0001493152-20-000956.txt : 20200123 0001493152-20-000956.hdr.sgml : 20200123 20200123102659 ACCESSION NUMBER: 0001493152-20-000956 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 54 CONFORMED PERIOD OF REPORT: 20190930 FILED AS OF DATE: 20200123 DATE AS OF CHANGE: 20200123 FILER: COMPANY DATA: COMPANY CONFORMED NAME: Dream Homes & Development Corp. CENTRAL INDEX KEY: 0001518336 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-EDUCATIONAL SERVICES [8200] IRS NUMBER: 202208821 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-55445 FILM NUMBER: 20540742 BUSINESS ADDRESS: STREET 1: 314 S. MAIN STREET CITY: FORKED RIVER STATE: NJ ZIP: 08731 BUSINESS PHONE: 609-693-8881 MAIL ADDRESS: STREET 1: 314 S. MAIN STREET CITY: FORKED RIVER STATE: NJ ZIP: 08731 FORMER COMPANY: FORMER CONFORMED NAME: Virtual Learning Company, Inc. DATE OF NAME CHANGE: 20110415 10-Q 1 form10-q.htm

 

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

 

FORM 10-Q

 

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Quarterly Period Ended September 30, 2019

 

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the transition period from __________ to __________

 

Commission File No. 000-55445

 

DREAM HOMES & DEVELOPMENT CORPORATION

(Exact Name of Registrant As Specified In Its Charter)

 

Nevada   20-2208821
(State Or Other Jurisdiction
Of Incorporation Or Organization)
  (I.R.S. Employer
Identification No.)

 

314 South Main Street Forked River, New Jersey 08731

(Address of Principal Executive Offices and Zip Code)

 

609 693 8881

Registrant’s Telephone Number, Including Area Code:

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class   Trading symbol(s)   Name of each exchange on which registered
Common   DREM   OTC

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [  ] No [X]

 

Indicate by check mark whether the registrant has submitted every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [  ] No [X]

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

 

Large Accelerated Filer [  ] Accelerated Filer [  ] Non-Accelerated Filer [  ] Smaller Reporting Company [X]

Emerging Growth Company [  ]

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. [  ]

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes [  ] No [X]

 

The number of shares outstanding of the registrant’s common stock, as of December 10, 2019, was 25,878,993

 

 

 

   
 

 

DREAM HOMES & DEVELOPMENT CORPORATION

 

TABLE OF CONTENTS

 

PART I. FINANCIAL INFORMATION F-1
ITEM 1. FINANCIAL STATEMENTS F-1
Consolidated Balance Sheet F-2
Consolidated Statements of Operations and Comprehensive Income (Loss) F-3
Consolidated Statements of Cash Flow F-4
Notes to Consolidated Financial Statements F-5
ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 3
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS 7
ITEM 4. CONTROLS AND PROCEDURES 7
   
PART II. OTHER INFORMATION 7
ITEM 1. LEGAL PROCEEDINGS 7
ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS 7
ITEM 3. DEFAULTS UPON SENIOR SECURITIES AND CONVERTIBLE NOTES 8
ITEM 4. MINE SAFETY DISCLOSURES 8
ITEM 5. OTHER INFORMATION 8
ITEM 6. EXHIBITS 8
SIGNATURES 9

 

 2 
 

 

PART 1 - FINANCIAL INFORMATION

 

DREAM HOMES & DEVELOPMENT CORPORATION

 

CONSOLIDATED BALANCE SHEETS

 

   September 30, 2019   December 31, 2018 
   Unaudited     
ASSETS          
CURRENT ASSETS          
Cash  $54,195   $118,687 
Accounts receivable, net of allowance for doubtful accounts ($29,838)   333,826    349,218 
Costs in excess of billings and estimated earnings   47,104    105,847 
Total current assets   435,125    573,752 
           
PROPERTY AND EQUIPMENT, net   34,154    10,731 
           
OTHER ASSETS          
Security deposit   2,200    2,200 
Accounts receivable , net of allowance for doubtful accounts ($43,000)   32,000    32,000 
Deposits and costs coincident to acquisition of land for Development   575,482    360,967 
           
Total assets  $1,078,961   $979,650 
           
LIABILITIES AND STOCKHOLDERS’ EQUITY          
           
CURRENT LIABILITIES          
Accounts payable and accrued expenses  $494,750   $317,634 
Billings in excess of costs and estimated earnings   55,605    254,208 
Accrued income taxes   36,731    21,525 
Loans payable   -    20,000 
Loans payable to related parties   54,352    52,243 
Total current liabilities   641,438    665,610 
           
STOCKHOLDERS’ EQUITY          
Preferred stock; 5,000,000 shares authorized, $.001 par value, as of September 30, 2019 and December 31, 2018, there are no shares outstanding   -    - 
Common stock; 70,000,000 shares authorized, $.001 par value, as of September 30, 2019 and December 31, 2018, there are 25,878,993 and 24,200,953 shares outstanding, respectively; and 16,000 shares committed not yet issued at December 31, 2018 respectively   25,879    24,201 
Additional paid-in capital   1,868,504    1,671,988 
Accumulated deficit   (1,456,860)   (1,382,149)
           
Total stockholders’equity   437,523    314,040 
           
Total liabilities and stockholders’ equity  $1,078,961   $979,650 

 

The accompanying notes are an integral part of these financial statements.

 

F-1
 

 

DREAM HOMES & DEVELOPMENT CORPORATION

 

CONSOLIDATED STATEMENTS OF OPERATIONS

 

   Nine months ended
September 30, 2019
   Nine months ended
September 30, 2018
 
   Unaudited   Unaudited 
Revenue:          
Construction contracts  $2,095,417   $1,927,457 
Total revenue   2,095,417    1,927,457 
           
Cost of construction contracts   1,399,922    1,179,785 
           
Gross profit   695,495    747,672 
           
Operating Expenses:          
Selling, general and administrative, including stock based compensation of $ 110,194 and $ 86,774 , respectively   760,954    700,535 
Depreciation expense   4,576    3,684 
           
Total operating expenses   765,530    704,219 
           
Income (loss) from operations   (70,035)   43,453 
           
Other expenses (income):          
Cancellation of debt   (12,000)   - 
Interest expense   1,470    - 
Total other expenses (income)   (10,530)   - 
           
Net income (loss) before income taxes   (59,505)   43,453 
Provision for income tax (expense)   (15,206)   - 
           
Net income (loss)  $(74,711)  $43,453 
           
Basic and diluted income (loss) per common share  $(.00)  $.00 
           
Weighted average common shares outstanding-basic and diluted   24,915,346    24,200,953 

 

The accompanying notes are an integral part of these financial statement.

 

F-2
 

 

DREAM HOMES & DEVELOPMENT CORPORATION

 

CONSOLIDATED STATEMENTS OF OPERATIONS

 

   Three months ended
September 30, 2019
   Three months ended
September 30, 2018
 
   Unaudited   Unaudited 
Revenue:          
Construction contracts  $551,770   $627,980 
Total revenue   551,770    627,980 
           
Cost of construction contracts   382,944    472,593 
           
Gross profit   168,826    155,387 
           
Operating Expenses:          
Selling, general and administrative, including stock based compensation of $0 and $ 18,798, respectively   201,902    98,344 
Depreciation expense   1,653    1,228 
           
Total operating expenses   203,555    99,572 
           
Income (loss) from operations   (34,729)   55,815 
           
Other expenses (income):          
Interest expense   -    - 
Cancellation of debt   -    - 
Total other expenses (income)        - 
           
Net income before income taxes   (34,729)   55,815 
Provision for income tax benefit (expense)   10,420    - 
           
Net income  $(24,309   $55,815 
           
Basic and diluted income per common share  $.00   $.01 
           
Weighted average common shares outstanding-basic and diluted   25,878,993    24,200,953 

 

The accompanying notes are an integral part of these financial statement.

 

F-3
 

 

DREAM HOMES & DEVELOPMENT CORPORATION

 

CONSOLIDATED STATEMENTS OF CASH FLOWS

 

   Nine months ended
September 30, 2019
   Nine months ended
September 30, 2018
 
         
Net income (loss)  $(74,711)  $43,453 
Adjustments to reconcile net income (loss) to net cash provided (used) in operating activities:          
Depreciation expense   4,576    3,685 
Write-off on deposits and acquisition of land   28,102    - 
Stock-based compensation   110,194    86,774 
Write-off of note payable   (12,000)   - 
Changes in operating assets and liabilities:          
Accounts receivable   15,392    (27,003)
Costs in excess of billings and estimated earnings   58,743    (119,014)
Accounts payable and accrued liabilities   177,116    (74,640)
Accrued income tax   15,206    - 
Billings in excess of costs and estimated earnings   (198,603)   34,973 
Net cash provided in operating activities   124,015    (51,772)
           
INVESTING ACTIVITIES          
Purchase of vehicles   (28,000)   - 
Deposit and costs coincident to acquisition of land for development   (184,120)   (98,411)
Net cash (used) in investing activities   (212,120)   (98,411)
           
FINANCING ACTIVITIES          
Payments on loans to related parties   (17,314)   - 
Proceeds from related parties   40,927    40,000 
Proceeds from loans   -    20,000 
Proceeds from sale of common stock   -    11,400 
           
Net cash provided by financing activities   23,613    71,400 
           
NET INCREASE (DECREASE) IN CASH   (64,492)   (78,783)
           
CASH BALANCE, BEGINNING OF PERIOD   118,687    244,684 
           
CASH BALANCE, END OF PERIOD  $54,195   $165,901 
           
Supplemental Disclosures of Cash Flow Information:          
Interest paid  $1,470   $- 
Income taxes paid  $-   $- 
           
Non-Cash Investing and Financing Activities:          
Issuance of 1,100,000 shares of common stock for debt reduction  $110,000   $- 

 

The accompanying notes are an integral part of these financial statements.

 

F-4
 

 

DREAM HOMES & DEVELOPMENT CORPORATION

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Nine Months Ended September 30, 2019 and 2018 (Unaudited)

 

Note 1 - Significant Accounting Policies

 

Nature of Operations

 

Dream Homes & Development Corporation is a regional builder and developer of new single-family homes and subdivisions, as well as a market leader in coastal construction, elevation and mitigation. In the five years that have passed since Superstorm Sandy flooded 30,000 owner-occupied homes, Dream Homes has helped hundreds of homeowners to rebuild or raise their homes to comply with new FEMA requirements.

 

In addition to the coastal construction market, Dream Homes will continue to pursue opportunities in new single and multi-family home construction, with 4 new developments totaling 123 units under contract and in development. Dream Homes’ operations will include the development and sale of a variety of residential communities, including construction of semi-custom homes, entry-level and first time move-up single-family and multi-family homes.

 

In addition to the New Jersey market, the Company, through its Dream Building LLC subsidiary, has become licensed in Florida to pursue recent opportunities for elevation, restoration, renovation and new construction brought about by the damage caused by recent hurricanes. Initial markets to be targeted are located primarily in the southwest portion of the state, between Naples and Cape Coral.

 

In addition to the Company’s construction operations, the Company holds a bi-monthly “Dream Homes Nearly Famous Rebuilding Seminar”, and publishes an informational blog known as the “Dream Homes Rebuilding Blog”. The Rebuilding Seminar is an educational tool for homeowners who need rebuilding or renovations. This seminar has been presented steadily since early 2013, and is designed to educate and assist homeowners in deciphering the confusion about planning and executing complex residential construction projects. A professional team attends each seminar and presents on a diverse variety of topics, including expert advice from architects, engineers, finance people, attorneys, project managers, elevation professionals and builder/general contractors. The “Dream Homes Rebuilding Blog” is an educational platform written by Vincent Simonelli, which offers comprehensive advice on all aspects of construction, finance, development and real estate. The Blog is located at http://blog.dreamhomesltd.com.

 

History

 

Dream Homes & Development Corporation was originally incorporated as The Virtual Learning Company, Inc. (“Virtual Learning”) on January 6, 2009 as a Nevada corporation with 75,000,000 shares of capital stock authorized, of which 70,000,000 shares are common shares ($.001 par value), and 5,000,000 shares are preferred shares ($.001 par value).

 

On August 19, 2016, Virtual Learning acquired 4.5% of Dream Homes, Ltd. (“DHL”), 100% of Dream Building, LLC (“DBL”) , a wholly owned subsidiary of DHL, and use of all construction licensing and registrations held by Atlantic Northeast Construction LLC (“ANCL”), a wholly owned subsidiary of DHL, in exchange for the issuance of 2,225,000 shares of Virtual Learning common stock to DHL at an agreed price of $.05 per common share.

 

The majority stockholder and chief executive officer of DHL was also the controlling stockholder and chief executive officer of Virtual Learning. As Virtual Learning and DHL were entities under common control, the acquired assets were reflected by Virtual Learning at DHL’s $0 carrying amount on the date of transfer pursuant to Accounting Standards Codification (“ASC”) 805-50-30-5.

 

F-5
 

 

From August 19, 2016 to August 23, 2016, Virtual Learning acquired the rights to complete 6 in process construction contracts of ANCL in exchange for the issuance of 2,287,367 shares of Virtual Learning common stock to DHL at an agreed price of $.05 per common share for those ANCL contracts. As Virtual Learning and DHL were entities under common control, the acquired rights were reflected at DHL’s $0 carrying amount on the date of transfer pursuant to ASC 805-50-30-5.

 

Due to the Company’s change in focus to its construction business, the Company wrote off the remaining unamortized capitalized curriculum development costs of $20,534 at December 31, 2016.

 

On March 14, 2017, Virtual Learning changed its name to Dream Homes & Development Corporation (“DHDC”). DHDC maintains a web site at www.dreamhomesltd.com as well as a blog, located at http://blog.dreamhomesltd.com.

 

Interim Financial Statements

 

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they may not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations or cash flows. It is management’s opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation.

 

The unaudited interim financial statements should be read in conjunction with the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2018, which contains the financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Conditions and Results of Operations, for the year ended December 31, 2018. Operating results for the nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019.

 

Principles of Consolidation

 

The consolidated financial statements include the accounts of DHDC and its wholly owned subsidiary DBL (collectively, the “Company”). All intercompany balances and transactions have been eliminated in consolidation.

 

Property and Equipment

 

Property and equipment is stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over an estimated useful life of five years. Repairs and maintenance costs are expensed as incurred, and renewals and betterments are capitalized.

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates.

 

Fair Value of Financial Instruments

 

Fair value is defined as the price that we would receive to sell an asset or pay to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date. In determining fair value, GAAP establishes a three-level hierarchy used in measuring fair value, as follows:

 

● Level 1 inputs are quoted prices available for identical assets and liabilities in active markets.

 

F-6
 

 

● Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets and liabilities in active markets or other inputs that are observable or can be corroborated by observable market data.

 

● Level 3 inputs are less observable and reflect our own assumptions.

 

Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and loans payable to related parties. The carrying amount of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, and loans payable to related parties approximates fair value because of their short maturities.

 

Construction Contracts

 

Revenue recognition:

 

The Company recognizes construction contract revenue using the percentage-of-completion method, based primarily on contract cost incurred to date compared to total estimated contract cost. Cost of revenue includes an allocation of depreciation, amortization and general overhead cost. Changes to total estimated contract cost or losses, if any, are recognized in the period in which they are determined.

 

The Company generally provides limited warranties for work performed under its construction contracts with periods typically extending for a limited duration following substantial completion of the Company’s work on a project.

 

The Company classifies construction-related receivables and payables that may be settled in periods exceeding one year from the balance sheet date, if any, as current assets and liabilities consistent with the length of time of its project operating cycle. For example:

 

  Costs and estimated earnings in excess of billings represent the excess of contract costs and profits (or contract revenue) over the amount of contract billings to date and are classified as a current asset.
     
  Billings in excess of costs and estimated earnings represent the excess of contract billings to date over the amount of contract costs and profits (or contract revenue) recognized to date and are classified as a current liability.

 

Costs and estimated earnings in excess of billings result when either: 1) costs are incurred related to certain claims and unapproved change orders, or 2) the appropriate contract revenue amount has been recognized in accordance with the percentage-of-completion accounting method, but a portion of the revenue recorded cannot be billed currently due to the billing terms defined in the contract. Claims occur when there is a dispute regarding both a change in the scope of work and the price associated with that change. Unapproved change orders occur when there is a dispute regarding only the price associated with a change in scope of work. For both claims and unapproved change orders, the Company recognizes revenue, but not profit, when it is determined that recovery of incurred cost is probable and the amounts can be reliably estimated.

 

F-7
 

 

Change in Estimates:

 

The Company’s estimates of contract revenue and cost are highly detailed and many factors change during a contract performance period that result in a change to contract profitability. These factors include, but are not limited to, differing site conditions: availability of skilled contract labor: performance of major material suppliers and subcontractors: on-going subcontractor negotiations and buyout provisions: unusual weather conditions: changes in the timing of scheduled work: change orders: accuracy of the original bid estimate: changes in estimated labor productivity and costs based on experience to date: achievement of incentive-based income targets: and the expected, or actual, resolution terms for claims. The factors that cause changes in estimates vary depending on the maturation of the project within its lifecycle. For example, in the ramp-up phase, these factors typically consist of revisions in anticipated project costs and during the peak and close-out phases, these factors include the impact of change orders and claims as well as additional revisions in remaining anticipated project costs. Generally, if the contract is at an early stage of completion, the current period impact is smaller than if the same change in estimate is made to the contract at a later stage of completion. Management focuses on evaluating the performance of contracts individually and uses the cumulative catch-up method to account for revisions in estimates. Material changes in estimates are disclosed in the notes to the consolidated financial statements.

