Cover Page
Cover Page - shares | 6 Months Ended | |
Jun. 30, 2022 | Aug. 10, 2022 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2022 | |
Document Transition Report | false | |
Entity File Number | 000-54382 | |
Entity Registrant Name | PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC. | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 26-3842535 | |
Entity Address, Address Line One | 11766 Wilshire Blvd., Suite 1670 | |
Entity Address, City or Town | Los Angeles, | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 90025 | |
City Area Code | 424 | |
Local Phone Number | 208-8100 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 104,140,141 | |
Entity Central Index Key | 0001452936 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Assets | ||
Real estate held for investment, net | $ 1,194,479 | $ 1,209,243 |
Real estate held for sale, net | 0 | 5,556 |
Real estate equity securities | 84,505 | 112,096 |
Total real estate and real estate-related investments, net | 1,278,984 | 1,326,895 |
Cash and cash equivalents | 104,389 | 84,172 |
Restricted cash | 62,406 | 21,259 |
Investments in unconsolidated entities | 107,339 | 88,256 |
Rents and other receivables, net | 23,220 | 21,795 |
Above-market leases, net | 2,455 | 2,642 |
Due from affiliate | 1,792 | 7,039 |
Prepaid expenses and other assets | 19,336 | 18,108 |
Goodwill | 13,534 | 13,534 |
Assets related to real estate held for sale, net | 0 | 919 |
Total assets | 1,613,455 | 1,584,619 |
Liabilities, mezzanine equity and equity | ||
Notes and bonds payable related to real estate held for investment, net | 1,040,029 | 989,879 |
Note payable related to real estate held for sale, net | 0 | 9,070 |
Notes and bonds payable, net | 1,040,029 | 998,949 |
Accounts payable and accrued liabilities | 24,595 | 23,852 |
Due to affiliates | 12,343 | 1,903 |
Below-market leases, net | 3,385 | 4,080 |
Other liabilities | 54,610 | 43,513 |
Redeemable common stock payable | 1,379 | 684 |
Restricted stock payable | 508 | 508 |
Dividends payable | 0 | 11,016 |
Total liabilities | 1,136,849 | 1,084,505 |
Commitments and contingencies | ||
Mezzanine equity | ||
Noncontrolling cumulative convertible redeemable preferred stock | 15,233 | 15,233 |
Redeemable noncontrolling interest | 0 | 2,822 |
Equity | ||
Preferred stock, $.01 par value; 10,000,000 shares authorized, no shares issued and outstanding | 0 | 0 |
Common stock, $.01 par value; 1,000,000,000 shares authorized, 104,319,092 and 94,141,251 shares issued and outstanding as of June 30, 2022 and December 31, 2021, respectively | 1,043 | 941 |
Additional paid-in capital | 914,463 | 818,440 |
Cumulative distributions and net loss | (464,506) | (347,691) |
Total Pacific Oak Strategic Opportunity REIT, Inc. stockholders’ equity | 451,000 | 471,690 |
Noncontrolling interests | 10,373 | 10,369 |
Total equity | 461,373 | 482,059 |
Total liabilities, mezzanine equity and equity | $ 1,613,455 | $ 1,584,619 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Jun. 30, 2022 | Dec. 31, 2021 |
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 |
Common stock, shares issued (in shares) | 104,319,092 | 94,141,251 |
Common stock, shares outstanding (in shares) | 104,319,092 | 94,141,251 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues: | ||||
Rental income | $ 28,979 | $ 32,670 | $ 58,360 | $ 65,378 |
Dividend income from real estate equity securities | 819 | 751 | 3,206 | 3,504 |
Total revenues | 43,539 | 44,488 | 82,065 | 83,430 |
Expenses: | ||||
Operating, maintenance, and management | 10,342 | 10,342 | 20,218 | 20,775 |
Real estate taxes and insurance | 5,079 | 5,399 | 10,103 | 10,688 |
Hotel expenses | 6,998 | 5,841 | 12,109 | 9,233 |
Asset management fees to affiliate | 3,189 | 3,527 | 6,315 | 7,380 |
General and administrative expenses | 2,983 | 2,888 | 5,977 | 4,759 |
Foreign currency transaction (gain) loss, net | (23,833) | 5,507 | (31,098) | (2,839) |
Depreciation and amortization | 14,098 | 15,072 | 26,662 | 32,073 |
Interest expense | 10,780 | 10,680 | 20,343 | 20,618 |
Total expenses | 29,636 | 59,256 | 70,629 | 102,687 |
Other (loss) income: | ||||
Equity in (loss) income of unconsolidated entities | (2,075) | 256 | (2,754) | 425 |
Other interest income | 48 | 48 | 94 | 94 |
(Loss) gain on real estate equity securities | (20,070) | 4,800 | (27,591) | 15,553 |
Change in subordinated performance fee due upon termination to affiliate | 0 | 261 | 0 | (200) |
(Loss) gain on sale of real estate | (175) | 31,148 | 3,348 | 31,170 |
Gain on extinguishment of debt | 0 | 13 | 2,367 | 13 |
Total other (loss) income, net | (22,272) | 36,526 | (24,536) | 47,055 |
Net (loss) income | (8,369) | 21,758 | (13,100) | 27,798 |
Net (income) loss attributable to noncontrolling interests | (156) | 98 | (38) | 761 |
Net loss attributable to redeemable noncontrolling interest | 34 | 49 | 81 | 81 |
Preferred stock dividends | $ (528) | (230) | (718) | (453) |
Net (loss) income attributable to common stockholders | $ 21,675 | $ (13,775) | $ 28,187 | |
Net (loss) income per common share, basic (in dollars per share) | $ (0.09) | $ 0.22 | $ (0.13) | $ 0.29 |
Net (loss) income per common share, diluted (in dollars per share) | $ (0.09) | $ 0.22 | $ (0.13) | $ 0.29 |
Weighted-average number of common shares outstanding, basic (in shares) | 104,422,035 | 97,948,219 | 102,929,284 | 97,991,934 |
Weighted-average number of common shares outstanding, diluted (in shares) | 104,422,035 | 97,948,219 | 102,929,284 | 97,991,934 |
Hotel | ||||
Revenues: | ||||
Revenue from contract with customer | $ 12,854 | $ 9,849 | $ 18,771 | $ 12,424 |
Other operating income | ||||
Revenues: | ||||
Revenue from contract with customer | $ 887 | $ 1,218 | $ 1,728 | $ 2,124 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) $ in Thousands | Total | Total Stockholders' Equity | Common Stock | Additional Paid-in Capital | Cumulative Distributions and Net Income (Loss) | Noncontrolling Interests |
Balance (in shares) at Dec. 31, 2020 | 98,054,582 | |||||
Balance at Dec. 31, 2020 | $ 519,712 | $ 506,554 | $ 979 | $ 831,295 | $ (325,720) | $ 13,158 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | 27,426 | 28,187 | 28,187 | (761) | ||
Transfers to redeemable common stock | (565) | (565) | (565) | |||
Redemptions of common stock (in shares) | (148,314) | |||||
Redemptions of common stock | (1,436) | (1,436) | (1,436) | |||
Noncontrolling interests contributions | 163 | 163 | ||||
Balance (in shares) at Jun. 30, 2021 | 97,906,268 | |||||
Balance at Jun. 30, 2021 | 545,300 | 532,740 | $ 979 | 829,294 | (297,533) | 12,560 |
Balance (in shares) at Mar. 31, 2021 | 97,966,439 | |||||
Balance at Mar. 31, 2021 | 525,581 | 513,066 | $ 979 | 831,295 | (319,208) | 12,515 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | 21,577 | 21,675 | 21,675 | (98) | ||
Transfers to redeemable common stock | (1,419) | (1,419) | (1,419) | |||
Redemptions of common stock (in shares) | (60,171) | |||||
Redemptions of common stock | (582) | (582) | (582) | |||
Noncontrolling interests contributions | 143 | 143 | ||||
Balance (in shares) at Jun. 30, 2021 | 97,906,268 | |||||
Balance at Jun. 30, 2021 | $ 545,300 | 532,740 | $ 979 | 829,294 | (297,533) | 12,560 |
Balance (in shares) at Dec. 31, 2021 | 94,141,251 | 94,141,251 | ||||
Balance at Dec. 31, 2021 | $ 482,059 | 471,690 | $ 941 | 818,440 | (347,691) | 10,369 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | (13,737) | (13,775) | (13,775) | 38 | ||
Transfers to redeemable common stock | (695) | (695) | (695) | |||
Redemptions of common stock (in shares) | (242,336) | |||||
Redemptions of common stock | (2,274) | (2,274) | $ (2) | (2,272) | ||
Adjustment to value of redeemable noncontrolling interest | (3,946) | (3,946) | (3,946) | |||
Stock distribution issued (in shares) | 10,420,177 | |||||
Stock distribution issued | 0 | 0 | $ 104 | 98,990 | (99,094) | |
Noncontrolling interest distribution | $ (34) | (34) | ||||
Balance (in shares) at Jun. 30, 2022 | 104,319,092 | 104,319,092 | ||||
Balance at Jun. 30, 2022 | $ 461,373 | 451,000 | $ 1,043 | 914,463 | (464,506) | 10,373 |
Balance (in shares) at Mar. 31, 2022 | 104,496,165 | |||||
Balance at Mar. 31, 2022 | 471,986 | 461,735 | $ 1,045 | 914,460 | (453,770) | 10,251 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net (loss) income | (8,863) | (9,019) | (9,019) | 156 | ||
Transfers to redeemable common stock | 1,685 | 1,685 | 1,685 | |||
Redemptions of common stock (in shares) | (177,171) | |||||
Redemptions of common stock | (1,685) | (1,685) | $ (2) | (1,683) | ||
Adjustment to value of redeemable noncontrolling interest | (1,716) | (1,716) | (1,716) | |||
Stock distribution issued (in shares) | 98 | |||||
Stock distribution issued | 0 | 0 | 1 | (1) | ||
Noncontrolling interest distribution | $ (34) | (34) | ||||
Balance (in shares) at Jun. 30, 2022 | 104,319,092 | 104,319,092 | ||||
Balance at Jun. 30, 2022 | $ 461,373 | $ 451,000 | $ 1,043 | $ 914,463 | $ (464,506) | $ 10,373 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Cash Flows from Operating Activities: | |||||
Net (loss) income | $ (8,369) | $ 21,758 | $ (13,100) | $ 27,798 | |
Adjustments to reconcile net (loss) income to net cash provided by operating activities: | |||||
Change in subordinated performance fee due upon termination to affiliate | 0 | (261) | 0 | 200 | |
Equity in loss (income) of unconsolidated entities | 2,754 | (425) | |||
Depreciation and amortization | 14,098 | 15,072 | 26,662 | 32,073 | |
Loss (gain) on real estate equity securities | 20,070 | (4,800) | 27,591 | (15,553) | |
Gain on sale of real estate | 175 | (31,148) | (3,348) | (31,170) | |
Unrealized (gain) loss on interest rate caps | (270) | 16 | |||
Deferred rent | (1,427) | (1,113) | |||
Gain on extinguishment of debt | 0 | (13) | (2,367) | (13) | |
Amortization of above- and below-market leases, net | (508) | (720) | |||
Amortization of deferred financing costs and discount on bonds and notes payable | 3,844 | 3,023 | |||
Foreign currency transaction gain, net | (23,833) | 5,507 | (31,098) | (2,839) | |
Changes in assets and liabilities: | |||||
Rents and other receivables | (175) | 791 | |||
Prepaid expenses and other assets | (1,150) | (1,206) | |||
Accounts payable and accrued liabilities | 502 | (1,400) | |||
Due to affiliates | 3,753 | (1,601) | |||
Other liabilities | 668 | 749 | |||
Net cash provided by operating activities | 12,331 | 8,610 | |||
Cash Flows from Investing Activities: | |||||
Acquisitions of real estate | 0 | (4,107) | |||
Improvements to real estate | (10,110) | (7,727) | |||
Proceeds from sales of real estate, net | 357 | 49,662 | |||
Contributions to unconsolidated entities | (22,500) | (4,024) | |||
Distributions of capital from unconsolidated entities | 569 | 0 | |||
Purchase of interest rate cap | (506) | (18) | |||
Proceeds from the sale of real estate equity securities | 0 | 14,439 | |||
Advance to affiliate | (1,201) | ||||
Proceeds from advances due from affiliates | 6,448 | 0 | |||
Escrow deposits for future real estate sales | 17,000 | 0 | |||
Proceeds for future development obligations | 0 | 6,203 | |||
Funding for development obligations | (4,025) | 0 | |||
Net cash (used in) provided by investing activities | (13,968) | 54,428 | |||
Cash Flows from Financing Activities: | |||||
Proceeds from notes and bonds payable | 145,104 | 157,246 | |||
Principal payments on notes and bonds payable | (61,613) | (131,672) | |||
Payments of deferred financing costs | (2,829) | (2,133) | |||
Payments to redeem common stock | (2,274) | (1,436) | |||
Payment of prepaid other offering costs | 0 | (111) | |||
Distributions paid | (11,016) | 0 | |||
Preferred dividends paid | (718) | (453) | |||
Noncontrolling interests distribution | (34) | 0 | |||
Noncontrolling interests contributions | 0 | 163 | |||
Other financing proceeds | 0 | 2,367 | |||
Net cash provided by financing activities | 66,620 | 23,971 | |||
Effect of exchange rate changes on cash, cash equivalents and restricted cash | (3,619) | (310) | |||
Net increase in cash, cash equivalents and restricted cash | 61,364 | 86,699 | |||
Cash, cash equivalents and restricted cash, beginning of period | 105,431 | 74,319 | $ 74,319 | ||
Cash, cash equivalents and restricted cash, end of period | $ 166,795 | $ 161,018 | $ 166,795 | $ 161,018 | $ 105,431 |
ORGANIZATION
ORGANIZATION | 6 Months Ended |
Jun. 30, 2022 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION | ORGANIZATIONPacific Oak Strategic Opportunity REIT, Inc. (the “Company”) was formed on October 8, 2008 as a Maryland corporation and elected to be taxed as a real estate investment trust (“REIT”) beginning with the taxable year ended December 31, 2010. The Company conducts its business primarily through Pacific Oak SOR (BVI) Holdings, Ltd. (“Pacific Oak SOR BVI”), a private company limited by shares according to the British Virgin Islands Business Companies Act, 2004, which was incorporated on December 18, 2015 and is authorized to issue a maximum of 50,000 common shares with no par value. Upon incorporation, Pacific Oak SOR BVI issued one certificate containing 10,000 common shares with no par value to Pacific Oak Strategic Opportunity Limited Partnership (the “Operating Partnership”), a Delaware limited partnership formed on December 10, 2008. The Company is the sole general partner of, and owns a 0.1% partnership interest in, the Operating Partnership. Pacific Oak Strategic Opportunity Holdings LLC (“REIT Holdings”), a Delaware limited liability company formed on December 9, 2008, owns the remaining 99.9% interest in the Operating Partnership and is its sole limited partner. The Company is the sole member and manager of REIT Holdings. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES There have been no significant changes to the Company’s accounting policies since it filed its audited financial statements in its Annual Report on Form 10-K for the year ended December 31, 2021. For further information about the Company’s accounting policies, refer to the Company’s consolidated financial statements and notes thereto for the year ended December 31, 2021 included in the Company’s Annual Report on Form 10-K filed with the SEC. Principles of Consolidation and Basis of Presentation The accompanying unaudited consolidated financial statements and condensed notes thereto have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the FASB Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022. The consolidated financial statements include the accounts of the Company, REIT Holdings, the Operating Partnership, Pacific Oak SOR BVI and their direct and indirect wholly owned subsidiaries, joint ventures in which the Company has a controlling interest and VIEs in which the Company is the primary beneficiary. All significant intercompany balances and transactions are eliminated in consolidation. Liquidity The Company generally finances its real estate investments using notes payable that are typically structured as non-recourse secured mortgages with maturities of approximately three Reclassifications Certain prior period amounts have been reclassified to conform to the current period presentation. In that regard, the Company reclassified held for sale activity related to dispositions in its consolidated balance sheets as of December 31, 2021. Use of Estimates The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates. Restricted Cash Restricted cash is comprised of escrow deposits for future real estate sales and lender impound reserve accounts on the Company’s borrowings for security deposits, property taxes, insurance, debt service obligations and capital improvements and replacements. Segments The Company operates in three reportable business segments: opportunistic real estate and real estate-related investments, single-family homes, and hotels, which is how the Company’s management manages the business. In general, the Company intends to hold its investments in opportunistic real estate and other real estate-related assets for capital appreciation. Traditional performance metrics of opportunistic real estate and other real estate-related assets may not be meaningful as these investments are generally non-stabilized and do not provide a consistent stream of interest income or rental revenue. These investments exhibit similar long-term financial performance and have similar economic characteristics. These investments typically involve a higher degree of risk and do not provide a constant stream of ongoing cash flows. As a result, the Company’s management views opportunistic real estate and other real estate-related assets as similar investments and aggregated them into one reportable business segment. The Company owns single-family homes in 18 markets which are all aggregated into one reportable business segment due to the homes being stabilized, having high occupancy rates and have similar economic characteristics. Additionally, the Company owns two hotels which are aggregated into one reportable business segment due to the nature of the hotel business with short-term stays. Per Share Data The Company determines basic earnings per share and basic earnings per unit based on the weighted average number of shares of common stock or units, as applicable, outstanding during the period and the Company considers any participating securities, including unvested restricted stock, for purposes of applying the two-class method. The Company determines diluted earnings per share and diluted earnings per unit based on the weighted average number of shares of common stock or units, as applicable, outstanding combined with the incremental weighted average number of shares or units, as applicable, that would have been outstanding assuming all potentially dilutive securities were converted into shares of common stock or units, as applicable, at the earliest date possible. The noncontrolling Series A convertible redeemable preferred shares of Pacific Oak Residential Trust, Inc. (“PORT”) were not included as the shares are contingent on PORT being public. Square Footage, Occupancy and Other Measures Any references to square footage, occupancy or annualized base rent are unaudited and outside the scope of the Company’s independent registered public accounting firm’s review of the Company’s financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board. |
