As of December 31, 2019, the Company’s real estate portfolio was composed of two hotel properties, three office properties and one apartment building. In addition, as of December 31, 2019, the Company has entered into a consolidated joint venture to develop one office/retail property. The following table summarizes the Company’s real estate as of December 31, 2019 and 2018, respectively (in thousands):


	December 31, 2019		December 31, 2018
Land	$	102,288	$	104,138
Buildings and improvements	427,696		425,989
Tenant origination and absorption costs	15,422		17,183
Total real estate, cost and net of impairment charges ⁽¹⁾	545,406		547,310
Accumulated depreciation and amortization	(51,723)		(35,704)
Total real estate, net	$	493,683	$	511,606


Property	Date Acquired	City	State	Property Type	Land		Building and Improvements ⁽¹⁾		Tenant Origination and Absorption		Total Real Estate, at Cost and Net of Impairment Charges		Accumulated Depreciation and Amortization		Total Real Estate, Net		Ownership %
Springmaid Beach Resort	12/30/2014	Myrtle Beach	SC	Hotel	$	27,438	$	37,822	$	—	$	65,260	$	(10,314)	$	54,946	90.0%
Q&C Hotel	12/17/2015	New Orleans	LA	Hotel	1,232		53,233		—		54,465		(8,315)		46,150		90.0%
Lincoln Court	05/20/2016	Campbell	CA	Office	14,706		35,978		2,126		52,810		(5,641)		47,169		100.0%
Lofts at NoHo Commons	11/16/2016	North Hollywood	CA	Apartment	26,222		81,307		—		107,529		(6,576)		100,953		90.0%
210 West 31st Street⁽²⁾	12/01/2016	New York	NY	Retail	—		55,244		—		55,244		—		55,244		80.0%
Oakland City Center	08/18/2017	Oakland	CA	Office	22,150		142,102		10,496		174,748		(17,493)		157,255		100.0%
Madison Square ⁽³⁾	10/03/2017	Phoenix	AZ	Office	10,540		22,010		2,800		35,350		(3,384)		31,966		90.0%
					$	102,288	$	427,696	$	15,422	$	545,406	$	(51,723)	$	493,683

⁽²⁾ The Company acquired the rights to a leasehold interest with respect to this property, which was accounted for as a finance lease. The Company applied a 6.1% discount rate to the finance lease and the lease expires on January 31, 2114. As of December 31, 2019, the finance lease right-of-use asset had a carrying value of $6.8 million included in building and improvements. No depreciation or amortization was recorded to this property as of December 31, 2019.

⁽³⁾ The Company acquired the rights to a leasehold interest with respect to the land at this property, which was accounted for as a finance lease. The Company applied a 5.4% discount rate to the finance lease and as of December 31, 2019, the finance lease had a weighted average remaining lease term of 2.6 years. As of December 31, 2019, the capital lease asset had a carrying value of $1.9 million included in land. This property was formerly known as Grace Court and was re-named Madison Square in connection with the Company’s re-branding strategy for this property.


	For the Years Ended December 31,
	2019		2018		2017
Hotel revenues:
Room	$	23,513	$	24,620	$	17,216
Food, beverage and convention services	5,030		5,263		3,761
Campground	1,105		1,176		1,127
Other⁽¹⁾	1,733		1,607		6,890
Hotel revenues	$	31,381	$	32,666	$	28,994

Hotel expenses:
Room	$	5,984	$	6,157	$	4,759
Food, beverage and convention services	4,023		4,077		3,179
General and administrative	2,917		2,919		2,357
Sales and marketing	3,260		3,069		2,642
Repairs and maintenance	2,099		2,362		1,815
Utilities	1,173		1,207		1,033
Property taxes and insurance	1,743		1,749		1,799
Other	1,571		1,367		1,603
Hotel expenses	$	22,770	$	22,907	$	19,187

⁽¹⁾ Hotel revenues - other includes $5.8 million of business interruption insurance recovery for the year ended December 31, 2017 related to the impact of Hurricane Matthew in October 2016, the result of which placed certain rooms at Springmaid Beach Resort out of service during the year ended December 31, 2017.

As of December 31, 2019, the Company owned three office properties encompassing in the aggregate 806,115 rentable square feet which were 68% occupied. The following table provides detailed information regarding the Company’s office revenues and expenses for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	For the Years Ended December 31,
	2019		2018		2017
Office revenues:
Rental income	$	27,978	$	29,104	$	15,204
Other income ⁽¹⁾	852		837		403
Office revenues	$	28,830	$	29,941	$	15,607

Office expenses:
Operating, maintenance, and management ⁽²⁾	$	9,349	$	8,362	$	3,636
Real estate taxes and insurance ⁽²⁾	4,356		3,960		1,736
Office expenses	$	13,705	$	12,322	$	5,372

⁽¹⁾ For the years ended December 31, 2018 and 2017, the Company reclassified $2.5 million, and $0.9 million of tenant reimbursement revenue for property taxes, insurance, and common area maintenance to rental income. See note 2, “Summary of Significant Accounting Policies” for a further discussion on this reclassification.

⁽²⁾On October 1, 2018, the Company placed the development of 210 West 31st Street on hold and began expensing certain costs that were previously capitalized. Included in office expenses for the year ended December 31, 2019 is $0.7 million of operating, maintenance and management and $0.5 million of real estate taxes and insurance for 210 West 31st Street.

