Real Estate Investments

12 Months Ended

Dec. 31, 2014

Real Estate [Abstract]

Real Estate Disclosure [Text Block]

(4) Real Estate Investments –

The Partnership leases its properties to tenants under net leases, classified as operating leases. Under a net lease, the tenant is responsible for real estate taxes, insurance, maintenance, repairs and operating expenses for the property. For some leases, the Partnership is responsible for repairs to the structural components of the building, the roof, and the parking lot. At the time the properties were acquired, the remaining primary lease terms varied from 10 to 20 years, except for the Staples store, which had a remaining primary term of 8.4 years. The leases provide the tenants with two to five five-year renewal options subject to the same terms and conditions as the primary term.

The Partnership's properties are commercial, single-tenant buildings. The Johnny Carino’s restaurant was constructed in 1999 and acquired in 2003. The Advance Auto Parts store was constructed in 2005 and acquired in 2006. The Applebee’s restaurant was constructed in 1996 and acquired in 2006. The Tractor Supply Company store was constructed in 2005 and acquired in 2007. The Best Buy store was constructed and acquired in 2008. The Staples store was constructed in 2010 and acquired in 2011. The PetSmart store was constructed and acquired in 2012. The St. Vincent Medical Clinic was constructed in 2010 and acquired in 2013. There have been no costs capitalized as improvements subsequent to the acquisitions. 

The cost of the properties not held for sale and related accumulated depreciation at December 31, 2014 are as follows:

Property	Land		Buildings		Total		Accumulated Depreciation
Advance Auto Parts, Indianapolis, IN	$	537,914	$	706,259	$	1,244,173	$	227,176
Applebee’s, Crawfordsville, IN		506,030		1,350,626		1,856,656		432,200
Tractor Supply, Grand Forks, ND		238,547		1,165,327		1,403,874		370,962
Best Buy, Lake Geneva, WI		335,142		1,687,104		2,022,246		418,963
Staples, Clermont, FL		239,400		540,935		780,335		69,419
PetSmart, Galveston TX		340,000		280,048		620,048		31,272
St. Vincent Medical Clinic, Lonoke AR		170,000		898,523		1,068,523		55,409
	$	2,367,033	$	6,628,822	$	8,995,855	$	1,605,401

For the years ended December 31, 2014 and 2013, the Partnership recognized depreciation expense for properties not held for sale of $265,152 and $248,679, respectively.

On June 6, 2013, the Partnership purchased a St. Vincent Medical Clinic in Lonoke, Arkansas for $1,680,000. The Partnership allocated $611,477 of the purchase price to Acquired Intangible Lease Assets, representing in-place lease intangibles of $179,987 and above-market lease intangibles of $431,490. The Partnership incurred $35,444 of acquisition expenses related to the purchase that were expensed. The property is leased to St. Vincent Health System under a Lease Agreement with a remaining primary term of 10.4 years (as of the date of purchase) and annual rent of $131,642.

The following schedule presents the cost and related accumulated amortization of acquired lease intangibles not held for sale at December 31:

		2014				2013
		Cost		Accumulated Amortization		Cost		Accumulated Amortization
In-Place Lease Intangibles  (weighted average life of 89 and 101 months, respectively)	$	418,089	$	103,666	$	418,089	$	60,377
Above-Market Lease Intangibles  (weighted average life of 103 and 115 months, respectively)		514,793		87,800		514,793		38,047
Acquired Intangible Lease Assets	$	932,882	$	191,466	$	932,882	$	98,424

For the years ended December 31, 2014 and 2013, the value of in-place lease intangibles amortized to expense was $43,289 and $36,089 and the decrease to rental income for above-market leases was $49,753 and $32,493, respectively. For lease intangibles not held for sale at December 31, 2014, the estimated amortization expense is $43,289 and the estimated decrease to rental income is $49,753 for each of the next five succeeding years.

For properties owned as of December 31, 2014, the minimum future rent payments required by the leases are as follows:

2015	$	774,046
2016		790,461
2017		804,352
2018		809,548
2019		677,289
Thereafter		2,075,233
	$	5,930,929

There were no contingent rents recognized in 2014 and 2013.