(Mark One) | |
ý | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the fiscal year ended December 31, 2017 | |
OR | |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to |
Maryland (State or other jurisdiction of incorporation or organization) | 30-0971238 (I.R.S. Employer Identification Number) | |
1114 Avenue of the Americas, 39th Floor New York, NY (Address of principal executive offices) | 10036 (Zip code) |
Title of each class: | Name of Exchange on which registered: | |
Common Stock, $0.01 par value | New York Stock Exchange |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer ý (Do not check if a smaller reporting company) | Smaller reporting company o | Emerging growth company ý |
1. | Portions of the registrant's definitive proxy statement for the registrant's 2018 Annual Meeting, to be filed within 120 days after the close of the registrant's fiscal year, are incorporated by reference into Part III of this Annual Report on Form 10-K. |
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• | We will pay no management fee to our Manager through June 30, 2018, which covers the first year of our management agreement. Although we pay no management fee to our Manager through June 30, 2018, accounting principles generally accepted in the United States ("GAAP") requires us to record an expense and a non-cash capital contribution from iStar despite iStar not receiving any compensation for its services. |
• | Thereafter, our Manager will receive a fee equal to 1% of total equity (as defined in our management agreement), to be paid solely in shares of our common stock. |
• | The stock will be locked up for two years, subject to certain restrictions. |
• | There is no additional performance or incentive fee. |
• | Our management agreement has a term of one year with annual renewals to be approved by a majority of the independent members of our board of directors. |
• | The management agreement may generally be terminated by us or our Manager at the end of each annual term without the payment of a termination fee. |
• | We have an exclusivity agreement with iStar pursuant to which iStar agreed, subject to certain exceptions, that it will not acquire, originate, invest in, or provide financing for a third party’s acquisition of, a Ground Lease unless it has first offered that opportunity to us and a majority of our independent directors has declined the opportunity. |
• | Acquire Existing Ground Leases. We will seek to acquire existing Ground Leases that are marketed for sale and actively solicit potential sellers and related property brokers of existing Ground Leases to engage in off-market transactions. Our structure as an UPREIT gives us the ability to acquire Ground Leases from owners, particularly estates and high net worth individuals, using Operating Partnership units that may provide the seller with tax advantages, as well as liquidity, portfolio diversification and professional management. |
• | Manufacture a Ground Lease with a Third Party. We will seek to pursue opportunities where a third party owner of a commercial property may be interested in utilizing a Ground Lease structure to facilitate its options with respect to its interests in the property. We will manufacture the Ground Lease by splitting ownership of the property into an ownership interest and Ground Lease on the land, and a separate leasehold interest of the building and improvements thereon. We will acquire the ownership interest and Ground Lease on the land from the third party. |
• | Originate Ground Leases to Provide Capital For Development or Value-Add Redevelopment or Repositioning. We will seek opportunities where we can purchase land and simultaneously lease it pursuant to a new Ground Lease to a tenant who plans to develop a new, or significantly improve an existing, commercial property on the land. |
• | Acquire a Commercial Real Estate Property to Create a Ground Lease. We will seek in select instances to acquire commercial real estate properties that have the potential to be converted into an ownership structure that includes a Ground Lease retained by us and a leasehold interest that we will seek to sell to a third party. |
• | Finance Third Party Ground Leases. Combining our capital resources with iStar's relationships and Ground Lease expertise (which will be available to us through our Manager), we will seek opportunities to generate attractive risk-adjusted returns by financing the acquisition of Ground Leases by third parties. |
• | Underlying properties located in major metropolitan areas; |
• | Average remaining initial lease terms of 30 to 99 years; |
• | Periodic contractual rent escalators or percentage rent participations; |
• | Value of approximately 30% to 45% of the Combined Property Value at the commencement of the lease or the acquisition date; |
• | Ground Rent Coverage, defined as the ratio of the Underlying Property's NOI to the annualized base rental payment due us, of approximately 2.0x to 5.0x for the initial 12 month period of the lease. Underlying Property NOI is defined as the trailing twelve month net operating income of the commercial real estate being operated at the property without giving effect to any rent paid or payable under our Ground Lease; |
• | First year cash return on asset of between 3.0% and 5.0%; |
• | Underlying properties that we believe are well located in markets with high barriers to entry and that have durable cash flow; and |
• | Transaction sizes ranging from $20 to $250 million. |
• | temporarily reduced individual U.S. federal income tax rates on ordinary income; the highest individual U.S. federal income tax rate was reduced from 39.6% to 37% (through taxable years ending in 2025); |
• | the maximum corporate U.S Federal income tax rate was reduced from 35% to 21%; |
• | permits non-corporate taxpayers a deduction for certain pass-through business income, including dividends received by our stockholders that we do not designate as capital gain dividends or qualified dividend income, which allows individuals, trusts, and estates to generally deduct up to 20% of such amounts, resulting in an effective maximum U.S. federal income tax rate of 29.6% on such dividends (through taxable years ending in 2025); |
• | reduces the highest rate of withholding with respect to our distributions to non-U.S. stockholders that are treated as attributable to gains from the sale or exchange of U.S. real property interests from 35% to 21%; |
• | limits our deduction for net operating losses that we incur after January 1, 2018 to 80% of our taxable income (prior to the application of the dividends paid deduction) and eliminates our ability to carryback such net operating losses; |
• | limits the deduction of net interest expense for all businesses, other than for certain electing businesses, including electing real estate businesses (which could adversely affect us and any TRSs we may have); |
• | eliminates the corporate alternative minimum tax; and |
• | accelerates our accrual of certain items of income for U.S. federal income tax purposes to the extent that we would otherwise recognize such items of income later than we would report such items on our financial statements. |
2017 | ||||||||||||
Quarter Ended | High | Low | Dividend | |||||||||
December 31 | $ | 19.02 | $ | 17.27 | $ | 0.15 | ||||||
September 30 | $ | 20.00 | $ | 18.02 | 0.15 | |||||||
June 30 | $ | 19.45 | $ | 18.32 | 0.0066 | |||||||
March 31(1) | N/A | N/A |
(1) | We completed our initial public offering on June 27, 2017. As such, per share information for the periods prior to June 27, 2017 is not available. |
Plans Category | (a) Number of securities to be issued upon exercise of outstanding options, warrants and rights | (b) Weighted-average exercise price of outstanding options, warrants and rights | (c) Number of securities remaining available for future issuance under equity compensation plans (excluding securities reflected in column (a)) | ||||||
Equity incentive plans approved by shareholders(1) | — | — | 867,500 | ||||||
Equity incentive plans not approved by shareholders | — | — | — |
(1) | Composed of the 2017 Plan. |
For the Period from April 14, 2017 to December 31, 2017 | For the Period From January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | ||||||||||||||
2016 | 2015 | |||||||||||||||
(In thousands, except per share data) | ||||||||||||||||
OPERATING DATA: | The Company | Predecessor | ||||||||||||||
Ground and other lease income | $ | 16,952 | $ | 5,916 | $ | 21,664 | $ | 18,558 | ||||||||
Total revenues | 17,210 | 6,024 | 21,743 | 18,565 | ||||||||||||
Total costs and expenses | 20,879 | 4,686 | 15,128 | 12,848 | ||||||||||||
Net income (loss) | (3,669 | ) | 1,846 | 6,615 | 5,717 | |||||||||||
Per common share data: | ||||||||||||||||
Net income (loss): | ||||||||||||||||
Basic and diluted | $ | (0.25 | ) | N/A | N/A | N/A | ||||||||||
Dividends declared per common share | $ | 0.3066 | N/A | N/A | N/A |
For the Period from April 14, 2017 to December 31, 2017 | For the Period From January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | ||||||||||||||
2016 | 2015 | |||||||||||||||
(In thousands, except per share data) | ||||||||||||||||
SUPPLEMENTAL DATA: | The Company | Predecessor | ||||||||||||||
FFO(1) | $ | 2,737 | $ | 2,239 | $ | 9,757 | $ | 8,857 | ||||||||
AFFO(1) | 4,057 | 1,352 | 7,161 | 7,327 | ||||||||||||
EBITDA(1) | 10,222 | 5,179 | 17,999 | 16,086 |
(1) | See "Management's Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Financial Measures" for a definition of this metric and a reconciliation to the most directly comparable GAAP number and a statement of why our management believes the presentation of the metric provides useful information to investors. |
As of December 31, | ||||||||||||
2017 | 2016 | 2015 | ||||||||||
(In thousands) | ||||||||||||
BALANCE SHEET DATA: | The Company | Predecessor | ||||||||||
Real estate, net | $ | 408,892 | $ | 104,478 | $ | 103,680 | ||||||
Real estate-related intangible assets, net | 138,725 | 32,680 | 33,109 | |||||||||
Total assets | 728,513 | 155,667 | 144,256 | |||||||||
Debt obligations, net | 307,074 | — | — | |||||||||
Total liabilities | 372,578 | 1,576 | 227 | |||||||||
Total equity | 355,935 | 154,091 | 144,029 | |||||||||
Total liabilities and equity | 728,513 | 155,667 | 144,256 |
Property Name | Location | Property Type | Lease Expiration / As Extended | Rent Escalation Structure | Ground Rent Coverage(1) | ||||||
Doubletree Seattle Airport(2)(3) | Seattle, WA | Hospitality | 2025 / 2035 | % Rent | 3.2x | ||||||
One Ally Center | Detroit, MI | Office | 2114 / 2174 | Fixed with Inflation Protection | 6.0x | (4) | |||||
Hilton Salt Lake(2) | Salt Lake City, UT | Hospitality | 2025 / 2035 | % Rent | 3.7x | ||||||
Hollywood Blvd - South | Los Angeles, CA | Multi-Family | 2104 / 2104 | % of CPI | >5.4x | (5) | |||||
3333 LifeHope | Atlanta, GA | Office | 2116 / 2176 | Fixed | 3.5x | (5) | |||||
Hollywood Blvd - North | Los Angeles, CA | Multi-Family | 2104 / 2104 | % of CPI | >6.0x | (5) | |||||
Doubletree Mission Valley(2) | San Diego, CA | Hospitality | 2025 / 2035 | % Rent | 5.4x | ||||||
Doubletree Durango(2) | Durango, CO | Hospitality | 2025 / 2035 | % Rent | 3.3x | ||||||
Doubletree Sonoma(2) | San Francisco, CA | Hospitality | 2025 / 2035 | % Rent | 5.5x | ||||||
Northside Forsyth Medical Center | Atlanta, GA | Office | 2115 / 2175 | Fixed with Inflation Protection | 3.0x | (5) | |||||
Dallas Market Center - Sheraton Suites | Dallas, TX | Hospitality | 2114 / 2114 | Fixed | 2.3x | (6) | |||||
The Buckler Apartments | Milwaukee, WI | Multi-Family | 2112 / 2112 | Fixed | 9.2x | (6) | |||||
NASA/JPSS Headquarters | Washington, DC | Office | 2075 / 2105 | Fixed | 4.9x | ||||||
Lock Up Self Storage Facility | Minneapolis, MN | Industrial | 2037 / 2037 | Fixed | 6.6x | (6) | |||||
Dallas Market Center - Marriott Courtyard | Dallas, TX | Hospitality | 2026 / 2066 | % Rent | 17.9x | (6) | |||||
Total / Weighted Average | 49 / 67 yrs | 4.7x |
(1) | Ground Rent Coverage is defined as the ratio of the Underlying Property's NOI to the annualized base rental payment due us. Underlying Property NOI is defined as the trailing twelve month net operating income of the commercial real estate being operated at the property without giving effect to any rent paid or payable under our Ground Lease. Net operating income is calculated as property-level revenues less property-level operating expenses as reported to us by the tenant, or as otherwise publicly available. We rely on net operating income as reported to us by our tenants, or as otherwise publicly available, without any independent investigation by us. |
(2) | Property is part of the Park Hotels Portfolio and is subject to a single master lease. |
(3) | A majority of the land underlying this property is owned by a third party and is ground leased to us through 2044 subject to changes in the CPI; however, our tenant pays this cost directly to the third party. |
(4) | For One Ally Center, calculated using Underlying Property NOI of approximately $15.4 million, calculated as the underwritten net operating income for One Ally Center as reported in the prospectus dated December 14, 2017 of the Wells Fargo Commercial Mortgage Trust 2017-C42, and adding back the ground rent payable to us. |
(5) | Calculated using estimated Underlying Property NOI which, for properties under development or renovation, reflects our estimated annual rent coverage at the expected stabilization or completion of renovation at the applicable property. |
(6) | Underlying Property NOI is based on trailing twelve month September 30, 2017 figures. |
For the Period from April 14, 2017 to December 31, 2017 | For the Period From January 1, 2017 to April 13, 2017 | For the Year Ended December 31, 2017 | For the Year Ended December 31, 2016 | |||||||||||||||||||
$ Change | % Change | |||||||||||||||||||||
(in thousands) | ||||||||||||||||||||||
The Company | Predecessor | Predecessor | ||||||||||||||||||||
Revenues | ||||||||||||||||||||||
Ground and other lease income | $ | 16,952 | $ | 5,916 | $ | 22,868 | $ | 21,664 | $ | 1,204 | 6 | % | ||||||||||
Other income | 258 | 108 | 366 | 79 | 287 | >100% | ||||||||||||||||
Total revenue | 17,210 | 6,024 | 23,234 | 21,743 | 1,491 | 7 | % | |||||||||||||||
Costs and expenses | ||||||||||||||||||||||
Interest expense | 7,485 | 2,432 | 9,917 | 8,242 | 1,675 | 20 | % | |||||||||||||||
Real estate expenses(2) | 1,261 | 210 | 1,471 | 861 | 610 | 71 | % | |||||||||||||||
Depreciation and amortization | 6,406 | 901 | 7,307 | 3,142 | 4,165 | >100% | ||||||||||||||||
General and administrative | 5,094 | 1,143 | 6,237 | 2,883 | 3,354 | >100% | ||||||||||||||||
Other expense | 633 | — | 633 | — | 633 | 100 | % | |||||||||||||||
Total costs and expenses | 20,879 | 4,686 | 25,565 | 15,128 | 10,437 | 69 | % | |||||||||||||||
Income from sales of real estate | — | 508 | 508 | — | 508 | 100 | % | |||||||||||||||
Net income (loss) | $ | (3,669 | ) | $ | 1,846 | $ | (1,823 | ) | $ | 6,615 | $ | (8,438 | ) | >(100%) |
(1) | Operations prior to April 14, 2017 represent the activity of Safety, Income & Growth Inc. Predecessor. In addition, as a result of our acquisition of the Initial Portfolio from iStar, the periods subsequent to April 14, 2017 are presented on a new basis of accounting pursuant to Accounting Standards Codification ("ASC") 805. |
(2) | Real estate expense includes reimbursable property taxes at one of our properties. |
For the Period from April 14, 2017 to December 31, 2017 | For the Period From January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | ||||||||||||||
2017 | 2016 | |||||||||||||||
Non-cash expenses | ||||||||||||||||
Allocation from iStar | $ | — | $ | 807 | $ | 807 | $ | 2,470 | ||||||||
Stock-based compensation(1) | 766 | 246 | 1,012 | 364 | ||||||||||||
Management fees(2) | 1,988 | — | 1,988 | — | ||||||||||||
Expense reimbursements to the Manager(2) | 639 | — | 639 | — | ||||||||||||
Subtotal - non-cash expenses | 3,393 | 1,053 | 4,446 | 2,834 | ||||||||||||
Cash expenses | ||||||||||||||||
Public company and other costs | 1,701 | 90 | 1,791 | 49 | ||||||||||||
Subtotal - cash expenses | 1,701 | 90 | 1,791 | 49 | ||||||||||||
Total general and administrative expenses | $ | 5,094 | $ | 1,143 | $ | 6,237 | $ | 2,883 |
(1) | For the period from January 1, 2017 to April 13, 2017 and the year ended December 31, 2016, stock-based compensation represents an allocation from iStar. |
(2) | Waived through June 30, 2018. |
For the Years Ended December 31, | ||||||||||||||
2016 | 2015 | $ Change | % Change | |||||||||||
(in thousands) | ||||||||||||||
Revenues | ||||||||||||||
Ground and other lease income | $ | 21,664 | $ | 18,558 | $ | 3,106 | 17 | % | ||||||
Other income | 79 | 7 | 72 | >100% | ||||||||||
Total revenue | 21,743 | 18,565 | 3,178 | 17 | % | |||||||||
Costs and expenses | ||||||||||||||
Interest expense | 8,242 | 7,229 | 1,013 | 14 | % | |||||||||
Real estate expenses | 861 | 217 | 644 | >100% | ||||||||||
Depreciation and amortization | 3,142 | 3,140 | 2 | — | % | |||||||||
General and administrative | 2,883 | 2,262 | 621 | 27 | % | |||||||||
Total costs and expenses | 15,128 | 12,848 | 2,280 | 18 | % | |||||||||
Net income | $ | 6,615 | $ | 5,717 | $ | 898 | 16 | % |
For the Period from April 14, 2017 to December 31, 2017 | For the Period from January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | ||||||||||||||
2016 | 2015 | |||||||||||||||
(in thousands) | ||||||||||||||||
Funds from Operations | The Company | Predecessor | ||||||||||||||
Net income (loss) | $ | (3,669 | ) | $ | 1,846 | $ | 6,615 | $ | 5,717 | |||||||
Add: Depreciation and amortization | 6,406 | 901 | 3,142 | 3,140 | ||||||||||||
Less: Income from sales of real estate | — | (508 | ) | — | — | |||||||||||
FFO | $ | 2,737 | $ | 2,239 | $ | 9,757 | $ | 8,857 | ||||||||
Adjusted Funds from Operations | ||||||||||||||||
FFO | $ | 2,737 | $ | 2,239 | $ | 9,757 | $ | 8,857 | ||||||||
Straight-line rental income | (4,097 | ) | (1,271 | ) | (4,374 | ) | (2,902 | ) | ||||||||
Amortization of real estate-related intangibles, net | 1,178 | 118 | 414 | 332 | ||||||||||||
Stock-based compensation | 766 | 246 | 364 | 331 | ||||||||||||
Acquisition costs | 381 | — | — | — | ||||||||||||
Non-cash management fees and expense reimbursements | 2,627 | — | — | — | ||||||||||||
Non-cash interest expense | 465 | 20 | 1,000 | 709 | ||||||||||||
AFFO(2) | $ | 4,057 | $ | 1,352 | $ | 7,161 | $ | 7,327 |
(1) | Operations prior to April 14, 2017 represent the activity of Safety, Income & Growth Inc. Predecessor. |
(2) | For the period from April 14, 2017 to December 31, 2017, AFFO does not include any percentage rent from the Park Hotels Portfolio, which is recorded annually in the first quarter of each year. For the year ended December 31, 2016, we recorded $3.0 million in percentage rent from the Park Hotels Portfolio. |
For the Period from April 14, 2017 to December 31, 2017 | For the Period from January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | ||||||||||||||
2016 | 2015 | |||||||||||||||
(in thousands) | ||||||||||||||||
EBITDA | The Company | Predecessor | ||||||||||||||
Net income (loss) | $ | (3,669 | ) | $ | 1,846 | $ | 6,615 | $ | 5,717 | |||||||
Add: Interest expense | 7,485 | 2,432 | 8,242 | 7,229 | ||||||||||||
Add: Depreciation and amortization | 6,406 | 901 | 3,142 | 3,140 | ||||||||||||
EBITDA | $ | 10,222 | $ | 5,179 | $ | 17,999 | $ | 16,086 |
(1) | Operations prior to April 14, 2017 represent the activity of Safety, Income & Growth Inc. Predecessor. |
Amounts Due By Period | |||||||||||||||||||||||
Total | Less Than 1 Year | 1 - 3 Years | 3 - 5 Years | 5 - 10 Years | After 10 Years | ||||||||||||||||||
(in thousands) | |||||||||||||||||||||||
Long-Term Debt Obligations(1): | |||||||||||||||||||||||
2017 Secured Financing | $ | 227,000 | $ | — | $ | — | $ | — | $ | 227,000 | $ | — | |||||||||||
2017 Revolver | 10,000 | — | — | 10,000 | — | — | |||||||||||||||||
2017 Hollywood Mortgage | 71,000 | — | — | — | 71,000 | — | |||||||||||||||||
Total principal maturities | 308,000 | — | — | 10,000 | 298,000 | — | |||||||||||||||||
Interest Payable() | 92,662 | 11,110 | 22,250 | 22,068 | 37,234 | — | |||||||||||||||||
Purchase Commitments(3) | 33,959 | — | 33,959 | — | — | — | |||||||||||||||||
Total(4) | $ | 434,621 | $ | 11,110 | $ | 56,209 | $ | 32,068 | $ | 335,234 | $ | — |
(1) | Assumes the extended maturity date for all debt obligations. |
(2) | Interest payable does not include interest that may be payable under our derivatives. |
(3) | Refer to Note 4 of the consolidated and combined financial statements. |
(4) | We are also obligated to pay the third-party owner of a property that is ground leased to us $0.4 million, subject to adjustment for changes in the CPI, per year through 2044; however, our tenant pays this expense directly under the terms of a master lease through 2035. |
Change in Interest Rates | Net Income | |||
-100 Basis Points | $ | (549 | ) | |
-50 Basis Points | (120 | ) | ||
-10 Basis Points | (24 | ) | ||
Base Interest Rate | — | |||
+10 Basis Points | 24 | |||
+ 50 Basis Points | 120 | |||
+100 Basis Points | 240 |
Page | |
Financial Statements: | |
Financial Statement Schedule: | |
As of December 31, | |||||||
2017 | 2016 | ||||||
ASSETS | The Company | Predecessor | |||||
Real estate | |||||||
Real estate, at cost | $ | 413,145 | $ | 165,699 | |||
Less: accumulated depreciation | (4,253 | ) | (61,221 | ) | |||
Total real estate, net | 408,892 | 104,478 | |||||
Real estate-related intangible assets, net (refer to Note 4) | 138,725 | 32,680 | |||||
Total real estate, net and real estate-related intangible assets, net | 547,617 | 137,158 | |||||
Cash and cash equivalents | 168,214 | — | |||||
Restricted cash | 1,656 | — | |||||
Ground and other lease income receivable, net | — | 3,482 | |||||
Deferred ground and other lease income receivable, net | 4,097 | 8,423 | |||||
Deferred expenses and other assets, net | 6,929 | 6,604 | |||||
Total assets | $ | 728,513 | $ | 155,667 | |||
LIABILITIES AND EQUITY | |||||||
Liabilities: | |||||||
Accounts payable, accrued expenses and other liabilities | $ | 7,545 | $ | 1,576 | |||
Real estate-related intangible liabilities, net | 57,959 | — | |||||
Debt obligations, net | 307,074 | — | |||||
Total liabilities | 372,578 | 1,576 | |||||
Commitments and contingencies (refer to Note 7) | — | — | |||||
Equity: | |||||||
Safety, Income & Growth Inc. Predecessor Equity | 154,091 | ||||||
Safety, Income & Growth Inc. Shareholders' Equity: | |||||||
Common stock, $0.01 par value, 400,000 shares authorized, 18,190 and 0 shares issued and outstanding as of December 31, 2017 and 2016, respectively | 182 | — | |||||
Additional paid-in capital | 364,919 | — | |||||
Retained earnings (deficit) | (9,246 | ) | — | ||||
Accumulated other comprehensive income (loss) | 80 | — | |||||
Total equity | 355,935 | 154,091 | |||||
Total liabilities and equity | $ | 728,513 | $ | 155,667 |
For the Period from April 14, 2017 to December 31, 2017 | For the Period From January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | |||||||||||||
2016 | 2015 | ||||||||||||||
Revenues: | The Company | Predecessor | |||||||||||||
Ground and other lease income | $ | 16,952 | $ | 5,916 | $ | 21,664 | $ | 18,558 | |||||||
Other income | 258 | 108 | 79 | 7 | |||||||||||
Total revenues | 17,210 | 6,024 | 21,743 | 18,565 | |||||||||||
Costs and expenses: | |||||||||||||||
Interest expense | 7,485 | 2,432 | 8,242 | 7,229 | |||||||||||
Real estate expense(2) | 1,261 | 210 | 861 | 217 | |||||||||||
Depreciation and amortization | 6,406 | 901 | 3,142 | 3,140 | |||||||||||
General and administrative | 5,094 | 1,143 | 2,883 | 2,262 | |||||||||||
Other expense | 633 | — | — | — | |||||||||||
Total costs and expenses | 20,879 | 4,686 | 15,128 | 12,848 | |||||||||||
Income (loss) from operations | (3,669 | ) | 1,338 | 6,615 | 5,717 | ||||||||||
Income from sales of real estate | — | 508 | — | — | |||||||||||
Net income (loss) | (3,669 | ) | 1,846 | 6,615 | 5,717 | ||||||||||
Net income attributable to noncontrolling interest | — | — | — | (368 | ) | ||||||||||
Net income (loss) attributable to Safety, Income & Growth Inc. | $ | (3,669 | ) | $ | 1,846 | $ | 6,615 | $ | 5,349 | ||||||
Per common share data: | |||||||||||||||
Net income (loss) | |||||||||||||||
Basic and diluted | $ | (0.25 | ) | N/A | N/A | N/A | |||||||||
Weighted average number of common shares: | |||||||||||||||
Basic and diluted | 14,648 | N/A | N/A | N/A |
(2) | For the period from January 1, 2017 to April 13, 3017 and April 14, 2017 to December 31, 2017, real estate expense includes reimbursable property taxes of $0.2 million at one of the Company's properties. For the period from April 14, 2017 to December 31, 2017, real estate expense includes non-cash rent expense of $0.7 million related to the amortization of a below market lease asset at one of the Company's hotel properties. |
For the Period from April 14, 2017 to December 31, 2017 | For the Period From January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | |||||||||||||
2016 | 2015 | ||||||||||||||
The Company | Predecessor | ||||||||||||||
Net income (loss) | $ | (3,669 | ) | $ | 1,846 | $ | 6,615 | $ | 5,717 | ||||||
Other comprehensive income (loss): | |||||||||||||||
Reclassification of (gains) losses on derivatives into earnings | 110 | — | — | — | |||||||||||
Unrealized gains/(losses) on derivatives | (30 | ) | 415 | — | — | ||||||||||
Other comprehensive income (loss) | 80 | 415 | — | — | |||||||||||
Comprehensive income (loss) | (3,589 | ) | 2,261 | 6,615 | 5,717 | ||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | — | — | — | (368 | ) | ||||||||||
Comprehensive income (loss) attributable to Safety, Income & Growth Inc. | $ | (3,589 | ) | $ | 2,261 | $ | 6,615 | $ | 5,349 |
(1) | The combined statements of comprehensive income prior to April 14, 2017 represent the activity of Safety, Income & Growth Inc. Predecessor. |
Safety, Income & Growth Inc. Predecessor Equity | Common Stock at Par | Additional Paid-In Capital | Retained Earnings (Deficit) | Accumulated Other Comprehensive Income (Loss) | Noncontrolling Interest | Total Equity | ||||||||||||||||||||||
Predecessor | ||||||||||||||||||||||||||||
Balance as of December 31, 2014 | $ | 105,124 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 105,124 | ||||||||||||||
Net income | 5,349 | — | — | — | — | 368 | 5,717 | |||||||||||||||||||||
Net transactions with iStar Inc. | 36,315 | — | — | — | — | — | 36,315 | |||||||||||||||||||||
Contribution from noncontrolling interest | — | — | — | — | — | 3,819 | 3,819 | |||||||||||||||||||||
Distributions to noncontrolling interest | — | — | — | — | — | (594 | ) | (594 | ) | |||||||||||||||||||
Acquisition of noncontrolling interest | (2,759 | ) | — | — | — | — | (3,593 | ) | (6,352 | ) | ||||||||||||||||||
Balance as of December 31, 2015 | $ | 144,029 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 144,029 | ||||||||||||||
Net income | 6,615 | — | — | — | — | — | 6,615 | |||||||||||||||||||||
Net transactions with iStar Inc. | 3,447 | — | — | — | — | — | 3,447 | |||||||||||||||||||||
Balance as of December 31, 2016 | $ | 154,091 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 154,091 | ||||||||||||||
Net income | 1,846 | — | — | — | — | — | 1,846 | |||||||||||||||||||||
