Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 12, 2016 | |
Document And Entity Information | ||
Entity Registrant Name | PILLARSTONE CAPITAL REIT | |
Entity Central Index Key | 928,953 | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Smaller Reporting Company | |
Entity Common Stock, Shares Outstanding | 405,169 | |
Trading Symbol | PRLE | |
Document Fiscal Period Focus | Q2 | |
Document Fiscal Year Focus | 2,016 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2016 | Dec. 31, 2015 |
Assets | ||
Cash | $ 93,111 | $ 174,283 |
Marketable securities | 100 | 100 |
Other assets | 7,137 | 9,952 |
Total Assets | 100,348 | 184,335 |
Liabilities | ||
Accounts payable and accrued expenses | 35,050 | 14,010 |
Convertible notes payable – related parties | 197,780 | 197,780 |
Accrued interest payable | 12,138 | 2,276 |
Total Liabilities | 244,968 | 214,066 |
Commitments and Contingencies | ||
Shareholders' Deficit | ||
Common Shares - $0.01 par value per share; 400,000,000 authorized: 443,299 shares issued and 405,169 outstanding as of June 30, 2016, 100,000,000 authorized: 443,226 shares issued and 405,096 outstanding as of December 31, 2015 | 4,052 | 4,051 |
Additional paid-in capital | 28,146,987 | 28,146,971 |
Accumulated deficit | (27,499,934) | (27,385,045) |
Treasury stock, at cost, 38,130 shares | (800,735) | (800,735) |
Total Shareholders' Deficit | (144,620) | (29,731) |
Total Liabilities and Shareholders' Deficit | 100,348 | 184,335 |
Redeemable Convertible Series A Preferred Stock [Member] | ||
Shareholders' Deficit | ||
Preferred stock | 2,566 | 2,583 |
Redeemable Convertible Series C Preferred Stock [Member] | ||
Shareholders' Deficit | ||
Preferred stock | $ 2,444 | $ 2,444 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
Common stock, par value | $ 0.01 | $ 0.01 |
Common stock, shares authorized | 400,000,000 | 100,000,000 |
Common stock, shares issued | 443,299 | 443,226 |
Common stock, shares outstanding | 405,169 | 405,096 |
Treasury stock, at cost, shares | 38,130 | 38,130 |
Redeemable Convertible Series A Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 1,518,000 | 10,000,000 |
Preferred stock, shares issued | 256,636 | 258,236 |
Preferred stock, shares outstanding | 256,636 | 258,236 |
Preferred stock, liquidation preference | $ 10 | $ 10 |
Redeemable Convertible Series C Preferred Stock [Member] | ||
Preferred stock, par value | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized | 300,000 | 300,000 |
Preferred stock, shares issued | 244,444 | 244,444 |
Preferred stock, shares outstanding | 244,444 | 244,444 |
Preferred stock, liquidation preference | $ 10 | $ 10 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Revenues | ||||
Interest/dividend income | ||||
Total revenues | ||||
Expenses | ||||
General and administrative | 69,927 | 10,687 | 105,027 | 30,729 |
Interest | 4,931 | 9,862 | ||
Total expenses | 74,858 | 10,687 | 114,889 | 30,729 |
Income (loss) from operations | (74,858) | (10,687) | (114,889) | (30,729) |
Net income (loss) attributable to common shareholders | $ (74,858) | $ (10,687) | $ (114,889) | $ (30,729) |
Net income (loss) attributable to common shareholders per Common Share: basic and diluted | $ (0.18) | $ (0.03) | $ (0.28) | $ (0.08) |
Weighted average number of Common Shares outstanding: basic and diluted | 405,115 | 405,096 | 405,106 | 405,096 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2015 | |
Cash flows from operating activities: | ||
Net income (loss) | $ (114,889) | $ (30,729) |
Net change in operating assets and liabilities: | ||
Other assets | 2,815 | 3,384 |
Accounts payable and accrued expenses | 30,902 | 26 |
Net cash from (used in) continuing operations | (81,172) | (27,319) |
Cash flows from investing activities: | ||
Cash used for the purchase of marketable securities | ||
Proceeds from the sale of marketable securities | 18,000 | |
Net cash from (used for) investing activities | 18,000 | |
Cash flows from financing activities: | ||
Net cash from (used for) financing activities Net cash provided by investing activities | ||
Net increase (decrease) in cash | (81,172) | (9,319) |
Cash | ||
Beginning of period | 174,283 | 10,726 |
End of period | $ 93,111 | $ 1,407 |
Organization
