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INVESTMENTS IN REAL ESTATE
 3 Months Ended
Sep. 30, 2024
INVESTMENTS IN REAL ESTATE [Abstract]  
INVESTMENTS IN REAL ESTATE
NOTE 3 – INVESTMENTS IN REAL ESTATE
 
The following tables provide summary information regarding our operating properties, which are owned through our subsidiaries. The ownership interest shown below is the percentage of the property owned by the subsidiary, not the percentage of the subsidiary owned by the Parent Company or the Operating Partnership.
 
Consolidated Operating Properties
 
Property Name:
  
Commodore Apartments
  
Pon de Leo Apartments
  
Hollywood Apartments
  
Shoreline Apartments
Property Owner:
  
Madison-PVT Partners LLC
  
PVT-Madison Partners LLC
  
PT Hillview GP, LLC
  
MacKenzie BAA IG Shoreline LLC
Location:
  
Oakland, CA
  
Oakland, CA
  
Hollywood, CA
  
Concord, CA
Number of Tenants:
   44  
38
  
52
  
71
Year Built:
   1912  
1929
  
1917
  
1968
Ownership Interest:
  
100%
  
100%
  
100%
  
100%
               
Property Name:
  
Satellite Place Office Building
  
First & Main Office Building
  
1300 Main Office Building
   Woodland Corporate Center
Property Owner:
  
MacKenzie Satellite Place Corp.
  
First & Main, LP
  
1300 Main, LP
   Woodland Corporate Center Two, LP
Location:
  
Duluth, GA
  
Napa, CA
  
Napa, CA
   Woodland, CA
Number of Tenants:
  
4
  
9
  
7
   14
Year Built:
  
2002
  
2001
  
2020
   2004
Ownership Interest:
  
100%
  
100%
  
100%
   100%
                 
Property Name:
  Main Street West Office Building   220 Campus Lane Office Building   Green Valley Executive Center   One Harbor Center
Property Owner:
  Main Street West, LP   220 Campus Lane, LLC   GV Executive Center, LLC   One Harbor Center, LP
Location:
  Napa, CA   Fairfield , CA   Fairfield , CA   Suisun,CA
Number of Tenants:
  8   4   17   13
Year Built:
  2007   1990   2006   2001
Ownership Interest:
  100%   100%   100%   100%
                 
Property Name:   Green Valley Medical Center            
Property Owner:   Green Valley Medical Center, LP            
Location:   Fairfield , CA            
Number of Tenants:   13            
Year Built:   2002            
Ownership Interest:   100%            

                
 
The following table presents the purchase price allocation of real estate asset acquired during the three months ended September 30, 2024 based on asset acquisition accounting.

Property Name:
   Green Valley Medical Center
  
Acquisition Date:
   August 1, 2024
  
Purchase Price Allocation
      
Land
  
$
1,582,517
  
Building
     9,469,081  
Site Improvements     705,581  
Tenant Improvements     518,070  
Lease In Place
     556,019  
Leasing Commissions     231,042  
Legal & Marketing Lease Up Costs
     90,214  
Solar Finance Lease     600,000  
Total assets acquired
     13,752,525  
         
Net leasehold liability    
(74,271
)
         
Total assets acquired, net   $ 13,678,254  

The total depreciation expense of our operating properties for the three months ended September 30, 2024 and 2023 were $1,581,524 and $1,129,775, respectively.

Operating Leases:
 
Our real estate assets are leased to tenants under operating leases that contain varying terms and expirations. The leases may have provisions to extend the lease agreements, options for early termination after paying a specified penalty and other terms and conditions as negotiated. We retain substantially all the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, we do not require a security deposit from tenants on our commercial real estate properties, depending upon the terms of the respective leases and the creditworthiness of the tenants. Even when required, security deposits generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of the security deposit. Security deposits received in cash related to tenant leases are included in other accrued liabilities in the accompanying consolidated balance sheets and were immaterial as of September 30, 2024 and June 30, 2024.

The following table presents the components of income from real estate operations for the three months ended September 30, 2024 and 2023:
 
   
Three Months Ended
    
Three Months Ended
  
   
September 30, 2024
    
September 30, 2023
  
             
Lease income - Operating leases
  
$
4,619,178
    
$
3,355,790
  
Variable lease income (1)
    
333,051
      
204,191
  
   
$
4,952,229
    
$
3,559,981
  


(1)
Primarily includes tenant reimbursements for utilities and common area maintenance.
 
As of September 30, 2024, the future minimum rental income from our real estate properties under non-cancelable operating leases are as follows:
 
Year ended June 30, :
  
Rental Income
  
2025
  
$
9,594,194
  
2026
    
10,020,489
  
2027
    
7,960,704
  
2028
    
6,755,787
  
2029
    
5,802,065
  
Thereafter
    
11,327,022
  
Total
  
$
51,460,261
  
 
Lease Intangibles, Above-Market Lease Assets and Below-Market Lease Liabilities, Net
 
As of September 30, 2024 and June 30, 2024, our acquired lease intangibles, above-market lease assets, and below-market lease liabilities were as follows:

   
As of September 30, 2024
  
   
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
                   
Cost
  
$
11,349,308
    
$
824,870
    
$
2,914,040
  
Accumulated amortization
    
(4,496,547
)
    
(286,485
)
    
(1,559,499
)
Total
  
$
6,852,761
    
$
538,385
    
$
1,354,541
  
                         
Weighted average amortization period (years)
     4.8
       4.6
       4.8
  

    As of June 30, 2024
  
   
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
                   
Cost
  
$
10,738,744
    
$
702,254
    
$
2,717,150
  
Accumulated amortization
    
(4,168,692
)
    
(226,628
)
    
(1,432,318
)
Total
  
$
6,570,052
    
$
475,626
    
$
1,284,832
  
                         
Weighted average amortization period (years)
     4.8
       4.6       4.8
  

Our amortization of lease intangibles, above-market lease assets and below-market lease liabilities for the three months ended September 30, 2024 and 2023, were as follows:


   
Three Months Ended September 30, 2024
  
   
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
Amortization
  
$
699,232
    
$
59,857
    
$
(127,181
)
 
   
Three Months Ended September 30, 2023
  
   
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
Amortization
  
$
429,893
    
$
29,426
    
$
(124,860
)

The following table provides the projected amortization expense and adjustments to revenue from tenants for intangible assets and liabilities for the next five years:
 
   
Year Ended June 30,
  
   
2025 (remainder)
    
2026
    
2027
    
2028
    
2029
     Thereafter
 
In-place leases, to be included in amortization
  
$
1,817,144
    
$
1,845,616
    
$
1,108,030
    
$
743,286
    
$
595,407
     $ 840,225  
                                                 
Above-market lease intangibles
   $
144,259
     $
137,574
     $
99,803
     $
53,296
     $
43,298
     $
60,155  
Below-market lease liabilities
    
(313,725
)
    
(354,995
)
    
(264,696
)
    
(177,823
)
    
(138,172
)
     (105,130 )

 
$
(169,466
)
  
$
(217,421
)
  
$
(164,893
)
  
$
(124,527
)
  
$
(94,874
)
   $ (44,975 )