivable and charges at June 30, 2017 and December 31, 2016 , respectively. Other deferred costs are $1,414,000 and $135,000 at June 30, 2017 and December 31, 2016 , respectively. Redeemable Preferred Stock —Beginning on the date of original issuance of any given shares of Series A Preferred Stock (Note 11), the holder of such shares will have the right to require the Company to redeem such shares at a redemption price of 100% of the Stated Value (as defined in Note 11), plus accrued and unpaid dividends, subject to the payment of a redemption fee until the fifth anniversary of such issuance. From and after the fifth anniversary of the date of the original issuance, the holder will have the right to require the Company to redeem such shares at a redemption price of 100% of the Stated Value, plus accrued and unpaid dividends, without a redemption fee, and the Company will have the right (but not the obligation) to redeem such shares at 100% of the Stated Value, plus accrued and unpaid dividends. The applicable redemption price payable upon redemption of any Series A Preferred Stock will be in cash or, on or after the first anniversary of the issuance of such shares of Series A Preferred Stock to be redeemed, in the Company’s sole discretion, in cash or in equal value through the issuance of shares of Common Stock, based on the volume weighted average price of our Common Stock for the 20 trading days prior to the redemption. Since a holder of Series A Preferred Stock has the right to request redemption of such shares and redemptions prior to the first anniversary are to be paid in cash, we have recorded the activity related to our Series A Preferred Stock in temporary equity. We recorded the activity related to our Warrants (Note 11) in permanent equity. On the first anniversary of the date of original issuance of a particular share of Series A Preferred Stock, we intend to reclassify such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date. Proceeds and expenses from the sale of the Units are allocated to the Series A Preferred Stock and Warrants using their relative fair values on the date of issuance. Noncontrolling Interests —Noncontrolling interests represent the interests in various properties owned by third parties. Restricted Cash —Our mortgage loan and hotel management agreements provide for depositing cash into restricted accounts reserved for property taxes, insurance, capital expenditures, free rent, tenant improvement and leasing commission obligations. Restricted cash also includes cash required to be segregated in connection with certain of our loans receivable. Assets Held for Sale and Discontinued Operations —In the ordinary course of business, we may periodically enter into agreements relating to dispositions of investments. Some of these agreements are non-binding because either they do not obligate either party to pursue any transactions until the execution of a definitive agreement or they provide the potential buyer with the ability to terminate without penalty or forfeiture of any material deposit, subject to certain specified contingencies, such as completion of due diligence at the discretion of such buyer. We do not classify assets that are subject to such non-binding agreements as held for sale. We classify assets as held for sale, if material, when they meet the necessary criteria, which include: a) management commits to and actively embarks upon a plan to sell the assets, b) the assets to be sold are available for immediate sale in their present condition, c) the sale is expected to be completed within one year under terms usual and customary for such sales and d) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. We generally believe that we meet these criteria when the plan for sale has been approved by our board of directors (the "Board of Directors"), there are no known significant contingencies related to the sale and management believes it is probable that the sale will be completed within one year. Assets held for sale are recorded at the lower of cost or estimated fair value less cost to sell. In addition, if we were to determine that the asset disposal associated with assets held for sale or disposed of represents a strategic shift, the revenues, expenses and net gain (loss) on dispositions would be recorded in discontinued operations for all periods presented through the date of the applicable disposition. We have assessed the sale of three of our multifamily properties and our agreements to sell two multifamily properties (Note 3) in accordance with ASC 205-20, Discontinued Operations . In our assessment, we considered, among other factors, the materiality of the revenue, net operating income, and total assets of our multifamily segment during the three and six months ended June 30, 2017 and for the years ended December 31, 2016 and 2015. Based on our qualitative and quantitative assessment, we concluded the disposals do not represent a strategic shift that will have a major effect on our operations and financial results and they should not be classified as discontinued operations in our consolidated financial statements. Consolidation Considerations for Our Investments in Real Estate —ASC 810-10, Consolidation , addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights that would require the entity to be consolidated. We analyze our investments in real estate in accordance with this accounting standard to determine whether they are variable interest entities, and if so, whether we are the primary beneficiary. Our judgment with respect to our level of influence or control over an entity and whether we are the primary beneficiary of a variable interest entity involves consideration of various factors, including the form of our ownership interest, our voting interest, the size of our investment (including loans), and our ability to participate in major policy-making decisions. Our ability to correctly assess our influence or control over an entity affects the presentation of these investments in our consolidated financial statements. Use of Estimates —The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Reclassifications —Certain prior period amounts have been reclassified to conform with the current period presentation. These reclassifications had no effect on previously reported net income or cash flows. Recently Issued Accounting Pronouncements— In January 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities , which is designed to improve the recognition and measurement of financial instruments through targeted changes to existing GAAP. The ASU requires an entity to: (i) measure equity investments at fair value through net income, with certain exceptions; (ii) present in OCI the changes in instrument-specific credit risk for financial liabilities measured using the fair value option; (iii) present financial assets and financial liabilities by measurement category and form of financial asset; (iv) calculate the fair value of financial instruments for disclosure purposes based on an exit price; and (v) assess a valuation allowance on deferred tax assets related to unrealized losses of available-for-sale debt securities in combination with other deferred tax assets. In addition, the ASU provides an election to subsequently measure certain nonmarketable equity investments at cost less any impairment and adjusted for certain observable price changes. The ASU also requires a qualitative impairment assessment of such equity investments and amends certain fair value disclosure requirements. For public business entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption by public entities to financial statements that have not yet been issued is permitted only for the provision related to instrument-specific credit risk. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which is intended to improve financial reporting about leasing transactions. Under the new guidance, a lessee will be required to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP, which requires a lessee to recognize only capital leases on the balance sheet, the new ASU will require a lessee to recognize both types of leases on the balance sheet. The lessor accounting will remain largely unchanged from current GAAP. However, the ASU contains some targeted improvements that are intended to align, where necessary, lessor accounting with the lessee accounting model and with the updated revenue recognition guidance issued in 2014. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2018. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , which is intended to simplify several aspects of the accounting for share-based payment transactions, including accounting for income taxes, classification of excess tax benefits on the statement of cash flows, forfeitures, minimum statutory tax withholding requirements, and classification of employee taxes paid on the statement of cash flows when an employer withholds shares for tax-withholding purposes. In addition, the ASU eliminates certain guidance in ASC 718, which was indefinitely deferred shortly after the issuance of FASB Statement No. 123 (revised 2004), Share-Based Payment . For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. Early adoption is permitted and an entity that elects early adoption must adopt all of the amendments in the same period. The adoption of this guidance did not have a material impact on our consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity. The amendments in the ASU replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2019. Early adoption is permitted for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2018. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which provides guidance on how certain cash receipts and cash payments are to be presented and classified in the statement of cash flows. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash , which requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this update do not provide a definition of restricted cash or restricted cash equivalents. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers , which make certain technical corrections and improvements to ASU 2014-09. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations: Clarifying the Definition of a Business , which narrows the definition of a business and provides a framework that gives entities a basis for making reasonable judgments about whether a transaction involves an asset or a business. For public entities, the ASU is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017. Early adoption is permitted under certain circumstances as outlined in the ASU. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 6 Months Ended |
Jun. 30, 2017 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND DISPOSITIONS | ACQUISITIONS AND DISPOSITIONS The fair value of real estate acquired is recorded to the acquired tangible assets, consisting primarily of land, land improvements, building and improvements, tenant improvements, and furniture, fixtures, and equipment, and identified intangible assets and liabilities, consisting of the value of acquired above-market and below-market leases, in-place leases and ground leases, if any, based in each case on their respective fair values. Loan premiums, in the case of above-market rate loans, or loan discounts, in the case of below-market rate loans, are recorded based on the fair value of any loans assumed in connection with acquiring the real estate. There were no acquisitions during the six months ended June 30, 2017 . On March 28, 2017 , we sold a 100% fee-simple interest in 211 Main Street located in San Francisco, California to an unrelated third party. Transaction costs expensed in connection with this sale totaled $2,943,000 and included a prepayment penalty of $1,508,000 incurred in connection with the prepayment of the property's mortgage (Note 8). On May 30, 2017 , we sold a 100% fee-simple interest in 3636 McKinney Avenue and 3839 McKinney Avenue, both located in Dallas, Texas, to an unrelated third party. Transaction costs expensed in connection with these sales totaled $2,258,000 and included prepayment penalties of $1,901,000 incurred in connection with the prepayment of the properties' mortgages (Note 8). On June 8, 2017 , we sold a 100% fee-simple interest in 200 S College Street located in Charlotte, North Carolina to an unrelated third party. Transaction costs expensed in connection with this sale totaled $833,000 . On June 20, 2017 , we sold a 100% fee-simple interest in 980 9th Street and 1010 8th Street, both located in Sacramento, California, to an unrelated third party. Transaction costs expensed in connection with these sales totaled $952,000 . On June 23, 2017 , we sold a 100% fee-simple interest in 4649 Cole Avenue located in Dallas, Texas to an unrelated third party. Transaction costs expensed in connection with this sale totaled $3,311,000 and included a prepayment penalty of $2,812,000 incurred in connection with the prepayment of the property's mortgage (Note 8). The results of operations of the aforementioned properties have been included in the consolidated statements of operations through their respective disposition dates. Property Asset Type Date of Sale Square Feet / Units Sales Price Gain on Sale (in thousands) 211 Main Street, San Francisco, CA Office March 28, 2017 417,266 $ 292,882 $ 187,734 3636 McKinney Avenue, Dallas, TX Multifamily May 30, 2017 103 $ 20,000 $ 5,488 3839 McKinney Avenue, Dallas, TX Multifamily May 30, 2017 75 $ 14,100 $ 4,224 200 S College Street, Charlotte, NC Office June 8, 2017 567,865 $ 148,500 $ 45,906 980 9th Street and 1010 8th Street, Sacramento, CA Office & Parking Garage June 20, 2017 485,926 $ 120,500 $ 34,829 4649 Cole Avenue, Dallas, TX Multifamily June 23, 2017 334 $ 64,000 $ 25,836 The following is the detail of the carrying amount of assets and liabilities at the time of the sales of the properties in 2017: (in thousands) Assets Investments in real estate, net $ 319,078 Deferred rent receivable and charges, net 22,089 Other intangible assets, net 129 Other assets 38 Total assets $ 341,334 Liabilities Debt, net (1) $ 64,777 Intangible liabilities, net 1,800 Total liabilities $ 66,577 _______________________________________________________________________________ (1) Net of $665,000 of premium on assumed mortgage. There were no acquisitions during the six months ended June 30, 2016 . On February 2, 2016 , we sold a 100% fee-simple interest in the Courtyard Oakland located in Oakland, California to an unrelated third party. The results of operations of this hotel have been included in the consolidated statement of operations through the date of disposition. Property Asset Date of Sale Rooms Sales Gain on (in thousands) Courtyard Oakland, Oakland, CA Hotel February 2, 2016 162 $ 43,800 $ 24,739 We have entered into three purchase and sale agreements, each as a separate transaction with unrelated third parties, for the sale of an office property located at 7083 Hollywood Boulevard in Los Angeles, California; a multifamily property located at 4200 Scotland Street in Houston, Texas; and a multifamily property located at 47 E 34th Street in New York, New York. The aggregate contract sales price for these properties is $186,325,000 . In connection with these dispositions, $50,568,000 of the outstanding mortgages payable at June 30, 2017 will be repaid or assumed by the buyer. We expect the closing of these sales transactions to occur during the second half of 2017. These purchase and sale agreements were entered into and became subject to non-refundable deposits on or prior to June 30, 2017 . Therefore, these properties have been classified as held for sale as of June 30, 2017 . The following is the detail of the carrying amounts of assets and liabilities of the properties that are classified as held for sale on our consolidated balance sheet as of June 30, 2017 : (in thousands) Assets Investments in real estate, net (1) $ 118,221 Cash and cash equivalents 2,904 Restricted cash 51 Accounts receivable, net 251 Deferred rent receivable and charges, net 1,865 Other intangible assets, net (2) 1,124 Other assets 722 Total assets held for sale, net $ 125,138 Liabilities Debt, net (3) $ 50,230 Accounts payable and accrued expenses 1,402 Due to related parties 195 Other liabilities 1,059 Total liabilities associated with assets held for sale, net $ 52,886 _______________________________________________________________________________ (1) Investments in real estate of $136,153,000 are presented net of accumulated depreciation of $17,932,000 . (2) Other intangible assets, net, represents a tax abatement asset of $4,273,000 associated with 47 E 34th Street, which is presented net of accumulated amortization of $3,149,000 . (3) Debt includes the outstanding principal balances of 7083 Hollywood Boulevard and 4200 Scotland Street, which are $21,700,000 and $28,868,000 , respectively. Debt is presented net of deferred loan costs of $524,000 and the accumulated amortization of $186,000 . In August 2017, we negotiated an agreement with an unrelated third party for the sale of an office property. We expect the sale to close during the second half of 2017 . The purchase and sale agreement has not yet been finalized and is not subject to a non-refundable deposit. Therefore, the property has not been classified as held for sale as of June 30, 2017 as not all the held for sale criteria had been met at such time. We determined the book value of this property exceeded its estimated fair value less costs to sell, and as such, an impairment charge of $13,100,000 was recognized as of June 30, 2017 . Our determination of fair value was based on negotiations with the third party buyer. |
INVESTMENTS IN REAL ESTATE
INVESTMENTS IN REAL ESTATE | 6 Months Ended |
Jun. 30, 2017 | |
Real Estate [Abstract] | |
INVESTMENTS IN REAL ESTATE | INVESTMENTS IN REAL ESTATE Investments in real estate consist of the following: June 30, 2017 December 31, 2016 (in thousands) Land $ 244,072 $ 343,564 Land improvements 17,746 26,177 Buildings and improvements 1,064,191 1,475,415 Furniture, fixtures, and equipment 3,525 4,955 Tenant improvements 130,481 159,677 Work in progress 9,528 11,706 Investments in real estate 1,469,543 2,021,494 Accumulated depreciation (328,083 ) (414,552 ) Net investments in real estate $ 1,141,460 $ 1,606,942 We recorded depreciation expense of $12,670,000 and $16,030,000 for the three months ended June 30, 2017 and 2016 , respectively, and $27,354,000 and $31,703,000 for the six months ended June 30, 2017 and 2016 , respectively. |
OTHER INTANGIBLE ASSETS
OTHER INTANGIBLE ASSETS | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
OTHER INTANGIBLE ASSETS | OTHER INTANGIBLE ASSETS A schedule of our intangible assets and liabilities and related accumulated amortization and accretion as of June 30, 2017 and December 31, 2016 is as follows: Assets Liabilities June 30, 2017 Acquired Acquired Trade Name and License Acquired (in thousands) Gross balance $ 10,181 $ 11,685 $ 2,957 $ (5,722 ) Accumulated amortization (7,581 ) (1,632 ) — 4,584 $ 2,600 $ 10,053 $ 2,957 $ (1,138 ) Average useful life (in years) 10 84 Indefinite 7 Assets Liabilities December 31, 2016 Acquired Acquired Tax Acquired Trade Name and License Acquired (in thousands) Gross balance $ 215 $ 11,551 $ 4,273 $ 11,685 $ 2,957 $ (18,893 ) Accumulated amortization (180 ) (8,443 ) (2,873 ) (1,562 ) — 15,317 $ 35 $ 3,108 $ 1,400 $ 10,123 $ 2,957 $ (3,576 ) Average useful life (in years) 8 10 8 84 Indefinite 8 _______________________________________________________________________________ (1) Tax abatement is associated with 47 E 34th Street, which is classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). The amortization of the acquired above-market leases which decreased rental and other property income was $0 and $26,000 for the three months ended June 30, 2017 and 2016 , respectively, and $3,000 and $64,000 for the six months ended June 30, 2017 and 2016 , respectively. The amortization of the acquired in-place leases included in depreciation and amortization expense was $195,000 and $368,000 for the three months ended June 30, 2017 and 2016 , respectively, and $411,000 and $748,000 for the six months ended June 30, 2017 and 2016 , respectively. Included in depreciation and amortization expense was franchise affiliation fee amortization of $0 and $0 for the three months ended June 30, 2017 and 2016 , respectively, and $0 and $33,000 for the six months ended June 30, 2017 and 2016 , respectively. Tax abatement amortization of $138,000 for each of the three months ended June 30, 2017 and 2016 , and $276,000 for each of the six months ended June 30, 2017 and 2016 was included in rental and other property operating expenses. The amortization of the acquired below-market ground lease of $35,000 for each of the three months ended June 30, 2017 and 2016 , and $70,000 for each of the six months ended June 30, 2017 and 2016 was included in rental and other property operating expenses. The amortization of the acquired below-market leases included in rental and other property income was $219,000 and $631,000 for the three months ended June 30, 2017 and 2016 , respectively, and $638,000 and $1,262,000 for the six months ended June 30, 2017 and 2016 , respectively. A schedule of future amortization and accretion of acquisition related intangible assets and liabilities as of June 30, 2017 , is as follows: Assets Liabilities Years Ending December 31, Acquired Acquired Acquired (in thousands) 2017 (Six months ending December 31, 2017) $ 373 $ 70 $ (428 ) 2018 723 140 (510 ) 2019 464 140 (200 ) 2020 207 140 — 2021 207 140 — Thereafter 626 9,423 — $ 2,600 $ 10,053 $ (1,138 ) |
OTHER ASSETS
OTHER ASSETS | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