REAL ESTATE HELD FOR INVESTMENT
REAL ESTATE HELD FOR INVESTMENT | 6 Months Ended |
Jun. 30, 2022 | |
Real Estate [Abstract] | |
REAL ESTATE HELD FOR INVESTMENT | REAL ESTATE HELD FOR INVESTMENT As of June 30, 2022, the Company owned eight office properties, one office portfolio consisting of two office buildings and 14 acres of undeveloped land, encompassing, in the aggregate, approximately 3.2 million rentable square feet. As of June 30, 2022, these properties were 72% occupied. In addition, the Company owned one residential home portfolio consisting of 1,815 single-family homes and encompassing approximately 2.5 million rental square feet and two apartment properties, containing 609 units and encompassing approximately 0.5 million rentable square feet, which were 92% and 92% occupied, respectively, as of June 30, 2022. As of June 30, 2022, the Company also owned two hotel properties with an aggregate of 649 rooms and three investments in undeveloped land with approximately 800 developable acres and one office/retail development property. The following table summarizes the Company’s real estate held for investment as of June 30, 2022 and December 31, 2021, respectively (in thousands): June 30, 2022 December 31, 2021 Land $ 277,513 $ 275,683 Buildings and improvements 1,026,110 1,017,465 Tenant origination and absorption costs 38,935 43,375 Total real estate, cost 1,342,558 1,336,523 Accumulated depreciation and amortization (148,079) (127,280) Total real estate, net $ 1,194,479 $ 1,209,243 Operating Leases Certain of the Company’s real estate properties are leased to tenants under operating leases for which the terms and expirations vary. As of June 30, 2022, the leases, excluding options to extend, apartment leases and single-family homes, which have terms that are generally one year or less, had remaining terms of up to 13.2 years with a weighted-average remaining term of 3.7 years. Some of the leases have provisions to extend the lease agreements, options for early termination after paying a specified penalty and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires a security deposit from tenants in the form of a cash deposit and/or a letter of credit. The amount required as a security deposit varies depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash and assumed in real estate acquisitions related to tenant leases are included in other liabilities in the accompanying consolidated balance sheets totaled $6.1 million and $6.0 million as of June 30, 2022 and December 31, 2021, respectively. During the three and six months ended June 30, 2022, the Company recognized deferred rent from tenants of $0.4 million and $1.4 million, respectively, net of lease incentive amortization. During the three and six months ended June 30, 2021, the Company recognized deferred rent from tenants of $0.03 million and $1.1 million, respectively, net of lease incentive amortization. As of June 30, 2022 and December 31, 2021, the cumulative deferred rent receivable balance, including unamortized lease incentive receivables, was $17.0 million and $16.3 million, respectively, and is included in rents and other receivables on the accompanying consolidated balance sheets. The cumulative deferred rent balance included $2.8 million and $3.3 million of unamortized lease incentives as of June 30, 2022 and December 31, 2021, respectively. As of June 30, 2022, the future minimum rental income from the Company’s properties, excluding apartment leases and single-family homes, under non-cancelable operating leases was as follows (in thousands): July 1, 2022 through December 31, 2022 $ 30,337 2023 56,342 2024 50,498 2025 39,743 2026 27,742 Thereafter 66,722 $ 271,384 As of June 30, 2022, the Company’s commercial real estate properties were leased to approximately 300 tenants over a diverse range of industries and geographic areas. The Company’s highest tenant industry concentrations (greater than 10% of annualized base rent) were as follows: Industry Number of Tenants Annualized Base Rent (1) (in thousands) Percentage of Professional, Scientific, and Technical Services 41 $ 7,837 12.4 % Public Administration 13 7,720 12.3 % Computer Systems Design and Related Services 31 7,567 12.0 % $ 23,124 36.7 % _____________________ (1) Annualized base rent represents annualized contractual base rental income as of June 30, 2022, adjusted to straight-line any contractual tenant concessions (including free rent), rent increases and rent decreases from the lease’s inception through the balance of the lease term. Geographic Concentration Risk As of June 30, 2022, the Company’s real estate investments in California and Georgia represented 21.6% and 10.0%, respectively, of the Company’s total assets. As a result, the geographic concentration of the Company’s portfolio makes it particularly susceptible to adverse economic developments in the California and Georgia real estate markets. Any adverse economic or real estate developments in these markets, such as business layoffs or downsizing, industry slowdowns, relocations of businesses, changing demographics and other factors, or any decrease in demand for office space resulting from the local business climate, could adversely affect the Company’s operating results and its ability to make distributions to stockholders. Hotel Properties The following table provides detailed information regarding the Company’s hotel revenues for its two hotel properties during the three and six months ended June 30, 2022 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Hotel revenues: Room $ 9,905 $ 7,439 $ 14,200 $ 9,112 Food, beverage and convention services 309 1,082 589 1,378 Campground 1,603 269 2,395 512 Other 1,037 1,059 1,587 1,422 Hotel revenues $ 12,854 $ 9,849 $ 18,771 $ 12,424 Contract Liabilities The following table summarizes the Company’s contract liabilities, which are comprised of hotel advanced deposits and deferred proceeds from historical and future land sales received from the buyers of the Park Highlands land sales (discussed below) and another developer for the value of land that was contributed to a master association that is consolidated by the Company, which are included in other liabilities in the accompanying consolidated balance sheets, as of June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 December 31, 2021 Contract liability $ 24,081 $ 7,313 Revenue recognized in the period from: Amounts included in contract liability at the beginning of the period $ 373 $ 159 Recent Real Estate Sale On January 24, 2022, the Company, through an indirect wholly owned subsidiary, sold two office buildings related to the Richardson Portfolio and containing 141,950 rentable square feet in Richardson, Texas (“Greenway Buildings”) to a purchaser unaffiliated with the Company or the Advisor (as defined in Note 7), for $11.0 million, before closing costs and credits. The carrying value of the Greenway Buildings as of the disposition date was $5.6 million, which was net of $3.2 million of accumulated depreciation and amortization. In connection with the sale of the Greenway Buildings, the Company repaid $9.1 million of the outstanding principal balance due under the mortgage loan secured by the Greenway Buildings. The Company recognized a gain on sale of $3.6 million related to the disposition of the Greenway Buildings, net of closing costs and adjustments. As a result of the sale of the Greenway Buildings, certain assets and liabilities were reclassified to held for sale on the consolidated balance sheets as of December 31, 2021. Park Highlands Land Purchase and Sale Contracts The Company enters into land purchase and sale contracts to dispose of Park Highlands developed and undeveloped land. Under these contracts, the Company will receive a stated deposit from the buyer, held in escrow, in consideration for the right, but not the obligation, to purchase the land at a future point in time with predetermined terms. After a contractually specified date, the deposits are not refundable even in the event the contract terminates, at which point the Company records restricted cash and other liabilities on the consolidated balance sheets. On November 11, 2021, the Company, through an indirect wholly owned subsidiary, entered into a purchase and sale agreement, as amended, to sell 234 (previously 238 and amended to reduce by 4 acres) developable acres of undeveloped land located in North Las Vegas, Nevada, (“Park Highlands”) for gross sales proceeds of approximately $124.5 million, before closing costs and credits. The due diligence period expired on February 23, 2022 and the buyer’s deposit of $13.5 million is no longer refundable and is recognized as restricted cash on the consolidated balance sheets. This deposit is held in an escrow account and will become available once the sale is completed. Actions are required by the Company to complete the planned sale. On March 10, 2022, the Company, through an indirect wholly owned subsidiary, entered into a purchase and sale agreement, as amended, to sell 77 developable acres of Park Highlands for gross sales proceeds of approximately $52.9 million, before closing costs and credits. The due diligence period expired on May 31, 2022 and the buyer’s deposit of $3.5 million is no longer refundable and is recognized as restricted cash on the consolidated balance sheets. This deposit is held in an escrow account and will become available once the sale is completed. Actions are required by the Company to complete the planned sale. On June 22, 2022, the Company, through an indirect wholly owned subsidiary, entered into a purchase and sale agreement, to sell 67 developable acres of Park Highlands for gross sales proceeds of approximately $55.0 million, before closing costs and credits. The due diligence period expires on October 20, 2022, after which the buyer’s deposit of $3.0 million will no longer be refundable and will be recognized as restricted cash on the consolidated balance sheets. This deposit is held in an escrow account and will become available once the sale is completed. Actions are required by the Company to complete the planned sale. |
REAL ESTATE EQUITY SECURITIES
REAL ESTATE EQUITY SECURITIES | 6 Months Ended |
Jun. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
REAL ESTATE EQUITY SECURITIES | REAL ESTATE EQUITY SECURITIES The following summarizes the portion of gain and loss for the period related to real estate equity securities held during the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Net (loss) gain recognized during the period on real estate equity securities $ (20,070) $ 4,800 $ (27,591) $ 15,553 Less net gain recognized during the period on real estate equity securities sold during the period — — — (225) Unrealized (loss) gain recognized during the reporting period on real estate equity securities held at the end of the period $ (20,070) $ 4,800 $ (27,591) $ 15,328 |
NOTES AND BONDS PAYABLE
NOTES AND BONDS PAYABLE | 6 Months Ended |
Jun. 30, 2022 | |
Notes and Bonds Payable [Abstract] | |
NOTES AND BONDS PAYABLE | NOTES AND BONDS PAYABLE As of June 30, 2022 and December 31, 2021, the Company’s notes and bonds payable, including notes payable related to real estate held for sale, consisted of the following (dollars in thousands): Book Value as of June 30, 2022 Book Value as of December 31, 2021 Contractual Interest Rate as of June 30, 2022 Effective Interest Rate at June 30, 2022 (1) Payment Type (2) Maturity Date (3) Richardson Portfolio Mortgage Loan $ 19,055 $ 28,470 Floating Rate + 2.50% 4.30% Principal & Interest 11/01/2022 Park Centre Mortgage Loan 26,185 26,185 Floating Rate + 1.75% 3.55% Interest Only 06/27/2023 1180 Raymond Mortgage Loan (4) 31,070 31,070 Floating Rate + 2.25% 3.83% Interest Only 12/01/2023 Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures (5) 333,356 271,978 3.93% 3.93% (5) 01/31/2026 Crown Pointe Mortgage Loan 53,758 52,315 Floating Rate + 2.30% 3.80% Interest Only 04/01/2025 The Marq Mortgage Loan 61,556 61,874 Floating Rate + 1.55% 3.35% Principal & Interest 06/06/2023 Eight & Nine Corporate Centre Mortgage Loan 48,295 48,545 Floating Rate + 1.60% 3.40% Principal & Interest 06/08/2023 Georgia 400 Center Mortgage Loan 61,154 61,154 Floating Rate + 1.55% 3.35% Interest Only 05/22/2023 PORT Mortgage Loan 1 51,303 51,302 4.74% 4.74% Interest Only 10/01/2025 PORT Mortgage Loan 2 10,523 10,523 4.72% 4.72% Interest Only 03/01/2026 PORT MetLife Loan 60,000 60,000 3.90% 3.90% Interest Only 04/10/2026 Springmaid Beach Resort Mortgage Loan 53,054 55,491 Floating Rate + 2.25% (6) 5.75% Principal & Interest 08/12/2022 (7) Q&C Hotel Mortgage Loan 24,904 25,000 Floating Rate + 2.50% (8) 4.50% Principal & Interest 12/23/2022 Lincoln Court Mortgage Loan (4) 32,491 34,623 Floating Rate + 2.25% 4.05% Principal & Interest 08/1/2022 (9) Lofts at NoHo Commons Mortgage Loan 74,536 74,536 Floating Rate + 2.18% (10) 3.98% Interest Only 09/09/2022 210 West 31st Street Mortgage Loan (4) 6,000 8,850 Floating Rate + 3.00% 4.80% Principal & Interest 06/16/2022 (11) Oakland City Center Mortgage Loan 95,415 96,075 Floating Rate + 1.75% 3.55% Principal & Interest 09/01/2022 Madison Square Mortgage Loan 17,649 17,500 4.63% 4.63% Interest Only 10/07/2024 Total Notes and Bonds Payable principal outstanding 1,060,304 1,015,491 Discount on Notes and Bonds Payable, net (12) (9,636) (8,146) Deferred financing costs, net (10,639) (8,396) Total Notes and Bonds Payable, net $ 1,040,029 $ 998,949 _____________________ (1) Contractual interest rate represents the interest rate in effect under the loan as of June 30, 2022. Effective interest rate is calculated as the actual interest rate in effect as of June 30, 2022 (consisting of the contractual interest rate and contractual floor rates), using interest rate indices at June 30, 2022, where applicable. (2) Represents the payment type required under the loan as of June 30, 2022. Certain future monthly payments due under this loan also include amortizing principal payments. For more information of the Company’s contractual obligations under its notes and bonds payable, see five-year maturity table below. (3) Represents the initial maturity date or the maturity date as extended as of June 30, 2022; subject to certain conditions, the maturity dates of certain loans may be extended beyond the date shown. (4) The Company’s notes and bond’s payable are generally non-recourse. These mortgage loans have guarantees over certain balances whereby the Company would be required to make guaranteed payments in the event that the Company turned the property over to the lender. The guarantees are typically 25% of the outstanding loan balance. As of June 30, 2022, the guaranteed amount in the aggregate was $21.9 million. (5) See “Israeli Bond Financings” below. (6) The interest rate is variable at the higher of one-month LIBOR + 2.25% or 5.77%. (7) Subsequent to June 30, 2022, the Company extended the Springmaid Beach Resort Mortgage Loan to October 10, 2022. (8) The interest rate is variable at the higher of one-month LIBOR + 2.5% or 4.5%. (9) On July 29, 2022, the Company refinanced the Lincoln Court Mortgage Loan with a new lender for an amount up to $39.4 million, of which $35.3 million was funded at the time of closing. The