Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Jun. 30, 2016 | Aug. 10, 2016 | |
Class of Stock [Line Items] | ||
Entity Registrant Name | NorthStar/RXR New York Metro Real Estate, Inc. | |
Entity Central Index Key | 1,603,671 | |
Entity Current Reporting Status | Yes | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Non-accelerated Filer | |
Amendment Flag | false | |
Document Type | 10-Q | |
Document Period End Date | Jun. 30, 2016 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q2 | |
Class A | ||
Class of Stock [Line Items] | ||
Entity Common Stock, Shares Outstanding | 353,559 | |
Class T | ||
Class of Stock [Line Items] | ||
Entity Common Stock, Shares Outstanding | 25,064 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | 6 Months Ended | ||
Jun. 30, 2016 | Dec. 31, 2015 | ||
Assets | |||
Cash | $ 672,644 | $ 2,201,007 | |
Investment in unconsolidated venture, at fair value | 1,896,379 | 0 | |
Total assets | [1] | 2,569,023 | 2,201,007 |
Liabilities | |||
Due to related party | 95,731 | 20,000 | |
Distribution payable | 2,153 | 0 | |
Total liabilities | [1] | 97,884 | 20,000 |
NorthStar/RXR New York Metro Real Estate, Inc. Stockholders’ Equity | |||
Preferred stock, $0.01 par value, 50,000,000 shares authorized, no shares issued and outstanding as of June 30, 2016 and December 31, 2015 | 0 | 0 | |
Additional paid-in capital | 2,612,127 | 2,178,587 | |
Retained earnings (accumulated deficit) | (145,060) | (999) | |
Total NorthStar/RXR New York Metro Real Estate, Inc. stockholders’ equity | 2,470,193 | 2,180,008 | |
Non-controlling interest | 946 | 999 | |
Total equity | 2,471,139 | 2,181,007 | |
Total liabilities and equity | $ 2,569,023 | 2,201,007 | |
Primary Beneficiary | |||
NorthStar/RXR New York Metro Real Estate, Inc. Stockholders’ Equity | |||
VIE ownership interest | 99.96% | ||
Class A common | |||
NorthStar/RXR New York Metro Real Estate, Inc. Stockholders’ Equity | |||
Common stock | $ 2,953 | 2,420 | |
Class T common | |||
NorthStar/RXR New York Metro Real Estate, Inc. Stockholders’ Equity | |||
Common stock | $ 173 | $ 0 | |
[1] | Represents the consolidated assets and liabilities of NorthStar/RXR Operating Partnership, LP (the “Operating Partnership”). The Operating Partnership is a consolidated variable interest entity (“VIE”), of which the Company is the sole general partner and owns approximately 99.96%. As of June 30, 2016, the assets and liabilities of the Operating Partnership did not include any consolidated VIEs. Refer to Note 2, “Summary of Significant Accounting Policies”. |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parentheticals) - $ / shares | Jun. 30, 2016 | Dec. 31, 2015 |
Class of Stock [Line Items] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (shares) | 50,000,000 | 50,000,000 |
Preferred stock, shares issued (shares) | 0 | 0 |
Preferred stock, shares outstanding (shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | |
Common stock, shares authorized (shares) | 400,000,000 | |
Class A common | ||
Class of Stock [Line Items] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 120,000,000 | 120,000,000 |
Common stock, shares issued (shares) | 295,290 | 242,003 |
Common stock, shares outstanding (shares) | 295,290 | 242,003 |
Class T common | ||
Class of Stock [Line Items] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (shares) | 280,000,000 | 280,000,000 |
Common stock, shares issued (shares) | 17,317 | 0 |
Common stock, shares outstanding (shares) | 17,317 | 0 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) - USD ($) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2016 | Jun. 30, 2016 | |
Expenses | ||
Asset management and other fees - related party | $ 117,168 | $ 117,168 |
General and administrative expenses | 19,952 | 20,130 |
Total expenses | 137,120 | 137,298 |
Other income (loss) | ||
Unrealized gain (loss) on unconsolidated venture | (3,621) | (3,621) |
Net income (loss) | (140,741) | (140,919) |
Net (income) loss attributable to non-controlling interest | 53 | 53 |
Net income (loss) attributable to NorthStar/RXR New York Metro Real Estate, Inc. common stockholders | $ (140,688) | $ (140,866) |
Net income (loss) per share, basic/diluted (in dollars per share) | $ (0.54) | $ (0.56) |
Weighted average number of shares outstanding, basic/diluted (shares) | 259,810 | 250,907 |
Distributions declared per share of common stock (in dollars per share) | $ 0.01 | $ 0.01 |
CONSOLIDATED STATEMENTS OF EQUI
CONSOLIDATED STATEMENTS OF EQUITY - USD ($) | Total | Class A | Class T | Total Company’s Stockholders’ Equity | Common StockClass A | Common StockClass T | Additional Paid-in Capital | Retained Earnings (Accumulated Deficit) | Non-controlling Interests |
Beginning Balance (shares) at Dec. 31, 2014 | 22,223 | 0 | |||||||
Beginning Balance at Dec. 31, 2014 | $ 201,007 | $ 200,007 | $ 222 | $ 0 | $ 199,785 | $ 0 | $ 1,000 | ||
Increase (Decrease) in Stockholder's Equity | |||||||||
Net proceeds from issuance of common stock (shares) | 219,780 | 219,780 | |||||||
Net proceeds from issuance of common stock | 1,981,000 | $ 2,000,000 | 1,981,000 | $ 2,198 | 1,978,802 | ||||
Net income (loss) | (1,000) | (999) | (999) | (1) | |||||
Ending Balance (shares) at Dec. 31, 2015 | 242,003 | 0 | 242,003 | 0 | |||||
Ending Balance at Dec. 31, 2015 | 2,181,007 | 2,180,008 | $ 2,420 | $ 0 | 2,178,587 | (999) | 999 | ||
Increase (Decrease) in Stockholder's Equity | |||||||||
Net proceeds from issuance of common stock (shares) | 30,787 | 17,317 | 30,787 | 17,317 | |||||
Net proceeds from issuance of common stock | 424,761 | $ 300,000 | $ 200,000 | 424,761 | $ 308 | $ 173 | 424,280 | ||
Issuance and amortization of equity-based compensation (shares) | 22,500 | ||||||||
Issuance and amortization of equity based-based compensation | 9,479 | 9,479 | $ 225 | 9,254 | |||||
Dividends declared | (3,195) | (3,195) | (3,195) | ||||||
Proceeds from distribution reinvestment plan | 6 | 6 | 6 | ||||||
Net income (loss) | (140,919) | (140,866) | (140,866) | (53) | |||||
Ending Balance (shares) at Jun. 30, 2016 | 295,290 | 17,317 | 295,290 | 17,317 | |||||
Ending Balance at Jun. 30, 2016 | $ 2,471,139 | $ 2,470,193 | $ 2,953 | $ 173 | $ 2,612,127 | $ (145,060) | $ 946 |
CONSOLIDATED STATEMENT OF CASH
CONSOLIDATED STATEMENT OF CASH FLOWS (Unaudited) | 3 Months Ended | 6 Months Ended |
Jun. 30, 2016USD ($) | Jun. 30, 2016USD ($) | |
Cash flows from operating activities: | ||
Net income (loss) | $ (140,741) | $ (140,919) |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities: | ||
Amortization of equity-based compensation | 9,479 | |
Unrealized (gain) loss on unconsolidated venture | 3,621 | 3,621 |
Changes in assets and liabilities: | ||
Due to related party | 62,811 | |
Net cash provided by (used in) operating activities | (65,008) | |
Cash flows from investing activities: | ||
Investment in unconsolidated venture | (1,900,000) | |
Net cash provided by (used in) investing activities | (1,900,000) | |
Cash flows from financing activities: | ||
Net proceeds from issuance of common stock | 437,681 | |
Distributions paid on common stock | (1,042) | |
Proceeds from distribution reinvestment plan | 6 | |
Net cash provided by (used in) financing activities | 436,645 | |
Net increase (decrease) in cash | (1,528,363) | |
Cash - beginning of period | 2,201,007 | |
Cash - end of period | 672,644 | 672,644 |
Supplemental disclosure of non-cash financing activities: | ||
Accrued cost of capital | 12,920 | 12,920 |
Distribution payable | $ 2,153 | $ 2,153 |
Business and Organization
Business and Organization | 6 Months Ended |