OTHER ASSETS | OTHER ASSETS Other assets consist of the following: June 30, 2017 December 31, 2016 (in thousands) SBA 7(a) loans, subject to credit risk $ 46,276 $ 43,623 SBA 7(a) loans, subject to secured borrowings 24,162 29,524 Other assets 18,717 19,123 $ 89,155 $ 92,270 SBA 7(a) Loans, Subject to Credit Risk —Represents the non‑government guaranteed retained portion of loans originated under the SBA 7(a) Program and the government guaranteed portion of loans that have not yet been fully funded or sold. SBA 7(a) Loans, Subject to Secured Borrowings —Represents the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans. There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal. At June 30, 2017 and December 31, 2016 , 99.5% and 99.7% , respectively, of our loans subject to credit risk were current with the remainder ( $236,000 and $249,000 , respectively) greater than 29 days delinquent. We classify loans with negative characteristics in substandard categories ranging from special mention to doubtful. At June 30, 2017 and December 31, 2016 , $593,000 and $804,000 , respectively, of loans subject to credit risk were classified in substandard categories. At June 30, 2017 and December 31, 2016 , our loans subject to credit risk were 95.9% and 94.6% , respectively, concentrated in the hospitality industry. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Jun. 30, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS We had reflected the lending segment, which was acquired on the Acquisition Date as disclosed in Note 1, as held for sale commencing in 2014, based on a plan approved by the Board of Directors to sell the lending segment that, when completed, would have resulted in the deconsolidation of the lending segment, which at that time was focused on small business lending in the hospitality industry. In July 2015, to maximize value, we modified our strategy from a strategy of selling the lending segment as a whole to a strategy of soliciting buyers for components of the business, including our commercial mortgage loans and the SBA 7(a) lending platform. This change in the sale methodology resulted in the need to extend the period to complete the sale of the lending segment beyond one year. In connection with our plan, we expensed transaction costs of $11,000 and $20,000 as incurred during the three and six months ended June 30, 2016 , respectively. On December 17, 2015, pursuant to the modified plan, we sold substantially all of our commercial mortgage loans with a carrying value of $77,121,000 to an unrelated third party and recognized a gain of $5,151,000 . In September 2016, we discontinued our efforts to sell the SBA 7(a) lending platform, and the activities related to the SBA 7(a) lending platform have been reclassified to continuing operations for all periods presented. On December 29, 2016, we sold our commercial real estate lending subsidiary, which was classified as held for sale and had a carrying value of $27,587,000 , which was equal to management's estimate of fair value, to a fund managed by an affiliate of CIM Group. We did not recognize any gain or loss in connection with the transaction. Management's estimate of fair value was determined with assistance from an independent third party valuation firm. The following is the detail of income from operations of assets held for sale classified as discontinued operations on the consolidated statements of operations for the three and six months ended June 30, 2016 : Three Months Ended June 30, 2016 Six Months Ended June 30, 2016 (in thousands) Revenue —Interest and other income $ 2,416 $ 3,531 Expenses: Interest expense 588 876 Fees to related party 148 280 General and administrative 12 17 Total expenses 748 1,173 Income from operations of assets held for sale $ 1,668 $ 2,358 During the three months ended June 30, 2017 , we sold three of our five multifamily properties to unrelated third parties and we entered into purchase and sale agreements subject to non-refundable deposits, each as a separate transaction with unrelated third parties, for the remaining two multifamily properties, which have been classified as held for sale on our consolidated balance sheet as of June 30, 2017 . We expect the closing of these sales to occur during the second half of 2017. We have assessed the sale of three of our multifamily properties and our agreements to sell two multifamily properties (Note 3) in accordance with ASC 205-20, Discontinued Operations . In our assessment, we considered, among other factors, the materiality of the revenue, net operating income, and total assets of our multifamily segment during the three and six months ended June 30, 2017 and for the years ended December 31, 2016 and 2015. Based on our qualitative and quantitative assessment, we concluded the disposals do not represent a strategic shift that will have a major effect on our operations and financial results and they should not be classified as discontinued operations in our consolidated financial statements. |
DEBT
DEBT | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Information on our debt is as follows: June 30, 2017 December 31, 2016 (in thousands) Mortgage loans with a fixed interest rate of 4.14% per annum, with monthly payments of interest only, and balances totaling $370,300,000 due on July 1, 2026. The loans are nonrecourse. One loan with an outstanding principal balance of $21,700,000 was reclassified to liabilities associated with assets held for sale at June 30, 2017 (Note 3). $ 370,300 $ 392,000 Mortgage loan with a fixed interest rate of 4.50% per annum, with monthly payments of interest only for 10 years, and payments of interest and principal starting in February 2022. The loan has a $42,008,000 balance due on January 5, 2027. The loan is nonrecourse. 46,000 46,000 Mortgage loans with a fixed interest rate of 5.39% per annum, with monthly payments of principal and interest, and balances totaling $35,695,000 due on March 1, 2021. The loans were nonrecourse. The loans were repaid in May and June 2017 in connection with the sale of the properties that were collateral for the loans. — 39,134 Mortgage loan with a fixed interest rate of 5.18% per annum, with monthly payments of principal and interest, and a balance of $26,232,000 due on June 5, 2021. The loan is nonrecourse. The loan was reclassified to liabilities associated with assets held for sale at June 30, 2017 (Note 3). — 29,167 Mortgage loan with a fixed interest rate of 6.65% per annum, with monthly payments of principal and interest. The loan had a 25-year amortization schedule with a $21,136,000 balance due on July 15, 2018. The loan was nonrecourse. The loan was repaid in March 2017 in connection with the sale of the property that was collateral for the loan. — 26,136 416,300 532,437 Deferred loan costs related to mortgage loans (1,628 ) (2,366 ) Premiums and discounts on assumed mortgages, net — 722 Total Mortgages Payable 414,672 530,793 Secured borrowing principal on SBA 7(a) loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 4.55% and 4.13% at June 30, 2017 and December 31, 2016, respectively. 18,504 23,122 Secured borrowing principal on SBA 7(a) loans sold for excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 2.33% and 1.83% at June 30, 2017 and December 31, 2016, respectively. 4,460 4,777 22,964 27,899 Unamortized premiums 1,638 2,077 Total Secured Borrowings—Government Guaranteed Loans 24,602 29,976 Unsecured term loan facility 385,000 385,000 Junior subordinated notes with a variable interest rate which resets quarterly based on the 90-day LIBOR plus 3.25%, with quarterly interest only payments. Balance due at maturity on March 30, 2035. 27,070 27,070 Unsecured credit facility — — 412,070 412,070 Deferred loan costs related to unsecured term loan and credit facilities (2,534 ) (2,938 ) Discount on junior subordinated notes (1,977 ) (2,015 ) Total Other 407,559 407,117 Total Debt $ 846,833 $ 967,886 The mortgages payable are secured by deeds of trust on certain of the properties and assignments of rents. The junior subordinated notes may be redeemed at par at our option. Secured borrowings—government guaranteed loans represent sold loans which are treated as secured borrowings because the loan sales did not meet the derecognition criteria provided for in ASC 860-30, Secured Borrowing and Collateral . These loans included cash premiums that are amortized as a reduction to interest expense over the life of the loan using the effective interest method and are fully amortized when the underlying loan is repaid in full. Deferred loan costs, which represent legal and third-party fees incurred in connection with our borrowing activities, are capitalized and amortized to interest expense on a straight-line basis over the life of the related loan, approximating the effective interest method. Deferred loan costs of $5,835,000 and $7,122,000 are presented net of accumulated amortization of $1,673,000 and $1,818,000 at June 30, 2017 and December 31, 2016 , respectively, and are a reduction to total debt. In September 2014, CIM Commercial entered into an $850,000,000 unsecured credit facility with a bank syndicate consisting of a $450,000,000 revolver, a $325,000,000 term loan and a $75,000,000 delayed-draw term loan. CIM Commercial is subject to certain financial maintenance covenants and a minimum property ownership condition. Outstanding advances under the revolver bear interest at (i) the base rate plus 0.20% to 1.00% or (ii) LIBOR plus 1.20% to 2.00% , depending on the maximum consolidated leverage ratio. Outstanding advances under the term loans bore interest at (i) the base rate plus 0.15% to 0.95% or (ii) LIBOR plus 1.15% to 1.95% , depending on the maximum consolidated leverage ratio. The revolver is also subject to an unused commitment fee of 0.15% or 0.25% depending on the amount of aggregate unused commitments. The delayed-draw term loan was also subject to an unused line fee of 0.25% . Proceeds from the unsecured credit facility were used to repay mortgage loans and outstanding balances under our prior unsecured credit facilities, for acquisitions, short-term funding of a Common Stock tender offer in June 2016, short-term funding of a private repurchase of Common Stock in June 2017, and general corporate purposes. In June 2016, we entered into six mortgage loan agreements with an aggregate principal amount of $392,000,000 . A portion of the net proceeds from the loans was used to repay outstanding balances under our unsecured credit facility and the remaining portion was used to repurchase shares of our Common Stock in a private repurchase in September 2016. The June 2017 borrowing used to fund the private share repurchase was repaid using proceeds from subsequent asset sales. The credit facility was set to mature in September 2016 and prior to maturity, we exercised the first of two one year extension options through September 2017 and we permanently reduced the revolving credit commitment under the credit facility to $200,000,000 . In August 2017, we exercised the second of two one year extension options through September 2018 and, in connection with such exercise, we will pay an extension fee of $300,000 . At June 30, 2017 and December 31, 2016 , $0 was outstanding under the credit facility. The unused capacity on the unsecured credit facility, based on covenant restrictions at June 30, 2017 and December 31, 2016 , was approximately $89,000,000 and $200,000,000 , respectively. In May 2015, CIM Commercial entered into an unsecured term loan facility with a bank syndicate pursuant to which CIM Commercial can borrow up to a maximum of $385,000,000 . The term loan facility ranks pari passu with CIM Commercial's unsecured credit facility described above; covenants under the term loan facility are substantially the same as those in the unsecured credit facility. Outstanding advances under the term loan facility bear interest at (i) the base rate plus 0.60% to 1.25% or (ii) LIBOR plus 1.60% to 2.25% , depending on the maximum consolidated leverage ratio. The unused portion of the term loan facility was also subject to an unused fee of 0.20% . With some exceptions, any prepayment of the term loan facility prior to May 9, 2017 was subject to a prepayment fee up to 2.00% of the outstanding principal amount. The term loan facility matures in May 2022. On November 2, 2015, $385,000,000 was drawn under the term loan facility. At June 30, 2017 and December 31, 2016 , $385,000,000 was outstanding under the term loan facility. Proceeds from the term loan facility were used to repay balances outstanding under our unsecured credit facility. At June 30, 2017 and December 31, 2016 , the variable interest rate on this unsecured term loan facility was 2.65% and 2.22% , respectively. The interest rate of the loan has been effectively converted to a fixed rate of 3.16% until May 8, 2020 through interest rate swaps (Note 13). On August 3, 2017 , we repaid $65,000,000 of outstanding borrowings on our unsecured term loan facility. In connection with such pay down, we terminated three interest rate swaps with an aggregate notional value of $65,000,000 (Note 13). Costs incurred to terminate such swaps totaled $38,000 , which will be reflected in earnings. At June 30, 2017 and December 31, 2016 , we were in compliance with all of our respective financial covenants under the unsecured credit and term loan facilities. On March 28, 2017 , in connection with the sale of an office property in San Francisco, California, we paid off a mortgage with an outstanding balance of $25,331,000 using proceeds from the sale. Additionally, we paid a prepayment penalty of $1,508,000 in connection with the prepayment of this mortgage (Note 3). On May 30, 2017 , in connection with the sale of two multifamily properties, both located in Dallas, Texas, we paid off two mortgages with an aggregate outstanding balance of $15,448,000 using proceeds from the sales. Additionally, we paid aggregate prepayment penalties of $1,901,000 in connection with the prepayment of these mortgages (Note 3). On June 23, 2017 , in connection with the sale of a multifamily property in Dallas, Texas, we paid off a mortgage with an outstanding balance of $23,333,000 using proceeds from the sale. Additionally, we paid a prepayment penalty of $2,812,000 in connection with the prepayment of this mortgage (Note 3). As of June 30, 2017 , two mortgage loans are included in liabilities associated with assets held for sale on our consolidated balance sheet. The first mortgage loan is nonrecourse, is secured by an office property located at 7083 Hollywood Boulevard in Los Angeles, California, and has a balance of $21,700,000 at June 30, 2017 with a fixed interest rate of 4.14% per annum, requiring monthly payments of interest only, with a maturity date of July 1, 2026. The second mortgage loan is nonrecourse, is secured by a multifamily property located at 4200 Scotland Street in Houston, Texas, and has a balance of $28,868,000 at June 30, 2017 with a fixed interest rate of 5.18% per annum, requiring monthly payments of principal and interest, with a maturity date of June 5, 2021 (Note 3). At June 30, 2017 and December 31, 2016 , accrued interest and unused commitment fees payable of $2,765,000 and $3,133,000 , respectively, are included in accounts payable and accrued expenses. Future principal payments on our debt (face value) at June 30, 2017 are as follows: Years Ending December 31, Secured Borrowings Principal (1) Mortgages Other (3) Total (in thousands) 2017 (Six months ending December 31, 2017) $ 605 $ — $ — $ 605 2018 835 — — 835 2019 867 — — 867 2020 902 — — 902 2021 940 — — 940 Thereafter 18,815 416,300 412,070 847,185 $ 22,964 $ 416,300 $ 412,070 $ 851,334 _______________________________________________________________________________ (1) Principal payments are generally dependent upon cash flows received from the underlying loans. Our estimate of their repayment is based on scheduled principal payments on the underlying loans. Our estimate will differ from actual amounts to the extent we experience prepayments and/or loan liquidations or charge-offs. No payment is due unless payments are received from the borrowers on the underlying loans. (2) Excludes the future principal payments for 7083 Hollywood Boulevard and 4200 Scotland Street, which are classified as liabilities associated with assets held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). (3) Represents the junior subordinated notes and unsecured term loan facility. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION PLANS | STOCK-BASED COMPENSATION PLANS In April 2015, we granted awards of 2,000 restricted shares of Common Stock to each of the independent members of the Board of Directors ( 6,000 in aggregate) under the 2015 Equity Incentive Plan, which fully vested in April 2016 based on one year of continuous service. In May 2016, we granted awards of 3,392 restricted shares of Common Stock to each of the independent members of the Board of Directors ( 10,176 in aggregate) under the 2015 Equity Incentive Plan, which fully vested in May 2017 based on one year of continuous service. In addition, in June 2017, we granted awards of 3,195 restricted shares of Common Stock to each of the independent members of the Board of Directors ( 9,585 in aggregate) under the 2015 Equity Incentive Plan, which will vest over one year of continuous service. Compensation expense related to these restricted shares of Common Stock is recognized over the vesting period. We recorded compensation expense of $29,000 and $32,000 for the three months ended June 30, 2017 and 2016 , respectively, and $77,000 and $59,000 for the six months ended June 30, 2017 and 2016 , respectively, related to these restricted shares of Common Stock. We issued to two of our executive officers an aggregate of 2,000 restricted shares of Common Stock on May 6, 2014, which were fully vested in May 2016, and an aggregate of 2,000 restricted shares of Common Stock on March 6, 2015, which were fully vested in March 2017. The restricted shares of Common Stock vested based on two years of continuous service with one-third of the shares of Common Stock vesting immediately upon issuance and one-third vesting at the end of each of the next two years from the date of issuance. Compensation expense related to these restricted shares of Common Stock was recognized over the vesting period. We recognized compensation expense of $0 and $1,000 for the three months ended June 30, 2017 and 2016 , respectively, and $1,000 and $6,000 for the six months ended June 30, 2017 and 2016 , respectively, related to these restricted shares of Common Stock. As of June 30, 2017 , there was $137,000 of total unrecognized compensation expense related to shares of Common Stock which will be recognized over the next year. |
EARNINGS PER SHARE (''EPS'')
EARNINGS PER SHARE (''EPS'') | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE ("EPS") | EARNINGS PER SHARE ("EPS") The computations of basic EPS are based on our weighted average shares outstanding. The basic weighted average shares of Common Stock outstanding were 78,871,000 and 96,683,000 for the three months ended June 30, 2017 and 2016 , respectively, and 81,445,000 and 97,173,000 for the six months ended June 30, 2017 and 2016 , respectively. We had no dilutive securities outstanding for each of the three and six months ended June 30, 2017 and 2016 . Outstanding shares of Series A Preferred Stock and Warrants were not included in the computation of diluted EPS for the three and six months ended June 30, 2017 because their impact was deemed to be anti-dilutive. No shares of Series A Preferred Stock or Warrants were outstanding during the three and six months ended June 30, 2016 . EPS for the year-to-date period may differ from the sum of quarterly EPS amounts due to the required method for computing EPS in the respective periods. In addition, EPS is calculated independently for each component and may not be additive due to rounding. The following table reconciles the numerator and denominator used in computing our basic and diluted per-share computations for net income available to common stockholders for the three and six months ended June 30, 2017 and 2016 : Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands, except per share amounts) Numerator: Net income (loss) from continuing operations $ 91,372 $ (810 ) $ 285,307 $ 25,483 Net income attributable to noncontrolling interests (9 ) (9 ) (14 ) (12 ) Redeemable preferred stock dividends (72 ) — (103 ) — Numerator for basic and diluted net income (loss) from continuing operations available to common stockholders 91,291 (819 ) 285,190 25,471 Net income from discontinued operations — 1,668 — 2,358 Numerator for basic and diluted net income available to common stockholders $ 91,291 $ 849 $ 285,190 $ 27,829 Denominator: Basic weighted average shares outstanding 78,871 96,683 81,445 97,173 Effect of dilutive securities—contingently issuable shares and stock options — — — — Diluted weighted average shares and common stock equivalents outstanding 78,871 96,683 81,445 97,173 Basic and diluted net income (loss) available to common stockholders per share: Continuing operations $ 1.16 $ (0.01 ) $ 3.50 $ 0.26 Discontinued operations $ — $ 0.02 $ — $ 0.02 Net income $ 1.16 $ 0.01 $ 3.50 $ 0.29 |
REDEEMABLE PREFERRED STOCK
REDEEMABLE PREFERRED STOCK | 6 Months Ended |
Jun. 30, 2017 | |
Series A Preferred Stock | |
Temporary Equity [Line Items] | |
REDEEMABLE PREFERRED STOCK | REDEEMABLE PREFERRED STOCK We have an effective registration statement with the Securities and Exchange Commission (“SEC”) with respect to the offer and sale of up to $900,000,000 of units (collectively, the "Units"), with each unit consisting of (i) one share of Series A Preferred Stock, par value $0.001 per share, of the Company (collectively, the "Series A Preferred Stock") with an initial stated value of $25.00 per share ("Stated Value") and (ii) one warrant (collectively, the "Warrants") to purchase 0.25 of a share of Common Stock (Note 12). The registration statement allows us to sell up to a maximum of 36,000,000 Units. Our Series A Preferred Stock ranks senior to our Common Stock with respect to payment of dividends and distributions of amounts upon liquidation, dissolution or winding up. Proceeds and expenses from the sale of the Units are allocated to the Series A Preferred Stock and Warrants using their relative fair values on the date of issuance. Our Series A Preferred Stock is redeemable at the option of the holder (the "Holder") or CIM Commercial. The redemption schedule of the Series A Preferred Stock allows redemptions at the option of the Holder from the date of original issuance of any given shares of Series A Preferred Stock through the second year at Stated Value, plus accrued and unpaid dividends, subject to the payment of a 13.0% redemption fee. After year two, the redemption fee decreases to 10.0% and after year five there is no redemption fee. Also, CIM Commercial has the right to redeem the Series A Preferred Stock after year five at Stated Value, plus accrued and unpaid dividends. At the Company’s discretion, redemptions will be paid in cash or, on or after the first anniversary of the issuance of such shares of Series A Preferred Stock, an equal value of Common Stock based on the volume weighted average price of our Common Stock for the 20 trading days prior to the redemption. As of June 30, 2017 , no shares of Series A Preferred Stock have been redeemed. As of June 30, 2017 , we had issued 308,775 Units and received gross proceeds of $7,720,000 ( $7,668,000 of which were allocated to the Series A Preferred Stock in temporary equity and the remaining $52,000 were allocated to the Warrants in permanent equity). In connection with such issuance, costs specifically identifiable to the offering of Units, such as commissions, dealer manager fees and other registration fees, totaled $614,000 ( $594,000 of which were allocated to the Series A Preferred Stock in temporary equity and the remaining $20,000 were allocated to the Warrants in permanent equity). In addition, as of June 30, 2017 , non issuance specific costs related to this offering totaled $2,795,000 . As of June 30, 2017 , we have reclassified $24,000 and a de minimis amount from deferred rent receivable and charges to temporary equity and stockholders' equity, respectively, as a reduction to the gross proceeds received. Such reclassification was based on the number of Units issued during the period relative to the maximum number of Units expected to be issued under the offering. Holders of Series A Preferred Stock are entitled to receive, if, as and when authorized by our Board of Directors, and declared by us out of legally available funds, cumulative cash dividends on each share of Series A Preferred Stock at an annual rate of 5.5% of the Stated Value (i.e., the equivalent of $0.34375 per share per quarter). Dividends on each share of Series A Preferred Stock will begin accruing on, and will be cumulative from, the date of issuance. Cash dividends declared on our Series A Preferred Stock for the three and six months ended June 30, 2017 consist of the following: Aggregate Declaration Date Payment Date Number of Shares Dividends Declared (in thousands) June 12, 2017 July 17, 2017 308,775 $ 72 March 8, 2017 April 17, 2017 144,698 $ 31 |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 6 Months Ended |
