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AEI Income & Growth Fund 26

Document And Entity Information

Document And Entity Information12 Months Ended
Dec. 31, 2020USD ($)shares
Document Information Line Items
Entity Registrant NameAEI Income & Growth Fund 26 LLC
Document Type10-K
Current Fiscal Year End Date--12-31
Entity Common Stock, Shares Outstanding | shares1,738,006
Entity Public Float | $ $ 0
Amendment Flagfalse
Entity Central Index Key0001326321
Entity Current Reporting StatusYes
Entity Voluntary FilersNo
Entity Filer CategoryNon-accelerated Filer
Entity Well-known Seasoned IssuerNo
Document Period End DateDec. 31,
2020
Document Fiscal Year Focus2020
Document Fiscal Period FocusFY
Entity Small Businesstrue
Entity Emerging Growth Companyfalse
Entity Shell Companyfalse
Entity Interactive Data CurrentYes

Balance Sheet

Balance Sheet - USD ($)Dec. 31, 2020Dec. 31, 2019
Current Assets:
Cash $ 1,355,227 $ 1,331,120
Rent Receivable17,747 0
Total Current Assets1,372,974 1,331,120
Real Estate Investments:
Land2,848,286 2,866,197
Buildings7,714,695 7,775,160
Acquired Intangible Lease Assets808,152 808,152
Real Estate Held for Investment, at cost11,371,133 11,449,509
Accumulated Depreciation and Amortization(3,651,340)(3,233,760)
Real Estate Held for Investment, Net7,719,793 8,215,749
Long-Term Rent Receivable1,613 0
Total Assets9,094,380 9,546,869
Current Liabilities:
Payable to AEI Fund Management, Inc.53,953 68,108
Distributions Payable94,433 94,433
Unearned Rent0 420
Total Current Liabilities148,386 162,961
Long-term Liabilities:
Acquired Below-Market Lease Intangibles, Net140,507 170,091
Members’ Equity:
Managing Members(92,647)(80,397)
Limited Members – 10,000,000 Units authorized; 1,738,006 Units issued and outstanding as of December 31, 2020 and 20198,898,134 9,294,214
Total Members’ Equity8,805,487 9,213,817
Total Liabilities and Members’ Equity $ 9,094,380 $ 9,546,869

Balance Sheet (Parentheticals)

Balance Sheet (Parentheticals) - Limited Partner [Member] - sharesDec. 31, 2020Dec. 31, 2019
Limited Members, units authorized10,000,000 10,000,000
Limited Members, units issued1,738,006 1,738,006
Limited Members, units outstanding1,738,006 1,738,006

Statement of Operations

Statement of Operations - USD ($)12 Months Ended
Dec. 31, 2020Dec. 31, 2019
Income Statement [Abstract]
Rental Income $ 663,063 $ 722,519
Expenses:
LLC Administration – Affiliates108,100 145,508
LLC Administration and Property Management – Unrelated Parties100,625 127,622
Depreciation and Amortization410,004 389,526
Real Estate Impairment78,376 1,277,928
Total Expenses697,105 1,940,584
Operating Loss(34,042)(1,218,065)
Other Income:
Gain on Sale of Real Estate0 438,664
Interest Income3,441 10,486
Total Other Income3,441 449,150
Net Income(30,601)(768,915)
Net Loss Allocated:
Managing Members(918)(23,067)
Limited Members $ (29,683) $ (745,848)
Net Loss per LLC Unit (in Dollars per share) $ (0.02) $ (0.43)
Weighted Average Units Outstanding – Basic and Diluted (in Shares)1,738,006 1,738,006

Statement of Cash Flows

Statement of Cash Flows - USD ($)12 Months Ended
Dec. 31, 2020Dec. 31, 2019
Cash Flows from Operating Activities:
Net Loss $ (30,601) $ (768,915)
Adjustments to Reconcile Net Income To Net Cash Provided by Operating Activities:
Depreciation and Amortization387,996 367,518
Real Estate Impairment78,376 1,277,928
Gain on Sale of Real Estate0 (438,664)
(Increase) Decrease in Rent Receivable(19,360)0
Increase (Decrease) in Payable to AEI Fund Management, Inc.(14,155)22,830
Increase (Decrease) in Unearned Rent(420)420
Total Adjustments432,437 1,230,032
Net Cash Provided By (Used For) Operating Activities401,836 461,117
Cash Flows from Investing Activities:
Investments in Real Estate0 (1,042,610)
Proceeds from Sale of Real Estate0 1,905,734
Net Cash Provided By (Used For) Investing Activities0 863,124
Cash Flows from Financing Activities:
Distributions Paid to Members(377,729)(453,401)
Net Increase (Decrease) in Cash24,107 870,840
Cash, beginning of year1,331,120 460,280
Cash, end of year $ 1,355,227 $ 1,331,120

Statement of Changes in Members

Statement of Changes in Members' Equity - USD ($)General Partner [Member]Limited Partner [Member]Total
Balance at Dec. 31, 2018 $ (45,998) $ 10,406,460 $ 10,360,462
Balance (in Shares) at Dec. 31, 20181,738,006
Balance at Dec. 31, 2019(80,397) $ 9,294,214 9,213,817
Balance (in Shares) at Dec. 31, 20191,738,006
Distributions Declared(11,332) $ (366,398)(377,730)
Net Income (Loss)(23,067)(745,848)(768,915)
Balance at Dec. 31, 2020(92,647) $ 8,898,134 8,805,487
Balance (in Shares) at Dec. 31, 20201,738,006
Distributions Declared(11,332) $ (366,397)(377,729)
Net Income (Loss) $ (918) $ (29,683) $ (30,601)

Organization

Organization12 Months Ended
Dec. 31, 2020
Accounting Policies [Abstract]
Organization, Consolidation, Basis of Presentation, Business Description and Accounting Policies [Text Block](1) Organization –
AEI Income & Growth Fund 26 LLC (“Company”), a Limited Liability Company, was formed on March 14, 2005 to acquire and lease commercial properties to operating tenants. The Company's operations are managed by AEI Fund Management XXI, Inc. (“AFM”), the Managing Member. Robert P. Johnson, the Chief Executive Officer and sole director of AFM, served as the Special Managing Member until his withdrawal date effective March 31, 2020. AFM is a wholly owned subsidiary of AEI Capital Corporation of which Mr. Johnson and his wife own a majority interest. AEI Fund Management, Inc. (“AEI”), an affiliate of AFM, performs the administrative and operating functions for the Company.
The terms of the offering called for a subscription price of $10 per LLC Unit, payable on acceptance of the offer. The Company commenced operations on April 3, 2006 when minimum subscriptions of 150,000 LLC Units ($1,500,000) were accepted. The offering terminated October 19, 2007, when the extended offering period ended. The Company received subscriptions for 1,832,736 Units. Under the terms of the Operating Agreement, the Limited Members and Managing Members contributed funds of $18,327,360 and $1,000, respectively. The Company shall continue until December 31, 2055, unless dissolved, terminated and liquidated prior to that date.
During operations, any Net Cash Flow, as defined, which the Managing Members determine to distribute will be distributed 97% to the Limited Members and 3% to the Managing Members. Distributions to Limited Members will be made pro rata by Units.
Any Net Proceeds of Sale, as defined, from the sale or financing of properties which the Managing Members determine to distribute will, after provisions for debts and reserves, be paid in the following manner: (i) first, 99% to the Limited Members and 1% to the Managing Members until the Limited Members receive an amount equal to: (a) their Adjusted Capital Contribution plus (b) an amount equal to 6.5% of their Adjusted Capital Contribution per annum, cumulative but not compounded, to the extent not previously distributed from Net Cash Flow; (ii) any remaining balance will be distributed 90% to the Limited Members and 10% to the Managing Members. Distributions to the Limited Members will be made pro rata by Units.
For tax purposes, profits from operations, other than profits attributable to the sale, exchange, financing, refinancing or other disposition of property, will be allocated 97% to the Limited Members and 3% to the Managing Members. Net losses from operations will be allocated 99% to the Limited Members and 1% to the Managing Members.
For tax purposes, profits arising from the sale, financing, or other disposition of property will be allocated in accordance with the Operating Agreement as follows: (i) first, to those Members with deficit balances in their capital accounts in an amount equal to the sum of such deficit balances; (ii) second, 99% to the Limited Members and 1% to the Managing Members until the aggregate balance in the Limited Members' capital accounts equals the sum of the Limited Members' Adjusted Capital Contributions plus an amount equal to 6.5% of their Adjusted Capital Contributions per annum, cumulative but not compounded, to the extent not previously allocated; (iii) third, the balance of any remaining gain will then be allocated 90% to the Limited Members and 10% to the Managing Members. Losses will be allocated 99% to the Limited Members and 1% to the Managing Members.
The Managing Members are not required to currently fund a deficit capital balance. Upon liquidation of the Company or withdrawal by a Managing Member, the Managing Members will contribute to the Company an amount equal to the lesser of the deficit balances in their capital accounts or 1.01% of the total capital contributions of the Limited Members over the amount previously contributed by the Managing Members.