Unrealized gain on cash flow hedge | 415 | — | — | — | — | — | 415 | |||||||||||||||||||||
Net transactions with iStar Inc. | (220,813 | ) | — | — | — | — | — | (220,813 | ) | |||||||||||||||||||
Balance as of April 13, 2017 | $ | (64,461 | ) | $ | — | $ | — | $ | — | $ | — | $ | — | $ | (64,461 | ) | ||||||||||||
The Company | ||||||||||||||||||||||||||||
Net income (loss) | $ | — | $ | — | $ | — | $ | (3,669 | ) | $ | — | $ | — | $ | (3,669 | ) | ||||||||||||
Proceeds from issuance of common stock to initial investors | — | 57 | 112,943 | — | — | — | 113,000 | |||||||||||||||||||||
Proceeds from issuance of common stock in initial public offering | — | 125 | 249,875 | — | — | — | 250,000 | |||||||||||||||||||||
Contributions from iStar | — | — | 21,567 | — | — | — | 21,567 | |||||||||||||||||||||
Offering costs | — | — | (20,232 | ) | — | — | — | (20,232 | ) | |||||||||||||||||||
Issuance of common stock to directors | — | — | 766 | — | — | — | 766 | |||||||||||||||||||||
Dividends declared | — | — | — | (5,577 | ) | — | — | (5,577 | ) | |||||||||||||||||||
Change in accumulated other comprehensive income (loss) | — | — | — | — | 80 | — | 80 | |||||||||||||||||||||
Balance as of December 31, 2017 | $ | — | $ | 182 | $ | 364,919 | $ | (9,246 | ) | $ | 80 | $ | — | $ | 355,935 |
For the Period from April 14, 2017 to December 31, 2017 | For the Period From January 1, 2017 to April 13, 2017 | For the Years Ended December 31, | |||||||||||||
2016 | 2015 | ||||||||||||||
The Company | Predecessor | ||||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net income (loss) | $ | (3,669 | ) | $ | 1,846 | $ | 6,615 | $ | 5,717 | ||||||
Adjustments to reconcile net income (loss) to cash flows from operating activities: | |||||||||||||||
Depreciation and amortization | 6,406 | 901 | 3,142 | 3,140 | |||||||||||
Non-cash expense for stock-based compensation | 766 | — | — | — | |||||||||||
Deferred ground and other lease income | (4,097 | ) | (1,271 | ) | (4,374 | ) | (2,902 | ) | |||||||
Income from sales of real estate | — | (508 | ) | — | — | ||||||||||
Amortization of real estate-related intangibles, net | 1,178 | 118 | 414 | 332 | |||||||||||
Amortization of premium and deferred financing costs on debt obligations, net | 465 | — | — | — | |||||||||||
Management fees and non-cash expense reimbursements to the Manager | 2,627 | — | — | — | |||||||||||
Other operating activities | 15 | 24 | — | — | |||||||||||
Changes in assets and liabilities: | |||||||||||||||
Changes in ground and other lease income receivable, net | 1,394 | 2,088 | (858 | ) | (588 | ) | |||||||||
Changes in deferred expenses and other assets, net | 151 | (576 | ) | (39 | ) | (430 | ) | ||||||||
Changes in accounts payable, accrued expenses and other liabilities | 852 | (13 | ) | 580 | (244 | ) | |||||||||
Cash flows provided by operating activities | 6,088 | 2,609 | 5,480 | 5,025 | |||||||||||
Cash flows from investing activities: | |||||||||||||||
Acquisitions of real estate | (270,734 | ) | — | (3,915 | ) | — | |||||||||
Proceeds from sales of real estate | — | 508 | — | — | |||||||||||
Other investing activities | (2,443 | ) | (1,042 | ) | (4,057 | ) | — | ||||||||
Cash flows used in investing activities | (273,177 | ) | (534 | ) | (7,972 | ) | — | ||||||||
Cash flows from financing activities: | |||||||||||||||
Net transactions with iStar Inc. | — | (220,813 | ) | 3,447 | 1,943 | ||||||||||
Distributions to noncontrolling interest | — | — | — | (594 | ) | ||||||||||
Contributions from noncontrolling interest | — | — | — | (6,352 | ) | ||||||||||
Contribution from iStar Inc. | 14,350 | — | — | — | |||||||||||
Proceeds from issuance of common stock | 363,000 | — | — | — | |||||||||||
Proceeds from debt obligations | 176,000 | 227,000 | — | — | |||||||||||
Repayments of debt obligations | (95,000 | ) | — | — | — | ||||||||||
Payments for deferred financing costs | (4,170 | ) | (7,217 | ) | — | — | |||||||||
Payment of offering costs | (14,372 | ) | (779 | ) | (977 | ) | — | ||||||||
Dividends paid to common shareholders | (2,849 | ) | — | — | — | ||||||||||
Cash flows provided by (used in) financing activities | 436,959 | (1,809 | ) | 2,470 | (5,003 | ) | |||||||||
Changes in cash, cash equivalents and restricted cash | 169,870 | 266 | (22 | ) | 22 | ||||||||||
Cash, cash equivalents and restricted cash at beginning of period | — | — | 22 | — | |||||||||||
Cash, cash equivalents and restricted cash at end of period | $ | 169,870 | $ | 266 | $ | — | $ | 22 | |||||||
Supplemental disclosure of cash flow information: | |||||||||||||||
Cash paid for interest | $ | 6,528 | $ | 168 | $ | — | $ | — | |||||||
Supplemental disclosure of non-cash investing and financing activity: | |||||||||||||||
Assumption of debt obligations | $ | 227,415 | $ | — | $ | — | $ | — | |||||||
Contribution from iStar Inc. | 7,217 | — | — | — | |||||||||||
Dividends declared to common shareholders | 2,728 | — | — | — | |||||||||||
Accrued offering costs | 1,347 | — | 769 | — | |||||||||||
Accrued finance costs | 128 | 21 | — | — | |||||||||||
Contribution from noncontrolling interest | — | — | — | 3,819 | |||||||||||
Net transactions with iStar Inc. | — | — | — | 34,372 |
Derivative Type | Maturity | Notional Amount | Fair Value(2) | Balance Sheet Location | ||||||||
Assets | ||||||||||||
Interest rate swap | October 2020 | $ | 95,000 | $ | 798 | Deferred expenses and other assets, net | ||||||
Interest rate swap | October 2020 | 10,000 | 128 | Deferred expenses and other assets, net | ||||||||
Interest rate swap | October 2030 | 10,000 | 98 | Deferred expenses and other assets, net | ||||||||
Interest rate cap(3) | January 2021 | 71,000 | 18 | Deferred expenses and other assets, net | ||||||||
Total | $ | 1,042 | ||||||||||
Liabilities | ||||||||||||
Interest rate swap | October 2030 | 95,000 | $ | 619 | Accounts payable, accrued expenses and other liabilities | |||||||
Interest rate swap | October 2030 | 22,000 | 285 | Accounts payable, accrued expenses and other liabilities | ||||||||
Total | $ | 904 |
(1) | For the period from April 14, 2017 to December 31, 2017, the Company recognized $0.1 million in accumulated other comprehensive income (loss). |
(2) | The fair value of the Company's derivatives are based upon widely accepted valuation techniques utilized by a third-party specialist using observable inputs such as interest rates and contractual cash flow and are classified as Level 2. Over the next 12 months, the Company expects that $0.1 million related to cash flow hedges will be reclassified from "Accumulated other comprehensive income (loss)" into interest expense. |
(3) | This derivative is not designated in a hedging relationship. |
Derivatives Designated in Hedging Relationships | Location of Gain (Loss) Recognized in Income | Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Effective Portion) | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Earnings (Effective Portion) | Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Earnings (Ineffective Portion) | ||||||||||
Interest rate swaps | Interest expense / Other expense(1) | $ | 30 | $ | 110 | $ | 22 |
(1) | The effective portion recognized in earnings was recorded in interest expense and the ineffective portion recognized in earnings was recorded in other expense. |
Location of Gain or (Loss) Recognized in Income | Amount of Gain or (Loss) Recognized in Income | |||||
Derivatives not Designated in Hedging Relationships | ||||||
Interest rate cap | Other Expense | $ | (5 | ) |
December 31, 2017 | December 31, 2016 | |||||||
Cash and cash equivalents | $ | 168,214 | $ | — | ||||
Restricted cash(1) | 1,656 | — | ||||||
Total cash, cash equivalents and restricted cash reported in the consolidated statement of cash flows | $ | 169,870 | $ | — |
(1) | Restricted cash includes cash balances required to be maintained under certain of the Company's derivative transactions. |
As of | |||||||
December 31, 2017 | December 31, 2016 | ||||||
Land and land improvements, at cost | $ | 220,749 | $ | 41,160 | |||
Buildings and improvements, at cost | 192,396 | 124,539 | |||||
Less: accumulated depreciation | (4,253 | ) | (61,221 | ) | |||
Total real estate, net | $ | 408,892 | $ | 104,478 | |||
Real estate-related intangible assets, net | 138,725 | 32,680 | |||||
Total real estate, net and real estate-related intangible assets, net | $ | 547,617 | $ | 137,158 |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed at their acquisition date fair values. In February 2017, the Company sold a parking facility from its Park Hotels Portfolio for $0.5 million that had been previously impaired and had a carrying value of zero. |
As of | |||||||
December 31, 2017 | December 31, 2016 | ||||||
Above-market lease assets, net(2) | $ | 77,197 | $ | — | |||
In-place lease assets, net(3) | 35,744 | — | |||||
Below-market lease asset, net(4) | 25,784 | — | |||||
Lease incentives, net(5) | — | 32,545 | |||||
Other intangible assets, net | — | 135 | |||||
Real estate-related intangible assets, net | $ | 138,725 | $ | 32,680 |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed at their acquisition date fair values. |
(2) | Above-market lease assets are recognized during business combinations when the present value of market rate rental cash flows over the term of a lease is less than the present value of the contractual in-place rental cash flows. Accumulated amortization on above-market lease assets was $0.9 million as of December 31, 2017. The amortization of above-market lease assets decreased "Ground and other lease income" in the Company's consolidated statements of operations by $0.9 million for the period from April 14, 2017 to December 31, 2017. Above-market lease assets are amortized over the non-cancelable term of the leases. |
(3) | In-place lease assets are recognized during business combinations and are estimated based on the value associated with the costs avoided in originating leases comparable to the acquired in-place leases as well as the value associated with lost rental revenue during the assumed lease-up period. Accumulated amortization on in-place lease assets was $2.2 million as of December 31, 2017. The amortization expense for in-place leases was $2.2 million for the period from April 14, 2017 to December 31, 2017. This amount is included in "Depreciation and amortization" in the Company's consolidated statements of operations. In-place lease assets are amortized over the non-cancelable term of the leases. |
(4) | Below-market lease asset, net resulted from the acquisition of the Initial Portfolio and relates to a property that is majority-owned by a third party and is ground leased to the Company. The Company is obligated to pay the third-party owner of the property $0.4 million, subject to adjustment for changes in the CPI, per year through 2044; however, the Company's tenant pays this expense directly under the terms of a master lease. Accumulated amortization on the below-market lease asset was $0.7 million as of December 31, 2017. The amortization expense for the Company's below-market lease asset was $0.7 million for the period from April 14, 2017 to December 31, 2017. This amount is included in "Real estate expense" in the Company's consolidated statements of operations. The below-market lease asset is amortized over the non-cancelable term of the lease. |
(5) | Accumulated amortization on lease incentives was $2.1 million as of December 31, 2016. The amortization of lease incentives decreased "Ground and other lease income" in the Company's combined statements of operations by $0.1 million for the period from January 1, 2017 to April 13, 2017 and $0.4 million and $0.3 million for the years ended December 31, 2016 and 2015, respectively. Lease incentive assets are amortized over the non-cancelable term of the leases. |
Year | Amount | ||
2018 | 5,376 | ||
2019 | 5,376 | ||
2020 | 5,376 | ||
2021 | 5,376 | ||
2022 | 5,376 |
(1) | As of December 31, 2017, the weighted average amortization period for the Company's real estate-related intangible assets was approximately 60 years. |
As of | |||||||
December 31, 2017 | December 31, 2016 | ||||||
Below-market lease liabilities(2) | $ | 57,959 | $ | — | |||
Real estate-related intangible liabilities, net | $ | 57,959 | $ | — |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed at their acquisition date fair values. |
(2) | Below-market lease liabilities are recognized during business combinations when the present value of market rate rental cash flows over the term of a lease exceeds the present value of the contractual in-place rental cash flows. Accumulated amortization on below-market lease liabilities was $0.4 million as of December 31, 2017. The amortization of below-market lease liabilities increased "Ground and other lease income" in the Company's consolidated statements of operations by $0.4 million for the period from April 14, 2017 to December 31, 2017. |
Initial Portfolio | 6200 Hollywood Blvd. | 6201 Hollywood Blvd. | Total | |||||||||||||
Assets | ||||||||||||||||
Land and land improvements, at cost | $ | 73,472 | $ | 68,140 | $ | 72,836 | $ | 214,448 | ||||||||
Buildings and improvements, at cost | 192,396 | — | — | 192,396 | ||||||||||||
Real estate | 265,868 | 68,140 | 72,836 | 406,844 | ||||||||||||
Real estate-related intangible assets(1) | 124,017 | 5,500 | 3,258 | 132,775 | ||||||||||||
Other assets | 1,174 | — | — | 1,174 | ||||||||||||
Total assets | $ | 391,059 | $ | 73,640 | $ | 76,094 | $ | 540,793 | ||||||||
Liabilities | ||||||||||||||||
Real estate-related intangible liabilities(2) | $ | 50,644 | $ | — | $ | 7,734 | $ | 58,378 | ||||||||
Debt obligations | 227,415 | — | — | 227,415 | ||||||||||||
Total liabilities | 278,059 | — | 7,734 | 285,793 | ||||||||||||
Purchase Price(3) | $ | 113,000 | $ | 73,640 | $ | 68,360 | $ | 255,000 |
(1) | Intangible assets primarily includes above market and in-place lease assets related to the acquisition of real estate assets. The amortization of above market lease assets is recorded as a reduction to "Ground and other lease income" in the Company's consolidated and combined statements of operations and are amortized over the term of the leases. The amortization expense for in-place leases is recorded in "Depreciation and amortization" in the Company's consolidated statements of operations. In addition, intangible assets from the acquisition of the Initial Portfolio includes a below market lease asset on a property that is majority-owned by a third party that is ground leased to the Company. The Company is obligated to pay the third-party owner of the property $0.4 million, subject to adjustment for changes in the CPI, per year through 2044; however, the Company's tenant pays this expense directly under the terms of a master lease. The amortization of the below market lease asset is recorded to "Real estate expense" in the Company's consolidated statements of operations. |
(2) | Intangible liabilities includes below market lease liabilities related to the acquisition of real estate assets. The amortization of below market lease liabilities is recorded as an increase to "Ground and other lease income" in the Company's consolidated statements of operations. |
(3) | The Company paid $340.0 million in total consideration to iStar for the Initial Portfolio, including the proceeds from the 2017 Secured Financing. |
For the Years Ended December 31, | |||||||
2017 | 2016 | ||||||
Pro forma revenues | $ | 25,828 | $ | 27,422 | |||
Pro forma net income (loss) (1) | (803 | ) | 5,484 |
(1) | The combined statements of operations prior to April 14, 2017 represented the activity of the Predecessor and EPS was not applicable. The acquisition of the Initial Portfolio is included in EPS for the period from April 14, 2017 to December 31, 2017. The acquisitions of 6200 Hollywood Boulevard and 6201 Hollywood Boulevard would have increased EPS by $0.07 if the acquisitions had occurred on April 14, 2017. |
Year | Leases with CPI Based Escalations | Leases with Fixed Escalations | Leases with Revenue Participation (1) | Total | ||||||||||||
2018 | $ | 4,993 | $ | 5,172 | $ | 10,032 | $ | 20,197 | ||||||||
2019 | 4,993 | 5,245 | 10,032 | 20,270 | ||||||||||||
2020 | 4,993 | 5,323 | 10,032 | 20,348 | ||||||||||||
2021 | 4,993 | 5,409 | 10,032 | 20,434 | ||||||||||||
2022 | 4,993 | 5,488 | 10,032 | 20,513 |
(1) | Represents contractual base rent only and does not include percentage rent that is not fixed and determinable. |
As of | |||||||
December 31, 2017 | December 31, 2016 | ||||||
Purchase deposit | $ | 2,855 | $ | — | |||
Deferred finance costs, net(2) | 2,490 | — | |||||
Derivative assets | 1,042 | — | |||||
Other assets(3) | 450 | 5,841 | |||||
Leasing costs, net(4) | 92 | 763 | |||||
Deferred expenses and other assets, net | $ | 6,929 | $ | 6,604 |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed at their acquisition date fair values. |
(2) | Accumulated amortization of deferred finance costs was $0.5 million as of December 31, 2017. |
(3) | As of December 31, 2016, other assets included a $4.1 million receivable related to the funding provided to a certain investment in a Ground Lease the Company entered into during the year ended December 31, 2016. In addition, as of December 31, 2016 other assets includes $1.7 million in deferred offering costs. |
(4) | Accumulated amortization of leasing costs was $28 thousand as of December 31, 2016. |
As of | |||||||
December 31, 2017 | December 31, 2016 | ||||||
Dividends declared and payable | $ | 2,728 | $ | — | |||
Accounts payable(2) | 1,347 | 779 | |||||
Accrued expenses(3) | 1,285 | 708 | |||||
Derivative liabilities | 904 | — | |||||
Interest payable | 660 | — | |||||
Other liabilities(4) | 621 | 89 | |||||
Accounts payable, accrued expenses and other liabilities | $ | 7,545 | $ | 1,576 |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed at their acquisition date fair values. |
(2) | As of December 31, 2017 and 2016, accounts payable includes accrued offering costs. |
(3) | As of December 31, 2017, accrued expenses primarily includes accrued legal expenses, accrued audit expenses and recoverable real estate taxes paid by the Company and reimbursed by the tenant. As of December 31, 2016, accrued expenses primarily includes recoverable real estate taxes paid by the Company and reimbursed by the tenant. |
(4) | As of December 31, 2017, other liabilities includes unearned rent and $0.1 million due to the Manager for costs it paid on the Company's behalf. |
As of | Stated Interest Rate | Scheduled Maturity Date(2) | |||||||||
December 31, 2017 | December 31, 2016 | ||||||||||
Secured credit financing: | |||||||||||
2017 Secured Financing(1) | $ | 227,000 | $ | — | 3.795% | April 2027 | |||||
2017 Hollywood Mortgage(3) | 71,000 | — | LIBOR plus 1.33% | January 2023 | |||||||
2017 Revolver(3) | 10,000 | — | LIBOR plus 1.35% | June 2022 | |||||||
Total secured credit financing | 308,000 | — | |||||||||
Total debt obligations | 308,000 | — | |||||||||
Debt premium and deferred financing costs, net(1) | (926 | ) | — | ||||||||
Total debt obligations, net | $ | 307,074 | $ | — |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed, including the 2017 Secured Financing, at their acquisition date fair values. As a result, the Company recorded a $0.4 million premium on the 2017 Secured Financing. |
(2) | Represents the extended maturity date. |
(3) | LIBOR in effect as of December 31, 2017 is one-month LIBOR. |
2017 Secured Financing | 2017 Hollywood Mortgage | 2017 Revolver | Total | ||||||||||||
2018 | $ | — | $ | — | $ | — | $ | — | |||||||
2019 | — | — | — | — | |||||||||||
2020 | — | — | — | — | |||||||||||
2021 | — | — | — | — | |||||||||||
2022 | — | — | 10,000 | 10,000 | |||||||||||
Thereafter | 227,000 | 71,000 | — | 298,000 | |||||||||||
Total principal maturities | 227,000 | 71,000 | 10,000 | 308,000 | |||||||||||
Debt premium and deferred financing costs, net | (926 | ) | |||||||||||||
Total debt obligations, net | $ | 307,074 |
Event | Date | Owner | # of shares | Price paid Per Share | |||||||
Initial capitalization | April 14, 2017 | Third parties | 2,875,000 | $ | 20.00 | ||||||
Initial capitalization | April 14, 2017 | iStar | 2,775,000 | 20.00 | |||||||
Initial public offering | June 27, 2017 | Third parties | 10,250,000 | 20.00 | |||||||
Concurrent iStar placement | June 27, 2017 | iStar | 2,250,000 | 20.00 | |||||||
Issuance of shares to directors | June 27, 2017 | Directors | 40,000 | — | |||||||
Shares outstanding at June 27, 2017 | 18,190,000 |
For the Period from April 14, 2017 to December 31, 2017 | ||||
Income (loss) from operations | $ | (3,669 | ) | |
Income (loss) from operations attributable and allocable to common shareholders for basic and diluted earnings per common share | $ | (3,669 | ) |
(1) | The combined statements of operations prior to April 14, 2017 represented the activity of the Predecessor and EPS was not applicable. |
For the Period from April 14, 2017 to December 31, 2017 | ||||
Earnings allocable to common shares: | ||||
Numerator for basic and diluted earnings per share: | ||||
Income (loss) from operations attributable to Safety, Income & Growth Inc. and allocable to common shareholders | $ | (3,669 | ) | |
Net income (loss) | $ | (3,669 | ) | |
Denominator for basic and diluted earnings per share: | ||||
Weighted average common shares outstanding for basic and diluted earnings per common share | 14,648 | |||
Basic and diluted earnings per common share: | ||||
Net income (loss) attributable to Safety, Income & Growth Inc. and allocable to common shareholders | $ | (0.25 | ) |
Manager | SFTY Manager, LLC, a wholly-owned subsidiary of iStar Inc. |
Management Fee | Annual fee of 1.0% of total shareholder's equity (up to $2.5 billion) Annual fee of 0.75% of total shareholder's equity (> $2.5 billion) |
Management Fee Consideration | Payment will be made exclusively in the Company's common stock (valued at the greater of (i) the volume weighted average market price during the quarter for which the fee is being paid or (ii) the initial public offering price) |
Lock-up | Restriction from selling common stock received for management fees for 2 years from the date of such issuance (restriction will terminate in the event of and effective with the termination of the management agreement) |
Management Fee Waiver | No management fee paid to the Manager during the first year (through June 30, 2018) |
Incentive Fee | None |
Term | 1 year |
Renewal Provision | Annual renewal to be approved by majority of independent directors |
Termination Fee | None |
For the Quarter Ended December 31, | For the Quarter Ended September 30, | For the Period from April 14 to June 30, | For the Period from April 1 to April 13, | For the Quarter Ended March 31, | ||||||||||||||||
The Company | Predecessor | |||||||||||||||||||
2017: | ||||||||||||||||||||
Revenue | $ | 6,750 | $ | 6,256 | $ | 4,204 | $ | 691 | $ | 5,333 | ||||||||||
Net income (loss) | $ | (1,344 | ) | $ | (721 | ) | $ | (1,604 | ) | $ | 54 | $ | 1,792 | |||||||
Earnings per common share data(1): | ||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||
Basic and diluted | $ | (0.07 | ) | $ | (0.04 | ) | $ | (0.25 | ) | N/A | N/A | |||||||||
Weighted average number of common shares | ||||||||||||||||||||
Basic and diluted | 18,190 | 18,190 | 6,293 | N/A | N/A | |||||||||||||||
For the Quarters Ended | ||||||||||||||||||||
December 31, | September 30, | June 30, | March 31, | |||||||||||||||||
Predecessor | ||||||||||||||||||||
2016: | ||||||||||||||||||||
Revenue | $ | 7,706 | $ | 4,772 | $ | 4,672 | $ | 4,593 | ||||||||||||
Net income (loss) | $ | 3,699 | $ | 949 | $ | 1,053 | $ | 914 | ||||||||||||
Earnings per common share data(1): | ||||||||||||||||||||
Net income (loss) | ||||||||||||||||||||
Basic and diluted | N/A | N/A | N/A | N/A | ||||||||||||||||
Weighted average number of common shares | ||||||||||||||||||||
Basic and diluted | N/A | N/A | N/A | N/A |
Initial Cost to Company | Cost Capitalized Subsequent to Acquisition | Gross Amount Carried at Close of Period | |||||||||||||||||||||||||||||||||||
Location | Encumbrances | Land | Building and Improvements | Land | Building and Improvements | Total(1) | Accumulated Depreciation | Date Acquired | Depreciable Life (Years) | ||||||||||||||||||||||||||||
Detroit, MI | $ | 31,961 | (2) | $ | 29,086 | $ | — | $ | — | $ | 29,086 | $ | — | $ | 29,086 | $ | — | 2017 | N/A | ||||||||||||||||||
Dallas, TX | 3,736 | (2) | 1,954 | — | — | 1,954 | — | 1,954 | — | 2017 | N/A | ||||||||||||||||||||||||||
Dallas, TX | 4,151 | (2) | 2,751 | — | — | 2,751 | — | 2,751 | — | 2017 | N/A | ||||||||||||||||||||||||||
Atlanta, GA | 7,577 | (2) | 4,097 | — | — | 4,097 | — | 4,097 | — | 2017 | N/A | ||||||||||||||||||||||||||
Milwaukee, WI | 3,633 | (2) | 4,638 | 51,323 | — | 4,638 | 51,323 | 55,961 | 916 | 2017 | 40 | (3) | |||||||||||||||||||||||||
Washington, DC | 5,190 | (2) | 1,484 | — | — | 1,484 | — | 1,484 | — | 2017 | N/A | ||||||||||||||||||||||||||
Minneapolis, MN | 1,452 | (2) | 716 | — | — | 716 | — | 716 | — | 2017 | N/A | ||||||||||||||||||||||||||
Durango, CO | 16,604 | (2) | 1,415 | 17,080 | — | 1,415 | 17,080 | 18,495 | 387 | 2017 | 35 | (3) | |||||||||||||||||||||||||
Rohnert Park, CA | 19,300 | (2) | 5,869 | 13,752 | — | 5,869 | 13,752 | 19,621 | 387 | 2017 | 32 | (3) | |||||||||||||||||||||||||
Salt Lake City, UT | 55,312 | (2) | 8,573 | 40,583 | — | 8,573 | 40,583 | 49,156 | 847 | 2017 | 34 | (3) | |||||||||||||||||||||||||
San Diego, CA | 38,084 | (2) | 5,077 | 24,096 | — | 5,077 | 24,096 | 29,173 | 532 | 2017 | 33 | (3) | |||||||||||||||||||||||||
Seattle, WA | 40,000 | (2) | 7,813 | 45,562 | — | 7,813 | 45,562 | 53,375 | 1,184 | 2017 | 30 | (3) | |||||||||||||||||||||||||
Los Angeles, CA | 36,920 | (4) | 68,140 | — | — | 68,140 | — | 68,140 | — | 2017 | N/A | ||||||||||||||||||||||||||
Los Angeles, CA | 34,080 | (4) | 72,836 | — | — | 72,836 | — | 72,836 | — | 2017 | N/A | ||||||||||||||||||||||||||
Atlanta, GA | — | (5) | 6,300 | — | — | 6,300 | — | 6,300 | — | 2017 | N/A | ||||||||||||||||||||||||||
Total | $ | 298,000 | $ | 220,749 | $ | 192,396 | $ | — | $ | 220,749 | $ | 192,396 | $ | 413,145 | $ | 4,253 |
(1) | The aggregate cost for Federal income tax purposes was approximately $467.9 million at December 31, 2017. |
(2) | Pledged as collateral under the 2017 Secured Financing. |
(3) | These properties have land improvements with depreciable lives from 7 to 12 years. |
(4) | Pledged as collateral under the 2017 Hollywood Mortgage. |
(5) | Pledged as collateral under the 2017 Revolver. |
April 14, 2017 to December 31, 2017 | January 1, 2017 to April 13, 2017 | Year Ended December 31, 2016 | Year Ended December 31, 2015 | |||||||||||||
The Company | The Predecessor | |||||||||||||||
Beginning balance | $ | — | $ | 165,699 | $ | 161,784 | $ | 156,410 | ||||||||
Acquisitions | 413,145 | — | 3,915 | 5,374 | ||||||||||||
Ending balance | $ | 413,145 | $ | 165,699 | $ | 165,699 | $ | 161,784 |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed at their acquisition date fair values. |
April 14, 2017 to December 31, 2017 | January 1, 2017 to April 13, 2017 | Year Ended December 31, 2016 | Year Ended December 31, 2015 | |||||||||||||
The Company | The Predecessor | |||||||||||||||
Beginning balance | $ | — | $ | 61,221 | $ | 58,104 | $ | 54,987 | ||||||||
Additions | 4,253 | 894 | 3,117 | 3,117 | ||||||||||||
Ending balance | $ | 4,253 | $ | 62,115 | $ | 61,221 | $ | 58,104 |