 

Income Taxes

 

The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the provision for income tax in the statements of operations. The Company evaluates the probability of realizing the future benefits of its deferred tax assets and provides a valuation allowance when realization of the assets is not reasonably assured.

 

The Company recognizes in its financial statements the impact of tax positions that meet a “more likely than not” threshold, based on the technical merits of the position. The tax benefits recognized from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement.

 

Net Income (Loss) Per Common Share

 

Basic net income (basic net loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period.

 

Diluted net income (loss) per common share is computed using the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period.

 

Recent Accounting Pronouncements

 

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Accounting Standards Codification “ASC” Topic 606). The purpose of this ASU is to converge revenue recognition requirements per GAAP and International Financial Reporting Standards (“IFRS”). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments in this ASU were originally effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption not permitted by the FASB; however, in August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date after public comment respondents supported a proposal to delay the effective date of this ASU to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. We adopted this ASU on January 1, 2018 and adoption of this ASU did not have a material impact on our financial position, results of operations and cash flows.

 

F-8
 

 

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” and subsequent amendments to the initial guidance: ASU 2017-13, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01 (collectively, “Topic 842”), which provides guidance for accounting for leases. Topic 842 requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on an effective interest rate method or on a straight-line basis over the term of the lease. We are currently evaluating both the method and the impact of adopting this guidance on our Condensed Consolidated Financial Statements.

 

Certain other accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. The impact on the Company’s financial position and results of operations from adoption of these standards is not expected to be material.

 

2 - Property and Equipment

 

Property and equipment is summarized as follows:

 

   September 30, 2019   December 31, 2018 
         
Office equipment  $4,115   $4,115 
Vehicles/Modular office   59,065    31,065 
Less: Accumulated depreciation   (29,026)   (24,449)
           
Property and Equipment- net  $34,154   $10,731 

 

Depreciation expense for the nine months ended September 30, 2019 and 2018 was $4,576 and $3,684, respectively.

 

3- Deposits and Costs Coincident to Acquisition of Land for Development

 

Deposits and costs coincident to acquisition of land for development are summarized as follows:

 

  

September 30, 2019

  

December 31, 2018

 
         
Lacey Township, New Jersey, Marina contract:          
Deposit   25,000    25,000 
Site engineering, permits and other costs:   49,959    49,959 
Total Marina Contract   74,959    74,959 
           
Other Deposits:          
Clayton - 120 apartments   54,467    9,920 
71 Sheridan Avenue   79,150    79,150 
Bayville-17 units   30,949    2,674 
Other   7,726    2,005 
           
Lacey Township, New Jersey, Pines contract:          
           
Deposit   -    - 
Cost to acquire contract   10,000    10,000 
Site engineering, permits, and other costs   109,265    109,265 
Total Pines contract   119,265    119,265 
           
Berkeley Township, New Jersey, Tallwoods contract:          
Deposit   10,000    10,000 
Site engineering, permits, and other costs   86,442    62,994 
Total Tallwoods contract   96,442    72,994 
           
Louis Ave – Bayville 17 units   30,949    - 
Station Dr – Forked River   54,109    - 
201 East Ave – Clayton – 77 units   52,200    - 
Academy St – Clayton – 2 lots   3,199    - 
Fairview Development – Clayton 120 units   6,874    - 
Lackland (Pines contract)   (6,5532)   - 
           
Total  $575,482   $360,967 

 

F-9
 

 

Lacey Township, New Jersey, “Dream Homes at the Pines”, Contract

 

On December 15, 2016, the Company acquired from General Development Corp. (“GDC”) rights to a contract to purchase over 9 acres of undeveloped land without amenities in Lacey Township, New Jersey (the “Lacey Contract or Dream Homes at the Pines”) for $15,000 cash (paid in December 2016) and 100,000 restricted shares of Company common stock (issued in April 2017) valued at $5,000. GDC acquired the rights to the contract from DHL on December 14, 2016 for $10,000 cash. As discussed in Note 9, Commitments and Contingencies under Line of Credit, the Company also has an available line of credit of $50,000 with GDC.

  

The Lacey Contract between DHL and the seller of the land was dated March 18, 2016 and provides for a $1,000,000 purchase price with closing on or about 60 days after memorialization of final Development Approvals has been obtained. DHL paid the seller a $10,000 refundable deposit in March 2016 pursuant to the Lacey Contract. In the event the transaction has not closed on at least a portion of the property within 24 months of the completion of the Due Diligence Period (as may be extended by two 6- month extensions), the seller has the option of terminating the contract. Notwithstanding this provision, the Company retains the right at all times to waive any remaining contingencies and proceed to close on the property.

 

Due diligence for the above property was completed as of May 17, 2016, and all costs were incurred by Dream Homes Ltd., which was in the contract for the property at the time. No additional costs for due diligence have been incurred by the Company, nor are any anticipated. The Company will incur all current costs associated with this property necessary to obtain all approvals, acquire the land, install the infrastructure and prepare the property to commence construction.

 

In order to obtain all developmental approvals and be prepared to begin installing infrastructure, various permits and engineering work are required. These permits include but are not limited to township subdivision, county, municipal utility authority, CAFRA (NJ Department of Environmental Protection) and NJ Department of Transportation. To date, design engineering has been completed and a CAFRA application has been prepared and submitted to the environmental scientist, along with a check for $36,750 payable to the NJ DEP. Application for this permit was made in April 2017. As of this date, the CAFRA application has been put on hold pending a determination if the township will be approved by the State of New Jersey for a CAFRA Town Center designation. A permit is expected to be issued in June or July of 2018. A Lacey Township Planning Board meeting was held on December 11, 2017. Additional information was requested from the board and the next meeting will be scheduled upon receipt of outside agency permits and the other requested information.

 

F-10
 

 

It is anticipated that complete development approvals will cost approximately $50,000 more to complete. In addition to these approval costs and acquisition costs, infrastructure costs are anticipated to cost approximately $1,000,000. The total amount of funding required to acquire and make this property ready for home construction is approximately $2,090,000 as of June 30, 2019.

 

The Company may need to seek loans from banks to finance this project. As part of their financing agreements, the banks typically require Vincent Simonelli to personally guarantee these loans. If Mr. Simonelli cannot qualify as a guarantor and there is no one other than him in the Corporation to provide those guarantees, the financing of the deal may be adversely affected. The exact amount of funding required for this particular property is not clear at the present time but will be determined when full approvals have been obtained and the Company is prepared to take title to the property.

 

Lacey Township, New Jersey, “Dream Homes at Forked River”, Marina Contract

 

The Company has acquired the rights to a purchase contract via contract assignment for 48 waterfront townhomes with boat slips in Lacey, NJ. The project is currently in the approval process and significant engineering, environmental, traffic and architectural work has been completed. The property is a waterfront property, and is partially improved with all boat slips currently installed, the Department of Transportation permit received and the curb cut from Route 9 in place. The property when completely constructed has a retail value of $21 million and is expected to begin site improvements in late 2018 or early 2019.

 

On December 8, 2017, the Company acquired from DHL rights to a contract to purchase over +/- 7.5 acres of land in Lacey Township, NJ (the “Marina Contract or Dream Homes at Forked River”) for 162,200 restricted shares of Company common stock (committed but not issued as of April 16, 2018). The Contract between DHL and the seller of the land was dated February 24, 2016 and provides for a $2,166,710 purchase price with closing on or about 60 days after final development approvals have been obtained and memorialized. DHL paid the seller a refundable $25,000 deposit in February 2016 pursuant to the Marina contract.

 

The due diligence period associated with this property expired on May 1, 2016 and all costs associated with same were paid by Dream Homes Ltd. prior to the expiration date. The Company will incur no further costs related to the due diligence aspect of this purchase. The Company will incur all current and future costs associated with this property necessary to obtain all approvals, acquire the land and prepare the property to commence construction.

 

The land is currently approved for a marina and it is the Company’s intention to modify the approvals to a townhome use, as per the ordinance. The property is currently unimproved. As such, the necessary steps required to bring the property through the approval process involve design engineering as well as environmental approvals. Accordingly, the remaining costs will primarily involve engineering, legal and approval costs.

 

At this time, the Company estimates that the total engineering and approval costs will be approximately $100,000. The amount of money required to purchase the property is $2,430,000 of which $25,000 is currently on deposit.

 

The Company may need to seek loans from banks to finance this project. As part of their financing agreements, the banks typically require Vincent Simonelli to personally guarantee these loans. If Mr. Simonelli cannot qualify as a guarantor and there is no one other than him in the Corporation to provide those guarantees, the financing of the deal may be adversely affected. The exact amount of funding required for this particular property is not clear at the present time but will be determined when full approvals have been obtained and the Company is prepared to take title to the property. This development is currently on hold pending a change in environmental regulations from the New Jersey Department of Environmental Protection concerning the CAFRA Town Center designation.

 

F-11
 

 

Little Egg Harbor Township, New Jersey, “Dream Homes at Radio Road”, Contract

 

On March 14, 2018, the Company signed a contract to purchase 4 improved lots in Little Egg Harbor Township, NJ (the “Dream Homes at Radio Road”) for a total of $260,000. The Contract between the Company and the seller of the land provides for a $65,000 per lot purchase price with closing occurring on a rolling basis, as each house is built and sold. In addition, the Company has obtained a term sheet on April 5, 2018 and is waiting for a formal commitment from 1st Constitution Bank for a funding facility comprised of acquisition and development funding.

 

The Company intends to begin construction in the second quarter and the homes are projected to sell in the $350,000 - $375,000 range.

 

Glassboro Township, New Jersey – Robin’s Nest Solar Farm

 

On May 28, 2018, the Company signed a contract to purchase a 700 KW property to be developed as a solar farm in Glassboro, NJ. The purchase price is $900,000 and the contract is subject to obtaining funding for the solar array as well as a portion of the purchase price. There is also a PPA (power production agreement) in place with a nursing home adjacent to the property, to purchase the entire electrical output for the next 20 years.

 

This acquisition has been put on hold pending availability of funding.

 

71 Sheridan Street, Waretown, NJ – Property purchased for renovation and sale

 

On July 12, 2018, the Company purchased a single-family home property located at 71 Sheridan Street in Waretown, NJ. The home was originally damaged by Storm Sandy, and requires elevation and renovation in order to be brought into compliance with the latest FEMA flood zone requirements. The Company intends to complete a full height elevation, enclose the lower level, install 2 levels of deck facing the water, renovate the house completely and sell the property.

 

Louis Avenue – Bayville, NJ – Property being developed

 

In October of 2018, the company entered into a contract to develop and acquire 17 townhouse lots in Bayville NJ. Engineering and approvals are currently in process.

 

4-Loans Payable to Related Parties

 

Loans payable to related parties is summarized as follows:

 

   Sepember 30, 2019   December 31, 2018 
         
Loans payable to chief executive officer  $70,634   $29,025 
Loans payable to GPIL   3,118    3,118 
Loan payable to DHL   (19,400)   20,100 
Net total  $54,352   $52,243 

 

All the loans above are non-interest bearing and due on demand.

 

5 - Common Stock Issuances

 

On February 22, 2017, DHDC issued 56,000 restricted shares of common stock to Green Chip Investor Relations pursuant to an Investor Relations and Consulting Services Agreement (see Note 8). The 56,000 restricted shares were valued at $2,800 (or $.05 per share), which amount was expensed in the three months ended March 31, 2017.

 

F-12
 

 

On March 1, 2017, DHDC committed to issue 71,429 restricted shares of common stock (issued April 24, 2017) to DHL valued at $10,000, representing the amount of the refundable deposit on land made by DHL to the Seller in January 2017 for the Berkeley Township New Jersey contract (see Note 3).

 

On March 14, 2017, DHL assigned 275,000 restricted shares of Company common stock it held to the same minority stockholder of DHL that it assigned 100,000 shares of Company common stock on October 13, 2016 (see sixth preceding paragraph).

 

On April 26, 2017, DHDC issued 100,000 shares of restricted stock to General Development Corp. as payment of an assignment fee related to the 58-unit townhouse development in Lacey Township, NJ (see Note 3).

 

On July 12, 2017, DHDC issued 40,000 restricted shares of DHDC’s common stock to Dream Homes, Ltd. (“DHL”) in exchange for vehicles owned by DHL. The transaction reflected $6,000 net carrying value of the assets on DHL’s books at July 12, 2017.

 

On September 21, 2017, DHL assigned 25,000 restricted shares of Company common stock it held to the Secretary of both DHDC and DHL for services rendered to DHL. Accordingly, no stock-based compensation was recognized by DHDC.

  

On December 8, 2017, DHDC committed to issue 162,200 restricted shares of common stock to DHL valued at $48,658 (DHL’s historical cost of the assets being assigned), for the assignment of a contract to purchase property from DHL for the Lacey Township New Jersey contract (see Note 3).

 

On December 11, 2017, DHL assigned 100,000 restricted shares of Company common stock it held to the Company Securities Counsel of both DHDC and DHL in settlement of certain DHL accounts payable due him. Accordingly, no stock-based compensation was recognized by DHDC.

 

On December 27, 2017, DHDC committed to issue 12,500 restricted shares of DHDC’s common stock for cash proceeds of $ 5,000 at $.40 per share per the Subscription Agreement.

 

On December 29, 2017, DHDC committed to issue 27,810 restricted shares of DHDC’s common stock for settlement of $ 11,124 accounts payable at $.40 per share.

 

On January 31, 2018, DHDC committed to issue 16,000 restricted shares of DHDC’s common stock for cash proceeds of $11,400 at $ .40 per share per the subscription agreement.

 

On February 9, 2018, DHL assigned 40,000 restricted shares of Company common stock it held to a minority stockholder of DHL. This minority stockholder of DHL had contributed $10,000 out of approximately $500,000 in a private placement of common stock of DHL in 2010. In addition, this minority stockholder of DHL also received 30,000 restricted shares of DHL common stock in 2011 for legal services. Accordingly, no stock-based compensation was recognized by DHDC for this assignment of 40,000 shares.

 

On February 9, 2018, DHL assigned 25,000 restricted shares of Company common stock it held to the Secretary of both DHDC and DHL for accounting and administrative services rendered to DHL. Accordingly, no stock-based compensation was recognized by DHDC for this assignment of 25,000 shares.

 

On February 9, 2018, DHL assigned 25,000 restricted shares of Company common stock it held to a director of DHDC and service provider to DHL for legal services provided to DHL. Accordingly, no stock-based compensation was recognized by DHDC for this assignment of 25,000 shares.

 

On February 26, 2018 DHDC issued 12,500 restricted shares of DHDC’s common stock for cash proceeds of $ 5,000 at $.40 per share per the Subscription Agreement.

 

On May 9, 2019, the Company issued 58,000 restricted shares of restricted common shares to two individuals for consulting services at $.08 per share.

 

F-13
 

 

On June 6, 2019, the Company issued 520,000 restricted shares for stock-based compensation at $.10 per share to six individuals.

 

On June 6, 2019, the Company issued 1,000,000 restricted shares for debt reduction to the Chief Executive Officer at $.10 per share.

 

On June 6, 2019, the Company issued 100,000 restricted shares for reduction of note payable at $.10 per share.

 

6 – Income Taxes

 

The provisions for (benefit from) income taxes differ from the amounts computed by applying the statutory United States Federal income tax rate (21% in 2019 and 2018) to income (loss) before income taxes.

 

The sources of the differences follow:

 

  

Nine months

ended

September 30, 2019

  

Nine months

ended

September 30, 2018

 
Expected tax (benefit)  $(12,496)  $(9,852)
State income taxes, net of Federal (benefit)   (5,298)   (2,816)
Non-deductible stock-based compensation   33,000    14,275 
Change in valuation allowance   -    (1,607)
Provision for income taxes  $15,206   $- 

 

The significant components of DHDC’s deferred tax asset as of September 30, 2019 and December 31, 2018 are as follows:

 

    September 30, 2019    December 31,2018 
           
Deferred tax assets:          
Net operating loss carry forward  $-   $

57,598

 
Valuation allowance   -    (57,598)
Net deferred tax asset  $-   $- 

 

7- Business Segments

 

The company currently has one business segment which is residential construction, which is further divided into elevation/renovation, demolition and new home construction and new single and multi-family home developments. The residential construction segment is operated through DHDC’s wholly owned subsidiary Dream Building, LLC (since August 19, 2016).

 

8- Commitments and Contingencies

 

Construction Contracts

 

As of September 30, 2019, Dream Building, LLC is committed under 26 construction contracts outstanding with homeowners with contract prices totaling $ 6,870,825, which are being fulfilled in the ordinary course of business. None of these construction projects are expected to take significantly in excess of one year to complete from commencement of construction. The Company has no significant commitments with material suppliers or subcontractors that involve any sums of substance or, of long-term duration at the date of issuance of these financial statements.

 

F-14
 

 

Employment Agreements

 

On April 28, 2017, DHDC executed an Employment Agreement with a Vice President of Business Development. The term of the agreement was scheduled to run from April 28, 2017 to December 31, 2020, unless otherwise cancelled, and was renewable thereafter at 1-year intervals based on certain sales targets. The agreement provided for compensation based on sales. This person stopped working for the Company at the end of 2018 and the agreement was cancelled accordingly.