loan is an interest only with an annual variable rate of 3.25% plus the floating rate (SOFR). Additionally, the loan has an initial maturity date of August 7, 2025 with an available three-year extension. (10) The LIBOR rate is variable at the higher of one-month LIBOR or 1.75%, plus 2.18%. (11) Subsequent to June 30, 2022, the Company extended the maturity of the 210 West 31st Street Mortgage Loan to December 16, 2022. Monthly principal payments of $1.0 million beginning on July 10, 2022. (12) Represents the unamortized premium/discount on notes and bonds payable due to the above- and below-market interest rates when the debt was assumed. The discount/premium is amortized over the remaining life of the notes and bonds payable. During the three and six months ended June 30, 2022, the Company incurred $10.8 million and $20.3 million, respectively, of interest expense. Included in interest expense for the three and six months ended June 30, 2022 was $0.8 million and $1.6 million, respectively, of amortization of deferred financing costs. Included in interest expense for the three and six months ended June 30, 2022 was $1.2 million and $2.3 million, respectively, of amortization on discount on notes and bonds payable, net. Additionally, during the three and six months ended June 30, 2022, the Company capitalized $0.5 million and $1.0 million, respectively, of interest related to its investments in undeveloped land. During the three and six months ended June 30, 2021, the Company incurred $10.7 million and $20.6 million, respectively, of interest expense. Included in interest expense for the three and six months ended June 30, 2021 was $0.8 million and $1.6 million, respectively, of amortization of deferred financing costs. Included in interest expense for the three and six months ended June 30, 2021 was $1.0 million and $1.4 million, respectively, of amortization of discount on notes and bonds payable, net. Additionally, during the three and six months ended June 30, 2021, the Company capitalized $0.5 million and $1.1 million, respectively of interest related to its investments in undeveloped land. As of June 30, 2022 and December 31, 2021, the Company’s interest payable was $7.9 million and $6.6 million, respectively. The following is a schedule of maturities, including principal amortization payments, for all notes and bonds payable outstanding as of June 30, 2022 (in thousands): July 1, 2022 through December 31, 2022 $ 306,320 2023 227,395 2024 128,767 2025 216,180 2026 181,642 Thereafter — $ 1,060,304 As of August 12, 2022, the Company had a total of $467.5 million of debt obligations scheduled to mature over the next 12 months. The Company has extension options with respect to $258.8 million of the debt obligations outstanding that are scheduled to mature over the next 12 months; however, the Company cannot exercise these options if not then in compliance with certain financial covenants in the loans without making a cash payment and there is no assurance that the Company will be able to meet these requirements. All of the Company’s debt obligations are generally non-recourse, subject to certain limited guaranty payments, as outlined in the table above, except for the Company’s Series B Debentures. The Company plans to utilize available extension options or refinance the notes payable. The Company may also choose to market the properties for sale or may negotiate a turnover of the secured properties back to the related mortgage lender. The Company’s notes payable contain financial debt covenants, including minimum equity requirements and liquidity ratios. As of June 30, 2022, the Company was in compliance with all of these debt covenants with the exception that the Oakland City Center Mortgage Loan and Georgia 400 Center Mortgage Loan which were not in compliance with the debt service coverage requirement and the Lofts at Noho Commons Mortgage Loan which was not in compliance with the debt yield requirement. As a result of such non-compliance, the Company is required to provide a cash sweep for the Lofts at NoHo Commons Mortgage Loan and the Georgia 400 Center Mortgage Loan, as well as a deposit for the Georgia 400 Center Mortgage Loan. On April 4, 2022, the Company paid a deposit of $20.4 million to the lender of the Georgia 400 Center Mortgage Loan and recorded as restricted cash on the consolidated balance sheets. Additionally, the Company may be required to partially pay down the Oakland City Center Mortgage Loan if the non-compliance continues. Israeli Bond Financings On February 16, 2020, Pacific Oak SOR BVI issued 254.1 million Israeli new Shekels (approximately $74.1 million as of February 16, 2020) of Series B Debentures to Israeli investors pursuant to a public offering registered with the Israel Securities Authority. The Series B Debentures will bear interest at the rate of 3.93% per year. The Series B Debentures have principal installment payments equal to 33.33% of the face amount of the Series B Debentures on January 31st of each year from 2024 to 2026. On November 1, 2021, Pacific Oak SOR BVI issued additional Series B Debentures in the amount of 536.4 million Israeli new Shekels par value through a public offering. The public offering Series B Debentures were issued at a 2.6% discount resulting in a total consideration of 522.4 million Israeli new Shekels ($166.8 million as of November 1, 2021). On November 8, 2021, Pacific Oak SOR BVI also issued Series B Debentures in the amount of 53.6 million Israeli new Shekels par value through a private offering. The private offering Series B Debentures were issued at a 3.1% discount resulting in a total consideration of 52.0 million Israeli new Shekels ($16.7 million as of November 8, 2021). Additionally, on May 2, 2022, Pacific Oak SOR BVI issued Series B Debentures in the amount of 320.4 million Israeli new Shekels par value through a private offering. The private offering Series B Debentures were issued at a 4.0% discount, resulting in a total consideration of 307.6 million Israeli new Shekels ($95.3 million as of May 2, 2022). The additional Series B Debentures have an equal level of security, pari passu, amongst themselves and between them and the initial Series B Debentures, without any right of precedence or preference between any of them. The deed of trust that governs the Series B Debentures contain various financial covenants. As of June 30, 2022, the Company was in compliance with all of these financial debt covenants. |
FAIR VALUE DISCLOSURES
FAIR VALUE DISCLOSURES | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE DISCLOSURES | FAIR VALUE DISCLOSURES The following were the face values, carrying amounts and fair values of the Company’s financial instruments as of June 30, 2022 and December 31, 2021, which carrying amounts do not approximate the fair values (in thousands): June 30, 2022 December 31, 2021 Face Value Carrying Amount Fair Value Face Value Carrying Amount Fair Value Financial liabilities (Level 3): Notes and bond payable $ 726,948 $ 724,395 $ 718,214 $ 743,513 $ 740,176 $ 740,347 Financial liabilities (Level 1): Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures $ 333,356 $ 315,634 $ 314,530 $ 271,978 $ 258,773 $ 274,697 Disclosure of the fair value of financial instruments is based on pertinent information available to the Company as of the period end and requires a significant amount of judgment. This has made the estimation of fair values difficult and, therefore, both the actual results and the Company’s estimate of value at a future date could be materially different. As of June 30, 2022, the Company measured the following assets at fair value (in thousands): Fair Value Measurements Using Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Recurring Basis: Real estate equity securities $ 84,505 $ 84,505 $ — $ — Asset derivative - interest rate caps $ 784 $ — $ 784 $ — As of December 31, 2021, the Company measured the following assets and liabilities at fair value (in thousands): Fair Value Measurements Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring Basis: Real estate equity securities $ 112,096 $ 112,096 $ — $ — Asset derivative - interest rate caps $ 8 $ — $ 8 $ — |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 6 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | RELATED PARTY TRANSACTIONS As described further below, the Company has entered into agreements with certain affiliates pursuant to which they provide services to the Company. Keith D. Hall and Peter McMillan III control and indirectly own Pacific Oak Holding Group, LLC (“Pacific Oak Holding”), the Company’s sponsor since November 1, 2019. Pacific Oak Holding is the sole owner of Pacific Oak Capital Advisors, LLC (the “Advisor”), the Company’s advisor since November 1, 2019. Messrs. Hall and McMillan are also two of the Company’s executive officers and directors. Subject to certain restrictions and limitations, the business of the Company is externally managed by the Advisor pursuant to an advisory agreement (the “Advisory Agreement”). The Advisory Agreement is currently effective through November 1, 2022; however the Company or the Advisor may terminate the Advisory Agreement without cause or penalty upon providing 60 days’ written notice. The Advisor conducts the Company’s operations and manages its portfolio of real estate and other real estate-related investments. Pursuant to the terms of the Advisory Agreement, summarized below are the related-party costs incurred by the Company for the three and six months ended June 30, 2022 and 2021, respectively, and any related amounts payable as of June 30, 2022 and December 31, 2021 (in thousands): Incurred Payable as of Three Months Ended June 30, Six Months Ended June 30, June 30, 2022 December 31, 2021 Expensed 2022 2021 2022 2021 Asset management fees $ 3,189 $ 3,527 $ 6,315 $ 7,380 $ 5,656 $ 1,903 Property management fees (1) 133 123 258 243 — — Disposition fees (2) — 504 107 504 — — Change in subordinated performance fee due upon termination to affiliate (3) — (261) — 200 (3) (3) Capitalized Acquisition fees on real estate (4) — — — 20 — — Acquisition fee on investment in unconsolidated entities — 16 — 45 — — $ 3,322 $ 3,909 $ 6,680 $ 8,392 $ 5,656 $ 1,903 _____________________ (1) Property management fees are for single-family homes and paid to an affiliate of the Advisor. These fees are included in the line item “Operating, maintenance, and management cost” in the consolidated statement of operations. (2) Disposition fees with respect to real estate sold are included in the gain (loss) on sale of real estate in the accompanying consolidated statements of operations. (3) Change in estimate of fees payable to the Company’s previous advisor, KBS Capital Advisors LLC (“KBS Capital Advisors) due to the termination of the former advisory agreement with KBS Capital Advisors. (4) Acquisition fees associated with asset acquisitions are capitalized, while costs associated with business combinations expensed as incurred. During the six months ended June 30, 2022, the Company provided $1.2 million of funding to the 110 William Joint Venture, an unconsolidated entity, for mortgage loan refinancing fees. In the prior year, the Company provided $7.0 million of funding to the 353 Sacramento Joint Venture, an unconsolidated entity, for mortgage loan refinancing fees and was partially repaid during the six months ended June 30, 2022. As of June 30, 2022 and December 31, 2021, the Company recognized a due from affiliate of $1.8 million and $7.0 million, respectively. On June 24, 2022, the Company’s board of directors authorized and approved the redemption of the 510,816 Special Common Units of PORT OP LP, a consolidated subsidiary of the Company (“PORT OP”), representing approximately 3.20% interest, held by BPT Holdings, LLC (“BPT Holdings”), a subsidiary of the Advisor, for a price of $13.09 per unit. The Special Common Units are included as due to affiliates on the consolidated balance sheets. In July 2022, the Company redeemed the special common units of PORT OP for $6.7 million. Following the redemption, the Company owned 100% of PORT OP. Pacific Oak Opportunity Zone Fund I As of June 30, 2022, the Company contributed $27.4 million to the Pacific Oak Opportunity Zone Fund I, LLC (“Pacific Oak Opportunity Zone Fund I”), which is included in investments in unconsolidated entities on the consolidated balance sheets. The Advisor is entitled to certain fees in connection with the fund. Pacific Oak Opportunity Zone Fund I will pay an acquisition fee equal to 1.5% of the purchase price of each asset (including any debt incurred or assumed and significant capital improvement costs budgeted as of the date of acquisition) with a purchase price less than or equal to $25.0 million plus 1.0% of the purchase price in excess of $25.0 million; a quarterly asset management fee equal to 0.25% of the total purchase price of all assets (including any debt incurred or assumed and significant capital improvement costs budgeted as of the date of acquisition) as of the end of the applicable quarter; and a financing fee equal to 0.5% of the original principal amount of any indebtedness incurred (reduced by any financing fee previously paid with respect to indebtedness being refinanced). In the case of investments made through joint ventures, the fees above will be determined based on the Company’s proportionate share of the investment. The Advisor is also entitled to certain distributions paid by the Pacific Oak Opportunity Zone Fund I after the Class A Members have received their preferred return. These fees and distributions have been waived for the Company’s investment. In addition, side letter agreements between the Advisor and Pacific Oak Opportunity Zone Fund I were executed on February 28, 2020 and stipulate that any asset management fees allocable to the Company and waived by Pacific Oak Capital Advisors for Pacific Oak Opportunity Zone Fund I will distributed to the Company. During the three and six months ended June 30, 2022, the Company recorded $0.1 million and $0.2 million, respectively, of waived asset management fees recorded as equity in income of unconsolidated entities, of which $0 was a receivable as of June 30, 2022. During the three and six months ended June 30, 2021, the Company recorded $0.2 million and $0.3 million, respectively, of waived asset management fees recorded as equity in income of unconsolidated entities. PORT II As of June 30, 2022, the Company contributed $34.0 million in PORT II OP LP (“PORT II OP”), a wholly owned subsidiary of Pacific Oak Residential Trust II, Inc. (“PORT II”). On August 31, 2020, PORT II entered into an advisory agreement (as subsequently amended and restated on October 9, 2020, “PORT II Advisory Agreement”) with Pacific Oak Residential Advisors, LLC (“PORA”), an affiliate of the Advisor. Pursuant to the PORT II Advisory Agreement, PORT II has engaged PORA to act as its external advisor with respect to PORT II’s operations and assets. Because the Company has separately engaged the Advisor to manage its operations and assets, including its interests in PORT II, on November 12, 2020, the Company and the Advisor agreed to amend their advisory agreement to provide that PORT II’s operations and assets will be managed by PORA and not by the Advisor. On July 1, 2022, the Company determined that it became the primary beneficiary of PORT II as a result of events that occurred, including a tender offer arrangement to return equity to unrelated investors. As such, in July 2022, the Company consolidated PORT II into the Company’s consolidated financial statements. See Note 13 for further details. On August 31, 2020, PORT II entered into a property management agreement with DMH Realty, LLC (“DMH”), an affiliate of the Advisor and PORA. Pursuant to the property management agreement, PORT II will pay to DMH a base fee equal to the following: (a) for all rent collections up to $50 million per year, 8%; (b) for all rent collections in excess of $50 million per year, but less than or equal to $75 million per year, 7%; and (c) for all rent collections in excess of $75 million per year, 6%. PORT II will also pay DMH market-based leasing fees that will depend on the type of tenant, shared fees equal to 100% of any application fees collected and 50% of any insufficient funds fees, late fees and certain other fees collected. DMH may also perform additional services at rates that would be payable to unrelated parties. |
INVESTMENT IN UNCONSOLIDATED EN
INVESTMENT IN UNCONSOLIDATED ENTITIES | 6 Months Ended |