Jun. 30, 2016 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Business and Organization | Business and Organization NorthStar/RXR New York Metro Real Estate, Inc. (the “Company”) was formed to acquire a high-quality commercial real estate (“CRE”) portfolio concentrated in the New York metropolitan area and, in particular New York City, with a focus on office, mixed-use properties and a lesser emphasis on multifamily properties. The Company intends to complement this strategy by originating and acquiring: (i) CRE debt including, subordinate loans and participations in such loans and preferred equity interests; and (ii) joint ventures and partnership interests in CRE related investments. The Company was formed on March 21, 2014 as a Maryland corporation and intends to make an election to qualify as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), commencing with the taxable year ending December 31, 2016 . The Company is externally managed by NSAM J-NS/RXR Ltd (the “Advisor”), a subsidiary of the Company’s co-sponsor NorthStar Asset Management Group Inc. (NYSE: NSAM). NSAM provides asset management and other services to publicly-traded REITs including NorthStar Realty Finance Corp. (NYSE: NRF) (“NorthStar Realty”) and NorthStar Realty Europe Corp. (NYSE: NRE), NSAM’s sponsored companies that raise capital through the retail market, as well as any future sponsored companies, including funds, joint ventures and partnerships both in the United States and internationally. The Company is sub-advised by RXR NTR Sub-Advisor LLC (the “Sub-Advisor”), a Delaware limited liability company and a subsidiary of the Company’s co-sponsor, RXR Realty LLC (“RXR”). RXR is a leading real estate owner, manager and developer in the New York metropolitan area. The Advisor and Sub-Advisor are collectively referred to as the Advisor Entities. The Company, the Advisor and the Sub-Advisor entered into a sub-advisory agreement delegating certain investment responsibilities of the Advisor to the Sub-Advisor. NSAM and RXR are collectively referred to as the Co-Sponsors. The Company’s dealer manager for the offering, NorthStar Securities, LLC (the “Dealer Manager”) is an affiliate of the Advisor and a subsidiary of NSAM. In June 2016, NSAM announced that it entered into a definitive merger agreement with NorthStar Realty and Colony Capital, Inc. (“Colony”), providing for the combination of NSAM, NorthStar Realty and Colony into a wholly-owned subsidiary of NSAM, as the surviving publicly-traded company for the combined organization that, upon and following the effective time of the mergers, will be named Colony NorthStar, Inc. (“Colony NorthStar”). As a result of the mergers, Colony NorthStar will be an internally-managed equity REIT, with a diversified real estate and investment management platform. In addition, following the mergers, the Advisor and NorthStar Securities, LLC (the “Dealer Manager”) will be subsidiaries of Colony NorthStar. This transaction is expected to close in January 2017, subject to customary closing conditions, including regulatory approvals, and approval by the NSAM’s, NorthStar Realty’s and Colony’s respective shareholders. There is no guarantee this transaction will close on the contemplated terms or within the anticipated timeframe, or at all. The Company does not expect that this transaction will have a material impact on its operations. Substantially all business of the Company will be conducted through NorthStar/RXR Operating Partnership, LP (the “Operating Partnership”). The Company is the sole general partner and a limited partner of the Operating Partnership. NorthStar/RXR NTR OP Holdings LLC (the “Special Unit Holder”) (a joint venture between the Co-Sponsors) has invested $1,000 in the Operating Partnership and has been issued a separate class of limited partnership units (the “Special Units”), which is recorded as its non-controlling interest on the consolidated balance sheets. As the Company accepts subscriptions for shares, it will transfer substantially all of the net proceeds from the continuous, public offering to the Operating Partnership as a capital contribution. The Company’s charter authorizes the issuance of up to 400,000,000 shares of common stock with a par value of $0.01 per share and up to 50,000,000 shares of preferred stock with a par value of $0.01 per share. Of the total shares of common stock authorized 120,000,000 are classified as Class A shares (“Class A Shares”) and 280,000,000 are classified as Class T shares (“Class T Shares”). The board of directors of the Company is authorized to amend its charter, without the approval of the stockholders, to increase or decrease the aggregate number of shares of capital stock or the number of shares of any class or series that the Company has authority to issue or to classify and reclassify any unissued shares of common stock into one or more classes or series. On March 28, 2014, as part of its formation, the Company issued 16,667 shares of common stock to NorthStar Realty and 5,556 shares of common stock to a subsidiary of RXR for $0.2 million , all of which were subsequently renamed Class A shares. On February 9, 2015 , the Company’s registration statement on Form S-11 with the U.S. Securities and Exchange Commission (the “SEC”) was declared effective to offer a minimum of $2,000,000 and a maximum of $2,000,000,000 in shares of common stock in a continuous, public offering, of which up to $1,800,000,000 can be offered pursuant to its primary offering (the “Primary Offering”) at a purchase price of $10.1111 per Class A Share and $9.5538 per Class T Share and up to $200,000,000 pursuant to its distribution reinvestment plan (the “DRP”) at a purchase price of $9.81 per Class A Share and $9.27 per Class T Share. The Primary Offering and the DRP are herein collectively referred to as the Offering. The Company retained the Dealer Manager to serve as the dealer manager for the Primary Offering. The Dealer Manager is also responsible for marketing the shares being offered pursuant to the Primary Offering. The board of directors of the Company has the right to reallocate shares between the Primary Offering and the DRP. On December 23, 2015 , the Company commenced operations by satisfying the minimum offering requirement in the Primary Offering as a result of NorthStar Realty and RXR purchasing $1.5 million and $0.5 million in Class A Shares of common stock, respectively. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Basis of Quarterly Presentation The accompanying unaudited consolidated financial statements and related notes of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial reporting and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and note disclosures normally included in the consolidated financial statements prepared under U.S. GAAP have been condensed or omitted. In the opinion of management, all adjustments considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 , which was filed with the SEC. Principles of Consolidation The consolidated financial statements include the accounts of the Company, the Operating Partnership and their consolidated subsidiaries. The Company consolidates variable interest entities (“VIEs”), if any, where the Company is the primary beneficiary and voting interest entities which are generally majority owned or otherwise controlled by the Company. All significant intercompany balances are eliminated in consolidation as of June 30, 2016 and December 31, 2015 . Variable Interest Entities A VIE is an entity that lacks one or more of the characteristics of a voting interest entity. A VIE is defined as an entity in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The determination of whether an entity is a VIE includes both a qualitative and quantitative analysis. The Company bases its qualitative analysis on its review of the design of the entity, its organizational structure including decision-making ability and relevant financial agreements and the quantitative analysis on the forecasted cash flow of the entity. The Company reassesses its initial evaluation of an entity as a VIE upon the occurrence of certain reconsideration events. A VIE must be consolidated only by its primary beneficiary, which is defined as the party who, along with its affiliates and agents has both the: (i) power to direct the activities that most significantly impact the VIE’s economic performance; and (ii) obligation to absorb the losses of the VIE or the right to receive the benefits from the VIE, which could be significant to the VIE. The Company determines whether it is the primary beneficiary of a VIE by considering qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIE’s economic performance and which party controls such activities; the amount and characteristics of its investment; the obligation or likelihood for the Company or other interests to provide financial support; consideration of the VIE’s purpose and design, including the risks the VIE was designed to create and pass through to its variable interest holders and the similarity with and significance to the business activities of the Company and the other interests. The Company reassesses its determination of whether it is the primary beneficiary of a VIE each reporting period. Significant judgments related to these determinations include estimates about the current and future fair value and performance of investments held by these VIEs and general market conditions. The Company evaluates its investments and financings, including investments in unconsolidated ventures and securitization financing transactions, if any, to determine whether each investment or financing is a VIE. The Company analyzes new investments and financings, as well as reconsideration events for existing investments and financings, which vary depending on type of investment or financing. The Company adopted the new consolidation guidance (refer to Recent Accounting Pronouncements) on January 1, 2016 which resulted in the identification of the Operating Partnership