Discontinued Operations (Tables)

9 Months Ended

Sep. 30, 2017

Discontinued Operations and Disposal Groups [Abstract]

Schedule of discontinued operations activity

i. Current assets of disposal group classified as held for discontinued operations

	2017 $	2016 $
Accounts receivable	310	2,406
Other assets	16,892	209,1520
Due from related party	103,566	–
Total	120,768	211,558

ii. Non-current assets of disposal group classified as held for discontinued operations

	2017 $	2016 $
Land	1,663,713	6,736,848
Building and improvements, net	687,415	4,390,398
Loan receivable – related party	242,979	–
Total	2,594,107	11,127,246

iii. Current liabilities of disposal group classified as held for discontinued operations

	2017 $	2016 $
Accounts payable and accrued liabilities	38,411	119,291
Due to related parties	136	7,164
Note payable – related parties	–	74,307
Prepaid rent received	1,780	13,048
Note payable	6,870	386,656
Total	47,197	600,466

iv. Non-current liabilities of disposal group classified as held for discontinued operations

	2017 $	2016 $
Note payable	652,836	4,690,077
Total	652,836	4,690,077

 Analysis of the result of discontinued operations, and the result on the re-measurement of assets is as follows:

	For the Three Months Ended September 30, 2017 $			For the Three Months Ended September 30, 2016 $			April 6, 2017 through September 30, 2017 $			January 1, 2017 through April 6, 2017 $			For the Nine Months Ended September 30, 2016 $
		Successor			Predecessor			Successor			Predecessor			Predecessor
Revenue		44,496			175,695			192,782			170,819			503,210
Expenses
Depreciation		25,767			43,864			56,772			43,269			109,259
General and administrative		728,346			1,261,364			1,266,236			421,434			3,498,539
Interest expense		35,385			91,038			102,617			78,371			286,526
Total expenses		789,498			1,396,266			1,425,625			543,074			3,894,324
Net loss before other income (expenses) from discontinued operations		(745,002	)		(1,220,571	)		(1,232,843	)		(372,255	)		(3,391,114	)
Interest Income		1,389			—			1,389			—			—
(Loss) gain on sale of properties		(661,672	)		—			(728,839	)		269,521			4,981
Impairment of real estate properties		(149,860	)		—			(277,762	)		(37,071	)		—
Loss from disposal of subsidiary		(1,066,426	)		—			(1,066,426	)		—			—
Net loss from discontinued operations		(2,621,571	)		(1,220,571	)		(3,304,481	)		(139,805	)		(3,386,133	)

Cash flows:

	For the Six Months Ended September 30, 2017			For the Three Months Ended March 31, 2017			For the Nine Months Ended September 30, 2016
		Successor			Predecessor			Predecessor
Operating activities
Net loss from discontinued operations		(3,304,481	)		(139,805	)		(3,386,133	)
Items not affecting cash:
Depreciation		56,772			43,269			109,260
Loss (gain) on sale of assets		728,839			(269,521	)		(4,981	)
Impairment of real estate properties		277,762			37,071			—
Stock-based compensation		—			—			1,950,794
Write-off of accounts receivable		—			1,950			—
Loss on disposal of subsidiary		1,066,426			—			—
Imputed Interest		(1,389	)		—			—
Changes in operating assets and liabilities:
Accounts receivable		(5,030	)		(5,826	)		(6,188	)
Prepaid expenses		148,870			40,145			(39,566	)
Accounts payable		(45,783	)		(2,130	)		21,785
Accrued liabilities		(42,830	)		20,357			31,575
Prepaid rent received		(12,214	)		946			(15,760	)
Due to related parties		1,792			18,330			16,905
Net cash used in operating activities – discontinued operations		(1,131,266	)		(255,214	)		(1,322,309	)
Investing activities
Purchase of real estate properties and improvements		(11,005	)		(3,592	)		(22,908	)
Proceeds from sale of real estate properties, net		3,258,951			384,996			211,200
Proceeds from sale of subsidiary		22,651			—			—
Net cash provided by investing activities – discontinued operations		3,270,597			381,404			188,292
Financing activities
Advances received from related party		5,000			—			—
Proceeds from notes payable		—			—			325,232
Repayment of related party note payable		(1,478	)		(1,685	)		—
Repayment of notes payable		(1,232,208	)		(19,742	)		(52,327	)
Repayment of related party advances		(61,402	)		—			—
Net cash (used in) provided by investing activities – discontinued operations		(1,290,088	)		(21,427	)		272,905

