INVESTMENT PROPERTIES

12 Months Ended

Jun. 30, 2020

Investments [Abstract]

INVESTMENT PROPERTIES

The following table presents the Company’s investment in properties in China as of June 30, 2020. The exchange rate is based on the market rate as of June 30, 2020.

	Investment Date / Reclassification Date	Investment Amount (RMB)			Investment Amount (U.S. Dollars)
Purchase of rental property – Property I – MaoYe Property	Jan 04, 2008		5,554			894
Currency translation			-			(87	)
Reclassification as “Assets held for sale”	July 01, 2018		(5,554	)		(807	)
Reclassification from “Assets held for sale”	Mar 31, 2019		2,024			301
			2,024			301
Purchase of rental property – Property II - JiangHuai	Jan 06, 2010		3,600			580
Purchase of rental property – Property III - Fu Li	Apr 08, 2010		4,025			648
Currency translation			-			(166	)
Gross investment in rental property			9,649			1,363
Accumulated depreciation on rental property	June 30, 2020		(6,558	)		(940	)
Reclassified as “Assets held for sale”	July 01, 2018		2,822			410
Reclassification from “Assets held for sale”	Mar 31, 2019		(1,029	)		(143	)
			(4,765	)		(673	)
Net investment in property – China			4,884			690

The following table presents the Company’s investment in properties in China as of June 30, 2019. The exchange rate is based on the market rate as of June 30, 2019.

	Investment Date / Reclassification Date	Investment Amount (RMB)			Investment Amount (U.S. Dollars)
Purchase of rental property – Property I – MaoYe Property	Jan 04, 2008		5,554			894
Currency translation			-			(87	)
Reclassification as “Assets held for sale”	July 01, 2018		(5,554	)		(807	)
Reclassification from “Assets held for sale”	Mar 31, 2019		2,024			301
			2,024			301
Purchase of rental property – Property II - JiangHuai	Jan 06, 2010		3,600			580
Purchase of rental property – Property III - Fu Li	Apr 08, 2010		4,025			648
Currency translation			-			(124	)
Gross investment in rental property			9,649			1,405
Accumulated depreciation on rental property	June 30, 2019		(6,075	)		(890	)
Reclassified as “Assets held for sale”-Mao Ye Property	July 01, 2018		2,822			410
Reclassification from “Assets held for sale”-Mao Ye Property	Mar 31, 2019		(1,029	)		(143	)
			(4,282	)		(623	)
Net investment in property – China			5,367			782

Rental Property I - MaoYe Property

In fiscal 2008, TTCQ purchased an office in Chongqing, China from MaoYe Property Ltd. (“MaoYe”) for a total cash purchase price of RMB 5,554, or approximately $894. During the fiscal year 2019, the Company sold thirteen of the fifteen units constituting the Mao Ye Property. Management has decided not to sell the remaining two units of Mao Ye properties in the near future, considering the market conditions in China.

Property purchased from MaoYe generated a rental income of $32 and $66 for the years ended June 30, 2020 and 2019, respectively.

Depreciation expense for MaoYe was $13 and $30 for the years ended June 30, 2020 and 2019, respectively.

Rental Property II - JiangHuai

In fiscal year 2010, TTCQ purchased eight units of commercial property in Chongqing, China from Chongqing JiangHuai Real Estate Development Co. Ltd. (“JiangHuai”) for a total purchase price of RMB 3,600, or approximately $580. TTCQ had yet to receive the title deed for these properties. TTCQ was in the legal process of obtaining the title deed until the developer encountered cash flow difficulties in the recent years. Since then, JiangHuai company is under liquidation and is now undergoing asset distribution. Nonetheless, this is not expected to affect the property’s market value but, in view of the COVID-19 pandemic and current economic situation, it is likely to be more tedious and time-consuming for the Court in their execution of the sale.

Property purchased from JiangHuai did not generate any rental income for both the years ended June 30, 2020 and 2019.

Depreciation expense for JiangHuai was $26 and $26 for the years ended June 30, 2020 and 2019, respectively.

Rental Property III – FuLi

In fiscal 2010, TTCQ entered into a Memorandum Agreement with Chongqing FuLi Real Estate Development Co. Ltd. (“FuLi”) to purchase two commercial properties totaling 311.99 square meters (“office space”) located in Jiang Bei District Chongqing. The total purchase price committed and paid was RMB 4,025, or approximately $648. The development was completed, and the property was handed over to TTCQ in April 2013 and the title deed was received during the third quarter of fiscal 2014.

The two commercial properties were leased to third parties under two separate rental agreements. One of such leases provides for a rent increase of 6% every year on May 1, commencing in 2019 until the rental agreement expires on April 30, 2021. The agreement was terminated in April 2020 due to the current slow and cautious market rental conditions. Management is still actively looking for a tenant.

For the other leased property (which lease expired on March 31, 2018), TTCQ signed on November 1, 2018 a rental agreement to rent out the 161 square meter space at a monthly rent of RMB 10, or approximately $2, which lease was to expire on October 31, 2019. In September 2019, TTCQ renewed the lease agreement at the same monthly rent of RMB 10, or approximately $2, for a period of one year from November 1, 2019.

Properties purchased from Fu Li generated a rental income of $30 and $32 for the years ended June 30, 2020 and 2019, respectively.

Depreciation expense for Fu Li was $28 and $30 for the years ended June 30, 2020 and 2019, respectively.

Summary

Total rental income for all investment properties in China was $62 for the year ended June 30, 2020, and $98 for the same period in the prior fiscal year.

Depreciation expenses for all investment properties in China were $67 and $86 for the years ended June 30, 2020 and 2019, respectively.