 

On May 8, 2017, DHDC executed an Employment Agreement with a newly appointed Sales Manager. The term of the agreement is from May 8, 2017 to May 8, 2019 and was renewable thereafter at 1-year intervals based on certain sales targets. That agreement has been renewed and is currently in force. The agreement provides for compensation based on sales.

 

Lease Agreement

 

On June 20, 2017, DHDC executed a lease for office and storage space located at 2109 Bridge Avenue, Point Pleasant, New Jersey. The term of the Lease is five years from June 20, 2017 to June 20, 2022 with two (2) five (5) year options to renew. The Lease provides for monthly rent commencing August 20, 2017 at $1,200 per month until the earlier of completion of upstairs offices or November 20, 2017, at which time the monthly rent increases to $2,200 per month. Assuming DHDC is current in all rent and other charges, DHDC has the option to cancel the Lease with 90 days written notice to Landlord.

 

For the nine months ended September 30, 2019, rent expense under this lease agreement was $12,600. Monthly lease payments were changed to $1,000 per month as of 3/31/19.

 

This lease has ended as of 12/31/19 and the Company has vacated the premises. The Company is seeking other showroom office space in northern Ocean and southern Monmouth Counties.

 

Investor Relations Agreement

 

On February 10, 2017, the Company entered into an Investor Relations and Consulting Services Agreement with an investor relations firm. The agreement expired on August 31, 2017 and provided for issuance of 56,000 restricted shares of common stock valued at $2,800 to the investor relations firm (stock issued on February 22, 2017) and $2,000 per month fees to be paid to the investor relations firm commencing March 2017.

 

For the nine months ended September 30, 2019 and 2018, consulting fees expense under this agreement was $0 and $2,000, respectively. This Agreement is no longer in effect on any type of constant basis, and the services of the Consultant are being utilized on an as-needed basis.

 

Line of Credit

 

On September 15, 2016, DHDC established a $50,000 line of credit with General Development Corp., a non-bank lender. Advances under the line bear interest at a rate of 12%, with interest being payable on demand. The outstanding principal is due and payable in 60 months. The line is secured by the personal guarantee of the Company’s Chief Executive Officer. The agreement to fund automatically renews on a yearly basis as long as interest payments are current. To date, the Company has received several advances under the line of credit. As of 12/31/19, the outstanding principal balance was $162,000. Interest expense was brought current as of 1/3/20.

 

Private Placement

 

On November 3, 2017, the Company released a Private Placement Memorandum, which consists of an equity and debt offering for up to $5,000,000 in new capital. This capital will be utilized for acquisition and development of several of the properties the Company has under contract, as well as expansion into the Florida market. The offering is comprised of Units for sale as well as convertible debt. Each Unit is priced at $.40 per common share and includes 1 warrant to purchase an additional share of common stock for $.60 within 3 years of the date of Unit purchase. The convertible debt is offered at an 8% coupon, paid quarterly, has a maturity of 4 years and is convertible at $.75 per share. The offering was scheduled to close on January 2, 2018 and was extended unchanged by the Company to September 2, 2018.

 

F-15
 

 

As of May 21,, 2018, the Company has sold a total of 68,810 units and received $16,400 in cash ($5,000 in December 2017 for 12,500 units, $6,400 in January 2018 for 16,000 units and $5000 in February 2018 for 12,500 units) and was granted a reduction in accounts payable from a lumber vendor of 11,124 for 27,810 units issuable to the vendor as of December 31, 2017.

 

9- Related Party Transactions

 

Dream Homes Ltd. Allocated payroll

 

The Company uses the services of Dream Homes Ltd. (DHL) personnel for its operations. For the nine months ended September 30, 2019 and 2018, selling, general and administrative expenses include $277,949.00 and $280,122.46, respectively. Costs incurred for the Company’s estimated share of DHL’s gross payroll and payroll taxes for the 2019 nine-month period include $57,000 salary paid to the Company’s Chief Executive Officer and $40,800 salary paid to the Company’s Secretary and VP of Human Resources.

 

Office Space

 

The Company has occupied office space located in Forked River, New Jersey which is owned by an affiliated company. Commencing April 2017, the Company has paid DHL monthly rent of $2,000 ($18,000 total for the nine months ended September 30, 2019) for this office space.

 

10- Stock Warrants

 

On July 12, 2017, DHDC issued 750,000 stock warrants to various members of Dream Homes & Development Corporation’s executive team (including 500,000 to the Company’s Chief Executive Officer, 100,000 to the Company’s Secretary, and a total of 60,000 to the Company’s two other directors and 50,000 to a non-executive DHL project manager employee). These Warrants entitle the holder to purchase shares of Dream Homes & Development Corporation at $0.30 per share through July 20, 2020. These warrants vest to the Holder on a semi-annual basis over a 36-month period contingent upon Holder’s continued association with the Company. The $407,850 total fair value (calculated using the Black Scholes option pricing model and the following assumptions: (1) stock price of $0.60, (2) exercise price of $0.30, (3) dividend yield of 0%, (4) risk-free interest rate of 1.53%, (5) expected volatility of 171%, and (6) term of 3 years) of the 750,000 warrants is being expensed evenly over the 3 years requisite service period of the individuals that were granted these warrants commencing in July 2017. For the three months ended March 31, 2019 and 2018, stock-based compensation attributable to the warrants was $30,394 and $33,988, respectively, using the above Black Scholes option pricing model. For the year ended December 31, 2018, stock-based compensation attributable to the warrants was $ 117,844 using the above Black Scholes option pricing model.

 

Included within the 750,000 warrants described in the preceding paragraph are 20,000 warrants issued to the Company’s Vice President of Business Development that are not covered by the Employment Agreement dated April 28, 2017 described in Note 8. These warrants have been cancelled since this individual is no longer with the Company as of 12/31/18. Also included within the 750,000 warrants described in the preceding paragraph are 20,000 warrants issued to the Company’s Sales Manager that are not covered by the Employment Agreement dated May 8, 2017 described in Note 8.

 

Effective April 1, 2020, all remaining warrants were cancelled.

 

F-16
 

 

11- Receivable from Arbitration and settlement of in process customer construction contract in dispute and related losses recognized and recorded by the Company

 

The Company began work on a construction contract in the amount of $307,000 in August 2016. Through September 30, 2017, the Company billed the customer a total of $219,565, collected a total of $130,247 from the customer, and accordingly had a balance due from the customer of $89,318 at September 30, 2017. When the customer refused to pay the $89,318 balance, the Company ceased working on the contract in July 2017, filed a request for arbitration on October 3, 2017, and filed a Construction Lien Claim on October 18, 2017. On March 6, 2018, the American Arbitration Association awarded the Company $75,000 in connection with its claim. To date the Company has not yet collected the $75,000 owing to it under the arbitration award. Based upon advice of Company Counsel it still has further legal actions available to it to ultimately facilitate payment from the customer of the $75,000 in the contract dispute. Accordingly, at December 31, 2017 the Company has recognized a loss of $14,318 on the write-down of accounts receivable from this customer which has been reflected as a reduction in revenue from construction contracts and gross profit for the year ended December 31, 2017.

 

At December 31, 2017, there was a “Costs and estimated earnings in excess of billings” asset relating to the Arbitration Award disputed contract of $48,419 representing the difference between the amount billed to the customer of $219,565 and costs and estimated earnings of $267,984 through December 31, 2017. Accordingly, at December 31, 2017 the Company has also recognized a loss of $48,419 on the write-down of the “Costs and estimated earnings in excess of billings” asset attributable to this disputed customer contract, which has been reflected as a reduction in revenue from construction contracts and gross profit for the year ended December 31, 2017. Over the life of this contract the Company recognized a cumulative gross profit of $17,658 through December 31, 2017, which is net of a negative gross profit of ($9,012) for the year ended December 31, 2017, based upon the write-down of $14,318 described in the preceding paragraph and the $48,419 write-down described in this paragraph, which aggregate to $62,732.

 

12- Subsequent Events

 

A contract was signed to acquire 70 approved townhome units in October 2019, after 31 months of discussion. A contract was signed to purchase 52 approved townhome units in Forked River, NJ.

 

F-17
 

 

ITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

 

This Quarterly Report on Form 10-Q/A and other written reports and oral statements made from time to time by the Company may contain so-called “forward-looking statements,” all of which are subject to risks and uncertainties. One can identify these forward-looking statements by their use of words such as “expect,” “plan,” “will,” “may,” “anticipate,” “believe,” “estimate,” “should,” “intend,” “forecast,” “project” the negative or plural of these words, and other comparable terminology. One can identify them by the fact that they do not relate strictly to historical or current facts. These statements are likely to address the Company’s growth strategy, financial results and product and development programs. One must carefully consider any such statement and should understand that many factors could cause actual results to differ from the Company’s forward-looking statements. These factors include inaccurate assumptions and a broad variety of other risks and uncertainties, including some that are known and some that are not. No forward-looking statement can be guaranteed and actual future results may vary materially. The Company does not assume the obligation to update any forward-looking statement. One should carefully evaluate such statements in light of factors described in the Company’s filings with the SEC, especially the Company’s Annual Report on Form 10-K and the Company’s Quarterly Reports on Form 10-Q. In various filings the Company has identified important factors that could cause actual results to differ from expected or historic results. One should understand that it is not possible to predict or identify all such factors. Consequently, the reader should not consider any such list to be a complete list of all potential risks or uncertainties.

 

Use of Terms

 

The following discussion analyzes our financial condition and results of operations for the nine months ended September 30, 2019 and 2018. Unless the context indicates or suggests otherwise, reference to “we”, “our”, “us” and the “Company” in this section refers to the operations of Dream Homes & Development Corporation (DHDC),

 

PLAN OF OPERATION

 

Overview

 

Building on a history of over 1,500 new homes built, the management of Dream Homes & Development Corporation has positioned the company to emerge as a rapidly growing regional developer of new single-family homes & subdivisions as well as a leader in coastal construction, elevation and mitigation. In the seven years that have passed since Superstorm Sandy flooded over 30,000 owner-occupied homes, Dream Homes has helped hundreds of homeowners to rebuild or raise their homes to comply with new FEMA requirements. While other builders have struggled to adapt to the changing market and complex Federal, State and local regulations involved with coastal construction in Flood Hazard Areas, Dream Homes has excelled. As many of our competitors have failed, Dream Homes has developed a reputation as the region’s most trusted builder and has even become known as the “rescue” builder for homeowners whose projects have been abandoned by others. Due to the damage caused by the storm, as well as the material changes in the FEMA flood maps which now require over 30,000 homeowners along the New Jersey coastline to elevate their homes, Dream Homes is positioned to capitalize on this opportunity for substantial revenue growth.

 

Management recognized that the effects of Super Storm Sandy, which occurred on 10/29/12, would be far reaching and cause an almost unlimited demand for construction services, as well as specific construction information. Due to the damage caused by the storm, as well as the material changes in the FEMA flood maps which now require over 30,000 homeowners along the New Jersey coastline to elevate their homes, management feels that focusing on the construction field will continue to provide a stable revenue stream for the company.

 

In addition to the New Jersey market, the Company, through its Dream Building LLC subsidiary, has become licensed in Florida to pursue recent opportunities for elevation, restoration, renovation and new construction brought about by the damage caused by recent hurricanes. Initial markets to be targeted are located primarily in the southwest portion of the state, between Naples and Cape Coral.

 

Dream Building LLC. operates as a wholly owned subsidiary of Dream Homes and Development Corporation and continues to pursue opportunities in the real estate field, specifically in new home construction, home elevations and renovations. The amount of these projects currently under contract as of September 30, 2019 is $6,870,825.

 

In addition to the above projects, which are in process, Dream Building LLC has also estimated an additional $5,300,000 worth of residential construction projects and added over 200 active prospects to its data base. All these prospects are prime candidates for educational videos and short books on specific construction and rebuilding topics, as well as candidates for rebuilding projects to be built under the Dream Building LLC division.

 

In addition to the projects which the Company currently has under contract for elevation, renovation, new construction and development, there are a number of parcels of land which the Company has the ability to secure, whether through land contract or other types of options. These parcels represent additional opportunities for development and construction potential on the order of an additional 400 - 800 lots and/or residential units to be developed and built within an approximate time horizon of 5 years. Conceivably, this volume of production could yield $120,000,000 - $240,000,000 in gross revenue and $25,000,000 - $50,000,000 in earnings to the Company.

 

 3 
 

 

Properties currently under contract to purchase and in the development stage

 

Dream Homes is in contract and under development for a parcel which will yield 58 new townhomes in the Ocean County NJ area. This acquisition was made for common stock and occurred in the 4th quarter of 2016. This property is currently in the approval process. This development project is scheduled to begin in 2020 and is projected to add approximately $13,000,000 to the Company’s gross sales, through its Dream Building LLC division.

 

The Company has received preliminary CAFRA approval for the 58-unit townhouse development. A planning board hearing for preliminary and final site plan and subdivision approval occurred on December 11, 2017, which produced input and comments from the Planning Board as well as surrounding homeowners. Currently, the property is subject to an application with the state planning commission to be designated as a CAFRA Town Center property, which will enable greater density. As such the planning board has agreed to reschedule the hearing pending passage of this planning zone by New Jersey.

  

The Company has signed a contract for 48 waterfront townhomes with boat slips in Lacey, NJ. The project is currently in the approval process and significant engineering, environmental, traffic and architectural work has been completed. The property is partially improved with all boat slips built. This development is currently in a holding pattern, pending the receipt of a CAFRA Town Center designation from the New Jersey Department of Environmental Protection.

 

On April 24, 2018, the Company signed a contract to purchase a single-family waterview home in Ocean Township, NJ for $68,000, which later closed on July 11, 2018. The property was submitted for a variance and approved in January of 2019. The home is in need of elevation and renovation, which is expected to cost an additional $125,000. The Company has renovated and is in the process of selling the property. The property is expected to sell to a 3rd party purchasers for approximately $400,000. The Company sold 49% of the equity interest to a private investor.

 

On May 3, 2018, the Company submitted a signed letter of intent to purchase 5.5 acres of property in Gloucester County, which is currently being approved for a 120-unit apartment complex. The Company has a signed contract and has been proceeding with development approvals.

 

On May 11, 2018, the Company received back a signed letter of intent to purchase 2.3 acres of property in Berkeley Township, NJ. The Company is currently in contract to purchase the property. The property was previously approved for 12 duplex residential units. A contract has been signed on this property and the Company is currently in the development and approval stages. The proposed development will yield 17 townhomes.

 

On December 7, 2018, the Company signed a contract to purchase a property in Gloucester County, NJ, which will be approved for +/- 77 units of age-restricted housing. The property is currently in the approval stage. An application was made to the DEP for a wetlands letter of interpretation, which is currently pending.

 

A revised 3rd letter of intent (LOI) has just been offered to acquire 70 townhouse lots in Ocean County, NJ and it is Management’s opinion that this property is moving forward to contract. This property is approved and unimproved. The project is slated to begin in the early part of 2020 and has a retail value of $17 million. A contract to acquire this property was signed in October or 2019. It is anticipated that this property will close in spring of 2020 and construction will begin immediately.

 

Properties in discussion with signed letters of intent, not in contract

 

A letter of intent (LOI) has just been offered to acquire property to develop 15 single family homes in central Ocean County, NJ and it is Management’s opinion that this property is moving forward to contract. This property is unapproved and unimproved.

  

Discussions have been occurring since December of 2017 and a signed letter of intent has been offered to acquire property to develop 102 townhome units in southern Ocean County, NJ. This property was originally in contract and under development by the Company’s management team during the 2006-2009 period, at which time the project was not finalized due to the financial crisis of 2009. As such, a large amount of engineering, environmental, traffic and architectural work has been completed. It is Management’s opinion that this property is moving forward to contract. This property is not fully approved and is unimproved. Development and approval work for the project is slated to begin in late 2019 / early 2020. The project has a retail value of $23 million.

 

On May 17, 2018, the Company submitted a signed contract to purchase a 700 KW property to be developed as a solar farm in Glassboro, NJ. The purchase price is $700,000 and the contract is subject to obtaining funding for the solar array as well as a portion of the purchase price. There is also a PPA (power production agreement) in place with a nursing home adjacent to the property, to purchase the entire electrical output for the next 20 years. This property is still available and is on hold pending funding availability.

 

 4 
 

 

These new developments with signed letters of intent, as well as the four developments that are under contract and in development represent over $108 million in new home construction projects on the books in the next few years. This work will occur over the next 3-4 years and is in addition to the elevation/renovation division of the business. Management is very positive about these new developments, as well as the cutting-edge construction technologies being employed to create healthier, safer, more energy efficient homes.

 

Dream Homes has experienced solid growth in both the new home and elevation divisions, as well as strong additions to our personnel infrastructure, which are just now beginning to bear fruit. Our new Modular Home Showroom in Little Egg Harbor has also led to an increase in modular traffic and sales, as well as facilitated and increased client selections throughout our entire region.

 

The Company was awarded the Ocean County Best of the Best Awards for 2017, 2018 & 2019 in two categories (Best Custom Modular Builder and Best Home Improvement Contractor), which has caused significant new awareness and interest from the public. This has led to more showroom traffic, completed estimates and signed contracts. Referrals about Dream Homes are also being generated from many industry professionals, such as architects, engineers and attorneys, who’ve either had clients with abandoned projects or simply want to retain Dream due to superior performance and reliability.