Summary of Significant Accounti

Summary of Significant Accounting Policies12 Months Ended
Dec. 31, 2020
Accounting Policies [Abstract]
Significant Accounting Policies [Text Block](2) Summary of Significant Accounting Policies –
Financial Statement Presentation
The accounts of the Company are maintained on the accrual basis of accounting for both federal income tax purposes and financial reporting purposes.
Accounting Estimates
Management uses estimates and assumptions in preparing these financial statements in accordance with United States Generally Accepted Accounting Principles (US GAAP). Those estimates and assumptions may affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates, and the difference could be material. Significant items, subject to such estimates and assumptions, include the carrying value of real estate held for investment, real estate held for sale and related intangible assets.
The Company regularly assesses whether market events and conditions indicate that it is reasonably possible to recover the carrying amounts of its investments in real estate from future operations and sales. A change in those market events and conditions could have a material effect on the carrying amount of its real estate.
Cash Concentrations of Credit Risk
The Company's cash is deposited in one financial institution and at times during the year it may exceed FDIC insurance limits.
Rent Receivables
Credit terms are extended to tenants in the normal course of business. The Company performs ongoing credit evaluations of its customers’ financial condition and, generally, requires no collateral.
Rent receivables are recorded at their estimated net realizable value. The Company follows a policy of providing an allowance for doubtful accounts; however, based on historical experience, and its evaluation of the current status of receivables, the Company is of the belief that such accounts, if any, will be collectible in all material respects and thus an allowance is not necessary. Accounts are considered past due if payment is not made on a timely basis in accordance with the Company’s credit terms. Receivables considered uncollectible are written off.
Income Taxes
The income or loss of the Company for federal income tax reporting purposes is includable in the income tax returns of the Members. In general, no recognition has been given to income taxes in the accompanying financial statements.
The tax return and the amount of distributable Company income or loss are subject to examination by federal and state taxing authorities. If such an examination results in changes to distributable Company income or loss, the taxable income of the members would be adjusted accordingly. Primarily due to its tax status as a partnership, the Company has no significant tax uncertainties that require recognition or disclosure. The Company is no longer subject to U.S. federal income tax examinations for tax years before 2017, and with few exceptions, is no longer subject to state tax examinations for tax years before 2017.
Revenue Recognition
The Company's real estate is leased under net leases, classified as operating leases. The leases provide for base annual rental payments payable in monthly installments. The Company recognizes rental income according to the terms of the individual leases. For deferred rents due to COVID-19, the Company recognizes the deferred rent related to the month it applies and records a rental receivable. For leases that contain stated rental increases, the increases are recognized in the year in which they are effective. Contingent rental payments are recognized when the contingencies on which the payments are based are satisfied and the rental payments become due under the terms of the leases.
Real Estate Investments
Upon acquisition of real properties, the Company records them in the financial statements at cost. The purchase price is allocated to tangible assets, consisting of land and building, and to identified intangible assets and liabilities, which may include the value of above market and below market leases and the value of in-place leases. The allocation of the purchase price is based upon the relative fair value of each component of the property. Although independent appraisals may be used to assist in the determination of fair value, in many cases these values will be based upon management’s assessment of each property, the selling prices of comparable properties and the discounted value of cash flows from the asset.
The fair values of above market and below market in-place leases will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases measured over a period equal to the non-cancelable term of the lease including any bargain renewal periods. The above market and below market lease values will be capitalized as intangible lease assets or liabilities. Above market lease values will be amortized as an adjustment of rental income over the remaining term of the respective leases. Below market lease values will be amortized as an adjustment of rental income over the remaining term of the respective leases, including any bargain renewal periods. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above market and below market in-place lease values relating to that lease would be recorded as an adjustment to rental income.
The fair values of in-place leases will include estimated direct costs associated with obtaining a new tenant, and opportunity costs associated with lost rentals which are avoided by acquiring an in-place lease. Direct costs associated with obtaining a new tenant may include commissions, tenant improvements, and other direct costs and are estimated, in part, by management’s consideration of current market costs to execute a similar lease. These direct costs will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease. These intangibles will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.
The Company tests real estate for recoverability when events or changes in circumstances indicate that the carrying value may not be recoverable. For properties the Company will hold and operate, it compares the carrying amount of the property to the estimated probability-weighted future undiscounted cash flows expected to result from the property and its eventual disposition. If the sum of the expected future cash flows is less than the carrying amount of the property, the Company recognizes an impairment loss by the amount by which the carrying amount of the property exceeds the fair value of the property. For properties held for sale, the Company determines whether impairment has occurred by comparing the property’s estimated fair value less cost to sell to its current carrying value. If the carrying value is greater than the net realizable value, an impairment loss is recorded to reduce the carrying value of the property to its net realizable value.
For financial reporting purposes, the buildings owned by the Company are depreciated using the straight-line method over an estimated useful life of 25 years. Intangible lease assets are amortized using the straight-line method for financial reporting purposes based on the remaining life of the lease.
The disposition of a property or classification of a property as Real Estate Held for Sale by the Company does not represent a strategic shift that will have a major effect on the Company’s operations and financial results. Therefore, the results from operating and selling the property are included in continuing operations.
The Company accounts for properties owned as tenants-in-common with affiliated entities and/or unrelated third parties using the proportionate consolidation method. Each tenant-in-common owns a separate, undivided interest in the properties. Any tenant-in-common that holds more than a 50% interest does not control decisions over the other tenant-in-common interests. The financial statements reflect only this Company's percentage share of the properties' land, building, liabilities, revenues and expenses.
The Company’s properties are subject to environmental laws and regulations adopted by various governmental entities in the jurisdiction in which the properties are located. These laws could require the Company to investigate and remediate the effects of the release or disposal of hazardous materials at these locations if found. For each property, an environmental assessment is completed prior to acquisition. In addition, the lease agreements typically strictly prohibit the production, handling, or storage of hazardous materials (except where incidental to the tenant’s business such as use of cleaning supplies) in violation of applicable law to restrict environmental and other damage. Environmental liabilities are recorded when it is determined the liability is probable and the costs can reasonably be estimated. There were no environmental issues noted or liabilities recorded at December 31, 2020 and 2019.
Fair Value Measurements
Fair value, as defined by US GAAP, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. US GAAP establishes a hierarchy in determining the fair value of an asset or liability. The fair value hierarchy has three levels of inputs, both observable and unobservable. US GAAP requires the utilization of the lowest possible level of input to determine fair value. Level 1 inputs include quoted market prices in an active market for identical assets or liabilities. Level 2 inputs are market data, other than Level 1 inputs, that are observable either directly or indirectly. Level 2 inputs include quoted market prices for similar assets or liabilities, quoted market prices in an inactive market, and other observable information that can be corroborated by market data. Level 3 inputs are unobservable and corroborated by little or no market data.
At December 31, 2020 and 2019, the Company had no financial assets or liabilities measured at fair value on a recurring basis or nonrecurring basis that would require disclosure. The Company had the following nonfinancial assets measured on a nonrecurring basis that were recorded at fair value during 2020 and 2019.
The Dick’s Sporting Goods store in Fredericksburg, Virginia with a carrying amount of $1,583,623 at March 31, 2019, was written down to its estimated fair value of $972,000 after completing our long-lived asset valuation analysis. The resulting impairment charge of $611,623 was included in earnings for the first quarter of 2019. The fair value of the property was based upon an appraisal prepared by an independent commercial property appraiser. The appraisal is considered a Level 3 input in the valuation hierarchy. At September 30, 2019, the property was written down to its estimated fair value of $661,500 after completing our long-lived asset valuation analysis. The resulting impairment charge of $298,990 was included in earnings for the third quarter of 2019. The fair value of the property was based upon a signed purchase agreement, which is considered a Level 3 input in the valuation hierarchy.
The Advance Auto store in Middletown, Ohio with a carrying amount of $546,065 at June 30, 2019, was written down to its estimated fair value of $178,750 after completing our long-lived asset valuation analysis. The resulting impairment charge of $367,315 was included in earnings for the second quarter of 2019. The fair value of the property was based upon comparable sales of similar properties, which are considered Level 2 inputs in the valuation hierarchy. At December 31, 2020, the property was written down to its estimated fair value of $82,500 after completing our long-lived asset valuation analysis. The resulting impairment charge of $78,376 was included in earnings for the fourth quarter of 2020. The fair value of the property was based upon comparable sales of similar properties, which are considered Level 2 inputs in the valuation hierarchy.
Income Per Unit
Income per LLC Unit is calculated based on the weighted average number of LLC Units outstanding during each period presented. Diluted income per LLC Unit considers the effect of any potentially dilutive Unit equivalents, of which the Company had none for each of the years ended December 31, 2020 and 2019.
Reportable Segments
The Company invests in single tenant commercial properties throughout the United States that are net leased to tenants in various industries. Because these net leased properties have similar economic characteristics, the Company evaluates operating performance on an overall portfolio basis. Therefore, the Company’s properties are classified as one reportable segment.
Recently Adopted Accounting Pronouncements
In April 2020, the Financial Accounting Standards Board (FASB) issued a question-and-answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of COVID-19. Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant or if a lease concession was under the enforceable rights and obligations within the existing lease agreement. The Lease Modification Q&A clarifies that entities may elect to not evaluate whether lease-related relief that lessors provide to mitigate the economic effects of COVID-19 on lessees is a lease modification under current lease guidance. Instead, an entity that elects not to evaluate whether a concession directly related to COVID-19 is a modification can then elect whether to apply the modification guidance.
During the year ended December 31, 2020, the Company provided lease concessions to certain tenants in response to the impact of COVID-19, in the form of rent deferrals. The Company has made an election to account for such lease concessions consistent with how those concessions would be accounted for under lease guidance if enforceable rights and obligations for those concessions had already existed in the leases. This election is available for concessions related to the effects of the COVID-19 pandemic that do not result in a substantial increase in the rights as lessor, including concessions that result in the total payments required by the modified lease being substantially the same as or less than total payments required by the original lease.
Substantially, all of the Company’s concessions to date provide for a deferral of payments with no substantive changes to the consideration in the original lease. These deferrals affect the timing, but not the amount, of the lease payments. The Company is accounting for these deferrals as if no changes to the lease were made. Under this accounting, the Company increases its rent receivables as tenant payments accrue and continues to recognize rental income. During the year ended December 31, 2020, the Company has entered into lease modifications that deferred $19,360, which was recognized as rental income for those deferred months in 2020.