Jun. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENT IN UNCONSOLIDATED ENTITIES | INVESTMENT IN UNCONSOLIDATED ENTITIES As of June 30, 2022 and December 31, 2021, the Company’s investments in unconsolidated entities were composed of the following (dollars in thousands): Number of Properties as of June 30, 2022 Investment Balance at Joint Venture Location Ownership % June 30, 2022 December 31, 2021 110 William Joint Venture 1 New York, New York 60.0% $ — $ — 353 Sacramento Joint Venture 1 San Francisco, California 55.0% 47,377 49,916 Pacific Oak Opportunity Zone Fund I 3 Various 46.0% 27,356 27,215 PORT II OP LP 588 Various 94.2% 32,606 11,125 $ 107,339 $ 88,256 PORT II PORT II is a Maryland corporation formed and sponsored by the Advisor to acquire, own and operate single family homes as rental properties as well as to acquire and own other interests, including mortgages on or securities related to single family homes. As of June 30, 2022, the Company owns 600 shares of common stock of PORT II. The Company exercises significant influence over the operations, financial policies and decision making with respect to PORT II, but does not control it. The Company made its investment through PORT OP, of which the Company owns 94.2% of PORT II OP as of June 30, 2022. During the six months ended June 30, 2022, the Company contributed an additional $22.5 million to PORT II OP. As of June 30, 2022, the Company has concluded that PORT II OP qualifies as a VIE because there is insufficient equity at risk to finance the entity’s activities and the entity is structured with non-substantive voting rights. The Company concluded it is not the primary beneficiary of this VIE since it does not have the power to direct the activities that most significantly impact the entity’s economic performance and will account for its investment under the equity method of accounting. During the three and six months ended June 30, 2022, the Company recognized losses of $0.4 million and $0.5 million, respectively, related to this investment. During both of the three and six months ended June 30, 2021, the Company recognized losses of $12,000 related to this investment. On July 1, 2022, the Company determined that it became the primary beneficiary of PORT II as a result of events that occurred, including a tender offer arrangement to return equity to unrelated investors. As such, in July 2022, the Company consolidated PORT II into the Company’s consolidated financial statements. See Note 13 for further details. |
SUPPLEMENTAL CASH FLOW AND SIGN
SUPPLEMENTAL CASH FLOW AND SIGNIFICANT NONCASH TRANSACTION DISCLOSURES | 6 Months Ended |
Jun. 30, 2022 | |
Supplemental Cash Flow and Significant Noncash Transaction Disclosures [Abstract] | |
SUPPLEMENTAL CASH FLOW AND SIGNIFICANT NONCASH TRANSACTION DISCLOSURES | SUPPLEMENTAL CASH FLOW AND SIGNIFICANT NONCASH TRANSACTION DISCLOSURES Supplemental cash flow and significant noncash transaction disclosures were as follows (in thousands): Six Months Ended June 30, 2022 2021 Supplemental Disclosure of Cash Flow Information: Interest paid, net of capitalized interest of $1,026 and $1,104 for the six months ended June 30, 2022 and 2021, respectively $ 15,446 $ 17,571 Supplemental Disclosure of Significant Noncash Transactions: Accrued improvements to real estate 3,262 6,075 Redeemable common stock payable 1,379 1,429 Distributions paid to common stockholders through common stock issuances 99,094 — |
REPORTING SEGMENTS
REPORTING SEGMENTS | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
REPORTING SEGMENTS | REPORTING SEGMENTS The Company recognizes three reporting segments for the three and six months ended June 30, 2022 and 2021: strategic opportunistic properties, single-family homes and hotels. All corporate related costs are included in the strategic opportunistic properties segment to align with how financial information is presented to the chief operating decision maker. The selected financial information for reporting segments for the three and six months ended June 30, 2022 and 2021 are as follows (in thousands): Three Months Ended June 30, 2022 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 24,884 $ 5,801 $ 12,854 $ 43,539 Total expenses (13,699) (6,505) (9,432) (29,636) Total other (loss) income (21,797) (479) 4 (22,272) Net (loss) income $ (10,612) $ (1,183) $ 3,426 $ (8,369) Six Months Ended June 30, 2022 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 51,750 $ 11,544 $ 18,771 $ 82,065 Total expenses (40,776) (13,009) (16,844) (70,629) Total other (loss) income (26,387) (521) 2,372 (24,536) Net (loss) income $ (15,413) $ (1,986) $ 4,299 $ (13,100) Three Months Ended June 30, 2021 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 29,075 $ 5,564 $ 9,849 $ 44,488 Total expenses (43,932) (6,999) (8,325) (59,256) Total other income 36,459 54 13 36,526 Net income (loss) $ 21,602 $ (1,381) $ 1,537 $ 21,758 Six Months Ended June 30, 2021 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 60,136 $ 10,870 $ 12,424 $ 83,430 Total expenses (75,528) (13,183) $ (13,976) (102,687) Total other income 46,964 78 $ 13 47,055 Net income (loss) $ 31,572 $ (2,235) $ (1,539) $ 27,798 Total assets and goodwill related to the reporting segments as of June 30, 2022 and December 31, 2021 are as follows (in thousands): June 30, 2022 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total assets $ 1,234,238 $ 227,704 $ 151,513 $ 1,613,455 Goodwill 9,489 — 4,045 13,534 December 31, 2021 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total assets $ 1,223,122 $ 211,050 $ 150,447 $ 1,584,619 Goodwill 9,489 — 4,045 13,534 |
PORT MEZZANINE EQUITY
PORT MEZZANINE EQUITY | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
PORT MEZZANINE EQUITY | PORT MEZZANINE EQUITY The following is a reconciliation of PORT’s noncontrolling cumulative convertible redeemable preferred stock for the six months ended June 30, 2022 and 2021 (dollars in thousands): Series A Preferred Stock Series B Preferred Stock Shares Amounts Shares Amounts Balance, December 31, 2021 15,000 $ 15,134 125 $ 99 Dividends Available Upon Redemption — 672 — 8 Dividends Paid — (672) — (8) Balance, June 30, 2022 15,000 $ 15,134 125 $ 99 Series A Preferred Stock Series B Preferred Stock Shares Amounts Shares Amounts Balance, December 31, 2020 15,000 $ 15,134 125 $ 99 Dividends Available Upon Redemption — 453 — — Dividends Paid — (453) — — Balance, June 30, 2021 15,000 $ 15,134 125 $ 99 On July 1, 2020, the Company acquired, through its subsidiaries, Battery Point Trust Inc. (“Battery Point”). Battery Point is a real estate investment trust that owned, at the time of acquisition, 559 single-family rental homes throughout the midwestern and southeastern United States. All of these assets are held by the Company through its subsidiary, PORT OP. The Company acquired Battery Point by acquiring all the 1,000,000 outstanding shares of Battery Point common stock from BPT Holdings. The Advisor is the Company’s external advisor and is owned and controlled by Keith D. Hall, the Company’s Chief Executive Officer and a director, and Peter M. McMillan, the Company’s President and Chairman of the Board. In exchange, BPT Holdings received 510,816 Special Common Units in PORT OP, approximately 4.5% of the outstanding common equity units, as of July 1, 2020. The value of the interests exchanged was estimated by the participants at approximately $3.0 million. The common equity units issued to BPT Holdings are redeemable after one year at the request of BPT Holdings for all or a portion of the common equity units at a redemption price equal to and in the form of cash based on the unit price of PORT OP. The following table summarizes the redeemable non-controlling interest activity related to the PORT OP equity units held by BPT Holdings for the six months ended June 30, 2022 and 2021 (in thousands): December 31, 2021 $ 2,822 Net loss attributable to redeemable noncontrolling interest (81) Adjustment to value of redeemable noncontrolling interest (1) 3,946 June 30, 2022 $ 6,687 December 31, 2020 $ 2,968 Net loss attributable to redeemable noncontrolling interest (81) June 30, 2021 $ 2,887 _____________________ (1) On June 24, 2022, the Company’s board of directors approved the redemption of the 510,816 PORT OP Special Common Units held by BPT Holdings for a price of $13.09 per unit. As the Company determined that the redemption of the units was certain of occurrence, as of June 30, 2022, the Company reclassified the redeemable noncontrolling interests to due to affiliates on the consolidated balance sheets and recorded at its fair value. The Company redeemed the noncontrolling interest in PORT OP in July 2022. See Note 7 for further details. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES The Company owns two hotels, Springmaid Beach Resort and Q&C Hotel. The operation for both hotels are externally managed by third-party hotel operators, in which the Company have contractual obligations under the management agreements. Management Agreement Springmaid Beach Resort The consolidated joint venture entity through which the Company leases the operations for Springmaid Beach Resort has entered into a management agreement with Doubletree Management LLC, an independent third-party hotel operator (the “Operator”) pursuant to which the Operator will manage and operate the Springmaid Beach Resort. The hotel was branded a DoubleTree by Hilton in September 2016 (the “Brand Commencement Date”). The management agreement expires on December 31 of the 20th full year following the Brand Commencement Date. Upon mutual agreement, the parties may extend the term of the agreement for two successive periods of five years each. If an event of default occurs and continues beyond any applicable notice and cure periods set forth in the management agreement, the non-defaulting party generally has, among other remedies, the option of terminating the management agreement upon written notice to the defaulting party with no termination fee payable to the Operator. In addition, the Company has the right to terminate the management agreement without the payment of a termination fee if the Operator fails to achieve certain criteria relating to the performance of the hotel for any two consecutive years following the Brand Commencement Date. Under certain circumstances following a casualty or condemnation event, either party may terminate the management agreement provided the Operator receives a termination fee an amount equal to two years of the base fee. The Company is permitted to terminate the management agreement upon a sale, lease or other transfer of the Springmaid Beach Resort at any time so long as the buyer is approved for, and enters into the Operator’s franchise agreement for the balance of the agreement’s term. Finally, the Company is restricted in its ability to assign the management agreement upon a sale, lease or other transfer of the Springmaid Beach Resort unless the transferee is approved by the Operator to assume the management agreement. Pursuant to the management agreement the Operator receives the following fees: • a base fee, which is a percentage of total operating revenue that starts at 2.5% and increases to 2.75% in the second year following the Brand Commencement Date and further increases in the third year following the Brand Commencement Date and thereafter to 3.0%; • a campground area management fee, which is 2% of any campground revenue; • an incentive fee, which is 15% of operating cash flow (after deduction for capital renewals reserve and the joint venture owner’s priority, which is 12% of the joint venture owner’s total investment); • an additional services fee in the amount reasonably determined by the Operator from time to time; and • a brand services fee in the amount of 4% of total rooms revenue, and an other brand services fee in an amount determined by the Operator from time to time. The management agreement contains specific standards for the operation and maintenance of the hotel, which allows the Operator to maintain uniformity in the system created by the Operator’s franchise. Such standards generally regulate the appearance of the hotel, quality and type of goods and services offered, signage and protection of trademarks. Compliance with the management agreement will require the Company to make significant expenditures for capital improvements. During the three and six months ended June 30, 2022, the Company incurred $0.3 million and $0.4 million, respectively, of fees related to the management agreement, which are included in hotel expenses on the accompanying consolidated statements of operations. During the three and six months ended June 30, 2021, the Company incurred $0.2 million and $0.3 million, respectively, of fees related to the management agreement, which are included in hotel expenses on the accompanying consolidated statements of operations. Q&C Hotel A wholly owned subsidiary of the joint venture through which the Company leases the operations of the Q&C Hotel (“Q&C Hotel Operations”) has entered into a management agreement with Encore Hospitality, LLC (“Encore Hospitality”), an affiliate of the joint venture partner, pursuant to which Encore Hospitality will manage and operate the Q&C Hotel. The management agreement expires on December 17, 2035. Subject to certain conditions, Encore Hospitality may extend the term of the agreement for a period of five years. Pursuant to the management agreement Encore Hospitality will receive a base fee, which is 4.0% of gross revenue (as defined in the management agreement). During the three and six months ended June 30, 2022, the Company incurred $0.1 million and $0.2 million, respectively, of fees related to the management agreement, which are included in hotel expenses on the accompanying consolidated statements of operations. During the three and six months ended June 30, 2021, the Company incurred $0.05 million and $0.1 million, respectively, of fees related to the management agreement, which are included in hotel expenses on the accompanying consolidated statements of operations. Q&C Hotel Operations has also entered into a franchise agreement with Marriott International (“Marriott”) pursuant to which Marriott has granted Q&C Hotel Operations a limited, non-exclusive license to establish and operate the Q&C Hotel using certain of Marriott’s proprietary marks and systems. The hotel was branded as a Marriott Autograph Collection hotel on May 25, 2016. The franchise agreement will expire on May 25, 2041. Pursuant to the franchise agreement, Q&C Hotel Operations pays Marriott a monthly franchise fee equal to a percent of gross room sales on a sliding scale that is initially 2% and increases to 5% on May 25, 2019 and a monthly marketing fund contribution fee equal to 1.5% of the Q&C Hotel’s gross room sales. In addition, the franchise agreement requires the maintenance of a reserve account to fund all renovations at the hotel based on a percentage of gross revenues which starts at 2% of gross revenues and increases to 5% of gross revenues on May 25, 2019. Q&C Hotel Operations is also responsible for the payment of certain other fees, charges and costs as set forth in the agreement. During the three and six months ended June 30, 2022, the Company incurred $0.3 million and $0.5 million, respectively, of fees related to the Marriott franchise agreement, which are included in hotel expenses on the accompanying consolidated statement of operations. During the three and six months ended June 30, 2021, the Company incurred $0.1 million and $0.2 million, respectively, of fees related to the Marriott franchise agreement, which are included in hotel expenses on the accompanying consolidated statement of operations. In addition, in connection with the execution of the franchise agreement, SOR US Properties II, a wholly owned subsidiary of the Company, is providing an unconditional guarantee that all Q&C Hotel Operations’ obligations under the franchise agreement will be punctually paid and performed. Finally, certain transfers of the Q&C Hotel or an ownership interest therein are subject to a notice and consent requirement, and the franchise agreement further provides Marriott with a right of first refusal with respect to a sale of the hotel to a competitor of Marriott. Lease Obligations As of June 30, 2022, the Company’s lease and rights to a leasehold interest with respect to 210 West 31st, an office/retail building in New York, NY, which was accounted for as a finance lease, are included in the consolidated balance sheet as follows: Right-of-use asset (included in real estate held for investment, net) $ 8,074 Lease obligation (included in other liabilities) 9,403 Remaining lease term 91.5 years Discount rate 4.8 % The components of lease expense were as follows: Interest on lease obligation for the three months ended June 30, 2022 111 Interest on lease obligation for the six months ended June 30, 2022 223 As of June 30, 2022, the Company had a leasehold interest expiring in 2114. Future minimum lease payments owed by the Company under the finance lease as of June 30, 2022 are as follows (in thousands): July 1, 2021 through December 31, 2021 $ 180 2022 360 2023 360 2024 393 2025 396 Thereafter 52,167 Total expected minimum lease obligations 53,856 Less: Amount representing interest (1) (44,453) Present value of net minimum lease payments (2) $ 9,403 _____________________ (1) Interest includes the amount necessary to reduce the total expected minimum lease obligations to present value calculated at the Company’s incremental borrowing rate at acquisition. (2) The present value of net minimum lease payments are presented in other liabilities in the accompanying consolidated balance sheets. Economic Dependency The Company is dependent on the Advisor for certain services that are essential to the Company, including the identification, evaluation, negotiation, origination, acquisition and disposition of investments; management of the daily operations of the Company’s investment portfolio; and other general and administrative responsibilities. In the event that the Advisor is unable to provide these services, the Company will be required to obtain such services from other sources. Environmental As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. Although there can be no assurance, the Company is not aware of any environmental liability that could have a material adverse effect on its financial condition or results of operations as of June 30, 2022. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s properties, the activities of its tenants and other environmental conditions of which the Company is unaware with respect to the properties could result in future environmental liabilities. Legal Matters |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 6 Months Ended |