 

The phrase ‘The Region’s Most Trusted Builder’ accurately describes the company and is becoming increasingly well known to homeowners in need of new homes, elevation & renovation work. The management team has never failed to complete a project in over 24 years in the industry.

 

The Company’s business model over the last year has been focused on increasing the new home and new development portion of our business, until it represents 50% - 70% of our entire revenue stream, from the current level of 20%. New home development has a much greater scalability and growth potential than elevation/renovation work. The Company has enjoyed steady growth in the renovation/elevation portion of the company and anticipates that by year end 2018 each part of the company (new homes and elevation work) will represent 50% of total revenue. By mid-year 2019, new home construction and development should represent over 70% of revenue.

 

Management hopes for steady growth in all segments of the company, since the rebuilding process will occur over the next 15-20 years. The combined total number of homes affected by Storm Sandy that will need to be raised or demolished and rebuilt is in excess of 30,000 homes, of which less than 10,000 have been rebuilt. This remaining combined market for new construction and elevation projects in the Company’s market area is estimated to be in the range of $3.4 billion dollars. The company anticipates being able to efficiently address 5% - 10% of this market. Dream Homes’ potential operations include the development and sale of a variety of residential communities, including construction of semi-custom homes, entry-level and first time move-up single-family and multi-family homes.

 

Among the Company’s other assets that are currently held, are the rights to operate the educational construction seminar known as “Dream Homes Nearly Famous Rebuilding Seminar”, as well as the informational blog known as the “Dream Homes Rebuilding Blog.”

  

The Nearly Famous Rebuilding Seminar is held at several times throughout the year, and is a powerful educational tool for homeowners who need of rebuilding or renovations. This seminar has been presented steadily since early 2013, and is designed to educate and assist homeowners in deciphering the confusion about planning and executing complex residential construction projects.

 

Due to the opportunities afforded by the market conditions, Dream Homes and Development Corporation as well as Dream Building LLC, which operates as a wholly owned subsidiary of Dream, will continue to pursue opportunities in the construction and real estate field, specifically in new home construction, home elevations and renovations.

 

 5 
 

 

RESULTS OF OPERATIONS – DREAM HOMES & DEVELOPMENT CORPORATION

 

The summary below should be referenced in connection with a review of the following discussion of our results of operations for the nine months ended September 30, 2019 and 2018.

 

STATEMENTS OF OPERATIONS

Unaudited

 

   Nine months ended
September 30, 2019
   Nine months ended
September 30, 2018
 
   Unaudited   Unaudited 
Revenue:          
Construction contracts  $2,095,417   $1,927,457 
Total revenue   2,095,417    1,927,457 
           
Cost of construction contracts   1,399,922    1,179,785 
           
Gross profit   695,495    747,672 
           
Operating Expenses:          
Selling, general and administrative, including stock based compensation of $ 110,194 and $ 86,774 , respectively   760,954    700,535 
Depreciation expense   4,576    3,684 
           
Total operating expenses   765,530    704,219 
           
Income (loss) from operations   (70,035)   43,453 
           
Other expenses (income):          
Cancellation of debt   (12,000)   - 
Interest expense   1,470    - 
Total other expenses (income)   (10,530)   - 
           
Net income (loss) before income taxes   (59,505)   43,453 
Provision for income tax (expense)   (15,206)   - 
           
Net income (loss)  $(74,711)  $43,453 
           
Basic and diluted income (loss) per common share  $(.00)  $.00 
           
Weighted average common shares outstanding-basic and diluted   24,915,346    24,200,953 

 

Results of Operations - Comparison for the nine months ended September 30, 2019 and 2018.

 

Revenues

 

For the nine months ended September 30, 2019 and 2018, revenues were $2,095,41 and $1,927,457 respectively. The increase in revenue of $16,960, was due to new contracts.

 

Cost of Sales

 

For the nine months ended September 30, 2019 and 2018, cost of construction contracts were $1,399,922 and $1,179,785, respectively. This increase of $220,137 was due mainly to increased production.

 

 6 
 

 

Operating Expenses

 

Operating expenses increased $61,311 from $704,219 in 2018 to $765,530 in 2019.

 

Liquidity and Capital Resources

 

As of September 30, 2019 and December 31, 2018, our cash balance was $54,395 and $118,687, respectively, total assets were $1,078,961 and $979,650, respectively, and total current liabilities amounted to $641,438 and $665,610, respectively, including loans payable to related parties of $54,352 and $52,243, respectively. As of September 30, 2019 and December 31, 2018, the total stockholders’ equity was $437,523 and $314,040, respectively. We may seek additional capital to fund potential costs associated with expansion and/or acquisitions.

 

Inflation

 

The impact of inflation on the costs of our company, and the ability to pass on cost increases to its subscribers over time is dependent upon market conditions. We are not aware of any inflationary pressures that have had any significant impact on our operations since inception, and we do not anticipate that inflationary factors will have a significant impact on future operations.

 

OFF-BALANCE SHEET ARRANGEMENTS

 

We do not maintain off-balance sheet arrangements nor do we participate in non-exchange traded contracts requiring fair value accounting treatment.

 

Item 3. Quantitative and Qualitative Disclosures About Market Risk.

 

Not applicable.

 

Item 4. Controls and Procedures.

 

Disclosure Controls and Procedures

 

The Company has adopted and maintains disclosure controls and procedures that are designed to provide reasonable assurance that information required to be disclosed in the reports filed under the Exchange Act, such as this Form 10-Q, is collected, recorded, processed, summarized and reported within the time periods specified in the rules of the Securities and Exchange Commission. The Company’s disclosure controls and procedures are also designed to ensure that such information is accumulated and communicated to management to allow timely decisions regarding required disclosure. As required under Exchange Act Rule 13a-15, the Company’s management, including the Principal Executive Officer and Principal Financial Officer, has conducted an evaluation of the effectiveness of disclosure controls and procedures as of the end of the period covered by this report. Based upon that evaluation, the Company’s President concluded that the Company’s disclosure controls and procedures are not effective to ensure that information required to be disclosed by the Company in the reports that the Company files or submits under the Exchange Act, is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the Company’s management, including the Company’s President, as appropriate, to allow timely decisions regarding required disclosure.

 

PART II - OTHER INFORMATION

 

Item 1. Legal Proceedings.

 

None.

 

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

 

None.

 

 7 
 

 

Item 3. Defaults upon Senior Securities.

 

None.

 

Item 4. Mine Safety Disclosure

 

Not Applicable.

 

Item 5. Other Information.

 

None.

 

Item 6. Exhibits.

 

The following exhibits are included with this filing:

 

3.1* Articles of Incorporation (Form S-1 Registration No. 333-174674 filed June 2, 2011).

 

3.2* By-laws (Form S-1 Registration No. 333-174674 filed June 2, 2011).

 

4.1* Specimen Stock Certificate (Form S-1 Registration No. 333-174674 filed June 2, 2011).

 

10.1* Intellectual Property Purchase Agreement (Form S-1 Registration No. 333-174674 filed June 2, 2011).

 

10.2* Consulting Agreement with William Kazmierczak 5-22-2010 (Form S-1 Registration No. 333-174674 filed June 2, 2011).

 

31.1 Sarbanes-Oxley Section 302 certification by Vincent Simonelli

 

32.2 Sarbanes-Oxley Section 906 certification by Vincent Simonelli

 

* Previously filed and Incorporated by reference.

 

 8 
 

 

SIGNATURES

 

Pursuant to the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on behalf by the undersigned; duly authorized.

 

Date: January 23, 2020 Dream Homes & Development Corporation
   
  By:  /s/ Vincent Simonelli
    Vincent Simonelli
    Chief Executive Officer and Chief Financial Officer

 

 9 
 

EX-31.1 2 ex31-1.htm

 

EXHIBIT 31

 

CERTIFICATIONS

 

I, Vincent C. Simonelli, certify that:

 

1. I have reviewed this quarterly report of Dream Homes & Development Corporation.;

 

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

 

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the issuer as of, and for, the periods presented in this report;

 

4. The issuer’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as 4efined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the issuer and have:

 

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

 

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

 

(c) Evaluated the effectiveness of the issuer’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

 

(d) Disclosed in this report any change in the issuer’s internal control over financial reporting that occurred during the issuer’s most recent fiscal quarter (the issuer’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the issuer’s internal control over financial reporting; and

 

5. The issuer’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the issuer’s auditors and the audit committee of the issuer’s board of directors (or persons performing the equivalent functions):

 

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the issuer’s ability to record, process, summarize and report financial information; and

 

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the issuer’s internal control over financial reporting.

 

Date: January 23, 2020  
   
/s/ Vincent C. Simonelli  
CEO and CFO  

 

  
 

 

EX-32.1 3 ex32-1.htm

 

EXHIBIT 32

 

CERTIFICATION PURSUANT TO
18 U.S.C. SECTION 1350,
AS ADOPTED PURSUANT TO SECTION 906
OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the quarterly report of Dream Homes & Development Corporation (the “Company”) on Form 10-Q for the quarter ended September 30, 2019 (the “Report”), as filed with the Securities and Exchange Commission on the date hereof, I, Vincent C. Simonelli, CEO and CFO of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

 

1. The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

 

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

 

/s/ Vincent C. Simonelli  
CEO and CFO  

 

Dated: January 23, 2020

 

A signed original of this written statement required by Section 906 has been provided to Dream Homes & Development Corporation and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

 

  
 

 

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Contract to acquire hometown description. 4 Improved Lots [Member] Improved Lot One [Member] Improved Lot Two [Member] Improved Lot Three [Member] Improved Lot Four [Member] Fair value of warrants. Warrants, cancelled. Clayton - 120 Apartments [Member] Bayville-17 Units [Member] Louis Ave - Bayville 17 Units [Member] Station Dr - Forked River [Member] 201 East Ave - Clayton - 77 Units [Member] Academy St - Clayton - 2 Lots [Member] Fairview Development - Clayton 120 Units [Member] Lackland (Pines Contract) [Member] Two Individuals [Member] Six Individuals [Member] Secretary and VP [Member] April 28, 2017 to December 31, 2020 [Member] Lacey Township, New Jersy. Marina Contract [Member] Employment Agreement [Member] ConstructionContractMember Assets, Current Assets Liabilities, Current Stockholders' Equity Attributable to Parent Liabilities and Equity Operating Expenses Operating Income (Loss) Nonoperating Income (Expense) Income (Loss) from Continuing Operations before Equity Method Investments, Income Taxes, Noncontrolling Interest Income Tax Expense (Benefit) WriteoffOfNotePayable Increase (Decrease) in Accounts Receivable Increase (Decrease) in Contract with Customer, Asset Increase (Decrease) in Contract with Customer, Liability Net Cash Provided by (Used in) Operating Activities Payments to Acquire Land Net Cash Provided by (Used in) Investing Activities Repayments of Related Party Debt Net Cash Provided by (Used in) Financing Activities Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Including Disposal Group and Discontinued Operations Property, Plant and Equipment, Policy [Policy Text Block] Income Tax, Policy [Policy Text Block] Accumulated Depreciation, Depletion and Amortization, Property, Plant, and Equipment Deferred Tax Assets, Valuation Allowance Deferred Tax Assets, Net of Valuation Allowance EX-101.PRE 9 drem-20190930_pre.xml XBRL PRESENTATION FILE XML 10 R7.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Consolidated Statements of Cash Flows (Unaudited) (Parenthetical)
9 Months Ended
Sep. 30, 2019
shares
Statement of Cash Flows [Abstract]  
Issuance of shares of common stock for debt reduction 1,100,000
XML 11 R3.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Consolidated Balance Sheets (Parenthetical) - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Statement of Financial Position [Abstract]    
Allowance for doubtful accounts receivable, current $ 29,838 $ 29,838
Allowance for doubtful accounts receivable, non-current $ 43,000 $ 43,000
Preferred stock, shares authorized 5,000,000 5,000,000
Preferred stock, par value $ .001 $ 0.001
Preferred stock, shares outstanding
Common stock, shares authorized 70,000,000 70,000,000
Common stock, par value $ .001 $ .001
Common stock, shares outstanding 25,878,993 24,200,953
Common stock, shares subscribed but unissued 16,000
XML 12 R19.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Subsequent Events
9 Months Ended
Sep. 30, 2019
Subsequent Events [Abstract]  
Subsequent Events

12- Subsequent Events

 

A contract was signed to acquire 70 approved townhome units in October 2019, after 31 months of discussion. A contract was signed to purchase 52 approved townhome units in Forked River, NJ.

XML 13 R11.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Loans Payable to Related Parties
9 Months Ended
Sep. 30, 2019
Debt Disclosure [Abstract]  
Loans Payable to Related Parties

4-Loans Payable to Related Parties

 

Loans payable to related parties is summarized as follows:

 

    September 30, 2019     December 31, 2018  
             
Loans payable to chief executive officer   $ 70,634     $ 29,025  
Loans payable to GPIL     3,118       3,118  
Loan payable to DHL     (19,400 )     20,100  
Net total   $ 54,352     $ 52,243  

 

All the loans above are non-interest bearing and due on demand.

XML 14 R15.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Commitments and Contingencies
9 Months Ended
Sep. 30, 2019
Commitments and Contingencies Disclosure [Abstract]  
Commitments and Contingencies

8- Commitments and Contingencies

 

Construction Contracts

 

As of September 30, 2019, Dream Building, LLC is committed under 26 construction contracts outstanding with homeowners with contract prices totaling $ 6,870,825, which are being fulfilled in the ordinary course of business. None of these construction projects are expected to take significantly in excess of one year to complete from commencement of construction. The Company has no significant commitments with material suppliers or subcontractors that involve any sums of substance or, of long-term duration at the date of issuance of these financial statements.

 

Employment Agreements

 

On April 28, 2017, DHDC executed an Employment Agreement with a Vice President of Business Development. The term of the agreement was scheduled to run from April 28, 2017 to December 31, 2020, unless otherwise cancelled, and was renewable thereafter at 1-year intervals based on certain sales targets. The agreement provided for compensation based on sales. This person stopped working for the Company at the end of 2018 and the agreement was cancelled accordingly.

 

On May 8, 2017, DHDC executed an Employment Agreement with a newly appointed Sales Manager. The term of the agreement is from May 8, 2017 to May 8, 2019 and was renewable thereafter at 1-year intervals based on certain sales targets. That agreement has been renewed and is currently in force. The agreement provides for compensation based on sales.

 

Lease Agreement

 

On June 20, 2017, DHDC executed a lease for office and storage space located at 2109 Bridge Avenue, Point Pleasant, New Jersey. The term of the Lease is five years from June 20, 2017 to June 20, 2022 with two (2) five (5) year options to renew. The Lease provides for monthly rent commencing August 20, 2017 at $1,200 per month until the earlier of completion of upstairs offices or November 20, 2017, at which time the monthly rent increases to $2,200 per month. Assuming DHDC is current in all rent and other charges, DHDC has the option to cancel the Lease with 90 days written notice to Landlord.

 

For the nine months ended September 30, 2019, rent expense under this lease agreement was $12,600. Monthly lease payments were changed to $1,000 per month as of 3/31/19.

 

This lease has ended as of 12/31/19 and the Company has vacated the premises. The Company is seeking other showroom office space in northern Ocean and southern Monmouth Counties.

 

Investor Relations Agreement

 

On February 10, 2017, the Company entered into an Investor Relations and Consulting Services Agreement with an investor relations firm. The agreement expired on August 31, 2017 and provided for issuance of 56,000 restricted shares of common stock valued at $2,800 to the investor relations firm (stock issued on February 22, 2017) and $2,000 per month fees to be paid to the investor relations firm commencing March 2017.

 

For the nine months ended September 30, 2019 and 2018, consulting fees expense under this agreement was $0 and $2,000, respectively. This Agreement is no longer in effect on any type of constant basis, and the services of the Consultant are being utilized on an as-needed basis.

 

Line of Credit

 

On September 15, 2016, DHDC established a $50,000 line of credit with General Development Corp., a non-bank lender. Advances under the line bear interest at a rate of 12%, with interest being payable on demand. The outstanding principal is due and payable in 60 months. The line is secured by the personal guarantee of the Company’s Chief Executive Officer. The agreement to fund automatically renews on a yearly basis as long as interest payments are current. To date, the Company has received several advances under the line of credit. As of 12/31/19, the outstanding principal balance was $162,000. Interest expense was brought current as of 1/3/20.

 

Private Placement

 

On November 3, 2017, the Company released a Private Placement Memorandum, which consists of an equity and debt offering for up to $5,000,000 in new capital. This capital will be utilized for acquisition and development of several of the properties the Company has under contract, as well as expansion into the Florida market. The offering is comprised of Units for sale as well as convertible debt. Each Unit is priced at $.40 per common share and includes 1 warrant to purchase an additional share of common stock for $.60 within 3 years of the date of Unit purchase. The convertible debt is offered at an 8% coupon, paid quarterly, has a maturity of 4 years and is convertible at $.75 per share. The offering was scheduled to close on January 2, 2018 and was extended unchanged by the Company to September 2, 2018.

 

As of May 21,, 2018, the Company has sold a total of 68,810 units and received $16,400 in cash ($5,000 in December 2017 for 12,500 units, $6,400 in January 2018 for 16,000 units and $5000 in February 2018 for 12,500 units) and was granted a reduction in accounts payable from a lumber vendor of 11,124 for 27,810 units issuable to the vendor as of December 31, 2017.