(1) | On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. As a result, the Company recorded the assets acquired and liabilities assumed at their acquisition date fair values. |
(a) | and (c) Financial statements and schedule—see Index to Financial Statements and Schedule included in Item 8. |
(b) | Exhibits—see index on following page. |
Exhibit Number | Document Description | |
23.1* | ||
31.0* | ||
32.0* | ||
100* | XBRL-related documents | |
101 | Interactive data file |
Safety, Income & Growth Inc. Registrant | ||
Date: | October 10, 2018 | /s/ JAY SUGARMAN |
Jay Sugarman Chairman of the Board of Directors and Chief Executive Officer (principal executive officer) | ||
Safety, Income & Growth Inc. Registrant | ||
Date: | October 10, 2018 | /s/ ANDREW C. RICHARDSON |
Andrew C. Richardson Chief Financial Officer (principal financial and accounting officer) |
Date: | October 10, 2018 | /s/ JAY SUGARMAN |
Jay Sugarman Chairman of the Board of Directors Chief Executive Officer | ||
Date: | October 10, 2018 | By: | /s/ JAY SUGARMAN | |||
Name: | Jay Sugarman | |||||
Title: | Chief Executive Officer |
Date: | October 10, 2018 | By: | /s/ ANDREW C. RICHARDSON | |||
Name: | Andrew C. Richardson | |||||
Title: | Chief Financial Officer (principal financial and accounting officer) |
Date: | October 10, 2018 | By: | /s/ JAY SUGARMAN | |||
Name: | Jay Sugarman | |||||
Title: | Chief Executive Officer |
Date: | October 10, 2018 | By: | /s/ ANDREW C. RICHARDSON | |||
Name: | Andrew C. Richardson | |||||
Title: | Chief Financial Officer (principal financial and accounting officer) |
Document and Entity Information - USD ($) $ in Millions |
12 Months Ended | ||
---|---|---|---|
Dec. 31, 2017 |
Feb. 15, 2018 |
Jun. 30, 2017 |
|
Document and Entity Information [Abstract] | |||
Entity Registrant Name | Safety, Income & Growth, Inc. | ||
Entity Central Index Key | 0001688852 | ||
Document Type | 10-K/A | ||
Document Period End Date | Dec. 31, 2017 | ||
Amendment Flag | true | ||
Amendment Description | The Company is filing this Amendment No. 1 to the 2017 Annual Report in order to replace the audit reports of the predecessor firm with Deloitte's audit report on the financial statements included in the 2017 Annual Report and the June 8-K. | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Filer Category | Non-accelerated Filer | ||
Entity Common Stock, Shares Outstanding | 18,190,000 | ||
Document Fiscal Year Focus | 2017 | ||
Document Fiscal Period Focus | FY | ||
Entity Well-known Seasoned Issuer | No | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 249.5 |
Consolidated and Combined Statements of Operations - USD ($) shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 13, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
||||||||||||
Costs and expenses: | |||||||||||||||
Net income (loss) | [1] | $ 1,846 | $ 6,615 | $ 5,349 | |||||||||||
Net income (loss) attributable to Safety, Income & Growth Inc. | $ (3,669) | ||||||||||||||
Per common share data: | |||||||||||||||
Net income (loss) Basic and diluted (in dollars per share) | $ (0.25) | ||||||||||||||
Weighted average number of common shares: | |||||||||||||||
Weighted average number of common shares: Basic and diluted (in shares) | 14,648 | ||||||||||||||
Tenant reimbursements | 200 | $ 200 | |||||||||||||
Amortization of above and below market leases assets | 700 | ||||||||||||||
The Company | |||||||||||||||
Revenues: | |||||||||||||||
Ground and other lease income | 16,952 | ||||||||||||||
Other income | 258 | ||||||||||||||
Total revenues | 17,210 | ||||||||||||||
Costs and expenses: | |||||||||||||||
Interest expense | 7,485 | ||||||||||||||
Real estate expense | [2] | 1,261 | |||||||||||||
Depreciation and amortization | 6,406 | ||||||||||||||
General and administrative | 5,094 | ||||||||||||||
Other expense | 633 | ||||||||||||||
Total costs and expenses | 20,879 | ||||||||||||||
Income (loss) from operations | (3,669) | ||||||||||||||
Income from sales of real estate | 0 | ||||||||||||||
Net income (loss) | (3,669) | ||||||||||||||
Net income attributable to noncontrolling interest | 0 | ||||||||||||||
Net income (loss) attributable to Safety, Income & Growth Inc. | $ (3,669) | ||||||||||||||
Per common share data: | |||||||||||||||
Net income (loss) Basic and diluted (in dollars per share) | $ (0.25) | ||||||||||||||
Weighted average number of common shares: | |||||||||||||||
Weighted average number of common shares: Basic and diluted (in shares) | 14,648 | ||||||||||||||
Amortization of above and below market leases assets | $ 1,178 | ||||||||||||||
Predecessor | |||||||||||||||
Revenues: | |||||||||||||||
Ground and other lease income | [3] | 5,916 | 21,664 | 18,558 | |||||||||||
Other income | [3] | 108 | 79 | 7 | |||||||||||
Total revenues | [3] | 6,024 | 21,743 | 18,565 | |||||||||||
Costs and expenses: | |||||||||||||||
Interest expense | [3] | 2,432 | 8,242 | 7,229 | |||||||||||
Real estate expense | [2],[3] | 210 | 861 | 217 | |||||||||||
Depreciation and amortization | [3],[4] | 901 | 3,142 | 3,140 | |||||||||||
General and administrative | [3] | 1,143 | 2,883 | 2,262 | |||||||||||
Other expense | [3] | 0 | 0 | 0 | |||||||||||
Total costs and expenses | [3] | 4,686 | 15,128 | 12,848 | |||||||||||
Income (loss) from operations | [3] | 1,338 | 6,615 | 5,717 | |||||||||||
Income from sales of real estate | [3] | 508 | 0 | 0 | |||||||||||
Net income (loss) | [1],[3],[4],[5] | 1,846 | 6,615 | 5,717 | |||||||||||
Net income attributable to noncontrolling interest | [3] | 0 | 0 | (368) | |||||||||||
Net income (loss) attributable to Safety, Income & Growth Inc. | [3] | 1,846 | 6,615 | 5,349 | |||||||||||
Weighted average number of common shares: | |||||||||||||||
Amortization of above and below market leases assets | [4] | $ 118 | $ 414 | $ 332 | |||||||||||
|
Consolidated and Combined Balance Sheets (Parenthetical) - $ / shares |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Common stock, shares outstanding (in shares) | 18,190,000 | |
The Company | ||
Common stock, par value (in dollars per share) | $ 0.01 | |
Common stock, shares authorized (in shares) | 400,000,000 | |
Common stock, shares issued (in shares) | 18,190,000 | |
Common stock, shares outstanding (in shares) | 18,190,000 | |
Predecessor | ||
Common stock, par value (in dollars per share) | ||
Common stock, shares authorized (in shares) | ||
Common stock, shares issued (in shares) | ||
Common stock, shares outstanding (in shares) |
Consolidated and Combined Statements of Comprehensive Income - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 13, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
||||||||||
Net income (loss) | [1] | $ 1,846 | $ 6,615 | $ 5,349 | |||||||||
Other comprehensive income (loss): | |||||||||||||
Unrealized gains/(losses) on derivatives | $ 100 | ||||||||||||
The Company | |||||||||||||
Net income (loss) | (3,669) | ||||||||||||
Other comprehensive income (loss): | |||||||||||||
Reclassification of (gains) losses on derivatives into earnings | 110 | ||||||||||||
Unrealized gains/(losses) on derivatives | (30) | ||||||||||||
Other comprehensive income (loss) | 80 | ||||||||||||
Comprehensive income (loss) | (3,589) | ||||||||||||
Comprehensive (income) loss attributable to noncontrolling interests | 0 | ||||||||||||
Comprehensive income (loss) attributable to Safety, Income & Growth Inc. | $ (3,589) | ||||||||||||
Predecessor | |||||||||||||
Net income (loss) | [1],[2],[3],[4] | 1,846 | 6,615 | 5,717 | |||||||||
Other comprehensive income (loss): | |||||||||||||
Reclassification of (gains) losses on derivatives into earnings | [3] | 0 | 0 | 0 | |||||||||
Unrealized gains/(losses) on derivatives | [3] | 415 | 0 | 0 | |||||||||
Other comprehensive income (loss) | [3] | 415 | 0 | 0 | |||||||||
Comprehensive income (loss) | [3] | 2,261 | 6,615 | 5,717 | |||||||||
Comprehensive (income) loss attributable to noncontrolling interests | [3] | 0 | 0 | (368) | |||||||||
Comprehensive income (loss) attributable to Safety, Income & Growth Inc. | [3] | $ 2,261 | $ 6,615 | $ 5,349 | |||||||||
|
Consolidated and Combined Statements of Cash Flows - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | ||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 13, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
||||||||||
Cash flows from operating activities: | |||||||||||||
Net income (loss) | [1] | $ 1,846 | $ 6,615 | $ 5,349 | |||||||||
Adjustments to reconcile net income (loss) to cash flows from operating activities: | |||||||||||||
Amortization of real estate-related intangibles, net | $ 700 | ||||||||||||
The Company | |||||||||||||
Cash flows from operating activities: | |||||||||||||
Net income (loss) | (3,669) | ||||||||||||
Adjustments to reconcile net income (loss) to cash flows from operating activities: | |||||||||||||
Depreciation and amortization | 6,406 | ||||||||||||
Non-cash expense for stock-based compensation | 766 | ||||||||||||
Deferred ground and other lease income | (4,097) | ||||||||||||
Income from sales of real estate | 0 | ||||||||||||
Amortization of real estate-related intangibles, net | 1,178 | ||||||||||||
Amortization of premium and deferred financing costs on debt obligations, net | 465 | ||||||||||||
Management fees and non-cash expense reimbursements to the Manager | 2,627 | ||||||||||||
Other operating activities | 15 | ||||||||||||
Changes in assets and liabilities: | |||||||||||||
Changes in ground and other lease income receivable, net | 1,394 | ||||||||||||
Changes in deferred expenses and other assets, net | 151 | ||||||||||||
Changes in accounts payable, accrued expenses and other liabilities | 852 | ||||||||||||
Cash flows provided by operating activities | 6,088 | ||||||||||||
Cash flows from investing activities: | |||||||||||||
Acquisitions of real estate | (270,734) | ||||||||||||
Proceeds from sales of real estate | 0 | ||||||||||||
Other investing activities | (2,443) | ||||||||||||
Cash flows used in investing activities | (273,177) | ||||||||||||
Cash flows from financing activities: | |||||||||||||
Net transactions with iStar Inc. | 0 | ||||||||||||
Distributions to noncontrolling interest | 0 | ||||||||||||
Contributions from noncontrolling interest | 0 | ||||||||||||
Contribution from iStar Inc. | 14,350 | ||||||||||||
Proceeds from issuance of common stock | 363,000 | ||||||||||||
Proceeds from debt obligations | 176,000 | ||||||||||||
Repayments of debt obligations | (95,000) | ||||||||||||
Payments for deferred financing costs | (4,170) | ||||||||||||
Payment of offering costs | (14,372) | ||||||||||||
Dividends paid to common shareholders | (2,849) | ||||||||||||
Cash flows provided by (used in) financing activities | 436,959 | ||||||||||||
Changes in cash, cash equivalents and restricted cash | 169,870 | ||||||||||||
Cash, cash equivalents and restricted cash at beginning of period | 0 | ||||||||||||
Cash, cash equivalents and restricted cash at end of period | 0 | 169,870 | |||||||||||
Supplemental disclosure of cash flow information: | |||||||||||||
Cash paid for interest | 6,528 | ||||||||||||
Supplemental disclosure of non-cash investing and financing activity: | |||||||||||||
Assumption of debt obligations | 227,415 | ||||||||||||
Contribution from iStar Inc. | 7,217 | ||||||||||||
Dividends declared to common shareholders | 2,728 | ||||||||||||
Accrued offering costs | 1,347 | ||||||||||||
Accrued finance costs | 128 | ||||||||||||
Contribution from noncontrolling interest | 0 | ||||||||||||
Net transactions with iStar Inc. | 0 | ||||||||||||
Predecessor | |||||||||||||
Cash flows from operating activities: | |||||||||||||
Net income (loss) | [1],[2],[3],[4] | 1,846 | 6,615 | 5,717 | |||||||||
Adjustments to reconcile net income (loss) to cash flows from operating activities: | |||||||||||||
Depreciation and amortization | [2],[4] | 901 | 3,142 | 3,140 | |||||||||
Non-cash expense for stock-based compensation | [2] | 0 | 0 | 0 | |||||||||
Deferred ground and other lease income | [2] | (1,271) | (4,374) | (2,902) | |||||||||
Income from sales of real estate | [2] | (508) | 0 | 0 | |||||||||
Amortization of real estate-related intangibles, net | [2] | 118 | 414 | 332 | |||||||||
Amortization of premium and deferred financing costs on debt obligations, net | [2] | 0 | 0 | 0 | |||||||||
Management fees and non-cash expense reimbursements to the Manager | [2] | 0 | 0 | 0 | |||||||||
Other operating activities | [2] | 24 | 0 | 0 | |||||||||
Changes in assets and liabilities: | |||||||||||||
Changes in ground and other lease income receivable, net | [2] | 2,088 | (858) | (588) | |||||||||
Changes in deferred expenses and other assets, net | [2] | (576) | (39) | (430) | |||||||||
Changes in accounts payable, accrued expenses and other liabilities | [2] | (13) | 580 | (244) | |||||||||
Cash flows provided by operating activities | [2] | 2,609 | 5,480 | 5,025 | |||||||||
Cash flows from investing activities: | |||||||||||||
Acquisitions of real estate | [2] | 0 | (3,915) | 0 | |||||||||
Proceeds from sales of real estate | [2] | 508 | 0 | 0 | |||||||||
Other investing activities | [2] | (1,042) | (4,057) | 0 | |||||||||
Cash flows used in investing activities | [2] | (534) | (7,972) | 0 | |||||||||
Cash flows from financing activities: | |||||||||||||
Net transactions with iStar Inc. | [2] | (220,813) | 3,447 | 1,943 | |||||||||
Distributions to noncontrolling interest | [2] | 0 | 0 | (594) | |||||||||
Contributions from noncontrolling interest | [2] | 0 | 0 | (6,352) | |||||||||
Contribution from iStar Inc. | [2] | 0 | 0 | 0 | |||||||||
Proceeds from issuance of common stock | [2] | 0 | 0 | 0 | |||||||||
Proceeds from debt obligations | [2] | 227,000 | 0 | 0 | |||||||||
Repayments of debt obligations | [2] | 0 | 0 | 0 | |||||||||
Payments for deferred financing costs | [2] | (7,217) | 0 | 0 | |||||||||
Payment of offering costs | [2] | (779) | (977) | 0 | |||||||||
Dividends paid to common shareholders | [2] | 0 | 0 | 0 | |||||||||
Cash flows provided by (used in) financing activities | [2] | (1,809) | 2,470 | (5,003) | |||||||||
Changes in cash, cash equivalents and restricted cash | 266 | (22) | 22 | ||||||||||
Cash, cash equivalents and restricted cash at beginning of period | 0 | $ 266 | 22 | 0 | |||||||||
Cash, cash equivalents and restricted cash at end of period | 266 | 0 | 22 | ||||||||||
Supplemental disclosure of cash flow information: | |||||||||||||
Cash paid for interest | [2] | 168 | 0 | 0 | |||||||||
Supplemental disclosure of non-cash investing and financing activity: | |||||||||||||
Assumption of debt obligations | [2] | 0 | 0 | 0 | |||||||||
Contribution from iStar Inc. | [2] | 0 | 0 | 0 | |||||||||
Dividends declared to common shareholders | 0 | 0 | 0 | ||||||||||
Accrued offering costs | [2] | 0 | 769 | 0 | |||||||||
Accrued finance costs | [2] | 21 | 0 | 0 | |||||||||
Contribution from noncontrolling interest | [2] | 0 | 0 | 3,819 | |||||||||
Net transactions with iStar Inc. | [2] | $ 0 | $ 0 | $ 34,372 | |||||||||
|
Business and Organization |
12 Months Ended |
---|---|
Dec. 31, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Principles of Consolidation and Combination | Business and Organization Business—Safety, Income & Growth Inc. (the "Company") operates its business through one segment by acquiring, managing and capitalizing ground leases. Ground leases are long-term contracts between the landlord (the Company) and a tenant or leaseholder ("Ground Leases"). The Company believes that it is the first publicly-traded company formed primarily to acquire, own, manage, finance and capitalize Ground Leases. Ground Leases generally represent ownership of the land underlying commercial real estate projects that is net leased by the fee owner of the land to the owners/operators of the real estate projects built thereon. Ground Leases are similar to ‘‘triple net’’ leases in that the tenant is responsible for all property operating expenses, such as maintenance, real estate taxes and insurance and is typically responsible for development costs and capital expenditures. Ground Leases are typically long-term (base terms ranging from 30 years to 99 years, often with tenant renewal options) and have contractual base rent increases (either at a specified percentage or consumer price index ("CPI") based, or both) and sometimes include percentage rent participations. The Company intends to target investments in long-term Ground Leases in which: (i) the initial value of its Ground Lease represents 30% to 45% of the combined value of the land and buildings and improvements thereon as if there was no Ground Lease on the land ("Combined Property Value"); (ii) the ratio of underlying property net operating income to the Ground Lease payment due the Company ("Ground Rent Coverage") is between 2.0x to 5.0x; and (iii) the Ground Lease contains contractual rent escalation clauses or percentage rent that participates in gross revenues generated by the commercial real estate on the land. A Ground Lease lessor (the Company) typically has the right to regain possession of its land and take ownership of the buildings and improvements thereon upon a tenant default. The Company believes that the Ground Lease structure provides an opportunity for future investment value accretion through the reversion to the Company, as the Ground Lease owner, of the buildings and improvements on the land at the expiration or earlier termination of the lease, for no additional consideration from the Company. The Company is managed by SFTY Manager, LLC (the "Manager"), a wholly-owned subsidiary of iStar Inc. ("iStar"), the Company's largest shareholder, pursuant to a management agreement (refer to Note 11). The Company has no employees, as the Manager provides all services to it. The Company intends to draw on the extensive investment origination and sourcing platform of its Manager to actively promote the benefits of the Ground Lease structure to prospective Ground Lease tenants. Organization—Safety, Income & Growth Inc. is a Maryland corporation. The Company closed its initial public offering in June 2017 and its common stock is listed on the New York Stock Exchange under the symbol "SAFE." The Company's predecessor ("Original Safety" or the "Predecessor") was formed as a wholly-owned subsidiary of iStar on October 24, 2016. iStar contributed a pre-existing portfolio of Ground Leases to Original Safety and sought third party capital to grow its Ground Lease business. A second entity, SIGI Acquisition, Inc. ("SIGI"), was capitalized on April 14, 2017 by iStar and two institutional investors. On April 14, 2017, Original Safety merged with and into SIGI with SIGI surviving the merger and being renamed Safety, Income & Growth Inc. References herein to the Company refer to Original Safety before such merger and to the surviving company of such merger thereafter. Through these and other formation transactions, the Company (i) acquired iStar's entire Ground Lease portfolio consisting of 12 properties (the "Initial Portfolio"), all of which were wholly-owned by the Company as of December 31, 2016, (ii) completed the $227 million 2017 Secured Financing (refer to Note 6) on March 30, 2017, (iii) issued 2,875,000 shares of the Company's common stock to two institutional investors for $20.00 per share, or $57.5 million (representing a 51% ownership interest in the Company at such time), and 2,775,000 shares of the Company's common stock to iStar for $20.00 per share, or $55.5 million (representing a 49% ownership interest in the Company at such time), and (iv) paid $340.0 million in total consideration to iStar for the Initial Portfolio. On June 27, 2017, the Company completed its initial public offering raising $205.0 million in gross proceeds and concurrently completed a $45.0 million private placement with iStar, its largest shareholder. The price per share paid in the initial public offering and the private placement was $20.00. iStar incurred a total of $18.9 million of organization and offering costs in connection with these transactions, including commissions payable to the underwriters and other offering expenses. iStar received no reimbursement for its payment of the organization and offering costs. The payment of such costs were treated as capital contributions from iStar with an offsetting cost of capital in the Company's consolidated statements of changes in equity. The Company intends to elect to qualify as a real estate investment trust ("REIT") for U.S. federal income tax purposes, commencing with the tax year ending December 31, 2017. The Company was structured as an Umbrella Partnership REIT ("UPREIT"). As such, all of the Company's properties are owned by a subsidiary partnership, Safety Income and Growth Operating Partnership LP (the "Operating Partnership"), which is currently wholly-owned by the Company. The UPREIT structure may afford the Company with certain benefits as it seeks to acquire properties from third parties who may want to defer taxes by contributing their Ground Leases to the Company. Basis of Presentation and Principles of Consolidation and Combination Basis of Presentation—For periods prior to April 14, 2017, the accompanying combined financial statements do not represent the financial position and results of operations of one legal entity, but rather a combination of entities under common control that have been ‘‘carved out’’ from iStar’s consolidated financial statements. For periods prior to April 14, 2017, these combined financial statements reflect the revenues and expenses of the Predecessor and include certain material assets and liabilities of iStar that are specifically identifiable and generated through, or associated with, an in-place lease, which have been reflected at iStar’s historical basis. For periods subsequent to April 14, 2017, the accompanying consolidated financial statements represent the consolidated financial statements of the Company. In addition, as a result of the Company's acquisition of the Initial Portfolio from iStar, the consolidated financial statements subsequent to April 14, 2017 are presented on a new basis of accounting pursuant to Accounting Standards Codification ("ASC") 805 (refer to Note 4). The preparation of these consolidated and combined financial statements in conformity with generally accepted accounting principles in the United States of America (‘‘GAAP’’) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These combined financial statements for the periods prior to April 14, 2017 include an allocation of general and administrative expenses and interest expense to the Predecessor from iStar. General and administrative expenses include certain iStar corporate functions, including executive oversight, treasury, finance, human resources, tax compliance and planning, internal audit, financial reporting, information technology and investor relations. General and administrative expenses, including stock based compensation, represent a pro rata allocation of costs from iStar’s net lease and corporate business segments based on our average net assets as a percentage of iStar’s average net assets. Interest expense was allocated to the Predecessor by calculating its average net assets as a percentage of the average net assets in iStar’s net lease business segment and multiplying that percentage by the interest expense allocated to iStar’s net lease business segment (only for the number of days in the period in which the Predecessor did not have debt obligations outstanding—refer to Note 6). The Company believes the allocation methodology for the general and administrative expenses and interest expense is reasonable. Accordingly, the general and administrative expense allocation presented in our combined statements of operations for Predecessor periods does not necessarily reflect what our general and administrative expenses will be as a standalone public company for future reporting periods. For the periods prior to April 14, 2017, most of the entities included in the Predecessor financial statements did not have bank accounts for the periods presented, and most cash transactions for the Predecessor were transacted through bank accounts owned by iStar. For the periods prior to April 14, 2017, the combined statements of cash flows for the periods presented were prepared as if operating, investing and financing transactions for the Predecessor had been transacted through its own bank accounts. Certain prior period amounts have been reclassified in the Company's consolidated financial statements and the related notes to conform to the current period presentation. Principles of Consolidation and Combination—For the periods prior to April 14, 2017, the combined financial statements include on a carve-out basis the historical balance sheets and statements of operations and cash flows attributed to the Predecessor. For the periods subsequent to April 14, 2017, the consolidated financial statements include the accounts and operations of the Company and its consolidated subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. |
