REAL ESTATE HELD FOR INVESTMENT (Tables)

12 Months Ended

Dec. 31, 2019

The following table summarizes the Company’s real estate held for investment as of December 31, 2019 and 2018, respectively (in thousands):


	December 31, 2019		December 31, 2018
Land	$	175,317	$	141,950
Buildings and improvements	618,974		426,604
Tenant origination and absorption costs	30,569		22,472
Total real estate, cost	824,860		591,026
Accumulated depreciation and amortization	(65,381)		(38,052)
Total real estate, net	$	759,479	$	552,974

The following table provides summary information regarding the Company’s real estate held for investment as of December 31, 2019 (in thousands):


Property	Date Acquired or Foreclosed on	City	State	Property Type	Land		Building and Improvements		Tenant Origination and Absorption		Total Real Estate, at Cost		Accumulated Depreciation and Amortization		Total Real Estate, Net		Ownership %
Richardson Portfolio:
Palisades Central I	11/23/2011	Richardson	TX	Office	$	1,037	$	12,258	$	—	$	13,295	$	(3,565)	$	9,730	90.0%
Palisades Central II	11/23/2011	Richardson	TX	Office	810		21,006		—		21,816		(5,486)		16,330		90.0%
Greenway I	11/23/2011	Richardson	TX	Office	561		2,147		—		2,708		(901)		1,807		90.0%
Greenway III	11/23/2011	Richardson	TX	Office	702		3,765		—		4,467		(1,321)		3,146		90.0%
Undeveloped Land	11/23/2011	Richardson	TX	Undeveloped Land	3,134		—		—		3,134		—		3,134		90.0%
Total Richardson Portfolio					6,244		39,176		—		45,420		(11,273)		34,147
Park Highlands ⁽¹⁾	12/30/2011	North Las Vegas	NV	Undeveloped Land	34,167		—		—		34,167				34,167		⁽¹⁾
Park Centre	03/28/2013	Austin	TX	Office	3,251		34,452		—		37,703		(6,334)		31,369		100.0%
1180 Raymond	08/20/2013	Newark	NJ	Apartment	8,292		39,128		—		47,420		(7,897)		39,523		100.0%
Park Highlands II⁽¹⁾	12/10/2013	North Las Vegas	NV	Undeveloped Land	27,078		—		—		27,078		—		27,078		⁽¹⁾
Richardson Land II	09/04/2014	Richardson	TX	Undeveloped Land	3,418		—		—		3,418		—		3,418		90.0%
Crown Pointe	02/14/2017	Dunwoody	GA	Office	22,590		68,106		4,830		95,526		(11,753)		83,773		100.0%
The Marq ⁽²⁾	03/01/2018	Minneapolis	MN	Office	10,387		81,065		4,179		95,631		(7,119)		88,512		100.0%
City Tower	03/06/2018	Orange	CA	Office	13,930		135,390		7,937		157,257		(12,823)		144,434		100.0%
Eight & Nine Corporate Centre	06/08/2018	Franklin	TN	Office	17,401		57,595		4,572		79,568		(4,356)		75,212		100.0%
Georgia 400 Center	05/23/2019	Alpharetta	GA	Office	11,431		72,529		7,574		91,534		(3,053)		88,481		100.0%
Single-Family Homes Portfolio
Birmingham Homes	11/04/2019	Birmingham	AL	Home	2,444		11,044		162		13,650		(90)		13,560		100.0%
Houston Homes	11/04/2019	Houston	TX	Home	6,154		22,609		432		29,195		(191)		29,004		100.0%
Jacksonville Homes	11/04/2019	Jacksonville	FL	Home	2,986		24,058		353		27,397		(210)		27,187		100.0%
Memphis Homes	11/04/2019	Memphis	TN	Home	2,679		15,664		266		18,609		(131)		18,478		100.0%
Atlanta Homes	11/04/2019	Atlanta	GA	Home	783		3,839		65		4,687		(38)		4,649		100.0%
Oklahoma Homes	11/04/2019	Oklahoma City	OK	Home	2,082		14,319		199		16,600		(113)		16,487		100.0%
Total Single-Family Homes Portfolio					17,128		91,533		1,477		110,138		(773)		109,365
					$	175,317	$	618,974	$	30,569	$	824,860	$	(65,381)	$	759,479

_____________________

⁽¹⁾ The Company owns 100% of the common members’ equity of Park Highlands and Park Highlands II. On September 7, 2016 and January 8, 2019, a subsidiary of the Company that owns a portion of Park Highlands and Park Highlands II sold 820 units of 10% Class A non-voting preferred membership units for $0.8 million and 1,927 units of 10% Class A2 non-voting preferred membership units for $1.9 million, respectively, to accredited investors. The amount of the Class A and A2 non-voting preferred membership units raised, net of offering costs, is included in other liabilities on the accompanying consolidated balance sheets.

⁽²⁾This property was formerly known as Marquette Plaza and was re-named The Marq in connection with the Company’s re-branding strategy for this property.

Lessor, Operating Lease, Payments to be Received, Maturity

As of December 31, 2019, the future minimum rental income from the Company’s properties, excluding apartment and single-family home leases, under non-cancelable operating leases was as follows (in thousands):


2020	$	53,396
2021	50,295
2022	44,112
2023	35,871
2024	30,396
Thereafter	67,980
	$	282,050

Schedules of Concentration of Risk, by Risk Factor

As of December 31, 2019, the Company’s commercial real estate properties were leased to approximately 229 tenants over a diverse range of industries and geographic areas. The Company’s highest tenant industry concentrations (greater than 10% of annualized base rent) were as follows:


Industry	Number of Tenants	Annualized Base Rent ⁽¹⁾ (in thousands)		Percentage of Annualized Base Rent
Insurance	26	$	7,817	14.1	%
Health Care and Social Services	16	7,021		12.7	%
Computer Systems	24	6,852		12.4	%
		$	21,690	39.2	%

_____________________

(1) Annualized base rent represents annualized contractual base rental income as of December 31, 2019, adjusted to straight-line any contractual tenant concessions (including free rent), rent increases and rent decreases from the lease’s inception through the balance of the lease term.

Schedule of Business Acquisitions, Properties Acquired


The fair values of the assets acquired and liabilities assumed at the closing date were as follows:
Assets:
Land	$	17,126
Building and improvements	91,320
Tenant origination and absorption costs	1,477
Cash and cash equivalents	8,104
Restricted cash	1,667
Rents and other receivables	989
Prepaid expenses and other assets	634
Liabilities:
Notes payable	(61,885)
Accounts payable and accrued liabilities	(1,893)
Other liabilities	(904)
Total cash paid for acquisition	$	56,635

Business Acquisition, Pro Forma Information

The following unaudited pro forma results of operations reflect the Company’s results as if the acquisition of Reven had occurred on January 1, 2019. The information is not necessarily indicative of the results that actually would have occurred, nor does it indicate future operating results. All significant adjustments necessary to reflect the effects have been made.


For the year ended December 31, 2019:
Revenues	$	102,540
Expenses	(116,370)
Net loss	$	(13,830)