Equity Method Investments

9 Months Ended

Sep. 30, 2012

Equity Method Investments and Joint Ventures [Abstract]

Equity Method Investments Disclosure [Text Block]

Note 5 – Equity Method Investments

The Company accounted for the acquisitions of our unconsolidated interests in properties through managing member LLCs in accordance with the provisions of the Consolidation Topic 810 of the FASB ASC. Following is a summary of the Company’s ownership interest by property as of September 30, 2012, for investments we report under the equity method of accounting.

Property	Joint Venture Interest			Managing Member LLC Interest			Indirect Equity Interest in Property
Augusta		50.00	%		50.00	%		25.00	%
Hillsboro		37.57	%		33.27	%		12.50	%

For Augusta and Hillsboro, the Company’s initial contributions into the managing member LLCs were funded through loans from an affiliate; however, on June 29, 2012 and March 30, 2012, respectively, the loans were repaid and the managing member LLCs were no longer considered VIEs. The Company then analyzed the managing member LLCs under a voting interest model and determined that the investments in the unconsolidated joint ventures should be accounted for under the equity method as each member of the managing member LLC had an equal voting interest.

The carrying amount of the Company’s investments in unconsolidated joint ventures was $2,470,256 and $5,387,147 as of September 30, 2012 and December 31, 2011, respectively. Summary unaudited information for Augusta and Hillsboro as of September 30, 2012 and December 31, 2011 and for the three and nine months ended September 30, 2012 and 2011 are as follows:

	September 30, 2012		December 31, 2011
Balance Sheet:
Real estate, net of depreciation	$	54,001,402	$	54,788,607
Other assets		1,581,766		1,632,794
Total assets	$	55,583,168	$	56,421,401
Mortgage payable	$	41,154,000	$	41,154,000
Other liabilities		863,222		803,085
Total liabilities	$	42,017,222	$	41,957,085
Stockholders’ equity		13,565,946		14,464,316
Total liabilities and stockholders’ equity	$	55,583,168	$	56,421,401

	Three Months Ended September 30,						Nine Months Ended September 30,
	2012			2011			2012			2011
Operating Statement:
Rental revenues	$	1,604,232		$	1,534,541		$	4,749,491		$	4,457,425
Operating expenses		(603,606	)		(562,515	)		(1,673,970	)		(1,570,253	)
Income before debt service, acquisition costs, and depreciation and amortization		1,000,626			972,026			3,075,521			2,887,172
Mortgage interest		(430,158	)		(430,158	)		(1,281,124	)		(1,276,448	)
Depreciation and amortization		(421,053	)		(394,544	)		(1,229,341	)		(1,668,577	)
Net income (loss)		149,415			147,324			565,056			(57,853	)
Net income attributable to JV partners		(130,097	)		(121,645	)		(486,409	)		(38,944	)
		19,318			25,679			78,647			(18,909	)
Amortization of deferred financing costs paid on behalf of joint ventures		(838	)		(838	)		(2,515	)		(2,515	)
Equity in earnings (loss) of unconsolidated joint ventures	$	18,480		$	24,841		$	76,132		$	(21,424	)