Basis of Presentation and Principles of Consolidation and Combination |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Principles of Consolidation and Combination | Business and Organization Business—Safety, Income & Growth Inc. (the "Company") operates its business through one segment by acquiring, managing and capitalizing ground leases. Ground leases are long-term contracts between the landlord (the Company) and a tenant or leaseholder ("Ground Leases"). The Company believes that it is the first publicly-traded company formed primarily to acquire, own, manage, finance and capitalize Ground Leases. Ground Leases generally represent ownership of the land underlying commercial real estate projects that is net leased by the fee owner of the land to the owners/operators of the real estate projects built thereon. Ground Leases are similar to ‘‘triple net’’ leases in that the tenant is responsible for all property operating expenses, such as maintenance, real estate taxes and insurance and is typically responsible for development costs and capital expenditures. Ground Leases are typically long-term (base terms ranging from 30 years to 99 years, often with tenant renewal options) and have contractual base rent increases (either at a specified percentage or consumer price index ("CPI") based, or both) and sometimes include percentage rent participations. The Company intends to target investments in long-term Ground Leases in which: (i) the initial value of its Ground Lease represents 30% to 45% of the combined value of the land and buildings and improvements thereon as if there was no Ground Lease on the land ("Combined Property Value"); (ii) the ratio of underlying property net operating income to the Ground Lease payment due the Company ("Ground Rent Coverage") is between 2.0x to 5.0x; and (iii) the Ground Lease contains contractual rent escalation clauses or percentage rent that participates in gross revenues generated by the commercial real estate on the land. A Ground Lease lessor (the Company) typically has the right to regain possession of its land and take ownership of the buildings and improvements thereon upon a tenant default. The Company believes that the Ground Lease structure provides an opportunity for future investment value accretion through the reversion to the Company, as the Ground Lease owner, of the buildings and improvements on the land at the expiration or earlier termination of the lease, for no additional consideration from the Company. The Company is managed by SFTY Manager, LLC (the "Manager"), a wholly-owned subsidiary of iStar Inc. ("iStar"), the Company's largest shareholder, pursuant to a management agreement (refer to Note 11). The Company has no employees, as the Manager provides all services to it. The Company intends to draw on the extensive investment origination and sourcing platform of its Manager to actively promote the benefits of the Ground Lease structure to prospective Ground Lease tenants. Organization—Safety, Income & Growth Inc. is a Maryland corporation. The Company closed its initial public offering in June 2017 and its common stock is listed on the New York Stock Exchange under the symbol "SAFE." The Company's predecessor ("Original Safety" or the "Predecessor") was formed as a wholly-owned subsidiary of iStar on October 24, 2016. iStar contributed a pre-existing portfolio of Ground Leases to Original Safety and sought third party capital to grow its Ground Lease business. A second entity, SIGI Acquisition, Inc. ("SIGI"), was capitalized on April 14, 2017 by iStar and two institutional investors. On April 14, 2017, Original Safety merged with and into SIGI with SIGI surviving the merger and being renamed Safety, Income & Growth Inc. References herein to the Company refer to Original Safety before such merger and to the surviving company of such merger thereafter. Through these and other formation transactions, the Company (i) acquired iStar's entire Ground Lease portfolio consisting of 12 properties (the "Initial Portfolio"), all of which were wholly-owned by the Company as of December 31, 2016, (ii) completed the $227 million 2017 Secured Financing (refer to Note 6) on March 30, 2017, (iii) issued 2,875,000 shares of the Company's common stock to two institutional investors for $20.00 per share, or $57.5 million (representing a 51% ownership interest in the Company at such time), and 2,775,000 shares of the Company's common stock to iStar for $20.00 per share, or $55.5 million (representing a 49% ownership interest in the Company at such time), and (iv) paid $340.0 million in total consideration to iStar for the Initial Portfolio. On June 27, 2017, the Company completed its initial public offering raising $205.0 million in gross proceeds and concurrently completed a $45.0 million private placement with iStar, its largest shareholder. The price per share paid in the initial public offering and the private placement was $20.00. iStar incurred a total of $18.9 million of organization and offering costs in connection with these transactions, including commissions payable to the underwriters and other offering expenses. iStar received no reimbursement for its payment of the organization and offering costs. The payment of such costs were treated as capital contributions from iStar with an offsetting cost of capital in the Company's consolidated statements of changes in equity. The Company intends to elect to qualify as a real estate investment trust ("REIT") for U.S. federal income tax purposes, commencing with the tax year ending December 31, 2017. The Company was structured as an Umbrella Partnership REIT ("UPREIT"). As such, all of the Company's properties are owned by a subsidiary partnership, Safety Income and Growth Operating Partnership LP (the "Operating Partnership"), which is currently wholly-owned by the Company. The UPREIT structure may afford the Company with certain benefits as it seeks to acquire properties from third parties who may want to defer taxes by contributing their Ground Leases to the Company. Basis of Presentation and Principles of Consolidation and Combination Basis of Presentation—For periods prior to April 14, 2017, the accompanying combined financial statements do not represent the financial position and results of operations of one legal entity, but rather a combination of entities under common control that have been ‘‘carved out’’ from iStar’s consolidated financial statements. For periods prior to April 14, 2017, these combined financial statements reflect the revenues and expenses of the Predecessor and include certain material assets and liabilities of iStar that are specifically identifiable and generated through, or associated with, an in-place lease, which have been reflected at iStar’s historical basis. For periods subsequent to April 14, 2017, the accompanying consolidated financial statements represent the consolidated financial statements of the Company. In addition, as a result of the Company's acquisition of the Initial Portfolio from iStar, the consolidated financial statements subsequent to April 14, 2017 are presented on a new basis of accounting pursuant to Accounting Standards Codification ("ASC") 805 (refer to Note 4). The preparation of these consolidated and combined financial statements in conformity with generally accepted accounting principles in the United States of America (‘‘GAAP’’) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These combined financial statements for the periods prior to April 14, 2017 include an allocation of general and administrative expenses and interest expense to the Predecessor from iStar. General and administrative expenses include certain iStar corporate functions, including executive oversight, treasury, finance, human resources, tax compliance and planning, internal audit, financial reporting, information technology and investor relations. General and administrative expenses, including stock based compensation, represent a pro rata allocation of costs from iStar’s net lease and corporate business segments based on our average net assets as a percentage of iStar’s average net assets. Interest expense was allocated to the Predecessor by calculating its average net assets as a percentage of the average net assets in iStar’s net lease business segment and multiplying that percentage by the interest expense allocated to iStar’s net lease business segment (only for the number of days in the period in which the Predecessor did not have debt obligations outstanding—refer to Note 6). The Company believes the allocation methodology for the general and administrative expenses and interest expense is reasonable. Accordingly, the general and administrative expense allocation presented in our combined statements of operations for Predecessor periods does not necessarily reflect what our general and administrative expenses will be as a standalone public company for future reporting periods. For the periods prior to April 14, 2017, most of the entities included in the Predecessor financial statements did not have bank accounts for the periods presented, and most cash transactions for the Predecessor were transacted through bank accounts owned by iStar. For the periods prior to April 14, 2017, the combined statements of cash flows for the periods presented were prepared as if operating, investing and financing transactions for the Predecessor had been transacted through its own bank accounts. Certain prior period amounts have been reclassified in the Company's consolidated financial statements and the related notes to conform to the current period presentation. Principles of Consolidation and Combination—For the periods prior to April 14, 2017, the combined financial statements include on a carve-out basis the historical balance sheets and statements of operations and cash flows attributed to the Predecessor. For the periods subsequent to April 14, 2017, the consolidated financial statements include the accounts and operations of the Company and its consolidated subsidiaries. All significant intercompany balances and transactions have been eliminated in consolidation. |
Summary of Significant Accounting Policies |
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Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Real estate—Real estate assets are recorded at cost less accumulated depreciation and amortization, as follows: Capitalization and depreciation—Certain improvements and replacements are capitalized when they extend the useful life of the asset. Repair and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful life, which is generally 40 years for facilities, the shorter of the remaining lease term or expected life for tenant improvements and the remaining useful life of the facility for facility improvements. Purchase price allocation—Upon acquisition of real estate, the Company determines whether the transaction is a business combination, which is accounted for under the acquisition method, or an acquisition of assets. For both types of transactions, the Company recognizes and measures identifiable assets acquired, liabilities assumed and any noncontrolling interest in the acquiree based on their relative fair values. For business combinations, the Company recognizes and measures goodwill or gain from a bargain purchase, if applicable, and expenses acquisition-related costs in the periods in which the costs are incurred. For acquisitions of assets, acquisition-related costs are capitalized and recorded in "Real estate, net" on the Company's combined balance sheets. If the Company acquires real estate and simultaneously enters into a new lease of the real estate the acquisition will be accounted for as an asset acquisition. The Company accounts for its acquisition of properties by recording the purchase price of tangible and intangible assets and liabilities acquired based on their estimated fair values. The value of the tangible assets, consisting of land, buildings, building improvements and tenant improvements is determined as if these assets are vacant. Intangible assets may include the value of lease incentive assets, above-market leases, below-market Ground Lease assets and in-place leases, which are each recorded at their estimated fair values and included in "Real estate-related intangible assets, net" on the Company's consolidated and combined balance sheets. Intangible liabilities may include the value of below-market leases, which are recorded at their estimated fair values and included in "Real estate-related intangible liabilities, net" on the Company's consolidated and combined balance sheets. In-place leases are amortized over the remaining non-cancelable term and the amortization expense is included in "Depreciation and amortization" in the Company's consolidated and combined statements of operations. Lease incentive assets and above-market (or below-market) lease value are amortized as a reduction of (or, increase to) ground and other lease income over the remaining non-cancelable term of each lease. Below-market Ground Lease assets are amortized to real state estate expense over the remaining non-cancelable term of the lease. The Company may also engage in sale/leaseback transactions whereby the Company executes a net lease with the occupant simultaneously with the purchase of the asset. Impairments—The Company reviews real estate assets for impairment in value whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. The value of a long-lived asset held for use is impaired if management's estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the asset (taking into account the anticipated holding period of the asset) are less than its carrying value. Such estimate of cash flows considers factors such as expected future operating income trends, as well as the effects of demand, competition and other economic factors. To the extent impairment has occurred, the loss will be measured as the excess of the carrying amount of the asset over the estimated fair value of the asset and reflected as an adjustment to the basis of the asset. Impairments of real estate assets are recorded in "Impairment of assets" in the Company's combined statements of operations. The Company did not record any impairments for the periods presented. Cash and cash equivalents—Cash and cash equivalents include cash held in banks or invested in money market funds, if applicable, with original maturity terms of less than 90 days. Restricted Cash—Restricted cash includes $1.7 million required to be maintained under certain of the Company's derivative transactions. Ground and other lease income—Ground and other lease income includes rent earned from leasing land and buildings owned by the Company to its tenants. Ground and other lease income is recognized on the straight-line method of accounting, generally from the later of the date the lessee takes possession of the space and it is ready for its intended use or the date of acquisition of the asset subject to existing leases. Accordingly, contractual lease payment increases are recognized evenly over the term of the lease. The periodic difference between ground and other lease income recognized under this method and contractual lease payment terms is recorded as deferred ground and other lease income receivable and is included in ‘‘Deferred ground and other lease income receivable, net’’ on the Company's consolidated and combined balance sheets. The Company is also entitled to percentage rent pursuant to some of its leases and records percentage rent as ground and other lease income when earned. During the periods from January 1, 2017 to April 13, 2017 and April 14, 2017 to December 31, 2017, the Company recorded $0.6 million and $0.1 million, respectively, of percentage rent. During the years ended December 31, 2016 and 2015, the Company recorded $3.2 million and $2.9 million, respectively, of percentage rent. Ground and other lease income also includes the amortization of finite lived intangible assets and liabilities, which are amortized over the period during which the assets or liabilities are expected to contribute directly or indirectly to the future cash flows of the business acquired. The Company estimates losses within ground and other lease income receivable and deferred ground and other lease income receivable balances as of the balance sheet date and incorporates an asset-specific reserve based on management's evaluation of the credit risks associated with these receivables. As of December 31, 2017 and 2016, we did not have an allowance for doubtful accounts related to real estate tenant receivables or deferred ground and other lease income. Other income—Other income primarily includes interest income, non-recurring lease termination fees and other ancillary income. Interest income on other assets is recognized on an accrual basis using the effective interest method. The Company considers receivables to be non-performing and places receivables on non-accrual status at such time as: (1) the receivable becomes 90 days delinquent; (2) the receivable has a maturity default; or (3) management determines it is probable that it will be unable to collect all amounts due according to the contractual terms of the receivable. Earnings per share—The Company has one class of common stock. Earnings per share ("EPS") is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding (refer to Note 9 for a summary of shares outstanding). Deferred expenses and other assets—Deferred expenses include deferred financing fees associated with the 2017 Revolver (refer to Note 6), derivative assets, purchase deposits, leasing costs such as brokerage, legal and other costs which are amortized over the life of the respective leases and presented as an operating activity in the Company's consolidated and combined statements of cash flows. Amortization of leasing costs is included in "Depreciation and amortization" in the Company's consolidated and combined statements of operations. As of December 31, 2016, other assets primarily includes a receivable related to the funding provided to a certain investment in a Ground Lease. This receivable is classified as held-for-investment and is reported at its outstanding unpaid principal balance and includes accrued and paid-in-kind interest. Deferred financing fees—Deferred financing fees associated with the 2017 Revolver (refer to Note 6) are recorded in ‘‘Deferred expenses and other assets, net’’ on the Company’s consolidated and combined balance sheets. Deferred financing fees associated with the Company's other facilities are recorded in ‘‘Debt obligations, net’’ on the Company's consolidated and combined balance sheets. The amortization of deferred financing fees is included in ‘‘Interest expense’’ in the Company’s consolidated and combined statements of operations. Dispositions—Gains on the sale of real estate assets are recognized in "Income from sales of real estate" in accordance with ASC 360-20, Real Estate Sales. Gains on sales of real estate are recognized for full profit recognition upon closing of the sale transactions, when the profit is determinable, the earnings process is virtually complete, the parties are bound by the terms of the contract, all consideration has been exchanged, any permanent financing for which the seller is responsible has been arranged and all conditions for closing have been performed. The Company primarily uses specific identification and the relative sales value method to allocate costs. Stock-based compensation—The Company adopted an equity incentive plan to provide equity incentive opportunities to members of the Manager’s management team and employees who perform services for the Company, the Company's independent directors, advisers, consultants and other personnel. The Company's equity incentive plan provides for grants of stock options, shares of restricted common stock, phantom shares, dividend equivalent rights and other equity-based awards, including long-term incentive plan units. The Company accounts for stock-based compensation awards using the fair value method, which requires an estimate of fair value of the award at the time of grant. On June 27, 2017, the Company's directors who are not officers or employees of the Manager or iStar were granted a total of 40,000 shares in the Company's common stock with an aggregate grant date fair value of $0.8 million. The shares granted to the directors vested immediately and the Company recognized $0.8 million in stock-based compensation, which is classified within "General and administrative" in the Company's consolidated statements of operations. Income taxes—The Company operates its business in a manner consistent with its intention to qualify as a REIT. As such, the consolidated and combined financial statements of the Company have been prepared as if the Company qualified as a REIT for the periods presented. The Company intends to qualify as and elect to be taxed as a REIT under sections 856 through 859 of the Internal Revenue Code of 1986, as amended (the "Code") beginning with its taxable year ending December 31, 2017. The Company will be subject to federal and state income taxation at corporate rates on its net taxable income; the Company, however, may claim a deduction for the amount of dividends paid to its stockholders. Amounts distributed as dividends by the Company will be subject to taxation at the stockholder level only. While the Company must distribute at least 90% of its net taxable income to qualify as a REIT, the Company intends to distribute all of its net taxable income, if any, and eliminate federal and state taxes on undistributed net taxable income. Certain states may impose minimum franchise taxes. In addition, the Company is allowed certain other non-cash deductions or adjustments, such as depreciation expense, when computing its net taxable income and distribution requirement. These deductions permit the Company to reduce its dividend payout requirement under federal tax laws. For the periods presented, the Company did not have any taxable REIT subsidiaries that would be subject to taxation. Derivative instruments and hedging activity—The Company's use of derivative financial instruments is associated with debt issuances and primarily limited to the utilization of interest rate swaps, interest rate caps or other instruments to manage interest rate risk exposure. The Company does not enter into derivatives for trading purposes. The Company recognizes derivatives as either assets or liabilities on the Company's consolidated and combined balance sheets at fair value. Derivative assets are recorded in "Deferred expenses and other assets, net" and derivative liabilities are recorded in "Accounts payable, accrued expenses and other liabilities" on the Company's consolidated and combined balance sheets. If certain conditions are met, a derivative may be specifically designated as a hedge of the exposure to changes in the fair value of a recognized asset or liability, a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability. For the Company's derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivatives is reported in accumulated other comprehensive income (loss). The ineffective portion of the change in fair value of the derivatives is recognized directly in the Company's consolidated statements of operations. For the Company's derivatives not designated as hedges, the changes in the fair value of the derivatives are reported in "Other expense" in the Company's consolidated statements of operations. The table below presents the Company's derivatives as well as their classification on the consolidated balance sheet as of December 31, 2017 ($ in thousands)(1):
Credit Risk-Related Contingent Features-The Company has agreements with each of its derivative counterparties that contain a provision where if the Company either defaults or is capable of being declared in default on any of its indebtedness, then the Company could also be declared in default on its derivative obligations. The Company reports derivative instruments on a gross basis in the consolidated financial statements. In connection with its interest rate swap derivatives which were in a liability position as of December 31, 2017, the Company posted collateral of $1.7 million which is included in "Restricted cash" on the Company's consolidated balance sheets. The Company's net exposure under these contracts was zero as of December 31, 2017. The tables below present the effect of the Company's derivative financial instruments in the consolidated statements of operations and the consolidated statements of comprehensive income (loss) for the period from April 14, 2017 to December 31, 2017 ($ in thousands):
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In February 2017, the Company entered into and settled a rate lock swap in connection with the 2017 Secured Financing (refer to Note 6). As a result of the settlement, the Company recorded a $0.4 million unrealized gain in other comprehensive income, which was recorded in "Safety, Income & Growth Inc. Predecessor equity" on the Company’s consolidated and combined balance sheets. In connection with the Company's acquisition of the Initial Portfolio, the 2017 Secured Financing was recorded at fair value and the resulting premium will be recorded as a reduction to interest expense over the term of the 2017 Secured Financing. Fair Values—The Company is required to disclose fair value information with regard to its financial instruments, whether or not recognized in the consolidated and combined balance sheets, for which it is practical to estimate fair value. The Financial Accounting Standards Board ("FASB") guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Company determines the estimated fair values of financial assets and liabilities based on a hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the Company and the Company’s own assumptions about market participant assumptions. The Company determined the carrying values of its financial instruments including cash and cash equivalents; restricted cash; ground and other lease income receivable; deferred ground and other lease income receivable, net; deferred expenses and other assets, net; and accounts payable, accrued expenses, and other liabilities approximated their fair values. For the Company's debt obligations not traded in secondary markets, the Company determines fair value primarily by using market rates currently available for debt obligations with similar terms and remaining maturities. The Company determined that the significant inputs used to value its debt obligations, net fall within Level 3 of the fair value hierarchy. The Company determined the fair value of its debt obligations, net as of December 31, 2017 was approximately $308.7 million. In connection with the Company's acquisition of the Initial Portfolio and its acquisition of two separate Ground Leases on June 28, 2017 (refer to Note 4), the Company was required to account for the acquisitions as business combinations pursuant to ASC 805. The Company utilized a third-party specialist to assist the Company in recognizing and measuring the identifiable assets acquired, the liabilities assumed, and estimating the remaining useful life of the identifiable assets acquired in accordance with ASC 350. Other—The Company is an "emerging growth company" as defined in the Jumpstart Our Business Startups Act of 2012 (the "JOBS Act") and is eligible to take advantage of certain exemptions from various reporting requirements that are applicable to other publicly-traded companies that are not "emerging growth companies," including not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act of 2002. The Company has elected to utilize the exemption for auditor attestation requirements. In addition, the JOBS Act provides that an "emerging growth company" can take advantage of the extended transition period provided in the Securities Act of 1933, as amended, for complying with new or revised accounting standards. In other words, an emerging growth company can delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. However, the Company has chosen to "opt out" of this extended transition period, and as a result, it will comply with new or revised accounting standards on the relevant dates on which adoption of such standards is required for all public companies that are not emerging growth companies. The Company's decision to opt out of the extended transition period for complying with new or revised accounting standards is irrevocable. The Company will remain an "emerging growth company" until the earliest to occur of (i) the last day of the fiscal year during which our total annual revenue equals or exceeds $1.07 billion (subject to adjustment for inflation), (ii) the last day of the fiscal year following the fifth anniversary of the Company's initial public offering, (iii) the date on which the Company has, during the previous three-year period, issued more than $1.0 billion in non-convertible debt or (iv) the date on which the Company is deemed to be a "large accelerated filer" under the Securities Exchange Act of 1934, as amended. New Accounting Pronouncements—In August 2017, the FASB issued Accounting Standards Update ("ASU") 2017-12, Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12") to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. ASU 2017-12 expands and refines hedge accounting for both nonfinancial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. ASU 2017-12 is effective for interim and annual reporting periods beginning after December 15, 2018. The Company early adopted ASU 2017-12 on January 1, 2018 and the adoption did not have a material impact on the Company's consolidated financial statements. In February 2017, the FASB issued ASU 2017-05, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets ("ASU 2017-05") to clarify the scope of Subtopic 610-20, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets, and to add guidance for partial sales of nonfinancial assets. The amendments in ASU 2017-05 simplify GAAP by eliminating several accounting differences between transactions involving assets and transactions involving businesses. The amendments in ASU 2017-05 require an entity to initially measure a retained noncontrolling interest in a nonfinancial asset at fair value consistent with how a retained noncontrolling interest in a business is measured. Also, if an entity transfers ownership interests in a consolidated subsidiary that is within the scope of ASC 610-20 and continues to have a controlling financial interest in that subsidiary, ASU 2017-05 requires the entity to account for the transaction as an equity transaction, which is consistent with how changes in ownership interests in a consolidated subsidiary that is a business are recorded when a parent retains a controlling financial interest in the business. The Company adopted ASU 2017-05 on January 1, 2018 using the modified retrospective approach and the adoption did not have a material impact on the Company's consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations: Clarifying the Definition of a Business ("ASU 2017-01") to provide a more robust framework to use in determining when a set of assets and activities is a business. The amendments provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable. The Company's real estate acquisitions have historically been accounted for as a business combination or an asset acquisition. Under ASU 2017-01, certain transactions previously accounted for as business combinations under the existing guidance would be accounted for as asset acquisitions under the new guidance. As a result, the Company expects more transaction costs to be capitalized under real estate acquisitions and less transaction costs to be expensed under business combinations as a result of the new guidance. The Company adopted ASU 2017-01 on January 1, 2018 and the adoption did not have a material impact on the Company's consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash ("ASU 2016-18") which requires that restricted cash be included with cash and cash equivalents when reconciling beginning and ending cash and cash equivalents on the statement of cash flows. In addition, ASU 2016-18 requires disclosure of what is included in restricted cash. The Company adopted ASU 2016-18 on January 1, 2018. The adoption of ASU 2016-18 did not have a material impact on the Predecessor's combined financial statements. The following table provides a reconciliation of the cash, cash equivalents and restricted cash reported in the Company's consolidated balance sheet that total to the same amount as reported in the Company's consolidated statement of cash flows (in thousands):
