Acquisition of Real Estate

12 Months Ended

Dec. 31, 2018

Business Combination Disclosure [Text Block]

Note 5 – Acquisition of Real Estate

The following describes the Company’s significant acquisition activity during the years ended December 31, 2018 and 2017 (dollars in thousands):

Property	Location		Date		Interest			Price		Mortgage
Preston View	Morrisville, NC			February 17, 2017		91.8	% (a)	$	59,500	$	41,066
Wesley Village	Charlotte, NC			March 9, 2017		91.8	% (a)		57,150		40,545
Texas Portfolio (b)		(b)		June 9, 2017		90.0	%		188,850		146,377
Villages at Cypress Creek	Houston, TX			September 8, 2017		80.0	%		40,700		26,200
Citrus Tower	Orlando, FL			September 28, 2017		96.8	%		55,250		41,438
Outlook at Greystone	Birmingham, AL			October 19, 2017		100.0	%		36,250		(c)
ARIUM Metrowest	Orlando, FL			October 30, 2017		100.0	%		86,000		(c)
ARIUM Hunter’s Creek	Orlando, FL			October 30, 2017		100.0	%		96,888		72,294
The Mills	Greenville, SC			November 29, 2017		100.0	%		40,250		26,817
The Links at Plum Creek	Castle Rock, CO			March 26, 2018		88.0	%		61,100		40,000
Sands Parc	Daytona Beach, FL			May 1, 2018		100.0	%		46,200		(c)
Plantation Park	Lake Jackson, TX			June 14, 2018		80.0	%		35,600		26,625
Veranda at Centerfield	Houston, TX			July 26, 2018		93.0	%		40,150		26,100
Ashford Belmar	Lakewood, CO			November 15, 2018		85.0	%		143,444		100,675

(a)

Subsequently increased to 100.0% as discussed below.

(b)

Marquis at Crown Ridge, Marquis at Stone Oak and Marquis at TPC located in San Antonio, Texas, and Marquis at The Cascades I and II (considered one property subsequent to acquisition) located in Tyler, Texas.

(c)

Funded, in part, with the Company’s Senior Credit Facility secured by the property. See Note 8 for further information about the Company’s Secured Credit Facility.

Purchase Price Allocation

The real estate acquisitions above have been accounted for as asset acquisitions. The purchase prices were allocated to the acquired assets based on their estimated fair values at the dates of acquisition.

The following table summarizes the assets acquired at the acquisition date for acquisitions made during the year ended December 31, 2018 (amounts in thousands):

	Purchase Price Allocation
Land	$	31,250
Building		225,857
Building improvements		24,240
Land improvements		38,750
Furniture and fixtures		5,119
In-place leases		5,629
Total assets acquired	$	330,845

In addition to the summary of assets acquired noted above, the Company capitalized $2.7 million in acquisition costs during the year ended December 31, 2018.

Acquisition of Additional Interests in Properties

In addition to the property acquisitions discussed above, the Company also acquired the noncontrolling partner’s interest in the following properties (dollars in thousands):

Property	Date		Amount		Previous Interest			New Interest
ARIUM Grandewood		November 6, 2017	$	3,054		95.0	%		100.0	%
Park & Kingston (a)		December 29, 2017		483		96.0	%		100.0	%
Enders Place at Baldwin Park (a)		December 29, 2017		499		89.5	%		92.0	%
Preston View and Wesley Village (b)		December 29, 2017		3,391		91.8	%		100.0	%
ARIUM at Palmer Ranch		April 26, 2018		4,174		95.0	%		100.0	%
ARIUM Gulfshore		April 26, 2018		4,838		95.0	%		100.0	%
ARIUM Palms		August 29, 2018		3,023		95.0	%		100.0	%

(a)

The additional interests were purchased from Bluerock Special Opportunity + Income Fund III, LLC (“Fund III”) based on a broker’s opinion of value.

(b)

The additional interests were purchased from Bluerock Special Opportunity + Income Fund I, LLC (“Fund I”) based on an 8% return on equity from the original purchase dates in February 2017 and March 2017.