Schedule of Investment in Real Estate

	September 30, 2017	December 31, 2016
Cost of real estate properties	$       2,606,760	$      11,603,385
Accumulated depreciation	(93,263)	(354,639)
Impairment of real estate properties	(162,369)	(121,500)
Balance at the end of the period	$        2,351,128	$      11,127,246

Schedule of Prepaid Rent

	September 30, 2017	December 31, 2016
Balance, beginning of period	$           13,994	$           39,598
Prepaid rent recognized as revenue during the period	(73,903)	(160,559)
Prepaid rent received during the period	61,689	134,009
Balance, end of period	$             1,780	$           13,048

Note Schedule

	September 30, 2017 $	December 31, 2016 $
Mortgage payable on February 20, 2034, bearing interest at a variable rate, collateralized by a deed of trust on the real estate property purchased with the loan	68,893	194,984
Promissory note payable on November 1, 2019, bearing interest at 5.371% per annum, collateralized by the real estate properties titled to ARP Borrower, LLC and 100% equity ownership in ARP Borrower, LLC. The note is also secured by the Company	–	1,628,276
Promissory note payable on December 1, 2020, bearing interest at 5.88% per annum, collateralized by the real estate properties titled to ARP Borrower II, LLC and 100% equity ownership in ARP Borrower II, LLC	–	956,815
Promissory note payable on May 27, 2017, bearing interest at 16% per annum, collateralized by a deed of trust on the real estate property purchased with the loan	–	180,000
Promissory note payable on July 8, 2017, bearing interest at 18% per annum initially and at 12% per annum after four months, collateralized by a deed of trust on the real estate property purchased with the loan	–	80,000
Promissory note payable on October 1, 2017, bearing interest at 16% per annum, collateralized by a deed of trust on the real estate properties titled to ARP	–	122,298
Promissory note payable on January 1, 2022, bearing interest at 10% per annum, collateralized by a deed of trust on the real estate properties purchased with the loan	350,000	350,000
Mortgage payable on April 1, 2053, bearing interest at 2% per annum, collateralized by a deed of trust on the real estate properties purchased with the loan	240,813	244,767
Promissory note payable on May 1, 2021, bearing interest at 6.07% per annum, collateralized by the real estate properties titled to AHIT Valfre, LLP and ARP Borrower, LLC	–	1,196,022
Mortgage payable on April 1, 2028, bearing interest at 2.985% per annum, collateralized by the real estate property purchased with the loan	–	123,571
	659,706	5,076,733
Note payable – related party, payable on June 1, 2026, bearing interest at 4.5% per annum, collateralized by a deed of trust on the real estate properties purchased with the loan	–	74,307
	659,706	5,151,040
Less: Current Portion of Note payable	(6,870)
	652,836

Schedule of Principal Payments

Year	Amount
2017	$       1,504
2018	7,180
2019	7,379
2020	7,583
2021	7,793
thereafter	628,267
Total	$   659,706

Average Investment by Geographic Location

MSA / Metro Division	Number of Homes	Aggregate Investment	Average Investment per Home
Arizona	2	$        591,041	$         295,521
California	3	1,767,323	589,108
Texas	2	248,396	124,198
Total and Weighted Average	7	$   2,606,760	$         372,394

Future minimum rental revenues under leases

Fiscal Year 2017	$       5,835
Fiscal Year 2018	3,120
Total	$       8,955