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In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments ("ASU 2016-15") which was issued to reduce diversity in practice in how certain cash receipts and cash payments, including debt prepayment or debt extinguishment costs, distributions from equity method investees, and other separately identifiable cash flows, are presented and classified in the statement of cash flows. The Company adopted ASU 2016-15 on January 1, 2018 and the adoption did not have a material impact on the Company's consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments (‘‘ASU 2016-13’’) which was issued to provide financial statement users with more decision useful information about the expected credit losses on financial instruments held by a reporting entity. This amendment 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 determine credit loss estimates. ASU 2016-13 is effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted for interim and annual reporting periods beginning after December 15, 2018. Management does not believe the guidance will have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (‘‘ASU 2016-02’’), which requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases. For operating leases, a lessee will be required to: (i) recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its statement of financial position; (ii) recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight line basis and (iii) classify all cash payments within operating activities in its statement of cash flows. The accounting applied by a lessor is largely unchanged from that applied under previous GAAP. However, in certain instances a long-term lease of land could be classified as a sales-type lease, resulting in the lessor derecognizing the underlying asset from its books and recording a profit or loss on the sale and a net investment in the lease. ASU 2016-02 is effective for interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. Management is evaluating the impact of the guidance on the Company’s consolidated financial statements and currently expects that certain future Ground Lease transactions will qualify as sales-type leases. This qualification will result in the Company recording a net investment in the lease asset and interest income on the net investment in the lease. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (‘'ASU 2014-09’') which supersedes existing industry-specific guidance, including ASC 360-20, Real Estate Sales. The new standard is principles-based and requires more estimates and judgment than current guidance. Certain contracts with customers, including lease contracts and financial instruments and other contractual rights, are not within the scope of the new guidance. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers—Deferral of the Effective Date, to defer the effective date of ASU 2014-09 by one year. The Company adopted ASU 2014-09 on January 1, 2018 using the modified retrospective approach and the adoption did not have a material impact on the Company's consolidated financial statements. |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Real Estate and Real Estate-Related Intangibles | —Real Estate and Real Estate-Related Intangibles The Company's real estate assets consist of the following ($ in thousands)(1):
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Real estate-related intangible assets, net consist of the following items ($ in thousands)(1):
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The estimated expense from the amortization of real estate-related intangible assets for each of the five succeeding fiscal years is as follows ($ in thousands) (1):
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Real estate-related intangible liabilities, net consist of the following items ($ in thousands)(1):
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Acquisitions—On April 14, 2017, the Company, through a merger and other formation transactions, acquired the Initial Portfolio from iStar and accounted for the acquisition as a business combination pursuant to ASC 805. On June 28, 2017, the Company separately acquired two additional Ground Leases (described below) from third party sellers for an aggregate purchase price of approximately $142.0 million and accounted for the acquisitions as business combinations pursuant to ASC 805. The Company also acquired the Ground Lease at 6201 Hollywood Boulevard, a 183,802 square foot land parcel subject to a long term Ground Lease located in Los Angeles, CA in the Hollywood neighborhood adjacent to the Hollywood/Vine metro station. The land is improved with approximately 535 apartments, 71,200 square feet of retail space, 1,300 underground parking spaces, and signage facing Hollywood Boulevard. The Ground Lease had 87 years remaining on its term. The Company also acquired the Ground Lease at 6200 Hollywood Boulevard, a 143,151 square foot land parcel subject to a long term Ground Lease located in Los Angeles, CA in the Hollywood neighborhood adjacent to the Hollywood/Vine metro station. The site is currently under construction; once completed, it will be improved with approximately 507 apartments, 56,100 square feet of retail space, 1,237 underground parking spaces, and signage facing Hollywood Boulevard. The Ground Lease had 87 years remaining on its term. The Company's preliminary purchase price allocations for the acquisitions accounted for as business combinations are presented in the table below ($ in thousands):
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The following unaudited table summarizes the Company's pro forma revenues and net income (loss) for the years ended December 31, 2017 and 2016, as if the acquisition of the Initial Portfolio, 6200 Hollywood Boulevard and 6201 Hollywood Boulevard were completed on January 1, 2016 ($ in thousands):
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From the date of acquisition through December 31, 2017, $16.1 million in total revenues and $8.5 million in net property-level income associated with the Initial Portfolio, 6200 Hollywood Boulevard and 6201 Hollywood Boulevard were included in the Company’s consolidated statements of operations. The pro forma revenues and net income are presented for informational purposes only and may not be indicative of what the actual results of operations of the Company would have been assuming the transaction occurred on January 1, 2016, nor do they purport to represent the Company’s results of operations for future periods. On August 31, 2017, the Company closed on a Ground Lease at 3333 LifeHope in Atlanta, GA for a purchase price of $16.0 million and accounted for the acquisition as an asset acquisition recording $6.3 million in "Real estate, net" and $9.7 million in "Real estate-related intangible assets, net" on the Company's consolidated balance sheet. The property is being converted into a class-A medical office building. The Ground Lease has a term of 99 years and initial rent of $0.9 million, subject to annual increases of 2%. In addition, the ground lessee will construct a 185-space parking deck adjacent to the building scheduled to be completed in 2018, which will be engineered to accommodate future development of the site. The Company has a right of first refusal to provide funding for up to 30% of the construction cost of an additional 160,000 square feet of development on terms consistent with the Ground Lease. iStar, the Company's largest shareholder, committed to provide a $24.0 million construction loan to the ground lessee with an initial term of one year for the renovation of the property. In accordance with the Company's policy with respect to transactions in which iStar is also a participant, the Company's purchase of this Ground Lease was approved by the Company’s independent directors. In October 2017, the Company entered into a purchase agreement to acquire land subject to a Ground Lease on which a 301 unit, luxury multi-family project known as “Great Oaks” is currently being constructed in San Jose, California. Pursuant to the purchase agreement, the Company will purchase the Ground Lease on November 1, 2020 from iStar for $34.0 million. iStar committed to provide a $80.5 million construction loan to the ground lessee. The Ground Lease expires in 2116. In accordance with the Company's policy with respect to transactions in which iStar is also a participant, the Company's purchase of this Ground Lease was approved by the Company’s independent directors. Future Minimum Ground and Other Lease Payments—Future minimum Ground and Other Lease payments to be collected under non-cancelable leases, excluding percentage rent and other lease payments that are not fixed and determinable, in effect as of December 31, 2017, are as follows by year ($ in thousands):
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Deferred Expenses and Other Assets, Net and Accounts Payable, Accrued Expenses and Other Liabilities |
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Deferred Expenses and Other Assets, Net and Accounts Payable, Accrued Expenses and Other Liabilities | Deferred Expenses and Other Assets, Net and Accounts Payable, Accrued Expenses and Other Liabilities Deferred expenses and other assets, net, consist of the following items ($ in thousands)(1):
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Accounts payable, accrued expenses and other liabilities consist of the following items ($ in thousands)(1):
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Debt Obligations, net |
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Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Obligations, net | Debt Obligations, net The Company's debt obligations consist of the following ($ in thousands):
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2017 Secured Financing—In March 2017, the Company entered into a $227.0 million non-recourse secured financing transaction (the "2017 Secured Financing") that bears interest at a fixed rate of 3.795% and matures in April 2027. The 2017 Secured Financing was collateralized by the Initial Portfolio including seven Ground Leases and one master lease (covering the accounts of five properties). In connection with and prior to the closing of the 2017 Secured Financing, the Company entered into a $200 million notional rate lock swap, reducing the effective rate of the 2017 Secured Financing from 3.795% to 3.773% (refer to Note 3). 2017 Revolver—In June 2017, the Company entered into a recourse senior secured revolving credit facility with a group of lenders in the maximum aggregate initial original principal amount of up to $300.0 million (the "2017 Revolver"). The 2017 Revolver has a term of three years with two 12-month extension options exercisable by the Company, subject to certain conditions, and bears interest at an annual rate of applicable LIBOR plus 1.35%. An undrawn credit facility commitment fee ranges from 0.15% to 0.25%, based on utilization each quarter. This fee was waived for the first six months after the closing date of June 27, 2017. The 2017 Revolver will allow the Company to leverage Ground Leases up to 67%. The 2017 Revolver provides an accordion feature to increase, subject to certain conditions, the maximum availability up to $500.0 million. The Company incurred $3.0 million of lender and third-party fees, all of which were capitalized in "Deferred expenses and other assets, net" on the Company's consolidated balance sheet. 2017 Hollywood Mortgage—In December 2017, the Company entered into a $71.0 million mortgage on 6200 Hollywood Boulevard and 6201 Hollywood Boulevard (the "2017 Hollywood Mortgage"). The 2017 Hollywood Mortgage bears interest at a rate of one-month LIBOR plus 1.33%, matures in January 2023 and is callable without pre-payment penalty beginning in January 2021. The Company incurred $1.3 million of lender and third-party fees, all of which were capitalized in "Debt obligations, net" on the Company's consolidated balance sheet. Debt Covenants—The Company is subject to financial covenants under the 2017 Revolver, including maintaining: a limitation on total consolidated leverage of not more than 70%, or 75% for no more than 180 days, of the Company's total consolidated assets; a consolidated fixed charge coverage ratio of at least 1.45x; a consolidated tangible net worth of at least 75% of the Company's tangible net worth at the date of the 2017 Revolver plus 75% of future issuances of net equity; a consolidated secured leverage ratio of not more than 70%, or 75% for no more than 180 days, of the Company's total consolidated assets; and a secured recourse debt ratio of not more than 5.0% of the Company's total consolidated assets. Additionally, the 2017 Revolver restricts the Company's ability to pay distributions to its stockholders. In 2017, the Company was permitted to make distributions based on an annualized distribution rate of 3.0% of the initial public offering price per share of its common stock. Beginning in 2018, the Company will be permitted to make annual distributions up to an amount equal to 110% of the Company's adjusted funds from operations, as calculated in accordance with the 2017 Revolver. In addition, the Company may make distributions to the extent necessary to maintain the Company's qualification as a REIT. As of December 31, 2017, the Company was in compliance with all of its financial covenants. Future Scheduled Maturities—As of December 31, 2017, future scheduled maturities of outstanding debt obligations, assuming all extension options are exercised, are as follows ($ in thousands):
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Commitments and Contingencies |
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Dec. 31, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Unfunded Commitments—In October 2017, the Company entered into a purchase agreement to acquire land subject to a Ground Lease on November 1, 2020 from iStar for $34.0 million (refer to Note 4). Legal Proceedings—The Company evaluates developments in legal proceedings that could require a liability to be accrued and/or disclosed. Based on its current knowledge, and after consultation with legal counsel, the Company believes it is not a party to, nor are any of its properties the subject of, any pending legal proceeding that would have a material adverse effect on the Company’s consolidated and combined financial statements. |
Risk Management |
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Dec. 31, 2017 | |
Risks and Uncertainties [Abstract] | |
Risk Management | Risk Management In the normal course of its ongoing business operations, the Company encounters credit risk. Credit risk is the risk of default on the Company’s leases that result from a tenant’s inability or unwillingness to make contractually required payments. Risk concentrations—Concentrations of credit risks arise when the Company has multiple leases with a particular tenant or credit party, or a number of the Company’s tenants are engaged in similar business activities, or activities in the same geographic region, or have similar economic features, such that their ability to meet contractual obligations, including those to the Company, could be similarly affected by changes in economic conditions. The Company underwrites the credit of prospective tenants and often requires them to provide some form of credit support such as corporate guarantees. Although the Company’s real estate assets are geographically diverse and the tenants operate in a variety of industries and property types, to the extent the Company has a significant concentration of ground and other lease income from any tenant, the inability of that tenant to make its payment could have a material adverse effect on the Company. During the year ended December 31, 2017, the Company’s two largest tenants accounted for approximately $10.4 million and $5.3 million, or 45% and 23%, respectively, of the Company’s revenues. The gross carrying value of five hotels leased by the Company under a master lease guaranteed by Park Intermediate Holdings LLC represented 30% of the Company’s total assets at December 31, 2017. Park Intermediate Holdings LLC is a subsidiary of Park Hotels & Resorts Inc., which is a public reporting company. According to Park Hotels & Resorts Inc.’s public Securities and Exchange Commission filings, Park Hotels & Resorts Inc. conducts substantially all of its business and holds substantially all of its assets through Park Intermediate Holdings LLC. For detailed financial information regarding Park Hotels & Resorts Inc., please refer to its financial statements, which are publicly available on the website of the Securities and Exchange Commission at http://www.sec.gov. |
Equity |
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Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity | Equity Common Stock—On April 14, 2017, two institutional investors acquired 2,875,000 shares of the Company's common stock for $57.5 million and iStar acquired 2,775,000 shares of the Company's common stock for $55.5 million. On June 27, 2017, the Company sold 10,250,000 shares of its common stock in its initial public offering for proceeds of $205.0 million. Concurrently with the initial public offering, the Company sold $45.0 million in shares, or 2,250,000 shares, of its common stock to iStar in a private placement and issued a total of 40,000 shares to its directors who are not employees of the Manager or iStar in consideration for their services as directors. The following table presents a summary of the Company's ownership as of the initial public offering on June 27, 2017:
Subsequent to the initial public offering and through December 31, 2017, iStar purchased 1.8 million shares of the Company's common stock for $34.1 million, at an average cost of $18.85 per share, pursuant to two 10b5-1 plans (the “10b5-1 Plans") in accordance with Rules 10b5-1 and 10b-18 under the Securities and Exchange Act of 1934, as amended, under which it could buy shares of the Company's common stock in the open market up to an ownership limit of 39.9%. As of December 31, 2017, iStar owned 37.6% of the Company's common stock. Subsequent to December 31, 2017, iStar utilized the remaining availability under its 10b5-1 Plans and purchased an additional 0.4 million shares of the Company's common stock for $7.6 million, at an average cost of $17.92 per share. As of February 15, 2018, iStar owned 39.9% of the Company's common stock. In addition, subsequent to the initial public offering, trusts established by Jay Sugarman, the Company's Chairman and Chief Executive Officer, and Geoffrey Jervis, the Company's Chief Operating Officer and Chief Financial Officer, purchased 26 thousand shares in the aggregate of the Company's common stock for an aggregate $0.5 million, at an average cost of $19.20 per share, pursuant to a 10b5-1 plan (the “10b5-1 Plan") in accordance with Rules 10b5-1 and 10b-18 under the Securities and Exchange Act of 1934, as amended, under which they could buy in the open market up to $0.5 million in the aggregate of the Company’s common stock. As of December 31, 2017, the trusts established by Jay Sugarman, the Company's Chairman and Chief Executive Officer, and Geoffrey Jervis, the Company's Chief Operating Officer and Chief Financial Officer, had utilized all of the availability authorized in the 10b5-1 Plan. Safety, Income & Growth Inc. Predecessor Equity—For the periods prior to April 14, 2017, Safety, Income & Growth Inc. Predecessor Equity represents net contributions from and distributions to iStar. Most of the entities included in the Predecessor’s financial statements did not have bank accounts for the periods presented and most cash transactions for the Predecessor were transacted through bank accounts owned by iStar and are included in Safety, Income & Growth Inc. Predecessor Equity. Dividends—The Company intends to elect to qualify as a REIT beginning with its taxable year ending December 31, 2017. To qualify as a REIT, the Company must annually distribute, at a minimum, an amount equal to 90% of its taxable income, excluding net capital gains, and must distribute 100% of its taxable income (including net capital gains) to eliminate corporate federal income taxes payable by the REIT. Because taxable income differs from cash flow from operations due to non-cash revenues and expenses (such as depreciation and other items), in certain circumstances, the Company may generate operating cash flow in excess of its dividends, or alternatively, may need to make dividend payments in excess of operating cash flows. During the year ended December 31, 2017, the Company declared cash dividends on its common stock of $5.6 million, or $0.3066 per share. All dividends paid in 2017 qualified as a return of capital for tax reporting purposes. |
Earnings Per Share |
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share | Earnings Per Share EPS is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of shares outstanding for the period. The following table presents a reconciliation of income (loss) from operations used in the basic and diluted EPS calculations ($ in thousands, except for per share data)(1):
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Related Party Transactions |
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Dec. 31, 2017 | |||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||
Related Party Transactions | Related Party Transactions The Company is externally managed by an affiliate of iStar, the Company's largest shareholder. Although the Manager was recently formed, iStar has been an active real estate investor for over 20 years and has executed transactions with an aggregate value in excess of $35.0 billion. iStar has an extensive network for sourcing investments, which includes relationships with brokers, corporate tenants and developers that it has established over its long operating history. As of September 30, 2017, iStar had total assets of approximately $5.8 billion and 189 employees in its New York City headquarters and its seven regional offices across the United States. Management Agreement The Company has designed what it believes to be a management agreement with unique features that create alignment and incentives. A summary of the terms of the management agreement is below:
For the period from April 14, 2017 to December 31, 2017, the Company recorded $2.0 million in management fees to the Manager. These management fees are recorded in "General and administrative expenses" in the Company's consolidated statements of operations. The management fees were not actually paid to the Manager because no management fees are payable during the first year of the agreement. The fees were accounted for as a non-cash capital contribution from iStar despite iStar not receiving any compensation for its services. Expense Reimbursements The Company pays, or reimburses the Manager for, all of the Company's operating expenses, except those specifically required to be borne by the Manager under the management agreement. In addition, because the Manager’s personnel perform certain legal, accounting, due diligence tasks and other services that third-party professionals or consultants otherwise would perform, the Manager is reimbursed, in cash or in shares of the Company's common stock, for the documented cost of performing such tasks. For the period from the initial public offering on June 27, 2017 to December 31, 2017, the Company was allocated $0.6 million in expenses from the Manager. These expenses are recorded in "General and administrative expenses" in the Company's consolidated statement of operations. In accordance with the provisions of the management agreement, the expenses were waived by the Manager and, accordingly, were accounted for as a non-cash capital contribution from iStar despite iStar not receiving any reimbursement for these allocated expenses. |
Quarterly Financial Information (Unaudited) |
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Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Financial Information (Unaudited) | Quarterly Financial Information (Unaudited) The following table sets forth the selected quarterly financial data for the Company ($ in thousands, except per share amounts).