Jun. 30, 2017 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS' EQUITY Dividends Dividends per share of Common Stock declared during the six months ended June 30, 2017 and 2016 consist of the following: Declaration Date Payment Date Type Dividend Per Common Share June 12, 2017 June 27, 2017 Special Cash $ 1.98000 June 12, 2017 June 27, 2017 Regular Quarterly $ 0.12500 April 5, 2017 April 24, 2017 Special Cash $ 0.28000 March 8, 2017 March 27, 2017 Regular Quarterly $ 0.21875 June 10, 2016 June 28, 2016 Regular Quarterly $ 0.21875 March 8, 2016 March 29, 2016 Regular Quarterly $ 0.21875 On June 12, 2017 , we declared a special cash dividend of $1.98 per share of Common Stock, or $4,271,000 in the aggregate, that was paid on June 27, 2017 to stockholders of record on June 20, 2017 . This special cash dividend allowed common stockholders that did not participate in the June 12, 2017 private repurchase to receive the economic benefit of such repurchase. Urban Partners II, LLC ("Urban II"), a fund managed by an affiliate of CIM Group, the Manager and Advisor of CIM Commercial (each as defined in Note 15), and an affiliate of CIM REIT and CIM Urban, waived its right to receive this special cash dividend. In addition, on April 5, 2017 , we declared a special cash dividend of $0.28 per share of Common Stock, or $601,000 in the aggregate, that was paid on April 24, 2017 to stockholders of record on April 17, 2017 . This special cash dividend allowed common stockholders that did not participate in the September 14, 2016 private repurchase to receive the economic benefit of such repurchase. Urban II waived its right to receive this special cash dividend. Share Repurchases On June 12, 2017 , we repurchased, in a privately negotiated transaction, canceled and retired 26,181,818 shares of Common Stock from Urban II. The aggregate purchase price was $576,000,000 , or $22.00 per share. We funded the repurchase using available cash from asset sales and short-term borrowings on our unsecured credit facility. As a result of the repurchase, our stockholders' equity was reduced by the amount we paid for the repurchased shares and the related expenses. The Company paid a special cash dividend, as described above, on June 27, 2017 that allowed stockholders that did not participate in the June 12, 2017 private repurchase to receive the economic benefit of such repurchase. On September 14, 2016 , we repurchased, in a privately negotiated transaction, canceled and retired 3,628,116 shares of Common Stock from Urban II. The aggregate purchase price was $79,819,000 , or $22.00 per share. We funded the repurchase using proceeds from the six mortgage loans obtained in June 2016. As a result of the repurchase, our stockholders' equity was further reduced by the amount we paid for the repurchased shares and the related expenses. The Company paid a special cash dividend, as described above, on April 24, 2017 that allowed stockholders that did not participate in the September 14, 2016 private repurchase to receive the economic benefit of such repurchase. In addition, on May 16, 2016 , we commenced a cash tender offer to purchase up to 10,000,000 shares of our Common Stock at a price of $21.00 per share. The tender offer expired on June 13, 2016 . The tender offer was oversubscribed and, pursuant to the terms of the tender offer, shares of Common Stock were accepted on a pro rata basis. In connection with the tender offer, we repurchased, canceled and retired 10,000,000 shares of our Common Stock for an aggregate purchase price of $210,000,000 , excluding fees and expenses related to the tender offer, which were $301,000 . Based on the actual total number of shares tendered, Urban II received $208,140,000 of the aggregate purchase price paid. We funded the tender offer using available cash from asset sales and borrowings on our unsecured credit facility. The purchased shares represented approximately 10.24% of our then-outstanding shares of Common Stock. As a result of the repurchase, our stockholders' equity was reduced by the amount we paid for the repurchased shares and the related expenses. Warrants Each Unit consists of (i) one share of Series A Preferred Stock (Note 11) and (ii) one Warrant (Note 11) which allows the holder to purchase 0.25 of a share of Common Stock. The Warrants are exercisable beginning on the first anniversary of the date of their original issuance until and including the fifth anniversary of the date of such issuance. The exercise price of each Warrant is at a 15.0% premium to the per share estimated net asset value of our Common Stock (as most recently published by us at the time of each issuance). Proceeds and expenses from the sale of the Units are allocated to the Series A Preferred Stock and Warrants using their relative fair values on the date of issuance. As of June 30, 2017 , we had issued 308,775 Warrants in connection with our offering of Units and allocated net proceeds of $32,000 , after specifically identifiable offering costs and allocated general offering costs, to the Warrants in permanent equity. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | 6 Months Ended |
Jun. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES Hedges of Interest Rate Risk In order to manage financing costs and interest rate exposure related to our $385,000,000 unsecured term loan facility (Note 8), on August 13, 2015, we entered into interest rate swap agreements with multiple counterparties. These swap agreements became effective on November 2, 2015. Each of our interest rate swap agreements meets the criteria for cash flow hedge accounting treatment and we have designated the interest rate swap agreements as cash flow hedges of the risk of variability attributable to changes in the one-month LIBOR on the term loan facility. Accordingly, the interest rate swaps are recorded on the consolidated balance sheets at fair value and the changes in the fair value of the swaps are recorded in OCI and reclassified to earnings as an adjustment to interest expense as interest becomes receivable or payable (Note 2). We do not expect any significant losses from counterparty defaults related to our swap agreements. Summary of Derivatives The following table sets forth the key terms of our interest rate swap contracts: Number of Interest Total Notional Fixed Rates Floating Rate Index Effective Expiration (in thousands) 10 $ 385,000 1.559% - 1.569% One-Month LIBOR 11/2/2015 5/8/2020 _______________________________________________________________________________ (1) See Note 14 for our fair value disclosures. (2) Our interest rate swaps are not subject to master netting arrangements. These swaps hedge the future cash flows of interest payments on our $385,000,000 unsecured term loan facility by fixing the rate until May 8, 2020 at a weighted average rate of 1.563% plus the credit spread, which was 1.60% at June 30, 2017 and December 31, 2016 , or an all-in rate of 3.16% . Credit-Risk-Related Contingent Features Each of our interest rate swap agreements contains a provision under which we could also be declared in default under such agreements if we default on the term loan facility. As of June 30, 2017 and December 31, 2016 , there have been no events of default under our interest rate swap agreements. Impact of Hedges on AOCI and Consolidated Statements of Operations The changes in the balance of each component of AOCI related to our interest rate swaps designated as cash flow hedges are as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands) Accumulated other comprehensive income (loss), at beginning of period $ 1,043 $ (10,444 ) $ (509 ) $ (2,519 ) Other comprehensive income (loss) before reclassifications (983 ) (3,535 ) (189 ) (12,568 ) Amounts reclassified from accumulated other comprehensive income (loss) (1) 543 1,090 1,301 2,198 Net current period other comprehensive income (loss) (440 ) (2,445 ) 1,112 (10,370 ) Accumulated other comprehensive income (loss), at end of period $ 603 $ (12,889 ) $ 603 $ (12,889 ) _______________________________________________________________________________ (1) The amounts from AOCI are reclassified as an increase to interest expense in the statements of operations. Future Reclassifications from AOCI We estimate that $1,108,000 related to our derivatives designated as cash flow hedges will be reclassified out of AOCI as an increase to interest expense during the next twelve months. On August 3, 2017 , we repaid $65,000,000 of outstanding borrowings on our unsecured term loan facility. In connection with such pay down, we terminated three interest rate swaps with an aggregate notional value of $65,000,000 . Costs incurred to terminate such swaps totaled $38,000 , which will be reflected in earnings. At June 30, 2017 , a positive fair value of $101,000 was included in accumulated other comprehensive income on our consolidated balance sheet related to the swaps that we terminated. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS We determine the estimated fair value of financial assets and liabilities utilizing a hierarchy of valuation techniques based on whether the inputs to a fair value measurement are considered to be observable or unobservable in a marketplace. The hierarchy for inputs used in measuring fair value is as follows: Level 1 Inputs —Quoted prices in active markets for identical assets or liabilities Level 2 Inputs —Observable inputs other than quoted prices in active markets for identical assets and liabilities Level 3 Inputs —Unobservable inputs In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. Our derivative financial instruments (Note 13) are measured at fair value on a recurring basis and are presented on our consolidated balance sheets at fair value, on a gross basis, excluding accrued interest. The table below presents the fair value of our derivative financial instruments as well as their classification on our consolidated balance sheets: June 30, 2017 December 31, 2016 Level Balance Sheet (in thousands) Assets (Liabilities): Interest rate swaps $ 603 $ (509 ) 2 Other assets (Other liabilities) Interest Rate Swaps —We estimate the fair value of our interest rate swaps by calculating the credit-adjusted present value of the expected future cash flows of each swap. The calculation incorporates the contractual terms of the derivatives, observable market interest rates which we consider to be Level 2 inputs, and credit risk adjustments, if any, to reflect the counterparty's as well as our own nonperformance risk. The estimated fair values of those financial instruments which are not recorded at fair value on a recurring basis on our consolidated balance sheets are as follows: June 30, 2017 December 31, 2016 Carrying Estimated Carrying Estimated Level (in thousands) Assets: Loans receivable subject to credit risk $ 46,276 $ 46,176 $ 43,623 $ 43,621 3 SBA 7(a) loans receivable, subject to secured borrowings 24,162 24,607 29,524 29,976 3 Other loans receivable 1,356 1,297 2,593 2,550 3 Liabilities: Mortgages payable (1) 414,672 417,912 530,793 516,892 3 Junior subordinated notes 25,093 25,490 25,055 25,173 3 _______________________________________________________________________________ (1) The June 30, 2017 carrying amount and estimated fair value of mortgages payable excludes two mortgage loans that have been classified as liabilities associated with assets held for sale on our consolidated balance sheet at June 30, 2017 (Notes 3 and 8). Management's estimation of the fair value of our financial instruments other than our interest rate swaps is based on a Level 3 valuation in the fair value hierarchy established for disclosure of how a company values its financial instruments. In general, quoted market prices from active markets for the identical financial instrument (Level 1 inputs), if available, should be used to value a financial instrument. If quoted prices are not available for the identical financial instrument, then a determination should be made if Level 2 inputs are available. Level 2 inputs include quoted prices for similar financial instruments in active markets for identical or similar financial instruments in markets that are not active (i.e., markets in which there are few transactions for the financial instruments, the prices are not current, price quotations vary substantially, or in which little information is released publicly). There is limited reliable market information for our financial instruments other than our interest rate swaps and we utilize other methodologies based on unobservable inputs for valuation purposes since there are no Level 1 or Level 2 inputs available. Accordingly, Level 3 inputs are used to measure fair value. In general, estimates of fair value may differ from the carrying amounts of the financial assets and liabilities primarily as a result of the effects of discounting future cash flows. Considerable judgment is required to interpret market data and develop estimates of fair value. Accordingly, the estimates presented are made at a point in time and may not be indicative of the amounts we could realize in a current market exchange. The carrying amounts of our secured borrowings and unsecured credit and term loan facilities approximate their fair values, as the interest rates on these securities are variable and approximate current market interest rates. Loans Receivable Subject to Credit Risk and Other Loans Receivable —Loans receivable were initially recorded at estimated fair value at the Acquisition Date. Loans receivable originated subsequent to the Acquisition Date are recorded at cost upon origination and adjusted by net loan origination fees and discounts. In order to determine the estimated fair value of our loans receivable, we use a present value technique for the anticipated future cash flows using certain assumptions. At June 30, 2017 , our assumptions included discount rates ranging from 8.75% to 13.75% and prepayment rates ranging from 5.80% to 20.00% . At December 31, 2016 , our assumptions included discount rates ranging from 8.25% to 13.25% and prepayment rates ranging from 5.80% to 20.00% . SBA 7(a) Loans Receivable, Subject to Secured Borrowings —These loans receivable represent the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans. There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal. In order to determine the estimated fair value of these loans receivable, we use a present value technique for the anticipated future cash flows taking into consideration the lack of credit risk and using a range of prepayment rates from 6.70% to 20.00% at both June 30, 2017 and December 31, 2016 . Mortgages Payable —The fair values of mortgages payable are estimated based on current interest rates available for debt instruments with similar terms. The fair value of our mortgages payable is sensitive to fluctuations in interest rates. Discounted cash flow analysis is generally used to estimate the fair value of our mortgages payable, using rates ranging from 4.11% to 4.26% and 4.60% to 4.72% at June 30, 2017 and December 31, 2016 , respectively. Junior Subordinated Notes —The fair value of the junior subordinated notes is estimated based on current interest rates available for debt instruments with similar terms. Discounted cash flow analysis is generally used to estimate the fair value of our junior subordinated notes. The rate used was 5.05% and 4.83% at June 30, 2017 and December 31, 2016 , respectively. |
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS | RELATED-PARTY TRANSACTIONS In May 2005, CIM Urban and CIM Urban REIT Management, L.P., each an affiliate of CIM REIT and CIM Group, entered into an Investment Management Agreement, pursuant to which CIM Urban engaged CIM Urban REIT Management, L.P. to provide investment advisory services to CIM Urban. CIM Investment Advisors, LLC, an affiliate of CIM REIT and CIM Group, registered with the SEC as an investment adviser and, in connection with such registration, CIM Urban entered into a new Investment Management Agreement with CIM Investment Advisors, LLC, in December 2015, on terms substantially similar to those in the previous Investment Management Agreement, pursuant to which CIM Urban engaged CIM Investment Advisors, LLC to provide investment advisory services, and the previous Investment Management Agreement was terminated. "Advisor" refers to CIM Urban REIT Management, L.P. prior to December 10, 2015 and to CIM Investment Advisors, LLC on and after December 10, 2015. CIM Urban pays asset management fees to the Advisor on a quarterly basis in arrears. The fee is calculated as a percentage of the daily average adjusted fair value of CIM Urban's investments, as defined, as follows: Daily Average Adjusted Fair Quarterly Fee From Greater of To and Including (in thousands) $ — $ 500,000 0.2500% 500,000 1,000,000 0.2375% 1,000,000 1,500,000 0.2250% 1,500,000 4,000,000 0.2125% 4,000,000 20,000,000 0.1000% The Advisor earned asset management fees of $6,130,000 and $6,238,000 for the three months ended June 30, 2017 and 2016 , respectively, and $12,544,000 and $12,716,000 for the six months ended June 30, 2017 and 2016 , respectively. At June 30, 2017 and December 31, 2016 , asset management fees of $6,107,000 and $6,448,000 , respectively, were due to the Advisor. CIM Management, Inc. and certain of its affiliates (collectively, the "CIM Management Entities"), all affiliates of CIM REIT and CIM Group, provide property management, leasing, and development services to CIM Urban. The CIM Management Entities earned property management fees, which are included in rental and other property operating expenses, totaling $1,306,000 and $1,405,000 for the three months ended June 30, 2017 and 2016 , respectively, and $2,738,000 and $2,815,000 for the six months ended June 30, 2017 and 2016 , respectively. CIM Urban also reimbursed the CIM Management Entities $2,556,000 and $2,245,000 during the three months ended June 30, 2017 and 2016 , respectively, and $4,686,000 and $4,007,000 during the six months ended June 30, 2017 and 2016 , respectively, for the cost of on-site personnel incurred on behalf of CIM Urban, which is included in rental and other property operating expenses. The CIM Management Entities earned leasing commissions of $210,000 and $688,000 for the three months ended June 30, 2017 and 2016 , respectively, and $371,000 and $754,000 for the six months ended June 30, 2017 and 2016 , respectively, which were capitalized to deferred charges. In addition, the CIM Management Entities earned construction management fees of $91,000 and $410,000 for the three months ended June 30, 2017 and 2016 , respectively, and $275,000 and $668,000 for the six months ended June 30, 2017 and 2016 , respectively, which were capitalized to investments in real estate. At June 30, 2017 and December 31, 2016 , fees payable and expense reimbursements due to the CIM Management Entities of $2,450,000 and $2,027,000 , respectively, are included in due to related parties. Also included in due from related parties as of June 30, 2017 and December 31, 2016 , was $591,000 and $214,000 , respectively, due from the CIM Management Entities and related parties. On the Acquisition Date, pursuant to the terms of the Merger Agreement, CIM Commercial and its subsidiaries entered into the Master Services Agreement (the "Master Services Agreement") with CIM Service Provider, LLC (the "Manager"), an affiliate of CIM Group, pursuant to which the Manager agrees to provide or arrange for other service providers to provide management and administration services to CIM Commercial and its subsidiaries following the Merger. Pursuant to the Master Services Agreement, we appointed an affiliate of CIM Group as the manager of Urban Partners GP, LLC. Under the Master Services Agreement, CIM Commercial pays a base service fee (the "Base Service Fee") to the Manager initially set at $1,000,000 per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015), payable quarterly in arrears. The Manager earned a Base Service Fee of $265,000 and $271,000 for the three months ended June 30, 2017 and 2016 , respectively, and $530,000 and $525,000 for the six months ended June 30, 2017 and 2016 , respectively. In addition, pursuant to the terms of the Master Services Agreement, the Manager may receive compensation and/or reimbursement for performing certain services for CIM Commercial and its subsidiaries that are not covered under the Base Service Fee. During the six months ended June 30, 2017 and 2016 , such services performed by the Manager included accounting, tax, reporting, internal audit, legal, compliance, risk management, IT, human resources and corporate communications. The Manager's compensation is based on the salaries and benefits of the employees of the Manager and/or its affiliates who performed these services (allocated based on the percentage of time spent on the affairs of CIM Commercial and its subsidiaries). We expensed $560,000 and $860,000 for the three months ended June 30, 2017 and 2016 , respectively, and $1,622,000 and $1,726,000 for the six months ended June 30, 2017 and 2016 , respectively, for such services which are included in asset management and other fees to related parties. At June 30, 2017 and December 31, 2016 , $2,234,000 and $1,935,000 was due to the Manager, respectively, for such services. On January 1, 2015, we entered into a Staffing and Reimbursement Agreement with CIM SBA Staffing, LLC ("CIM SBA"), an affiliate of CIM Group and our subsidiary, PMC Commercial Lending, LLC. The Agreement provides that CIM SBA will provide personnel and resources to us and that we will reimburse CIM SBA for the costs and expenses of providing such personnel and resources. For the three months ended June 30, 2017 and 2016 , we incurred expenses related to services subject to reimbursement by us under this agreement of $784,000 and $884,000 , respectively, which are included in asset management and other fees to related parties for lending segment costs included in continuing operations, $124,000 and $123,000 , respectively, for corporate services, which are included in asset management and other fees to related parties, and $0 and $148,000 , respectively, which are included in discontinued operations; for the six months ended June 30, 2017 and 2016 , we incurred expenses related to such services of $1,628,000 and $1,814,000 , respectively, which are included in asset management and other fees to related parties for lending segment costs included in continuing operations, $239,000 and $226,000 , respectively, for corporate services, which are included in asset management and other fees to related parties, and $0 and $280,000 , respectively, which are included in discontinued operations. In addition, we deferred personnel costs of $110,000 and $70,000 for the three months ended June 30, 2017 and 2016 , respectively, and $154,000 and $149,000 for the six months ended June 30, 2017 and 2016 , respectively, associated with services provided for originating loans. On October 1, 2015, an affiliate of CIM Group entered into a 5 -year lease renewal with respect to a property owned by the Company. We recorded rental and other property income related to this tenant of $27,000 for each of the three months ended June 30, 2017 and 2016 and $54,000 for each of the six months ended June 30, 2017 and 2016 . On May 16, 2016 , we announced a cash tender offer to purchase up to 10,000,000 shares of our Common Stock at a price of $21.00 per share. In connection with the tender offer, we repurchased, canceled and retired 10,000,000 shares of our Common Stock for an aggregate purchase price of $210,000,000 , excluding fees and expenses related to the tender offer, which were $301,000 . Based on the actual total number of shares tendered, Urban II received $208,140,000 of the aggregate purchase price paid (Note 12). In addition, on June 12, 2017 , we repurchased, in a privately negotiated transaction, canceled and retired 26,181,818 shares of Common Stock from Urban II. The aggregate purchase price was $576,000,000 , or $22.00 per share (Note 12). |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Loan Commitments —Commitments to extend credit are agreements to lend to a customer provided the terms established in the contract are met. Our