as a VIE. Prior to the adoption of the standard, the Operating Partnership was consolidated under the voting interest model. The Operating Partnership is a VIE because the non-controlling interests do not have substantive kick-out or participating rights and is consolidated because the Company controls all of its significant business activities. As of June 30, 2016 , the Company identified unconsolidated VIEs related to its investment in an unconsolidated venture. Based on management’s analysis, the Company determined that it is not the primary beneficiary and accordingly the VIEs are not consolidated in the Company’s financial statements as of June 30, 2016 . The Company did not provide financial support to its unconsolidated VIEs during the six months ended June 30, 2016 . As of June 30, 2016 , there were no explicit arrangements or implicit variable interests that could require the Company to provide financial support to its unconsolidated VIEs. The Company’s maximum exposure to loss as of June 30, 2016 would not exceed its investment in the VIEs. Voting Interest Entities A voting interest entity is an entity in which the total equity investment at risk is sufficient to enable it to finance its activities independently and the equity holders have the power to direct the activities of the entity that most significantly impact its economic performance, the obligation to absorb the losses of the entity and the right to receive the residual returns of the entity. The usual condition for a controlling financial interest in a voting interest entity is ownership of a majority voting interest. If the Company has a majority voting interest in a voting interest entity, the entity will generally be consolidated. The Company does not consolidate a voting interest entity if there are substantive participating rights by other parties and/or kick-out rights by a single party or a simple majority vote. The Company performs on-going reassessments of whether entities previously evaluated under the voting interest framework have become VIEs, based on certain events, and therefore subject to the VIE consolidation framework. Investments in Unconsolidated Ventures A non-controlling, unconsolidated ownership interest in an entity may be accounted for using the equity method, at fair value or the cost method. Under the equity method, the investment is adjusted each period for capital contributions and distributions and its share of the entity’s net income (loss). Capital contributions, distributions and net income (loss) of such entities are recorded in accordance with the terms of the governing documents. An allocation of net income (loss) may differ from the stated ownership percentage interest in such entity as a result of preferred returns and allocation formulas, if any, as described in such governing documents. Equity method investments are recognized using a cost accumulation model in which the investment is recognized based on the cost to the investor, which includes acquisition fees. The Company expenses certain acquisition costs and fees associated with consolidated investments deemed to be business combinations and capitalizes these costs for investments deemed to be acquisitions of an asset, including an equity method investment. The Company may account for an investment in an unconsolidated entity at fair value by electing the fair value option. The Company may record the change in fair value for its share of the projected future cash flow or may follow the practical expedient of the net asset value (“NAV”) of the underlying fund investment based on the most recent available information. The Company has elected the fair value option to account for its investment in an unconsolidated venture. The Company will record the change in fair value from one period to another in unrealized gain (loss) on unconsolidated venture on the consolidated statements of operations. The Company may account for an investment that does not qualify for equity method accounting or for which the fair value option was not elected using the cost method if the Company determines the investment in the unconsolidated entity is insignificant. Under the cost method, equity in earnings is recorded as dividends are received to the extent they are not considered a return of capital, which is recorded as a reduction of cost of the investment. Non-controlling Interests A non-controlling interest in a consolidated subsidiary is defined as the portion of the equity (net assets) in a subsidiary not attributable, directly or indirectly, to the Company. A non-controlling interest is required to be presented as a separate component of equity on the consolidated balance sheets and presented separately as net income (loss) and comprehensive income (loss) attributable to controlling and non-controlling interests. An allocation to a non-controlling interest may differ from the stated ownership percentage interest in such entity as a result of a preferred return and allocation formula, if any, as described in such governing documents. Estimates The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that could affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates and assumptions. Comprehensive Income (Loss) The Company had no items of other comprehensive income (loss) (“OCI”), so its comprehensive income (loss) is the same as the net income (loss) for all periods presented. Operating Real Estate The Company will account for purchases of operating real estate that qualify as business combinations using the acquisition method, where the purchase price is allocated to tangible assets such as land, building, improvements and other identified intangibles. Major replacements and betterments which improve or extend the life of the asset will be capitalized and depreciated over their useful life. Ordinary repairs and maintenance will be expensed as incurred. Operating real estate will be carried at historical cost less accumulated depreciation. Operating real estate will be depreciated using the straight-line method over the estimated useful life of the assets. Construction costs incurred in connection with the Company’s investments will be capitalized and included in operating real estate, net on the consolidated balance sheets. Construction in progress will not be depreciated until the development is substantially completed. Costs directly related to an acquisition deemed to be a business combination will be expensed and included in transaction costs in the consolidated statements of operations. The Company will evaluate whether a real estate acquisition constitutes a business and whether business combination accounting is appropriate. As of June 30, 2016 , the Company did not own any operating real estate investments. Real Estate Debt Investments CRE debt investments are generally intended to be held to maturity and, accordingly, will be carried at cost, net of unamortized loan fees, premium and discount. CRE debt investments that are deemed to be impaired will be carried at amortized cost less a loan loss reserve, if deemed appropriate, which approximates fair value. CRE debt investments where the Company does not intend to hold the loan for the foreseeable future or until its expected payoff will be classified as held for sale and recorded at the lower of cost or estimated value. As of June 30, 2016 , the Company did not own any debt investments. Real Estate Securities The Company will classify its CRE securities investments as available for sale on the acquisition date, which will be carried at fair value. Unrealized gains (losses) will be recorded as a component of accumulated OCI in the consolidated statements of equity. However, the Company may elect the fair value option for certain of its available for sale securities, and as a result, any unrealized gains (losses) on such securities will be recorded in unrealized gain (loss) on investments and other in the consolidated statements of operations. As of June 30, 2016 , the Company did not own any securities investments. Acquisition Fees and Expenses The total of all acquisition fees and expenses for an investment, including acquisition fees to the Advisor Entities, cannot exceed, in the aggregate, 6.0% of the contract purchase price of such investment unless such excess is approved by a majority of the directors, including independent directors. For the six months ended June 30, 2016 , total acquisition fees and expenses did not exceed the allowed limit for any investment. An acquisition fee incurred related to an equity investment will generally be expensed as incurred. An acquisition fee paid to the Advisor Entities related to the acquisition of an equity or debt investment in an unconsolidated joint venture is included in investments in unconsolidated ventures on the consolidated