Related Party Transactions

Related Party Transactions12 Months Ended
Dec. 31, 2020
Related Party Transactions [Abstract]
Related Party Transactions Disclosure [Text Block](3) Related Party Transactions –
The Company owns the percentage interest shown below in the following properties as tenants-in-common with the affiliated entities listed: property in Wichita, Kansas (40% – AEI Income & Growth Fund 25 LLC); Advance Auto Parts store (55% – AEI Income & Growth Fund 24 LLC); Best Buy store (46% – AEI Income & Growth Fund XXI Limited Partnership); and Fresenius Medical Center (54% – AEI Income & Growth Fund 27 LLC).
The Company owned a 40% interest in an Applebee’s restaurant. AEI Income & Growth Fund XXII Limited Partnership, an affiliate of the Company, owned a 60% interest in this property until the property was sold to an unrelated third party in 2019. The Company owned a 27% interest in a Dick’s Sporting Goods store. AEI Income & Growth Fund 23 LLC, AEI Income & Growth Fund 24 LLC and AEI Income & Growth Fund 25 LLC, affiliates of the Company, owned the remaining 73% interest in this property until the property was sold to an unrelated third party in 2019.
AEI received the following reimbursements for costs and expenses from the Company for the years ended December 31:
2020
2019
AEI is reimbursed for costs incurred in providing services related to managing the Company’s operations and properties, maintaining the Company’s books, and communicating with the Limited Members.
$
108,100
$
145,508
AEI is reimbursed for all direct expenses it paid on the Company’s behalf to third parties related to Company administration and property management. These expenses included printing costs, legal and filing fees, direct administrative costs, outside audit costs, taxes, insurance and other property costs.
$
100,625
$
127,622
AEI is reimbursed for costs incurred in providing services and direct expenses related to the acquisition of property on behalf of the Company.
$
0
$
1,850
AEI is reimbursed for costs incurred in providing services related to the sale of property on behalf of the Company.
$
0
$
9,159
The payable to AEI Fund Management, Inc. represents the balance due for the services described in 3a, b, c and d. This balance is non-interest bearing and unsecured and is to be paid in the normal course of business.

Real Estate Investments

Real Estate Investments12 Months Ended
Dec. 31, 2020
Real Estate [Abstract]
Real Estate Disclosure [Text Block](4) Real Estate Investments –
The Company leases its properties to tenants under net leases, classified as operating leases. Under a net lease, the tenant is responsible for real estate taxes, insurance, maintenance, repairs and operating expenses for the property. For some leases, the Company is responsible for repairs to the structural components of the building, the roof and the parking lot. At the time the properties were acquired, the remaining primary lease terms varied from 10 to 20 years. The leases provide the tenants with three to four five-year renewal options subject to the same terms and conditions as the primary term. The lease for the Best Buy store was extended to end on January 19, 2023.
The Company's properties are commercial, single-tenant buildings. The building in Wichita, Kansas was constructed in 1996, renovated in 2001 and acquired in 2006. The Advance Auto Parts store was constructed in 2004 and acquired in 2006. The Starbucks restaurant was constructed and acquired in 2007. The Best Buy store was constructed in 1990, renovated in 1997 and acquired in 2008. The Fresenius Medical Center was constructed in 2012 and acquired in 2014. The Zales store was constructed in 1983, renovated in 2014 and acquired in 2015. The Dollar Tree store was constructed in 2015 and acquired in 2016. There have been no costs capitalized as improvements subsequent to the acquisitions, except for $30,000 of tenant improvements related to the Cellular Connection store.
The cost of the properties not held for sale and related accumulated depreciation at December 31, 2020 are as follows:
Property
Land
Buildings
Total
Accumulated
Depreciation
Biomat USA, Wichita, KS
$
507,489
$
1,277,436
$
1,784,925
$
817,485
Advance Auto Parts, Middletown, OH
18,854
557,744
576,598
494,098
Cellular Connection, Bluffton, IN
344,008
836,108
1,180,116
448,996
Best Buy, Eau Claire, WI
803,535
2,158,403
2,961,938
836,994
Fresenius Medical Center, Chicago, IL
464,400
665,142
1,129,542
159,626
Zales, Enid, OK
440,000
903,630
1,343,630
209,335
Dollar Tree, West Point, MS
270,000
1,316,232
1,586,232
258,854
$
2,848,286
$
7,714,695
$
10,562,981
$
3,225,388
For the years ended December 31, 2020 and 2019, the Company recognized depreciation expense of $295,860 and $317,780, respectively.
The following schedule presents the cost and related accumulated amortization of acquired lease intangibles not held for sale at December 31:
2020
2019
Cost
Accumulated Amortization
Cost
Accumulated Amortization
In-Place Lease Intangibles
(weighted average life of 55 and 72 months, respectively)
$
735,546
$
382,390
$
735,546
$
268,246
Above-Market Lease Intangibles
(weighted average life of 46 and 58 months, respectively)
72,606
43,562
72,606
35,986
Acquired Intangible Lease Assets
$
808,152
$
425,952
$
808,152
$
304,232
Acquired Below-Market Lease Intangibles
(weighted average life of 57 and 69 months, respectively)
$
283,495
$
142,988
$
283,495
$
113,404
For the years ended December 31, 2020 and 2019, the value of in-place lease intangibles amortized to expense was $114,144 and $71,746, the decrease to rental income for above-market leases was $7,576 and $7,576, and the increase to rental income for below-market leases was $29,584 and $29,584, respectively.
For lease intangibles not held for sale at December 31, 2020, the estimated amortization for the next five years is as follows:
Amortization Expense for
In-Place Lease Intangibles
Decrease to Rental Income
for Above-Market Leases
Increase to Rental Income
for Below-Market Leases
2021
$
81,384
$
7,576
$
29,584
2022
81,384
7,576
29,584
2023
63,716
7,576
29,584
2024
58,906
6,316
29,584
2025
36,842
0
22,171
$
322,232
$
29,044
$
140,507
The Company owns a 40% interest in a former Sports Authority store in Wichita, Kansas. On March 2, 2016, the tenant, TSA Stores, Inc., and its parent company, The Sports Authority, Inc., the guarantor of the lease, filed for Chapter 11 bankruptcy reorganization. In June 2016, the tenant filed a motion with the bankruptcy court to reject the lease for this store effective June 30, 2016, at which time the tenant returned possession of the property to the owners. As of December 31, 2020, the tenant owed $19,366 of past due rent, which was not accrued for financial reporting purposes. The owners listed the property for lease with a real estate broker in the Wichita area. While the property was vacant, the Company was responsible for its 40% share of real estate taxes and other costs associated with maintaining the property.
On September 21, 2017, the Company entered into a lease agreement with a primary term of 10 years with Biomat USA, Inc. (“Biomat”) as a replacement tenant for 28% of the square footage of the property. The tenant operates a Biomat USA Plasma Center in the space. The Company’s 40% share of annual rent, which commenced on June 18, 2018, is $37,071. Biomat agreed to pay for the costs to divide the building into two separate spaces, the costs of tenant improvements to remodel the Biomat space and 28% of the cost to replace the roof.
On August 27, 2019, the Company entered into a lease agreement with a primary term of 10 years with BigTime Fun Center, LLC as a replacement tenant for 57% of the square footage of the property. The tenant will operate an indoor sports entertainment center in the space. The Company’s 40% share of annual rent, which commenced on February 23, 2020, is $78,000. As part of the agreement, the Company will pay a tenant improvement allowance of $64,000 when certain conditions are met by the tenant. Due to ongoing difficulties due to the COVID-19 Pandemic the Company is negotiating a rent commencement date of April 1, 2021. As a part of the negotiations the tenant improvement allowance will be replaced with a ten month rent abatement starting April 1, 2021. Additionally, this agreement would forebear rent and additional charges for the period from February 23, 2020 to March 31, 2021. In September 2019, the Company paid $32,760 to a real estate broker for its 40% share of the lease commission due as part of the lease transaction. This amount was capitalized and will be amortized over the term of the lease. On January 22, 2021 the owner of Big Time Fund Center, LLC informed the Company that it does not intend to open the Wichita property. As a result of the tenant informing the Company of their intention not to open, the full amount of the lease commission was amortized in the fourth quarter of 2020. The property is in the process of being marketed for lease again.
The Company owned a 27% interest in a Dick’s Sporting Goods store in Fredericksburg, Virginia. The remaining interests in the property were owned by three affiliates of the Company. On January 31, 2019, the lease term ended, and the tenant returned possession of the property to the owners. While the property was vacant, the Company was responsible for its 27% share of real estate taxes and other costs associated with maintaining the property. The owners listed the property for lease with a real estate broker in the Fredericksburg area. The annual rent from this property represented approximately 24% of the total annual rent of the Company’s property portfolio. The loss of rent and increased expenses related to this property decreased the Company’s cash flow. Consequently, beginning with the first quarter of 2019, the Company reduced its regular quarterly cash distribution rate from $0.0949 per Unit to $0.0527 per Unit.
Based on its long-lived asset valuation analysis, the Company determined the former Dick’s Sporting Goods store was impaired. As a result, in the first quarter of 2019, the Company recognized real estate impairment of $611,623 to decrease the carrying value to the estimated fair value of $972,000. The charge was recorded against the cost of the land and building.
In October 2019, after marketing the property for lease for many months, the Company decided to sell its 27% interest in the former Dick’s Sporting Goods store. In the third quarter of 2019, as a result of deciding to sell the property, the Company recognized an additional real estate impairment of $298,990 to decrease the carrying value to the estimated fair value of $661,500. The charges were recorded against the cost of the land and building. In November 2019, the Company entered into an agreement to sell the property to an unrelated third party. On December 27, 2019, the sale closed with the Company receiving net proceeds of $663,277, which resulted in a net gain of $1,777. At the time of sale, the cost and related accumulated depreciation was $1,385,017 and $723,517, respectively.
In December 2018, the Company decided to sell the Applebee’s restaurant in Crawfordsville, Indiana. In January 2019, the Company entered into an agreement to sell the property to an unrelated third party. On April 8, 2019, the sale closed with the Company receiving net proceeds of $1,242,457, which resulted in a net gain of $436,887. At the time of sale, the cost and related accumulated depreciation was $1,237,771 and $432,201, respectively.
On June 6, 2019, the Company purchased an additional 16% joint-venture interest in the Best Buy store in Eau Claire, Wisconsin for $1,009,850 from AEI Income & Growth Fund 23 LLC (“Fund 23”), an affiliate of the Company. The purchase price of the property interest was based upon the property’s fair market value as determined by an independent, third-party, commercial property appraiser. The property interest became available because Fund 23 was in the process of liquidating its property portfolio. The Company now owns a 46% interest in the Best Buy property. The Company allocated $69,074 of the purchase price to Acquired Intangible Lease Assets, representing in-place lease intangibles. The annual rent for the additional 16% interest that was purchased is $83,627.
The Company owns a 55% interest in an Advance Auto Parts store in Middletown, Ohio. The remaining interest in the property is owned by an affiliate of the Company. On July 31, 2019, the lease term ended, and the tenant returned possession of the property to the owners. While the property is vacant, the Company is responsible for its 55% share of real estate taxes and other costs associated with maintaining the property. The owners have listed the property for sale or lease with a real estate broker in the Middletown area. The annual rent from this property represented approximately 11% of the total annual rent of the Company’s property portfolio. The loss of rent and increased expenses related to this property will decrease the Company’s cash flow.
Based on its long-lived asset valuation analysis, the Company determined the Advance Auto store was impaired. As a result, in the second quarter of 2019, a charge to operations for real estate impairment of $367,315 was recognized, which was the difference between the carrying value at June 30, 2019 of $546,065 and the estimated fair value of $178,750. Based on its long-lived asset valuation analysis in the fourth quarter of 2020, the Company recognized an additional real estate impairment of $78,376 to decrease the carrying value to the estimated fair value of $82,500. The charges were recorded against the cost of the land and building.
For properties owned as of December 31, 2020, the minimum future rent payments required by the leases are as follows:
2021
$
643,158
2022
645,729
2023
390,850
2024
352,122
2025
231,216
Thereafter
246,801
$
2,509,876
There were no contingent rents recognized in 2020 and 2019.