outstanding loan commitments to fund loans were $25,877,000 at June 30, 2017 and are for prime-based loans to be originated by our subsidiary engaged in SBA 7(a) Program lending, the government guaranteed portion of which is intended to be sold. Commitments generally have fixed expiration dates. Since some commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements. General —In connection with the ownership and operation of real estate properties, we have certain obligations for the payment of tenant improvement allowances and lease commissions in connection with new leases and renewals. CIM Commercial had a total of $29,971,000 in future obligations under leases to fund tenant improvements and other future construction obligations at June 30, 2017 . At June 30, 2017 , $12,648,000 was funded to reserve accounts included in restricted cash on our consolidated balance sheet for these tenant improvement obligations in connection with the mortgage loan agreements entered into in June 2016. Employment Agreements —We have employment agreements with two of our officers. Pursuant to these employment agreements, we issued an aggregate of 76,423 shares of Common Stock under the 2015 Equity Incentive Plan as retention bonuses to these officers in January 2016 (as each executive was not entitled to any disability, death or severance payments on such date). These shares vested immediately. We accrued associated payroll taxes of $444,000 at December 31, 2015 , which were paid in January 2016, and recorded no compensation expense during the three and six months ended June 30, 2017 and 2016 related to these retention bonuses. In addition, under certain circumstances, each of these employment agreements currently provides for (1) severance payment equal to the annual base salary paid to the officer and (2) death and disability payments in an amount equal to two times and one time, respectively, the annual base salary paid to the officers. At June 30, 2017 , there was no unrecognized compensation expense related to these awards. Litigation —We are not currently involved in any material pending or threatened legal proceedings nor, to our knowledge, are any material legal proceedings currently threatened against us, other than routine litigation arising in the ordinary course of business. In the normal course of business, we are periodically party to certain legal actions and proceedings involving matters that are generally incidental to our business. While the outcome of these legal actions and proceedings cannot be predicted with certainty, in management's opinion, the resolution of these legal proceedings and actions will not have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations, to maintain our level of Common Stock or Series A Preferred Stock dividend distributions or to engage in further repurchases of Common Stock. In April 2017, the City and County of San Francisco filed suit against certain of our subsidiaries and us claiming past due real property transfer tax relating to a transaction in a prior year totaling, as of June 30, 2017, approximately $11,592,000 , including penalties and interest. In June 2017, we filed a demurrer against the City and County of San Francisco. The demurrer was denied in July 2017. We filed a writ to appeal the denial of the demurrer in early August 2017. If the writ is denied, we will need to pay the City and County of San Francisco such asserted tax obligations in order to continue to contest them. Accordingly, we have accrued $11,592,000 related to the asserted tax obligations as of June 30, 2017 and have reflected the related expense in transaction costs in our consolidated statements of operations for the three and six months ended June 30, 2017 . Due to the early stage of the suit and the uncertainty and risks inherent in litigation, we cannot determine the amount, if any, of the previously assessed and currently accrued tax obligations, will be recovered through the appeal process. We believe that we have defenses to, and intend to continue to vigorously contest, the asserted tax obligations. SBA Related —If the SBA establishes that a loss on an SBA guaranteed loan is attributable to significant technical deficiencies in the manner in which the loan was originated, funded or serviced under the SBA 7(a) Program, the SBA may seek recovery of the principal loss related to the deficiency from us. With respect to the guaranteed portion of SBA loans that have been sold, the SBA will first honor its guarantee and then seek compensation from us in the event that a loss is deemed to be attributable to technical deficiencies. Based on historical experience, we do not expect that this contingency is probable to be asserted. However, if asserted, it could have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations, to maintain our level of Common Stock or Series A Preferred Stock dividend distributions or to engage in further repurchases of Common Stock. Environmental Matters —In connection with the ownership and operation of real estate properties, we may be potentially liable for costs and damages related to environmental matters, including asbestos-containing materials. We have not been notified by any governmental authority of any noncompliance, liability, or other claim in connection with any of the properties, and we are not aware of any other environmental condition with respect to any of the properties that management believes will have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations, to maintain our level of Common Stock or Series A Preferred Stock dividend distributions or to engage in further repurchases of Common Stock. Rent Expense —The ground lease for a property provides for current annual rent of $503,000 , payable quarterly, with increases every five years after July 1, 2015 based on the greater of 15% or 50% of the increase in the Consumer Price Index during a five -year adjustment period. In addition, commencing on July 1, 2040 and July 1, 2065, the rent payable during the balance of the lease term shall be increased by an amount equal to 10% of the rent payable during the immediately preceding lease year. The lease term is through May 31, 2089. If the landlord decides to sell the leased property, we have the right of first refusal. Rent expense under this lease, which includes straight-line rent and amortization of acquired below-market ground lease, was $438,000 for each of the three months ended June 30, 2017 and 2016 and $876,000 for each of the six months ended June 30, 2017 and 2016 . We record rent expense on a straight-line basis. Straight-line rent liability of $13,843,000 and $13,289,000 is included in other liabilities in the accompanying consolidated balance sheets as of June 30, 2017 and December 31, 2016 , respectively. We lease office space in Dallas, Texas under a lease which expires in May 2018. We recorded rent expense of $56,000 and $56,000 for the three months ended June 30, 2017 and 2016 , respectively, and $112,000 and $114,000 for the six months ended June 30, 2017 and 2016 , respectively. Scheduled future noncancelable minimum lease payments at June 30, 2017 are as follows: Years Ending December 31, (in thousands) 2017 (Six months ending December 31, 2017) $ 375 2018 607 2019 503 2020 541 2021 578 Thereafter 127,101 $ 129,705 |
FUTURE MINIMUM LEASE RENTALS
FUTURE MINIMUM LEASE RENTALS | 6 Months Ended |
Jun. 30, 2017 | |
Leases, Operating [Abstract] | |
FUTURE MINIMUM LEASE RENTALS | FUTURE MINIMUM LEASE RENTALS Future minimum rental revenue under long-term operating leases at June 30, 2017 , excluding tenant reimbursements of certain costs, are as follows: Years Ending December 31, Governmental Other Total (in thousands) 2017 (Six months ending December 31, 2017) $ 23,641 $ 42,985 $ 66,626 2018 47,795 84,583 132,378 2019 50,079 76,353 126,432 2020 48,002 67,531 115,533 2021 36,307 56,511 92,818 Thereafter 122,999 168,790 291,789 $ 328,823 $ 496,753 $ 825,576 _______________________________________________________________________________ (1) Excludes future minimum rental revenue of 7083 Hollywood Boulevard, which is classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). |
CONCENTRATIONS
CONCENTRATIONS | 6 Months Ended |
Jun. 30, 2017 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | CONCENTRATIONS Tenant Revenue Concentrations —Rental revenue, excluding tenant reimbursements of certain costs, from the U.S. General Services Administration and other government agencies (collectively, "Governmental Tenants"), which primarily occupy properties located in Washington, D.C., accounted for approximately 21.4% and 19.0% of our rental and other property income for the three months ended June 30, 2017 and 2016 , respectively, and 20.4% and 19.5% for the six months ended June 30, 2017 and 2016 , respectively. At June 30, 2017 and December 31, 2016 , $11,946,000 and $8,339,000 , respectively, was due from Governmental Tenants (Note 17). Geographical Concentrations of Investments in Real Estate —As of June 30, 2017 and December 31, 2016 , we owned 17 and 20 office properties, respectively, two and five multifamily properties, respectively, one hotel property, two and three parking garages, respectively, and two development sites, one of which is being used as a parking lot. These properties are located in three and four states, respectively, and Washington, D.C. Our revenue concentrations from properties are as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 California 61.1 % 65.1 % 62.2 % 64.9 % Washington, D.C. 23.7 20.6 22.2 20.9 Texas 8.0 8.1 7.9 8.0 North Carolina 4.9 4.2 5.6 4.2 New York 2.3 2.0 2.1 2.0 100.0 % 100.0 % 100.0 % 100.0 % Our real estate investments concentrations from properties are as follows: June 30, 2017 December 31, 2016 California (1) 50.2 % 50.8 % Washington, D.C. 39.9 32.3 Texas (1) 5.2 7.7 New York (1) 4.7 3.7 North Carolina — 5.5 100.0 % 100.0 % _______________________________________________________________________________ (1) Includes the assets of 7083 Hollywood Boulevard, 4200 Scotland Street, and 47 E 34th Street, all of which are classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). |
SEGMENT DISCLOSURE
SEGMENT DISCLOSURE | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT DISCLOSURE | SEGMENT DISCLOSURE In accordance with ASC Topic 280, Segment Reporting , our reportable segments consist of three types of commercial real estate properties, namely, office, hotel and multifamily, as well as a segment for our lending business that is included in our continuing operations. The lending business that is held for sale for the three and six months ended June 30, 2016 is not included in our reportable segments. Management internally evaluates the operating performance and financial results of the segments based on net operating income. We also have certain general and administrative level activities, including public company expenses, legal, accounting, and tax preparation that are not considered separate operating segments. The reportable segments are accounted for on the same basis of accounting as described in the notes to our audited consolidated financial statements for the year ended December 31, 2016 included in our Annual Report on Form 10-K filed with the SEC on March 16, 2017. We evaluate the performance of our real estate segments based on net operating income, which is defined as rental and other property income and expense reimbursements less property related expenses, and excludes non-property income and expenses, interest expense, depreciation and amortization, corporate related general and administrative expenses, gain (loss) on sale of real estate, impairment of real estate, transaction costs, and provision for income taxes. For the lending segment, we define net operating income as interest income net of interest expense and general overhead expenses. The net operating income of our segments included in continuing operations for the three and six months ended June 30, 2017 and 2016 is as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands) Office: Revenues $ 43,914 $ 45,770 $ 93,007 $ 91,819 Property expenses: Operating 17,804 19,930 31,557 38,417 General and administrative 394 91 682 445 Total property expenses 18,198 20,021 32,239 38,862 Segment net operating income—office 25,716 25,749 60,768 52,957 Hotel: Revenues 10,604 14,496 21,122 29,779 Property expenses: Operating 6,586 9,431 13,025 19,386 General and administrative 35 306 39 393 Total property expenses 6,621 9,737 13,064 19,779 Segment net operating income—hotel 3,983 4,759 8,058 10,000 Multifamily: Revenues 4,714 5,172 9,717 10,230 Property expenses: Operating 2,859 2,938 5,627 5,774 General and administrative 113 97 342 355 Total property expenses 2,972 3,035 5,969 6,129 Segment net operating income—multifamily 1,742 2,137 3,748 4,101 Lending: Revenues 2,067 2,922 4,402 5,149 Lending expenses: Interest expense (55 ) (7 ) 87 182 Fees to related party 784 884 1,628 1,814 General and administrative 310 419 677 598 Total lending expenses 1,039 1,296 2,392 2,594 Segment net operating income—lending 1,028 1,626 2,010 2,555 Total segment net operating income $ 32,469 $ 34,271 $ 74,584 $ 69,613 A reconciliation of our segment net operating income to net income attributable to the Company for the three and six months ended June 30, 2017 and 2016 is as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands) Total segment net operating income $ 32,469 $ 34,271 $ 74,584 $ 69,613 Asset management and other fees to related parties (7,079 ) (7,492 ) (14,935 ) (15,193 ) Interest expense (9,568 ) (7,302 ) (19,199 ) (13,928 ) General and administrative (795 ) (1,218 ) (1,586 ) (2,282 ) Transaction costs (11,615 ) (118 ) (11,628 ) (267 ) Depreciation and amortization (14,761 ) (18,480 ) (31,992 ) (36,538 ) Impairment of real estate (13,100 ) — (13,100 ) — Gain on sale of real estate 116,283 — 304,017 24,739 Income (loss) from continuing operations before provision for income taxes 91,834 (339 ) 286,161 26,144 Provision for income taxes (462 ) (471 ) (854 ) (661 ) Net income (loss) from continuing operations 91,372 (810 ) 285,307 25,483 Discontinued operations: Income from operations of assets held for sale — 1,668 — 2,358 Net income from discontinued operations — 1,668 — 2,358 Net income 91,372 858 285,307 27,841 Net income attributable to noncontrolling interests (9 ) (9 ) (14 ) (12 ) Net income attributable to the Company $ 91,363 $ 849 $ 285,293 $ 27,829 The condensed assets for each of the segments as of June 30, 2017 and December 31, 2016 , along with capital expenditures and loan originations for the six months ended June 30, 2017 and 2016 , are as follows: June 30, 2017 December 31, 2016 (in thousands) Condensed assets: Office (1) $ 1,235,540 $ 1,568,702 Hotel 110,655 115,955 Multifamily (2) 107,412 170,159 Lending assets 86,307 91,191 Non-segment assets 98,041 76,877 Total assets $ 1,637,955 $ 2,022,884 Six Months Ended June 30, 2017 2016 (in thousands) Capital expenditures (3): Office $ 11,973 $ 18,839 Hotel 74 336 Multifamily 224 241 Total capital expenditures 12,271 19,416 Loan originations 23,875 49,976 Total capital expenditures and loan originations (4) $ 36,146 $ 69,392 _______________________________________________________________________________ (1) Includes the assets of 7083 Hollywood Boulevard, which are classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). (2) Includes the assets of 4200 Scotland Street and 47 E 34th Street, both of which are classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). (3) Represents additions and improvements to real estate investments, excluding acquisitions. (4) Includes the activity for dispositions through their respective disposition dates. |
BASIS OF PRESENTATION AND SUM28
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Interim Financial Information | Interim Financial Information —The accompanying interim consolidated financial statements of CIM Commercial have been prepared by our management in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim consolidated financial statements do not include all of the information and notes required by GAAP for complete financial statements. The accompanying financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods. Operating results for the three and six months ended June 30, 2017 are not necessarily indicative of the results that may be expected for the year ending December 31, 2017 . Our accompanying interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K filed with the SEC on March 16, 2017 . |
Principles of Consolidation | Principles of Consolidation —The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Investments in Real Estate | Investments in Real Estate —Real estate acquisitions are recorded at cost as of the acquisition date. Costs related to the acquisition of properties are expensed as incurred. Investments in real estate are stated at depreciated cost. Depreciation and amortization are recorded on a straight line basis over the estimated useful lives as follows: Buildings and improvements 15 - 40 years Furniture, fixtures, and equipment 3 - 5 years Tenant improvements Shorter of the useful lives or the Improvements and replacements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. Ordinary repairs and maintenance are expensed as incurred. Investments in real estate are evaluated for impairment on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. The estimated fair value of the asset group identified for step two of the impairment testing under GAAP is based on either the income approach with market discount rate, terminal capitalization rate and rental rate assumptions being most critical, or on the sales comparison approach to similar properties. Assets to be disposed of are reported at the lower of the carrying amount or fair value, less costs to sell. |
Derivative Financial Instruments | Derivative Financial Instruments —As part of our risk management and operational strategies, from time to time, we may enter into derivative contracts with various counterparties. All derivatives are recognized on the balance sheet at their estimated fair value. On the date that we enter into a derivative contract, we designate the derivative as a fair value hedge, a cash flow hedge, a foreign currency fair value or cash flow hedge, a hedge of a net investment in a foreign operation, or a trading or non-hedging instrument. Changes in the estimated fair value of a derivative that is highly effective and that is designated and qualifies as a cash flow hedge, to the extent that the hedge is effective, are initially recorded in other comprehensive income ("OCI"), and are subsequently reclassified into earnings as a component of interest expense when the variability of cash flows of the hedged transaction affects earnings (e.g., when periodic settlements of a variable-rate asset or liability are recorded in earnings). Any hedge ineffectiveness (which represents the amount by which the changes in the estimated fair value of the derivative differ from the variability in the cash flows of the forecasted transaction) is recognized in current-period earnings as a component of interest expense. When an interest rate swap designated as a cash flow hedge no longer qualifies for hedge accounting, we recognize changes in estimated fair value of the hedge previously deferred to accumulated other comprehensive income ("AOCI"), along with any changes in estimated fair value occurring thereafter, through earnings. We classify cash flows from interest rate swap agreements as net cash provided from operating activities on the consolidated statements of cash flows as our accounting policy is to present the cash flows from the hedging instruments in the same category in the consolidated statements of cash flows as the category for the cash flows from the hedged items. |
Loans Receivable | Loans Receivable —Our loans receivable included in other assets are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves. For loans originated under the Small Business Administration's ("SBA") 7(a) Guaranteed Loan Program ("SBA 7(a) Program"), we sell the portion of the loan that is guaranteed by the SBA. Upon sale of the SBA guaranteed portion of the loans, which are accounted for as sales, the unguaranteed portion of the loan retained by us is valued on a fair value basis and a discount (the "Retained Loan Discount") is recorded as a reduction in basis of the retained portion of the loan. At the Acquisition Date, the carrying value of our loans was adjusted to estimated fair market value and acquisition discounts of $33,907,000 were recorded, which are being accreted to interest and other income using the effective interest method. We sold substantially all of our commercial mortgage loans with unamortized acquisition discounts of $15,951,000 to an unrelated third party in December 2015 (Note 7). Acquisition discounts of $1,563,000 remained as of June 30, 2017 which have not yet been accreted to income. A loan receivable is generally classified as non-accrual (a "Non-Accrual Loan") if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and/or interest is in doubt. Generally, loans are charged-off when management determines that we will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means. Interest income, included in interest and other income or discontinued operations, on a Non-Accrual Loan is recognized on either the cash basis or the cost recovery basis. On a quarterly basis, and more frequently if indicators exist, we evaluate the collectability of our loans receivable. Our evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers' business models and future operations in accordance with Accounting Standards Codification ("ASC") 450-20, Contingencies—Loss Contingencies , and ASC 310-10, Receivables . For the three and six months ended June 30, 2017 , we recorded a net impairment of $0 and $12,000 on our loans receivable, respectively. For the three and six months ended June 30, 2016 , we recorded a net impairment (recovery) of $7,000 and $(236,000) on our loans receivable, respectively. We establish a general loan loss reserve when available information indicates that it is probable a loss has occurred based on the carrying value of the portfolio and the amount of the loss can be reasonably estimated. Significant judgment is required in determining the general loan loss reserve, including estimates of the likelihood of default and the estimated fair value of the collateral. The general loan loss reserve includes those loans, which may have negative characteristics which have not yet become known to us. In addition to the reserves established on loans not considered impaired that have been evaluated under a specific evaluation, we establish the general loan loss reserve using a consistent methodology to determine a loss percentage to be applied to loan balances. These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions. |