balance sheets when the fair value option is not elected for the investment, but is expensed as incurred when the fair value option is elected. An acquisition fee paid to the Advisor Entities related to the origination or acquisition of debt investments is included in debt investments, net on the consolidated balance sheets and is amortized to interest income over the life of the investment using the effective interest method. The Company records as an expense certain acquisition costs and fees associated with transactions deemed to be business combinations in which it consolidates the asset and capitalizes these costs for transactions deemed to be acquisitions of an asset, including an equity investment. Revenue Recognition Operating Real Estate Rental and escalation income from operating real estate will be derived from leasing of space to various types of tenants. Rental revenue recognition commences when the tenant takes possession of the leased space and the leased space is substantially ready for its intended use. The leases will be for fixed terms of varying length and generally provide for annual rentals and expense reimbursements to be paid in monthly installments. Rental income from leases will be recognized on a straight-line basis over the term of the respective leases. The excess of rents recognized over amounts contractually due pursuant to the underlying leases will be included in unbilled rent receivable on the consolidated balance sheets. The Company will amortize any tenant inducements as a reduction of revenue utilizing the straight-line method over the term of the lease. Escalation income represents revenue from tenant/operator leases which provide for the recovery of all or a portion of the operating expenses and real estate taxes paid by the Company on behalf of the respective property. This revenue will be accrued in the same period as the expenses are incurred. In a situation in which a lease(s) associated with a significant tenant have been, or are expected to be, terminated early, the Company will evaluate the remaining useful life of depreciable or amortizable assets in the asset group related to the lease that will be terminated (i.e., tenant improvements, above- and below-market lease intangibles, in-place lease value and deferred leasing costs). Based upon consideration of the facts and circumstances surrounding the termination, the Company may write-off or accelerate the depreciation and amortization associated with the asset group. Such amounts will be included within depreciation and amortization in the consolidated statements of operations. Real Estate Debt Investments Interest income will be recognized on an accrual basis and any related premium, discount, origination costs and fees will be amortized over the life of the investment using the effective interest method. The amortization will be reflected as an adjustment to interest income in the consolidated statements of operations. The amortization of a premium or accretion of a discount will be discontinued if such loan is reclassified to held for sale. Real Estate Securities Interest income will be recognized using the effective interest method with any premium or discount amortized or accreted through earnings based on expected cash flow through the expected maturity date of the security. Changes to expected cash flow may result in a change to the yield which is then applied retrospectively for high-credit quality securities that cannot be prepaid or otherwise settled in such a way that the holder would not recover substantially all of the investment or prospectively for all other securities to recognize interest income. Credit Losses and Impairment on Investments Operating Real Estate The Company’s real estate portfolio will be reviewed on a quarterly basis, or more frequently as necessary, to assess whether there are any indicators that the value of its operating real estate may be impaired or that its carrying value may not be recoverable. A property’s value will be considered impaired if the Company’s estimate of the aggregate expected future undiscounted cash flow generated by the property is less than the carrying value. In conducting this review, the Company will consider U.S. macroeconomic factors, real estate sector, asset specific conditions and other factors. To the extent an impairment has occurred, the loss will be measured as the excess of the carrying value of the property over the estimated fair value and recorded in impairment on operating real estate in the consolidated statements of operations. An allowance for a doubtful account for a tenant receivable will be established based on a periodic review of aged receivables resulting from estimated losses due to the inability of tenants to make required rent and other payments contractually due. Additionally, the Company will establish, on a current basis, an allowance for future tenant credit losses on unbilled rent receivable based on an evaluation of the collectability of such amounts. Real Estate Debt Investments Loans will be considered impaired when, based on current information and events, it is probable that the Company will not be able to collect principal and interest amounts due according to the contractual terms. The Company will assess the credit quality of the portfolio and adequacy of loan loss reserves on a quarterly basis, or more frequently as necessary. Significant judgment of the Company will be required in this analysis. The Company will consider the estimated net recoverable value of the loan as well as other factors, including but not limited to the fair value of any collateral, the amount and the status of any senior debt, the quality and financial condition of the borrower and the competitive situation of the area where the underlying collateral is located. Because this determination will be based on projections of future economic events, which are inherently subjective, the amount ultimately realized may differ materially from the carrying value as of the balance sheet date. If upon completion of the assessment, the estimated fair value of the underlying collateral is less than the net carrying value of the loan, a loan loss reserve will be recorded with a corresponding charge to provision for loan losses. The loan loss reserve for each loan will be maintained at a level that is determined to be adequate by the Company to absorb probable losses. Income recognition will be suspended for a loan at the earlier of the date at which payments become 90 -days past due or when, in the opinion of the Company, a full recovery of income and principal becomes doubtful. When the ultimate collectability of the principal of an impaired loan is in doubt, all payments will be applied to principal under the cost recovery method. When the ultimate collectability of the principal of an impaired loan is not in doubt, contractual interest will be recorded as interest income when received, under the cash basis method until an accrual is resumed when the loan becomes contractually current and performance is demonstrated to be resumed. A loan will be written off when it is no longer realizable and/or legally discharged. Investments in Unconsolidated Ventures The Company will review its investments in unconsolidated ventures for which the Company did not elect the fair value option on a quarterly basis, or more frequently as necessary, to assess whether there are any indicators that the value may be impaired or that its carrying value may not be recoverable. An investment is considered impaired if the projected net recoverable amount over the expected holding period is less than the carrying value. In conducting this review, the Company will consider U.S. and global macroeconomic factors, including real estate sector conditions, together with investment specific and other factors. To the extent an impairment has occurred and is considered to be other than temporary, the loss will be measured as the excess of the carrying value of the investment over the estimated fair value and recorded in equity in earnings (losses) of unconsolidated ventures in the consolidated statements of operations. Real Estate Securities CRE securities for which the fair value option is elected are not evaluated for other-than-temporary impairment (“OTTI”) as any change in fair value is recorded in the consolidated statements of operations. Realized losses on such securities are reclassified to realized gain (loss) on investments and other as losses occur. CRE securities for which the fair value option is not elected will be evaluated for OTTI quarterly. Impairment of a security is considered to be other-than-temporary when: (i) the holder has the intent to sell the impaired security; (ii) it is more likely than not the holder will be required to sell the