_______________________________________________________________________________ (1) The combined statements of operations prior to April 14, 2017 represented the activity of the Predecessor and EPS was not applicable. |
Subsequent Events |
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Dec. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On January 25, 2018, the Company acquired land for $38.5 million and simultaneously entered into a Ground Lease as part of the Ground Lease tenant's acquisition of Onyx on First (the “Property”). The Property is a multifamily building located in the Navy Yards neighborhood of Washington, D.C., just one block away from the Navy Yards metro station. The Ground Lease has a term of 99 years. |
Schedule III - Real Estate and Accumulated Depreciation |
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SEC Schedule III, Real Estate and Accumulated Depreciation Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
SEC Schedule III, Real Estate and Accumulated Depreciation |
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The following table reconciles real estate from April 14, 2017 to December 31, 2017, from January 1, 2017 to April 13, 2017 and for the years ended December 31, 2016 and 2015(1):
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The following table reconciles accumulated depreciation from April 14, 2017 to December 31, 2017, from January 1, 2017 to April 13, 2017 and for the years ended December 31, 2016 and 2015(1):
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Summary of Significant Accounting Policies (Policies) |
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Accounting Policies [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Basis of Presentation | Basis of Presentation—For periods prior to April 14, 2017, the accompanying combined financial statements do not represent the financial position and results of operations of one legal entity, but rather a combination of entities under common control that have been ‘‘carved out’’ from iStar’s consolidated financial statements. For periods prior to April 14, 2017, these combined financial statements reflect the revenues and expenses of the Predecessor and include certain material assets and liabilities of iStar that are specifically identifiable and generated through, or associated with, an in-place lease, which have been reflected at iStar’s historical basis. For periods subsequent to April 14, 2017, the accompanying consolidated financial statements represent the consolidated financial statements of the Company. In addition, as a result of the Company's acquisition of the Initial Portfolio from iStar, the consolidated financial statements subsequent to April 14, 2017 are presented on a new basis of accounting pursuant to Accounting Standards Codification ("ASC") 805 (refer to Note 4). |
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Use of Estimates | The preparation of these consolidated and combined financial statements in conformity with generally accepted accounting principles in the United States of America (‘‘GAAP’’) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenues and expenses during the reporting periods. These combined financial statements for the periods prior to April 14, 2017 include an allocation of general and administrative expenses and interest expense to the Predecessor from iStar. General and administrative expenses include certain iStar corporate functions, including executive oversight, treasury, finance, human resources, tax compliance and planning, internal audit, financial reporting, information technology and investor relations. General and administrative expenses, including stock based compensation, represent a pro rata allocation of costs from iStar’s net lease and corporate business segments based on our average net assets as a percentage of iStar’s average net assets. Interest expense was allocated to the Predecessor by calculating its average net assets as a percentage of the average net assets in iStar’s net lease business segment and multiplying that percentage by the interest expense allocated to iStar’s net lease business segment (only for the number of days in the period in which the Predecessor did not have debt obligations outstanding—refer to Note 6). The Company believes the allocation methodology for the general and administrative expenses and interest expense is reasonable. Accordingly, the general and administrative expense allocation presented in our combined statements of operations for Predecessor periods does not necessarily reflect what our general and administrative expenses will be as a standalone public company for future reporting periods. |
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Real estate | Real estate—Real estate assets are recorded at cost less accumulated depreciation and amortization, as follows: |
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Capitalization and depreciation | Capitalization and depreciation—Certain improvements and replacements are capitalized when they extend the useful life of the asset. Repair and maintenance costs are expensed as incurred. Depreciation is computed using the straight-line method over the estimated useful life, which is generally 40 years for facilities, the shorter of the remaining lease term or expected life for tenant improvements and the remaining useful life of the facility for facility improvements. |
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Purchase price allocation | Purchase price allocation—Upon acquisition of real estate, the Company determines whether the transaction is a business combination, which is accounted for under the acquisition method, or an acquisition of assets. For both types of transactions, the Company recognizes and measures identifiable assets acquired, liabilities assumed and any noncontrolling interest in the acquiree based on their relative fair values. For business combinations, the Company recognizes and measures goodwill or gain from a bargain purchase, if applicable, and expenses acquisition-related costs in the periods in which the costs are incurred. For acquisitions of assets, acquisition-related costs are capitalized and recorded in "Real estate, net" on the Company's combined balance sheets. If the Company acquires real estate and simultaneously enters into a new lease of the real estate the acquisition will be accounted for as an asset acquisition. The Company accounts for its acquisition of properties by recording the purchase price of tangible and intangible assets and liabilities acquired based on their estimated fair values. The value of the tangible assets, consisting of land, buildings, building improvements and tenant improvements is determined as if these assets are vacant. Intangible assets may include the value of lease incentive assets, above-market leases, below-market Ground Lease assets and in-place leases, which are each recorded at their estimated fair values and included in "Real estate-related intangible assets, net" on the Company's consolidated and combined balance sheets. Intangible liabilities may include the value of below-market leases, which are recorded at their estimated fair values and included in "Real estate-related intangible liabilities, net" on the Company's consolidated and combined balance sheets. In-place leases are amortized over the remaining non-cancelable term and the amortization expense is included in "Depreciation and amortization" in the Company's consolidated and combined statements of operations. Lease incentive assets and above-market (or below-market) lease value are amortized as a reduction of (or, increase to) ground and other lease income over the remaining non-cancelable term of each lease. Below-market Ground Lease assets are amortized to real state estate expense over the remaining non-cancelable term of the lease. The Company may also engage in sale/leaseback transactions whereby the Company executes a net lease with the occupant simultaneously with the purchase of the asset. |
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Impairments | Impairments—The Company reviews real estate assets for impairment in value whenever events or changes in circumstances indicate that the carrying amount of such assets may not be recoverable. The value of a long-lived asset held for use is impaired if management's estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the asset (taking into account the anticipated holding period of the asset) are less than its carrying value. Such estimate of cash flows considers factors such as expected future operating income trends, as well as the effects of demand, competition and other economic factors. To the extent impairment has occurred, the loss will be measured as the excess of the carrying amount of the asset over the estimated fair value of the asset and reflected as an adjustment to the basis of the asset. Impairments of real estate assets are recorded in "Impairment of assets" in the Company's combined statements of operations. The Company did not record any impairments for the periods presented. |
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Cash and cash equivalents | Cash and cash equivalents—Cash and cash equivalents include cash held in banks or invested in money market funds, if applicable, with original maturity terms of less than 90 days. |
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Restricted cash | Restricted Cash—Restricted cash includes $1.7 million required to be maintained under certain of the Company's derivative transactions. |
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Ground and other lease income | Ground and other lease income—Ground and other lease income includes rent earned from leasing land and buildings owned by the Company to its tenants. Ground and other lease income is recognized on the straight-line method of accounting, generally from the later of the date the lessee takes possession of the space and it is ready for its intended use or the date of acquisition of the asset subject to existing leases. Accordingly, contractual lease payment increases are recognized evenly over the term of the lease. The periodic difference between ground and other lease income recognized under this method and contractual lease payment terms is recorded as deferred ground and other lease income receivable and is included in ‘‘Deferred ground and other lease income receivable, net’’ on the Company's consolidated and combined balance sheets. The Company is also entitled to percentage rent pursuant to some of its leases and records percentage rent as ground and other lease income when earned. During the periods from January 1, 2017 to April 13, 2017 and April 14, 2017 to December 31, 2017, the Company recorded $0.6 million and $0.1 million, respectively, of percentage rent. During the years ended December 31, 2016 and 2015, the Company recorded $3.2 million and $2.9 million, respectively, of percentage rent. Ground and other lease income also includes the amortization of finite lived intangible assets and liabilities, which are amortized over the period during which the assets or liabilities are expected to contribute directly or indirectly to the future cash flows of the business acquired. The Company estimates losses within ground and other lease income receivable and deferred ground and other lease income receivable balances as of the balance sheet date and incorporates an asset-specific reserve based on management's evaluation of the credit risks associated with these receivables. As of December 31, 2017 and 2016, we did not have an allowance for doubtful accounts related to real estate tenant receivables or deferred ground and other lease income. |
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Other Income | Other income—Other income primarily includes interest income, non-recurring lease termination fees and other ancillary income. Interest income on other assets is recognized on an accrual basis using the effective interest method. The Company considers receivables to be non-performing and places receivables on non-accrual status at such time as: (1) the receivable becomes 90 days delinquent; (2) the receivable has a maturity default; or (3) management determines it is probable that it will be unable to collect all amounts due according to the contractual terms of the receivable. |
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Earnings per share | Earnings per share—The Company has one class of common stock. Earnings per share ("EPS") is calculated by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding (refer to Note 9 for a summary of shares outstanding). |
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Deferred expense and other assets | Deferred expenses and other assets—Deferred expenses include deferred financing fees associated with the 2017 Revolver (refer to Note 6), derivative assets, purchase deposits, leasing costs such as brokerage, legal and other costs which are amortized over the life of the respective leases and presented as an operating activity in the Company's consolidated and combined statements of cash flows. Amortization of leasing costs is included in "Depreciation and amortization" in the Company's consolidated and combined statements of operations. As of December 31, 2016, other assets primarily includes a receivable related to the funding provided to a certain investment in a Ground Lease. This receivable is classified as held-for-investment and is reported at its outstanding unpaid principal balance and includes accrued and paid-in-kind interest. |
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Deferred financing fees | Deferred financing fees—Deferred financing fees associated with the 2017 Revolver (refer to Note 6) are recorded in ‘‘Deferred expenses and other assets, net’’ on the Company’s consolidated and combined balance sheets. Deferred financing fees associated with the Company's other facilities are recorded in ‘‘Debt obligations, net’’ on the Company's consolidated and combined balance sheets. The amortization of deferred financing fees is included in ‘‘Interest expense’’ in the Company’s consolidated and combined statements of operations. |
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Dispositions | Dispositions—Gains on the sale of real estate assets are recognized in "Income from sales of real estate" in accordance with ASC 360-20, Real Estate Sales. Gains on sales of real estate are recognized for full profit recognition upon closing of the sale transactions, when the profit is determinable, the earnings process is virtually complete, the parties are bound by the terms of the contract, all consideration has been exchanged, any permanent financing for which the seller is responsible has been arranged and all conditions for closing have been performed. The Company primarily uses specific identification and the relative sales value method to allocate costs. |
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Stock-based compensation | Stock-based compensation—The Company adopted an equity incentive plan to provide equity incentive opportunities to members of the Manager’s management team and employees who perform services for the Company, the Company's independent directors, advisers, consultants and other personnel. The Company's equity incentive plan provides for grants of stock options, shares of restricted common stock, phantom shares, dividend equivalent rights and other equity-based awards, including long-term incentive plan units. The Company accounts for stock-based compensation awards using the fair value method, which requires an estimate of fair value of the award at the time of grant. On June 27, 2017, the Company's directors who are not officers or employees of the Manager or iStar were granted a total of 40,000 shares in the Company's common stock with an aggregate grant date fair value of $0.8 million. The shares granted to the directors vested immediately and the Company recognized $0.8 million in stock-based compensation, which is classified within "General and administrative" in the Company's consolidated statements of operations. |
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Income taxes | Income taxes—The Company operates its business in a manner consistent with its intention to qualify as a REIT. As such, the consolidated and combined financial statements of the Company have been prepared as if the Company qualified as a REIT for the periods presented. The Company intends to qualify as and elect to be taxed as a REIT under sections 856 through 859 of the Internal Revenue Code of 1986, as amended (the "Code") beginning with its taxable year ending December 31, 2017. The Company will be subject to federal and state income taxation at corporate rates on its net taxable income; the Company, however, may claim a deduction for the amount of dividends paid to its stockholders. Amounts distributed as dividends by the Company will be subject to taxation at the stockholder level only. While the Company must distribute at least 90% of its net taxable income to qualify as a REIT, the Company intends to distribute all of its net taxable income, if any, and eliminate federal and state taxes on undistributed net taxable income. Certain states may impose minimum franchise taxes. In addition, the Company is allowed certain other non-cash deductions or adjustments, such as depreciation expense, when computing its net taxable income and distribution requirement. These deductions permit the Company to reduce its dividend payout requirement under federal tax laws. For the periods presented, the Company did not have any taxable REIT subsidiaries that would be subject to taxation. |
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Derivative instruments and hedging activity | Derivative instruments and hedging activity—The Company's use of derivative financial instruments is associated with debt issuances and primarily limited to the utilization of interest rate swaps, interest rate caps or other instruments to manage interest rate risk exposure. The Company does not enter into derivatives for trading purposes. The Company recognizes derivatives as either assets or liabilities on the Company's consolidated and combined balance sheets at fair value. Derivative assets are recorded in "Deferred expenses and other assets, net" and derivative liabilities are recorded in "Accounts payable, accrued expenses and other liabilities" on the Company's consolidated and combined balance sheets. If certain conditions are met, a derivative may be specifically designated as a hedge of the exposure to changes in the fair value of a recognized asset or liability, a hedge of a forecasted transaction or the variability of cash flows to be received or paid related to a recognized asset or liability. |
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Fair values | Fair Values—The Company is required to disclose fair value information with regard to its financial instruments, whether or not recognized in the consolidated and combined balance sheets, for which it is practical to estimate fair value. The Financial Accounting Standards Board ("FASB") guidance defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants on the measurement date. The Company determines the estimated fair values of financial assets and liabilities based on a hierarchy that distinguishes between market participant assumptions based on market data obtained from sources independent of the Company and the Company’s own assumptions about market participant assumptions. The Company determined the carrying values of its financial instruments including cash and cash equivalents; restricted cash; ground and other lease income receivable; deferred ground and other lease income receivable, net; deferred expenses and other assets, net; and accounts payable, accrued expenses, and other liabilities approximated their fair values. For the Company's debt obligations not traded in secondary markets, the Company determines fair value primarily by using market rates currently available for debt obligations with similar terms and remaining maturities. The Company determined that the significant inputs used to value its debt obligations, net fall within Level 3 of the fair value hierarchy. The Company determined the fair value of its debt obligations, net as of December 31, 2017 was approximately $308.7 million. |
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New accounting pronouncements | New Accounting Pronouncements—In August 2017, the FASB issued Accounting Standards Update ("ASU") 2017-12, Derivatives and Hedging - Targeted Improvements to Accounting for Hedging Activities ("ASU 2017-12") to better align an entity’s risk management activities and financial reporting for hedging relationships through changes to both the designation and measurement guidance for qualifying hedging relationships and the presentation of hedge results. ASU 2017-12 expands and refines hedge accounting for both nonfinancial and financial risk components and aligns the recognition and presentation of the effects of the hedging instrument and the hedged item in the financial statements. ASU 2017-12 is effective for interim and annual reporting periods beginning after December 15, 2018. The Company early adopted ASU 2017-12 on January 1, 2018 and the adoption did not have a material impact on the Company's consolidated financial statements. In February 2017, the FASB issued ASU 2017-05, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets ("ASU 2017-05") to clarify the scope of Subtopic 610-20, Other Income—Gains and Losses from the Derecognition of Nonfinancial Assets, and to add guidance for partial sales of nonfinancial assets. The amendments in ASU 2017-05 simplify GAAP by eliminating several accounting differences between transactions involving assets and transactions involving businesses. The amendments in ASU 2017-05 require an entity to initially measure a retained noncontrolling interest in a nonfinancial asset at fair value consistent with how a retained noncontrolling interest in a business is measured. Also, if an entity transfers ownership interests in a consolidated subsidiary that is within the scope of ASC 610-20 and continues to have a controlling financial interest in that subsidiary, ASU 2017-05 requires the entity to account for the transaction as an equity transaction, which is consistent with how changes in ownership interests in a consolidated subsidiary that is a business are recorded when a parent retains a controlling financial interest in the business. The Company adopted ASU 2017-05 on January 1, 2018 using the modified retrospective approach and the adoption did not have a material impact on the Company's consolidated financial statements. In January 2017, the FASB issued ASU 2017-01, Business Combinations: Clarifying the Definition of a Business ("ASU 2017-01") to provide a more robust framework to use in determining when a set of assets and activities is a business. The amendments provide more consistency in applying the guidance, reduce the costs of application, and make the definition of a business more operable. The Company's real estate acquisitions have historically been accounted for as a business combination or an asset acquisition. Under ASU 2017-01, certain transactions previously accounted for as business combinations under the existing guidance would be accounted for as asset acquisitions under the new guidance. As a result, the Company expects more transaction costs to be capitalized under real estate acquisitions and less transaction costs to be expensed under business combinations as a result of the new guidance. The Company adopted ASU 2017-01 on January 1, 2018 and the adoption did not have a material impact on the Company's consolidated financial statements. In November 2016, the FASB issued ASU 2016-18, Statement of Cash Flows: Restricted Cash ("ASU 2016-18") which requires that restricted cash be included with cash and cash equivalents when reconciling beginning and ending cash and cash equivalents on the statement of cash flows. In addition, ASU 2016-18 requires disclosure of what is included in restricted cash. The Company adopted ASU 2016-18 on January 1, 2018. The adoption of ASU 2016-18 did not have a material impact on the Predecessor's combined financial statements. The following table provides a reconciliation of the cash, cash equivalents and restricted cash reported in the Company's consolidated balance sheet that total to the same amount as reported in the Company's consolidated statement of cash flows (in thousands):
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In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments ("ASU 2016-15") which was issued to reduce diversity in practice in how certain cash receipts and cash payments, including debt prepayment or debt extinguishment costs, distributions from equity method investees, and other separately identifiable cash flows, are presented and classified in the statement of cash flows. The Company adopted ASU 2016-15 on January 1, 2018 and the adoption did not have a material impact on the Company's consolidated financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses: Measurement of Credit Losses on Financial Instruments (‘‘ASU 2016-13’’) which was issued to provide financial statement users with more decision useful information about the expected credit losses on financial instruments held by a reporting entity. This amendment 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 determine credit loss estimates. ASU 2016-13 is effective for interim and annual reporting periods beginning after December 15, 2019. Early adoption is permitted for interim and annual reporting periods beginning after December 15, 2018. Management does not believe the guidance will have a material impact on the Company’s consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (‘‘ASU 2016-02’’), which requires the recognition of lease assets and lease liabilities by lessees for those leases classified as operating leases. For operating leases, a lessee will be required to: (i) recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its statement of financial position; (ii) recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, generally on a straight line basis and (iii) classify all cash payments within operating activities in its statement of cash flows. The accounting applied by a lessor is largely unchanged from that applied under previous GAAP. However, in certain instances a long-term lease of land could be classified as a sales-type lease, resulting in the lessor derecognizing the underlying asset from its books and recording a profit or loss on the sale and a net investment in the lease. ASU 2016-02 is effective for interim and annual reporting periods beginning after December 15, 2018. Early adoption is permitted. Management is evaluating the impact of the guidance on the Company’s consolidated financial statements and currently expects that certain future Ground Lease transactions will qualify as sales-type leases. This qualification will result in the Company recording a net investment in the lease asset and interest income on the net investment in the lease. In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (‘'ASU 2014-09’') which supersedes existing industry-specific guidance, including ASC 360-20, Real Estate Sales. The new standard is principles-based and requires more estimates and judgment than current guidance. Certain contracts with customers, including lease contracts and financial instruments and other contractual rights, are not within the scope of the new guidance. In August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers—Deferral of the Effective Date, to defer the effective date of ASU 2014-09 by one year. The Company adopted ASU 2014-09 on January 1, 2018 using the modified retrospective approach and the adoption did not have a material impact on the Company's consolidated financial statements. |
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Principles of Combination and Consolidation | Principles of Consolidation and Combination—For the periods prior to April 14, 2017, the combined financial statements include on a carve-out basis the historical balance sheets and statements of operations and cash flows attributed to the Predecessor. For the periods subsequent to April 14, 2017, the consolidated financial statements include the accounts and operations of the Company and its consolidated subsidiaries |
Summary of Significant Accounting Policies (Tables) |
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Accounting Policies [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Interest Rate Derivatives | The table below presents the Company's derivatives as well as their classification on the consolidated balance sheet as of December 31, 2017 ($ in thousands)(1):
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Derivative Instruments, Gain (Loss) | The tables below present the effect of the Company's derivative financial instruments in the consolidated statements of operations and the consolidated statements of comprehensive income (loss) for the period from April 14, 2017 to December 31, 2017 ($ in thousands):
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Restrictions on Cash and Cash Equivalents | The following table provides a reconciliation of the cash, cash equivalents and restricted cash reported in the Company's consolidated balance sheet that total to the same amount as reported in the Company's consolidated statement of cash flows (in thousands):
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Real Estate and Real Estate-Related Intangibles (Tables) |
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Real Estate [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Real Estate Assets | The Company's real estate assets consist of the following ($ in thousands)(1):
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Schedule of Real Estate-Related Intangible Assets, Net | Real estate-related intangible assets, net consist of the following items ($ in thousands)(1):
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Schedule of Future Amortization Expense | The estimated expense from the amortization of real estate-related intangible assets for each of the five succeeding fiscal years is as follows ($ in thousands) (1):
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Real Estate - Related Intangibles, Liabilities | Real estate-related intangible liabilities, net consist of the following items ($ in thousands)(1):
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Purchase Price Allocations | The Company's preliminary purchase price allocations for the acquisitions accounted for as business combinations are presented in the table below ($ in thousands):
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Pro Forma Revenues and Net Income (Loss) | The following unaudited table summarizes the Company's pro forma revenues and net income (loss) for the years ended December 31, 2017 and 2016, as if the acquisition of the Initial Portfolio, 6200 Hollywood Boulevard and 6201 Hollywood Boulevard were completed on January 1, 2016 ($ in thousands):
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Future Minimum Ground Net Lease Payments | Future minimum Ground and Other Lease payments to be collected under non-cancelable leases, excluding percentage rent and other lease payments that are not fixed and determinable, in effect as of December 31, 2017, are as follows by year ($ in thousands):
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Deferred Expenses and Other Assets, Net and Accounts Payable, Accrued Expenses and Other Liabilities (Tables) |
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of deferred expenses and other assets, net | Deferred expenses and other assets, net, consist of the following items ($ in thousands)(1):
_______________________________________________________________________________
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of accounts payable, accrued expenses and other liabilities | Accounts payable, accrued expenses and other liabilities consist of the following items ($ in thousands)(1):
_______________________________________________________________________________
|
Debt Obligations, net (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of debt obligations | The Company's debt obligations consist of the following ($ in thousands):
_______________________________________________________________________________
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Schedule of Maturities of Long-term Debt | As of December 31, 2017, future scheduled maturities of outstanding debt obligations, assuming all extension options are exercised, are as follows ($ in thousands):
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Equity (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Equity [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Stockholders Equity | The following table presents a summary of the Company's ownership as of the initial public offering on June 27, 2017:
|
Earnings Per Share (Tables) |
12 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of earnings per share | The following table presents a reconciliation of income (loss) from operations used in the basic and diluted EPS calculations ($ in thousands, except for per share data)(1):
_______________________________________________________________________________
|
Related Party Transactions (Tables) |
12 Months Ended | ||||||||||||||||||||||
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Dec. 31, 2017 | |||||||||||||||||||||||
Related Party Transactions [Abstract] | |||||||||||||||||||||||
Schedule of Related Party Transactions | A summary of the terms of the management agreement is below:
|
Quarterly Financial Information (Unaudited) (Tables) |
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Dec. 31, 2017 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Quarterly Financial Information Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of quarterly financial information | The following table sets forth the selected quarterly financial data for the Company ($ in thousands, except per share amounts).