Jun. 30, 2022 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS The Company evaluates subsequent events up until the date the consolidated financial statements are issued. PORT II Reconsideration On July 1, 2022, the Company, through PORT OP, made a tender offer to purchase 76,735 shares of PORT II common stock held by unrelated parties for a price of $14.66 per share. As a result, the Company determined that it became the primary beneficiary of PORT II, which resulted in the consolidation of PORT II into the Company’s consolidated financial statements. On July 29, 2022, the Company consummated the transactions with the unrelated parties and owned 100% of PORT II. The Company is in the process of assessing the fair value of the assets and liabilities to be consolidated. The Company’s preliminary fair values are: $135.1 million of 588 single-family homes and $82.6 million to the notes payable. There are no liquidity arrangements or agreements to fund capital or purchase assets that could require the Company to provide financial support to PORT II. The Company and the aforementioned unrelated parties did not guarantee any debt in connection with the transaction. Please refer to Notes 8 and 9 for additional details. Springmaid Beach Resort Purchase and Sale Contract On July 14, 2022, the Company’s board of directors committed to a plan to sell the Springmaid Beach Resort to an unrelated party. On July 15, 2022, the Company, through an indirect wholly owned subsidiary, entered into an amended purchase and sale agreement, to sell the Springmaid Beach Resort for $91.0 million, before closing costs and credits. The mortgage loan secured by the property had an outstanding principal balance of $53.1 million as of July 15, 2022. The due diligence period has expired and the buyer’s deposit of $2.0 million is no longer refundable. The Company expects to close the transaction in the third quarter of 2022, but can give no assurances that the sale will be completed. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Jun. 30, 2022 | |
Accounting Policies [Abstract] | |
Basis of Presentation | The accompanying unaudited consolidated financial statements and condensed notes thereto have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the FASB Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair and consistent presentation of the results for such periods. Operating results for the three and six months ended June 30, 2022 are not necessarily indicative of the results that may be expected for the year ending December 31, 2022. |
Principles of Consolidation | The consolidated financial statements include the accounts of the Company, REIT Holdings, the Operating Partnership, Pacific Oak SOR BVI and their direct and indirect wholly owned subsidiaries, joint ventures in which the Company has a controlling interest and VIEs in which the Company is the primary beneficiary. All significant intercompany balances and transactions are eliminated in consolidation. |
Reclassifications | Certain prior period amounts have been reclassified to conform to the current period presentation. In that regard, the Company reclassified held for sale activity related to dispositions in its consolidated balance sheets as of December 31, 2021. |
Use of Estimates | The preparation of the consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates. |
Restricted Cash | Restricted cash is comprised of escrow deposits for future real estate sales and lender impound reserve accounts on the Company’s borrowings for security deposits, property taxes, insurance, debt service obligations and capital improvements and replacements. |
Segments | The Company operates in three reportable business segments: opportunistic real estate and real estate-related investments, single-family homes, and hotels, which is how the Company’s management manages the business. In general, the Company intends to hold its investments in opportunistic real estate and other real estate-related assets for capital appreciation. Traditional performance metrics of opportunistic real estate and other real estate-related assets may not be meaningful as these investments are generally non-stabilized and do not provide a consistent stream of interest income or rental revenue. These investments exhibit similar long-term financial performance and have similar economic characteristics. These investments typically involve a higher degree of risk and do not provide a constant stream of ongoing cash flows. As a result, the Company’s management views opportunistic real estate and other real estate-related assets as similar investments and aggregated them into one reportable business segment. The Company owns single-family homes in 18 markets which are all aggregated into one reportable business segment due to the homes being stabilized, having high occupancy rates and have similar economic characteristics. Additionally, the Company owns two hotels which are aggregated into one reportable business segment due to the nature of the hotel business with short-term stays. |
Per Share Data | The Company determines basic earnings per share and basic earnings per unit based on the weighted average number of shares of common stock or units, as applicable, outstanding during the period and the Company considers any participating securities, including unvested restricted stock, for purposes of applying the two-class method. The Company determines diluted earnings per share and diluted earnings per unit based on the weighted average number of shares of common stock or units, as applicable, outstanding combined with the incremental weighted average number of shares or units, as applicable, that would have been outstanding assuming all potentially dilutive securities were converted into shares of common stock or units, as applicable, at the earliest date possible. The noncontrolling Series A convertible redeemable preferred shares of Pacific Oak Residential Trust, Inc. (“PORT”) were not included as the shares are contingent on PORT being public. |
Square Footage, Occupancy and Other Measures | Any references to square footage, occupancy or annualized base rent are unaudited and outside the scope of the Company’s independent registered public accounting firm’s review of the Company’s financial statements in accordance with the standards of the United States Public Company Accounting Oversight Board. |
Fair Value Measurement | Disclosure of the fair value of financial instruments is based on pertinent information available to the Company as of the period end and requires a significant amount of judgment. This has made the estimation of fair values difficult and, therefore, both the actual results and the Company’s estimate of value at a future date could be materially different. |
REAL ESTATE HELD FOR INVESTME_2
REAL ESTATE HELD FOR INVESTMENT (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Real Estate [Abstract] | |
Schedule of Real Estate Investments | The following table summarizes the Company’s real estate held for investment as of June 30, 2022 and December 31, 2021, respectively (in thousands): June 30, 2022 December 31, 2021 Land $ 277,513 $ 275,683 Buildings and improvements 1,026,110 1,017,465 Tenant origination and absorption costs 38,935 43,375 Total real estate, cost 1,342,558 1,336,523 Accumulated depreciation and amortization (148,079) (127,280) Total real estate, net $ 1,194,479 $ 1,209,243 |
Schedule of Future Minimum Rental Income for Company's Properties | As of June 30, 2022, the future minimum rental income from the Company’s properties, excluding apartment leases and single-family homes, under non-cancelable operating leases was as follows (in thousands): July 1, 2022 through December 31, 2022 $ 30,337 2023 56,342 2024 50,498 2025 39,743 2026 27,742 Thereafter 66,722 $ 271,384 |
Schedule of Real Estate by Industry | The Company’s highest tenant industry concentrations (greater than 10% of annualized base rent) were as follows: Industry Number of Tenants Annualized Base Rent (1) (in thousands) Percentage of Professional, Scientific, and Technical Services 41 $ 7,837 12.4 % Public Administration 13 7,720 12.3 % Computer Systems Design and Related Services 31 7,567 12.0 % $ 23,124 36.7 % |
Schedule of Hotel Revenue | The following table provides detailed information regarding the Company’s hotel revenues for its two hotel properties during the three and six months ended June 30, 2022 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Hotel revenues: Room $ 9,905 $ 7,439 $ 14,200 $ 9,112 Food, beverage and convention services 309 1,082 589 1,378 Campground 1,603 269 2,395 512 Other 1,037 1,059 1,587 1,422 Hotel revenues $ 12,854 $ 9,849 $ 18,771 $ 12,424 |
Schedule of Contract Liability | The following table summarizes the Company’s contract liabilities, which are comprised of hotel advanced deposits and deferred proceeds from historical and future land sales received from the buyers of the Park Highlands land sales (discussed below) and another developer for the value of land that was contributed to a master association that is consolidated by the Company, which are included in other liabilities in the accompanying consolidated balance sheets, as of June 30, 2022 and December 31, 2021 (in thousands): June 30, 2022 December 31, 2021 Contract liability $ 24,081 $ 7,313 Revenue recognized in the period from: Amounts included in contract liability at the beginning of the period $ 373 $ 159 |
REAL ESTATE EQUITY SECURITIES (
REAL ESTATE EQUITY SECURITIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Investments, Debt and Equity Securities [Abstract] | |
Gain (Loss) on Investments | The following summarizes the portion of gain and loss for the period related to real estate equity securities held during the three and six months ended June 30, 2022 and 2021 (in thousands): Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Net (loss) gain recognized during the period on real estate equity securities $ (20,070) $ 4,800 $ (27,591) $ 15,553 Less net gain recognized during the period on real estate equity securities sold during the period — — — (225) Unrealized (loss) gain recognized during the reporting period on real estate equity securities held at the end of the period $ (20,070) $ 4,800 $ (27,591) $ 15,328 |
NOTES AND BONDS PAYABLE (Tables
NOTES AND BONDS PAYABLE (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Notes and Bonds Payable [Abstract] | |
Schedule of Long-term Debt Instruments | As of June 30, 2022 and December 31, 2021, the Company’s notes and bonds payable, including notes payable related to real estate held for sale, consisted of the following (dollars in thousands): Book Value as of June 30, 2022 Book Value as of December 31, 2021 Contractual Interest Rate as of June 30, 2022 Effective Interest Rate at June 30, 2022 (1) Payment Type (2) Maturity Date (3) Richardson Portfolio Mortgage Loan $ 19,055 $ 28,470 Floating Rate + 2.50% 4.30% Principal & Interest 11/01/2022 Park Centre Mortgage Loan 26,185 26,185 Floating Rate + 1.75% 3.55% Interest Only 06/27/2023 1180 Raymond Mortgage Loan (4) 31,070 31,070 Floating Rate + 2.25% 3.83% Interest Only 12/01/2023 Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures (5) 333,356 271,978 3.93% 3.93% (5) 01/31/2026 Crown Pointe Mortgage Loan 53,758 52,315 Floating Rate + 2.30% 3.80% Interest Only 04/01/2025 The Marq Mortgage Loan 61,556 61,874 Floating Rate + 1.55% 3.35% Principal & Interest 06/06/2023 Eight & Nine Corporate Centre Mortgage Loan 48,295 48,545 Floating Rate + 1.60% 3.40% Principal & Interest 06/08/2023 Georgia 400 Center Mortgage Loan 61,154 61,154 Floating Rate + 1.55% 3.35% Interest Only 05/22/2023 PORT Mortgage Loan 1 51,303 51,302 4.74% 4.74% Interest Only 10/01/2025 PORT Mortgage Loan 2 10,523 10,523 4.72% 4.72% Interest Only 03/01/2026 PORT MetLife Loan 60,000 60,000 3.90% 3.90% Interest Only 04/10/2026 Springmaid Beach Resort Mortgage Loan 53,054 55,491 Floating Rate + 2.25% (6) 5.75% Principal & Interest 08/12/2022 (7) Q&C Hotel Mortgage Loan 24,904 25,000 Floating Rate + 2.50% (8) 4.50% Principal & Interest 12/23/2022 Lincoln Court Mortgage Loan (4) 32,491 34,623 Floating Rate + 2.25% 4.05% Principal & Interest 08/1/2022 (9) Lofts at NoHo Commons Mortgage Loan 74,536 74,536 Floating Rate + 2.18% (10) 3.98% Interest Only 09/09/2022 210 West 31st Street Mortgage Loan (4) 6,000 8,850 Floating Rate + 3.00% 4.80% Principal & Interest 06/16/2022 (11) Oakland City Center Mortgage Loan 95,415 96,075 Floating Rate + 1.75% 3.55% Principal & Interest 09/01/2022 Madison Square Mortgage Loan 17,649 17,500 4.63% 4.63% Interest Only 10/07/2024 Total Notes and Bonds Payable principal outstanding 1,060,304 1,015,491 Discount on Notes and Bonds Payable, net (12) (9,636) (8,146) Deferred financing costs, net (10,639) (8,396) Total Notes and Bonds Payable, net $ 1,040,029 $ 998,949 _____________________ (1) Contractual interest rate represents the interest rate in effect under the loan as of June 30, 2022. Effective interest rate is calculated as the actual interest rate in effect as of June 30, 2022 (consisting of the contractual interest rate and contractual floor rates), using interest rate indices at June 30, 2022, where applicable. (2) Represents the payment type required under the loan as of June 30, 2022. Certain future monthly payments due under this loan also include amortizing principal payments. For more information of the Company’s contractual obligations under its notes and bonds payable, see five-year maturity table below. (3) Represents the initial maturity date or the maturity date as extended as of June 30, 2022; subject to certain conditions, the maturity dates of certain loans may be extended beyond the date shown. (4) The Company’s notes and bond’s payable are generally non-recourse. These mortgage loans have guarantees over certain balances whereby the Company would be required to make guaranteed payments in the event that the Company turned the property over to the lender. The guarantees are typically 25% of the outstanding loan balance. As of June 30, 2022, the guaranteed amount in the aggregate was $21.9 million. (5) See “Israeli Bond Financings” below. (6) The interest rate is variable at the higher of one-month LIBOR + 2.25% or 5.77%. (7) Subsequent to June 30, 2022, the Company extended the Springmaid Beach Resort Mortgage Loan to October 10, 2022. (8) The interest rate is variable at the higher of one-month LIBOR + 2.5% or 4.5%. (9) On July 29, 2022, the Company refinanced the Lincoln Court Mortgage Loan with a new lender for an amount up to $39.4 million, of which $35.3 million was funded at the time of closing. The loan is an interest only with an annual variable rate of 3.25% plus the floating rate (SOFR). Additionally, the loan has an initial maturity date of August 7, 2025 with an available three-year extension. (10) The LIBOR rate is variable at the higher of one-month LIBOR or 1.75%, plus 2.18%. (11) Subsequent to June 30, 2022, the Company extended the maturity of the 210 West 31st Street Mortgage Loan to December 16, 2022. Monthly principal payments of $1.0 million beginning on July 10, 2022. (12) Represents the unamortized premium/discount on notes and bonds payable due to the above- and below-market interest rates when the debt was assumed. The discount/premium is amortized over the remaining life of the notes and bonds payable. |