security; or (iii) the holder does not expect to recover the entire amortized cost of the security. When a CRE security has been deemed to be other-than-temporarily impaired due to (i) or (ii), the security is written down to its fair value and an OTTI is recognized in the consolidated statements of operations. In the case of (iii), the security is written down to its fair value and the amount of OTTI is then bifurcated into: (a) the amount related to expected credit losses; and (b) the amount related to fair value adjustments in excess of expected credit losses. The portion of OTTI related to expected credit losses will be recognized in the consolidated statements of operations. The remaining OTTI related to the valuation adjustment will be recognized as a component of accumulated OCI in the consolidated statements of equity. The portion of OTTI recognized through earnings will be accreted back to the amortized cost basis of the security through interest income, while amounts recognized through OCI are amortized over the life of the security with no impact on earnings. CRE securities which are not high-credit quality will be considered to have an OTTI if the security has an unrealized loss and there has been an adverse change in expected cash flow. The amount of OTTI is then bifurcated as discussed above. Organization and Offering Costs The Advisor Entities, or their affiliates, are entitled to receive reimbursement for organization and offering costs paid on behalf of the Company in connection with the Offering. The Company is obligated to reimburse the Advisor Entities, or their affiliates, as applicable, for organization and offering costs to the extent the aggregate of selling commissions, dealer manager fees, distribution fees and other organization and offering costs do not exceed 15.0% of gross offering proceeds from the Offering. The Advisor Entities do not expect reimbursable organization and offering costs, excluding selling commissions, dealer manager fees and distribution fees, to exceed $18.0 million , or approximately 1.0% of the total proceeds available to be raised from the Offering. The Company records organization and offering costs each period based upon an allocation determined by the expectation of total organization and offering costs to be reimbursed. Organization costs are recorded as an expense in general and administrative expenses in the consolidated statements of operations and offering costs are recorded as a reduction to equity. I ncome Taxes The Company intends to elect to be taxed as a REIT under the Internal Revenue Code and intends to operate as such, commencing with the taxable year in which the Company satisfies the minimum offering requirement. The Company expects to have little or no taxable income prior to electing REIT status. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the Company’s annual REIT taxable income to its stockholders (which is computed without regard to the dividends-paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with U.S. GAAP). As a REIT, the Company generally will not be subject to federal income tax to the extent it distributes qualifying dividends to its stockholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Such an event could materially adversely affect the Company’s net income and net cash available for distribution to stockholders. However, the Company intends to organize and operate in such a manner as to qualify for treatment as a REIT. Other Refer to Note 2 of the consolidated financial statements in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 for further disclosure of the Company’s significant accounting policies. Recent Accounting Pronouncements In May 2014, the Financial Accounting Standards Board (“FASB”) issued an accounting update requiring a company to recognize as revenue the amount of consideration it expects to be entitled to in connection with the transfer of promised goods or services to customers. The accounting standard update will replace most of the existing revenue recognition guidance currently promulgated by U.S. GAAP. In July 2015, the FASB decided to delay the effective date of the new revenue standard by one year. The effective date of the new revenue standard for the Company will be January 1, 2018. The Company is in the process of evaluating the impact, if any, of the update on its consolidated financial position, results of operations and financial statement disclosures. In February 2015, the FASB issued updated guidance that changes the rules regarding consolidation. The pronouncement eliminates specialized guidance for limited partnerships and similar legal entities and removes the indefinite deferral for certain investment funds. The new guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, with early adoption permitted. The Company adopted this guidance in the first quarter 2016 and determined the Company’s Operating Partnership is considered a VIE. The Company is the primary beneficiary of the VIE, the VIE’s assets can be used for purposes other than the settlement of the VIE’s obligations and the Company’s partnership interest is considered a majority voting interest. As such, this standard did not have a material impact on the Company’s consolidated financial position or results of operations. In January 2016, the FASB issued an accounting update that addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The Company is currently assessing the impact, if any, of the guidance on the Company’s consolidated financial position, results of operations and financial statement disclosures. In February 2016, the FASB issued an accounting update that requires lessees to present right-of-use assets and lease liabilities on the balance sheet. The new guidance is to be applied using a modified retrospective approach at the beginning of the earliest comparative period in the financial statements and is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. In March 2016, the FASB issued guidance which eliminates the requirement for an investor to retroactively apply the equity method when its increase in ownership interest (or degree of influence) in an investee triggers equity method accounting. The update requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment become qualified for equity method accounting. The update should be applied prospectively upon their effective date to increases in the level of ownership interests or degree of influence that results in the adoption of the equity method. The guidance is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. In March 2016, the FASB issued guidance which amends several aspects of the accounting for equity-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The guidance is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. In June 2016, the FASB issued guidance which changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. Additionally, entities will have to disclose significantly more information including information used to track credit quality by year of origination for most financing receivables. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. |
Investment in Unconsolidated Ve
Investment in Unconsolidated Venture | 6 Months Ended |
Jun. 30, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Investment in Unconsolidated Venture | Investment in Unconsolidated Venture The following is a description of the Company’s investment in an unconsolidated venture, which the Company has elected to account for under the fair value method. 1285 Avenue of the Americas Venture On May 20, 2016 , the Company, through a subsidiary of its operating partnership, completed the acquisition of a non-controlling interest in 1285 Avenue of the Americas (“1285 AoA”), a 1.8 million square foot Class-A office building located in midtown Manhattan for a purchase price of approximately $1.9 million , including closing costs. The acquisition was part of an approximately $1.65 billion transaction sourced by RXR, the Company’s co-sponsor and affiliate of its Sub-Advisor. The purchase of the 1285 AoA interest was financed by the purchasers with $1.1 billion of acquisition financing and an additional $100.0 million future funding facility, with a seven -year term at a weighted average fixed interest rate of approximately 4.3% per annum. The purchase was approved by the Company’s board of directors, including all of its independent directors. As of June 30, 2016 , the carrying value of the Company’s investment was $1.9 million . For the three and six months ended June 30, 2016 , the Company recognized approximately $4,000 in unrealized loss and received no cash distributions. |
Related Party Arrangements