Major Tenants

Major Tenants12 Months Ended
Dec. 31, 2020
Accounting Policies [Abstract]
Major Customers, Policy [Policy Text Block](5) Major Tenants –
The following schedule presents rental income from individual tenants, or affiliated groups of tenants, who each contributed more than ten percent of the Company's total rental income for the years ended December 31:
Tenants
2020
2019
Best Buy Stores, L.P.
$
240,427
$
204,421
Dollar Tree Stores, Inc.
137,084
137,084
Zale Delaware Inc.
108,584
99,784
Fresenius Medical Care of Illinois
100,336
97,889
Aggregate rental income of major tenants
$
586,431
$
539,178
Aggregate rental income of major tenants
as a percentage of total rental income
88%
75%

Members' Equity

Members' Equity12 Months Ended
Dec. 31, 2020
Partners' Capital Notes [Abstract]
Partners' Capital Notes Disclosure [Text Block](6) Members’ Equity –
For the years ended December 31, 2020 and 2019, the Company declared distributions of $377,729 and $377,730. The Limited Members received distributions of $366,397 and $366,398 and the Managing Members received distributions of $11,332 and $11,332 for the years, respectively. The Limited Members' distributions represented $0.21 and $0.21 per LLC Unit outstanding using 1,738,006 weighted average Units in both years. The distributions represented $0 and $0 per Unit of Net Income and $0.21 and $0.21 per Unit of return of contributed capital in 2020 and 2019, respectively.
The Company may repurchase Units from Limited Members who have tendered their Units to the Company. Such Units may be acquired at a discount. The Company will not be obligated to purchase in any year more than 2% of the total number of Units outstanding on January 1 of such year. In no event shall the Company be obligated to purchase Units if, in the sole discretion of the Managing Member, such purchase would impair the capital or operation of the Company. During 2020 and 2019, the Company did not repurchase any Units from the Limited Members.

Income Taxes

Income Taxes12 Months Ended
Dec. 31, 2020
Income Tax Disclosure [Abstract]
Income Tax Disclosure [Text Block](7) Income Taxes –
The following is a reconciliation of net income for financial reporting purposes to income reported for federal income tax purposes for the years ended December 31:
2020
2019
Net Income (Loss) for Financial Reporting Purposes
$
(30,601)
$
(768,915)
Depreciation for Tax Purposes Under Depreciation
and Amortization for Financial Reporting Purposes
130,726
76,399
Income Accrued for Tax Purposes Over (Under)
Income for Financial Reporting Purposes
(420)
420
Real Estate Impairment Loss
Not Recognized for Tax Purposes
78,376
1,277,928
Loss on Sale of Real Estate for Tax Purposes
Compared to Gain for Financial Reporting Purposes
0
(2,054,033)
Taxable Income to Members
$
178,081
$
(1,468,201)
The following is a reconciliation of Members’ Equity for financial reporting purposes to Members’ Equity reported for federal income tax purposes for the years ended December 31:
2020
2019
Members’ Equity for Financial Reporting Purposes
$
8,805,487
$
9,213,817
Adjusted Tax Basis of Investments in Real Estate
Over Net Investments in Real Estate
for Financial Reporting Purposes
2,101,571
1,892,469
Income Accrued for Tax Purposes Over
Income for Financial Reporting Purposes
19,366
19,786
Syndication Costs Treated as Reduction
of Capital For Financial Reporting Purposes
2,691,997
2,691,997
Members’ Equity for Tax Reporting Purposes
$
13,618,421
$
13,818,069

COVID-19 Outbreak

COVID-19 Outbreak12 Months Ended
Dec. 31, 2020
COVID-19 Outbreak [Abstract]
COVID-19 Outbreak [Text Block](8) COVID-19 Outbreak –
During the first quarter of 2020, there was a global outbreak of COVID-19 which continues to adversely impact global commercial activity and has contributed to significant volatility in financial markets. The global impact of the outbreak has been rapidly evolving, and as cases of the virus have continued to be identified in additional countries, many countries have reacted by instituting quarantines, placing restrictions on travel, and limiting hours of operations of non-essential offices and retail centers. Such actions are creating disruption in global supply chains, and adversely impacting a number of industries, such as retail, restaurants and transportation. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19. Nevertheless, COVID-19 presents material uncertainty and risk with respect to the Company’s performance and financial results, such as the potential negative impact to the tenants of its properties, the potential closure of certain of its properties, increased costs of operations, decrease in values of its properties, changes in law and/or regulation, and uncertainty regarding government and regulatory policy. Up to the date of this filing, the Company has entered into a rent deferral agreement with one tenant of the seven properties owned by the Company. In June 2020, the Company entered into an agreement with the tenant of the Zales store in Enid, Oklahoma to defer base rent in April and May 2020. The tenant shall pay the deferred amounts in twelve equal monthly installments beginning on February 1, 2021.
The Company has elected not to account for these deferrals of rent as a lease modification under COVID-19 guidance issued by the FASB. Deferred rent of $19,360 was recognized as rental income during the year ended December 31, 2020 and a corresponding rent receivable was recorded. The Company continues to work closely with tenants to determine the best course of action to meet the tenants short-term rental needs during these unprecedented times.