XML 15 R36.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Commitments and Contingencies (Details Narrative)
1 Months Ended 3 Months Ended 9 Months Ended
May 21, 2018
USD ($)
shares
Nov. 03, 2017
USD ($)
$ / shares
shares
Aug. 20, 2017
USD ($)
Jun. 20, 2017
USD ($)
May 08, 2017
Apr. 28, 2017
Apr. 26, 2017
shares
Feb. 10, 2017
USD ($)
shares
Sep. 15, 2016
USD ($)
Feb. 28, 2018
USD ($)
shares
Jan. 31, 2018
USD ($)
shares
Dec. 31, 2017
USD ($)
shares
Apr. 30, 2017
USD ($)
shares
Mar. 31, 2019
USD ($)
Sep. 30, 2019
USD ($)
Integer
Sep. 30, 2018
USD ($)
Dec. 31, 2019
USD ($)
Line of credit                                 $ 162,000
Sale of stock, shares | shares 68,810                                
Sale of stock during period, value $ 16,400                                
Lumber Vendor [Member]                                  
Sale of stock, shares | shares                   12,500 16,000 12,500          
Sale of stock during period, value                   $ 5,000 $ 6,400 $ 5,000          
Number common stock shares issued for reduction of accounts payable | shares                       11,124          
Vendor [Member]                                  
Number common stock shares issued for reduction of accounts payable | shares                       27,810          
Private Placement [Member]                                  
Equity and debt offering   $ 5,000,000                              
Unit issued price per share | $ / shares   $ 0.40                              
Warrants purchase of common stock shares | shares   1                              
Warrants exercise price per share | $ / shares   $ 0.60                              
Offering period   Within 3 years of the date of Unit purchase.                              
Private Placement [Member] | Convertible Debt [Member]                                  
Debt offered percentage   8.00%                              
Debt instrument, maturity period   4 years                              
Debt conversion price per share | $ / shares   $ 0.75                              
Debt instrument, offering date   Jan. 02, 2018                              
Debt instrument, extended date   Sep. 02, 2018                              
May 8 2017 to May 8 2019 [Member] | Sales Manager [Member]                                  
Agreement term interval based         1 year                        
Employment Agreement [Member] | April 28, 2017 to December 31, 2020 [Member]                                  
Agreement term interval based           1 year                      
Lease Agreement [Member]                                  
Rent expense     $ 1,200                       $ 12,600    
Monthly lease payments                           $ 1,000      
Lease Agreement [Member] | June 20 2017 to June 20 2022 [Member]                                  
Lease term       5 years                          
Lease term of renewal       5 years                          
Lease Agreement [Member] | November 20 2017 [Member]                                  
Rent expense       $ 2,200                          
Investor Relations and Consulting Services Agreement [Member]                                  
Consulting fees expense                             $ 0 $ 2,000  
Investor Relations and Consulting Services Agreement [Member] | Investor [Member]                                  
Agreement expiration term               Aug. 31, 2017                  
Number of restricted stock issued during period | shares               56,000                  
Number of restricted stock issued during period, value               $ 2,800                  
Fees payment to investor               $ 2,000                  
General Development Corp [Member]                                  
Number of restricted stock issued during period | shares             100,000           100,000        
Number of restricted stock issued during period, value                         $ 5,000        
General Development Corp [Member] | Nonbank Lender [Member]                                  
Line of credit                 $ 50,000                
Line of credit interest rate                 12.00%                
Line of credit facility principal due payable terms                 Outstanding principal is due and payable in 60 months.                
Construction Contracts [Member]                                  
Number of contracts assigned | Integer                             26    
Construction Contracts [Member] | Dream Building, LLC [Member]                                  
Construction contract price                             $ 6,870,825    
XML 16 R32.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Income Taxes (Details Narrative)
9 Months Ended 12 Months Ended
Sep. 30, 2019
Dec. 31, 2018
Income Tax Disclosure [Abstract]    
Federal income tax rate 21.00% 21.00%
XML 17 R23.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Loans Payable to Related Parties (Tables)
9 Months Ended
Sep. 30, 2019
Debt Disclosure [Abstract]  
Schedule of Loans Payable to Related Parties

Loans payable to related parties is summarized as follows:

 

    September 30, 2019     December 31, 2018  
             
Loans payable to chief executive officer   $ 70,634     $ 29,025  
Loans payable to GPIL     3,118       3,118  
Loan payable to DHL     (19,400 )     20,100  
Net total   $ 54,352     $ 52,243  

XML 18 R27.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Property and Equipment - Schedule of Property and Equipment (Details) - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Less: Accumulated depreciation $ (29,026) $ (24,449)
Property and Equipment- net 34,154 10,731
Office Equipment [Member]    
Property and equipment, gross 4,115 4,115
Vehicles/Modular Office [Member]    
Property and equipment, gross $ 59,065 $ 31,065
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Deposits and Costs Coincident to Acquisition of Land for Development (Tables)
9 Months Ended
Sep. 30, 2019
Real Estate [Abstract]  
Schedule of Deposits and Costs Coincident to Acquisition of Land for Development

Deposits and costs coincident to acquisition of land for development are summarized as follows:

 

    September 30, 2019     December 31, 2018  
             
Lacey Township, New Jersey, Marina contract:                
Deposit     25,000       25,000  
Site engineering, permits and other costs:     49,959       49,959  
Total Marina Contract     74,959       74,959  
                 
Other Deposits:                
Clayton - 120 apartments     54,467       9,920  
71 Sheridan Avenue     79,150       79,150  
Bayville-17 units     30,949       2,674  
Other     7,726       2,005  
                 
Lacey Township, New Jersey, Pines contract:                
                 
Deposit     -       -  
Cost to acquire contract     10,000       10,000  
Site engineering, permits, and other costs     109,265       109,265  
Total Pines contract     119,265       119,265  
                 
Berkeley Township, New Jersey, Tallwoods contract:                
Deposit     10,000       10,000  
Site engineering, permits, and other costs     86,442       62,994  
Total Tallwoods contract     96,442       72,994  
                 
Louis Ave – Bayville 17 units     30,949       -  
Station Dr – Forked River     54,109       -  
201 East Ave – Clayton – 77 units     52,200       -  
Academy St – Clayton – 2 lots     3,199       -  
Fairview Development – Clayton 120 units     6,874       -  
Lackland (Pines contract)     (6,5532 )     -  
                 
Total   $ 575,482     $ 360,967  

XML 22 R26.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Property and Equipment (Details Narrative) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Property, Plant and Equipment [Abstract]        
Depreciation expense $ 1,653 $ 1,228 $ 4,576 $ 3,684
XML 23 R6.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Consolidated Statements of Cash Flows (Unaudited) - USD ($)
3 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Dec. 31, 2018
Statement of Cash Flows [Abstract]          
Net income (loss) $ (24,309) $ 55,815 $ (74,711) $ 43,453  
Adjustments to reconcile net income (loss) to net cash provided (used) in operating activities:          
Depreciation expense 1,653 1,228 4,576 3,684  
Write-off on deposits and acquisition of land     28,102  
Stock-based compensation 0 18,798 110,194 86,774  
Write-off of note payable     (12,000)  
Changes in operating assets and liabilities:          
Accounts receivable     15,392 (27,003)  
Costs in excess of billings and estimated earnings     58,743 (119,014)  
Accounts payable and accrued liabilities     177,116 (74,640)  
Accrued income tax     15,206  
Billings in excess of costs and estimated earnings     (198,603) 34,973  
Net cash provided in operating activities     124,015 (51,772)  
INVESTING ACTIVITIES          
Purchase of vehicles     (28,000)  
Deposit and costs coincident to acquisition of land for development     (184,120) (98,411)  
Net cash (used) in investing activities     (212,120) (98,411)  
FINANCING ACTIVITIES          
Payments on loans to related parties     (17,314)  
Proceeds from related parties     40,927 40,000  
Proceeds from loans     20,000  
Proceeds from sale of common stock     11,400  
Net cash provided by financing activities     23,613 71,400  
NET INCREASE (DECREASE) IN CASH     (64,492) (78,783)  
CASH BALANCE, BEGINNING OF PERIOD     118,687 244,684 $ 244,684
CASH BALANCE, END OF PERIOD $ 54,195 $ 165,901 54,195 165,901 $ 118,687
Supplemental Disclosures of Cash Flow Information:          
Interest paid     1,470  
Income taxes paid      
Non-Cash Investing and Financing Activities:          
Issuance of 1,100,000 shares of common stock for debt reduction     $ 110,000  
XML 24 R2.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Consolidated Balance Sheets - USD ($)
Sep. 30, 2019
Dec. 31, 2018
CURRENT ASSETS    
Cash $ 54,195 $ 118,687
Accounts receivable, net of allowance for doubtful accounts ($29,838) 333,826 349,218
Costs in excess of billings and estimated earnings 47,104 105,847
Total current assets 435,125 573,752
PROPERTY AND EQUIPMENT, net 34,154 10,731
OTHER ASSETS    
Security deposit 2,200 2,200
Accounts receivable , net of allowance for doubtful accounts ($43,000) 32,000 32,000
Deposits and costs coincident to acquisition of land for Development 575,482 360,967
Total assets 1,078,961 979,650
CURRENT LIABILITIES    
Accounts payable and accrued expenses 494,750 317,634
Billings in excess of costs and estimated earnings 55,605 254,208
Accrued income taxes 36,731 21,525
Loans payable 20,000
Loans payable to related parties 54,352 52,243
Total current liabilities 641,438 665,610
STOCKHOLDERS' EQUITY    
Preferred stock; 5,000,000 shares authorized, $.001 par value, as of September 30, 2019 and December 31, 2018, there are no shares outstanding
Common stock; 70,000,000 shares authorized, $.001 par value, as of September 30, 2019 and December 31, 2018, there are 25,878,993 and 24,200,953 shares outstanding, respectively; and 16,000 shares committed not yet issued at December 31, 2018 respectively 25,879 24,201
Additional paid-in capital 1,868,504 1,671,988
Accumulated deficit (1,456,860) (1,382,149)
Total stockholders' equity 437,523 314,040
Total liabilities and stockholders' equity $ 1,078,961 $ 979,650
XML 25 R10.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Deposits and Costs Coincident to Acquisition of Land for Development
9 Months Ended
Sep. 30, 2019
Real Estate [Abstract]  
Deposits and Costs Coincident to Acquisition of Land for Development

3- Deposits and Costs Coincident to Acquisition of Land for Development

 

Deposits and costs coincident to acquisition of land for development are summarized as follows:

 

    September 30, 2019     December 31, 2018  
             
Lacey Township, New Jersey, Marina contract:                
Deposit     25,000       25,000  
Site engineering, permits and other costs:     49,959       49,959  
Total Marina Contract     74,959       74,959  
                 
Other Deposits:                
Clayton - 120 apartments     54,467       9,920  
71 Sheridan Avenue     79,150       79,150  
Bayville-17 units     30,949       2,674  
Other     7,726       2,005  
                 
Lacey Township, New Jersey, Pines contract:                
                 
Deposit     -       -  
Cost to acquire contract     10,000       10,000  
Site engineering, permits, and other costs     109,265       109,265  
Total Pines contract     119,265       119,265  
                 
Berkeley Township, New Jersey, Tallwoods contract:                
Deposit     10,000       10,000  
Site engineering, permits, and other costs     86,442       62,994  
Total Tallwoods contract     96,442       72,994  
                 
Louis Ave – Bayville 17 units     30,949       -  
Station Dr – Forked River     54,109       -  
201 East Ave – Clayton – 77 units     52,200       -  
Academy St – Clayton – 2 lots     3,199       -  
Fairview Development – Clayton 120 units     6,874       -  
Lackland (Pines contract)     (6,5532 )     -  
                 
Total   $ 575,482     $ 360,967  

 

Lacey Township, New Jersey, “Dream Homes at the Pines”, Contract

 

On December 15, 2016, the Company acquired from General Development Corp. (“GDC”) rights to a contract to purchase over 9 acres of undeveloped land without amenities in Lacey Township, New Jersey (the “Lacey Contract or Dream Homes at the Pines”) for $15,000 cash (paid in December 2016) and 100,000 restricted shares of Company common stock (issued in April 2017) valued at $5,000. GDC acquired the rights to the contract from DHL on December 14, 2016 for $10,000 cash. As discussed in Note 9, Commitments and Contingencies under Line of Credit, the Company also has an available line of credit of $50,000 with GDC.

  

The Lacey Contract between DHL and the seller of the land was dated March 18, 2016 and provides for a $1,000,000 purchase price with closing on or about 60 days after memorialization of final Development Approvals has been obtained. DHL paid the seller a $10,000 refundable deposit in March 2016 pursuant to the Lacey Contract. In the event the transaction has not closed on at least a portion of the property within 24 months of the completion of the Due Diligence Period (as may be extended by two 6- month extensions), the seller has the option of terminating the contract. Notwithstanding this provision, the Company retains the right at all times to waive any remaining contingencies and proceed to close on the property.

 

Due diligence for the above property was completed as of May 17, 2016, and all costs were incurred by Dream Homes Ltd., which was in the contract for the property at the time. No additional costs for due diligence have been incurred by the Company, nor are any anticipated. The Company will incur all current costs associated with this property necessary to obtain all approvals, acquire the land, install the infrastructure and prepare the property to commence construction.

 

In order to obtain all developmental approvals and be prepared to begin installing infrastructure, various permits and engineering work are required. These permits include but are not limited to township subdivision, county, municipal utility authority, CAFRA (NJ Department of Environmental Protection) and NJ Department of Transportation. To date, design engineering has been completed and a CAFRA application has been prepared and submitted to the environmental scientist, along with a check for $36,750 payable to the NJ DEP. Application for this permit was made in April 2017. As of this date, the CAFRA application has been put on hold pending a determination if the township will be approved by the State of New Jersey for a CAFRA Town Center designation. A permit is expected to be issued in June or July of 2018. A Lacey Township Planning Board meeting was held on December 11, 2017. Additional information was requested from the board and the next meeting will be scheduled upon receipt of outside agency permits and the other requested information.

 

It is anticipated that complete development approvals will cost approximately $50,000 more to complete. In addition to these approval costs and acquisition costs, infrastructure costs are anticipated to cost approximately $1,000,000. The total amount of funding required to acquire and make this property ready for home construction is approximately $2,090,000 as of June 30, 2019.

 

The Company may need to seek loans from banks to finance this project. As part of their financing agreements, the banks typically require Vincent Simonelli to personally guarantee these loans. If Mr. Simonelli cannot qualify as a guarantor and there is no one other than him in the Corporation to provide those guarantees, the financing of the deal may be adversely affected. The exact amount of funding required for this particular property is not clear at the present time but will be determined when full approvals have been obtained and the Company is prepared to take title to the property.

 

Lacey Township, New Jersey, “Dream Homes at Forked River”, Marina Contract

 

The Company has acquired the rights to a purchase contract via contract assignment for 48 waterfront townhomes with boat slips in Lacey, NJ. The project is currently in the approval process and significant engineering, environmental, traffic and architectural work has been completed. The property is a waterfront property, and is partially improved with all boat slips currently installed, the Department of Transportation permit received and the curb cut from Route 9 in place. The property when completely constructed has a retail value of $21 million and is expected to begin site improvements in late 2018 or early 2019.

 

On December 8, 2017, the Company acquired from DHL rights to a contract to purchase over +/- 7.5 acres of land in Lacey Township, NJ (the “Marina Contract or Dream Homes at Forked River”) for 162,200 restricted shares of Company common stock (committed but not issued as of April 16, 2018). The Contract between DHL and the seller of the land was dated February 24, 2016 and provides for a $2,166,710 purchase price with closing on or about 60 days after final development approvals have been obtained and memorialized. DHL paid the seller a refundable $25,000 deposit in February 2016 pursuant to the Marina contract.

 

The due diligence period associated with this property expired on May 1, 2016 and all costs associated with same were paid by Dream Homes Ltd. prior to the expiration date. The Company will incur no further costs related to the due diligence aspect of this purchase. The Company will incur all current and future costs associated with this property necessary to obtain all approvals, acquire the land and prepare the property to commence construction.

 

The land is currently approved for a marina and it is the Company’s intention to modify the approvals to a townhome use, as per the ordinance. The property is currently unimproved. As such, the necessary steps required to bring the property through the approval process involve design engineering as well as environmental approvals. Accordingly, the remaining costs will primarily involve engineering, legal and approval costs.

 

At this time, the Company estimates that the total engineering and approval costs will be approximately $100,000. The amount of money required to purchase the property is $2,430,000 of which $25,000 is currently on deposit.

 

The Company may need to seek loans from banks to finance this project. As part of their financing agreements, the banks typically require Vincent Simonelli to personally guarantee these loans. If Mr. Simonelli cannot qualify as a guarantor and there is no one other than him in the Corporation to provide those guarantees, the financing of the deal may be adversely affected. The exact amount of funding required for this particular property is not clear at the present time but will be determined when full approvals have been obtained and the Company is prepared to take title to the property. This development is currently on hold pending a change in environmental regulations from the New Jersey Department of Environmental Protection concerning the CAFRA Town Center designation.

 

Little Egg Harbor Township, New Jersey, “Dream Homes at Radio Road”, Contract

 

On March 14, 2018, the Company signed a contract to purchase 4 improved lots in Little Egg Harbor Township, NJ (the “Dream Homes at Radio Road”) for a total of $260,000. The Contract between the Company and the seller of the land provides for a $65,000 per lot purchase price with closing occurring on a rolling basis, as each house is built and sold. In addition, the Company has obtained a term sheet on April 5, 2018 and is waiting for a formal commitment from 1st Constitution Bank for a funding facility comprised of acquisition and development funding.