Related Party Arrangements | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Party Arrangements | Related Party Arrangements Advisor Entities Subject to certain restrictions and limitations, the Advisor Entities are responsible for managing the Company’s affairs on a day-to-day basis and for identifying, acquiring, originating and asset managing investments on behalf of the Company. The Advisor Entities may delegate certain of their obligations to affiliated entities, which may be organized under the laws of the United States or foreign jurisdictions. References to the Advisor Entities include the Advisor Entities and any such affiliated entities. For such services, to the extent permitted by law and regulations, the Advisor Entities receive fees and reimbursements from the Company, of which the Sub-Advisor generally receives 50% of all fees and up to 25% of all reimbursements. In June 2016, the Company’s advisory agreement with the Advisor was renewed for an additional one -year term commencing on June 30, 2016 , and accordingly, the term of the Company’s sub-advisory agreement with the Sub-Advisor was also extended for one year. Both agreements were renewed on terms identical to those in effect through June 30, 2016 . The Company pays the Sub-Advisor, or its affiliates, development, leasing, property management and construction related service fees that are usual and customary for owners and operators in the geographic area of the property. Below is a description and table of the fees and reimbursements incurred to the Advisor Entities. Fees to Advisor Entities Asset Management Fee The Advisor Entities receive a monthly asset management fee equal to one-twelfth of 1.25% of the sum of the amount funded or allocated for CRE investments, including expenses and any financing attributable to such investments, less any principal received on debt and securities investments (or the proportionate share thereof in the case of an investment made through a joint venture). Incentive Fee The Advisor, or its affiliates, is entitled to receive distributions equal to 15.0% of net cash flows of the Company, whether from continuing operations, repayment of loans, disposition of assets or otherwise, but only after stockholders have received, in the aggregate, cumulative distributions equal to their invested capital plus a 6.0% cumulative, non-compounded annual pre-tax return on such invested capital. Acquisition Fee The Advisor Entities also receive fees for providing structuring, diligence, underwriting advice and related services in connection with real estate acquisitions equal to 2.25% of each real estate property acquired by the Company, including acquisition costs and any financing attributable to an equity investment (or the proportionate share thereof in the case of an indirect equity investment made through a joint venture or other investment vehicle) and 1.0% of the amount funded or allocated by the Company to acquire or originate CRE debt investments, including acquisition costs and any financing attributable to such investments (or the proportionate share thereof in the case of an indirect investment made through a joint venture or other investment vehicle). An acquisition fee incurred related to an equity investment is generally expensed as incurred. A fee paid to the Advisor Entities in connection with the acquisition of an equity or CRE debt investment in an unconsolidated joint venture is generally included in investments in unconsolidated ventures on the consolidated balance sheets when the fair value option is not elected for the investment, but is expensed as incurred when the fair value option is elected. A fee paid to the Advisor Entities in connection with the origination or acquisition of CRE debt investments is included in CRE debt investments, net on the consolidated balance sheets and is amortized to interest income over the life of the investment using the effective interest method. Disposition Fee For substantial assistance in connection with the sale of investments and based on the services provided, as determined by the Company’s independent directors, the Advisor Entities receive a disposition fee equal to 2.0% of the contract sales price of each property sold and 1.0% of the contract sales price of each CRE debt investment sold or syndicated. The Company does not pay a disposition fee upon the maturity, prepayment, workout, modification or extension of a CRE debt investment unless there is a corresponding fee paid by the borrower, in which case the disposition fee is the lesser of: (i) 1.0% of the principal amount of the CRE debt investment prior to such transaction; or (ii) the amount of the fee paid by the borrower in connection with such transaction. If the Company takes ownership of a property as a result of a workout or foreclosure of a CRE debt investment, the Company will pay a disposition fee upon the sale of such property. A disposition fee from the sale of an investment is generally expensed and included in asset management and other fees - related party in the Company’s consolidated statements of operations. A disposition fee for a CRE debt investment incurred in a transaction other than a sale is included in CRE debt investments, net on the consolidated balance sheets and is amortized to interest income over the life of the investment using the effective interest method. Reimbursements to Advisor Entities Operating Costs The Advisor Entities are entitled to receive reimbursement for direct and indirect operating costs incurred by the Advisor Entities in connection with administrative services provided to the Company. The Advisor Entities allocate, in good faith, indirect costs to the Company related to the Advisor Entities and their affiliates’ employees, occupancy and other general and administrative costs and expenses in accordance with the terms of, and subject to the limitations contained in, the advisory agreement with the Advisor Entities. The indirect costs include the Company’s allocable share of the Advisor Entities compensation and benefit costs associated with dedicated or partially dedicated personnel who spend all or a portion of their time managing the Company’s affairs, based upon the percentage of time devoted by such personnel to the Company’s affairs. The indirect costs also include rental and occupancy, technology, office supplies, travel and entertainment and other general and administrative costs and expenses also allocated based on the percentage of time devoted by personnel to the Company’s affairs. However, there is no reimbursement for personnel costs related to executive officers (although there may be reimbursement for certain executive officers of the Advisor) and other personnel involved in activities for which the Advisor Entities receive an acquisition fee or a disposition fee. The Advisor Entities allocate these costs to the Company relative to its and its affiliates’ other managed companies in good faith and has reviewed the allocation with the Company’s board of directors, including its independent directors. The Advisor Entities update the board of directors on a quarterly basis of any material changes to the expense allocation and provide a detailed review to the board of directors, at least annually, and as otherwise requested by the board of directors. The Company reimburses the Advisor Entities quarterly for operating costs (including the asset management fee) based on a calculation for the four preceding fiscal quarters not to exceed the greater of: (i) 2.0% of its average invested assets; or (ii) 25.0% of its net income determined without reduction for any additions to reserves for depreciation, loan losses or other similar non-cash reserves and excluding any gain from the sale of assets for that period. Notwithstanding the above, the Company may reimburse the Advisor Entities for expenses in excess of this limitation if a majority of the Company’s independent directors determines that such excess expenses are justified based on unusual and non-recurring factors. The Company calculates the expense reimbursement quarterly based upon the trailing twelve -month period. Organization and Offering Costs The Advisor Entities are entitled to receive reimbursement for organization and offering costs paid on behalf of the Company in connection with the Offering. The Company is obligated to reimburse the Advisor Entities, as applicable, for organization and offering costs to the extent the aggregate of selling commissions, dealer manager fees, distribution fees and other organization and offering costs do not exceed 15% of gross proceeds from the Offering. The Advisor Entities do not expect reimbursable organization and offering costs, excluding selling commissions, dealer manager fees, and distribution fees, to exceed $18.0 million , or approximately 1.0% of the total proceeds available to be raised from the Primary Offering. The Company shall not