Organization | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization | Note 1 Organization In March 2016, shareholders of Paragon Real Estate Equity and Investment Trust approved changing the companys name to Pillarstone Capital REIT (the Company, Pillarstone Capital, we, our, or us). We are a shell company (as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as amended (the Exchange Act)) and a Maryland real estate investment trust (REIT). Pillarstone Capital is primarily focused on maintaining its trust existence and Securities and Exchange Commission (SEC) reporting history to enable it, in the future, to raise additional capital and make real estate investments. Future real estate investments may include acquisition and development of retail, office, office warehouse, industrial, multifamily, hotel, other commercial properties, acquisition of or merger with a REIT or real estate operating company and joint venture investments. Excess funds may be invested in marketable securities of other real estate companies depending on market conditions. |
Basis of Presentation
Basis of Presentation | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Note 2 Basis of Presentation Condensed Consolidated Financial Statement Presentation We have prepared the condensed consolidated financial statements without audit pursuant to the rules and regulations of the SEC. Certain information and footnote disclosures normally included in the financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations. However, we believe that the included disclosures are adequate to make the information presented not misleading. In our opinion, all adjustments (consisting solely of normal recurring items) necessary for a fair presentation of our financial position as of June 30, 2016, the results of our operations for the six month periods ended June 30, 2016 and 2015, the three month periods ended June 30, 2016 and 2015, and of our cash flows for the six month periods ended June 30, 2016 and 2015 have been included. The results of operations for interim periods are not necessarily indicative of the results for a full year. For further information, please see our consolidated financial statements and footnotes included in the Annual Report on Form 10-K for the year ended December 31, 2015. The Company presents its financial statements on a consolidated basis because it combines its accounts with a wholly-owned subsidiary that ceased operations in 2002. All significant intercompany transactions are eliminated in consolidation. Going Concern The financial statements have been prepared assuming the Company will continue as a going concern, which contemplates the continued operations as a public company and paying liabilities in the normal course of business. The Company is being maintained as a corporate shell that is current in its SEC filings. Management and the board of trustees are evaluating real estate opportunities to put into the Company. At June 30, 2016, our cash in the operating account was $93,111. In November 2015, we issued convertible notes payable for proceeds of $197,780, which have been and will continue to be used to pay expenses to keep the Company current in its SEC filings so that the Company may be used in the future for real estate transactions or sold to another company. Expenses, such as salaries and rent, have been eliminated. Our ability to continue as a going concern will be dependent upon acquiring assets to generate cash flow. There can be no assurance that the Company will be able to acquire an operating company, be acquired by or merge with another company, raise capital or otherwise continue to exist as a going concern. Even if our management is successful in closing a transaction, investors may not value the transaction in the same manner as we did, and investors may not value the transaction as they would value other transactions or alternatives. Failure to obtain external sources of capital and complete a transaction will materially and adversely affect the Companys ability to continue operations. |
Marketable Securities
Marketable Securities | 6 Months Ended |
Jun. 30, 2016 | |
Marketable Securities [Abstract] | |
Marketable Securities | Note 3 Marketable Securities As of June 30, 2016, our marketable securities had a fair market value of $100 and was in the form of cash in an insured deposit account at the brokerage firm. During the six month period ended June 30, 2016, there were no transfers to the operating account from the brokerage firm and there was no interest income earned in the account at the brokerage firm. During the six month period ended June 30, 2015, the Company transferred $18,000 to the operating account, which is shown as proceeds from the sale of marketable securities on the cash flow statement. |
Convertible Notes Payable - Rel