_______________________________________________________________________________ (1) The combined statements of operations prior to April 14, 2017 represented the activity of the Predecessor and EPS was not applicable. |
Business and Organization (Details) |
12 Months Ended | |||||
---|---|---|---|---|---|---|
Jun. 28, 2017
USD ($)
|
Jun. 27, 2017
USD ($)
$ / shares
shares
|
Apr. 14, 2017
USD ($)
investor
$ / shares
shares
|
Dec. 31, 2017
property
|
Mar. 31, 2017
USD ($)
|
Mar. 30, 2017
USD ($)
|
|
Business Acquisition [Line Items] | ||||||
Number of institutional investors | investor | 2 | |||||
Total consideration | $ 142,000,000 | |||||
IPO and Private Placement | ||||||
Business Acquisition [Line Items] | ||||||
Proceeds from initial public offering | $ 205,000,000 | |||||
Proceeds from private placement offering | $ 45,000,000 | |||||
Share price (in dollars per share) | $ / shares | $ 20.00 | |||||
iStar Inc. | IPO and Private Placement | ||||||
Business Acquisition [Line Items] | ||||||
Transaction costs | $ 18,900,000 | |||||
Initial Portfolio from iStar | ||||||
Business Acquisition [Line Items] | ||||||
Number of properties | property | 12 | |||||
Total consideration | $ 340,000,000 | |||||
Common Stock | Initial Capitalization | ||||||
Business Acquisition [Line Items] | ||||||
Number of institutional investors | investor | 2 | |||||
Stock issued (in shares) | shares | 2,875,000 | |||||
Proceeds from issuance of common stock | $ 57,500,000 | |||||
Ownership percentage by Shareholders | 51.00% | |||||
Share price (in dollars per share) | $ / shares | $ 20.00 | |||||
Common Stock | IPO and Private Placement | ||||||
Business Acquisition [Line Items] | ||||||
Stock issued (in shares) | shares | 10,250,000 | |||||
Proceeds from initial public offering | $ 205,000,000 | |||||
Common Stock | iStar Inc. | Initial Capitalization | ||||||
Business Acquisition [Line Items] | ||||||
Stock issued (in shares) | shares | 2,775,000 | |||||
Proceeds from issuance of common stock | $ 55,500,000 | |||||
Ownership percentage by Shareholders | 49.00% | |||||
Share price (in dollars per share) | $ / shares | $ 20.00 | |||||
Common Stock | iStar Inc. | IPO and Private Placement | ||||||
Business Acquisition [Line Items] | ||||||
Stock issued (in shares) | shares | 2,250,000 | |||||
Proceeds from private placement offering | $ 45,000,000 | |||||
Share price (in dollars per share) | $ / shares | $ 20 | |||||
Minimum | ||||||
Business Acquisition [Line Items] | ||||||
Ground leases term | 30 years | |||||
Ground lease investment initial targeted value of ground lease of combined value | 30.00% | |||||
Ground lease, ratio of property net operating income to ground lease payments due | 2.0 | |||||
Maximum | ||||||
Business Acquisition [Line Items] | ||||||
Ground leases term | 99 years | |||||
Ground lease investment initial targeted value of ground lease of combined value | 45.00% | |||||
Ground lease, ratio of property net operating income to ground lease payments due | 5.0 | |||||
Secured Debt | 2017 Secured Financing | ||||||
Business Acquisition [Line Items] | ||||||
Assumption of long term debt | $ 227,000,000.0 | $ 227,000,000 |
Summary of Significant Accounting Policies (Narrative) (Details) $ in Millions |
3 Months Ended | 9 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|---|
Jun. 27, 2017
USD ($)
shares
|
Apr. 13, 2017
USD ($)
|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2017
USD ($)
business
|
Dec. 31, 2016
USD ($)
|
Dec. 31, 2015
USD ($)
|
|
Class of Stock [Line Items] | ||||||
Debt Instrument, Fair Value Disclosure | $ 308.7 | $ 308.7 | ||||
Restricted cash | 1.7 | 1.7 | ||||
Percentage rent | $ 0.6 | 0.1 | $ 3.2 | $ 2.9 | ||
Derivative liability collateral posted | $ 1.7 | $ 1.7 | ||||
Number of businesses acquired | business | 2 | |||||
Common Stock | ||||||
Class of Stock [Line Items] | ||||||
Number of shares granted | shares | 40,000 | |||||
Grant date fair value | $ 0.8 | |||||
Issuance of stock and warrants | $ 0.8 |
Summary of Significant Accounting Policies (Derivative Instruments) (Details) - USD ($) $ in Thousands |
1 Months Ended | 9 Months Ended | 12 Months Ended |
---|---|---|---|
Feb. 28, 2017 |
Dec. 31, 2017 |
Dec. 31, 2018 |
|
Derivative [Line Items] | |||
Unrealized gains/(losses) on derivatives | $ 400 | $ 100 | |
Designated as Hedging Instrument | Interest rate swap | |||
Derivative [Line Items] | |||
Derivative asset, fair value, gross asset | 1,042 | ||
Derivative liability, fair value, gross liability | 904 | ||
Designated as Hedging Instrument | Interest rate swap | October 2020 | Deferred expenses and other assets, net | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | 95,000 | ||
Derivative asset, fair value, gross asset | 798 | ||
Designated as Hedging Instrument | Interest rate swap | October 2020 | Deferred expenses and other assets, net | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | 10,000 | ||
Derivative asset, fair value, gross asset | 128 | ||
Designated as Hedging Instrument | Interest rate swap | October 2030 | Deferred expenses and other assets, net | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | 10,000 | ||
Derivative asset, fair value, gross asset | 98 | ||
Designated as Hedging Instrument | Interest rate swap | October 2030 | Accounts payable, accrued expenses and other liabilities | |||
Derivative [Line Items] | |||
Derivative liability, notional amount | 95,000 | ||
Derivative liability, fair value, gross liability | 619 | ||
Designated as Hedging Instrument | Interest rate swap | October 2030 | Accounts payable, accrued expenses and other liabilities | |||
Derivative [Line Items] | |||
Derivative liability, notional amount | 22,000 | ||
Derivative liability, fair value, gross liability | 285 | ||
Designated as Hedging Instrument | Interest rate swap | Reclassification out of Accumulated Other Comprehensive Income | Scenario, Forecast | |||
Derivative [Line Items] | |||
Interest expense | $ 100 | ||
Designated as Hedging Instrument | Interest rate cap | Other expense | |||
Derivative [Line Items] | |||
Derivative, Gain (Loss) on Derivative, Net | (5) | ||
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net [Abstract] | |||
Amount of Gain (Loss) Recognized in Accumulated Other Comprehensive Income (Effective Portion) | 30 | ||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Earnings (Ineffective Portion) | 22 | ||
Designated as Hedging Instrument | Interest rate cap | Interest Expense | |||
Derivative Instruments, Gain (Loss) Recognized in Other Comprehensive Income (Loss), Effective Portion, Net [Abstract] | |||
Amount of Gain (Loss) Reclassified from Accumulated Other Comprehensive Income into Earnings (Effective Portion) | 110 | ||
Designated as Hedging Instrument | Interest rate cap | January 2021 | Deferred expenses and other assets, net | |||
Derivative [Line Items] | |||
Derivative asset, notional amount | 71,000 | ||
Derivative asset, fair value, gross asset | $ 18 |
Summary of Significant Accounting Policies Restricted Cash (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Apr. 13, 2017 |
Dec. 31, 2016 |
---|---|---|---|
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Restricted cash | $ 1,700 | ||
Accounting Standards Update 2016-18 | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Cash and cash equivalents | $ 0 | ||
Restricted cash | 0 | ||
Total cash, cash equivalents and restricted cash reported in the consolidated statement of cash flows | $ 0 | ||
The Company | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Restricted cash | 1,656 | ||
Total cash, cash equivalents and restricted cash reported in the consolidated statement of cash flows | 169,870 | $ 0 | |
The Company | Accounting Standards Update 2016-18 | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Cash and cash equivalents | 168,214 | ||
Restricted cash | 1,656 | ||
Total cash, cash equivalents and restricted cash reported in the consolidated statement of cash flows | $ 169,870 |
Real Estate and Real Estate-Related Intangibles (Real Estate Assets) (Details) - USD ($) |
1 Months Ended | ||
---|---|---|---|
Feb. 28, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Real Estate [Abstract] | |||
Land and land improvements, at cost | $ 220,749,000 | $ 41,160,000 | |
Buildings and improvements, at cost | 192,396,000 | 124,539,000 | |
Less: accumulated depreciation | (4,253,000) | (61,221,000) | |
Total real estate, net | 408,892,000 | 104,478,000 | |
Real estate-related intangible assets, net (refer to Note 4) | 138,725,000 | 32,680,000 | |
Total real estate, net and real estate-related intangible assets, net | $ 547,617,000 | $ 137,158,000 | |
Proceeds from sales of real estate | $ 500,000 | ||
Carrying value of Hilton Western parking facility | $ 0 |
Real Estate and Real Estate-Related Intangibles (Intangibles) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | |
---|---|---|---|---|
Apr. 13, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Finite-Lived Intangible Assets [Line Items] | ||||
Real estate-related intangible assets, net (refer to Note 4) | $ 138,725 | $ 32,680 | ||
Real estate-related intangible liabilities, net | 57,959 | 0 | ||
Ground lease income | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Intangible liabilities, accumulated amortization | 400 | |||
Amortization of intangible liabilities | 400 | |||
Above-market lease assets, net | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Real estate-related intangible assets, net (refer to Note 4) | 77,197 | 0 | ||
Intangible assets, accumulated amortization | 900 | |||
Above-market lease assets, net | Ground lease income | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | (900) | |||
In-place lease assets, net | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Real estate-related intangible assets, net (refer to Note 4) | 35,744 | 0 | ||
Intangible assets, accumulated amortization | 2,200 | |||
In-place lease assets, net | Depreciation and amortization | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | 2,200 | |||
Below-market lease | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Real estate-related intangible assets, net (refer to Note 4) | 25,784 | 0 | ||
Intangible assets, accumulated amortization | 700 | |||
Annual payments to third-party owner of the property | 400 | |||
Below-market lease | Real estate expense | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | 700 | |||
Lease incentives, net | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Real estate-related intangible assets, net (refer to Note 4) | 0 | 32,545 | ||
Intangible assets, accumulated amortization | 2,100 | |||
Lease incentives, net | Ground lease income | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible assets | $ 100 | 400 | $ 300 | |
Other intangible assets, net | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Real estate-related intangible assets, net (refer to Note 4) | $ 0 | $ 135 |
Real Estate and Real Estate-Related Intangibles (Intangible Asset Future Amortization Expense) (Details) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Real Estate [Abstract] | |
2018 | $ 5,376 |
2019 | 5,376 |
2020 | 5,376 |
2021 | 5,376 |
2022 | $ 5,376 |
Real Estate and Real Estate-Related Intangibles (Acquisitions) (Details) $ in Millions |
1 Months Ended | 9 Months Ended | 12 Months Ended | ||
---|---|---|---|---|---|
Aug. 31, 2017
USD ($)
ft²
parking_space
|
Jun. 28, 2017
USD ($)
ft²
parking_space
apartment
|
Oct. 31, 2017
USD ($)
apartment
|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2017
USD ($)
business
|
|
Business Acquisition [Line Items] | |||||
Total consideration | $ 142.0 | ||||
Revenue since acquisition | $ 16.1 | ||||
Net income since acquisition | $ 8.5 | ||||
Number of businesses acquired | business | 2 | ||||
6200 Hollywood Blvd. | |||||
Business Acquisition [Line Items] | |||||
Land subject to ground leases | ft² | 143,151 | ||||
Number of units | apartment | 507 | ||||
Net rentable retail space | ft² | 56,100 | ||||
Number of underground parking spaces | parking_space | 1,237 | ||||
Remaining lease term | 87 years | ||||
6201 Hollywood Blvd. | |||||
Business Acquisition [Line Items] | |||||
Land subject to ground leases | ft² | 183,802 | ||||
Number of units | apartment | 535 | ||||
Net rentable retail space | ft² | 71,200 | ||||
Number of underground parking spaces | parking_space | 1,300 | ||||
Remaining lease term | 87 years | ||||
3333 LifeHope | |||||
Business Acquisition [Line Items] | |||||
Payments to acquire productive assets | $ 16.0 | ||||
Ground leases term | 99 years | ||||
Annual base rent, subject to annual percentage increases | $ 0.9 | ||||
Annual percent rent increase | 2.00% | ||||
Number of parking spaces to be constructed | parking_space | 185 | ||||
Future construction funding, percent authorized | 30.00% | ||||
Additional construction, number of square feet | ft² | 160,000 | ||||
Additional construction funding commitment | $ 24.0 | ||||
Additional construction, funding commitment, term | 1 year | ||||
3333 LifeHope | Real Estate, Net | |||||
Business Acquisition [Line Items] | |||||
Payments to acquire productive assets | $ 6.3 | ||||
3333 LifeHope | Real Estate Related Intangible Assets, Net | |||||
Business Acquisition [Line Items] | |||||
Payments to acquire productive assets | $ 9.7 | ||||
iStar Inc. | Great Oaks | |||||
Business Acquisition [Line Items] | |||||
Number of units | apartment | 301 | ||||
Payments to acquire productive assets | $ 34.0 | ||||
Additional construction funding commitment | $ 80.5 |
Real Estate and Real Estate-Related Intangibles (Purchase Price Allocations) (Details) - USD ($) $ in Thousands |
Jun. 28, 2017 |
Apr. 14, 2017 |
Dec. 31, 2017 |
---|---|---|---|
Assets | |||
Land and land improvements, at cost | $ 214,448 | ||
Buildings and improvements, at cost | 192,396 | ||
Real estate | 406,844 | ||
Real estate-related intangible assets | 132,775 | ||
Other assets | 1,174 | ||
Total assets | 540,793 | ||
Liabilities | |||
Real estate-related intangible liabilities | 58,378 | ||
Debt obligations | 227,415 | ||
Total liabilities | 285,793 | ||
Purchase Price | 255,000 | ||
Total consideration | $ 142,000 | ||
Initial Portfolio from iStar | |||
Assets | |||
Land and land improvements, at cost | 73,472 | ||
Buildings and improvements, at cost | 192,396 | ||
Real estate | 265,868 | ||
Real estate-related intangible assets | 124,017 | ||
Other assets | 1,174 | ||
Total assets | 391,059 | ||
Liabilities | |||
Real estate-related intangible liabilities | 50,644 | ||
Debt obligations | 227,415 | ||
Total liabilities | 278,059 | ||
Purchase Price | 113,000 | ||
Total consideration | $ 340,000 | ||
6200 Hollywood Blvd. | |||
Assets | |||
Land and land improvements, at cost | 68,140 | ||
Buildings and improvements, at cost | 0 | ||
Real estate | 68,140 | ||
Real estate-related intangible assets | 5,500 | ||
Other assets | 0 | ||
Total assets | 73,640 | ||
Liabilities | |||
Real estate-related intangible liabilities | 0 | ||
Debt obligations | 0 | ||
Total liabilities | 0 | ||
Purchase Price | 73,640 | ||
6201 Hollywood Blvd. | |||
Assets | |||
Land and land improvements, at cost | 72,836 | ||
Buildings and improvements, at cost | 0 | ||
Real estate | 72,836 | ||
Real estate-related intangible assets | 3,258 | ||
Other assets | 0 | ||
Total assets | 76,094 | ||
Liabilities | |||
Real estate-related intangible liabilities | 7,734 | ||
Debt obligations | 0 | ||
Total liabilities | 7,734 | ||
Purchase Price | 68,360 | ||
Below-market lease | |||
Liabilities | |||
Annual payments to third-party owner of the property | $ 400 |
Real Estate and Real Estate-Related Intangibles (Pro Forma Information) (Details) - USD ($) $ / shares in Units, $ in Thousands |
9 Months Ended | 12 Months Ended | |
---|---|---|---|
Dec. 31, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
|
Real Estate [Abstract] | |||
Pro forma revenues | $ 25,828 | $ 27,422 | |
Pro forma net income (loss) | $ (803) | $ 5,484 | |
Revenue since acquisition | $ 16,100 | ||
Net income since acquisition | $ 8,500 | ||
Pro forma income (loss) per share (in dollars per share) | $ 0.07 |
Real Estate and Real Estate-Related Intangibles (Future Minimum Ground Net Lease Payments) (Details) $ in Thousands |
Dec. 31, 2017
USD ($)
|
---|---|
Future Minimum Ground Net Lease Payments to be Collected | |
2018 | $ 20,197 |
2019 | 20,270 |
2020 | 20,348 |
2021 | 20,434 |
2022 | 20,513 |
Leases with CPI Based Escalations | |
Future Minimum Ground Net Lease Payments to be Collected | |
2018 | 4,993 |
2019 | 4,993 |
2020 | 4,993 |
2021 | 4,993 |
2022 | 4,993 |
Leases with Fixed Escalations | |
Future Minimum Ground Net Lease Payments to be Collected | |
2018 | 5,172 |
2019 | 5,245 |
2020 | 5,323 |
2021 | 5,409 |
2022 | 5,488 |
Leases with Revenue Participation | |
Future Minimum Ground Net Lease Payments to be Collected | |
2018 | 10,032 |
2019 | 10,032 |
2020 | 10,032 |
2021 | 10,032 |
2022 | $ 10,032 |
Deferred Expenses and Other Assets, Net and Accounts Payable, Accrued Expenses and Other Liabilities (Schedule of Other Assets) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Purchase deposit | $ 2,855 | $ 0 |
Deferred finance costs, net | 2,490 | 0 |
Derivative assets | 1,042 | 0 |
Other assets | 450 | 5,841 |
Leasing costs, net | 92 | 763 |
Deferred expenses and other assets, net | 6,929 | 6,604 |
Debt issuance costs, current | $ 500 | |
Receivable related to the funding provided by investment | 4,100 | |
Deferred offering costs | 1,700 | |
Accumulated amortization on leasing costs | $ 28 |
Deferred Expenses and Other Assets, Net and Accounts Payable, Accrued Expenses and Other Liabilities (Schedule of Other Liabilities) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Dividends declared and payable | $ 2,728 | $ 0 |
Accounts Payable | 1,347 | 779 |
Accrued expenses | 1,285 | 708 |
Derivative liabilities | 904 | 0 |
Interest payable | 660 | 0 |
Other liabilities | 621 | 89 |
Accounts payable, accrued expenses and other liabilities | 7,545 | $ 1,576 |
Payable to the Manager for costs it paid on the Company's behalf | $ 100 |
Debt Obligations, net (Schedule of Debt) (Details) - USD ($) $ in Thousands |
12 Months Ended | |||
---|---|---|---|---|
Dec. 31, 2017 |
Apr. 14, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
|
Debt Instrument [Line Items] | ||||
Total debt obligations | $ 308,000 | $ 0 | ||
Debt premium, net | (926) | 0 | ||
Total debt obligations, net | 307,074 | 0 | ||
Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Total debt obligations | 308,000 | 0 | ||
Debt premium, net | (926) | |||
Total debt obligations, net | 307,074 | |||
2017 Secured Financing | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Total debt obligations | 227,000 | 0 | ||
Debt premium, net | ||||
Total debt obligations, net | ||||
Stated interest rates | 3.795% | 3.795% | ||
Premium | $ 400 | |||
2017 Hollywood Mortgage | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Total debt obligations | $ 71,000 | |||
Debt premium, net | ||||
Total debt obligations, net | ||||
2017 Hollywood Mortgage | Secured Debt | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis point spread on variable interest rate (as a percent) | 1.33% | |||
2017 Revolver | Secured Debt | ||||
Debt Instrument [Line Items] | ||||
Total debt obligations | $ 10,000 | $ 0 | ||
Debt premium, net | ||||
Total debt obligations, net | ||||
2017 Revolver | Secured Debt | LIBOR | ||||
Debt Instrument [Line Items] | ||||
Basis point spread on variable interest rate (as a percent) | 1.35% |
Debt Obligations, net (Narrative) (Details) |
1 Months Ended | 6 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|---|
Jun. 30, 2017
USD ($)
extension
|
Mar. 31, 2017
USD ($)
lease
property
|
Jun. 30, 2017
USD ($)
extension
|
Dec. 31, 2017
USD ($)
|
Mar. 30, 2017
USD ($)
|
Dec. 31, 2016
USD ($)
|
|
Line of Credit Facility [Line Items] | ||||||
Deferred finance costs, net | $ 2,490,000 | $ 0 | ||||
Long-term Debt, Gross | 308,000,000 | 0 | ||||
Secured Debt | ||||||
Line of Credit Facility [Line Items] | ||||||
Long-term Debt, Gross | $ 308,000,000 | 0 | ||||
2017 Secured Financing | Secured Debt | ||||||
Line of Credit Facility [Line Items] | ||||||
Debt instrument, face amount | $ 227,000,000.0 | $ 227,000,000 | ||||
Stated interest rates | 3.795% | 3.795% | ||||
Number of ground net leases collateralizing loan | lease | 7 | |||||
Number of master lease collateralizing loan | lease | 1 | |||||
Number of properties covered under master lease agreement | property | 5 | |||||
Effective interest rate | 3.795% | 3.773% | ||||
Long-term Debt, Gross | $ 227,000,000 | $ 0 | ||||
2017 Hollywood Mortgage | Secured Debt | ||||||
Line of Credit Facility [Line Items] | ||||||
Deferred finance costs, net | 1,300,000 | |||||
Long-term Debt, Gross | $ 71,000,000 | |||||