 

The Company intends to begin construction in the second quarter and the homes are projected to sell in the $350,000 - $375,000 range.

 

Glassboro Township, New Jersey – Robin’s Nest Solar Farm

 

On May 28, 2018, the Company signed a contract to purchase a 700 KW property to be developed as a solar farm in Glassboro, NJ. The purchase price is $900,000 and the contract is subject to obtaining funding for the solar array as well as a portion of the purchase price. There is also a PPA (power production agreement) in place with a nursing home adjacent to the property, to purchase the entire electrical output for the next 20 years.

 

This acquisition has been put on hold pending availability of funding.

 

71 Sheridan Street, Waretown, NJ – Property purchased for renovation and sale

 

On July 12, 2018, the Company purchased a single-family home property located at 71 Sheridan Street in Waretown, NJ. The home was originally damaged by Storm Sandy, and requires elevation and renovation in order to be brought into compliance with the latest FEMA flood zone requirements. The Company intends to complete a full height elevation, enclose the lower level, install 2 levels of deck facing the water, renovate the house completely and sell the property.

 

Louis Avenue – Bayville, NJ – Property being developed

 

In October of 2018, the company entered into a contract to develop and acquire 17 townhouse lots in Bayville NJ. Engineering and approvals are currently in process.

XML 26 R14.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Business Segments
9 Months Ended
Sep. 30, 2019
Segment Reporting [Abstract]  
Business Segments

7- Business Segments

 

The company currently has one business segment which is residential construction, which is further divided into elevation/renovation, demolition and new home construction and new single and multi-family home developments. The residential construction segment is operated through DHDC’s wholly owned subsidiary Dream Building, LLC (since August 19, 2016).

XML 27 R18.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Receivable from Arbitration and Settlement of in Process Customer Construction Contract in Dispute and Related Losses Recognized and Recorded by the Company
9 Months Ended
Sep. 30, 2019
Contractors [Abstract]  
Receivable from Arbitration and Settlement of in Process Customer Construction Contract in Dispute and Related Losses Recognized and Recorded by the Company

11- Receivable from Arbitration and settlement of in process customer construction contract in dispute and related losses recognized and recorded by the Company

 

The Company began work on a construction contract in the amount of $307,000 in August 2016. Through September 30, 2017, the Company billed the customer a total of $219,565, collected a total of $130,247 from the customer, and accordingly had a balance due from the customer of $89,318 at September 30, 2017. When the customer refused to pay the $89,318 balance, the Company ceased working on the contract in July 2017, filed a request for arbitration on October 3, 2017, and filed a Construction Lien Claim on October 18, 2017. On March 6, 2018, the American Arbitration Association awarded the Company $75,000 in connection with its claim. To date the Company has not yet collected the $75,000 owing to it under the arbitration award. Based upon advice of Company Counsel it still has further legal actions available to it to ultimately facilitate payment from the customer of the $75,000 in the contract dispute. Accordingly, at December 31, 2017 the Company has recognized a loss of $14,318 on the write-down of accounts receivable from this customer which has been reflected as a reduction in revenue from construction contracts and gross profit for the year ended December 31, 2017.

 

At December 31, 2017, there was a “Costs and estimated earnings in excess of billings” asset relating to the Arbitration Award disputed contract of $48,419 representing the difference between the amount billed to the customer of $219,565 and costs and estimated earnings of $267,984 through December 31, 2017. Accordingly, at December 31, 2017 the Company has also recognized a loss of $48,419 on the write-down of the “Costs and estimated earnings in excess of billings” asset attributable to this disputed customer contract, which has been reflected as a reduction in revenue from construction contracts and gross profit for the year ended December 31, 2017. Over the life of this contract the Company recognized a cumulative gross profit of $17,658 through December 31, 2017, which is net of a negative gross profit of ($9,012) for the year ended December 31, 2017, based upon the write-down of $14,318 described in the preceding paragraph and the $48,419 write-down described in this paragraph, which aggregate to $62,732.

XML 28 R37.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Related Party Transactions (Details Narrative) - USD ($)
1 Months Ended 3 Months Ended 9 Months Ended
Apr. 30, 2017
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Selling, general and administrative expenses   $ 201,902 $ 98,344 $ 760,954 $ 700,535
Dream Homes, Ltd [Member]          
Selling, general and administrative expenses       277,949 $ 280,122
Chief Executive Officer [Member]          
Salary paid       57,000  
Secretary and VP [Member]          
Salary paid       40,800  
DHL [Member]          
Monthly rent $ 2,000     $ 18,000  
XML 29 R33.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Income Taxes - Schedule of States Federal Income Tax Rate Income Loss Before Income Taxes (Details) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Income Tax Disclosure [Abstract]        
Expected tax (benefit)     $ (12,496) $ (9,852)
State income taxes, net of Federal (benefit)     (5,298) (2,816)
Non-deductible stock-based compensation     33,000 14,275
Change in valuation allowance     (1,607)
Provision for income taxes $ (10,420) $ 15,206
XML 30 R28.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Deposits and Costs Coincident to Acquisition of Land for Development (Details Narrative)
1 Months Ended 9 Months Ended
May 28, 2018
USD ($)
Dec. 08, 2017
a
shares
Apr. 26, 2017
shares
Dec. 15, 2016
USD ($)
a
Dec. 14, 2016
USD ($)
Mar. 18, 2016
USD ($)
Feb. 24, 2016
USD ($)
Oct. 31, 2018
Apr. 30, 2017
USD ($)
shares
Sep. 30, 2019
USD ($)
Sep. 30, 2018
USD ($)
Jun. 30, 2019
USD ($)
Mar. 14, 2018
USD ($)
Real Estate [Line Items]                          
Payments to acquire land                   $ 28,000    
Louis Avenue - Bayville, NJ [Member]                          
Real Estate [Line Items]                          
Acquisition, description of acquired entity               The company entered into a contract to develop and acquire 17 townhouse lots in Bayville NJ. Engineering and approvals are currently in process.          
Lacey Township, New Jersy. Marina Contract [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                   21,000,000      
Dream Homes At Radio Road Contract [Member] | Little Egg Harbor Township, New Jersey [Member] | Minimum [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                   350,000      
Dream Homes At Radio Road Contract [Member] | Little Egg Harbor Township, New Jersey [Member] | Maximum [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                   375,000      
Dream Homes At Radio Road Contract [Member] | Little Egg Harbor Township, New Jersey [Member] | 4 Improved Lots [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                         $ 260,000
Dream Homes At Radio Road Contract [Member] | Little Egg Harbor Township, New Jersey [Member] | Improved Lot One [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                         65,000
Dream Homes At Radio Road Contract [Member] | Little Egg Harbor Township, New Jersey [Member] | Improved Lot Two [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                         65,000
Dream Homes At Radio Road Contract [Member] | Little Egg Harbor Township, New Jersey [Member] | Improved Lot Three [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                         65,000
Dream Homes At Radio Road Contract [Member] | Little Egg Harbor Township, New Jersey [Member] | Improved Lot Four [Member]                          
Real Estate [Line Items]                          
Constructed property retail value                         $ 65,000
700 KW Property Contract [Member] | Glassboro Township, New Jersey [Member]                          
Real Estate [Line Items]                          
Constructed property retail value $ 900,000                        
Acquisition, description of acquired entity The Company signed a contract to purchase a 700 KW property to be developed as a solar farm in Glassboro, NJ. The purchase price is $900,000 and the contract is subject to obtaining funding for the solar array as well as a portion of the purchase price. There is also a PPA (power production agreement) in place with a nursing home adjacent to the property, to purchase the entire electrical output for the next 20 years.                        
NJ Department of Transportation [Member]                          
Real Estate [Line Items]                          
Payable to local authorities                   36,750      
Dream Homes, Ltd [Member]                          
Real Estate [Line Items]                          
Refundable deposit           $ 10,000              
Development approval costs                       $ 50,000  
Infrastructure costs                       1,000,000  
Aggregate amount funding for home construction                       $ 2,090,000  
Lacey Contract [Member]                          
Real Estate [Line Items]                          
Purchase price           $ 1,000,000              
General Development Corp [Member]                          
Real Estate [Line Items]                          
Purchase of undeveloped land | a       9                  
Payments to acquire land       $ 15,000                  
Number of restricted stock issued during period | shares     100,000           100,000        
Number of restricted stock issued during period, value                 $ 5,000        
Payments to acquire management contract rights         $ 10,000                
Line of credit available amount       $ 50,000                  
Dream Homes, Ltd [Member]                          
Real Estate [Line Items]                          
Purchase of undeveloped land | a   7.5                      
Payments to acquire land             $ 2,166,710            
Refundable deposit             $ 25,000            
Development approval costs                   100,000      
Constructed property retail value                   2,430,000      
Restricted shares of common stock committed but not issued as of April 16, 2018 | shares   162,200                      
Deposits                   $ 25,000      
XML 31 R20.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Significant Accounting Policies (Policies)
9 Months Ended
Sep. 30, 2019
Accounting Policies [Abstract]  
Nature of Operations

Nature of Operations

 

Dream Homes & Development Corporation is a regional builder and developer of new single-family homes and subdivisions, as well as a market leader in coastal construction, elevation and mitigation. In the five years that have passed since Superstorm Sandy flooded 30,000 owner-occupied homes, Dream Homes has helped hundreds of homeowners to rebuild or raise their homes to comply with new FEMA requirements.

 

In addition to the coastal construction market, Dream Homes will continue to pursue opportunities in new single and multi-family home construction, with 4 new developments totaling 123 units under contract and in development. Dream Homes’ operations will include the development and sale of a variety of residential communities, including construction of semi-custom homes, entry-level and first time move-up single-family and multi-family homes.

 

In addition to the New Jersey market, the Company, through its Dream Building LLC subsidiary, has become licensed in Florida to pursue recent opportunities for elevation, restoration, renovation and new construction brought about by the damage caused by recent hurricanes. Initial markets to be targeted are located primarily in the southwest portion of the state, between Naples and Cape Coral.

 

In addition to the Company’s construction operations, the Company holds a bi-monthly “Dream Homes Nearly Famous Rebuilding Seminar”, and publishes an informational blog known as the “Dream Homes Rebuilding Blog”. The Rebuilding Seminar is an educational tool for homeowners who need rebuilding or renovations. This seminar has been presented steadily since early 2013, and is designed to educate and assist homeowners in deciphering the confusion about planning and executing complex residential construction projects. A professional team attends each seminar and presents on a diverse variety of topics, including expert advice from architects, engineers, finance people, attorneys, project managers, elevation professionals and builder/general contractors. The “Dream Homes Rebuilding Blog” is an educational platform written by Vincent Simonelli, which offers comprehensive advice on all aspects of construction, finance, development and real estate. The Blog is located at http://blog.dreamhomesltd.com.

 

History

 

Dream Homes & Development Corporation was originally incorporated as The Virtual Learning Company, Inc. (“Virtual Learning”) on January 6, 2009 as a Nevada corporation with 75,000,000 shares of capital stock authorized, of which 70,000,000 shares are common shares ($.001 par value), and 5,000,000 shares are preferred shares ($.001 par value).

 

On August 19, 2016, Virtual Learning acquired 4.5% of Dream Homes, Ltd. (“DHL”), 100% of Dream Building, LLC (“DBL”) , a wholly owned subsidiary of DHL, and use of all construction licensing and registrations held by Atlantic Northeast Construction LLC (“ANCL”), a wholly owned subsidiary of DHL, in exchange for the issuance of 2,225,000 shares of Virtual Learning common stock to DHL at an agreed price of $.05 per common share.

 

The majority stockholder and chief executive officer of DHL was also the controlling stockholder and chief executive officer of Virtual Learning. As Virtual Learning and DHL were entities under common control, the acquired assets were reflected by Virtual Learning at DHL’s $0 carrying amount on the date of transfer pursuant to Accounting Standards Codification (“ASC”) 805-50-30-5.

 

From August 19, 2016 to August 23, 2016, Virtual Learning acquired the rights to complete 6 in process construction contracts of ANCL in exchange for the issuance of 2,287,367 shares of Virtual Learning common stock to DHL at an agreed price of $.05 per common share for those ANCL contracts. As Virtual Learning and DHL were entities under common control, the acquired rights were reflected at DHL’s $0 carrying amount on the date of transfer pursuant to ASC 805-50-30-5.

 

Due to the Company’s change in focus to its construction business, the Company wrote off the remaining unamortized capitalized curriculum development costs of $20,534 at December 31, 2016.

 

On March 14, 2017, Virtual Learning changed its name to Dream Homes & Development Corporation (“DHDC”). DHDC maintains a web site at www.dreamhomesltd.com as well as a blog, located at http://blog.dreamhomesltd.com.

Interim Financial Statements

Interim Financial Statements

 

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they may not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations or cash flows. It is management’s opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation.

 

The unaudited interim financial statements should be read in conjunction with the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2018, which contains the financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Conditions and Results of Operations, for the year ended December 31, 2018. Operating results for the nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019.

Principles of Consolidation

Principles of Consolidation

 

The consolidated financial statements include the accounts of DHDC and its wholly owned subsidiary DBL (collectively, the “Company”). All intercompany balances and transactions have been eliminated in consolidation.

Property and Equipment

Property and Equipment

 

Property and equipment is stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over an estimated useful life of five years. Repairs and maintenance costs are expensed as incurred, and renewals and betterments are capitalized.

Use of Estimates

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

 

Fair value is defined as the price that we would receive to sell an asset or pay to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date. In determining fair value, GAAP establishes a three-level hierarchy used in measuring fair value, as follows:

 

● Level 1 inputs are quoted prices available for identical assets and liabilities in active markets.

 

● Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets and liabilities in active markets or other inputs that are observable or can be corroborated by observable market data.

 

● Level 3 inputs are less observable and reflect our own assumptions.

 

Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and loans payable to related parties. The carrying amount of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, and loans payable to related parties approximates fair value because of their short maturities.

Construction Contracts

Construction Contracts

 

Revenue recognition:

 

The Company recognizes construction contract revenue using the percentage-of-completion method, based primarily on contract cost incurred to date compared to total estimated contract cost. Cost of revenue includes an allocation of depreciation, amortization and general overhead cost. Changes to total estimated contract cost or losses, if any, are recognized in the period in which they are determined.

 

The Company generally provides limited warranties for work performed under its construction contracts with periods typically extending for a limited duration following substantial completion of the Company’s work on a project.

 

The Company classifies construction-related receivables and payables that may be settled in periods exceeding one year from the balance sheet date, if any, as current assets and liabilities consistent with the length of time of its project operating cycle. For example:

 

  Costs and estimated earnings in excess of billings represent the excess of contract costs and profits (or contract revenue) over the amount of contract billings to date and are classified as a current asset.
     
  Billings in excess of costs and estimated earnings represent the excess of contract billings to date over the amount of contract costs and profits (or contract revenue) recognized to date and are classified as a current liability.

 

Costs and estimated earnings in excess of billings result when either: 1) costs are incurred related to certain claims and unapproved change orders, or 2) the appropriate contract revenue amount has been recognized in accordance with the percentage-of-completion accounting method, but a portion of the revenue recorded cannot be billed currently due to the billing terms defined in the contract. Claims occur when there is a dispute regarding both a change in the scope of work and the price associated with that change. Unapproved change orders occur when there is a dispute regarding only the price associated with a change in scope of work. For both claims and unapproved change orders, the Company recognizes revenue, but not profit, when it is determined that recovery of incurred cost is probable and the amounts can be reliably estimated.

 

Change in Estimates:

 

The Company’s estimates of contract revenue and cost are highly detailed and many factors change during a contract performance period that result in a change to contract profitability. These factors include, but are not limited to, differing site conditions: availability of skilled contract labor: performance of major material suppliers and subcontractors: on-going subcontractor negotiations and buyout provisions: unusual weather conditions: changes in the timing of scheduled work: change orders: accuracy of the original bid estimate: changes in estimated labor productivity and costs based on experience to date: achievement of incentive-based income targets: and the expected, or actual, resolution terms for claims. The factors that cause changes in estimates vary depending on the maturation of the project within its lifecycle. For example, in the ramp-up phase, these factors typically consist of revisions in anticipated project costs and during the peak and close-out phases, these factors include the impact of change orders and claims as well as additional revisions in remaining anticipated project costs. Generally, if the contract is at an early stage of completion, the current period impact is smaller than if the same change in estimate is made to the contract at a later stage of completion. Management focuses on evaluating the performance of contracts individually and uses the cumulative catch-up method to account for revisions in estimates. Material changes in estimates are disclosed in the notes to the consolidated financial statements.

Income Taxes

Income Taxes

 

The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the provision for income tax in the statements of operations. The Company evaluates the probability of realizing the future benefits of its deferred tax assets and provides a valuation allowance when realization of the assets is not reasonably assured.

 

The Company recognizes in its financial statements the impact of tax positions that meet a “more likely than not” threshold, based on the technical merits of the position. The tax benefits recognized from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement.

Net Income (Loss) Per Common Share

Net Income (Loss) Per Common Share

 

Basic net income (basic net loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period.