Schedule of Maturities of Long-term Debt | The following is a schedule of maturities, including principal amortization payments, for all notes and bonds payable outstanding as of June 30, 2022 (in thousands): July 1, 2022 through December 31, 2022 $ 306,320 2023 227,395 2024 128,767 2025 216,180 2026 181,642 Thereafter — $ 1,060,304 |
FAIR VALUE DISCLOSURES (Tables)
FAIR VALUE DISCLOSURES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Fair Value Disclosures [Abstract] | |
Schedule of Face Value, Carrying Amounts and Fair Value | The following were the face values, carrying amounts and fair values of the Company’s financial instruments as of June 30, 2022 and December 31, 2021, which carrying amounts do not approximate the fair values (in thousands): June 30, 2022 December 31, 2021 Face Value Carrying Amount Fair Value Face Value Carrying Amount Fair Value Financial liabilities (Level 3): Notes and bond payable $ 726,948 $ 724,395 $ 718,214 $ 743,513 $ 740,176 $ 740,347 Financial liabilities (Level 1): Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures $ 333,356 $ 315,634 $ 314,530 $ 271,978 $ 258,773 $ 274,697 |
Fair Value, Assets Measured on Recurring Basis | As of June 30, 2022, the Company measured the following assets at fair value (in thousands): Fair Value Measurements Using Total Quoted Prices in Active Markets for Identical Assets Significant Other Observable Inputs Significant Unobservable Inputs Recurring Basis: Real estate equity securities $ 84,505 $ 84,505 $ — $ — Asset derivative - interest rate caps $ 784 $ — $ 784 $ — As of December 31, 2021, the Company measured the following assets and liabilities at fair value (in thousands): Fair Value Measurements Using Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Recurring Basis: Real estate equity securities $ 112,096 $ 112,096 $ — $ — Asset derivative - interest rate caps $ 8 $ — $ 8 $ — |
RELATED PARTY TRANSACTIONS (Tab
RELATED PARTY TRANSACTIONS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Costs | Pursuant to the terms of the Advisory Agreement, summarized below are the related-party costs incurred by the Company for the three and six months ended June 30, 2022 and 2021, respectively, and any related amounts payable as of June 30, 2022 and December 31, 2021 (in thousands): Incurred Payable as of Three Months Ended June 30, Six Months Ended June 30, June 30, 2022 December 31, 2021 Expensed 2022 2021 2022 2021 Asset management fees $ 3,189 $ 3,527 $ 6,315 $ 7,380 $ 5,656 $ 1,903 Property management fees (1) 133 123 258 243 — — Disposition fees (2) — 504 107 504 — — Change in subordinated performance fee due upon termination to affiliate (3) — (261) — 200 (3) (3) Capitalized Acquisition fees on real estate (4) — — — 20 — — Acquisition fee on investment in unconsolidated entities — 16 — 45 — — $ 3,322 $ 3,909 $ 6,680 $ 8,392 $ 5,656 $ 1,903 _____________________ (1) Property management fees are for single-family homes and paid to an affiliate of the Advisor. These fees are included in the line item “Operating, maintenance, and management cost” in the consolidated statement of operations. (2) Disposition fees with respect to real estate sold are included in the gain (loss) on sale of real estate in the accompanying consolidated statements of operations. (3) Change in estimate of fees payable to the Company’s previous advisor, KBS Capital Advisors LLC (“KBS Capital Advisors) due to the termination of the former advisory agreement with KBS Capital Advisors. (4) Acquisition fees associated with asset acquisitions are capitalized, while costs associated with business combinations expensed as incurred. |
INVESTMENT IN UNCONSOLIDATED _2
INVESTMENT IN UNCONSOLIDATED ENTITIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Investments in Unconsolidated Joint Ventures | As of June 30, 2022 and December 31, 2021, the Company’s investments in unconsolidated entities were composed of the following (dollars in thousands): Number of Properties as of June 30, 2022 Investment Balance at Joint Venture Location Ownership % June 30, 2022 December 31, 2021 110 William Joint Venture 1 New York, New York 60.0% $ — $ — 353 Sacramento Joint Venture 1 San Francisco, California 55.0% 47,377 49,916 Pacific Oak Opportunity Zone Fund I 3 Various 46.0% 27,356 27,215 PORT II OP LP 588 Various 94.2% 32,606 11,125 $ 107,339 $ 88,256 |
SUPPLEMENTAL CASH FLOW AND SI_2
SUPPLEMENTAL CASH FLOW AND SIGNIFICANT NONCASH TRANSACTION DISCLOSURES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Supplemental Cash Flow and Significant Noncash Transaction Disclosures [Abstract] | |
Schedule of Cash Flow, Supplemental Disclosures | Supplemental cash flow and significant noncash transaction disclosures were as follows (in thousands): Six Months Ended June 30, 2022 2021 Supplemental Disclosure of Cash Flow Information: Interest paid, net of capitalized interest of $1,026 and $1,104 for the six months ended June 30, 2022 and 2021, respectively $ 15,446 $ 17,571 Supplemental Disclosure of Significant Noncash Transactions: Accrued improvements to real estate 3,262 6,075 Redeemable common stock payable 1,379 1,429 Distributions paid to common stockholders through common stock issuances 99,094 — |
REPORTING SEGMENTS (Tables)
REPORTING SEGMENTS (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The selected financial information for reporting segments for the three and six months ended June 30, 2022 and 2021 are as follows (in thousands): Three Months Ended June 30, 2022 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 24,884 $ 5,801 $ 12,854 $ 43,539 Total expenses (13,699) (6,505) (9,432) (29,636) Total other (loss) income (21,797) (479) 4 (22,272) Net (loss) income $ (10,612) $ (1,183) $ 3,426 $ (8,369) Six Months Ended June 30, 2022 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 51,750 $ 11,544 $ 18,771 $ 82,065 Total expenses (40,776) (13,009) (16,844) (70,629) Total other (loss) income (26,387) (521) 2,372 (24,536) Net (loss) income $ (15,413) $ (1,986) $ 4,299 $ (13,100) Three Months Ended June 30, 2021 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 29,075 $ 5,564 $ 9,849 $ 44,488 Total expenses (43,932) (6,999) (8,325) (59,256) Total other income 36,459 54 13 36,526 Net income (loss) $ 21,602 $ (1,381) $ 1,537 $ 21,758 Six Months Ended June 30, 2021 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total revenues $ 60,136 $ 10,870 $ 12,424 $ 83,430 Total expenses (75,528) (13,183) $ (13,976) (102,687) Total other income 46,964 78 $ 13 47,055 Net income (loss) $ 31,572 $ (2,235) $ (1,539) $ 27,798 Total assets and goodwill related to the reporting segments as of June 30, 2022 and December 31, 2021 are as follows (in thousands): June 30, 2022 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total assets $ 1,234,238 $ 227,704 $ 151,513 $ 1,613,455 Goodwill 9,489 — 4,045 13,534 December 31, 2021 Strategic Opportunistic Properties Single-Family Homes Hotels Total Total assets $ 1,223,122 $ 211,050 $ 150,447 $ 1,584,619 Goodwill 9,489 — 4,045 13,534 |
PORT MEZZANINE EQUITY (Tables)
PORT MEZZANINE EQUITY (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Equity [Abstract] | |
Schedule of Stock by Class | The following is a reconciliation of PORT’s noncontrolling cumulative convertible redeemable preferred stock for the six months ended June 30, 2022 and 2021 (dollars in thousands): Series A Preferred Stock Series B Preferred Stock Shares Amounts Shares Amounts Balance, December 31, 2021 15,000 $ 15,134 125 $ 99 Dividends Available Upon Redemption — 672 — 8 Dividends Paid — (672) — (8) Balance, June 30, 2022 15,000 $ 15,134 125 $ 99 Series A Preferred Stock Series B Preferred Stock Shares Amounts Shares Amounts Balance, December 31, 2020 15,000 $ 15,134 125 $ 99 Dividends Available Upon Redemption — 453 — — Dividends Paid — (453) — — Balance, June 30, 2021 15,000 $ 15,134 125 $ 99 |
Schedule of Redeemable Non-controlling Interest Activities | The following table summarizes the redeemable non-controlling interest activity related to the PORT OP equity units held by BPT Holdings for the six months ended June 30, 2022 and 2021 (in thousands): December 31, 2021 $ 2,822 Net loss attributable to redeemable noncontrolling interest (81) Adjustment to value of redeemable noncontrolling interest (1) 3,946 June 30, 2022 $ 6,687 December 31, 2020 $ 2,968 Net loss attributable to redeemable noncontrolling interest (81) June 30, 2021 $ 2,887 _____________________ (1) On June 24, 2022, the Company’s board of directors approved the redemption of the 510,816 PORT OP Special Common Units held by BPT Holdings for a price of $13.09 per unit. As the Company determined that the redemption of the units was certain of occurrence, as of June 30, 2022, the Company reclassified the redeemable noncontrolling interests to due to affiliates on the consolidated balance sheets and recorded at its fair value. The Company redeemed the noncontrolling interest in PORT OP in July 2022. See Note 7 for further details. |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Tables) | 6 Months Ended |
Jun. 30, 2022 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Lease Cost | As of June 30, 2022, the Company’s lease and rights to a leasehold interest with respect to 210 West 31st, an office/retail building in New York, NY, which was accounted for as a finance lease, are included in the consolidated balance sheet as follows: Right-of-use asset (included in real estate held for investment, net) $ 8,074 Lease obligation (included in other liabilities) 9,403 Remaining lease term 91.5 years Discount rate 4.8 % The components of lease expense were as follows: Interest on lease obligation for the three months ended June 30, 2022 111 Interest on lease obligation for the six months ended June 30, 2022 223 |
Schedule of Finance Lease, Liability, Fiscal Year Maturity | As of June 30, 2022, the Company had a leasehold interest expiring in 2114. Future minimum lease payments owed by the Company under the finance lease as of June 30, 2022 are as follows (in thousands): July 1, 2021 through December 31, 2021 $ 180 2022 360 2023 360 2024 393 2025 396 Thereafter 52,167 Total expected minimum lease obligations 53,856 Less: Amount representing interest (1) (44,453) Present value of net minimum lease payments (2) $ 9,403 _____________________ (1) Interest includes the amount necessary to reduce the total expected minimum lease obligations to present value calculated at the Company’s incremental borrowing rate at acquisition. (2) The present value of net minimum lease payments are presented in other liabilities in the accompanying consolidated balance sheets. |
ORGANIZATION (Details)
ORGANIZATION (Details) - shares | 6 Months Ended | ||
Jun. 30, 2022 | Dec. 31, 2021 | Dec. 18, 2015 | |
Organizational Structure [Line Items] | |||
Common stock, shares authorized (in shares) | 1,000,000,000 | 1,000,000,000 | |
Common stock, shares issued (in shares) | 104,319,092 | 94,141,251 | |
Operating Partnership | |||
Organizational Structure [Line Items] | |||
Partnership interest in Operating Partnership | 0.10% | ||
Partnership interest in the Operating Partnership and is its sole limited partner | 99.90% | ||
Pacific Oak Strategic Opportunity BVI | |||
Organizational Structure [Line Items] | |||
Common stock, shares authorized (in shares) | 50,000 | ||
Pacific Oak Strategic Opportunity BVI | Operating Partnership | |||
Organizational Structure [Line Items] | |||
Common stock, shares issued (in shares) | 10,000 |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2022 USD ($) property segment | Jun. 30, 2021 segment | Jun. 30, 2022 USD ($) property | Jun. 30, 2022 USD ($) property market | Jun. 30, 2022 USD ($) property segment | Jun. 30, 2021 segment | |
Segment Reporting Information [Line Items] | ||||||
Debt obligations, next twelve months | $ | $ 227,395 | $ 227,395 | $ 227,395 | $ 227,395 | ||
Number of reportable segments | 3 | 3 | 3 | 3 | 3 | |
Office Properties | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of real estate properties | property | 8 | 8 | 8 | 8 | ||
Hotel | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of real estate properties | property | 2 | 2 | 2 | 2 | ||
Mortgages | Minimum | ||||||
Segment Reporting Information [Line Items] | ||||||
Long-term debt, term | 3 years | 3 years | 3 years | 3 years | ||
Mortgages | Maximum | ||||||
Segment Reporting Information [Line Items] | ||||||
Long-term debt, term | 5 years | 5 years | 5 years | 5 years | ||
Single-Family Homes | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of reportable segments | segment | 1 | |||||
Single family home markets | market | 18 | |||||
Hotels | ||||||
Segment Reporting Information [Line Items] | ||||||
Number of reportable segments | segment | 1 |
REAL ESTATE HELD FOR INVESTME_3
REAL ESTATE HELD FOR INVESTMENT - Additional Information (Details) ft² in Millions | Jun. 30, 2022 a ft² property room unit portfolio |
Real Estate Properties [Line Items] | |
Percentage of portfolio occupied | 72% |
Office Properties | |
Real Estate Properties [Line Items] | |
Number of real estate properties | 8 |
Office Portfolio | |
Real Estate Properties [Line Items] | |
Number of real estate properties consolidated | portfolio | 1 |
Office Buildings, Portfolio | |
Real Estate Properties [Line Items] | |
Number of real estate properties consolidated | 2 |
Undeveloped Land, Portfolio | |
Real Estate Properties [Line Items] | |
Real estate area of undeveloped land | a | 14 |
Rentable square feet | ft² | 3.2 |
Residential Home Portfolio | |
Real Estate Properties [Line Items] | |
Number of real estate properties | portfolio | 1 |
Rentable square feet | ft² | 2.5 |
Percentage of portfolio occupied | 92% |
Number of units in real estate property | unit | 1,815 |
Apartment Building | |
Real Estate Properties [Line Items] | |
Number of real estate properties consolidated | 2 |
Rentable square feet | ft² | 0.5 |
Percentage of portfolio occupied | 92% |
Number of units in real estate property | unit | 609 |
Hotel | |
Real Estate Properties [Line Items] | |
Number of real estate properties | 2 |
Number of Rooms | room | 649 |
Undeveloped Land | |
Real Estate Properties [Line Items] | |
Real estate area of undeveloped land | a | 800 |
Number of investments in real estate | 3 |
Office/ Retail Property | |
Real Estate Properties [Line Items] | |
Number of real estate properties | 1 |
REAL ESTATE HELD FOR INVESTME_4
REAL ESTATE HELD FOR INVESTMENT - Schedule of Real Estate Investments (Details) - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Real Estate Properties [Line Items] | ||
Total real estate, cost | $ 1,342,558 | $ 1,336,523 |
Accumulated depreciation and amortization | (148,079) | (127,280) |
Total real estate, net | 1,194,479 | 1,209,243 |
Land | ||
Real Estate Properties [Line Items] | ||
Total real estate, cost | 277,513 | 275,683 |
Buildings and improvements | ||
Real Estate Properties [Line Items] | ||
Total real estate, cost | 1,026,110 | 1,017,465 |
Tenant origination and absorption costs | ||
Real Estate Properties [Line Items] | ||
Total real estate, cost | $ 38,935 | $ 43,375 |
REAL ESTATE HELD FOR INVESTME_5
REAL ESTATE HELD FOR INVESTMENT - Operating Leases, Additional Information (Details) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 USD ($) tenant | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) tenant | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Operating Leased Assets [Line Items] | |||||
Security deposit liability | $ 6,100,000 | $ 6,100,000 | $ 6,000,000 | ||
Recognition of deferred revenue, net of discontinued operations | 400,000 | $ 30,000 | 1,400,000 | $ 1,100,000 | |
Deferred rent receivables | 17,000,000 | 17,000,000 | 16,300,000 | ||
Incentive to lessee | $ 2,800,000 | $ 2,800,000 | $ 3,300,000 | ||
Number of Tenants | tenant | 300 | 300 | |||
Maximum | |||||
Operating Leased Assets [Line Items] | |||||
Operating lease, term | 13 years 2 months 12 days | 13 years 2 months 12 days | |||
Weighted Average | |||||
Operating Leased Assets [Line Items] | |||||
Operating lease, term | 3 years 8 months 12 days | 3 years 8 months 12 days | |||
Apartment Building | |||||
Operating Leased Assets [Line Items] | |||||
Operating lease, term | 1 year | 1 year |
REAL ESTATE HELD FOR INVESTME_6
REAL ESTATE HELD FOR INVESTMENT - Future Minimum Rental Income (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Real Estate [Abstract] | |