reimburse the Advisor Entities for any organization and offering costs that the Company’s independent directors determine are not fair and commercially reasonable to the Company. The Company records organization and offering costs each period based on an allocation of expected total organization and offering costs to be reimbursed. Organization costs are recorded in general and administrative expenses in the consolidated statements of operations and offering costs were recorded as a reduction to equity. Dealer Manager Selling Commissions, Dealer Manager Fees, and Distribution Fees Pursuant to a dealer manager agreement, the Company pays the Dealer Manager selling commissions of up to 7.0% of gross proceeds from the sale of Class A Shares and up to 2.0% of the gross proceeds from the sale of Class T Shares issued in the Primary Offering, all of which are reallowed to participating broker-dealers. The Company pays the Dealer Manager a dealer manager fee of up to 3.0% of gross proceeds from the sale of Class A Shares and up to 2.75% of the gross proceeds from the sale of Class T Shares issued in the Primary Offering, a portion of which is typically reallowed to participating broker-dealers and paid to certain employees of the Dealer Manager. In addition, the Company pays the Dealer Manager a distribution fee of up to 1.0% annually of gross proceeds from the sale of Class T Shares issued in the Primary Offering, all of which are reallowed to participating broker-dealers. The Dealer Manager will cease receiving distribution fees with respect to each Class T Share upon the earliest of the following to occur: (i) a listing of the Company’s shares of common stock on a national securities exchange; (ii) such Class T Share is no longer being outstanding; (iii) the Dealer Manager’s determination that total underwriting compensation, with respect to all Class A Shares and Class T Shares would be in excess of 10% of the gross proceeds of the Primary Offering; or (iv) the end of the month in which total underwriting compensation, with respect to Class T Shares held by a stockholder within his or her particular account would be in excess of 10% of the stockholder’s total gross investment amount at the time of purchase of the primary Class T Shares held in such account. No selling commissions or dealer manager fees are paid for sales pursuant to the DRP or the Company’s distribution support agreement (“Distribution Support Agreement”). During the six months ended June 30, 2016 , $8,465 of distribution fees were recorded as a reduction to stockholders’ equity. As of June 30, 2016 , the estimated liability for the present value of the expected future distribution fees payable to the Dealer Manager, which is included in due to related party on the Company’s consolidated balance sheets, with an offset to additional paid-in capital, was $8,268 . Summary of Fees and Reimbursements The following table presents the fees and reimbursements incurred to the Advisor Entities and the Dealer Manager for the three and six months ended June 30, 2016 and the amount due to related party as of June 30, 2016 and December 31, 2015 : Three and Six Months Ended Due to Related Party as of Type of Fee or Reimbursement Financial Statement Location June 30, 2016 June 30, 2016 (Unaudited) December 31, 2015 Fees to Advisor Entities Asset management Asset management and other fees - related party $ 7,070 $ — $ — Acquisition (1) Asset management and other fees- related party 110,098 82,573 — Reimbursements to Advisor Entities Operating costs (2) General and administrative expenses 9,241 — — Organization (3) General and administrative expenses 238 238 1,000 Offering (3) Cost of capital (4) 4,521 4,521 19,000 Selling commissions / Dealer manager fees / Distribution fees Cost of capital (4) 38,394 8,399 — Total $ 169,562 $ 95,731 $ 20,000 _________________________________________________ (1) Acquisition fees related to investments in unconsolidated joint ventures are generally included in investments in unconsolidated ventures on the consolidated balance sheets when the fair value option is not elected for the investment, but is expensed as incurred when the fair value option is elected. The Advisor Entities may determine to defer fees or seek reimbursement. (2) As of June 30, 2016 , the Advisor Entities have incurred unreimbursed operating costs on behalf of the Company of $8.5 million , that remain eligible to allocate to the Company. (3) As of June 30, 2016 , the Advisor Entities have incurred unreimbursed organization and offering costs on behalf of the Company of $4.1 million , that remain eligible to allocate to the Company. (4) Cost of capital is included in net proceeds from issuance of common stock in the Company’s consolidated statements of equity. Distribution Support Agreement Pursuant to the Distribution Support Agreement, NorthStar Realty and RXR committed to purchase 75% and 25% , respectively, of up to an aggregate of $10.0 million in shares of the Company’s common stock at a current offering price for Class A shares, net of selling commissions and dealer manager fees, if cash distributions exceed modified funds from operations (as computed in accordance with the definition established by the Investment Program Association (“IPA”) and adjusted for certain items) to provide additional funds to support distributions to stockholders. On December 23, 2015 , NorthStar Realty and RXR purchased 164,835 and 54,945 shares of the Company’s Class A common stock for $1.5 million and $0.5 million , respectively, under the Distribution Support Agreement to satisfy the minimum offering requirement, which reduced the total commitment. For the six months ended June 30, 2016 , NorthStar Realty and RXR did not purchase any Class A shares of the Company’s common stock. NorthStar Realty and RXR In December 2013, NorthStar Realty entered into a strategic transaction with RXR. The investment in RXR includes an approximate 27% equity interest. NorthStar Realty’s equity interest in RXR is structured so that NSAM may be entitled to certain fees in connection with RXR’s investment management business. Investment in Unconsolidated Venture On May 20, 2016 , the Company, through a subsidiary of its operating partnership, completed the acquisition of a non-controlling interest in 1285 AoA, a 1.8 million square foot Class-A office building located in midtown Manhattan for a purchase price of approximately $1.9 million , including closing costs. The acquisition was part of an approximately $1.65 billion transaction sourced by RXR, the Company’s co-sponsor and affiliate of its sub-advisor. The purchase of the 1285 AoA interest was financed by the purchasers with $1.1 billion of acquisition financing and an additional $100.0 million future funding facility, with a seven -year term at a weighted average fixed interest rate of approximately 4.3% per annum. The purchase was approved by the Company’s board of directors, including all of its independent directors. |
Equity-Based Compensation
Equity-Based Compensation | 6 Months Ended |
Jun. 30, 2016 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Equity-Based Compensation | Equity-Based Compensation The Company adopted a long-term incentive plan (the “Plan”), which it may use to attract and retain qualified officers, directors, employees and consultants, as well as an independent directors compensation plan, which is a component of the Plan. All stock issued under the Plan will consist of Class A common stock unless the board of directors of the Company determines otherwise. The Company currently intends to issue awards only to its independent directors under the Plan. The Company will account for its equity-based compensation awards using the fair value method, which requires an estimate of fair value of the award at the time of grant. All fixed equity-based awards to directors, which have no vesting conditions other than time of service, will be amortized to compensation expense over the vesting period on a straight-line basis. Equity-based compensation will be recorded in general and administrative expenses in the consolidated statements of operations. Pursuant to the Plan, the Company granted Class A Shares of restricted common stock to its three independent directors concurrent with when the Company made its first investment in May 2016. As of June 30, 2016 , the Company’s independent directors were granted a cumulative total of 22,500 Class A shares of restricted common stock for an aggregate value of $0.2 million , based on the share price on the date of each grant. The restricted common stock granted will vest quarterly over two years. However, the stock will become fully vested on the earlier occurrence of: (i) the termination of the independent director’s service as a director due to his or her