Accounting Policies, by Policy

Accounting Policies, by Policy (Policies)12 Months Ended
Dec. 31, 2020
Accounting Policies [Abstract]
Distribution Policy, Members or Limited Partners, DescriptionDuring operations, any Net Cash Flow, as defined, which the Managing Members determine to distribute will be distributed 97% to the Limited Members and 3% to the Managing Members. Distributions to Limited Members will be made pro rata by Units. Any Net Proceeds of Sale, as defined, from the sale or financing of properties which the Managing Members determine to distribute will, after provisions for debts and reserves, be paid in the following manner: (i) first, 99% to the Limited Members and 1% to the Managing Members until the Limited Members receive an amount equal to: (a) their Adjusted Capital Contribution plus (b) an amount equal to 6.5% of their Adjusted Capital Contribution per annum, cumulative but not compounded, to the extent not previously distributed from Net Cash Flow; (ii) any remaining balance will be distributed 90% to the Limited Members and 10% to the Managing Members. Distributions to the Limited Members will be made pro rata by Units.
Key Provisions of Operating or Partnership Agreement, DescriptionFor tax purposes, profits from operations, other than profits attributable to the sale, exchange, financing, refinancing or other disposition of property, will be allocated 97% to the Limited Members and 3% to the Managing Members. Net losses from operations will be allocated 99% to the Limited Members and 1% to the Managing Members. For tax purposes, profits arising from the sale, financing, or other disposition of property will be allocated in accordance with the Operating Agreement as follows: (i) first, to those Members with deficit balances in their capital accounts in an amount equal to the sum of such deficit balances; (ii) second, 99% to the Limited Members and 1% to the Managing Members until the aggregate balance in the Limited Members' capital accounts equals the sum of the Limited Members' Adjusted Capital Contributions plus an amount equal to 6.5% of their Adjusted Capital Contributions per annum, cumulative but not compounded, to the extent not previously allocated; (iii) third, the balance of any remaining gain will then be allocated 90% to the Limited Members and 10% to the Managing Members. Losses will be allocated 99% to the Limited Members and 1% to the Managing Members. The Managing Members are not required to currently fund a deficit capital balance. Upon liquidation of the Company or withdrawal by a Managing Member, the Managing Members will contribute to the Company an amount equal to the lesser of the deficit balances in their capital accounts or 1.01% of the total capital contributions of the Limited Members over the amount previously contributed by the Managing Members.
Basis of Accounting, Policy [Policy Text Block]The accounts of the Company are maintained on the accrual basis of accounting for both federal income tax purposes and financial reporting purposes.
Use of Estimates, Policy [Policy Text Block]Management uses estimates and assumptions in preparing these financial statements in accordance with United States Generally Accepted Accounting Principles (US GAAP). Those estimates and assumptions may affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates, and the difference could be material. Significant items, subject to such estimates and assumptions, include the carrying value of real estate held for investment, real estate held for sale and related intangible assets.
The Company regularly assesses whether market events and conditions indicate that it is reasonably possible to recover the carrying amounts of its investments in real estate from future operations and sales. A change in those market events and conditions could have a material effect on the carrying amount of its real estate.
Concentration Risk, Credit Risk, Policy [Policy Text Block]The Company's cash is deposited in one financial institution and at times during the year it may exceed FDIC insurance limits.
Receivable [Policy Text Block]Credit terms are extended to tenants in the normal course of business. The Company performs ongoing credit evaluations of its customers’ financial condition and, generally, requires no collateral.
Rent receivables are recorded at their estimated net realizable value. The Company follows a policy of providing an allowance for doubtful accounts; however, based on historical experience, and its evaluation of the current status of receivables, the Company is of the belief that such accounts, if any, will be collectible in all material respects and thus an allowance is not necessary. Accounts are considered past due if payment is not made on a timely basis in accordance with the Company’s credit terms. Receivables considered uncollectible are written off.
Income Tax, Policy [Policy Text Block]The income or loss of the Company for federal income tax reporting purposes is includable in the income tax returns of the Members. In general, no recognition has been given to income taxes in the accompanying financial statements.
The tax return and the amount of distributable Company income or loss are subject to examination by federal and state taxing authorities. If such an examination results in changes to distributable Company income or loss, the taxable income of the members would be adjusted accordingly. Primarily due to its tax status as a partnership, the Company has no significant tax uncertainties that require recognition or disclosure. The Company is no longer subject to U.S. federal income tax examinations for tax years before 2017, and with few exceptions, is no longer subject to state tax examinations for tax years before 2017.
Revenue Recognition, Leases [Policy Text Block]The Company's real estate is leased under net leases, classified as operating leases. The leases provide for base annual rental payments payable in monthly installments. The Company recognizes rental income according to the terms of the individual leases. For deferred rents due to COVID-19, the Company recognizes the deferred rent related to the month it applies and records a rental receivable. For leases that contain stated rental increases, the increases are recognized in the year in which they are effective. Contingent rental payments are recognized when the contingencies on which the payments are based are satisfied and the rental payments become due under the terms of the leases.
Property, Plant and Equipment, Policy [Policy Text Block]Upon acquisition of real properties, the Company records them in the financial statements at cost. The purchase price is allocated to tangible assets, consisting of land and building, and to identified intangible assets and liabilities, which may include the value of above market and below market leases and the value of in-place leases. The allocation of the purchase price is based upon the relative fair value of each component of the property. Although independent appraisals may be used to assist in the determination of fair value, in many cases these values will be based upon management’s assessment of each property, the selling prices of comparable properties and the discounted value of cash flows from the asset.
The fair values of above market and below market in-place leases will be recorded based on the present value (using an interest rate which reflects the risks associated with the leases acquired) of the difference between (i) the contractual amounts to be paid pursuant to the in-place leases and (ii) an estimate of fair market lease rates for the corresponding in-place leases measured over a period equal to the non-cancelable term of the lease including any bargain renewal periods. The above market and below market lease values will be capitalized as intangible lease assets or liabilities. Above market lease values will be amortized as an adjustment of rental income over the remaining term of the respective leases. Below market lease values will be amortized as an adjustment of rental income over the remaining term of the respective leases, including any bargain renewal periods. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of above market and below market in-place lease values relating to that lease would be recorded as an adjustment to rental income.
The fair values of in-place leases will include estimated direct costs associated with obtaining a new tenant, and opportunity costs associated with lost rentals which are avoided by acquiring an in-place lease. Direct costs associated with obtaining a new tenant may include commissions, tenant improvements, and other direct costs and are estimated, in part, by management’s consideration of current market costs to execute a similar lease. These direct costs will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. The value of opportunity costs will be calculated using the contractual amounts to be paid pursuant to the in-place leases over a market absorption period for a similar lease. These intangibles will be included in intangible lease assets on the balance sheet and will be amortized to expense over the remaining term of the respective leases. If a lease were to be terminated prior to its stated expiration, all unamortized amounts of in-place lease assets relating to that lease would be expensed.
The Company tests real estate for recoverability when events or changes in circumstances indicate that the carrying value may not be recoverable. For properties the Company will hold and operate, it compares the carrying amount of the property to the estimated probability-weighted future undiscounted cash flows expected to result from the property and its eventual disposition. If the sum of the expected future cash flows is less than the carrying amount of the property, the Company recognizes an impairment loss by the amount by which the carrying amount of the property exceeds the fair value of the property. For properties held for sale, the Company determines whether impairment has occurred by comparing the property’s estimated fair value less cost to sell to its current carrying value. If the carrying value is greater than the net realizable value, an impairment loss is recorded to reduce the carrying value of the property to its net realizable value.
For financial reporting purposes, the buildings owned by the Company are depreciated using the straight-line method over an estimated useful life of 25 years. Intangible lease assets are amortized using the straight-line method for financial reporting purposes based on the remaining life of the lease.
The disposition of a property or classification of a property as Real Estate Held for Sale by the Company does not represent a strategic shift that will have a major effect on the Company’s operations and financial results. Therefore, the results from operating and selling the property are included in continuing operations.
The Company accounts for properties owned as tenants-in-common with affiliated entities and/or unrelated third parties using the proportionate consolidation method. Each tenant-in-common owns a separate, undivided interest in the properties. Any tenant-in-common that holds more than a 50% interest does not control decisions over the other tenant-in-common interests. The financial statements reflect only this Company's percentage share of the properties' land, building, liabilities, revenues and expenses.
The Company’s properties are subject to environmental laws and regulations adopted by various governmental entities in the jurisdiction in which the properties are located. These laws could require the Company to investigate and remediate the effects of the release or disposal of hazardous materials at these locations if found. For each property, an environmental assessment is completed prior to acquisition. In addition, the lease agreements typically strictly prohibit the production, handling, or storage of hazardous materials (except where incidental to the tenant’s business such as use of cleaning supplies) in violation of applicable law to restrict environmental and other damage. Environmental liabilities are recorded when it is determined the liability is probable and the costs can reasonably be estimated. There were no environmental issues noted or liabilities recorded at December 31, 2020 and 2019.
Fair Value of Financial Instruments, Policy [Policy Text Block]Fair value, as defined by US GAAP, is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date in the principal or most advantageous market. US GAAP establishes a hierarchy in determining the fair value of an asset or liability. The fair value hierarchy has three levels of inputs, both observable and unobservable. US GAAP requires the utilization of the lowest possible level of input to determine fair value. Level 1 inputs include quoted market prices in an active market for identical assets or liabilities. Level 2 inputs are market data, other than Level 1 inputs, that are observable either directly or indirectly. Level 2 inputs include quoted market prices for similar assets or liabilities, quoted market prices in an inactive market, and other observable information that can be corroborated by market data. Level 3 inputs are unobservable and corroborated by little or no market data.
At December 31, 2020 and 2019, the Company had no financial assets or liabilities measured at fair value on a recurring basis or nonrecurring basis that would require disclosure. The Company had the following nonfinancial assets measured on a nonrecurring basis that were recorded at fair value during 2020 and 2019.
The Dick’s Sporting Goods store in Fredericksburg, Virginia with a carrying amount of $1,583,623 at March 31, 2019, was written down to its estimated fair value of $972,000 after completing our long-lived asset valuation analysis. The resulting impairment charge of $611,623 was included in earnings for the first quarter of 2019. The fair value of the property was based upon an appraisal prepared by an independent commercial property appraiser. The appraisal is considered a Level 3 input in the valuation hierarchy. At September 30, 2019, the property was written down to its estimated fair value of $661,500 after completing our long-lived asset valuation analysis. The resulting impairment charge of $298,990 was included in earnings for the third quarter of 2019. The fair value of the property was based upon a signed purchase agreement, which is considered a Level 3 input in the valuation hierarchy.
The Advance Auto store in Middletown, Ohio with a carrying amount of $546,065 at June 30, 2019, was written down to its estimated fair value of $178,750 after completing our long-lived asset valuation analysis. The resulting impairment charge of $367,315 was included in earnings for the second quarter of 2019. The fair value of the property was based upon comparable sales of similar properties, which are considered Level 2 inputs in the valuation hierarchy. At December 31, 2020, the property was written down to its estimated fair value of $82,500 after completing our long-lived asset valuation analysis. The resulting impairment charge of $78,376 was included in earnings for the fourth quarter of 2020. The fair value of the property was based upon comparable sales of similar properties, which are considered Level 2 inputs in the valuation hierarchy.
Earnings Per Share, Policy [Policy Text Block]Income per LLC Unit is calculated based on the weighted average number of LLC Units outstanding during each period presented. Diluted income per LLC Unit considers the effect of any potentially dilutive Unit equivalents, of which the Company had none for each of the years ended December 31, 2020 and 2019.
Segment Reporting, Policy [Policy Text Block]The Company invests in single tenant commercial properties throughout the United States that are net leased to tenants in various industries. Because these net leased properties have similar economic characteristics, the Company evaluates operating performance on an overall portfolio basis. Therefore, the Company’s properties are classified as one reportable segment.
New Accounting Pronouncements, Policy [Policy Text Block]In April 2020, the Financial Accounting Standards Board (FASB) issued a question-and-answer document (the “Lease Modification Q&A”) focused on the application of lease accounting guidance to lease concessions provided as a result of COVID-19. Under existing lease guidance, the Company would have to determine, on a lease by lease basis, if a lease concession was the result of a new arrangement reached with the tenant or if a lease concession was under the enforceable rights and obligations within the existing lease agreement. The Lease Modification Q&A clarifies that entities may elect to not evaluate whether lease-related relief that lessors provide to mitigate the economic effects of COVID-19 on lessees is a lease modification under current lease guidance. Instead, an entity that elects not to evaluate whether a concession directly related to COVID-19 is a modification can then elect whether to apply the modification guidance.
During the year ended December 31, 2020, the Company provided lease concessions to certain tenants in response to the impact of COVID-19, in the form of rent deferrals. The Company has made an election to account for such lease concessions consistent with how those concessions would be accounted for under lease guidance if enforceable rights and obligations for those concessions had already existed in the leases. This election is available for concessions related to the effects of the COVID-19 pandemic that do not result in a substantial increase in the rights as lessor, including concessions that result in the total payments required by the modified lease being substantially the same as or less than total payments required by the original lease.
Substantially, all of the Company’s concessions to date provide for a deferral of payments with no substantive changes to the consideration in the original lease. These deferrals affect the timing, but not the amount, of the lease payments. The Company is accounting for these deferrals as if no changes to the lease were made. Under this accounting, the Company increases its rent receivables as tenant payments accrue and continues to recognize rental income. During the year ended December 31, 2020, the Company has entered into lease modifications that deferred $19,360, which was recognized as rental income for those deferred months in 2020.
COVID-19 Outbreak [Policy Text Block]During the first quarter of 2020, there was a global outbreak of COVID-19 which continues to adversely impact global commercial activity and has contributed to significant volatility in financial markets. The global impact of the outbreak has been rapidly evolving, and as cases of the virus have continued to be identified in additional countries, many countries have reacted by instituting quarantines, placing restrictions on travel, and limiting hours of operations of non-essential offices and retail centers. Such actions are creating disruption in global supply chains, and adversely impacting a number of industries, such as retail, restaurants and transportation. The outbreak could have a continued adverse impact on economic and market conditions and trigger a period of global economic slowdown. The rapid development and fluidity of this situation precludes any prediction as to the ultimate adverse impact of COVID-19. Nevertheless, COVID-19 presents material uncertainty and risk with respect to the Company’s performance and financial results, such as the potential negative impact to the tenants of its properties, the potential closure of certain of its properties, increased costs of operations, decrease in values of its properties, changes in law and/or regulation, and uncertainty regarding government and regulatory policy. Up to the date of this filing, the Company has entered into a rent deferral agreement with one tenant of the seven properties owned by the Company. In June 2020, the Company entered into an agreement with the tenant of the Zales store in Enid, Oklahoma to defer base rent in April and May 2020. The tenant shall pay the deferred amounts in twelve equal monthly installments beginning on February 1, 2021.
The Company has elected not to account for these deferrals of rent as a lease modification under COVID-19 guidance issued by the FASB. Deferred rent of $19,360 was recognized as rental income during the year ended December 31, 2020 and a corresponding rent receivable was recorded. The Company continues to work closely with tenants to determine the best course of action to meet the tenants short-term rental needs during these unprecedented times.