2017 Hollywood Mortgage | Secured Debt | LIBOR | ||||||
Line of Credit Facility [Line Items] | ||||||
Basis point spread on variable interest rate (as a percent) | 1.33% | |||||
Interest rate swap | ||||||
Line of Credit Facility [Line Items] | ||||||
Notional amount | $ 200,000,000 | |||||
2017 Revolver | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum leverage ratio | 70.00% | |||||
Maximum leverage ratio for 180 day period | 75.00% | |||||
Debt instrument covenant multiple of minimum fixed charges on outstanding borrowings | 1.45 | |||||
Tangible net worth, percent of tangible net worth at date of issuance | 75.00% | |||||
Tangible net worth, percent of future issuances of net equity | 75.00% | |||||
Maximum secured leverage ratio | 70.00% | |||||
Maximum secured leverage ratio for 180 day period | 75.00% | |||||
Covenant description secured recourse debt ratio maximum | 5.00% | |||||
Annualized distribution rate of initial public offering price | 3.00% | |||||
Future annualized distribution rate of adjusted funds from operations | 110.00% | |||||
2017 Revolver | Line of Credit | ||||||
Line of Credit Facility [Line Items] | ||||||
Maximum borrowing capacity | $ 300,000,000.0 | $ 300,000,000.0 | ||||
Debt term | 3 years | |||||
Number of extension options available | extension | 2 | 2 | ||||
Debt extension term | 12 months | |||||
Maximum leverage rate | 67.00% | 67.00% | ||||
Accordion feature, increase limit | $ 500,000,000.0 | $ 500,000,000.0 | ||||
2017 Revolver | Line of Credit | Deferred expenses and other assets, net | ||||||
Line of Credit Facility [Line Items] | ||||||
Deferred finance costs, net | $ 3,000,000 | $ 3,000,000 | ||||
2017 Revolver | Line of Credit | LIBOR | ||||||
Line of Credit Facility [Line Items] | ||||||
Basis point spread on variable interest rate (as a percent) | 1.35% | |||||
Minimum | 2017 Revolver | Line of Credit | ||||||
Line of Credit Facility [Line Items] | ||||||
Unused capacity, commitment fee percentage | 0.15% | |||||
Maximum | 2017 Revolver | Line of Credit | ||||||
Line of Credit Facility [Line Items] | ||||||
Unused capacity, commitment fee percentage | 0.25% |
Debt Obligations, net (Schedule of Debt Maturities) (Details) - USD ($) $ in Thousands |
Dec. 31, 2017 |
Dec. 31, 2016 |
---|---|---|
Debt Instrument [Line Items] | ||
Total principal maturities | $ 308,000 | $ 0 |
Debt premium and deferred financing costs, net | (926) | 0 |
Total debt obligations, net | 307,074 | 0 |
Secured Debt | ||
Debt Instrument [Line Items] | ||
2018 | 0 | |
2019 | 0 | |
2020 | 0 | |
2021 | 0 | |
2022 | 10,000 | |
Thereafter | 298,000 | |
Total principal maturities | 308,000 | 0 |
Debt premium and deferred financing costs, net | (926) | |
Total debt obligations, net | 307,074 | |
Secured Debt | 2017 Secured Financing | ||
Debt Instrument [Line Items] | ||
2018 | 0 | |
2019 | 0 | |
2020 | 0 | |
2021 | 0 | |
2022 | 0 | |
Thereafter | 227,000 | |
Total principal maturities | 227,000 | 0 |
Debt premium and deferred financing costs, net | ||
Total debt obligations, net | ||
Secured Debt | 2017 Hollywood Mortgage | ||
Debt Instrument [Line Items] | ||
2018 | 0 | |
2019 | 0 | |
2020 | 0 | |
2021 | 0 | |
2022 | 0 | |
Thereafter | 71,000 | |
Total principal maturities | 71,000 | |
Debt premium and deferred financing costs, net | ||
Total debt obligations, net | ||
Secured Debt | 2017 Revolver | ||
Debt Instrument [Line Items] | ||
2018 | 0 | |
2019 | 0 | |
2020 | 0 | |
2021 | 0 | |
2022 | 10,000 | |
Thereafter | 0 | |
Total principal maturities | 10,000 | $ 0 |
Debt premium and deferred financing costs, net | ||
Total debt obligations, net |
Commitments and Contingencies (Details) $ in Millions |
1 Months Ended |
---|---|
Oct. 31, 2017
USD ($)
| |
iStar Inc. | Great Oaks | |
Long-term Purchase Commitment [Line Items] | |
Unfunded commitment | $ 34.0 |
Risk Management (Details) $ in Millions |
12 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
hotel
| |
Revenue | Customer Concentration Risk | Tenant 1 | |
Concentration Risk [Line Items] | |
Revenue | $ 10.4 |
Concentration risk percentage | 45.00% |
Revenue | Customer Concentration Risk | Tenant 2 | |
Concentration Risk [Line Items] | |
Revenue | $ 5.3 |
Concentration risk percentage | 23.00% |
Assets | Product Concentration Risk | |
Concentration Risk [Line Items] | |
Concentration risk percentage | 30.00% |
Number of hotels leased | hotel | 5 |
Equity (Narrative) (Details) $ / shares in Units, $ in Millions |
2 Months Ended | 12 Months Ended | |||
---|---|---|---|---|---|
Feb. 15, 2018
$ / shares
|
Jun. 27, 2017
USD ($)
shares
|
Apr. 14, 2017
USD ($)
investor
shares
|
Feb. 15, 2018
USD ($)
$ / shares
shares
|
Dec. 31, 2017
USD ($)
plan
$ / shares
shares
|
|
Class of Stock [Line Items] | |||||
Number of institutional investors | investor | 2 | ||||
Dividends declared, per share (usd per share) | $ / shares | $ 0.3066 | ||||
IPO | |||||
Class of Stock [Line Items] | |||||
Proceeds from initial public offering | $ 205.0 | ||||
Proceeds from private placement offering | $ 45.0 | ||||
Common Stock | Initial Capitalization | |||||
Class of Stock [Line Items] | |||||
Number of institutional investors | investor | 2 | ||||
Stock issued (in shares) | shares | 2,875,000 | ||||
Proceeds from issuance of common stock | $ 57.5 | ||||
Common Stock | IPO | |||||
Class of Stock [Line Items] | |||||
Stock issued (in shares) | shares | 10,250,000 | ||||
Proceeds from initial public offering | $ 205.0 | ||||
Common Stock | Director Compensation | |||||
Class of Stock [Line Items] | |||||
Stock issued (in shares) | shares | 40,000 | ||||
Common Stock | iStar Inc. | Initial Capitalization | |||||
Class of Stock [Line Items] | |||||
Stock issued (in shares) | shares | 2,775,000 | ||||
Proceeds from issuance of common stock | $ 55.5 | ||||
Common Stock | iStar Inc. | IPO | |||||
Class of Stock [Line Items] | |||||
Stock issued (in shares) | shares | 2,250,000 | ||||
Proceeds from private placement offering | $ 45.0 | ||||
Common Stock | iStar Inc. | Private Placement | |||||
Class of Stock [Line Items] | |||||
Number of shares issued in transaction | shares | 1,800,000 | ||||
Consideration received on transaction | $ 34.1 | ||||
Average cost per share (usd per share) | $ / shares | $ 18.85 | ||||
Number of 10b5-1 Plans | plan | 2 | ||||
Sale of Stock, Percentage of Ownership before Transaction | 37.60% | ||||
Common Stock | Jay Sugarman Trust and Geoffrey Jervis Trusts | IPO | |||||
Class of Stock [Line Items] | |||||
Amount of common stock iStar could purchase in accordance with 10b5-1 and 10b-18 | $ 0.5 | ||||
Common Stock | Jay Sugarman Trust and Geoffrey Jervis Trusts | Private Placement | |||||
Class of Stock [Line Items] | |||||
Number of shares issued in transaction | shares | 26,000 | ||||
Consideration received on transaction | $ 0.5 | ||||
Average cost per share (usd per share) | $ / shares | $ 19.20 | ||||
Subsequent Event | Common Stock | iStar Inc. | Private Placement | |||||
Class of Stock [Line Items] | |||||
Number of shares issued in transaction | shares | 400,000 | ||||
Consideration received on transaction | $ 7.6 | ||||
Average cost per share (usd per share) | $ / shares | $ 17.92 | $ 17.92 | |||
Ownership percentage after transaction | 39.90% | ||||
Maximum | Common Stock | iStar Inc. | Private Placement | |||||
Class of Stock [Line Items] | |||||
Ownership percentage after transaction | 39.90% |
Equity (Schedule of Ownership) (Details) - $ / shares |
Dec. 31, 2017 |
Jun. 27, 2017 |
Apr. 14, 2017 |
---|---|---|---|
Class of Stock [Line Items] | |||
Stock issued (in shares) | 18,190,000 | ||
IPO | |||
Class of Stock [Line Items] | |||
Share price (in dollars per share) | $ 20.00 | ||
Director Compensation | |||
Class of Stock [Line Items] | |||
Stock issued (in shares) | 40,000 | ||
Third Parties | Initial Capitalization | |||
Class of Stock [Line Items] | |||
Stock issued (in shares) | 2,875,000 | ||
Third Parties | IPO | |||
Class of Stock [Line Items] | |||
Stock issued (in shares) | 10,250,000 | ||
iStar Inc. | Initial Capitalization | |||
Class of Stock [Line Items] | |||
Stock issued (in shares) | 2,775,000 | ||
iStar Inc. | IPO | |||
Class of Stock [Line Items] | |||
Stock issued (in shares) | 2,250,000 | ||
Common Stock | Initial Capitalization | |||
Class of Stock [Line Items] | |||
Share price (in dollars per share) | $ 20.00 | ||
Common Stock | Third Parties | Initial Capitalization | |||
Class of Stock [Line Items] | |||
Share price (in dollars per share) | 20 | ||
Common Stock | Third Parties | IPO | |||
Class of Stock [Line Items] | |||
Share price (in dollars per share) | $ 20 | ||
Common Stock | iStar Inc. | Initial Capitalization | |||
Class of Stock [Line Items] | |||
Share price (in dollars per share) | $ 20.00 | ||
Common Stock | iStar Inc. | IPO | |||
Class of Stock [Line Items] | |||
Share price (in dollars per share) | $ 20 |
Earnings Per Share (Schedule of Earnings Per Share) (Details) $ in Thousands |
9 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
| |
Earnings Per Share [Abstract] | |
Income (loss) from operations | $ (3,669) |
Earnings Per Share (Earnings Allocable to Common Shares) (Details) $ / shares in Units, shares in Thousands, $ in Thousands |
9 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
$ / shares
shares
| |
Numerator for basic earnings per share: | |
Income (loss) from operations attributable to Safety, Income & Growth Inc. and allocable to common shareholders | $ (3,669) |
Net income (loss) Basic and Diluted | $ (3,669) |
Denominator for basic and diluted earnings per share: | |
Weighted average common shares outstanding for basic and diluted earnings per common share (in shares) | shares | 14,648 |
Per common share data: | |
Net income (loss) attributable to Safety, Income and Growth, Inc. and allocable to common shareholders (in dollars per share) | $ / shares | $ (0.25) |
Related Party Transactions (Narrative) (Details) |
6 Months Ended | 9 Months Ended | 12 Months Ended | |
---|---|---|---|---|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2017
USD ($)
|
Dec. 31, 2017
USD ($)
|
Sep. 30, 2017
USD ($)
employee
office
|
|
Related Party Transaction [Line Items] | ||||
Management fee expense, percent of equity below threshold | 0.75% | |||
Management fee expense, percent of equity above threshold | 1.00% | |||
Management fee expense, Shareholders' equity threshold | $ 2,500,000,000.0 | $ 2,500,000,000.0 | $ 2,500,000,000.0 | |
Management fee paid with common stock, period of restriction from selling stock | 2 years | |||
Management contract, period | 1 year | |||
Management fee expense | $ 0 | |||
General and Administrative Expense | ||||
Related Party Transaction [Line Items] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | 2,000,000 | |||
iStar Inc. | ||||
Related Party Transaction [Line Items] | ||||
Number of years as active real estate investor (over) | 20 years | |||
Real estate investments, aggregate transactions, value | 35,000,000,000 | $ 35,000,000,000 | $ 35,000,000,000 | |
Assets | $ 5,800,000,000 | |||
Entity number of employees | employee | 189 | |||
Number of regional offices | office | 7 | |||
iStar Inc. | General and Administrative Expense | ||||
Related Party Transaction [Line Items] | ||||
Related Party Transaction, Expenses from Transactions with Related Party | $ 600,000 |
Quarterly Financial Information (Unaudited) (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | |||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Apr. 13, 2017 |
Dec. 31, 2017 |
Sep. 30, 2017 |
Jun. 30, 2017 |
Apr. 13, 2017 |
Mar. 31, 2017 |
Dec. 31, 2016 |
Sep. 30, 2016 |
Jun. 30, 2016 |
Mar. 31, 2016 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||||
Net income | [1] | $ 1,846 | $ 6,615 | $ 5,349 | ||||||||||||||||||||
Earnings per common share data: | ||||||||||||||||||||||||
Net income (loss) Basic and diluted (in dollars per share) | $ (0.25) | |||||||||||||||||||||||
Weighted average number of common shares: Basic and diluted (in shares) | 14,648 | |||||||||||||||||||||||
The Company | ||||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||||
Revenue | $ 6,750 | $ 6,256 | $ 4,204 | $ 7,706 | $ 4,772 | $ 4,672 | $ 17,210 | |||||||||||||||||
Net income | $ (1,344) | $ (721) | $ (1,604) | $ 3,699 | $ 949 | $ 1,053 | $ (3,669) | |||||||||||||||||
Earnings per common share data: | ||||||||||||||||||||||||
Net income (loss) Basic and diluted (in dollars per share) | $ (0.07) | $ (0.04) | $ (0.25) | $ (0.25) | ||||||||||||||||||||
Weighted average number of common shares: Basic and diluted (in shares) | 18,190 | 18,190 | 6,293 | 14,648 | ||||||||||||||||||||
Predecessor | ||||||||||||||||||||||||
Class of Stock [Line Items] | ||||||||||||||||||||||||
Revenue | $ 691 | 6,024 | [2] | $ 5,333 | $ 4,593 | 21,743 | [2] | 18,565 | [2] | |||||||||||||||
Net income | $ 54 | $ 1,846 | [1],[2],[3],[4] | $ 1,792 | $ 914 | $ 6,615 | [1],[2],[3],[4] | $ 5,717 | [1],[2],[3],[4] | |||||||||||||||
|
Subsequent Events (Details) - Subsequent Event - Onyx on First $ in Millions |
Jan. 25, 2018
USD ($)
|
---|---|
Subsequent Event [Line Items] | |
Payments to acquire productive assets | $ 38.5 |
Lease term | 99 years |
Schedule III - Real Estate and Accumulated Depreciation (Schedule of Real Estate Assets) (Details) - Mixed Use Collateral $ in Thousands |
12 Months Ended |
---|---|
Dec. 31, 2017
USD ($)
| |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 298,000 |
Initial Cost to Company, Land | 220,749 |
Initial Cost to Company, Building and Improvements | 192,396 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 220,749 |
Gross Amount Carried at Close of Period, Building and Improvements | 192,396 |
Gross Amount Carried at Close of Period, Total | 413,145 |
Accumulated Depreciation | 4,253 |
Aggregate cost for federal income tax purposes | $ 467,900 |
Minimum | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Depreciable Life (Years) | 7 years |
Maximum | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Depreciable Life (Years) | 12 years |
Detroit, MI | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 31,961 |
Initial Cost to Company, Land | 29,086 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 29,086 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 29,086 |
Accumulated Depreciation | 0 |
Dallas, TX | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 3,736 |
Initial Cost to Company, Land | 1,954 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 1,954 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 1,954 |
Accumulated Depreciation | 0 |
Dallas, TX | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 4,151 |
Initial Cost to Company, Land | 2,751 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 2,751 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 2,751 |
Accumulated Depreciation | 0 |
Atlanta, GA | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 7,577 |
Initial Cost to Company, Land | 4,097 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 4,097 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 4,097 |
Accumulated Depreciation | 0 |
Milwaukee, WI | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 3,633 |
Initial Cost to Company, Land | 4,638 |
Initial Cost to Company, Building and Improvements | 51,323 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 4,638 |
Gross Amount Carried at Close of Period, Building and Improvements | 51,323 |
Gross Amount Carried at Close of Period, Total | 55,961 |
Accumulated Depreciation | $ 916 |
Depreciable Life (Years) | 40 years |
Washington, DC | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 5,190 |
Initial Cost to Company, Land | 1,484 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 1,484 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 1,484 |
Accumulated Depreciation | 0 |
Minneapolis, MN | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 1,452 |
Initial Cost to Company, Land | 716 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 716 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 716 |
Accumulated Depreciation | 0 |
Durango, CO | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 16,604 |
Initial Cost to Company, Land | 1,415 |
Initial Cost to Company, Building and Improvements | 17,080 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 1,415 |
Gross Amount Carried at Close of Period, Building and Improvements | 17,080 |
Gross Amount Carried at Close of Period, Total | 18,495 |
Accumulated Depreciation | $ 387 |
Depreciable Life (Years) | 35 years |
Rohnert Park, CA | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 19,300 |
Initial Cost to Company, Land | 5,869 |
Initial Cost to Company, Building and Improvements | 13,752 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 5,869 |
Gross Amount Carried at Close of Period, Building and Improvements | 13,752 |
Gross Amount Carried at Close of Period, Total | 19,621 |
Accumulated Depreciation | $ 387 |
Depreciable Life (Years) | 32 years |
Salt Lake City, UT | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 55,312 |
Initial Cost to Company, Land | 8,573 |
Initial Cost to Company, Building and Improvements | 40,583 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 8,573 |
Gross Amount Carried at Close of Period, Building and Improvements | 40,583 |
Gross Amount Carried at Close of Period, Total | 49,156 |
Accumulated Depreciation | $ 847 |
Depreciable Life (Years) | 34 years |
San Diego, CA | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 38,084 |
Initial Cost to Company, Land | 5,077 |
Initial Cost to Company, Building and Improvements | 24,096 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 5,077 |
Gross Amount Carried at Close of Period, Building and Improvements | 24,096 |
Gross Amount Carried at Close of Period, Total | 29,173 |
Accumulated Depreciation | $ 532 |
Depreciable Life (Years) | 33 years |
Seattle, WA | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 40,000 |
Initial Cost to Company, Land | 7,813 |
Initial Cost to Company, Building and Improvements | 45,562 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 7,813 |
Gross Amount Carried at Close of Period, Building and Improvements | 45,562 |
Gross Amount Carried at Close of Period, Total | 53,375 |
Accumulated Depreciation | $ 1,184 |
Depreciable Life (Years) | 30 years |
Los Angeles, CA | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | $ 36,920 |
Initial Cost to Company, Land | 68,140 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 68,140 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 68,140 |
Accumulated Depreciation | 0 |
Los Angeles, CA | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 34,080 |
Initial Cost to Company, Land | 72,836 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 72,836 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 72,836 |
Accumulated Depreciation | 0 |
Atlanta, GA | |
SEC Schedule III, Real Estate and Accumulated Depreciation [Line Items] | |
Encumbrances | 0 |
Initial Cost to Company, Land | 6,300 |
Initial Cost to Company, Building and Improvements | 0 |
Cost Capitalized Subsequent to Acquisition | 0 |
Gross Amount Carried at Close of Period, Land | 6,300 |
Gross Amount Carried at Close of Period, Building and Improvements | 0 |
Gross Amount Carried at Close of Period, Total | 6,300 |
Accumulated Depreciation | $ 0 |
Schedule III - Real Estate and Accumulated Depreciation (Real Estate Reconciliation) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | |
---|---|---|---|---|
Apr. 13, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
The Company | ||||
SEC Schedule III, Reconciliation of Carrying Amount of Real Estate Investments [Roll Forward] | ||||
Beginning balance | $ 0 | |||
Acquisitions | 413,145 | |||
Ending balance | $ 0 | 413,145 | ||
Predecessor | ||||
SEC Schedule III, Reconciliation of Carrying Amount of Real Estate Investments [Roll Forward] | ||||
Beginning balance | 165,699 | $ 165,699 | $ 161,784 | $ 156,410 |
Acquisitions | 0 | 3,915 | 5,374 | |
Ending balance | $ 165,699 | $ 165,699 | $ 161,784 |
Schedule III - Real Estate and Accumulated Depreciation (Accumulated Depreciation Reconciliation) (Details) - USD ($) $ in Thousands |
3 Months Ended | 9 Months Ended | 12 Months Ended | |
---|---|---|---|---|
Apr. 13, 2017 |
Dec. 31, 2017 |
Dec. 31, 2016 |
Dec. 31, 2015 |
|
Predecessor | ||||
SEC Schedule III, Reconciliation of Real Estate Accumulated Depreciation [Roll Forward] | ||||
Beginning balance | $ 61,221 | $ 62,115 | $ 58,104 | $ 54,987 |
Additions | (894) | (3,117) | (3,117) | |
Ending balance | 62,115 | $ 61,221 | $ 58,104 | |
The Company | ||||
SEC Schedule III, Reconciliation of Real Estate Accumulated Depreciation [Roll Forward] | ||||
Beginning balance | 0 | |||
Additions | (4,253) | |||
Ending balance | $ 0 | $ 4,253 |
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