Deferred Rent Receivable and Charges | Deferred Rent Receivable and Charges —Deferred rent receivable and charges consist of deferred rent, deferred leasing costs, deferred offering costs (Note 11) and other deferred costs. Deferred rent receivable is $56,406,000 and $64,010,000 at June 30, 2017 and December 31, 2016 , respectively. Deferred leasing costs, which represent lease commissions and other direct costs associated with the acquisition of tenants, are capitalized and amortized on a straight-line basis over the terms of the related leases. Deferred leasing costs of $60,116,000 and $76,063,000 are presented net of accumulated amortization of $25,338,000 and $25,914,000 at June 30, 2017 and December 31, 2016 , respectively. Deferred offering costs represent direct costs incurred in connection with our offering of Units (as defined in Note 11), excluding costs specifically identifiable to a closing, such as commissions, dealer-manager fees, and other registration fees. For a specific issuance of Units, associated offering costs are reclassified as a reduction of proceeds raised on the issuance date. Offering costs incurred but not directly related to a specifically identifiable closing are deferred. Deferred offering costs are first allocated to each issuance on a pro-rata basis equal to the ratio of Units issued in an issuance to the maximum number of Units that are expected to be issued. Then, the deferred offering costs allocated to such issuance are further allocated to the Series A Preferred Stock (as defined in Note 11) and Warrants (as defined in Note 11) issued in such issuance based on the relative fair value of the instruments on the date of issuance. The deferred offering costs allocated to the Series A Preferred Stock and Warrants are reductions to temporary equity and permanent equity, respectively. |
Redeemable Preferred Stock | Redeemable Preferred Stock —Beginning on the date of original issuance of any given shares of Series A Preferred Stock (Note 11), the holder of such shares will have the right to require the Company to redeem such shares at a redemption price of 100% of the Stated Value (as defined in Note 11), plus accrued and unpaid dividends, subject to the payment of a redemption fee until the fifth anniversary of such issuance. From and after the fifth anniversary of the date of the original issuance, the holder will have the right to require the Company to redeem such shares at a redemption price of 100% of the Stated Value, plus accrued and unpaid dividends, without a redemption fee, and the Company will have the right (but not the obligation) to redeem such shares at 100% of the Stated Value, plus accrued and unpaid dividends. The applicable redemption price payable upon redemption of any Series A Preferred Stock will be in cash or, on or after the first anniversary of the issuance of such shares of Series A Preferred Stock to be redeemed, in the Company’s sole discretion, in cash or in equal value through the issuance of shares of Common Stock, based on the volume weighted average price of our Common Stock for the 20 trading days prior to the redemption. Since a holder of Series A Preferred Stock has the right to request redemption of such shares and redemptions prior to the first anniversary are to be paid in cash, we have recorded the activity related to our Series A Preferred Stock in temporary equity. We recorded the activity related to our Warrants (Note 11) in permanent equity. On the first anniversary of the date of original issuance of a particular share of Series A Preferred Stock, we intend to reclassify such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date. Proceeds and expenses from the sale of the Units are allocated to the Series A Preferred Stock and Warrants using their relative fair values on the date of issuance. |
Noncontrolling Interests | Noncontrolling Interests —Noncontrolling interests represent the interests in various properties owned by third parties. |
Restricted Cash | Restricted Cash —Our mortgage loan and hotel management agreements provide for depositing cash into restricted accounts reserved for property taxes, insurance, capital expenditures, free rent, tenant improvement and leasing commission obligations. Restricted cash also includes cash required to be segregated in connection with certain of our loans receivable. |
Assets Held for Sale and Discontinued Operations | Assets Held for Sale and Discontinued Operations —In the ordinary course of business, we may periodically enter into agreements relating to dispositions of investments. Some of these agreements are non-binding because either they do not obligate either party to pursue any transactions until the execution of a definitive agreement or they provide the potential buyer with the ability to terminate without penalty or forfeiture of any material deposit, subject to certain specified contingencies, such as completion of due diligence at the discretion of such buyer. We do not classify assets that are subject to such non-binding agreements as held for sale. We classify assets as held for sale, if material, when they meet the necessary criteria, which include: a) management commits to and actively embarks upon a plan to sell the assets, b) the assets to be sold are available for immediate sale in their present condition, c) the sale is expected to be completed within one year under terms usual and customary for such sales and d) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. We generally believe that we meet these criteria when the plan for sale has been approved by our board of directors (the "Board of Directors"), there are no known significant contingencies related to the sale and management believes it is probable that the sale will be completed within one year. Assets held for sale are recorded at the lower of cost or estimated fair value less cost to sell. In addition, if we were to determine that the asset disposal associated with assets held for sale or disposed of represents a strategic shift, the revenues, expenses and net gain (loss) on dispositions would be recorded in discontinued operations for all periods presented through the date of the applicable disposition. |
Consolidation Considerations for Our Investments in Real Estate | Consolidation Considerations for Our Investments in Real Estate —ASC 810-10, Consolidation , addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights that would require the entity to be consolidated. We analyze our investments in real estate in accordance with this accounting standard to determine whether they are variable interest entities, and if so, whether we are the primary beneficiary. Our judgment with respect to our level of influence or control over an entity and whether we are the primary beneficiary of a variable interest entity involves consideration of various factors, including the form of our ownership interest, our voting interest, the size of our investment (including loans), and our ability to participate in major policy-making decisions. Our ability to correctly assess our influence or control over an entity affects the presentation of these investments in our consolidated financial statements. |
Use of Estimates | Use of Estimates —The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Reclassifications | Reclassifications —Certain prior period amounts have been reclassified to conform with the current period presentation. These reclassifications had no effect on previously reported net income or cash flows. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements— In January 2016, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") No. 2016-01, Financial Instruments-Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities , which is designed to improve the recognition and measurement of financial instruments through targeted changes to existing GAAP. The ASU requires an entity to: (i) measure equity investments at fair value through net income, with certain exceptions; (ii) present in OCI the changes in instrument-specific credit risk for financial liabilities measured using the fair value option; (iii) present financial assets and financial liabilities by measurement category and form of financial asset; (iv) calculate the fair value of financial instruments for disclosure purposes based on an exit price; and (v) assess a valuation allowance on deferred tax assets related to unrealized losses of available-for-sale debt securities in combination with other deferred tax assets. In addition, the ASU provides an election to subsequently measure certain nonmarketable equity investments at cost less any impairment and adjusted for certain observable price changes. The ASU also requires a qualitative impairment assessment of such equity investments and amends certain fair value disclosure requirements. For public business entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption by public entities to financial statements that have not yet been issued is permitted only for the provision related to instrument-specific credit risk. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In February 2016, the FASB issued ASU No. 2016-02, Leases (Topic 842) , which is intended to improve financial reporting about leasing transactions. Under the new guidance, a lessee will be required to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with current GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily will depend on its classification as a finance or operating lease. However, unlike current GAAP, which requires a lessee to recognize only capital leases on the balance sheet, the new ASU will require a lessee to recognize both types of leases on the balance sheet. The lessor accounting will remain largely unchanged from current GAAP. However, the ASU contains some targeted improvements that are intended to align, where necessary, lessor accounting with the lessee accounting model and with the updated revenue recognition guidance issued in 2014. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2018. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In March 2016, the FASB issued ASU No. 2016-09, Compensation-Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting , which is intended to simplify several aspects of the accounting for share-based payment transactions, including accounting for income taxes, classification of excess tax benefits on the statement of cash flows, forfeitures, minimum statutory tax withholding requirements, and classification of employee taxes paid on the statement of cash flows when an employer withholds shares for tax-withholding purposes. In addition, the ASU eliminates certain guidance in ASC 718, which was indefinitely deferred shortly after the issuance of FASB Statement No. 123 (revised 2004), Share-Based Payment . For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. Early adoption is permitted and an entity that elects early adoption must adopt all of the amendments in the same period. The adoption of this guidance did not have a material impact on our consolidated financial statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity. The amendments in the ASU replaces the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2019. Early adoption is permitted for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2018. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In August 2016, the FASB issued ASU No. 2016-15, Statement of Cash Flows (Topic 230): Classification of Certain Cash Receipts and Cash Payments , which provides guidance on how certain cash receipts and cash payments are to be presented and classified in the statement of cash flows. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In November 2016, the FASB issued ASU No. 2016-18, Statement of Cash Flows (Topic 230): Restricted Cash , which requires that a statement of cash flows explain the change during the period in the total cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The amendments in this update do not provide a definition of restricted cash or restricted cash equivalents. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In December 2016, the FASB issued ASU No. 2016-20, Technical Corrections and Improvements to Topic 606, Revenue from Contracts with Customers , which make certain technical corrections and improvements to ASU 2014-09. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2017. Early adoption is permitted for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2016. The adoption of this guidance is not expected to have a material impact on our consolidated financial statements. In January 2017, the FASB issued ASU No. 2017-01, Business Combinations: Clarifying the Definition of a Business , which narrows the definition of a business and provides a framework that gives entities a basis for making reasonable judgments about whether a transaction involves an asset or a business. For public entities, the ASU is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2017. Early adoption is permitted under certain circumstances as outlined in the ASU. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. |
BASIS OF PRESENTATION AND SUM29
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful Lives of Real Estate | Depreciation and amortization are recorded on a straight line basis over the estimated useful lives as follows: Buildings and improvements 15 - 40 years Furniture, fixtures, and equipment 3 - 5 years Tenant improvements Shorter of the useful lives or the |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Disposal Group, Disposed of by Sale, Not Discontinued Operations | |
Disposals | |
Disposal Group Detail | The following is the detail of the carrying amount of assets and liabilities at the time of the sales of the properties in 2017: (in thousands) Assets Investments in real estate, net $ 319,078 Deferred rent receivable and charges, net 22,089 Other intangible assets, net 129 Other assets 38 Total assets $ 341,334 Liabilities Debt, net (1) $ 64,777 Intangible liabilities, net 1,800 Total liabilities $ 66,577 _______________________________________________________________________________ (1) Net of $665,000 of premium on assumed mortgage. Property Asset Date of Sale Rooms Sales Gain on (in thousands) Courtyard Oakland, Oakland, CA Hotel February 2, 2016 162 $ 43,800 $ 24,739 Property Asset Type Date of Sale Square Feet / Units Sales Price Gain on Sale (in thousands) 211 Main Street, San Francisco, CA Office March 28, 2017 417,266 $ 292,882 $ 187,734 3636 McKinney Avenue, Dallas, TX Multifamily May 30, 2017 103 $ 20,000 $ 5,488 3839 McKinney Avenue, Dallas, TX Multifamily May 30, 2017 75 $ 14,100 $ 4,224 200 S College Street, Charlotte, NC Office June 8, 2017 567,865 $ 148,500 $ 45,906 980 9th Street and 1010 8th Street, Sacramento, CA Office & Parking Garage June 20, 2017 485,926 $ 120,500 $ 34,829 4649 Cole Avenue, Dallas, TX Multifamily June 23, 2017 334 $ 64,000 $ 25,836 |
Disposal Group, Held-for-sale, Not Discontinued Operations | |
Disposals | |
Disposal Group Detail | The following is the detail of the carrying amounts of assets and liabilities of the properties that are classified as held for sale on our consolidated balance sheet as of June 30, 2017 : (in thousands) Assets Investments in real estate, net (1) $ 118,221 Cash and cash equivalents 2,904 Restricted cash 51 Accounts receivable, net 251 Deferred rent receivable and charges, net 1,865 Other intangible assets, net (2) 1,124 Other assets 722 Total assets held for sale, net $ 125,138 Liabilities Debt, net (3) $ 50,230 Accounts payable and accrued expenses 1,402 Due to related parties 195 Other liabilities 1,059 Total liabilities associated with assets held for sale, net $ 52,886 _______________________________________________________________________________ (1) Investments in real estate of $136,153,000 are presented net of accumulated depreciation of $17,932,000 . (2) Other intangible assets, net, represents a tax abatement asset of $4,273,000 associated with 47 E 34th Street, which is presented net of accumulated amortization of $3,149,000 . (3) Debt includes the outstanding principal balances of 7083 Hollywood Boulevard and 4200 Scotland Street, which are $21,700,000 and $28,868,000 , respectively. Debt is presented net of deferred loan costs of $524,000 and the accumulated amortization of $186,000 . |
INVESTMENTS IN REAL ESTATE (Tab
INVESTMENTS IN REAL ESTATE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Real Estate [Abstract] | |
Investments in Real Estate | Investments in real estate consist of the following: June 30, 2017 December 31, 2016 (in thousands) Land $ 244,072 $ 343,564 Land improvements 17,746 26,177 Buildings and improvements 1,064,191 1,475,415 Furniture, fixtures, and equipment 3,525 4,955 Tenant improvements 130,481 159,677 Work in progress 9,528 11,706 Investments in real estate 1,469,543 2,021,494 Accumulated depreciation (328,083 ) (414,552 ) Net investments in real estate $ 1,141,460 $ 1,606,942 |
OTHER INTANGIBLE ASSETS (Tables
OTHER INTANGIBLE ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Liabilities and Related Accumulated Amortization and Accretion | A schedule of our intangible assets and liabilities and related accumulated amortization and accretion as of June 30, 2017 and December 31, 2016 is as follows: Assets Liabilities June 30, 2017 Acquired Acquired Trade Name and License Acquired (in thousands) Gross balance $ 10,181 $ 11,685 $ 2,957 $ (5,722 ) Accumulated amortization (7,581 ) (1,632 ) — 4,584 $ 2,600 $ 10,053 $ 2,957 $ (1,138 ) Average useful life (in years) 10 84 Indefinite 7 Assets Liabilities December 31, 2016 Acquired Acquired Tax Acquired Trade Name and License Acquired (in thousands) Gross balance $ 215 $ 11,551 $ 4,273 $ 11,685 $ 2,957 $ (18,893 ) Accumulated amortization (180 ) (8,443 ) (2,873 ) (1,562 ) — 15,317 $ 35 $ 3,108 $ 1,400 $ 10,123 $ 2,957 $ (3,576 ) Average useful life (in years) 8 10 8 84 Indefinite 8 _______________________________________________________________________________ (1) Tax abatement is associated with 47 E 34th Street, which is classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). |
Schedule of Future Amortization and Accretion of Acquisition Related Intangible Assets | A schedule of future amortization and accretion of acquisition related intangible assets and liabilities as of June 30, 2017 , is as follows: Assets Liabilities Years Ending December 31, Acquired Acquired Acquired (in thousands) 2017 (Six months ending December 31, 2017) $ 373 $ 70 $ (428 ) 2018 723 140 (510 ) 2019 464 140 (200 ) 2020 207 140 — 2021 207 140 — Thereafter 626 9,423 — $ 2,600 $ 10,053 $ (1,138 ) |
OTHER ASSETS (Tables)
OTHER ASSETS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract] | |
Schedule of Other Assets | Other assets consist of the following: June 30, 2017 December 31, 2016 (in thousands) SBA 7(a) loans, subject to credit risk $ 46,276 $ 43,623 SBA 7(a) loans, subject to secured borrowings 24,162 29,524 Other assets 18,717 19,123 $ 89,155 $ 92,270 |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Discontinued Operations, Held-for-sale | |
DISCONTINUED OPERATIONS | |
Detail of Income From Operations of Assets Held for Sale Classified as Discontinued Operations | The following is the detail of income from operations of assets held for sale classified as discontinued operations on the consolidated statements of operations for the three and six months ended June 30, 2016 : Three Months Ended June 30, 2016 Six Months Ended June 30, 2016 (in thousands) Revenue —Interest and other income $ 2,416 $ 3,531 Expenses: Interest expense 588 876 Fees to related party 148 280 General and administrative 12 17 Total expenses 748 1,173 Income from operations of assets held for sale $ 1,668 $ 2,358 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Information on our debt is as follows: June 30, 2017 December 31, 2016 (in thousands) Mortgage loans with a fixed interest rate of 4.14% per annum, with monthly payments of interest only, and balances totaling $370,300,000 due on July 1, 2026. The loans are nonrecourse. One loan with an outstanding principal balance of $21,700,000 was reclassified to liabilities associated with assets held for sale at June 30, 2017 (Note 3). $ 370,300 $ 392,000 Mortgage loan with a fixed interest rate of 4.50% per annum, with monthly payments of interest only for 10 years, and payments of interest and principal starting in February 2022. The loan has a $42,008,000 balance due on January 5, 2027. The loan is nonrecourse. 46,000 46,000 Mortgage loans with a fixed interest rate of 5.39% per annum, with monthly payments of principal and interest, and balances totaling $35,695,000 due on March 1, 2021. The loans were nonrecourse. The loans were repaid in May and June 2017 in connection with the sale of the properties that were collateral for the loans. — 39,134 Mortgage loan with a fixed interest rate of 5.18% per annum, with monthly payments of principal and interest, and a balance of $26,232,000 due on June 5, 2021. The loan is nonrecourse. The loan was reclassified to liabilities associated with assets held for sale at June 30, 2017 (Note 3). — 29,167 Mortgage loan with a fixed interest rate of 6.65% per annum, with monthly payments of principal and interest. The loan had a 25-year amortization schedule with a $21,136,000 balance due on July 15, 2018. The loan was nonrecourse. The loan was repaid in March 2017 in connection with the sale of the property that was collateral for the loan. — 26,136 416,300 532,437 Deferred loan costs related to mortgage loans (1,628 ) (2,366 ) Premiums and discounts on assumed mortgages, net — 722 Total Mortgages Payable 414,672 530,793 Secured borrowing principal on SBA 7(a) loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 4.55% and 4.13% at June 30, 2017 and December 31, 2016, respectively. 18,504 23,122 Secured borrowing principal on SBA 7(a) loans sold for excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 2.33% and 1.83% at June 30, 2017 and December 31, 2016, respectively. 4,460 4,777 22,964 27,899 Unamortized premiums 1,638 2,077 Total Secured Borrowings—Government Guaranteed Loans 24,602 29,976 Unsecured term loan facility 385,000 385,000 Junior subordinated notes with a variable interest rate which resets quarterly based on the 90-day LIBOR plus 3.25%, with quarterly interest only payments. Balance due at maturity on March 30, 2035. 27,070 27,070 Unsecured credit facility — — 412,070 412,070 Deferred loan costs related to unsecured term loan and credit facilities (2,534 ) (2,938 ) Discount on junior subordinated notes (1,977 ) (2,015 ) Total Other 407,559 407,117 Total Debt $ 846,833 $ 967,886 |
Future Principal Payments on Debt | Future principal payments on our debt (face value) at June 30, 2017 are as follows: Years Ending December 31, Secured Borrowings Principal (1) Mortgages Other (3) Total (in thousands) 2017 (Six months ending December 31, 2017) $ 605 $ — $ — $ 605 2018 835 — — 835 2019 867 — — 867 2020 902 — — 902 2021 940 — — 940 Thereafter 18,815 416,300 412,070 847,185 $ 22,964 $ 416,300 $ 412,070 $ 851,334 _______________________________________________________________________________ (1) Principal payments are generally dependent upon cash flows received from the underlying loans. Our estimate of their repayment is based on scheduled principal payments on the underlying loans. Our estimate will differ from actual amounts to the extent we experience prepayments and/or loan liquidations or charge-offs. No payment is due unless payments are received from the borrowers on the underlying loans. (2) Excludes the future principal payments for 7083 Hollywood Boulevard and 4200 Scotland Street, which are classified as liabilities associated with assets held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). (3) Represents the junior subordinated notes and unsecured term loan facility. |
EARNINGS PER SHARE ("EPS") (Tab
EARNINGS PER SHARE ("EPS") (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Reconciliation of the Numerator and Denominator Used in Computing Basic and Diluted Per-share Computations | The following table reconciles the numerator and denominator used in computing our basic and diluted per-share computations for net income available to common stockholders for the three and six months ended June 30, 2017 and 2016 : Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands, except per share amounts) Numerator: Net income (loss) from continuing operations $ 91,372 $ (810 ) $ 285,307 $ 25,483 Net income attributable to noncontrolling interests (9 ) (9 ) (14 ) (12 ) Redeemable preferred stock dividends (72 ) — (103 ) — Numerator for basic and diluted net income (loss) from continuing operations available to common stockholders 91,291 (819 ) 285,190 25,471 Net income from discontinued operations — 1,668 — 2,358 Numerator for basic and diluted net income available to common stockholders $ 91,291 $ 849 $ 285,190 $ 27,829 Denominator: Basic weighted average shares outstanding 78,871 96,683 81,445 97,173 Effect of dilutive securities—contingently issuable shares and stock options — — — — Diluted weighted average shares and common stock equivalents outstanding 78,871 96,683 81,445 97,173 Basic and diluted net income (loss) available to common stockholders per share: Continuing operations $ 1.16 $ (0.01 ) $ 3.50 $ 0.26 Discontinued operations $ — $ 0.02 $ — $ 0.02 Net income $ 1.16 $ 0.01 $ 3.50 $ 0.29 |