Convertible Notes Payable - Related Parties | 6 Months Ended |
Jun. 30, 2016 | |
Debt Disclosure [Abstract] | |
Convertible Notes Payable - Related Parties | Note 4 Convertible Notes Payable Related Parties On November 20, 2015, five trustees on our board of trustees loaned $197,780 to the Company in exchange for convertible notes payable. The convertible notes payable accrue interest at 10% per annum and mature on November 20, 2018. The convertible notes payable can be converted by the noteholders into common shares at the rate of $1.331 per common share at any time. The Company can convert the notes payable into common shares at any time. At maturity or when the Company chooses to convert the convertible notes payable into common shares, the noteholders have the option to receive cash plus accrued interest or convert the convertible notes payable into common shares. |
Loss Per Share
Loss Per Share | 6 Months Ended |
Jun. 30, 2016 | |
Earnings Per Share [Abstract] | |
Loss Per Share | Note 5 Loss Per Share Net loss per weighted average common share outstandingbasic and diluted are computed based on the weighted average number of common shares outstanding for the period. The weighted average number of common shares outstanding for the six month period ended June 30, 2016 was 405,106 and for the six month period ended June 30, 2015 was 405,096. The weighted average number of common shares outstanding for the three month period ended June 30, 2016 was 405,115 and for the three month period ended June 30, 2015 was 405,096. Common share equivalents of 2,606,528 as of the six month period ended June 30, 2016 include outstanding Class A Cumulative Convertible Preferred Shares (the Preferred Class A Shares), Class C Cumulative Convertible Preferred Shares (the Preferred Class C Shares), and convertible notes payable. Common share equivalents of 2,448,892 as of the six month period ended June 30, 2015 include outstanding Preferred Class A Shares and Preferred Class C Shares, The common share equivalents are not included in net loss per weighted average common share outstandingdiluted as they would be anti-dilutive. |
Shareholders' Equity (Deficit)
Shareholders' Equity (Deficit) | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
Shareholders' Equity (Deficit) | Note 6 Shareholders Equity (Deficit) Our common shareholders, Preferred Class A shareholders, and Preferred Class C shareholders approved changes to our declaration of trust, as amended and restated, in March 2016. We presently have authority to issue up to 450,000,000 shares of beneficial interest, $0.01 par value per share, of which 400,000,000 are classified as common shares of beneficial interest, $0.01 par value per share and 50,000,000 are classified as preferred shares of beneficial interest, $0.01 par value per share. Of the 50,000,000 preferred shares of beneficial interest, 1,518,000 shares are designated as Preferred Class A Shares and 300,000 shares are designated as Preferred Class C Shares. Previously, we had authority to issue up to 110,000,000 shares of beneficial interest, $0.01 par value per share, of which 100,000,000 were classified as common shares of beneficial interest, $0.01 par value per share, and 10,000,000 were classified as preferred shares of beneficial interest, $0.01 par value per share, with 1,518,000 shares designated as Preferred Class A Shares and 300,000 shares designated as Preferred Class C Shares. |
2016 Equity Plan
2016 Equity Plan | 6 Months Ended |
Jun. 30, 2016 | |
Equity [Abstract] | |
2016 Equity Plan | Note 7 2016 Equity Plan At our annual shareholders meeting held on March 23, 2016 (the 2016 Annual Meeting), our shareholders approved the 2016 Equity Plan (2016 Plan). The 2016 Plan provides that awards may be made in common shares of the Company or units in the Companys operating partnership, which may be converted into common shares. Subject to adjustment as provided by the terms of the 2016 Plan, the maximum aggregate number of common shares with respect to which awards may be granted under the 2016 Plan is 57,870, which will be increased based on future issuances of common shares and units of the operating partnership. The maximum aggregate number of common shares that may be issued under the 2016 Plan will be increased upon each issuance of common shares and units of the operating partnership by the Company (including issuances pursuant to the 2016 Plan) so that at any time the maximum number of shares that may be issued under the 2016 Plan shall equal 