Real Estate Assets

12 Months Ended

Dec. 31, 2019

8. Real Estate Assets

The Partnership owns MF Properties either directly or through a wholly owned subsidiary, as described in Note 2. The financial statements of the MF properties are consolidated with those of the Partnership. The Partnership also invests in land with plans to develop into rental properties or for future sale. These investments are reported as “Land held for development” below.

The following tables summarize information regarding the Partnership’s real estate assets as of December 31, 2019 and 2018:

Real Estate Assets as of December 31, 2019
Property Name	Location	Number of Units		Land and Land Improvements		Buildings and Improvements		Carrying Value
Suites on Paseo	San Diego, CA		384	$	3,199,268	$	39,073,728	$	42,272,996
The 50/50 MF Property	Lincoln, NE		475		-		32,937,805		32,937,805
Land held for development		⁽¹⁾			1,706,862		-		1,706,862
								$	76,917,663
Less accumulated depreciation									(15,357,700	)
Total real estate assets								$	61,559,963

(1)	Land held for development consists of parcels of land in Gardner, KS and Richland County, SC and land development costs for a site in Omaha, NE.

Real Estate Assets as of December 31, 2018
Property Name	Location	Number of Units		Land and Land Improvements		Buildings and Improvements		Carrying Value
Suites on Paseo	San Diego, CA		384	$	3,195,468	$	38,961,163	$	42,156,631
The 50/50 MF Property	Lincoln, NE		475		-		32,935,907		32,935,907
Land held for development		⁽²⁾			1,776,197		-		1,776,197
								$	76,868,735
Less accumulated depreciation									(12,272,387	)
Total real estate assets								$	64,596,348

(2)	Land held for development consists of parcels of land in Gardner, KS and Richland County, SC and land development costs for a site in Omaha, NE.

Activity in 2019

In September 2019 and 2018, the Partnership determined that the land held for development in Gardner, KS was impaired. The Partnership recorded impairment charges of $75,000 and $150,000 in the third quarter of 2019 and 2018, respectively. The impairment charges represent the difference between the Partnership’s carrying value and the estimated fair value of the land. The fair value was determined using Level 3 inputs (see Note 23).

In November 2019, the Partnership executed a purchase agreement for a parcel of land in Escondido, CA. The purchase is expected to close in the first quarter of 2020.

Activity in 2018

During 2018, the Partnership sold the Jade Park MF Property to an unrelated third party. The table below summarizes information related to the sale. The gain on sale is considered either Tier 2 or Tier 3 income (see Note 3). The Partnership determined the sales did not meet the criteria for discontinued operations.

Property Name

Month Sold

Property Location

Units

Gross Proceeds

Gain on Sale

before Income

Taxes

Jade Park

September

Daytona, FL

144

13,450,000

4,051,429

During 2018, the Partnership determined that the land held for development in Gardner, KS was impaired. The Partnership recorded an impairment charge of $150,000 during the third quarter of 2018, which represents the difference between the Partnership’s carrying value and the estimated fair value of the land. The fair value was determined using Level 3 inputs (see Note 23).