July 1, 2022 through December 31, 2022 | $ 30,337 |
2023 | 56,342 |
2024 | 50,498 |
2025 | 39,743 |
2026 | 27,742 |
Thereafter | 66,722 |
Future minimum rental income | $ 271,384 |
REAL ESTATE HELD FOR INVESTME_7
REAL ESTATE HELD FOR INVESTMENT - Highest Tenant Industry Concentrations - Greater than 10% of Annual Base Rent (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) tenant | |
Concentration Risk [Line Items] | |
Number of Tenants | tenant | 300 |
Annualized Base Rent | $ | $ 23,124 |
Professional, Scientific, and Technical Services | |
Concentration Risk [Line Items] | |
Number of Tenants | tenant | 41 |
Annualized Base Rent | $ | $ 7,837 |
Professional, Scientific, and Technical Services | Industry | Revenue Benchmark | |
Concentration Risk [Line Items] | |
Percentage of Annualized Base Rent | 12.40% |
Public Administration | |
Concentration Risk [Line Items] | |
Number of Tenants | tenant | 13 |
Annualized Base Rent | $ | $ 7,720 |
Public Administration | Industry | Revenue Benchmark | |
Concentration Risk [Line Items] | |
Percentage of Annualized Base Rent | 12.30% |
Computer Systems Design and Related Services | |
Concentration Risk [Line Items] | |
Number of Tenants | tenant | 31 |
Annualized Base Rent | $ | $ 7,567 |
Computer Systems Design and Related Services | Industry | Revenue Benchmark | |
Concentration Risk [Line Items] | |
Percentage of Annualized Base Rent | 12% |
Industry | Industry | Revenue Benchmark | |
Concentration Risk [Line Items] | |
Percentage of Annualized Base Rent | 36.70% |
REAL ESTATE HELD FOR INVESTME_8
REAL ESTATE HELD FOR INVESTMENT - Geographic Concentration Risk (Details) - Assets, Total - Geographic Concentration Risk | 6 Months Ended |
Jun. 30, 2022 | |
California | |
Concentration Risk [Line Items] | |
Concentration risk, percentage | 21.60% |
Georgia | |
Concentration Risk [Line Items] | |
Concentration risk, percentage | 10% |
REAL ESTATE HELD FOR INVESTME_9
REAL ESTATE HELD FOR INVESTMENT - Hotel Revenue and Expenses (Details) - Hotel - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Revenues: | ||||
Revenue from contract with customer | $ 12,854 | $ 9,849 | $ 18,771 | $ 12,424 |
Room | ||||
Revenues: | ||||
Revenue from contract with customer | 9,905 | 7,439 | 14,200 | 9,112 |
Food, beverage and convention services | ||||
Revenues: | ||||
Revenue from contract with customer | 309 | 1,082 | 589 | 1,378 |
Campground | ||||
Revenues: | ||||
Revenue from contract with customer | 1,603 | 269 | 2,395 | 512 |
Other | ||||
Revenues: | ||||
Revenue from contract with customer | $ 1,037 | $ 1,059 | $ 1,587 | $ 1,422 |
REAL ESTATE HELD FOR INVESTM_10
REAL ESTATE HELD FOR INVESTMENT - Contract Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Product Liability Contingency [Line Items] | |||
Amounts included in contract liability at the beginning of the period | $ 1,427 | $ 1,113 | |
Other liabilities | |||
Product Liability Contingency [Line Items] | |||
Contract liability | 24,081 | $ 7,313 | |
Amounts included in contract liability at the beginning of the period | $ 373 | $ 159 |
REAL ESTATE HELD FOR INVESTM_11
REAL ESTATE HELD FOR INVESTMENT - Recent Real Estate Sale (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jan. 24, 2022 USD ($) ft² property | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) | Jun. 30, 2021 USD ($) | Dec. 31, 2021 USD ($) | |
Real Estate Properties [Line Items] | ||||||
Real estate held for sale, net | $ 0 | $ 0 | $ 5,556 | |||
Accumulated depreciation and amortization | 148,079 | 148,079 | $ 127,280 | |||
Gain on sale of real estate | $ (175) | $ 31,148 | $ 3,348 | $ 31,170 | ||
Greenway Buildings Mortgage Loan | ||||||
Real Estate Properties [Line Items] | ||||||
Extinguishment of debt | $ 9,100 | |||||
Greenway Buildings | Office Properties | ||||||
Real Estate Properties [Line Items] | ||||||
Real estate held for sale, net | 5,600 | |||||
Accumulated depreciation and amortization | 3,200 | |||||
Greenway Buildings | Disposed of by Sale | Office Properties | ||||||
Real Estate Properties [Line Items] | ||||||
Sale price | $ 11,000 | |||||
Number of real estate properties disposed | property | 2 | |||||
Net rentable area (in sq feet) | ft² | 141,950 | |||||
Gain on sale of real estate | $ 3,600 |
REAL ESTATE HELD FOR INVESTM_12
REAL ESTATE HELD FOR INVESTMENT - Park Highland Purchase and Sale Contracts (Details) - Park Highlands - Disposed of by Sale $ in Millions | Jun. 22, 2022 USD ($) a | May 31, 2022 USD ($) | Feb. 23, 2022 USD ($) | Mar. 10, 2022 USD ($) a | Nov. 11, 2021 USD ($) a |
Real Estate Properties [Line Items] | |||||
Area of land (in acres) | a | 67 | 77 | |||
Sale price | $ | $ 55 | $ 52.9 | |||
Deposits on real estate sales | $ | $ 3 | $ 3.5 | |||
Undeveloped Land | |||||
Real Estate Properties [Line Items] | |||||
Area of land (in acres) | a | 234 | ||||
Area of land to be sold, original (in acres) | a | 238 | ||||
Area of land to be sold, amendment (in acres) | a | 4 | ||||
Sale price | $ | $ 124.5 | ||||
Deposits on real estate sales | $ | $ 13.5 |
REAL ESTATE EQUITY SECURITIES_2
REAL ESTATE EQUITY SECURITIES (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Investments, Debt and Equity Securities [Abstract] | ||||
Net (loss) gain recognized during the period on real estate equity securities | $ (20,070) | $ 4,800 | $ (27,591) | $ 15,553 |
Less net gain recognized during the period on real estate equity securities sold during the period | 0 | 0 | 0 | (225) |
Unrealized (loss) gain recognized during the reporting period on real estate equity securities held at the end of the period | $ (20,070) | $ 4,800 | $ (27,591) | $ 15,328 |
NOTES AND BONDS PAYABLE - Sched
NOTES AND BONDS PAYABLE - Schedule of Long-term Debt Instruments (Details) - USD ($) $ in Thousands | 6 Months Ended | |||||
Jul. 29, 2022 | Jul. 01, 2022 | Jun. 30, 2022 | Jul. 15, 2022 | Dec. 31, 2021 | Jun. 30, 2021 | |
Debt Instrument [Line Items] | ||||||
Total Notes and Bonds Payable principal outstanding | $ 1,060,304 | $ 1,015,491 | ||||
Discount on Notes and Bonds Payable, net | (9,636) | (8,146) | ||||
Deferred financing costs, net | (10,639) | (8,396) | ||||
Notes and bonds payable, net | 1,040,029 | 998,949 | ||||
Funded amount | $ 1,060,304 | |||||
Oakland City Center Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Interest rate, effective percentage | 2.18% | |||||
Mortgages | Richardson Portfolio Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 19,055 | 28,470 | ||||
Interest rate, effective percentage | 4.30% | |||||
Mortgages | Richardson Portfolio Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 2.50% | |||||
Mortgages | Park Centre Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 26,185 | 26,185 | ||||
Interest rate, effective percentage | 3.55% | |||||
Mortgages | Park Centre Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 1.75% | |||||
Mortgages | 1180 Raymond Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 31,070 | 31,070 | ||||
Interest rate, effective percentage | 3.83% | |||||
Mortgages | 1180 Raymond Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 2.25% | |||||
Mortgages | Crown Pointe Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 53,758 | 52,315 | ||||
Interest rate, effective percentage | 3.80% | |||||
Guarantees as percent of outstanding loan balance | 25% | |||||
Amount under guarantees | $ 21,900 | |||||
Mortgages | Crown Pointe Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 2.30% | |||||
Mortgages | Marquette Plaza Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 61,556 | 61,874 | ||||
Interest rate, effective percentage | 3.35% | |||||
Mortgages | Marquette Plaza Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 1.55% | |||||
Mortgages | Eight & Nine Corporate Centre Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 48,295 | 48,545 | ||||
Interest rate, effective percentage | 3.40% | |||||
Mortgages | Eight & Nine Corporate Centre Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 1.60% | |||||
Mortgages | Georgia 400 Center Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 61,154 | 61,154 | ||||
Interest rate, effective percentage | 3.35% | |||||
Mortgages | Georgia 400 Center Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 1.55% | |||||
Mortgages | PORT Mortgage Loan 1 | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 51,303 | 51,302 | ||||
Contractual interest rate, percentage | 4.74% | |||||
Interest rate, effective percentage | 4.74% | |||||
Mortgages | PORT Mortgage Loan 2 | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 10,523 | 10,523 | ||||
Contractual interest rate, percentage | 4.72% | |||||
Interest rate, effective percentage | 4.72% | |||||
Mortgages | MetLife Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 60,000 | 60,000 | ||||
Contractual interest rate, percentage | 3.90% | |||||
Interest rate, effective percentage | 3.90% | |||||
Mortgages | Springmaid Beach Resort Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 53,054 | 55,491 | ||||
Contractual interest rate, percentage | 5.77% | |||||
Interest rate, effective percentage | 5.75% | |||||
Mortgages | Springmaid Beach Resort Mortgage Loan | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Funded amount | $ 53,100 | |||||
Mortgages | Springmaid Beach Resort Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.25% | |||||
Contractual interest rate, percentage | 2.25% | |||||
Mortgages | Q and C Hotel Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 24,904 | 25,000 | ||||
Interest rate, effective percentage | 4.50% | |||||
Mortgages | Q and C Hotel Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 2.50% | |||||
Contractual interest rate, percentage | 2.50% | |||||
Mortgages | Lincoln Court Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 32,491 | 34,623 | ||||
Interest rate, effective percentage | 4.05% | |||||
Mortgages | Lincoln Court Mortgage Loan | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Face amount | $ 39,400 | |||||
Funded amount | $ 35,300 | |||||
Mortgages | Lincoln Court Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 2.25% | |||||
Mortgages | Lincoln Court Mortgage Loan | SOFR | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 3.25% | |||||
Mortgages | Lofts at NoHo Commons Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 74,536 | 74,536 | ||||
Interest rate, effective percentage | 3.98% | |||||
Mortgages | Lofts at NoHo Commons Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 2.18% | |||||
Mortgages | 210 West 31st Street Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 6,000 | 8,850 | ||||
Interest rate, effective percentage | 4.80% | |||||
Mortgages | 210 West 31st Street Mortgage Loan | Subsequent Event | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, periodic payment | $ 1,000 | |||||
Mortgages | 210 West 31st Street Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Contractual interest rate, percentage | 3% | |||||
Mortgages | Oakland City Center Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 95,415 | 96,075 | ||||
Interest rate, effective percentage | 3.55% | |||||
Mortgages | Oakland City Center Mortgage Loan | One-month LIBOR | ||||||
Debt Instrument [Line Items] | ||||||
Basis spread on variable rate | 1.75% | |||||
Contractual interest rate, percentage | 1.75% | |||||
Mortgages | Madison Square Mortgage Loan | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 17,649 | 17,500 | ||||
Contractual interest rate, percentage | 4.63% | |||||
Interest rate, effective percentage | 4.63% | |||||
Bonds Payable | Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures | ||||||
Debt Instrument [Line Items] | ||||||
Notes payable, net | $ 333,356 | $ 271,978 | ||||
Contractual interest rate, percentage | 3.93% | |||||
Interest rate, effective percentage | 3.93% |
NOTES AND BONDS PAYABLE - Addit
NOTES AND BONDS PAYABLE - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Aug. 12, 2022 | Apr. 04, 2022 | Dec. 31, 2021 | |
Debt Instrument [Line Items] | |||||||
Interest expense | $ 10,780 | $ 10,680 | $ 20,343 | $ 20,618 | |||
Amortization of Debt Issuance Costs | 800 | 800 | 1,600 | 1,600 | |||
Amortization of discount on bond and notes payable | 1,200 | 1,000 | 2,300 | 1,400 | |||
Interest payable | 7,900 | 7,900 | $ 6,600 | ||||
Debt obligations, next twelve months | 227,395 | 227,395 | |||||
Georgia 400 Center Mortgage Loan | Mortgages | |||||||
Debt Instrument [Line Items] | |||||||
Deposits paid | $ 20,400 | ||||||
Forecast | |||||||
Debt Instrument [Line Items] | |||||||
Debt obligations, next twelve months | $ 467,500 | ||||||
Extension options of debt obligations outstanding that are scheduled to mature over the next 12 months | $ 258,800 | ||||||
Undeveloped Land | |||||||
Debt Instrument [Line Items] | |||||||
Interest capitalized | $ 500 | $ 500 | $ 1,026 | $ 1,104 |
NOTES AND BONDS PAYABLE - Sch_2
NOTES AND BONDS PAYABLE - Schedule of Maturities of Long-term Debt (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Notes and Bonds Payable [Abstract] | |
July 1, 2022 through December 31, 2022 | $ 306,320 |
2023 | 227,395 |
2024 | 128,767 |
2025 | 216,180 |
2026 | 181,642 |
Thereafter | 0 |
Notes and bond payable outstanding | $ 1,060,304 |
NOTES AND BONDS PAYABLE - Israe
NOTES AND BONDS PAYABLE - Israeli Bond Financing (Details) - Bonds Payable - Series B Debentures ₪ in Millions, $ in Millions | May 02, 2022 ILS (₪) | May 02, 2022 USD ($) | Nov. 01, 2021 ILS (₪) | Nov. 01, 2021 USD ($) | Feb. 16, 2020 ILS (₪) | Feb. 16, 2020 USD ($) |
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | ₪ 254.1 | $ 74.1 | ||||
Contractual Interest Rate | 3.93% | 3.93% | ||||
Principal of installment payments as percent of face amount | 33.33% | |||||
Public Offering | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | ₪ 536.4 | |||||
Debt Instrument, Percent of Discount at Issuance | 2.60% | |||||
Proceeds from issuance of debt | ₪ 522.4 | $ 166.8 | ||||
Private Offering | ||||||
Debt Instrument [Line Items] | ||||||
Maximum borrowing capacity | ₪ 320.4 | ₪ 53.6 | ||||
Debt Instrument, Percent of Discount at Issuance | 4% | 3.10% | ||||
Proceeds from issuance of debt | ₪ 307.6 | $ 95.3 | ₪ 52 | $ 16.7 |
FAIR VALUE DISCLOSURES - Schedu
FAIR VALUE DISCLOSURES - Schedule of Face Value, Carrying Amounts and Fair Value (Details) - USD ($) | Jun. 30, 2022 | Dec. 31, 2021 |
Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes and bond payable, Face Value | $ 726,948,000 | $ 743,513,000 |
Series B Debentures | Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes and bond payable, Face Value | 333,356,000 | 271,978,000 |
Carrying Amount | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes and bond payable, Value | 724,395,000 | 740,176,000 |
Carrying Amount | Series B Debentures | Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes and bond payable, Value | 315,634,000 | 258,773,000 |
Fair Value | Level 3 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes and bond payable, Value | 718,214,000 | 740,347,000 |
Fair Value | Series B Debentures | Pacific Oak SOR (BVI) Holdings, Ltd. Series B Debentures | Level 1 | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Notes and bond payable, Value | $ 314,530,000 | $ 274,697,000 |
FAIR VALUE DISCLOSURES - Sche_2
FAIR VALUE DISCLOSURES - Schedule of Assets and Liabilities at Fair Value (Details) - Recurring Basis - USD ($) $ in Thousands | Jun. 30, 2022 | Dec. 31, 2021 |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate equity securities | $ 84,505 | $ 112,096 |
Asset derivative | 8 | |
Interest Rate Cap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Asset derivative | 784 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate equity securities | 84,505 | 112,096 |
Asset derivative | 0 | |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest Rate Cap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Asset derivative | 0 | |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate equity securities | 0 | 0 |
Asset derivative | 8 | |
Significant Other Observable Inputs (Level 2) | Interest Rate Cap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Asset derivative | 784 | |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate equity securities | 0 | 0 |
Asset derivative | $ 0 | |
Significant Unobservable Inputs (Level 3) | Interest Rate Cap | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Asset derivative | $ 0 |
RELATED PARTY TRANSACTIONS - Ad
RELATED PARTY TRANSACTIONS - Additional Information (Details) - USD ($) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||
Jun. 24, 2022 | Nov. 01, 2019 | Jul. 31, 2022 | Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | ||||||||
Period of termination of advisory agreement without cause or penalty | 60 days | |||||||
Contributions to joint venture | $ 22,500 | $ 4,024 | ||||||