 

Diluted net income (loss) per common share is computed using the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

 

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Accounting Standards Codification “ASC” Topic 606). The purpose of this ASU is to converge revenue recognition requirements per GAAP and International Financial Reporting Standards (“IFRS”). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments in this ASU were originally effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption not permitted by the FASB; however, in August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date after public comment respondents supported a proposal to delay the effective date of this ASU to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. We adopted this ASU on January 1, 2018 and adoption of this ASU did not have a material impact on our financial position, results of operations and cash flows.

 

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” and subsequent amendments to the initial guidance: ASU 2017-13, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01 (collectively, “Topic 842”), which provides guidance for accounting for leases. Topic 842 requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on an effective interest rate method or on a straight-line basis over the term of the lease. We are currently evaluating both the method and the impact of adopting this guidance on our Condensed Consolidated Financial Statements.

 

Certain other accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. The impact on the Company’s financial position and results of operations from adoption of these standards is not expected to be material.

XML 32 R24.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Income Taxes (Tables)
9 Months Ended
Sep. 30, 2019
Income Tax Disclosure [Abstract]  
Schedule of States Federal Income Tax Rate Income Loss Before Income Taxes

The sources of the differences follow:

 

   

Nine months

ended

September 30, 2019

   

Nine months

ended

September 30, 2018

 
Expected tax (benefit)   $ (12,496 )   $ (9,852 )
State income taxes, net of Federal (benefit)     (5,298 )     (2,816 )
Non-deductible stock-based compensation     33,000       14,275  
Change in valuation allowance     -       (1,607 )
Provision for income taxes   $ 15,206     $ -  

Schedule of Deferred Tax Assets

The significant components of DHDC’s deferred tax asset as of September 30, 2019 and December 31, 2018 are as follows:

 

      September 30, 2019       December 31,2018  
                 
Deferred tax assets:                
Net operating loss carry forward   $ -     $ 57,598  
Valuation allowance     -       (57,598 )
Net deferred tax asset   $ -     $ -  

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Consolidated Statements of Operations (Unaudited) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Revenue:        
Total revenue $ 551,770 $ 627,980 $ 2,095,417 $ 1,927,457
Cost of construction contracts 382,944 472,593 1,399,922 1,179,785
Gross profit 168,826 155,387 695,495 747,672
Operating Expenses:        
Selling, general and administrative, including stock based compensation of $ 110,194 and $ 86,774 , $0 and $ 18,798, respectively 201,902 98,344 760,954 700,535
Depreciation expense 1,653 1,228 4,576 3,684
Total operating expenses 203,555 99,572 765,530 704,219
Income (loss) from operations (34,729) 55,815 (70,035) 43,453
Other expenses (income):        
Cancellation of debt (12,000)
Interest expense 1,470
Total other expenses (income) (10,530)
Net income (loss) before income taxes (34,729) 55,815 (59,505) 43,453
Provision for income tax (expense) 10,420 (15,206)
Net income (loss) $ (24,309) $ 55,815 $ (74,711) $ 43,453
Basic and diluted income (loss) per common share $ 0.00 $ 0.01 $ (0.00) $ 0.00
Weighted average common shares outstanding-basic and diluted 25,878,993 24,200,953 24,915,346 24,200,953
Construction Contracts [Member]        
Revenue:        
Total revenue $ 551,770 $ 627,980 $ 2,095,417 $ 1,927,457

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Significant Accounting Policies
9 Months Ended
Sep. 30, 2019
Accounting Policies [Abstract]  
Significant Accounting Policies

Note 1 - Significant Accounting Policies

 

Nature of Operations

 

Dream Homes & Development Corporation is a regional builder and developer of new single-family homes and subdivisions, as well as a market leader in coastal construction, elevation and mitigation. In the five years that have passed since Superstorm Sandy flooded 30,000 owner-occupied homes, Dream Homes has helped hundreds of homeowners to rebuild or raise their homes to comply with new FEMA requirements.

 

In addition to the coastal construction market, Dream Homes will continue to pursue opportunities in new single and multi-family home construction, with 4 new developments totaling 123 units under contract and in development. Dream Homes’ operations will include the development and sale of a variety of residential communities, including construction of semi-custom homes, entry-level and first time move-up single-family and multi-family homes.

 

In addition to the New Jersey market, the Company, through its Dream Building LLC subsidiary, has become licensed in Florida to pursue recent opportunities for elevation, restoration, renovation and new construction brought about by the damage caused by recent hurricanes. Initial markets to be targeted are located primarily in the southwest portion of the state, between Naples and Cape Coral.

 

In addition to the Company’s construction operations, the Company holds a bi-monthly “Dream Homes Nearly Famous Rebuilding Seminar”, and publishes an informational blog known as the “Dream Homes Rebuilding Blog”. The Rebuilding Seminar is an educational tool for homeowners who need rebuilding or renovations. This seminar has been presented steadily since early 2013, and is designed to educate and assist homeowners in deciphering the confusion about planning and executing complex residential construction projects. A professional team attends each seminar and presents on a diverse variety of topics, including expert advice from architects, engineers, finance people, attorneys, project managers, elevation professionals and builder/general contractors. The “Dream Homes Rebuilding Blog” is an educational platform written by Vincent Simonelli, which offers comprehensive advice on all aspects of construction, finance, development and real estate. The Blog is located at http://blog.dreamhomesltd.com.

 

History

 

Dream Homes & Development Corporation was originally incorporated as The Virtual Learning Company, Inc. (“Virtual Learning”) on January 6, 2009 as a Nevada corporation with 75,000,000 shares of capital stock authorized, of which 70,000,000 shares are common shares ($.001 par value), and 5,000,000 shares are preferred shares ($.001 par value).

 

On August 19, 2016, Virtual Learning acquired 4.5% of Dream Homes, Ltd. (“DHL”), 100% of Dream Building, LLC (“DBL”) , a wholly owned subsidiary of DHL, and use of all construction licensing and registrations held by Atlantic Northeast Construction LLC (“ANCL”), a wholly owned subsidiary of DHL, in exchange for the issuance of 2,225,000 shares of Virtual Learning common stock to DHL at an agreed price of $.05 per common share.

 

The majority stockholder and chief executive officer of DHL was also the controlling stockholder and chief executive officer of Virtual Learning. As Virtual Learning and DHL were entities under common control, the acquired assets were reflected by Virtual Learning at DHL’s $0 carrying amount on the date of transfer pursuant to Accounting Standards Codification (“ASC”) 805-50-30-5.

 

From August 19, 2016 to August 23, 2016, Virtual Learning acquired the rights to complete 6 in process construction contracts of ANCL in exchange for the issuance of 2,287,367 shares of Virtual Learning common stock to DHL at an agreed price of $.05 per common share for those ANCL contracts. As Virtual Learning and DHL were entities under common control, the acquired rights were reflected at DHL’s $0 carrying amount on the date of transfer pursuant to ASC 805-50-30-5.

 

Due to the Company’s change in focus to its construction business, the Company wrote off the remaining unamortized capitalized curriculum development costs of $20,534 at December 31, 2016.

 

On March 14, 2017, Virtual Learning changed its name to Dream Homes & Development Corporation (“DHDC”). DHDC maintains a web site at www.dreamhomesltd.com as well as a blog, located at http://blog.dreamhomesltd.com.

 

Interim Financial Statements

 

The accompanying unaudited financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America and the rules and regulations of the United States Securities and Exchange Commission for interim financial information and with the instructions to Form 10-Q and Article 8 of Regulation S-X. Accordingly, they may not include all the information and footnotes necessary for a comprehensive presentation of financial position, results of operations or cash flows. It is management’s opinion, however, that all material adjustments (consisting of normal recurring adjustments) have been made which are necessary for a fair financial statement presentation.

 

The unaudited interim financial statements should be read in conjunction with the Company’s Annual Report filed on Form 10-K for the year ended December 31, 2018, which contains the financial statements and notes thereto, together with Management’s Discussion and Analysis of Financial Conditions and Results of Operations, for the year ended December 31, 2018. Operating results for the nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for the year ending December 31, 2019.

 

Principles of Consolidation

 

The consolidated financial statements include the accounts of DHDC and its wholly owned subsidiary DBL (collectively, the “Company”). All intercompany balances and transactions have been eliminated in consolidation.

 

Property and Equipment

 

Property and equipment is stated at cost less accumulated depreciation. Depreciation is provided using the straight-line method over an estimated useful life of five years. Repairs and maintenance costs are expensed as incurred, and renewals and betterments are capitalized.

 

Use of Estimates

 

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported and disclosed in the financial statements and the accompanying notes. Actual results could differ materially from these estimates.

 

Fair Value of Financial Instruments

 

Fair value is defined as the price that we would receive to sell an asset or pay to transfer a liability (an exit price) in an orderly transaction between market participants on the measurement date. In determining fair value, GAAP establishes a three-level hierarchy used in measuring fair value, as follows:

 

● Level 1 inputs are quoted prices available for identical assets and liabilities in active markets.

 

● Level 2 inputs are observable for the asset or liability, either directly or indirectly, including quoted prices for similar assets and liabilities in active markets or other inputs that are observable or can be corroborated by observable market data.

 

● Level 3 inputs are less observable and reflect our own assumptions.

 

Our financial instruments consist of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses and loans payable to related parties. The carrying amount of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses, and loans payable to related parties approximates fair value because of their short maturities.

 

Construction Contracts

 

Revenue recognition:

 

The Company recognizes construction contract revenue using the percentage-of-completion method, based primarily on contract cost incurred to date compared to total estimated contract cost. Cost of revenue includes an allocation of depreciation, amortization and general overhead cost. Changes to total estimated contract cost or losses, if any, are recognized in the period in which they are determined.

 

The Company generally provides limited warranties for work performed under its construction contracts with periods typically extending for a limited duration following substantial completion of the Company’s work on a project.

 

The Company classifies construction-related receivables and payables that may be settled in periods exceeding one year from the balance sheet date, if any, as current assets and liabilities consistent with the length of time of its project operating cycle. For example:

 

  Costs and estimated earnings in excess of billings represent the excess of contract costs and profits (or contract revenue) over the amount of contract billings to date and are classified as a current asset.
     
  Billings in excess of costs and estimated earnings represent the excess of contract billings to date over the amount of contract costs and profits (or contract revenue) recognized to date and are classified as a current liability.

 

Costs and estimated earnings in excess of billings result when either: 1) costs are incurred related to certain claims and unapproved change orders, or 2) the appropriate contract revenue amount has been recognized in accordance with the percentage-of-completion accounting method, but a portion of the revenue recorded cannot be billed currently due to the billing terms defined in the contract. Claims occur when there is a dispute regarding both a change in the scope of work and the price associated with that change. Unapproved change orders occur when there is a dispute regarding only the price associated with a change in scope of work. For both claims and unapproved change orders, the Company recognizes revenue, but not profit, when it is determined that recovery of incurred cost is probable and the amounts can be reliably estimated.

 

Change in Estimates:

 

The Company’s estimates of contract revenue and cost are highly detailed and many factors change during a contract performance period that result in a change to contract profitability. These factors include, but are not limited to, differing site conditions: availability of skilled contract labor: performance of major material suppliers and subcontractors: on-going subcontractor negotiations and buyout provisions: unusual weather conditions: changes in the timing of scheduled work: change orders: accuracy of the original bid estimate: changes in estimated labor productivity and costs based on experience to date: achievement of incentive-based income targets: and the expected, or actual, resolution terms for claims. The factors that cause changes in estimates vary depending on the maturation of the project within its lifecycle. For example, in the ramp-up phase, these factors typically consist of revisions in anticipated project costs and during the peak and close-out phases, these factors include the impact of change orders and claims as well as additional revisions in remaining anticipated project costs. Generally, if the contract is at an early stage of completion, the current period impact is smaller than if the same change in estimate is made to the contract at a later stage of completion. Management focuses on evaluating the performance of contracts individually and uses the cumulative catch-up method to account for revisions in estimates. Material changes in estimates are disclosed in the notes to the consolidated financial statements.

 

Income Taxes

 

The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax reporting purposes. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the provision for income tax in the statements of operations. The Company evaluates the probability of realizing the future benefits of its deferred tax assets and provides a valuation allowance when realization of the assets is not reasonably assured.

 

The Company recognizes in its financial statements the impact of tax positions that meet a “more likely than not” threshold, based on the technical merits of the position. The tax benefits recognized from such a position are measured based on the largest benefit that has a greater than fifty percent likelihood of being realized upon ultimate settlement.

 

Net Income (Loss) Per Common Share

 

Basic net income (basic net loss) per common share is calculated by dividing net income (loss) by the weighted average number of common shares outstanding during the period.

 

Diluted net income (loss) per common share is computed using the weighted average number of common shares outstanding and potentially dilutive securities outstanding during the period.

 

Recent Accounting Pronouncements

 

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, Revenue from Contracts with Customers (Accounting Standards Codification “ASC” Topic 606). The purpose of this ASU is to converge revenue recognition requirements per GAAP and International Financial Reporting Standards (“IFRS”). The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. The amendments in this ASU were originally effective for interim and annual reporting periods beginning after December 15, 2016, with early adoption not permitted by the FASB; however, in August 2015, the FASB issued ASU 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date after public comment respondents supported a proposal to delay the effective date of this ASU to annual reporting periods beginning after December 15, 2017, including interim reporting periods within that reporting period. We adopted this ASU on January 1, 2018 and adoption of this ASU did not have a material impact on our financial position, results of operations and cash flows.

 

In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” and subsequent amendments to the initial guidance: ASU 2017-13, ASU 2018-10, ASU 2018-11, ASU 2018-20 and ASU 2019-01 (collectively, “Topic 842”), which provides guidance for accounting for leases. Topic 842 requires lessees to classify leases as either finance or operating leases and to record a right-of-use asset and a lease liability for all leases with a term greater than 12 months regardless of the lease classification. The lease classification will determine whether the lease expense is recognized based on an effective interest rate method or on a straight-line basis over the term of the lease. We are currently evaluating both the method and the impact of adopting this guidance on our Condensed Consolidated Financial Statements.

 

Certain other accounting pronouncements have been issued by the FASB and other standard setting organizations which are not yet effective and therefore have not yet been adopted by the Company. The impact on the Company’s financial position and results of operations from adoption of these standards is not expected to be material.

XML 37 R35.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Business Segments (Details Narrative)
9 Months Ended
Sep. 30, 2019
Integer
Segment Reporting [Abstract]  
Number of business segments 1
XML 38 R31.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Common Stock Issuances (Details Narrative) - USD ($)
1 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended
Jun. 06, 2019
May 09, 2019
Feb. 26, 2018
Feb. 09, 2018
Jan. 31, 2018
Dec. 29, 2017
Dec. 27, 2017
Dec. 11, 2017
Dec. 08, 2017
Sep. 21, 2017
Jul. 12, 2017
Apr. 26, 2017
Apr. 24, 2017
Mar. 14, 2017
Feb. 22, 2017
Oct. 13, 2016
Apr. 30, 2017
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Dec. 31, 2011
Dec. 31, 2010
Common stock per share $ .10         $ 0.40                                  
Number of restricted common stock shares issued for settlement of accounts payable           27,810                                  
Number of restricted common stock issued for settlement of accounts payable           $ 11,124                                  
Stock based compensation                                   $ 0 $ 18,798 $ 110,194 $ 86,774    
Proceeds from issuance of common stock                                       $ 11,400    
Number of restricted common stock shares issued for reduction of note payable 100,000                                            
Secretary [Member]                                              
Number of common shares issued for legal services       25,000                                      
Stock based compensation                                            
Directors [Member]                                              
Number of common shares issued for legal services       25,000                                      
Stock based compensation                                            
Two Individuals [Member]                                              
Common stock per share   $ .08                                          
Number of restricted common stock shares issued for consulting services   58,000                                          
Six Individuals [Member]                                              
Common stock per share $ .10                                            
Number of restricted common stock shares issued for stock-based compensation 520,000                                            
Chief Executive Officer [Member]                                              
Common stock per share $ .10                                            
Number of restricted common stock shares issued for debt reduction 1,000,000                                            
DHL [Member]                                              
Number of restricted common stock shares issued during the period               100,000 162,200 25,000     71,429 275,000                  
Stock issued during the period restricted stock value                 $ 48,658       $ 10,000                    
Number of restricted common stock shares issued to exchange for vehicles                     40,000                        
Number of restricted common stock issued to exchange for vehicles                     $ 6,000                        
Number of common shares issued for legal services       40,000                                      
Stock based compensation                                          
General Development Corp [Member]                                              
Number of restricted common stock shares issued during the period                       100,000         100,000            
Stock issued during the period restricted stock value                                 $ 5,000            
Subscription Agreement [Member]                                              
Common stock per share     $ 0.40   $ 0.40   $ 0.40                                
Number of restricted common stock shares issued for cash for subscription agreement         16,000   12,500                                
Number of restricted common stock issued for cash for subscription agreement         $ 11,400   $ 5,000                                
Number of common shares issued for legal services     12,500                                        
Proceeds from issuance of common stock     $ 5,000                                        
Green Chip Investor Relations [Member] | Consulting Services Agreement [Member]                                              
Number of restricted common stock shares issued during the period                             56,000                
Stock issued during the period restricted stock value                             $ 2,800                
Common stock per share                             $ 0.05                
Minority Stockholder [Member]                                              
Number of common shares issued for legal services                                           30,000  
Minority interest                                             $ 10,000
Minority Stockholder [Member] | Private Placement [Member]                                              
Minority interest                                             $ 500,000
Minority Stockholder [Member] | DHL [Member]                                              
Number of restricted common stock shares issued during the period                               100,000              
XML 39 R39.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Receivable from Arbitration and Settlement of in Process Customer Construction Contract in Dispute and Related Losses Recognized and Recorded by the Company (Details Narrative) - USD ($)
1 Months Ended 3 Months Ended 9 Months Ended 12 Months Ended
Mar. 06, 2018
Sep. 30, 2017
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Dec. 31, 2017
Aug. 31, 2016
Cumulative gross profit     $ 168,826 $ 155,387 $ 695,495 $ 747,672    
American Arbitration Association [Member]                
Payment from customer for contract dispute $ 75,000              
Recognized loss on write-down of accounts receivable             $ 14,318  
Recognized loss on costs and estimated earnings in excess of billings             48,419  
Arbitration Award [Member] | American Arbitration Association [Member]                
Amount billed to customer             219,565  
Contract receivable claims amount $ 75,000           48,419  
Costs and estimated earnings             267,984  
Cumulative gross profit             17,658  
Negative gross profit             (9,012)  
Contract loss             $ 62,732  
Construction Contracts [Member]                
Contracts receivable               $ 307,000
Amount billed to customer   $ 219,565            
Due from customer   89,318            
Construction Contracts [Member] | Customer [Member]                
Proceeds from contracts   $ 130,247            
XML 40 R12.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Common Stock Issuances
9 Months Ended
Sep. 30, 2019
Equity [Abstract]  
Common Stock Issuances

5 - Common Stock Issuances

 

On February 22, 2017, DHDC issued 56,000 restricted shares of common stock to Green Chip Investor Relations pursuant to an Investor Relations and Consulting Services Agreement (see Note 8). The 56,000 restricted shares were valued at $2,800 (or $.05 per share), which amount was expensed in the three months ended March 31, 2017.