The Company’s office properties are leased to tenants under operating leases for which the terms and expirations vary. As of December 31, 2019, the leases had remaining terms, excluding options to extend, of up to 8.7 years with a weighted-average remaining term of 3.3 years. Some of the leases may have provisions to extend the term of the lease, options for early termination for all or a part of the leased premises after paying a specified penalty and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires a security deposit from the tenant in the form of a cash deposit and/or a letter of credit. The amount required as a security deposit varies depending upon the terms of the respective lease and the creditworthiness of the tenant, but generally is not a significant amount. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to office tenant leases are included in other liabilities in the accompanying consolidated balance sheets and totaled $1.1 million and $1.3 million as of December 31, 2019 and 2018, respectively.

During the years ended December 31, 2019, 2018 and 2017, the Company recognized deferred rent from tenants of $0.6 million, $1.4 million and $0.8 million, respectively, net of lease incentive amortization. As of December 31, 2019 and 2018, the cumulative deferred rent receivable balance, including unamortized lease incentive receivables, was $2.9 million and $2.8 million, respectively, and is included in rents and other receivables on the accompanying balance sheets. The cumulative deferred rent balance included $0.2 million of unamortized lease incentives as of December 31, 2019 and 2018.

As of December 31, 2019, the Company’s commercial real estate properties were leased to approximately 80 tenants over a diverse range of industries and geographic areas. As of December 31, 2019, the highest tenant industry concentrations (greater than 10% of annualized base rent) in the Company’s portfolio were as follows:

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

No other tenant industries accounted for more than 10% of annualized base rent. No tenant accounted for more than 10% of annualized base rent. No material tenant credit issues have been identified at this time. During the year ended December 31, 2019, the Company recorded a $9,000 adjustment to office revenues for lease payments deemed not probable of collection. During the years ended December 31, 2019, 2018 and 2017, the Company recorded bad debt expense of $0.1 million, $0.3 million and $0.2 million, respectively, which were included in office expenses in the accompanying consolidated statements of operations.

As of December 31, 2019, the Company owned one apartment property with 292 units which was 93% occupied. The following table provides detailed information regarding the Company’s apartment revenues and expenses for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	For the Years Ended December 31,
	2019		2018		2017
Apartment revenues:
Rental income ⁽¹⁾	$	7,503	$	6,861	$	6,539
Other income	609		608		441
Apartment revenues	$	8,112	$	7,469	$	6,980

Apartment expenses:
Operating, maintenance, and management	$	2,177	$	2,423	$	2,278
Real estate taxes and insurance	1,377		1,356		1,346
Apartment expenses	$	3,554	$	3,779	$	3,624

⁽¹⁾ For the years ended December 31, 2018 and 2017, the Company reclassified $22,000 and $24,000, respectively, of tenant reimbursement revenue for property taxes, insurance, and common area maintenance to rental income. See note 2, “Summary of Significant Accounting Policies” for a further discussion on this reclassification.

As of December 31, 2019, the Company’s real estate investments in California represented 56.2% of the Company’s total assets. As a result, the geographic concentration of the Company’s portfolio makes it particularly susceptible to adverse economic developments in the California real estate market. Any adverse economic or real estate developments in this market, such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors, or any decrease in demand for office space resulting from the local business climate, could adversely affect the Company’s operating results and its ability to make distributions to stockholders.

On November 4, 2019, the Company, through an indirect wholly owned subsidiary, sold 2200 Paseo Verde to a purchaser unaffiliated with the Company or the Advisor for a sales price, net of closing credits of $18.7 million, excluding closing costs. The carrying value of 2200 Paseo Verde as of the disposition date was $13.5 million, which was net of $2.0 million of accumulated depreciation and amortization. The Company recognized a gain on sale of $4.2 million related to the disposition of 2200 Paseo Verde.


	December 31, 2019		December 31, 2018
Assets related to disposition
Real estate, cost	$	—	$	14,119
Accumulated depreciation and amortization	—		(1,455)
Real estate, net	—		12,664
Other assets	—		738
Total assets related to disposition	$	—	$	13,402
Liabilities related to disposition
Notes payable, net	—		7,914

Total liabilities related to disposition	$	—	$	7,914

The operations of this property and gain on sales are included in continuing operations on the accompanying statements of operations. The following table summarizes certain revenue and expenses related to this property for the years ended December 31, 2019, 2018 and 2017 (in thousands):


	For the Years Ended December 31,
	2019		2018		2017
Revenues
Rental income	$	1,315	$	1,534	$	1,206
Other operating income	32		27		35
Total revenues	$	1,347	$	1,561	$	1,241
Expenses
Operating, maintenance, and management	$	313	$	261	$	312
Real estate taxes and insurance	69		78		76
Asset management fees to affiliate	97		133		127
Depreciation and amortization	562		671		608
Interest expense	352		363		343
Total expenses	$	1,393	$	1,506	$	1,466

During the year ended December 31, 2018, the Company recorded impairment charges in the aggregate of $14.7 million to write-down the carrying value of 210 West 31st Street, a development property located in New York, New York, to its estimated fair value of $54.9 million due to a change in the projected hold period and related decrease in projected cash flows. The Company purchased 210 West 31st Street for $48.0 million plus $1.8 million of closing costs. Since acquisition in December 2016, the Company has capitalized $6.8 million related to a finance lease asset, $3.8 million in development costs and $9.2 million of other certain costs such as financing costs, real estate taxes and insurance costs that have been capitalized to building and improvements. On October 1, 2018, the Company placed the development on hold and ceased capitalizing expenses.