12.5% of the aggregate number of common shares and units of the operating partnership issued and outstanding (other than treasury shares and/or units issued to or held by the Company). The Management, Organization and Compensation Committee (the Committee) administers the 2016 Plan, except with respect to awards to non-employee trustees, for which the 2016 Plan will be administered by the board of trustees. Subject to the terms of the 2016 Plan, the Committee is authorized to select participants, determine the type and number of awards to be granted, determine and later amend (subject to certain limitations) the terms and conditions of any award, interpret and specify the rules and regulations relating to the 2016 Plan, and make all other determinations which may be necessary or desirable for the administration of the 2016 Plan. The 2016 Plan includes the types of awards for grants and the types of financial performance measures. As of June 30, 2016, no grants were issued under the 2016 Plan. |
Basis of Presentation (Details
Basis of Presentation (Details Narrative) - USD ($) | 1 Months Ended | ||||
Nov. 30, 2015 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2015 | Dec. 31, 2014 | |
Accounting Policies [Abstract] | |||||
Cash | $ 93,111 | $ 174,283 | $ 1,407 | $ 10,726 | |
Proceeds from issuance of convertible notes payable | $ 197,780 |
Marketable Securities (Details
Marketable Securities (Details Narrative) - USD ($) | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Dec. 31, 2015 | |
Marketable Securities [Abstract] | |||
Fair value of marketable securities of cash | $ 100 | $ 100 | |
Proceeds from sale of marketable securities | $ 18,000 |
Convertible Notes Payable - R15
Convertible Notes Payable - Related Parties (Details Narrative) - USD ($) | Nov. 20, 2015 | Jun. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | |||
Convertible notes payable - related parties | $ 197,780 | $ 197,780 | $ 197,780 |
Percentage of convertible notes payable accrue interest | 10.00% | ||
Convertible notes payable mature date | Nov. 20, 2018 | ||
Convertible notes payable converted by noteholder into common shares rate per share | $ 1.331 |
Loss Per Share (Details Narrati
Loss Per Share (Details Narrative) - shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2016 | Jun. 30, 2015 | Jun. 30, 2016 | Jun. 30, 2015 | |
Earnings Per Share [Abstract] | ||||
Weighted average number of common shares outstanding | 405,115 | 405,096 | 405,106 | 405,096 |
Common share equivalents excluded from EPS calculation due to anti-dilutive effect | 2,606,528 | 2,448,892 |
Shareholders' Equity (Deficit)
Shareholders' Equity (Deficit) (Details Narrative) | Jun. 30, 2016$ / sharesshares |
Class of Stock [Line Items] | |
Shares of beneficial interest | 450,000,000 |
Shares of beneficial interest par value per share | $ / shares | $ 0.01 |
Common stock of beneficial interest, shares | 400,000,000 |
Common stock beneficial interest par value per share | $ / shares | $ 0.01 |
Preferred stock of beneficial interest, shares | 50,000,000 |
Preferred stock beneficial interest par value per share | $ / shares | $ 0.01 |
Previously Reported [Member] | |
Class of Stock [Line Items] | |
Shares of beneficial interest | 110,000,000 |
Shares of beneficial interest par value per share | $ / shares | $ 0.01 |
Common stock of beneficial interest, shares | 100,000,000 |
Common stock beneficial interest par value per share | $ / shares | $ 0.01 |
Preferred stock of beneficial interest, shares | 10,000,000 |
Preferred stock beneficial interest par value per share | $ / shares | $ 0.01 |
Class A Convertible Preferred Shares [Member] | |
Class of Stock [Line Items] | |
Preferred stock, shares designated | 1,518,000 |
Class A Convertible Preferred Shares [Member] | Previously Reported [Member] | |
Class of Stock [Line Items] | |
Preferred stock, shares designated | 1,518,000 |
Class C Convertible Preferred Shares [Member] | |
Class of Stock [Line Items] | |
Preferred stock, shares designated | 300,000 |
Class C Convertible Preferred Shares [Member] | Previously Reported [Member] | |
Class of Stock [Line Items] | |
Preferred stock, shares designated | 300,000 |
2016 Equity Plan (Details Narra
2016 Equity Plan (Details Narrative) - 2016 Equity Plan [Member] | 6 Months Ended |
Jun. 30, 2016shares | |
Maximum number of common shares awards to be granted | 57,870 |
Percentage of aggregate number of common shares and units of operating partnership issued and outstanding | 12.50% |
Number of option granted during period |