REDEEMABLE PREFERRED STOCK (Tab
REDEEMABLE PREFERRED STOCK (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Series A Preferred Stock | |
Temporary Equity [Line Items] | |
Cash Dividends Declared on Series A Preferred Stock | Cash dividends declared on our Series A Preferred Stock for the three and six months ended June 30, 2017 consist of the following: Aggregate Declaration Date Payment Date Number of Shares Dividends Declared (in thousands) June 12, 2017 July 17, 2017 308,775 $ 72 March 8, 2017 April 17, 2017 144,698 $ 31 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Common Stock | |
Class of Stock [Line Items] | |
Dividends Per Share of Common Stock Declared | Dividends per share of Common Stock declared during the six months ended June 30, 2017 and 2016 consist of the following: Declaration Date Payment Date Type Dividend Per Common Share June 12, 2017 June 27, 2017 Special Cash $ 1.98000 June 12, 2017 June 27, 2017 Regular Quarterly $ 0.12500 April 5, 2017 April 24, 2017 Special Cash $ 0.28000 March 8, 2017 March 27, 2017 Regular Quarterly $ 0.21875 June 10, 2016 June 28, 2016 Regular Quarterly $ 0.21875 March 8, 2016 March 29, 2016 Regular Quarterly $ 0.21875 |
DERIVATIVE FINANCIAL INSTRUME39
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Key Terms of Interest Rate Swap Contract | The following table sets forth the key terms of our interest rate swap contracts: Number of Interest Total Notional Fixed Rates Floating Rate Index Effective Expiration (in thousands) 10 $ 385,000 1.559% - 1.569% One-Month LIBOR 11/2/2015 5/8/2020 _______________________________________________________________________________ (1) See Note 14 for our fair value disclosures. (2) Our interest rate swaps are not subject to master netting arrangements. |
Changes in the Balance of Each Component of AOCI Related to Interest Rate Swaps | The changes in the balance of each component of AOCI related to our interest rate swaps designated as cash flow hedges are as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands) Accumulated other comprehensive income (loss), at beginning of period $ 1,043 $ (10,444 ) $ (509 ) $ (2,519 ) Other comprehensive income (loss) before reclassifications (983 ) (3,535 ) (189 ) (12,568 ) Amounts reclassified from accumulated other comprehensive income (loss) (1) 543 1,090 1,301 2,198 Net current period other comprehensive income (loss) (440 ) (2,445 ) 1,112 (10,370 ) Accumulated other comprehensive income (loss), at end of period $ 603 $ (12,889 ) $ 603 $ (12,889 ) _______________________________________________________________________________ (1) The amounts from AOCI are reclassified as an increase to interest expense in the statements of operations. |
FAIR VALUE OF FINANCIAL INSTR40
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value and Classification of Derivative Financial Instruments | The table below presents the fair value of our derivative financial instruments as well as their classification on our consolidated balance sheets: June 30, 2017 December 31, 2016 Level Balance Sheet (in thousands) Assets (Liabilities): Interest rate swaps $ 603 $ (509 ) 2 Other assets (Other liabilities) |
Fair Values of Financial Instrument Not Recorded at Fair Value on a Recurring Basis | The estimated fair values of those financial instruments which are not recorded at fair value on a recurring basis on our consolidated balance sheets are as follows: June 30, 2017 December 31, 2016 Carrying Estimated Carrying Estimated Level (in thousands) Assets: Loans receivable subject to credit risk $ 46,276 $ 46,176 $ 43,623 $ 43,621 3 SBA 7(a) loans receivable, subject to secured borrowings 24,162 24,607 29,524 29,976 3 Other loans receivable 1,356 1,297 2,593 2,550 3 Liabilities: Mortgages payable (1) 414,672 417,912 530,793 516,892 3 Junior subordinated notes 25,093 25,490 25,055 25,173 3 _______________________________________________________________________________ (1) The June 30, 2017 carrying amount and estimated fair value of mortgages payable excludes two mortgage loans that have been classified as liabilities associated with assets held for sale on our consolidated balance sheet at June 30, 2017 (Notes 3 and 8). |
RELATED-PARTY TRANSACTIONS (Tab
RELATED-PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Related Party Transactions [Abstract] | |
Asset Management Fees Calculation | CIM Urban pays asset management fees to the Advisor on a quarterly basis in arrears. The fee is calculated as a percentage of the daily average adjusted fair value of CIM Urban's investments, as defined, as follows: Daily Average Adjusted Fair Quarterly Fee From Greater of To and Including (in thousands) $ — $ 500,000 0.2500% 500,000 1,000,000 0.2375% 1,000,000 1,500,000 0.2250% 1,500,000 4,000,000 0.2125% 4,000,000 20,000,000 0.1000% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Scheduled Future Noncancelable Minimum Lease Payments | Scheduled future noncancelable minimum lease payments at June 30, 2017 are as follows: Years Ending December 31, (in thousands) 2017 (Six months ending December 31, 2017) $ 375 2018 607 2019 503 2020 541 2021 578 Thereafter 127,101 $ 129,705 |
FUTURE MINIMUM LEASE RENTALS (T
FUTURE MINIMUM LEASE RENTALS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Leases, Operating [Abstract] | |
Future Minimum Rental Revenue Under Long-Term Operating Leases | Future minimum rental revenue under long-term operating leases at June 30, 2017 , excluding tenant reimbursements of certain costs, are as follows: Years Ending December 31, Governmental Other Total (in thousands) 2017 (Six months ending December 31, 2017) $ 23,641 $ 42,985 $ 66,626 2018 47,795 84,583 132,378 2019 50,079 76,353 126,432 2020 48,002 67,531 115,533 2021 36,307 56,511 92,818 Thereafter 122,999 168,790 291,789 $ 328,823 $ 496,753 $ 825,576 _______________________________________________________________________________ (1) Excludes future minimum rental revenue of 7083 Hollywood Boulevard, which is classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). |
CONCENTRATIONS (Tables)
CONCENTRATIONS (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Risks and Uncertainties [Abstract] | |
Concentration Risks From Properties | Our revenue concentrations from properties are as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 California 61.1 % 65.1 % 62.2 % 64.9 % Washington, D.C. 23.7 20.6 22.2 20.9 Texas 8.0 8.1 7.9 8.0 North Carolina 4.9 4.2 5.6 4.2 New York 2.3 2.0 2.1 2.0 100.0 % 100.0 % 100.0 % 100.0 % Our real estate investments concentrations from properties are as follows: June 30, 2017 December 31, 2016 California (1) 50.2 % 50.8 % Washington, D.C. 39.9 32.3 Texas (1) 5.2 7.7 New York (1) 4.7 3.7 North Carolina — 5.5 100.0 % 100.0 % _______________________________________________________________________________ (1) Includes the assets of 7083 Hollywood Boulevard, 4200 Scotland Street, and 47 E 34th Street, all of which are classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). |
SEGMENT DISCLOSURE (Tables)
SEGMENT DISCLOSURE (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Segment Reporting [Abstract] | |
Segment Net Operating Income Included in Continuing Operations | The net operating income of our segments included in continuing operations for the three and six months ended June 30, 2017 and 2016 is as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands) Office: Revenues $ 43,914 $ 45,770 $ 93,007 $ 91,819 Property expenses: Operating 17,804 19,930 31,557 38,417 General and administrative 394 91 682 445 Total property expenses 18,198 20,021 32,239 38,862 Segment net operating income—office 25,716 25,749 60,768 52,957 Hotel: Revenues 10,604 14,496 21,122 29,779 Property expenses: Operating 6,586 9,431 13,025 19,386 General and administrative 35 306 39 393 Total property expenses 6,621 9,737 13,064 19,779 Segment net operating income—hotel 3,983 4,759 8,058 10,000 Multifamily: Revenues 4,714 5,172 9,717 10,230 Property expenses: Operating 2,859 2,938 5,627 5,774 General and administrative 113 97 342 355 Total property expenses 2,972 3,035 5,969 6,129 Segment net operating income—multifamily 1,742 2,137 3,748 4,101 Lending: Revenues 2,067 2,922 4,402 5,149 Lending expenses: Interest expense (55 ) (7 ) 87 182 Fees to related party 784 884 1,628 1,814 General and administrative 310 419 677 598 Total lending expenses 1,039 1,296 2,392 2,594 Segment net operating income—lending 1,028 1,626 2,010 2,555 Total segment net operating income $ 32,469 $ 34,271 $ 74,584 $ 69,613 |
Reconciliation of Segment Net Operating Income to Net Income Attributable to the Company | A reconciliation of our segment net operating income to net income attributable to the Company for the three and six months ended June 30, 2017 and 2016 is as follows: Three Months Ended June 30, Six Months Ended June 30, 2017 2016 2017 2016 (in thousands) Total segment net operating income $ 32,469 $ 34,271 $ 74,584 $ 69,613 Asset management and other fees to related parties (7,079 ) (7,492 ) (14,935 ) (15,193 ) Interest expense (9,568 ) (7,302 ) (19,199 ) (13,928 ) General and administrative (795 ) (1,218 ) (1,586 ) (2,282 ) Transaction costs (11,615 ) (118 ) (11,628 ) (267 ) Depreciation and amortization (14,761 ) (18,480 ) (31,992 ) (36,538 ) Impairment of real estate (13,100 ) — (13,100 ) — Gain on sale of real estate 116,283 — 304,017 24,739 Income (loss) from continuing operations before provision for income taxes 91,834 (339 ) 286,161 26,144 Provision for income taxes (462 ) (471 ) (854 ) (661 ) Net income (loss) from continuing operations 91,372 (810 ) 285,307 25,483 Discontinued operations: Income from operations of assets held for sale — 1,668 — 2,358 Net income from discontinued operations — 1,668 — 2,358 Net income 91,372 858 285,307 27,841 Net income attributable to noncontrolling interests (9 ) (9 ) (14 ) (12 ) Net income attributable to the Company $ 91,363 $ 849 $ 285,293 $ 27,829 |
Segment Condensed Assets | The condensed assets for each of the segments as of June 30, 2017 and December 31, 2016 , along with capital expenditures and loan originations for the six months ended June 30, 2017 and 2016 , are as follows: June 30, 2017 December 31, 2016 (in thousands) Condensed assets: Office (1) $ 1,235,540 $ 1,568,702 Hotel 110,655 115,955 Multifamily (2) 107,412 170,159 Lending assets 86,307 91,191 Non-segment assets 98,041 76,877 Total assets $ 1,637,955 $ 2,022,884 |
Segment Capital Expenditures | Six Months Ended June 30, 2017 2016 (in thousands) Capital expenditures (3): Office $ 11,973 $ 18,839 Hotel 74 336 Multifamily 224 241 Total capital expenditures 12,271 19,416 Loan originations 23,875 49,976 Total capital expenditures and loan originations (4) $ 36,146 $ 69,392 _______________________________________________________________________________ (1) Includes the assets of 7083 Hollywood Boulevard, which are classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). (2) Includes the assets of 4200 Scotland Street and 47 E 34th Street, both of which are classified as held for sale on our consolidated balance sheet at June 30, 2017 (Note 3). (3) Represents additions and improvements to real estate investments, excluding acquisitions. (4) Includes the activity for dispositions through their respective disposition dates. |
ORGANIZATION AND OPERATIONS (De
ORGANIZATION AND OPERATIONS (Details) - $ / shares | Jun. 30, 2017 | Dec. 31, 2016 |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Common stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Common stock, shares authorized (in shares) | 900,000,000 | 900,000,000 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
BASIS OF PRESENTATION AND SUM47
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Investments in Real Estate (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Investments in Real Estate | ||||
Impairment of long-lived assets | $ 13,100,000 | $ 0 | $ 13,100,000 | $ 0 |
Buildings and improvements | Minimum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 15 years | |||
Buildings and improvements | Maximum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 40 years | |||
Furniture, fixtures, and equipment | Minimum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 3 years | |||
Furniture, fixtures, and equipment | Maximum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 5 years |
BASIS OF PRESENTATION AND SUM48
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Loans Receivable (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2015 | Mar. 11, 2014 | |
Loans receivable | ||||||
Net impairment (recovery) | $ 0 | $ 7 | $ 12 | $ (236) | ||
Commercial mortgage loans | ||||||
Loans receivable | ||||||
Unamortized acquisition discounts related to sold loans | $ 15,951 | |||||
PMC Commercial | ||||||
Loans receivable | ||||||
Discount on acquisition | $ 33,907 | |||||
Acquisition discount | $ 1,563 | $ 1,563 |
BASIS OF PRESENTATION AND SUM49
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Deferred Rent Receivable and Charges (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Deferred Rent Receivable and Charges | ||
Deferred rent receivable | $ 56,406 | $ 64,010 |
Deferred leasing costs | 60,116 | 76,063 |
Deferred leasing costs, accumulated amortization | 25,338 | 25,914 |
Deferred offering costs | 2,771 | 2,060 |
Other deferred costs | $ 1,414 | $ 135 |
BASIS OF PRESENTATION AND SUM50
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Redeemable Preferred Stock (Details) | 6 Months Ended |
Jun. 30, 2017 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Preferred stock, percentage of stated value | 100.00% |
Preferred stock redemption, trading days prior to redemption | 20 days |
ACQUISITIONS AND DISPOSITIONS -
ACQUISITIONS AND DISPOSITIONS - Disposals (Details) | Jun. 23, 2017USD ($)apartment | Jun. 20, 2017USD ($)ft² | Jun. 08, 2017USD ($)ft² | May 30, 2017USD ($)apartment | Mar. 28, 2017USD ($)ft² | Feb. 02, 2016USD ($)room | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2017USD ($)agreementbusiness | Jun. 30, 2016USD ($)business | Dec. 31, 2016USD ($) |
Disposals | ||||||||||||
Number of business acquisitions | business | 0 | 0 | ||||||||||
Disposed Property Information | ||||||||||||
Sales price | $ 642,886,000 | $ 42,782,000 | ||||||||||
Gain on sale of real estate | $ 116,283,000 | $ 0 | 304,017,000 | 24,739,000 | ||||||||
Assets | ||||||||||||
Total assets | 125,138,000 | 125,138,000 | $ 0 | |||||||||
Liabilities | ||||||||||||
Total liabilities | 52,886,000 | 52,886,000 | $ 0 | |||||||||
Additional Information | ||||||||||||
Impairment of real estate | 13,100,000 | $ 0 | 13,100,000 | $ 0 | ||||||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Assets | ||||||||||||
Investments in real estate, net | 319,078,000 | 319,078,000 | ||||||||||
Deferred rent receivable and charges, net | 22,089,000 | 22,089,000 | ||||||||||
Other intangible assets, net | 129,000 | 129,000 | ||||||||||
Other assets | 38,000 | 38,000 | ||||||||||
Total assets | 341,334,000 | 341,334,000 | ||||||||||
Liabilities | ||||||||||||
Debt, net | 64,777,000 | 64,777,000 | ||||||||||
Intangible liabilities, net | 1,800,000 | 1,800,000 | ||||||||||
Total liabilities | 66,577,000 | 66,577,000 | ||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | ||||||||||||
Assets | ||||||||||||
Investments in real estate, net | 118,221,000 | 118,221,000 | ||||||||||
Cash and cash equivalents | 2,904,000 | 2,904,000 | ||||||||||
Restricted cash | 51,000 | 51,000 | ||||||||||
Accounts receivable, net | 251,000 | 251,000 | ||||||||||
Deferred rent receivable and charges, net | 1,865,000 | 1,865,000 | ||||||||||
Other intangible assets, net | 1,124,000 | 1,124,000 | ||||||||||
Other assets | 722,000 | 722,000 | ||||||||||
Total assets | 125,138,000 | 125,138,000 | ||||||||||
Liabilities | ||||||||||||
Debt, net | 50,230,000 | 50,230,000 | ||||||||||
Accounts payable and accrued expenses | 1,402,000 | 1,402,000 | ||||||||||
Due to related parties | 195,000 | 195,000 | ||||||||||
Other liabilities | 1,059,000 | 1,059,000 | ||||||||||
Total liabilities | 52,886,000 | 52,886,000 | ||||||||||
Additional Information | ||||||||||||
Investments in real estate, gross | 136,153,000 | 136,153,000 | ||||||||||
Investments in real estate, accumulated depreciation | 17,932,000 | 17,932,000 | ||||||||||
Deferred loan costs | 524,000 | 524,000 | ||||||||||
Deferred loan costs, accumulated amortization | 186,000 | 186,000 | ||||||||||
211 Main Street, San Francisco | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposals | ||||||||||||
Ownership sold, percentage | 100.00% | |||||||||||
Sale transaction costs | $ 2,943,000 | |||||||||||
Mortgage prepayment penalty | $ 1,508,000 | |||||||||||
Disposed Property Information | ||||||||||||
Square feet | ft² | 417,266 | |||||||||||
Sales price | $ 292,882,000 | |||||||||||
Gain on sale of real estate | 187,734,000 | |||||||||||
Additional Information | ||||||||||||
Premium on assumed mortgage | 665,000 | $ 665,000 | ||||||||||
Payment of mortgages payable | $ 25,331,000 | |||||||||||
3636 McKinney Avenue and 3839 McKinney Avenue, Dallas, Texas | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposals | ||||||||||||
Ownership sold, percentage | 100.00% | |||||||||||
Sale transaction costs | $ 2,258,000 | |||||||||||
Mortgage prepayment penalty | 1,901,000 | |||||||||||
Additional Information | ||||||||||||
Payment of mortgages payable | $ 15,448,000 | |||||||||||
3636 McKinney Avenue, Dallas, Texas | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposed Property Information | ||||||||||||
Number of units | apartment | 103 | |||||||||||
Sales price | $ 20,000,000 | |||||||||||
Gain on sale of real estate | $ 5,488,000 | |||||||||||
3839 McKinney Avenue, Dallas, Texas | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposed Property Information | ||||||||||||
Number of units | apartment | 75 | |||||||||||
Sales price | $ 14,100,000 | |||||||||||
Gain on sale of real estate | $ 4,224,000 | |||||||||||
200 S College Street, Charlotte, North Carolina | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposals | ||||||||||||
Ownership sold, percentage | 100.00% | |||||||||||
Sale transaction costs | $ 833,000 | |||||||||||
Disposed Property Information | ||||||||||||
Square feet | ft² | 567,865 | |||||||||||
Sales price | $ 148,500,000 | |||||||||||
Gain on sale of real estate | $ 45,906,000 | |||||||||||
980 9th Street and 1010 8th Street, Sacramento, California | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposals | ||||||||||||
Ownership sold, percentage | 100.00% | |||||||||||
Sale transaction costs | $ 952,000 | |||||||||||
Disposed Property Information | ||||||||||||
Square feet | ft² | 485,926 | |||||||||||
Sales price | $ 120,500,000 | |||||||||||
Gain on sale of real estate | $ 34,829,000 | |||||||||||
4649 Cole Avenue, Dallas, Texas | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposals | ||||||||||||
Ownership sold, percentage | 100.00% | |||||||||||
Sale transaction costs | $ 3,311,000 | |||||||||||
Mortgage prepayment penalty | $ 2,812,000 | |||||||||||
Disposed Property Information | ||||||||||||
Number of units | apartment | 334 | |||||||||||
Sales price | $ 64,000,000 | |||||||||||
Gain on sale of real estate | 25,836,000 | |||||||||||
Additional Information | ||||||||||||
Payment of mortgages payable | $ 23,333,000 | |||||||||||
Courtyard Oakland located in Oakland California | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||
Disposals | ||||||||||||
Ownership sold, percentage | 100.00% | |||||||||||
Disposed Property Information | ||||||||||||
Number of rooms | room | 162 | |||||||||||
Sales price | $ 43,800,000 | |||||||||||
Gain on sale of real estate | $ 24,739,000 | |||||||||||
7083 Hollywood Boulevard, 4200 Scotland Street, 47 E 34th Street | ||||||||||||
Additional Information | ||||||||||||
Number of purchase and sales agreements entered into | agreement | 3 | |||||||||||
47 E 34th Street | Disposal Group, Held-for-sale, Not Discontinued Operations | ||||||||||||
Additional Information | ||||||||||||
Other intangible assets, gross | 4,273,000 | $ 4,273,000 | ||||||||||
Other intangible assets, accumulated amortization | 3,149,000 | 3,149,000 | ||||||||||
7083 Hollywood Boulevard | Disposal Group, Held-for-sale, Not Discontinued Operations | ||||||||||||
Additional Information | ||||||||||||
Debt, gross | 21,700,000 | 21,700,000 | ||||||||||
4200 Scotland Street | Disposal Group, Held-for-sale, Not Discontinued Operations | ||||||||||||
Additional Information | ||||||||||||
Debt, gross | 28,868,000 | $ 28,868,000 | ||||||||||
370 L'Enfant Promenade, Washington D.C. | ||||||||||||
Additional Information | ||||||||||||
Impairment of real estate | $ 13,100,000 | |||||||||||
Scenario, Forecast | ||||||||||||
Additional Information | ||||||||||||
Payment of mortgages payable | $ 50,568,000 | |||||||||||
Scenario, Forecast | 7083 Hollywood Boulevard, 4200 Scotland Street, 47 E 34th Street | ||||||||||||
Disposed Property Information | ||||||||||||
Sales price | $ 186,325,000 |
INVESTMENTS IN REAL ESTATE (Det
INVESTMENTS IN REAL ESTATE (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Real Estate [Abstract] | |||||
Land | $ 244,072 | $ 244,072 | $ 343,564 | ||
Land improvements | 17,746 | 17,746 | 26,177 | ||
Buildings and improvements | 1,064,191 | 1,064,191 | 1,475,415 | ||
Furniture, fixtures, and equipment | 3,525 | 3,525 | 4,955 | ||
Tenant improvements | 130,481 | 130,481 | 159,677 | ||
Work in progress | 9,528 | 9,528 | 11,706 | ||
Investments in real estate | 1,469,543 | 1,469,543 | 2,021,494 | ||
Accumulated depreciation | (328,083) | (328,083) | (414,552) | ||
Net investments in real estate | 1,141,460 | 1,141,460 | $ 1,606,942 | ||
Depreciation expense | $ 12,670 | $ 16,030 | $ 27,354 | $ 31,703 |
OTHER INTANGIBLE ASSETS (Detail
OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 |
Intangible assets | ||||||
Net | $ 15,610 | $ 17,623 | $ 15,610 | $ 15,610 | ||
Intangible liabilities | ||||||
Net | (1,138) | (3,576) | (1,138) | (1,138) | ||
Future amortization of acquisition related intangible assets | ||||||
Net | 15,610 | 17,623 | 15,610 | 15,610 | ||
Future accretion of acquisition related intangible liabilities | ||||||
Net | (1,138) | (3,576) | (1,138) | (1,138) | ||
Acquired Below-Market Leases | ||||||
Intangible liabilities | ||||||
Gross balance | (5,722) | (18,893) | (5,722) | (5,722) | ||
Accumulated amortization | 4,584 | 15,317 | 4,584 | 4,584 | ||
Net | $ (1,138) | $ (3,576) | (1,138) | (1,138) | ||
Average useful life (in years) | 7 years | 8 years | ||||
Future accretion of acquisition related intangible liabilities | ||||||
2017 (Six months ending December 31, 2017) | $ (428) | (428) | (428) | |||
2,018 | (510) | (510) | (510) | |||
2,019 | (200) | (200) | (200) | |||
2,020 | 0 | 0 | 0 | |||
2,021 | 0 | 0 | 0 | |||
Thereafter | 0 | 0 | 0 | |||
Net | (1,138) | $ (3,576) | (1,138) | (1,138) | ||
Acquired Above-Market Leases | ||||||
Intangible assets | ||||||
Gross balance | 215 | |||||
Accumulated amortization | (180) | |||||
Net | $ 35 | |||||
Average useful life (in years) | 8 years | |||||
Amortization | ||||||
Amortization of acquired above-market and below-market leases | 0 | $ (26) | (3) | $ (64) | ||
