Investments in Unconsolidated Entities

12 Months Ended

Dec. 31, 2022

Equity Method Investments and Joint Ventures [Abstract]

9. Investments in Unconsolidated Entities

The Partnership has non-controlling investments in unconsolidated entities. The Partnership applies the equity method of accounting by initially recording these investments at cost, subsequently adjusted for accrued preferred returns, the Partnership’s share of earnings (losses) of the unconsolidated entities, cash contributions, and distributions. The carrying value of the equity investments represents the Partnership’s maximum exposure to loss. The Partnership is entitled to a preferred return on invested capital in each unconsolidated entity. An affiliate of the Vantage unconsolidated entities guarantees a preferred return on the Partnership’s investments through a date approximately five years after commencement of construction. The Partnership’s preferred return is reported as “Investment income” on the Partnership’s consolidated statements of operations.

The following table provides the details of the investments in unconsolidated entities as of December 31, 2022 and 2021:


Property Name	Location	Units		Construction Commencement Date	Construction Completion Date	Carrying Value as of December 31, 2022		Carrying Value as of December 31, 2021
Current Investments
Vantage at Stone Creek	Omaha, NE		294	March 2018	April 2020	$	5,465,967	$	6,143,099
Vantage at Coventry	Omaha, NE		294	September 2018	February 2021		6,826,584		7,611,614
Vantage at Conroe	Conroe, TX		288	April 2019	January 2021		10,424,625		11,164,625
Vantage at Tomball	Tomball, TX		288	August 2020	April 2022		13,051,936		11,814,774
Vantage at Hutto	Hutto, TX		288	December 2021	N/A		12,590,292		5,629,651
Vantage at Loveland	Loveland, CO		288	April 2021	N/A		18,109,568		10,913,911
Vantage at Helotes	Helotes, TX		288	May 2021	November 2022		14,029,032		11,350,686
Vantage at Fair Oaks	Boerne, TX		288	September 2021	N/A		12,000,297		6,424,306
Vantage at McKinney Falls	McKinney Falls, TX		288	December 2021	N/A		12,253,749		6,530,009
Freestone Greeley	Greeley, CO		296	N/A	N/A		4,775,708		-
Freestone Cresta Bella	San Antonio, TX		296	N/A	N/A		6,263,083		-
Subtotal							115,790,841		77,582,675

Sold Investments
Vantage at Murfreesboro	Murfreesboro, TN		288	September 2018	October 2020	$	-	$	12,240,000
Vantage at O'Connor	San Antonio, TX		288	October 2019	June 2021		-		9,109,343
Vantage at Westover Hills	San Antonio, TX		288	January 2020	July 2021		-		8,861,504
Subtotal							-		30,210,847

						$	115,790,841	$	107,793,522

The Partnership has remaining commitments to provide additional equity funding for certain unconsolidated entities as of December 31, 2022. See Note 18 for further details regarding the Partnership's remaining funding commitments.

Activity in 2022

Sales Activity:

The following table summarizes sales information of the Partnership’s investments in unconsolidated entities during 2022:


Property Name	Location	Units		Month Sold	Gross Proceeds to the Partnership		Investment Income		Gain on Sale
Vantage at Murfreesboro	Murfreesboro, TN		288	March 2022	$	29,399,532	$	657,937	$	16,501,596
Vantage at Westover Hills	San Antonio, TX		288	May 2022		20,923,784		-		12,658,501
Vantage at Bulverde	Bulverde, TX		288	(1)		60,000		-		60,000
Vantage at Germantown	Germantown, TN		288	(2)		4,407		-		4,407
Vantage at O'Connor	San Antonio, TX		288	July 2022		19,381,976		1,195		10,580,781
					$	69,769,699	$	659,132	$	39,805,285

(1)

During 2022, the Partnership received net cash of approximately $60,000 associated with final settlements of the Vantage at Bulverde sale in August 2021. The Partnership recognized the full amount as "Gain on sale of investment in an unconsolidated entity" on the Partnership’s consolidated statements of operations.

(2)

During 2022, the Partnership received cash of approximately $4,000 associated with final settlements of the Vantage at Germantown sale in March 2021. The Partnership recognized the full amount as "Gain on sale of investment in an unconsolidated entity" on the Partnership’s consolidated statements of operations.

New Equity Commitments:

In October 2022, the Partnership executed a $16.0 million equity commitment to fund the construction of the Freestone Greeley multifamily property.

In November 2022, the Partnership executed a $16.4 million equity commitment to fund the construction of the Freestone Cresta Bella multifamily property.

Activity in 2021

Sales Activity:

The following table summarizes sales information of the Partnership’s investments in unconsolidated entities during 2021:


Property Name	Location	Units		Month Sold	Gross Proceeds to the Partnership		Investment Income		Gain on Sale
Vantage at Germantown	Germantown, TN		288	March 2021	$	16,096,560	$	862,454	$	2,809,106
Vantage at Powdersville	Powdersville, SC		288	May 2021		20,118,680		2,359,394		5,463,484
Vantage at Bulverde	Bulverde, TX		288	August 2021		18,916,961		1,392,312		6,954,649
Vantage at Panama City Beach	Panama City Beach, FL		288	(1)		293,510		-		293,510
					$	55,425,711	$	4,614,160	$	15,520,749

(1)

In November 2021, the Partnership received cash of approximately $294,000 upon the resolution of gain contingencies related to the sale of Vantage at Panama
City Beach in September 2019. The Partnership recognized the full amount as "Gain on sale of investment in an unconsolidated entity" on the Partnership’s
consolidated statements of operations.

New and Amended Equity Commitments:

In April 2021, the Partnership executed a $16.3 million equity commitment to fund the construction of the Vantage at Loveland multifamily property.

In May 2021, the Partnership executed a $12.6 million equity commitment to fund the construction of the Vantage at Helotes multifamily property.

In September 2021, Vantage at Fair Oaks ceased to be a consolidated VIE (Note 5) and the Partnership executed an $11.0 million commitment to fund the construction of the property.

In December 2021, the Partnership executed a $11.4 million equity commitment to fund the construction of the Vantage at McKinney Falls multifamily property.

In December 2021, the Partnership increased its total equity commitment related to the Vantage at Hutto multifamily property from $10.5 million to $11.2 million.

Summarized Unconsolidated Entity Level Financial Data

The following table provides summary combined financial information for the properties underlying the Partnership’s investments in unconsolidated entities for the years ended December 31, 2022 and 2021:


	For the Years Ended December 31,
	2022		2021
Property Revenues	$	22,048,926	$	24,501,799
Gain on sale of property	$	87,602,712	$	42,792,935
Net income	$	83,943,337	$	37,836,191