Due from affiliates | $ 1,800 | 1,800 | $ 7,000 | |||||
Redemptions of common stock | $ 1,685 | $ 582 | 2,274 | $ 1,436 | ||||
PORT OP LP | BPT Holdings, LLC | ||||||||
Related Party Transaction [Line Items] | ||||||||
Common equity units received in transaction (in units) | 510,816 | |||||||
Share price (in dollars per share) | $ 13.09 | |||||||
PORT OP LP | BPT Holdings, LLC | Subsequent Event | ||||||||
Related Party Transaction [Line Items] | ||||||||
Redemptions of common stock | $ 6,700 | |||||||
PORT OP LP | BPT Holdings, LLC | PORT OP | ||||||||
Related Party Transaction [Line Items] | ||||||||
Ownership interest | 3.20% | |||||||
PORT OP LP | BPT Holdings, LLC | PORT OP | Subsequent Event | ||||||||
Related Party Transaction [Line Items] | ||||||||
Ownership percentage | 100% | |||||||
William Joint Venture | ||||||||
Related Party Transaction [Line Items] | ||||||||
Contributions to joint venture | $ 1,200 |
RELATED PARTY TRANSACTIONS - Co
RELATED PARTY TRANSACTIONS - Costs (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | Dec. 31, 2021 | |
Related Party Transaction [Line Items] | |||||
Payable as of | $ 12,343 | $ 12,343 | $ 1,903 | ||
Pacific Oak Capital Advisors LLC | |||||
Related Party Transaction [Line Items] | |||||
Capitalized | 3,322 | $ 3,909 | 6,680 | $ 8,392 | |
Payable as of | 5,656 | 5,656 | 1,903 | ||
Pacific Oak Capital Advisors LLC | Asset management fees | |||||
Related Party Transaction [Line Items] | |||||
Expensed | 3,189 | 3,527 | 6,315 | 7,380 | |
Payable as of | 5,656 | 5,656 | 1,903 | ||
Pacific Oak Capital Advisors LLC | Property management fee | |||||
Related Party Transaction [Line Items] | |||||
Expensed | 133 | 123 | 258 | 243 | |
Payable as of | 0 | 0 | 0 | ||
Pacific Oak Capital Advisors LLC | Disposition fees | |||||
Related Party Transaction [Line Items] | |||||
Expensed | 0 | 504 | 107 | 504 | |
Payable as of | 0 | 0 | 0 | ||
Pacific Oak Capital Advisors LLC | Change in subordinated performance fee due upon termination to affiliate | |||||
Related Party Transaction [Line Items] | |||||
Expensed | 0 | (261) | 0 | 200 | |
Pacific Oak Capital Advisors LLC | Acquisition fees on real estate | |||||
Related Party Transaction [Line Items] | |||||
Capitalized | 0 | 0 | 0 | 20 | |
Payable as of | 0 | 0 | 0 | ||
Pacific Oak Capital Advisors LLC | Acquisition fee on investment in unconsolidated entities | |||||
Related Party Transaction [Line Items] | |||||
Capitalized | 0 | $ 16 | 0 | $ 45 | |
Payable as of | $ 0 | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS - In
RELATED PARTY TRANSACTIONS - Investment in Pacific Oak Opportunity Zone Fund I (Details) - Pacific Oak Opportunity Zone Fund I - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jun. 30, 2022 | Jun. 30, 2021 | |
Schedule of Equity Method Investments [Line Items] | ||||
Investments, fair value | $ 27.4 | $ 27.4 | ||
Acquisition fee, percent of purchase price fee | 1.50% | |||
Investment, purchase price, benchmark | $ 25 | |||
Acquisition fee of purchase price fee in excess of benchmark purchase price | 1% | |||
Asset management fee, percent | 0.25% | 0.25% | ||
Financing fee as percent of original principal amount of any indebtedness | 0.50% | 0.50% | ||
Waived asset management fees | $ 0.1 | $ 0.2 | $ 0.2 | $ 0.3 |
Asset management fees receivable | $ 0 | $ 0 |
RELATED PARTY TRANSACTIONS - PO
RELATED PARTY TRANSACTIONS - PORT II (Details) - PORT II OP LP - USD ($) $ in Millions | 6 Months Ended | |
Aug. 31, 2020 | Jun. 30, 2022 | |
Schedule of Equity Method Investments [Line Items] | ||
Payments to acquire investments | $ 22.5 | |
Application fee collected, percent | 100% | |
Insufficient fund fees, percent | 50% | |
Tier 1 | ||
Schedule of Equity Method Investments [Line Items] | ||
Base fee, percent of rent collections per year | 8% | |
Tier 1 | Maximum | ||
Schedule of Equity Method Investments [Line Items] | ||
Base fee, benchmark of rent collections per year | $ 50 | |
Tier 2 | ||
Schedule of Equity Method Investments [Line Items] | ||
Base fee, percent of rent collections per year | 7% | |
Tier 2 | Maximum | ||
Schedule of Equity Method Investments [Line Items] | ||
Base fee, benchmark of rent collections per year | $ 75 | |
Tier 2 | Minimum | ||
Schedule of Equity Method Investments [Line Items] | ||
Base fee, benchmark of rent collections per year | $ 50 | |
Tier 3 | ||
Schedule of Equity Method Investments [Line Items] | ||
Base fee, percent of rent collections per year | 6% | |
Tier 3 | Minimum | ||
Schedule of Equity Method Investments [Line Items] | ||
Base fee, benchmark of rent collections per year | $ 75 | |
PORT II OP LP | ||
Schedule of Equity Method Investments [Line Items] | ||
Payments to acquire investments | $ 34 |
INVESTMENT IN UNCONSOLIDATED _3
INVESTMENT IN UNCONSOLIDATED ENTITIES - Investments in Unconsolidated Joint Ventures (Details) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 USD ($) property | Dec. 31, 2021 USD ($) | |
Schedule of Equity Method Investments [Line Items] | ||
Investment Balance | $ 107,339 | $ 88,256 |
110 William Joint Venture | ||
Schedule of Equity Method Investments [Line Items] | ||
Number of real estate properties | property | 1 | |
Ownership % | 60% | |
Investment Balance | $ 0 | 0 |
353 Sacramento Joint Venture | ||
Schedule of Equity Method Investments [Line Items] | ||
Number of real estate properties | property | 1 | |
Ownership % | 55% | |
Investment Balance | $ 47,377 | 49,916 |
Pacific Oak Opportunity Zone Fund I | ||
Schedule of Equity Method Investments [Line Items] | ||
Number of real estate properties | property | 3 | |
Investment Balance | $ 27,356 | 27,215 |
Ownership % | 46% | |
PORT II OP LP | ||
Schedule of Equity Method Investments [Line Items] | ||
Number of real estate properties | property | 588 | |
Investment Balance | $ 32,606 | $ 11,125 |
Ownership % | 94.20% |
INVESTMENT IN UNCONSOLIDATED _4
INVESTMENT IN UNCONSOLIDATED ENTITIES - PORT II (Details) - PORT II OP LP $ in Thousands | 3 Months Ended | 6 Months Ended | |||
May 12, 2022 USD ($) property | Jun. 30, 2022 USD ($) shares | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) shares | Jun. 30, 2021 USD ($) | |
Schedule of Equity Method Investments [Line Items] | |||||
Investment acquired (in shares) | shares | 600 | 600 | |||
Cumulative percentage ownership after all transactions | 94.20% | ||||
Payments to acquire investments | $ 22,500 | ||||
Gain (loss) on investments | $ (400) | $ (12) | $ (500) | $ (12) | |
Michigan | Single-family Home | |||||
Schedule of Equity Method Investments [Line Items] | |||||
Home portfolio, number of homes | property | 283 | ||||
Purchase price | $ 80,300 |
SUPPLEMENTAL CASH FLOW AND SI_3
SUPPLEMENTAL CASH FLOW AND SIGNIFICANT NONCASH TRANSACTION DISCLOSURES (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2022 | Jun. 30, 2021 | |
Supplemental Disclosure of Cash Flow Information: | ||
Interest paid, net of capitalized interest of $1,026 and $1,104 for the six months ended June 30, 2022 and 2021, respectively | $ 15,446 | $ 17,571 |
Supplemental Disclosure of Significant Noncash Transactions: | ||
Accrued improvements to real estate | 3,262 | 6,075 |
Redeemable common stock payable | 1,429 | |
Distributions paid to common stockholders through common stock issuances | $ 99,094 | $ 0 |
REPORTING SEGMENTS (Details)
REPORTING SEGMENTS (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | |||||
Jun. 30, 2022 USD ($) segment | Jun. 30, 2021 USD ($) segment | Jun. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) property | Jun. 30, 2022 USD ($) segment | Jun. 30, 2021 USD ($) segment | Dec. 31, 2021 USD ($) | |
Segment Reporting [Abstract] | |||||||
Number of reportable segments | 3 | 3 | 3 | 3 | 3 | ||
Income Statement [Abstract] | |||||||
Total revenues | $ 43,539 | $ 44,488 | $ 82,065 | $ 83,430 | |||
Total expenses | (29,636) | (59,256) | (70,629) | (102,687) | |||
Total other (loss) income | (22,272) | 36,526 | (24,536) | 47,055 | |||
Net (loss) income | (8,369) | 21,758 | (13,100) | 27,798 | |||
Assets and Liabilities held for Sale | |||||||
Total assets | 1,613,455 | 1,613,455 | $ 1,613,455 | $ 1,613,455 | $ 1,584,619 | ||
Goodwill | 13,534 | 13,534 | 13,534 | 13,534 | 13,534 | ||
Strategic Opportunistic Properties | |||||||
Income Statement [Abstract] | |||||||
Total revenues | 24,884 | 29,075 | 51,750 | 60,136 | |||
Total expenses | (13,699) | (43,932) | (40,776) | (75,528) | |||
Total other (loss) income | (21,797) | 36,459 | (26,387) | 46,964 | |||
Net (loss) income | (10,612) | 21,602 | (15,413) | 31,572 | |||
Assets and Liabilities held for Sale | |||||||
Total assets | 1,234,238 | 1,234,238 | 1,234,238 | 1,234,238 | 1,223,122 | ||
Goodwill | 9,489 | 9,489 | 9,489 | $ 9,489 | 9,489 | ||
Single-Family Homes | |||||||
Segment Reporting [Abstract] | |||||||
Number of reportable segments | segment | 1 | ||||||
Income Statement [Abstract] | |||||||
Total revenues | 5,801 | 5,564 | 11,544 | 10,870 | |||
Total expenses | (6,505) | (6,999) | (13,009) | (13,183) | |||
Total other (loss) income | (479) | 54 | (521) | 78 | |||
Net (loss) income | (1,183) | (1,381) | (1,986) | (2,235) | |||
Assets and Liabilities held for Sale | |||||||
Total assets | 227,704 | 227,704 | 227,704 | $ 227,704 | 211,050 | ||
Goodwill | 0 | 0 | 0 | $ 0 | 0 | ||
Hotels | |||||||
Segment Reporting [Abstract] | |||||||
Number of reportable segments | segment | 1 | ||||||
Income Statement [Abstract] | |||||||
Total revenues | 12,854 | 9,849 | 18,771 | 12,424 | |||
Total expenses | (9,432) | (8,325) | (16,844) | (13,976) | |||
Total other (loss) income | 4 | 13 | 2,372 | 13 | |||
Net (loss) income | 3,426 | $ 1,537 | 4,299 | $ (1,539) | |||
Assets and Liabilities held for Sale | |||||||
Total assets | 151,513 | 151,513 | 151,513 | $ 151,513 | 150,447 | ||
Goodwill | $ 4,045 | $ 4,045 | $ 4,045 | $ 4,045 | $ 4,045 |
PORT MEZZANINE EQUITY - Reconci
PORT MEZZANINE EQUITY - Reconciliation (Details) $ in Thousands | 6 Months Ended | ||
Jul. 01, 2020 USD ($) property shares | Jun. 30, 2022 USD ($) shares | Jun. 30, 2021 USD ($) shares | |
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Roll Forward] | |||
Balance (in shares) | shares | 94,141,251 | ||
Balance | $ 482,059 | $ 519,712 | |
Balance | $ 461,373 | $ 545,300 | |
Balance (in shares) | shares | 104,319,092 | ||
PORT OP LP | Battery Point | BPT Holdings, LLC | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Roll Forward] | |||
Common equity units received in transaction (in units) | shares | 510,816 | ||
Percent of outstanding common equity units received in transaction | 4.50% | ||
Common equity units received in transaction | $ 3,000 | ||
Redemption period | 1 year | ||
Battery Point | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Roll Forward] | |||
Shares acquired during period (in shares) | shares | 1,000,000 | ||
Single-family Home | Battery Point | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Roll Forward] | |||
Number of homes | property | 559 | ||
Preferred Stock | Preferred Class A | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Roll Forward] | |||
Balance (in shares) | shares | 15,000 | 15,000 | |
Balance | $ 15,134 | $ 15,134 | |
Dividends Available Upon Redemption | 672 | 453 | |
Dividends Paid | (672) | (453) | |
Balance | $ 15,134 | $ 15,134 | |
Balance (in shares) | shares | 15,000 | 15,000 | |
Preferred Stock | Preferred Class B | |||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest [Roll Forward] | |||
Balance (in shares) | shares | 125 | 125 | |
Balance | $ 99 | $ 99 | |
Dividends Available Upon Redemption | 8 | 0 | |
Dividends Paid | (8) | 0 | |
Balance | $ 99 | $ 99 | |
Balance (in shares) | shares | 125 | 125 |
PORT MEZZANINE EQUITY - Redeema
PORT MEZZANINE EQUITY - Redeemable Non-controlling Interest Activities (Details) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2022 | Jun. 30, 2021 | Jul. 01, 2020 | |
Redeemable Noncontrolling Interest, Equity, Common, Carrying Amount [Roll Forward] | |||
Beginning balance | $ 2,822 | ||
Adjustment to value of redeemable noncontrolling interest | 3,946 | ||
Ending balance | 0 | ||
PORT OP LP | Battery Point | BPT Holdings, LLC | |||
Redeemable Noncontrolling Interest, Equity, Common, Carrying Amount [Roll Forward] | |||
Beginning balance | 2,822 | $ 2,968 | |
Net loss attributable to redeemable noncontrolling interest | (81) | (81) | |
Ending balance | $ 6,687 | $ 2,887 | |
Common equity units received in transaction (in units) | 510,816 |
COMMITMENTS AND CONTINGENCIES -
COMMITMENTS AND CONTINGENCIES - Additional Information (Details) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
May 25, 2019 | May 25, 2016 | Jun. 30, 2022 USD ($) property | Jun. 30, 2021 USD ($) | Jun. 30, 2022 USD ($) property | Jun. 30, 2021 USD ($) | |
Loss Contingencies [Line Items] | ||||||
Remaining lease term | 91 years 6 months | 91 years 6 months | ||||
Encore Hospitality, LLC | Q and C Hotel | ||||||
Loss Contingencies [Line Items] | ||||||
Term agreement, extension period | 5 years | |||||
Base fee as percentage of gross revenue | 4% | |||||
Management agreement, fees accrued | $ 100 | $ 50 | $ 200 | $ 100 | ||
Marriott International | Q and C Hotel | ||||||
Loss Contingencies [Line Items] | ||||||
Brand services fee as percent of total room revenue | 2% | |||||
Fees incurred to management agreement | 300 | 100 | $ 500 | 200 | ||
Brand services fee as percent of total room revenue, after three years | 5% | |||||
Monthly marketing fund contribution fees as percent of gross room sales | 1.50% | |||||
Doubletree Management LLC | Springmaid Beach Resort | ||||||
Loss Contingencies [Line Items] | ||||||
Base fee as percentage of total operating revenue in year one | 2.50% | |||||
Base fee as percentage of total operating revenue in year two | 2.75% | |||||
Base fee as percentage of total operating revenue, thereafter | 3% | |||||
Management fee as percent of any campground revenue | 2% | |||||
Incentive fee as percent of operating cash flow | 15% | |||||
Percent of total investments | 12% | |||||
Brand services fee as percent of total room revenue | 4% | |||||
Fees incurred to management agreement | $ 300 | $ 200 | $ 400 | $ 300 | ||
Hotel | ||||||
Loss Contingencies [Line Items] | ||||||
Number of real estate properties | property | 2 | 2 |
COMMITMENTS AND CONTINGENCIES_2
COMMITMENTS AND CONTINGENCIES - Lease Cost (Details) $ in Thousands | 3 Months Ended | 6 Months Ended |
Jun. 30, 2022 USD ($) | Jun. 30, 2022 USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | ||
Right-of-use asset (included in real estate held for investment, net) | $ 8,074 | $ 8,074 |
Lease obligation (included in other liabilities) | $ 9,403 | $ 9,403 |
Remaining lease term | 91 years 6 months | 91 years 6 months |
Discount rate | 4.80% | 4.80% |
Interest on lease obligation for the period ended June 30, 2022 | $ 111 | $ 223 |
COMMITMENTS AND CONTINGENCIES_3
COMMITMENTS AND CONTINGENCIES - Future Minimum Lease Payments (Details) $ in Thousands | Jun. 30, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
July 1, 2021 through December 31, 2021 | $ 180 |
2022 | 360 |
2023 | 360 |
2024 | 393 |
2025 | 396 |
Thereafter | 52,167 |
Total expected minimum lease obligations | 53,856 |
Less: Amount representing interest | (44,453) |
Present value of net minimum lease payments | $ 9,403 |
SUBSEQUENT EVENTS - PORT II Rec
SUBSEQUENT EVENTS - PORT II Reconsideration (Details) $ / shares in Units, $ in Thousands | Jul. 01, 2022 USD ($) property $ / shares shares | Jul. 29, 2022 | Jun. 30, 2022 USD ($) | Dec. 31, 2021 USD ($) |
Subsequent Event [Line Items] | ||||
Real estate held for investment, net | $ 1,194,479 | $ 1,209,243 | ||
Subsequent Event | PORT II OP LP | ||||
Subsequent Event [Line Items] | ||||
Number of shares purchased (in shares) | shares | 76,735 | |||
Stock repurchased during period (in dollars per share) | $ / shares | $ 14.66 | |||
Notes payable, net | $ 82,600 | |||
Subsequent Event | PORT II OP LP | Single-Family Homes | ||||
Subsequent Event [Line Items] | ||||
Real estate held for investment, net | $ 135,100 | |||
Number of units in real estate property | property | 588 | |||
Subsequent Event | PORT II OP LP | PORT II OP LP | ||||
Subsequent Event [Line Items] | ||||
Ownership percentage | 100% |
SUBSEQUENT EVENTS - Springmaid
SUBSEQUENT EVENTS - Springmaid Beach Resort Purchase and Sale Contract (Details) - USD ($) $ in Thousands | Jul. 15, 2022 | Jun. 30, 2022 |
Business Acquisition [Line Items] | ||
Outstanding amount | $ 1,060,304 | |
Subsequent Event | Mortgages | Springmaid Beach Resort Mortgage Loan | ||
Business Acquisition [Line Items] | ||
Outstanding amount | $ 53,100 | |
Subsequent Event | Hotel | Springmaid Beach Resort | Disposed of by Sale | ||
Business Acquisition [Line Items] | ||
Consideration | 91,000 | |
Nonrefundable buyer's deposit | $ 2,000 |