Future amortization of acquisition related intangible assets | ||||||
Net | $ 35 | |||||
Acquired In-Place Leases | ||||||
Intangible assets | ||||||
Gross balance | 10,181 | 11,551 | 10,181 | 10,181 | ||
Accumulated amortization | (7,581) | (8,443) | (7,581) | (7,581) | ||
Net | $ 2,600 | $ 3,108 | 2,600 | 2,600 | ||
Average useful life (in years) | 10 years | 10 years | ||||
Amortization | ||||||
Amortization expense | 195 | 368 | 411 | 748 | ||
Future amortization of acquisition related intangible assets | ||||||
2017 (Six months ending December 31, 2017) | $ 373 | 373 | 373 | |||
2,018 | 723 | 723 | 723 | |||
2,019 | 464 | 464 | 464 | |||
2,020 | 207 | 207 | 207 | |||
2,021 | 207 | 207 | 207 | |||
Thereafter | 626 | 626 | 626 | |||
Net | 2,600 | $ 3,108 | 2,600 | 2,600 | ||
Tax Abatement | ||||||
Intangible assets | ||||||
Gross balance | 4,273 | |||||
Accumulated amortization | (2,873) | |||||
Net | $ 1,400 | |||||
Average useful life (in years) | 8 years | |||||
Amortization | ||||||
Amortization expense | 138 | 138 | 276 | 276 | ||
Future amortization of acquisition related intangible assets | ||||||
Net | $ 1,400 | |||||
Acquired Below-Market Ground Lease | ||||||
Intangible assets | ||||||
Gross balance | 11,685 | 11,685 | 11,685 | 11,685 | ||
Accumulated amortization | (1,632) | (1,562) | (1,632) | (1,632) | ||
Net | $ 10,053 | $ 10,123 | 10,053 | 10,053 | ||
Average useful life (in years) | 84 years | 84 years | ||||
Future amortization of acquisition related intangible assets | ||||||
2017 (Six months ending December 31, 2017) | $ 70 | 70 | 70 | |||
2,018 | 140 | 140 | 140 | |||
2,019 | 140 | 140 | 140 | |||
2,020 | 140 | 140 | 140 | |||
2,021 | 140 | 140 | 140 | |||
Thereafter | 9,423 | 9,423 | 9,423 | |||
Net | 10,053 | $ 10,123 | 10,053 | 10,053 | ||
Trade Name and License | ||||||
Intangible assets | ||||||
Gross balance | 2,957 | 2,957 | 2,957 | 2,957 | ||
Accumulated amortization | 0 | 0 | 0 | 0 | ||
Net | 2,957 | 2,957 | 2,957 | 2,957 | ||
Future amortization of acquisition related intangible assets | ||||||
Net | $ 2,957 | $ 2,957 | 2,957 | 2,957 | ||
Franchise Affiliation Fee | ||||||
Amortization | ||||||
Amortization expense | 0 | 0 | 0 | 33 | ||
Rental and Other Property Operating Expenses | Acquired Below-Market Leases | ||||||
Amortization | ||||||
Amortization of acquired above-market and below-market leases | 35 | 35 | 70 | 70 | ||
Rental and Other Property Income | Acquired Below-Market Leases | ||||||
Amortization | ||||||
Amortization of acquired above-market and below-market leases | $ 219 | $ 631 | $ 638 | $ 1,262 |
OTHER ASSETS (Details)
OTHER ASSETS (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Other Assets [Abstract] | ||
SBA 7(a) loans, subject to credit risk | $ 46,276 | $ 43,623 |
SBA 7(a) loans, subject to secured borrowings | 24,162 | 29,524 |
Other assets | 18,717 | 19,123 |
Total other assets | $ 89,155 | $ 92,270 |
Financing Receivable, Recorded Investment [Line Items] | ||
Loans, percent current | 99.50% | 99.70% |
SBA 7(a) loans | Hospitality Industry | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Concentration risk, percent | 95.90% | 94.60% |
Substandard | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans, classified in substandard categories | $ 593 | $ 804 |
Financing Receivables, Greater Than 29 Days Past Due | ||
Financing Receivable, Recorded Investment [Line Items] | ||
Loans, greater than 29 days delinquent | $ 236 | $ 249 |
DISCONTINUED OPERATIONS - Narra
DISCONTINUED OPERATIONS - Narrative (Details) - USD ($) $ in Thousands | Dec. 17, 2015 | Jun. 30, 2016 | Jun. 30, 2016 | Dec. 29, 2016 |
Lending | Discontinued Operations, Held-for-sale or Disposed of by Sale | ||||
DISCONTINUED OPERATIONS | ||||
Transaction costs | $ 11 | $ 20 | ||
Lending Segment, Commercial Mortgage Loans | Sold | ||||
DISCONTINUED OPERATIONS | ||||
Carrying value of disposal group | $ 77,121 | |||
Gain on disposition of assets held for sale | $ 5,151 | |||
Commercial Real Estate Subsidiary | Sold | ||||
DISCONTINUED OPERATIONS | ||||
Carrying value of disposal group | $ 27,587 |
DISCONTINUED OPERATIONS - Reven
DISCONTINUED OPERATIONS - Revenue and Expenses (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Expenses: | ||||
Income from operations of assets held for sale | $ 0 | $ 1,668 | $ 0 | $ 2,358 |
Held for sale | ||||
DISCONTINUED OPERATIONS | ||||
Revenue—Interest and other income | 2,416 | 3,531 | ||
Expenses: | ||||
Interest expense | 588 | 876 | ||
Fees to related party | 148 | 280 | ||
General and administrative | 12 | 17 | ||
Total expenses | 748 | 1,173 | ||
Income from operations of assets held for sale | $ 1,668 | $ 2,358 |
DEBT - Schedule (Details)
DEBT - Schedule (Details) - USD ($) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Debt | ||
Total Debt | $ 846,833,000 | $ 967,886,000 |
Mortgages Payable | ||
Debt | ||
Gross debt | 416,300,000 | 532,437,000 |
Deferred loan costs | (1,628,000) | (2,366,000) |
Premiums and discounts | 0 | 722,000 |
Total Debt | 414,672,000 | 530,793,000 |
Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | ||
Debt | ||
Gross debt | $ 370,300,000 | 392,000,000 |
Fixed interest rate | 4.14% | |
Amount of balance due on maturity | $ 370,300,000 | |
Mortgage loan with a fixed interest of 4.50% per annum, due on January 5, 2027 | ||
Debt | ||
Gross debt | $ 46,000,000 | 46,000,000 |
Fixed interest rate | 4.50% | |
Period of amortization schedule | 10 years | |
Amount of balance due on maturity | $ 42,008,000 | |
Mortgage loan with a fixed interest of 5.39% per annum, due on March 1, 2021 | ||
Debt | ||
Gross debt | 0 | $ 39,134,000 |
Fixed interest rate | 5.39% | |
Amount of balance due on maturity | $ 35,695,000 | |
Mortgage loan with a fixed interest of 5.18% per annum, due on June 5, 2021 | ||
Debt | ||
Gross debt | 0 | $ 29,167,000 |
Fixed interest rate | 5.18% | |
Amount of balance due on maturity | $ 26,232,000 | |
Mortgage loan with a fixed interest of 6.65% per annum, due on July 15, 2018 | ||
Debt | ||
Gross debt | 0 | $ 26,136,000 |
Fixed interest rate | 6.65% | |
Period of amortization schedule | 25 years | |
Amount of balance due on maturity | $ 21,136,000 | |
Secured Borrowings - Government Guaranteed Loans | ||
Debt | ||
Gross debt | 22,964,000 | 27,899,000 |
Premiums and discounts | 1,638,000 | 2,077,000 |
Total Debt | 24,602,000 | 29,976,000 |
Secured borrowing principal on SBA 7(a) loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 4.55% and 4.13% at June 30, 2017 and December 31, 2016, respectively. | ||
Debt | ||
Gross debt | $ 18,504,000 | $ 23,122,000 |
Weighted average rate | 4.55% | 4.13% |
Secured borrowing principal on SBA 7(a) loans sold for excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 2.33% and 1.83% at June 30, 2017 and December 31, 2016, respectively. | ||
Debt | ||
Gross debt | $ 4,460,000 | $ 4,777,000 |
Weighted average rate | 2.33% | 1.83% |
Other Debt | ||
Debt | ||
Gross debt | $ 412,070,000 | $ 412,070,000 |
Total Debt | 407,559,000 | 407,117,000 |
Unsecured term loan facility | ||
Debt | ||
Gross debt | 385,000,000 | 385,000,000 |
Junior subordinated notes | ||
Debt | ||
Gross debt | 27,070,000 | 27,070,000 |
Premiums and discounts | $ (1,977,000) | (2,015,000) |
Junior subordinated notes | LIBOR | ||
Debt | ||
Interest rate margin | 3.25% | |
Unsecured credit facilities | ||
Debt | ||
Gross debt | $ 0 | 0 |
Unsecured term loan and credit facilities | ||
Debt | ||
Deferred loan costs | $ (2,534,000) | $ (2,938,000) |
Disposal Group, Held-for-sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | ||
Debt | ||
Fixed interest rate | 4.14% | |
Debt, gross | $ 21,700,000 | |
Disposal Group, Held-for-sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 5.18% per annum, due on June 5, 2021 | ||
Debt | ||
Fixed interest rate | 5.18% |
DEBT - Narrative (Detail)
DEBT - Narrative (Detail) | Aug. 03, 2017USD ($)swap | Jun. 23, 2017USD ($) | May 30, 2017USD ($) | Mar. 28, 2017USD ($) | Jun. 30, 2016USD ($)agreement | May 31, 2015USD ($) | Sep. 30, 2014USD ($)extension_option | Jul. 31, 2017USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2016USD ($) | Nov. 02, 2015USD ($) |
Debt | |||||||||||
Deferred loan costs, gross | $ 5,835,000 | $ 7,122,000 | |||||||||
Deferred loan costs, accumulated amortization | 1,673,000 | 1,818,000 | |||||||||
Accrued interest and unused commitment fee payable | 2,765,000 | 3,133,000 | |||||||||
Unsecured credit facility entered into in September 2014 | |||||||||||
Debt | |||||||||||
Maximum borrowing capacity | $ 850,000,000 | ||||||||||
Number of extension options | extension_option | 2 | ||||||||||
Line of credit facility extension option term | 1 year | ||||||||||
Amount available for future borrowings | 89,000,000 | 200,000,000 | |||||||||
Unsecured credit facility entered into in September 2014, revolver | |||||||||||
Debt | |||||||||||
Maximum borrowing capacity | $ 450,000,000 | 200,000,000 | |||||||||
Unsecured credit facility entered into in September 2014, revolver | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin | 0.20% | ||||||||||
Unused commitment fee | 0.15% | ||||||||||
Unsecured credit facility entered into in September 2014, revolver | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin | 1.00% | ||||||||||
Unused commitment fee | 0.25% | ||||||||||
Unsecured credit facility entered into in September 2014, revolver | LIBOR | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin | 1.20% | ||||||||||
Unsecured credit facility entered into in September 2014, revolver | LIBOR | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin | 2.00% | ||||||||||
Unsecured credit facility entered into in September 2014, term loan | |||||||||||
Debt | |||||||||||
Maximum borrowing capacity | $ 325,000,000 | ||||||||||
Unsecured credit facility entered into in September 2014, term loan | LIBOR | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin | 1.15% | ||||||||||
Unsecured credit facility entered into in September 2014, term loan | LIBOR | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin | 1.95% | ||||||||||
Unsecured credit facility entered into in September 2014, term loan | Base rate | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin | 0.15% | ||||||||||
Unsecured credit facility entered into in September 2014, term loan | Base rate | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin | 0.95% | ||||||||||
Unsecured credit facility entered into in September 2014, delayed-draw term loan | |||||||||||
Debt | |||||||||||
Maximum borrowing capacity | $ 75,000,000 | ||||||||||
Unused commitment fee | 0.25% | ||||||||||
Unsecured credit facilities | |||||||||||
Debt | |||||||||||
Gross debt | 0 | 0 | |||||||||
Mortgages Payable | |||||||||||
Debt | |||||||||||
Gross debt | $ 416,300,000 | $ 532,437,000 | |||||||||
Number of mortgage loan agreements entered into | agreement | 6 | ||||||||||
Amount of loan | $ 392,000,000 | ||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | |||||||||||
Debt | |||||||||||
Maximum borrowing capacity | $ 385,000,000 | ||||||||||
Unused commitment fee | 0.20% | ||||||||||
Amount of loan | $ 385,000,000 | ||||||||||
Prepayment fee | 2.00% | ||||||||||
Interest rate | 2.65% | 2.22% | |||||||||
Fixed interest rate | 3.16% | ||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | LIBOR | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin | 1.60% | ||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | LIBOR | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin | 2.25% | ||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | Base rate | Minimum | |||||||||||
Debt | |||||||||||
Interest rate margin | 0.60% | ||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | Base rate | Maximum | |||||||||||
Debt | |||||||||||
Interest rate margin | 1.25% | ||||||||||
Unsecured term loan facility | |||||||||||
Debt | |||||||||||
Gross debt | $ 385,000,000 | $ 385,000,000 | |||||||||
Mortgage loan with a fixed interest of 6.65% per annum, due on July 15, 2018 | |||||||||||
Debt | |||||||||||
Gross debt | 0 | $ 26,136,000 | |||||||||
Fixed interest rate | 6.65% | ||||||||||
Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | |||||||||||
Debt | |||||||||||
Gross debt | $ 370,300,000 | $ 392,000,000 | |||||||||
Fixed interest rate | 4.14% | ||||||||||
Mortgage loan with a fixed interest of 5.18% per annum, due on June 5, 2021 | |||||||||||
Debt | |||||||||||
Gross debt | $ 0 | $ 29,167,000 | |||||||||
Fixed interest rate | 5.18% | ||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | |||||||||||
Debt | |||||||||||
Debt, gross | $ 21,700,000 | ||||||||||
Fixed interest rate | 4.14% | ||||||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 5.18% per annum, due on June 5, 2021 | |||||||||||
Debt | |||||||||||
Fixed interest rate | 5.18% | ||||||||||
211 Main Street, San Francisco | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||||||
Debt | |||||||||||
Payment of mortgages payable | $ 25,331,000 | ||||||||||
Mortgage prepayment penalty | $ 1,508,000 | ||||||||||
3636 McKinney Avenue and 3839 McKinney Avenue, Dallas, Texas | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||||||
Debt | |||||||||||
Payment of mortgages payable | $ 15,448,000 | ||||||||||
Mortgage prepayment penalty | $ 1,901,000 | ||||||||||
4649 Cole Avenue, Dallas, Texas | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||||||
Debt | |||||||||||
Payment of mortgages payable | $ 23,333,000 | ||||||||||
Mortgage prepayment penalty | $ 2,812,000 | ||||||||||
7083 Hollywood Boulevard | Disposal Group, Held-for-sale, Not Discontinued Operations | |||||||||||
Debt | |||||||||||
Debt, gross | $ 21,700,000 | ||||||||||
4200 Scotland Street | Disposal Group, Held-for-sale, Not Discontinued Operations | |||||||||||
Debt | |||||||||||
Debt, gross | $ 28,868,000 | ||||||||||
Subsequent Event | |||||||||||
Debt | |||||||||||
Number of swaps terminated | swap | 3 | ||||||||||
Notional amount of terminated swaps | $ 65,000,000 | ||||||||||
Payment of derivative fees and accrued interest | 38,000 | ||||||||||
Subsequent Event | Unsecured credit facility entered into in September 2014 | |||||||||||
Debt | |||||||||||
Extension fee | $ 300,000 | ||||||||||
Subsequent Event | Unsecured Term Loan Facility Entered Into May 2015 | |||||||||||
Debt | |||||||||||
Repayments of debt | $ 65,000,000 |
DEBT - Schedule of Future Princ
DEBT - Schedule of Future Principal Payments (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Future Principal Payments on Debt | |
2017 (Six months ending December 31, 2017) | $ 605 |
2,018 | 835 |
2,019 | 867 |
2,020 | 902 |
2,021 | 940 |
Thereafter | 847,185 |
Total Debt | 851,334 |
Secured Borrowings | |
Future Principal Payments on Debt | |
2017 (Six months ending December 31, 2017) | 605 |
2,018 | 835 |
2,019 | 867 |
2,020 | 902 |
2,021 | 940 |
Thereafter | 18,815 |
Total Debt | 22,964 |
Mortgages Payable | |
Future Principal Payments on Debt | |
2017 (Six months ending December 31, 2017) | 0 |
2,018 | 0 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
Thereafter | 416,300 |
Total Debt | 416,300 |
Other Debt | |
Future Principal Payments on Debt | |
2017 (Six months ending December 31, 2017) | 0 |
2,018 | 0 |
2,019 | 0 |
2,020 | 0 |
2,021 | 0 |
Thereafter | 412,070 |
Total Debt | $ 412,070 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Details) - Restricted share awards $ in Thousands | Mar. 06, 2015shares | May 06, 2014officershares | Jun. 30, 2017USD ($)shares | May 31, 2016shares | Apr. 30, 2015shares | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Mar. 06, 2015 |
Share-based compensation plans | ||||||||||
Unrecognized compensation expense | $ | $ 137 | $ 137 | $ 137 | |||||||
Independent Directors | ||||||||||
Share-based compensation plans | ||||||||||
Granted to each individual (in shares) | shares | 3,195 | 3,392 | 2,000 | |||||||
Granted (in shares) | shares | 9,585 | 10,176 | 6,000 | |||||||
Award vesting period | 1 year | 1 year | 1 year | |||||||
Stock-based compensation expense | $ | 29 | $ 32 | 77 | $ 59 | ||||||
Executive Officers | ||||||||||
Share-based compensation plans | ||||||||||
Granted (in shares) | shares | 2,000 | 2,000 | ||||||||
Award vesting period | 2 years | |||||||||
Stock-based compensation expense | $ | $ 0 | $ 1 | $ 1 | $ 6 | ||||||
Number of executive officers | officer | 2 | |||||||||
Requisite service period | 2 years | |||||||||
Executive Officers | Immediate | ||||||||||
Share-based compensation plans | ||||||||||
Award vesting rights, percentage | 33.33% | |||||||||
Executive Officers | Vesting Within First Year | ||||||||||
Share-based compensation plans | ||||||||||
Award vesting rights, percentage | 33.33% | |||||||||
Executive Officers | Vesting Within Second Year | ||||||||||
Share-based compensation plans | ||||||||||
Award vesting rights, percentage | 33.33% |
EARNINGS PER SHARE (''EPS'') (D
EARNINGS PER SHARE (''EPS'') (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 12, 2017 | Mar. 08, 2017 | Dec. 31, 2016 | |
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||||
Basic (in shares) | 78,871,000 | 96,683,000 | 81,445,000 | 97,173,000 | |||
Dilutive securities outstanding (in shares) | 0 | 0 | 0 | 0 | |||
Warrants outstanding (in shares) | 308,775 | 0 | 308,775 | 0 | |||
Numerator: | |||||||
Net income (loss) from continuing operations | $ 91,372 | $ (810) | $ 285,307 | $ 25,483 | |||
Net income attributable to noncontrolling interests | (9) | (9) | (14) | (12) | |||
Redeemable preferred stock dividends | (72) | 0 | (103) | 0 | |||
Numerator for basic and diluted net income (loss) from continuing operations available to common stockholders | 91,291 | (819) | 285,190 | 25,471 | |||
Net income from discontinued operations | 0 | 1,668 | 0 | 2,358 | |||
NET INCOME AVAILABLE TO COMMON STOCKHOLDERS | $ 91,291 | $ 849 | $ 285,190 | $ 27,829 | |||
Denominator: | |||||||
Basic weighted average shares outstanding (in shares) | 78,871,000 | 96,683,000 | 81,445,000 | 97,173,000 | |||
Effect of dilutive securities—contingently issuable shares and stock options (in shares) | 0 | 0 | 0 | 0 | |||
Diluted weighted average shares and common stock equivalents outstanding (in shares) | 78,871,000 | 96,683,000 | 81,445,000 | 97,173,000 | |||
Basic and diluted net income (loss) available to common stockholders per share: | |||||||
Continuing operations (in usd per share) | $ 1.16 | $ (0.01) | $ 3.50 | $ 0.26 | |||
Discontinued operations (in usd per share) | 0 | 0.02 | 0 | 0.02 | |||
Net income (in usd per share) | $ 1.16 | $ 0.01 | $ 3.50 | $ 0.29 | |||
Series A Preferred Stock | |||||||
Earnings Per Share, Basic, by Common Class, Including Two Class Method [Line Items] | |||||||
Series A Preferred Stock outstanding (in shares) | 308,775 | 0 | 308,775 | 0 | 308,775 | 144,698 | 61,435 |
REDEEMABLE PREFERRED STOCK - Na
REDEEMABLE PREFERRED STOCK - Narrative (Details) - USD ($) | Jul. 01, 2016 | Jun. 30, 2017 | Jun. 30, 2017 | Dec. 31, 2016 |
Class of Stock [Line Items] | ||||
Preferred stock redemption, trading days prior to redemption | 20 days | |||
Units issued (in shares) | 308,775 | 308,775 | ||
Proceeds from issuance of preferred stock and warrants | $ 7,720,000 | |||
Costs specifically identifiable to the offering | 614,000 | |||
Non issuance specific costs | 2,795,000 | |||
Deferred rent receivable reclassified to temporary equity | 24,000 | |||
Deferred rent receivable reclassified to stockholders' equity | $ 0 | |||
Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Redeemable preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 | $ 0.001 | |
Preferred stock, stated value (in usd per share) | $ 25 | $ 25 | $ 25 | |
Preferred stock redemption, trading days prior to redemption | 20 days | |||
Number of shares redeemed | 0 | |||
Proceeds from issuance of preferred stock | $ 7,668,000 | |||
Costs specifically identifiable to the offering | 594,000 | |||
Cumulative dividend rate | 5.50% | |||
Dividend per share per quarter (in usd per share) | $ 0.34375 | |||
Warrant | ||||
Class of Stock [Line Items] | ||||
Net proceeds from issuance of warrants | 52,000 | |||
Costs specifically identifiable to the offering | $ 20,000 | |||
Registration Statement | ||||
Class of Stock [Line Items] | ||||
Maximum amount of offering | $ 900,000,000 | |||
Warrant right to purchase a share of Common Stock (in shares) | 0.25 | |||
Maximum number of units in offering (in shares) | 36,000,000 | |||
Registration Statement | Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Redeemable preferred stock, par value (in usd per share) | $ 0.001 | |||
Preferred stock, stated value (in usd per share) | $ 25 | |||
Preferred Stock, Redemption Period, Year Two | Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Preferred stock, redemption fee | 13.00% | |||
Preferred Stock, Redemption Period, After Year Two, Before Year Five | Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Preferred stock, redemption fee | 10.00% | |||
Preferred Stock, Redemption Period, After Year Five | Series A Preferred Stock | ||||
Class of Stock [Line Items] | ||||
Preferred stock, redemption fee | 0.00% |
REDEEMABLE PREFERRED STOCK - Di
REDEEMABLE PREFERRED STOCK - Dividends Declared (Details) - USD ($) $ in Thousands | Jun. 12, 2017 | Mar. 08, 2017 | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 |
Class of Stock [Line Items] | |||||
Aggregate dividends declared | $ 103 | ||||
Series A Preferred Stock | |||||
Class of Stock [Line Items] | |||||
Series A Preferred Stock outstanding (in shares) | 308,775 | 144,698 | 308,775 | 61,435 | 0 |
Aggregate dividends declared | $ 72 | $ 31 |
STOCKHOLDERS' EQUITY - Dividend
STOCKHOLDERS' EQUITY - Dividends (Details) - USD ($) $ / shares in Units, $ in Thousands | Jun. 27, 2017 | Jun. 12, 2017 | Apr. 24, 2017 | Apr. 05, 2017 | Mar. 08, 2017 | Jun. 10, 2016 | Mar. 08, 2016 | Jun. 30, 2017 | Jun. 30, 2016 |
Dividends Payable [Line Items] | |||||||||
Payments of special dividends | $ 4,872 | $ 0 | |||||||
Common Stock | |||||||||
Dividends Payable [Line Items] | |||||||||
Dividends per common share (in usd per share) | $ 0.125 | $ 0.21875 | $ 0.21875 | $ 0.21875 | |||||
Common Stock, Excluding Private Repurchase Participants | |||||||||
Dividends Payable [Line Items] | |||||||||
Dividends per common share (in usd per share) | $ 1.98 | $ 0.28 | |||||||
Payments of special dividends | $ 4,271 | $ 601 |
STOCKHOLDERS' EQUITY - Share Re
STOCKHOLDERS' EQUITY - Share Repurchases (Details) - USD ($) | Jun. 12, 2017 | Sep. 14, 2016 | May 16, 2016 | Jun. 30, 2017 | Jun. 30, 2016 |
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchased and retired | $ 576,000,000 | $ 210,332,000 | |||
June 2017 Share Repurchase | Common Stock | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchased and retired (in shares) | 26,181,818 | ||||
Stock repurchased and retired | $ 576,000,000 | ||||
Stock repurchased and retired (in usd per share) | $ 22 | ||||
September 2016 Share Repurchase | Common Stock | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchased and retired (in shares) | 3,628,116 | ||||
Stock repurchased and retired | $ 79,819,000 | ||||
Stock repurchased and retired (in usd per share) | $ 22 | ||||
Cash Tender Offer | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchase program, fees and expenses | $ 301,000 | ||||
Cash Tender Offer | Common Stock | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchased and retired (in shares) | 10,000,000 | ||||
Stock repurchased and retired | $ 210,000,000 | ||||
Stock repurchased and retired (in usd per share) | $ 21 | ||||
Number of shares authorized to be repurchased | 10,000,000 | ||||
Percentage of stock repurchased | 10.24% | ||||
Urban Partners II, LLC | Cash Tender Offer | Common Stock | |||||
Equity, Class of Treasury Stock [Line Items] | |||||
Stock repurchased and retired | $ 208,140,000 |
STOCKHOLDERS' EQUITY - Warrants
STOCKHOLDERS' EQUITY - Warrants (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jul. 01, 2016 | |