Related Party Transactions (Tab

Related Party Transactions (Tables)12 Months Ended
Dec. 31, 2020
Related Party Transactions [Abstract]
Schedule of Related Party Transactions [Table Text Block]Related Party Transactions
2020
2019
AEI is reimbursed for costs incurred in providing services related to managing the Company’s operations and properties, maintaining the Company’s books, and communicating with the Limited Members.
$
108,100
$
145,508
AEI is reimbursed for all direct expenses it paid on the Company’s behalf to third parties related to Company administration and property management. These expenses included printing costs, legal and filing fees, direct administrative costs, outside audit costs, taxes, insurance and other property costs.
$
100,625
$
127,622
AEI is reimbursed for costs incurred in providing services and direct expenses related to the acquisition of property on behalf of the Company.
$
0
$
1,850
AEI is reimbursed for costs incurred in providing services related to the sale of property on behalf of the Company.
$
0
$
9,159

Real Estate Investments (Tables

Real Estate Investments (Tables)12 Months Ended
Dec. 31, 2020
Real Estate [Abstract]
Property, Plant and Equipment [Table Text Block]Properties not held for sale
Property
Land
Buildings
Total
Accumulated
Depreciation
Biomat USA, Wichita, KS
$
507,489
$
1,277,436
$
1,784,925
$
817,485
Advance Auto Parts, Middletown, OH
18,854
557,744
576,598
494,098
Cellular Connection, Bluffton, IN
344,008
836,108
1,180,116
448,996
Best Buy, Eau Claire, WI
803,535
2,158,403
2,961,938
836,994
Fresenius Medical Center, Chicago, IL
464,400
665,142
1,129,542
159,626
Zales, Enid, OK
440,000
903,630
1,343,630
209,335
Dollar Tree, West Point, MS
270,000
1,316,232
1,586,232
258,854
$
2,848,286
$
7,714,695
$
10,562,981
$
3,225,388
Schedule of Acquired Finite-Lived Intangible Assets by Major Class [Table Text Block]Acquired lease intangibles not held for sale
2020
2019
Cost
Accumulated Amortization
Cost
Accumulated Amortization
In-Place Lease Intangibles
(weighted average life of 55 and 72 months, respectively)
$
735,546
$
382,390
$
735,546
$
268,246
Above-Market Lease Intangibles
(weighted average life of 46 and 58 months, respectively)
72,606
43,562
72,606
35,986
Acquired Intangible Lease Assets
$
808,152
$
425,952
$
808,152
$
304,232
Acquired Below-Market Lease Intangibles
(weighted average life of 57 and 69 months, respectively)
$
283,495
$
142,988
$
283,495
$
113,404
Finite-lived Intangible Assets Amortization Expense [Table Text Block]Estimated Amortization
Amortization Expense for
In-Place Lease Intangibles
Decrease to Rental Income
for Above-Market Leases
Increase to Rental Income
for Below-Market Leases
2021
$
81,384
$
7,576
$
29,584
2022
81,384
7,576
29,584
2023
63,716
7,576
29,584
2024
58,906
6,316
29,584
2025
36,842
0
22,171
$
322,232
$
29,044
$
140,507
Schedule of Future Minimum Rental Payments for Operating Leases [Table Text Block]Minimum future rent
2021
$
643,158
2022
645,729
2023
390,850
2024
352,122
2025
231,216
Thereafter
246,801
$
2,509,876