 

On March 1, 2017, DHDC committed to issue 71,429 restricted shares of common stock (issued April 24, 2017) to DHL valued at $10,000, representing the amount of the refundable deposit on land made by DHL to the Seller in January 2017 for the Berkeley Township New Jersey contract (see Note 3).

 

On March 14, 2017, DHL assigned 275,000 restricted shares of Company common stock it held to the same minority stockholder of DHL that it assigned 100,000 shares of Company common stock on October 13, 2016 (see sixth preceding paragraph).

 

On April 26, 2017, DHDC issued 100,000 shares of restricted stock to General Development Corp. as payment of an assignment fee related to the 58-unit townhouse development in Lacey Township, NJ (see Note 3).

 

On July 12, 2017, DHDC issued 40,000 restricted shares of DHDC’s common stock to Dream Homes, Ltd. (“DHL”) in exchange for vehicles owned by DHL. The transaction reflected $6,000 net carrying value of the assets on DHL’s books at July 12, 2017.

 

On September 21, 2017, DHL assigned 25,000 restricted shares of Company common stock it held to the Secretary of both DHDC and DHL for services rendered to DHL. Accordingly, no stock-based compensation was recognized by DHDC.

  

On December 8, 2017, DHDC committed to issue 162,200 restricted shares of common stock to DHL valued at $48,658 (DHL’s historical cost of the assets being assigned), for the assignment of a contract to purchase property from DHL for the Lacey Township New Jersey contract (see Note 3).

 

On December 11, 2017, DHL assigned 100,000 restricted shares of Company common stock it held to the Company Securities Counsel of both DHDC and DHL in settlement of certain DHL accounts payable due him. Accordingly, no stock-based compensation was recognized by DHDC.

 

On December 27, 2017, DHDC committed to issue 12,500 restricted shares of DHDC’s common stock for cash proceeds of $ 5,000 at $.40 per share per the Subscription Agreement.

 

On December 29, 2017, DHDC committed to issue 27,810 restricted shares of DHDC’s common stock for settlement of $ 11,124 accounts payable at $.40 per share.

 

On January 31, 2018, DHDC committed to issue 16,000 restricted shares of DHDC’s common stock for cash proceeds of $11,400 at $ .40 per share per the subscription agreement.

 

On February 9, 2018, DHL assigned 40,000 restricted shares of Company common stock it held to a minority stockholder of DHL. This minority stockholder of DHL had contributed $10,000 out of approximately $500,000 in a private placement of common stock of DHL in 2010. In addition, this minority stockholder of DHL also received 30,000 restricted shares of DHL common stock in 2011 for legal services. Accordingly, no stock-based compensation was recognized by DHDC for this assignment of 40,000 shares.

 

On February 9, 2018, DHL assigned 25,000 restricted shares of Company common stock it held to the Secretary of both DHDC and DHL for accounting and administrative services rendered to DHL. Accordingly, no stock-based compensation was recognized by DHDC for this assignment of 25,000 shares.

 

On February 9, 2018, DHL assigned 25,000 restricted shares of Company common stock it held to a director of DHDC and service provider to DHL for legal services provided to DHL. Accordingly, no stock-based compensation was recognized by DHDC for this assignment of 25,000 shares.

 

On February 26, 2018 DHDC issued 12,500 restricted shares of DHDC’s common stock for cash proceeds of $ 5,000 at $.40 per share per the Subscription Agreement.

 

On May 9, 2019, the Company issued 58,000 restricted shares of restricted common shares to two individuals for consulting services at $.08 per share.

 

On June 6, 2019, the Company issued 520,000 restricted shares for stock-based compensation at $.10 per share to six individuals.

 

On June 6, 2019, the Company issued 1,000,000 restricted shares for debt reduction to the Chief Executive Officer at $.10 per share.

 

On June 6, 2019, the Company issued 100,000 restricted shares for reduction of note payable at $.10 per share.

XML 41 R16.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Related Party Transactions
9 Months Ended
Sep. 30, 2019
Related Party Transactions [Abstract]  
Related Party Transactions

9- Related Party Transactions

 

Dream Homes Ltd. Allocated payroll

 

The Company uses the services of Dream Homes Ltd. (DHL) personnel for its operations. For the nine months ended September 30, 2019 and 2018, selling, general and administrative expenses include $277,949.00 and $280,122.46, respectively. Costs incurred for the Company’s estimated share of DHL’s gross payroll and payroll taxes for the 2019 nine-month period include $57,000 salary paid to the Company’s Chief Executive Officer and $40,800 salary paid to the Company’s Secretary and VP of Human Resources.

 

Office Space

 

The Company has occupied office space located in Forked River, New Jersey which is owned by an affiliated company. Commencing April 2017, the Company has paid DHL monthly rent of $2,000 ($18,000 total for the nine months ended September 30, 2019) for this office space.

XML 42 R9.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Property and Equipment
9 Months Ended
Sep. 30, 2019
Property, Plant and Equipment [Abstract]  
Property and Equipment

2 - Property and Equipment

 

Property and equipment is summarized as follows:

 

    September 30, 2019     December 31, 2018  
             
Office equipment   $ 4,115     $ 4,115  
Vehicles/Modular office     59,065       31,065  
Less: Accumulated depreciation     (29,026 )     (24,449 )
                 
Property and Equipment- net   $ 34,154     $ 10,731  

 

Depreciation expense for the nine months ended September 30, 2019 and 2018 was $4,576 and $3,684, respectively.

XML 43 R5.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Consolidated Statements of Operations (Unaudited) (Parenthetical) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Income Statement [Abstract]        
Stock based compensation $ 0 $ 18,798 $ 110,194 $ 86,774
XML 44 R1.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Document and Entity Information - shares
9 Months Ended
Sep. 30, 2019
Dec. 10, 2019
Document And Entity Information    
Entity Registrant Name Dream Homes & Development Corp.  
Entity Central Index Key 0001518336  
Document Type 10-Q  
Document Period End Date Sep. 30, 2019  
Amendment Flag false  
Current Fiscal Year End Date --12-31  
Entity Current Reporting Status No  
Entity Interactive Data Current No  
Entity Filer Category Non-accelerated Filer  
Entity Small Business Flag true  
Entity Emerging Growth Company false  
Entity Ex Transition Period false  
Entity Shell Company false  
Entity Common Stock, Shares Outstanding   25,878,993
Document Fiscal Period Focus Q3  
Document Fiscal Year Focus 2019  
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Stock Warrants (Details Narrative)
3 Months Ended 9 Months Ended 12 Months Ended
Feb. 09, 2018
USD ($)
Jul. 12, 2017
USD ($)
$ / shares
shares
Sep. 30, 2019
USD ($)
Mar. 31, 2019
USD ($)
Sep. 30, 2018
USD ($)
Mar. 31, 2018
USD ($)
Sep. 30, 2019
USD ($)
Sep. 30, 2018
USD ($)
Dec. 31, 2018
USD ($)
shares
May 08, 2017
shares
Stock based compensation | $     $ 0   $ 18,798   $ 110,194 $ 86,774    
Secretary [Member]                    
Stock based compensation | $                  
Stock Warrant [Member]                    
Stock warrants issued   750,000                
Fair value of warrants | $   $ 407,850                
Requisite service period   3 years                
Stock Warrant [Member] | Exercise Price [Member]                    
Warrants, measurement input | $ / shares   0.60                
Stock Warrant [Member] | Stock Price [Member]                    
Warrants per share | $ / shares   $ 0.30                
Stock Warrant [Member] | Dividend Yield [Member]                    
Warrants, measurement input   0.00                
Stock Warrant [Member] | Risk-Free Interest Rate [Member]                    
Warrants, measurement input   1.53                
Stock Warrant [Member] | Expected Volatility [Member]                    
Warrants, measurement input   171                
Stock Warrant [Member] | Expected Term [Member]                    
Warrants, term   3 years                
Stock Warrant [Member] | Through July 20, 2020 [Member]                    
Warrants per share | $ / shares   $ 0.30                
Stock Warrant [Member] | Chief Executive Officer [Member]                    
Stock warrants issued   500,000                
Stock Warrant [Member] | Secretary [Member]                    
Stock warrants issued   100,000                
Stock Warrant [Member] | Two Other Directors [Member]                    
Stock warrants issued   60,000                
Stock Warrant [Member] | Non Executive DHL Project Manager Employee [Member]                    
Stock warrants issued   50,000                
Stock Warrant [Member] | Vice President of Business Development [Member]                    
Warrants, cancelled                 20,000  
Stock Warrant [Member] | Sales Manager [Member]                    
Stock warrants issued                   20,000
Warrant [Member]                    
Stock based compensation | $       $ 30,394   $ 33,988     $ 117,844  
XML 47 R34.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Income Taxes - Schedule of Deferred Tax Assets (Details) - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Income Tax Disclosure [Abstract]    
Net operating loss carry forward $ 57,598
Valuation allowance (57,598)
Net deferred tax asset
XML 48 R30.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Loans Payable to Related Parties - Schedule of Loans Payable to Related Parties (Details) - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Net total $ 54,352 $ 52,243
Loans Payable to Chief Executive Officer [Member] | Loans Payable [Member]    
Net total 70,634 29,025
Loans Payable to GPIL [Member] | Loans Payable [Member]    
Net total 3,118 3,118
Loan Payable to DHL [Member] | Loans Payable [Member]    
Net total $ (19,400) $ 20,100
XML 49 R13.htm IDEA: XBRL DOCUMENT v3.19.3.a.u2
Income Taxes
9 Months Ended
Sep. 30, 2019
Income Tax Disclosure [Abstract]  
Income Taxes

6 – Income Taxes

 

The provisions for (benefit from) income taxes differ from the amounts computed by applying the statutory United States Federal income tax rate (21% in 2019 and 2018) to income (loss) before income taxes.

 

The sources of the differences follow:

 

   

Nine months

ended

September 30, 2019

   

Nine months

ended

September 30, 2018

 
Expected tax (benefit)   $ (12,496 )   $ (9,852 )
State income taxes, net of Federal (benefit)     (5,298 )     (2,816 )
Non-deductible stock-based compensation     33,000       14,275  
Change in valuation allowance     -       (1,607 )
Provision for income taxes   $ 15,206     $ -  

 

The significant components of DHDC’s deferred tax asset as of September 30, 2019 and December 31, 2018 are as follows:

 

      September 30, 2019       December 31,2018  
                 
Deferred tax assets:                
Net operating loss carry forward   $ -     $ 57,598  
Valuation allowance     -       (57,598 )
Net deferred tax asset   $ -     $ -  

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Stock Warrants
9 Months Ended
Sep. 30, 2019
Equity [Abstract]  
Stock Warrants

10- Stock Warrants

 

On July 12, 2017, DHDC issued 750,000 stock warrants to various members of Dream Homes & Development Corporation’s executive team (including 500,000 to the Company’s Chief Executive Officer, 100,000 to the Company’s Secretary, and a total of 60,000 to the Company’s two other directors and 50,000 to a non-executive DHL project manager employee). These Warrants entitle the holder to purchase shares of Dream Homes & Development Corporation at $0.30 per share through July 20, 2020. These warrants vest to the Holder on a semi-annual basis over a 36-month period contingent upon Holder’s continued association with the Company. The $407,850 total fair value (calculated using the Black Scholes option pricing model and the following assumptions: (1) stock price of $0.60, (2) exercise price of $0.30, (3) dividend yield of 0%, (4) risk-free interest rate of 1.53%, (5) expected volatility of 171%, and (6) term of 3 years) of the 750,000 warrants is being expensed evenly over the 3 years requisite service period of the individuals that were granted these warrants commencing in July 2017. For the three months ended March 31, 2019 and 2018, stock-based compensation attributable to the warrants was $30,394 and $33,988, respectively, using the above Black Scholes option pricing model. For the year ended December 31, 2018, stock-based compensation attributable to the warrants was $ 117,844 using the above Black Scholes option pricing model.

 

Included within the 750,000 warrants described in the preceding paragraph are 20,000 warrants issued to the Company’s Vice President of Business Development that are not covered by the Employment Agreement dated April 28, 2017 described in Note 8. These warrants have been cancelled since this individual is no longer with the Company as of 12/31/18. Also included within the 750,000 warrants described in the preceding paragraph are 20,000 warrants issued to the Company’s Sales Manager that are not covered by the Employment Agreement dated May 8, 2017 described in Note 8.

 

Effective April 1, 2020, all remaining warrants were cancelled.

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Property and Equipment (Tables)
9 Months Ended
Sep. 30, 2019
Property, Plant and Equipment [Abstract]  
Schedule of Property and Equipment

Property and equipment is summarized as follows:

 

    September 30, 2019     December 31, 2018  
             
Office equipment   $ 4,115     $ 4,115  
Vehicles/Modular office     59,065       31,065  
Less: Accumulated depreciation     (29,026 )     (24,449 )
                 
Property and Equipment- net   $ 34,154     $ 10,731  

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Significant Accounting Policies (Details Narrative) - USD ($)
9 Months Ended
Aug. 23, 2016
Aug. 19, 2016
Sep. 30, 2019
Dec. 31, 2018
Dec. 31, 2016
Jan. 06, 2009
Capital stock authorized           75,000,000
Common stock, shares authorized     70,000,000 70,000,000   70,000,000
Common stock, par value     $ .001 $ .001   $ 0.001
Preferred stock, shares authorized     5,000,000 5,000,000   5,000,000
Preferred stock, par value     $ .001 $ 0.001   $ 0.001
Capitalized curriculum development costs         $ 20,534  
Property and equipment, estimated useful life     5 years      
Dream Homes, Ltd [Member]            
Acquired ownership interest   4.50%        
Number of exchange shares for the issuance 2,287,367 2,225,000        
Agreed to common price per share $ 0.05 $ 0.05        
Acquired rights carrying amount $ 0 $ 0        
Dream Building, LLC [Member]            
Acquired ownership interest   100.00%        
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Deposits and Costs Coincident to Acquisition of Land for Development - Schedule of Deposits and Costs Coincident to Acquisition of Land for Development (Details) - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Total $ 575,482 $ 360,967
Lacey Township, New Jersey, Marina Contract [Member]    
Deposit 25,000 25,000
Site engineering, permits, and other costs 49,959 49,959
Total 74,959 74,959
Clayton - 120 Apartments [Member]    
Other deposits 54,467 9,920
71 Sheridan Avenue [Member]    
Other deposits 79,150 79,150
Bayville-17 Units [Member]    
Other deposits 30,949 2,674
Other [Member]    
Other deposits 7,726 2,005
Lacey Township, New Jersey, Pines Contract [Member]    
Deposit
Cost to acquire contract 10,000 10,000
Site engineering, permits, and other costs 109,265 109,265
Total 119,265 119,265
Berkeley Township, New Jersey, Tallwoods contract [Member]    
Deposit 10,000 10,000
Site engineering, permits, and other costs 86,442 62,994
Total 96,442 72,994
Louis Ave - Bayville 17 Units [Member]    
Total 30,949
Station Dr - Forked River [Member]    
Total 54,109
201 East Ave - Clayton - 77 Units [Member]    
Total 52,200
Academy St - Clayton - 2 Lots [Member]    
Total 3,199
Fairview Development - Clayton 120 Units [Member]    
Total 6,874
Lackland (Pines Contract) [Member]    
Total $ (65,532)
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Subsequent Events (Details Narrative)
1 Months Ended
Oct. 31, 2019
Subsequent Event [Member]  
Contract to acquire hometown description A contract was signed to acquire 70 approved townhome units in October 2019, after 31 months of discussion. A contract was signed to purchase 52 approved townhome units in Forked River, NJ.