Registration statement | ||||
Warrants issued (in shares) | 308,775 | 0 | 308,775 | |
Net proceeds from issuance of warrants | $ 27 | $ 0 | $ 32 | |
Registration Statement | ||||
Registration statement | ||||
Warrant right to purchase a share of Common Stock (in shares) | 0.25 | |||
Premium of the exercise price of the warrant as a percent to net asset value of common stock | 15.00% |
DERIVATIVE FINANCIAL INSTRUME67
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Interest Rate Swap (Details) | Jun. 30, 2017 | Dec. 31, 2016 | Nov. 02, 2015USD ($)swap |
Unsecured Term Loan Facility Entered Into May 2015 | |||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||
Amount of borrowings covered by the interest rate swap | $ 385,000,000 | ||
Designated as Hedging Instrument | Interest Rate Swap | Cash Flow Hedges | |||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||
Number of interest rate swaps | swap | 10 | ||
Total notional amount | $ 385,000,000 | ||
Designated as Hedging Instrument | Interest Rate Swap | Minimum | Cash Flow Hedges | |||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||
Fixed rates | 1.559% | ||
Designated as Hedging Instrument | Interest Rate Swap | Maximum | Cash Flow Hedges | |||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||
Fixed rates | 1.569% | ||
Designated as Hedging Instrument | Interest Rate Swap | Weighted Average | Cash Flow Hedges | |||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||
Fixed rates | 1.563% | ||
Credit spread rate | 1.60% | 1.60% | |
All-in rate | 3.16% |
DERIVATIVE FINANCIAL INSTRUME68
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - AOCI (Details) | Aug. 03, 2017USD ($)swap | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | $ 966,589,000 | $ 1,297,347,000 | |||
Ending balance | $ 646,481,000 | $ 1,063,971,000 | 646,481,000 | 1,063,971,000 | |
Amount of derivatives reclassified out of AOCI | 1,108,000 | ||||
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Beginning balance | 1,043,000 | (10,444,000) | (509,000) | (2,519,000) | |
Other comprehensive income (loss) before reclassifications | (983,000) | (3,535,000) | (189,000) | (12,568,000) | |
Amounts reclassified from accumulated other comprehensive income (loss) | 543,000 | 1,090,000 | 1,301,000 | 2,198,000 | |
Net current period other comprehensive income (loss) | (440,000) | (2,445,000) | 1,112,000 | (10,370,000) | |
Ending balance | 603,000 | $ (12,889,000) | 603,000 | $ (12,889,000) | |
Subsequent Event | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Number of swaps terminated | swap | 3 | ||||
Notional amount of terminated swaps | $ 65,000,000 | ||||
Payment of derivative fees and accrued interest | 38,000 | ||||
Swaps Terminated in July 2017 | Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Ending balance | $ 101,000 | $ 101,000 | |||
Unsecured Term Loan Facility Entered Into May 2015 | Subsequent Event | |||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||
Repayments of debt | $ 65,000,000 |
FAIR VALUE OF FINANCIAL INSTR69
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair Value of Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Other Assets (Other Liabilities) | Fair Value, Measurements, Recurring | Interest rate swap | Level 2 | ||
Fair value of financial instruments | ||
Derivative assets (liabilities) | $ 603 | $ (509) |
FAIR VALUE OF FINANCIAL INSTR70
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair Value of Financial Instruments Not Recorded at Fair Value (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Carrying Amount | ||
Liabilities: | ||
Mortgages payable | $ 414,672 | $ 530,793 |
Junior subordinated notes | 25,093 | 25,055 |
Carrying Amount | Loans receivable subject to credit risk | ||
Assets: | ||
Loans receivable | 46,276 | 43,623 |
Carrying Amount | SBA 7(a) loans receivable, subject to secured borrowings | ||
Assets: | ||
Loans receivable | 24,162 | 29,524 |
Carrying Amount | Other loans receivable | ||
Assets: | ||
Loans receivable | 1,356 | 2,593 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | ||
Liabilities: | ||
Mortgages payable | 417,912 | 516,892 |
Junior subordinated notes | 25,490 | 25,173 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | Loans receivable subject to credit risk | ||
Assets: | ||
Loans receivable | 46,176 | 43,621 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | SBA 7(a) loans receivable, subject to secured borrowings | ||
Assets: | ||
Loans receivable | 24,607 | 29,976 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | Other loans receivable | ||
Assets: | ||
Loans receivable | $ 1,297 | $ 2,550 |
FAIR VALUE OF FINANCIAL INSTR71
FAIR VALUE OF FINANCIAL INSTRUMENTS - Unobservable Inputs (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2017 | Dec. 31, 2016 | |
Mortgages Payable | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value inputs, discount rate | 4.11% | 4.60% |
Mortgages Payable | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value inputs, discount rate | 4.26% | 4.72% |
Junior Subordinated Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value inputs, discount rate | 5.05% | 4.83% |
Loans Receivable Subject to Credit Risk | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value inputs, discount rate | 8.75% | 8.25% |
Fair value inputs, prepayment rates | 5.80% | 5.80% |
Loans Receivable Subject to Credit Risk | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value inputs, discount rate | 13.75% | 13.25% |
Fair value inputs, prepayment rates | 20.00% | 20.00% |
SBA 7(a) Loans Receivable, Subject to Secured Borrowings | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value inputs, prepayment rates | 6.70% | 6.70% |
SBA 7(a) Loans Receivable, Subject to Secured Borrowings | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value inputs, prepayment rates | 20.00% | 20.00% |
RELATED-PARTY TRANSACTIONS (Det
RELATED-PARTY TRANSACTIONS (Details) - USD ($) | Jun. 12, 2017 | May 16, 2016 | Oct. 01, 2015 | Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | Mar. 11, 2014 |
Related-party transactions | |||||||||
Due to related parties | $ 10,005,000 | $ 10,005,000 | $ 10,196,000 | ||||||
Stock repurchased and retired | $ 576,000,000 | $ 210,332,000 | |||||||
CIM Urban REIT Management, L.P. | 0 - 500,000,000 | |||||||||
Related-party transactions | |||||||||
Quarterly fee percentage | 0.25% | 0.25% | |||||||
CIM Urban REIT Management, L.P. | 0 - 500,000,000 | Minimum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 0 | $ 0 | |||||||
CIM Urban REIT Management, L.P. | 0 - 500,000,000 | Maximum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 500,000,000 | $ 500,000,000 | |||||||
CIM Urban REIT Management, L.P. | 500,000,000 - 1,000,000,000 | |||||||||
Related-party transactions | |||||||||
Quarterly fee percentage | 0.2375% | 0.2375% | |||||||
CIM Urban REIT Management, L.P. | 500,000,000 - 1,000,000,000 | Minimum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 500,000,000 | $ 500,000,000 | |||||||
CIM Urban REIT Management, L.P. | 500,000,000 - 1,000,000,000 | Maximum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 1,000,000,000 | $ 1,000,000,000 | |||||||
CIM Urban REIT Management, L.P. | 1,000,000,000 - 1,500,000,000 | |||||||||
Related-party transactions | |||||||||
Quarterly fee percentage | 0.225% | 0.225% | |||||||
CIM Urban REIT Management, L.P. | 1,000,000,000 - 1,500,000,000 | Minimum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 1,000,000,000 | $ 1,000,000,000 | |||||||
CIM Urban REIT Management, L.P. | 1,000,000,000 - 1,500,000,000 | Maximum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 1,500,000,000 | $ 1,500,000,000 | |||||||
CIM Urban REIT Management, L.P. | 1,500,000,000 - 4,000,000,000 | |||||||||
Related-party transactions | |||||||||
Quarterly fee percentage | 0.2125% | 0.2125% | |||||||
CIM Urban REIT Management, L.P. | 1,500,000,000 - 4,000,000,000 | Minimum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 1,500,000,000 | $ 1,500,000,000 | |||||||
CIM Urban REIT Management, L.P. | 1,500,000,000 - 4,000,000,000 | Maximum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 4,000,000,000 | $ 4,000,000,000 | |||||||
CIM Urban REIT Management, L.P. | 4,000,000,000 - 20,000,000,000 | |||||||||
Related-party transactions | |||||||||
Quarterly fee percentage | 0.10% | 0.10% | |||||||
CIM Urban REIT Management, L.P. | 4,000,000,000 - 20,000,000,000 | Minimum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | $ 4,000,000,000 | $ 4,000,000,000 | |||||||
CIM Urban REIT Management, L.P. | 4,000,000,000 - 20,000,000,000 | Maximum | |||||||||
Related-party transactions | |||||||||
Daily average adjusted fair value of investments | 20,000,000,000 | 20,000,000,000 | |||||||
CIM Urban REIT Management, L.P. | Asset Management Fees | |||||||||
Related-party transactions | |||||||||
Fees | 6,130,000 | $ 6,238,000 | 12,544,000 | 12,716,000 | |||||
Due to related parties | 6,107,000 | 6,107,000 | 6,448,000 | ||||||
CIM Urban REIT Management, L.P. | Property Management Fees | |||||||||
Related-party transactions | |||||||||
Fees | 1,306,000 | 1,405,000 | 2,738,000 | 2,815,000 | |||||
CIM Management Entities | |||||||||
Related-party transactions | |||||||||
Due to related parties | 2,450,000 | 2,450,000 | 2,027,000 | ||||||
CIM Management Entities | Personnel Fees | |||||||||
Related-party transactions | |||||||||
Fees | 2,556,000 | 2,245,000 | 4,686,000 | 4,007,000 | |||||
CIM Management Entities | Lease Commission Fees | |||||||||
Related-party transactions | |||||||||
Fees | 210,000 | 688,000 | 371,000 | 754,000 | |||||
CIM Management Entities | Construction Management Fees | |||||||||
Related-party transactions | |||||||||
Fees | 91,000 | 410,000 | 275,000 | 668,000 | |||||
CIM Management Entities And Related Parties | |||||||||
Related-party transactions | |||||||||
Due from related parties | 591,000 | 591,000 | 214,000 | ||||||
CIM Service Provider, LLC | Base Service Fee | |||||||||
Related-party transactions | |||||||||
Fees | 265,000 | 271,000 | 530,000 | 525,000 | |||||
Fees payable per year under agreement | $ 1,000,000 | ||||||||
CIM Service Provider, LLC | Master Services Agreement | |||||||||
Related-party transactions | |||||||||
Due to related parties | 2,234,000 | 2,234,000 | $ 1,935,000 | ||||||
Compensation expensed for performing other services | 560,000 | 860,000 | 1,622,000 | 1,726,000 | |||||
CIM SBA Staffing, LLC | Personnel Fees | |||||||||
Related-party transactions | |||||||||
Personnel expenses | 0 | 148,000 | 0 | 280,000 | |||||
Deferred personnel costs | 110,000 | 70,000 | 154,000 | 149,000 | |||||
CIM SBA Staffing, LLC | Expenses Related to Lending Segment Subject to Reimbursement | |||||||||
Related-party transactions | |||||||||
Fees | 784,000 | 884,000 | 1,628,000 | 1,814,000 | |||||
CIM SBA Staffing, LLC | Expenses Related to Corporate Services Subject to Reimbursement | |||||||||
Related-party transactions | |||||||||
Fees | 124,000 | 123,000 | 239,000 | 226,000 | |||||
CIM Management Entities Affiliate | |||||||||
Related-party transactions | |||||||||
Lease renewal term | 5 years | ||||||||
Rental and other property income | $ 27,000 | $ 27,000 | $ 54,000 | $ 54,000 | |||||
Cash Tender Offer | |||||||||
Related-party transactions | |||||||||
Stock repurchase program, fees and expenses | $ 301,000 | ||||||||
Common Stock | Cash Tender Offer | |||||||||
Related-party transactions | |||||||||
Stock repurchased and retired (in shares) | 10,000,000 | ||||||||
Stock repurchased and retired (in usd per share) | $ 21 | ||||||||
Stock repurchased and retired | $ 210,000,000 | ||||||||
Common Stock | June 2017 Share Repurchase | |||||||||
Related-party transactions | |||||||||
Stock repurchased and retired (in shares) | 26,181,818 | ||||||||
Stock repurchased and retired (in usd per share) | $ 22 | ||||||||
Stock repurchased and retired | $ 576,000,000 |
COMMITMENTS AND CONTINGENCIES73
COMMITMENTS AND CONTINGENCIES (Details) | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||
Jan. 31, 2016shares | Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)officer | Jun. 30, 2016USD ($) | Dec. 31, 2016USD ($) | Dec. 31, 2015USD ($) | |
Commitments and contingencies | |||||||
Outstanding loan commitments to fund loans | $ 25,877,000 | $ 25,877,000 | |||||
Future obligations under leases to fund tenant improvements and other future construction obligation | 29,971,000 | 29,971,000 | |||||
Restricted cash | 26,706,000 | 26,706,000 | $ 32,160,000 | ||||
Future noncancelable minimum lease payments | |||||||
2017 (Six months ending December 31, 2017) | 375,000 | 375,000 | |||||
2,018 | 607,000 | 607,000 | |||||
2,019 | 503,000 | 503,000 | |||||
2,020 | 541,000 | 541,000 | |||||
2,021 | 578,000 | 578,000 | |||||
Thereafter | 127,101,000 | 127,101,000 | |||||
Total | 129,705,000 | 129,705,000 | |||||
Ground Lease, Property One | |||||||
Commitments and contingencies | |||||||
Current annual rent | $ 503,000 | ||||||
Period after which the annual rental payment will be increased | 5 years | ||||||
Percentage increase in annual rental payment after every 5 years, option one | 15.00% | ||||||
Percentage increase in annual rental payment after every 5 years, percentage of CPI, option two | 50.00% | ||||||
Annual increase in rent payable on commencement dates | 10.00% | ||||||
Rent expense | 438,000 | $ 438,000 | $ 876,000 | $ 876,000 | |||
Straight line rent liability | 13,843,000 | 13,843,000 | $ 13,289,000 | ||||
Office Space in Dallas, Texas | |||||||
Commitments and contingencies | |||||||
Rent expense | $ 56,000 | 56,000 | $ 112,000 | 114,000 | |||
Employment agreements | Executive Officers | |||||||
Commitments and contingencies | |||||||
Number of officers covered under employment agreement | officer | 2 | ||||||
Multiplier used for the calculation of payments in the event of death of employee | 2 | 2 | |||||
Multiplier used for the calculation of payments in the event of disability to employee | 1 | 1 | |||||
Employment agreements | Executive Officers | 2015 Equity Incentive Plan | |||||||
Commitments and contingencies | |||||||
Shares of common stock issued under incentive plan (in shares) | shares | 76,423 | ||||||
Accrued payroll taxes | $ 444,000 | ||||||
Stock-based compensation expense | $ 0 | $ 0 | $ 0 | $ 0 | |||
Unrecognized compensation expense | 0 | 0 | |||||
Restricted Cash for Tenant Improvements | |||||||
Commitments and contingencies | |||||||
Restricted cash | 12,648,000 | 12,648,000 | |||||
City and County of San Francisco Real Property Transfer Tax Case | Pending Litigation | |||||||
Commitments and contingencies | |||||||
Loss contingency accrual | $ 11,592,000 | $ 11,592,000 |
FUTURE MINIMUM LEASE RENTALS (D
FUTURE MINIMUM LEASE RENTALS (Details) $ in Thousands | Jun. 30, 2017USD ($) |
Future minimum lease rentals | |
2017 (Six months ending December 31, 2017) | $ 66,626 |
2,018 | 132,378 |
2,019 | 126,432 |
2,020 | 115,533 |
2,021 | 92,818 |
Thereafter | 291,789 |
Total | 825,576 |
Governmental Tenants | |
Future minimum lease rentals | |
2017 (Six months ending December 31, 2017) | 23,641 |
2,018 | 47,795 |
2,019 | 50,079 |
2,020 | 48,002 |
2,021 | 36,307 |
Thereafter | 122,999 |
Total | 328,823 |
Other Tenants | |
Future minimum lease rentals | |
2017 (Six months ending December 31, 2017) | 42,985 |
2,018 | 84,583 |
2,019 | 76,353 |
2,020 | 67,531 |
2,021 | 56,511 |
Thereafter | 168,790 |
Total | $ 496,753 |
CONCENTRATIONS (Details)
CONCENTRATIONS (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2017USD ($)stateproperty | Jun. 30, 2016 | Jun. 30, 2017USD ($)stateproperty | Jun. 30, 2016 | Dec. 31, 2016USD ($)stateproperty | |
Concentrations | |||||
Number of states in which properties are owned | state | 3 | 3 | 4 | ||
Office properties | |||||
Concentrations | |||||
Number of real estate properties owned | 17 | 17 | 20 | ||
Multifamily properties | |||||
Concentrations | |||||
Number of real estate properties owned | 2 | 2 | 5 | ||
Hotel properties | |||||
Concentrations | |||||
Number of real estate properties owned | 1 | 1 | 1 | ||
Parking garages | |||||
Concentrations | |||||
Number of real estate properties owned | 2 | 2 | 3 | ||
Development site | |||||
Concentrations | |||||
Number of real estate properties owned | 2 | 2 | 2 | ||
Parking lot | |||||
Concentrations | |||||
Number of real estate properties owned | 1 | 1 | 1 | ||
Revenues | Tenant Revenue Concentrations | Governmental Tenants | |||||
Concentrations | |||||
Concentration risk, percent | 21.40% | 19.00% | 20.40% | 19.50% | |
Amount due from Governmental Tenants | $ | $ 11,946 | $ 11,946 | $ 8,339 | ||
Revenues | Geographical concentrations | |||||
Concentrations | |||||
Concentration risk, percent | 100.00% | 100.00% | 100.00% | 100.00% | |
Revenues | Geographical concentrations | California | |||||
Concentrations | |||||
Concentration risk, percent | 61.10% | 65.10% | 62.20% | 64.90% | |
Revenues | Geographical concentrations | Washington, D.C. | |||||
Concentrations | |||||
Concentration risk, percent | 23.70% | 20.60% | 22.20% | 20.90% | |
Revenues | Geographical concentrations | Texas | |||||
Concentrations | |||||
Concentration risk, percent | 8.00% | 8.10% | 7.90% | 8.00% | |
Revenues | Geographical concentrations | North Carolina | |||||
Concentrations | |||||
Concentration risk, percent | 4.90% | 4.20% | 5.60% | 4.20% | |
Revenues | Geographical concentrations | New York | |||||
Concentrations | |||||
Concentration risk, percent | 2.30% | 2.00% | 2.10% | 2.00% | |
Real Estate Investments | Geographical concentrations | |||||
Concentrations | |||||
Concentration risk, percent | 100.00% | 100.00% | |||
Real Estate Investments | Geographical concentrations | California | |||||
Concentrations | |||||
Concentration risk, percent | 50.20% | 50.80% | |||
Real Estate Investments | Geographical concentrations | Washington, D.C. | |||||
Concentrations | |||||
Concentration risk, percent | 39.90% | 32.30% | |||
Real Estate Investments | Geographical concentrations | Texas | |||||
Concentrations | |||||
Concentration risk, percent | 5.20% | 7.70% | |||
Real Estate Investments | Geographical concentrations | North Carolina | |||||
Concentrations | |||||
Concentration risk, percent | 0.00% | 5.50% | |||
Real Estate Investments | Geographical concentrations | New York | |||||
Concentrations | |||||
Concentration risk, percent | 4.70% | 3.70% |
SEGMENT DISCLOSURE - Operating
SEGMENT DISCLOSURE - Operating Income (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017USD ($) | Jun. 30, 2016USD ($) | Jun. 30, 2017USD ($)property | Jun. 30, 2016USD ($) | |
Segment Reporting [Abstract] | ||||
Number of types of commercial real estate properties | property | 3 | |||
Segment disclosure | ||||
Revenues | $ 61,299 | $ 68,360 | $ 128,248 | $ 136,977 |
Expenses: | ||||
Interest expense | 9,513 | 7,295 | 19,286 | 14,110 |
General and administrative | 1,647 | 2,131 | 3,326 | 4,073 |
EXPENSES | 85,748 | 68,699 | 146,104 | 135,572 |
Total segment net operating income | 91,834 | (339) | 286,161 | 26,144 |
Reportable segments | ||||
Expenses: | ||||
Total segment net operating income | 32,469 | 34,271 | 74,584 | 69,613 |
Reportable segments | Office | ||||
Segment disclosure | ||||
Revenues | 43,914 | 45,770 | 93,007 | 91,819 |
Expenses: | ||||
Operating | 17,804 | 19,930 | 31,557 | 38,417 |
General and administrative | 394 | 91 | 682 | 445 |
EXPENSES | 18,198 | 20,021 | 32,239 | 38,862 |
Total segment net operating income | 25,716 | 25,749 | 60,768 | 52,957 |
Reportable segments | Hotel | ||||
Segment disclosure | ||||
Revenues | 10,604 | 14,496 | 21,122 | 29,779 |
Expenses: | ||||
Operating | 6,586 | 9,431 | 13,025 | 19,386 |
General and administrative | 35 | 306 | 39 | 393 |
EXPENSES | 6,621 | 9,737 | 13,064 | 19,779 |
Total segment net operating income | 3,983 | 4,759 | 8,058 | 10,000 |
Reportable segments | Multi-family | ||||
Segment disclosure | ||||
Revenues | 4,714 | 5,172 | 9,717 | 10,230 |
Expenses: | ||||
Operating | 2,859 | 2,938 | 5,627 | 5,774 |
General and administrative | 113 | 97 | 342 | 355 |
EXPENSES | 2,972 | 3,035 | 5,969 | 6,129 |
Total segment net operating income | 1,742 | 2,137 | 3,748 | 4,101 |
Reportable segments | Lending | ||||
Segment disclosure | ||||
Revenues | 2,067 | 2,922 | 4,402 | 5,149 |
Expenses: | ||||
Interest expense | (55) | (7) | 87 | 182 |
Fees to related party | 784 | 884 | 1,628 | 1,814 |
General and administrative | 310 | 419 | 677 | 598 |
EXPENSES | 1,039 | 1,296 | 2,392 | 2,594 |
Total segment net operating income | $ 1,028 | $ 1,626 | $ 2,010 | $ 2,555 |
SEGMENT DISCLOSURE - Reconcilia
SEGMENT DISCLOSURE - Reconciliation Of Segment Operating Income (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Segment disclosure | ||||
Asset management and other fees to related parties | $ (7,863,000) | $ (8,376,000) | $ (16,563,000) | $ (17,007,000) |
Interest expense | (9,513,000) | (7,295,000) | (19,286,000) | (14,110,000) |
General and administrative | (1,647,000) | (2,131,000) | (3,326,000) | (4,073,000) |
Transaction costs | (11,615,000) | (118,000) | (11,628,000) | (267,000) |
Depreciation and amortization | (14,761,000) | (18,480,000) | (31,992,000) | (36,538,000) |
Impairment of real estate | (13,100,000) | 0 | (13,100,000) | 0 |
Gain on sale of real estate | 116,283,000 | 0 | 304,017,000 | 24,739,000 |
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES | 91,834,000 | (339,000) | 286,161,000 | 26,144,000 |
Provision for income taxes | (462,000) | (471,000) | (854,000) | (661,000) |
NET INCOME (LOSS) FROM CONTINUING OPERATIONS | 91,372,000 | (810,000) | 285,307,000 | 25,483,000 |
Discontinued Operations | ||||
Income from operations of assets held for sale | 0 | 1,668,000 | 0 | 2,358,000 |
NET INCOME FROM DISCONTINUED OPERATIONS | 0 | 1,668,000 | 0 | 2,358,000 |
NET INCOME | 91,372,000 | 858,000 | 285,307,000 | 27,841,000 |
Net income attributable to noncontrolling interests | (9,000) | (9,000) | (14,000) | (12,000) |
NET INCOME ATTRIBUTABLE TO THE COMPANY | 91,363,000 | 849,000 | 285,293,000 | 27,829,000 |
Reportable segments | ||||
Segment disclosure | ||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE PROVISION FOR INCOME TAXES | 32,469,000 | 34,271,000 | 74,584,000 | 69,613,000 |
Corporate and Reconciling Items | ||||
Segment disclosure | ||||
Asset management and other fees to related parties | (7,079,000) | (7,492,000) | (14,935,000) | (15,193,000) |
Interest expense | (9,568,000) | (7,302,000) | (19,199,000) | (13,928,000) |
General and administrative | (795,000) | (1,218,000) | (1,586,000) | (2,282,000) |
Transaction costs | (11,615,000) | (118,000) | (11,628,000) | (267,000) |
Depreciation and amortization | (14,761,000) | (18,480,000) | (31,992,000) | (36,538,000) |
Impairment of real estate | (13,100,000) | 0 | (13,100,000) | 0 |
Gain on sale of real estate | $ 116,283,000 | $ 0 | $ 304,017,000 | $ 24,739,000 |
SEGMENT DISCLOSURE - Assets and
SEGMENT DISCLOSURE - Assets and Capital Expenditures and Loan Originations (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Segment disclosure | |||
Total assets | $ 1,637,955 | $ 2,022,884 | |
Total capital expenditures | 12,271 | $ 19,416 | |
Loan originations | 23,875 | 49,976 | |
Total capital expenditures and loan originations (4) | 36,146 | 69,392 | |
Reportable segments | Office | |||
Segment disclosure | |||
Total assets | 1,235,540 | 1,568,702 | |
Total capital expenditures | 11,973 | 18,839 | |
Reportable segments | Hotel | |||
Segment disclosure | |||
Total assets | 110,655 | 115,955 | |
Total capital expenditures | 74 | 336 | |
Reportable segments | Multi-family | |||
Segment disclosure | |||
Total assets | 107,412 | 170,159 | |
Total capital expenditures | 224 | $ 241 | |
Reportable segments | Lending | |||
Segment disclosure | |||
Total assets | 86,307 | 91,191 | |
Non-segment | |||
Segment disclosure | |||
Total assets | $ 98,041 | $ 76,877 |