|9 Months Ended|
Sep. 30, 2016
|Real Estate [Abstract]|
|Real Estate Disclosure [Text Block]||
NOTE 3. REAL ESTATE
As of September 30, 2016, the Company’s real estate portfolio consisted of two properties in two states consisting of retail and office properties. The following table provides summary information regarding the Company’s real estate as of September 30, 2016:
Current Period Acquisitions
During the nine months ended September 30, 2016, the Company acquired the following properties:
The intangible assets acquired in connection with these acquisitions have a weighted average amortization period as of the date of the acquisition of approximately five years. The purchase price accounting reflected in the accompanying financial statements is preliminary and is based upon estimates and assumptions that are subject to change within the measurement period (up to one year from the acquisition date pursuant to ASC 805) that may impact the fair value of the assets and liabilities above (including real estate investments, other assets and accrued liabilities).
The Company recorded both acquisitions as business combinations and expensed $0 and $547,149 of acquisition costs related to the acquisition of these properties for the three and nine months ended September 30, 2016, respectively. During the three and nine months ended September 30, 2016, the Company recognized $359,544 and $401,009 of total revenues related to these properties.
The Company’s real estate properties are leased to tenants under triple-net leases for which terms and expirations vary. The Company monitors the credit of all tenants to stay abreast of any material changes in credit quality. The Company monitors tenant credit by (1) reviewing the credit ratings of tenants (or their parent companies or lease guarantors) that are rated by national recognized rating agencies; (2) reviewing financial statements and related metrics and information that are publicly available or that are required to be provided pursuant to the lease; (3) monitoring new reports and press releases regarding the tenants (or their parent companies or lease guarantors), and their underlying business and industry; and (4) monitoring the timeliness of rent collections.
As of September 30, 2016, each of the Company’s tenants is considered to be a major tenant concentration. The Company’s real estate properties are leased to Accredo Health Group, Inc. (“Accredo”) and Walgreen Company (“Walgreens”). The obligations under these two leases are guaranteed by Express Scripts Holding Company for Accredo and Walgreens Boots Alliance for Walgreens. Accredo and Walgreens each lease one of the Company’s real estate properties, which are located in Florida and Georgia, respectively.
Express Scripts Holding Company’s financial statements can be found at http://www.express-scripts.com . (NASDAQ: ESRX)
Walgreens Boots Alliance’s financial statements can be found at http://www.walgreensbootsalliance.com . (NASDAQ: WBA)
The future minimum contractual rent payments are shown in the table below. Both leases on the two properties owned by the Company expire in 2021.
As of September 30, 2016, the Company’s intangibles were as follows:
The intangible assets are amortized over the respective lease terms, which was approximately five years as of September 30, 2016. Amortization of intangible assets over the next five years is expected to be as follows:
Decreases in net income (loss) as a result of amortization of the Company’s tenant origination and absorption costs for the three and nine months ended September 30, 2016 were $91,760 and $106,419, respectively. Decreases in net income (loss) as a result of amortization of the Company’s above-market lease for the three and nine months ended September 30, 2016 were $8,331 and $9,720, respectively.
The entire disclosure for certain real estate investment financial statements, real estate investment trust operating support agreements, real estate owned, retail land sales, time share transactions, as well as other real estate related disclosures.
Reference 1: http://www.xbrl.org/2003/role/presentationRef