Major Tenants (Tables)

Major Tenants (Tables)12 Months Ended
Dec. 31, 2020
Accounting Policies [Abstract]
Schedule of Revenue by Major Customers by Reporting Segments [Table Text Block]Major Tenants
Tenants
2020
2019
Best Buy Stores, L.P.
$
240,427
$
204,421
Dollar Tree Stores, Inc.
137,084
137,084
Zale Delaware Inc.
108,584
99,784
Fresenius Medical Care of Illinois
100,336
97,889
Aggregate rental income of major tenants
$
586,431
$
539,178
Aggregate rental income of major tenants
as a percentage of total rental income
88%
75%

Income Taxes (Tables)

Income Taxes (Tables)12 Months Ended
Dec. 31, 2020
Income Tax Disclosure [Abstract]
Schedule Of GAAP To Federal Taxable IncomeReconciliation of net income for financial reporting
2020
2019
Net Income (Loss) for Financial Reporting Purposes
$
(30,601)
$
(768,915)
Depreciation for Tax Purposes Under Depreciation
and Amortization for Financial Reporting Purposes
130,726
76,399
Income Accrued for Tax Purposes Over (Under)
Income for Financial Reporting Purposes
(420)
420
Real Estate Impairment Loss
Not Recognized for Tax Purposes
78,376
1,277,928
Loss on Sale of Real Estate for Tax Purposes
Compared to Gain for Financial Reporting Purposes
0
(2,054,033)
Taxable Income to Members
$
178,081
$
(1,468,201)
Schedule Of GAAP To Federal Tax BasisReconciliation of Members’ Equity for financial reporting
2020
2019
Members’ Equity for Financial Reporting Purposes
$
8,805,487
$
9,213,817
Adjusted Tax Basis of Investments in Real Estate
Over Net Investments in Real Estate
for Financial Reporting Purposes
2,101,571
1,892,469
Income Accrued for Tax Purposes Over
Income for Financial Reporting Purposes
19,366
19,786
Syndication Costs Treated as Reduction
of Capital For Financial Reporting Purposes
2,691,997
2,691,997
Members’ Equity for Tax Reporting Purposes
$
13,618,421
$
13,818,069

Organization (Details)

Organization (Details) - USD ($)Dec. 31, 2020Dec. 31, 2019Dec. 31, 2018Oct. 19, 2007Apr. 03, 2006
Limited Partner [Member]
Organization (Details) [Line Items]
Capital Units, Value $ 10
Limited Partners' Capital Account, Units Outstanding (in Shares)1,738,006 1,738,006 1,738,006 1,832,736 150,000
Limited Partners' Contributed Capital $ 18,327,360 $ 1,500,000
General Partner [Member]
Organization (Details) [Line Items]
General Partners' Contributed Capital $ 1,000

Summary of Significant Accoun_2

Summary of Significant Accounting Policies (Details) - USD ($)3 Months Ended12 Months Ended
Dec. 31, 2020Sep. 30, 2019Jun. 30, 2019Mar. 31, 2019Dec. 31, 2020Dec. 31, 2019Dec. 31, 2018
Summary of Significant Accounting Policies (Details) [Line Items]
Impairment of Real Estate $ 78,376 $ 1,277,928
Deferred Rent Credit $ 19,360 19,360
Dicks Sporting Goods Fredericksburg VA
Summary of Significant Accounting Policies (Details) [Line Items]
Property, Plant and Equipment, Gross $ 1,583,623
Property, Plant, and Equipment, Fair Value Disclosure $ 661,500 $ 972,000 $ 972,000
Impairment of Real Estate $ 298,990 $ 611,623
Advance Auto Parts Middletown OH
Summary of Significant Accounting Policies (Details) [Line Items]
Property, Plant and Equipment, Gross $ 546,065
Property, Plant, and Equipment, Fair Value Disclosure82,500 178,750 $ 82,500
Impairment of Real Estate $ 78,376 $ 367,315

Related Party Transactions (Det

Related Party Transactions (Details) - Related Party Transactions - USD ($)12 Months Ended
Dec. 31, 2020Dec. 31, 2019
Related Party Transactions [Abstract]
AEI is reimbursed for costs incurred in providing services related to managing the Company’s operations and properties, maintaining the Company’s books, and communicating with the Limited Members. $ 108,100 $ 145,508
AEI is reimbursed for all direct expenses it paid on the Company’s behalf to third parties related to Company administration and property management. These expenses included printing costs, legal and filing fees, direct administrative costs, outside audit costs, taxes, insurance and other property costs.100,625 127,622
AEI is reimbursed for costs incurred in providing services and direct expenses related to the acquisition of property on behalf of the Company.0 1,850
AEI is reimbursed for costs incurred in providing services related to the sale of property on behalf of the Company. $ 0 $ 9,159

Real Estate Investments (Detail

Real Estate Investments (Details) - USD ($)Dec. 27, 2019Sep. 01, 2019Aug. 27, 2019Jun. 06, 2019Apr. 08, 2019Sep. 21, 2017Dec. 31, 2020Sep. 30, 2019Jun. 30, 2019Mar. 31, 2019Feb. 22, 2021Dec. 31, 2020Jun. 05, 2020Dec. 31, 2019Jun. 17, 2019Dec. 31, 2018
Real Estate Investments (Details) [Line Items]
Depreciation, Nonproduction $ 295,860 $ 317,780
Distributions Per Limited Partnership Unit Outstanding, Basic (in Dollars per share) $ 0.0527 $ 0.0949
Impairment of Real Estate78,376 $ 1,277,928
Gain (Loss) on Disposition of Assets0 438,664
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Accumulated Depreciation $ 3,225,388 3,225,388
Payments to Acquire Real Estate0 1,042,610
Dicks Sporting Goods Fredericksburg VA
Real Estate Investments (Details) [Line Items]
Disposal DateDec. 27,
2019
Proceeds from Sale of Real Estate $ 663,277
Gain (Loss) on Disposition of Assets1,777
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Cost of Investment in Real Estate Sold1,385,017
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Accumulated Depreciation $ 723,517
Applebees Crawfordsville IN
Real Estate Investments (Details) [Line Items]
Disposal DateApr. 8,
2019
Proceeds from Sale of Real Estate $ 1,242,457
Gain (Loss) on Disposition of Assets436,887
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Cost of Investment in Real Estate Sold1,237,771
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Accumulated Depreciation $ 432,201
Dicks Sporting Goods Fredericksburg VA
Real Estate Investments (Details) [Line Items]
Impairment of Real Estate $ 298,990 $ 611,623
Property, Plant, and Equipment, Fair Value Disclosure $ 661,500 $ 972,000 $ 972,000
Property, Plant and Equipment, Gross $ 1,583,623
Advance Auto Parts Middletown OH
Real Estate Investments (Details) [Line Items]
Impairment of Real Estate78,376 $ 367,315
Property, Plant, and Equipment, Fair Value Disclosure82,500 178,750 82,500
SEC Schedule, 12-28, Real Estate Companies, Investment in Real Estate, Accumulated Depreciation494,098 494,098
Property, Plant and Equipment, Gross $ 546,065
Leases, Acquired-in-Place [Member]
Real Estate Investments (Details) [Line Items]
Amortization of Intangible Assets114,144 71,746
Finite-Lived Intangible Asset, Acquired-in-Place Leases $ 735,546 735,546 735,546
Above Market Leases [Member]
Real Estate Investments (Details) [Line Items]
Amortization of above and below Market Leases7,576 7,576
Off Market Unfavorable Lease Member
Real Estate Investments (Details) [Line Items]
Amortization of Below Market Lease $ 29,584 $ 29,584
Biomat Wichita KS
Real Estate Investments (Details) [Line Items]
Average Lease TermOn September 21, 2017, the Company entered into a lease agreement with a primary term of 10 years with Biomat USA, Inc. (“Biomat”) as a replacement tenant for 28% of the square footage of the property.
Revenue from Contract with Customer, Excluding Assessed Tax $ 37,071
BigTime Fun Wichita KS
Real Estate Investments (Details) [Line Items]
Average Lease TermAugust 27, 2019, the Company entered into a lease agreement with a primary term of 10 years with BigTime Fun Center, LLC as a replacement tenant for 57% of the square footage of the property.
Revenue from Contract with Customer, Excluding Assessed Tax $ 78,000
Payments for Tenant Improvements $ 64,000
Payments for Lease Commissions $ 32,760
Best Buy Eau Claire WI
Real Estate Investments (Details) [Line Items]
Revenue from Contract with Customer, Excluding Assessed Tax $ 83,627
Business Acquisition, Effective Date of AcquisitionJun. 6,
2019
Payments to Acquire Real Estate $ 1,009,850
Best Buy Eau Claire WI | Leases, Acquired-in-Place [Member]
Real Estate Investments (Details) [Line Items]
Finite-Lived Intangible Asset, Acquired-in-Place Leases $ 69,074

