Investment in Unconsolidated Venture

12 Months Ended

Dec. 31, 2016

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Venture

Investment in Unconsolidated Venture

The following is a description of the Company’s investment in an unconsolidated venture, which the Company has elected to account for under the fair value option.

1285 Avenue of the Americas Venture

In May 2016, the Company, through a subsidiary of its operating partnership, completed the acquisition of a 0.2867% non-controlling interest in 1285 Avenue of the Americas (“1285 AoA”), a 1.8 million square foot Class-A office building located in midtown Manhattan for a purchase price of approximately $1.9 million, including closing costs. The remainder of the building is owned by institutional investors and funds affiliated with the Company’s Sub-advisor. The acquisition was part of an approximately $1.65 billion transaction sourced by RXR, the Company’s co-sponsor and affiliate of its Sub-advisor. The purchase of 1285 AoA was financed by the purchasers with $1.1 billion of acquisition financing and an additional $100.0 million future funding facility, with a seven-year term at a weighted average fixed interest rate of approximately 4.3% per annum. The purchase was approved by the Company’s board of directors, including all of its independent directors.

In December 2016, the Company increased its equity investment in 1285 AoA by contributing an additional $2.4 million into the venture.

As of December 31, 2016, the Company’s non-controlling interest in 1285 AoA was approximately 1.0%. It is accounted for as a cost method investment pursuant to ASC 323, “Investments-equity method and joint ventures,” for which the Company has elected the fair value option.

As of December 31, 2016, the carrying value of the Company’s investment was $5.2 million. For the year endedDecember 31, 2016, the Company recognized equity in earnings (losses) of unconsolidated venture of $939,303 comprising dividends received of $64,070 and an increase in fair value of the investment of $875,233.