Real Estate Investments (Deta_2

Real Estate Investments (Details) - Real Estate Held for InvestmentDec. 31, 2020USD ($)
Property, Plant and Equipment [Line Items]
Land $ 2,848,286
Buildings7,714,695
Total10,562,981
Accumulated Depreciation3,225,388
Biomat Wichita KS
Property, Plant and Equipment [Line Items]
Land507,489
Buildings1,277,436
Total1,784,925
Accumulated Depreciation817,485
Advance Auto Parts Middletown OH
Property, Plant and Equipment [Line Items]
Land18,854
Buildings557,744
Total576,598
Accumulated Depreciation494,098
Cellular Connection Bluffton IN
Property, Plant and Equipment [Line Items]
Land344,008
Buildings836,108
Total1,180,116
Accumulated Depreciation448,996
Best Buy Eau Claire WI
Property, Plant and Equipment [Line Items]
Land803,535
Buildings2,158,403
Total2,961,938
Accumulated Depreciation836,994
Fresenius Medical Center Chicago IL
Property, Plant and Equipment [Line Items]
Land464,400
Buildings665,142
Total1,129,542
Accumulated Depreciation159,626
Zales Enid OK
Property, Plant and Equipment [Line Items]
Land440,000
Buildings903,630
Total1,343,630
Accumulated Depreciation209,335
Dollar Tree West Point MS
Property, Plant and Equipment [Line Items]
Land270,000
Buildings1,316,232
Total1,586,232
Accumulated Depreciation $ 258,854

Real Estate Investments (Deta_3

Real Estate Investments (Details) - Acquired Lease Intangibles - USD ($)Dec. 31, 2020Dec. 31, 2019
Leases, Acquired-in-Place [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Cost $ 735,546 $ 735,546
Lease Intangibles Accumulated Amortization
Acquired Finite-Lived Intangible Assets [Line Items]
Accumulated Amortization382,390 268,246
Accumulated Amortization43,562 35,986
Accumulated Amortization425,952 304,232
Accumulated Amortization142,988 113,404
Above Market Leases [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Cost72,606 72,606
Cost808,152 808,152
Off Market Unfavorable Lease Member
Acquired Finite-Lived Intangible Assets [Line Items]
Cost $ 283,495 $ 283,495

Real Estate Investments (Deta_4

Real Estate Investments (Details) - Acquired Lease Intangibles (Parentheticals)12 Months Ended
Dec. 31, 2020Dec. 31, 2019
Leases, Acquired-in-Place [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted average life55 months72 months
Above Market Leases [Member]
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted average life46 months58 months
Off Market Unfavorable Lease Member
Acquired Finite-Lived Intangible Assets [Line Items]
Weighted average life57 months69 months

Real Estate Investments (Deta_5

Real Estate Investments (Details) - Estimated Amortization of Lease Intangibles - USD ($)Dec. 31, 2025Dec. 31, 2024Dec. 31, 2023Dec. 31, 2022Dec. 31, 2021
Leases, Acquired-in-Place [Member]
Real Estate Investments (Details) - Estimated Amortization of Lease Intangibles [Line Items]
Amortization Expense for In-Place Lease Intangibles $ 81,384
Amortization Expense for In-Place Lease Intangibles $ 81,384
Amortization Expense for In-Place Lease Intangibles $ 63,716
Amortization Expense for In-Place Lease Intangibles $ 58,906
Amortization Expense for In-Place Lease Intangibles $ 36,842
Amortization Expense for In-Place Lease Intangibles322,232
Above Market Leases [Member]
Real Estate Investments (Details) - Estimated Amortization of Lease Intangibles [Line Items]
Decrease to Rental Income for Above-Market Leases7,576
Decrease to Rental Income for Above-Market Leases7,576
Decrease to Rental Income for Above-Market Leases7,576
Decrease to Rental Income for Above-Market Leases6,316
Decrease to Rental Income for Above-Market Leases0
Decrease to Rental Income for Above-Market Leases29,044
Off Market Unfavorable Lease Member
Real Estate Investments (Details) - Estimated Amortization of Lease Intangibles [Line Items]
Increase to Rental Income for Below-Market Leases $ 29,584
Increase to Rental Income for Below-Market Leases $ 29,584
Increase to Rental Income for Below-Market Leases $ 29,584
Increase to Rental Income for Below-Market Leases $ 29,584
Increase to Rental Income for Below-Market Leases22,171
Increase to Rental Income for Below-Market Leases $ 140,507

Real Estate Investments (Deta_6

Real Estate Investments (Details) - Future Minimum Rent - USD ($)Dec. 31, 2025Dec. 31, 2024Dec. 31, 2023Dec. 31, 2022Dec. 31, 2021
Future Minimum Rent [Abstract]
2021 $ 643,158
2022 $ 645,729
2023 $ 390,850
2024 $ 352,122
2025 $ 231,216
Thereafter246,801
$ 2,509,876

Major Tenants (Details) - Major

Major Tenants (Details) - Major Tenants - USD ($)12 Months Ended
Dec. 31, 2020Dec. 31, 2019
Revenue, Major Customer [Line Items]
Major Tenants $ 586,431 $ 539,178
Aggregate rental income of major tenants as a percentage of total rental income88.00%75.00%
Best Buy Stores LP
Revenue, Major Customer [Line Items]
Major Tenants $ 240,427 $ 204,421
Dollar Tree Stores Inc
Revenue, Major Customer [Line Items]
Major Tenants137,084 137,084
Zales Delaware Inc
Revenue, Major Customer [Line Items]
Major Tenants108,584 99,784
Fresenius Medical Care of Illinois
Revenue, Major Customer [Line Items]
Major Tenants $ 100,336 $ 97,889

Members' Equity (Details)

Members' Equity (Details)12 Months Ended
Dec. 31, 2020USD ($)$ / sharessharesDec. 31, 2019USD ($)$ / shares$ / itemshares
Members' Equity (Details) [Line Items]
Distribution Made to Limited Partner, Cash Distributions Declared $ 377,729 $ 377,730
Limited Partner [Member]
Members' Equity (Details) [Line Items]
Distribution Made to Limited Partner, Cash Distributions Declared $ 366,397 $ 366,398
Distribution Made to Limited Partner, Distributions Declared, Per Unit (in Dollars per share) | $ / shares $ 0.21 $ 0.21
Weighted Average Limited Partnership Units Outstanding, Basic (in Shares) | shares1,738,006 1,738,006
DistributionsPerUnitOfNetIncome (in Dollars per Share) | $ / shares0 0
DistributionsPerUnitOfReturnOfCapital (in Dollars per Share)0.210.21
General Partner [Member]
Members' Equity (Details) [Line Items]
Distribution Made to Limited Partner, Cash Distributions Declared $ 11,332 $ 11,332

Income Taxes (Details) - Federa

Income Taxes (Details) - Federal Taxable Income Reconciliation - USD ($)12 Months Ended
Dec. 31, 2020Dec. 31, 2019
Federal Taxable Income Reconciliation [Abstract]
Net Income (Loss) for Financial Reporting Purposes $ (30,601) $ (768,915)
Depreciation for Tax Purposes Under Depreciation and Amortization for Financial Reporting Purposes130,726 76,399
Income Accrued for Tax Purposes Over (Under) Income for Financial Reporting Purposes(420)420
Real Estate Impairment Loss Not Recognized for Tax Purposes78,376 1,277,928
Loss on Sale of Real Estate for Tax Purposes Compared to Gain for Financial Reporting Purposes0 (2,054,033)
Taxable Income to Members $ 178,081 $ (1,468,201)

Income Taxes (Details) - Fede_2

Income Taxes (Details) - Federal Tax Members' Equity - USD ($)12 Months Ended
Dec. 31, 2020Dec. 31, 2019
Federal Tax Members' Equity [Abstract]
Members’ Equity for Financial Reporting Purposes $ 8,805,487 $ 9,213,817
Adjusted Tax Basis of Investments in Real Estate Over Net Investments in Real Estate for Financial Reporting Purposes2,101,571 1,892,469
Income Accrued for Tax Purposes Over Income for Financial Reporting Purposes19,366 19,786
Syndication Costs Treated as Reduction of Capital For Financial Reporting Purposes2,691,997 2,691,997
Members’ Equity for Tax Reporting Purposes $ 13,618,421 $ 13,818,069