death or disability; or (ii) a change in control of the Company. The Company recognized equity-based compensation expense of $9,479 for the three and six months ended June 30, 2016 , related to the issuance of restricted stock to the independent directors, which was recorded in general and administrative expenses in the consolidated statements of operations. Unvested shares totaled 22,500 as of June 30, 2016 . |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Stockholders’ Equity Common Stock from Primary Offering For the six months ended June 30, 2016 , the Company issued 30,787 and 17,317 shares of Class A and Class T common stock, generating gross proceeds of $0.3 million and $0.2 million , respectively. For the year ended December 31, 2015 , the Company issued 219,780 shares of Class A common stock, generating gross proceeds of $2.0 million . From inception through June 30, 2016 , the Company issued 250,567 and 17,317 shares of Class A and Class T common stock, generating gross proceeds of $2.3 million and $0.2 million , respectively. Distribution Reinvestment Plan The Company adopted the DRP through which common stockholders may elect to reinvest an amount equal to the distributions declared on their shares in additional shares of the same class, in lieu of receiving cash distributions, at a price equal to $9.81 per Class A Share and $9.27 per Class T Share until the Company establishes an estimated value per share for each class of share. Once established, shares issued pursuant to the DRP will be priced at 97% of the estimated value per share for each class of the common stock, as determined by the Advisor Entities or other firms chosen for that purpose. Pursuant to amended FINRA Rule 2310, the Company expects to establish an estimated value per share for each class of share from and after 150 days following the second anniversary of breaking escrow in the offering and annually thereafter. No selling commissions, dealer manager fees or distribution fees are paid on shares issued pursuant to the DRP. The amount available for distributions on all Class T shares will be reduced by the amount of distribution fees payable with respect to the Class T shares issued in the Primary Offering. The board of directors of the Company may amend, suspend or terminate the DRP for any reason upon ten -days’ notice to participants, except that the Company may not amend the DRP to eliminate a participant’s ability to withdraw from the DRP. As of June 30, 2016 , the Company raised gross proceeds of $6 pursuant to the DRP. Distributions On May 11, 2016 , the board of directors of the Company approved a daily cash distribution of $0.000273224 per share of Class A common stock and $0.000273224 per share of Class T common stock less the distribution fees that are payable with respect to such Class T Shares, which is equivalent to an annualized distribution amount of $0.10 per share of the Company’s common stock, less the distribution fee on Class T Shares. Distributions are generally paid to stockholders on the first business day of the month following the month for which the distribution has accrued. The following table presents distributions declared for the six months ended June 30, 2016 : Distributions (1) Period Cash DRP Total January $ — $ — $ — February — — — March — — — April — — — May 1,036 6 1,042 June 2,139 14 2,153 Total $ 3,175 $ 20 $ 3,195 _________________________________________________ (1) Represents distributions declared for the period, even though such distributions are actually paid to stockholders the month following such period. Share Repurchase Program The Company adopted a share repurchase program that may enable stockholders to sell their shares to the Company in limited circumstances (the “Share Repurchase Program”). The Company may not repurchase shares unless a stockholder has held shares for one year. However, the Company may repurchase shares held less than one year in connection with a stockholder’s death or disability (as disability is defined in the Internal Revenue Code) and after receiving written notice from the stockholder or the stockholder’s estate. The Company is not obligated to repurchase shares pursuant to the Share Repurchase Program. The Company may amend, suspend or terminate the Share Repurchase Program at its discretion at any time, subject to certain notice requirements. Stock Distribution In April 2016, the board of directors of the Company approved special stock dividends to all common stockholders of record on the close of business on the earlier of: (a) the date by which the Company raises $100 million pursuant to this offering and (b) December 31, 2016 . The special stock dividend will be in an amount equal in value to 5.0% of the current gross offering price of each issued and outstanding Class A and Class T Share on the record date. The special stock dividends will be issued in shares of the same class as the shares on which the stock dividends are being made within 90 days following the record date. No selling commissions or dealer manager fees will be paid in connection with the issuance of the special stock dividends. |
Non-controlling Interests
Non-controlling Interests | 6 Months Ended |
Jun. 30, 2016 | |
Noncontrolling Interest [Abstract] | |
Non-controlling Interest | Non-controlling Interest Operating Partnership Non-controlling interest includes the special limited partnership interest in the Operating Partnership held by the Special Unit Holder and is recorded as its non-controlling interest on the consolidated balance sheets as of June 30, 2016 and December 31, 2015 . Income (loss) attributable to the non-controlling interest is based on the Special Unit Holder’s share of the Operating Partnership’s income (loss) and was an immaterial amount for the three and six months ended June 30, 2016 . |
Fair Value
Fair Value | 6 Months Ended |
Jun. 30, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Fair Value Fair Value Measurement The fair value of financial instruments is categorized based on the priority of the inputs to the valuation technique and categorized into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. Financial assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: Level 1. Quoted prices for identical assets or liabilities in an active market. Level 2. Financial assets and liabilities whose values are based on the following: a) Quoted prices for similar assets or liabilities in active markets. b) Quoted prices for identical or similar assets or liabilities in non-active markets. c) Pricing models whose inputs are observable for substantially the full term of the asset or liability. d) Pricing models whose inputs are derived principally from or corroborated by observable market data for substantially the full term of the asset or liability. Level 3. Prices or valuation techniques based on inputs that are both unobservable and significant to the overall fair value measurement. During the second quarter of 2016 the Company adopted guidance issued by the FASB that removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV as a practical expedient. Assets Measured at Fair Value on a Recurring Basis The following is a description of the valuation technique used to measure fair value of assets accounted for at fair value on a recurring basis and the general classification of the investment pursuant to the fair value hierarchy. Investment in Unconsolidated Venture The Company accounts for its investment in an unconsolidated venture at fair value based upon its share of the NAV of the underlying investment companies. The Company reviews the NAV provided by the underlying investment companies on an ongoing basis. As of June 30, 2016 , the fair value of the Company’s investment in an unconsolidated venture is $1.9 million . Because the Company utilizes NAV to determine fair value as a practical expedient, the Company will not present its investment in the unconsolidated venture within the fair value hierarchy. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Common Stock from Primary Offering For the period from July 1, 2016 through August 10, 2016 , the Company issued 58,264 and 7,746 shares of Class A and Class T common stock, representing gross proceeds of $0.6 million and $0.1 million , respectively. Distributions On August 11, 2016 , the board of directors of the Company approved a daily cash distribution of $0.000273224 per share of common stock for each of the three months ended December 31, 2016 . Distributions are generally paid to stockholders on the first business day of the month following the month for which the distribution was accrued. NorthStar Realty and RXR Purchase of Common Stock On August 11, 2016 , the Company’s board of directors approved the sale of 86 and 28 shares of the Company’s Class A common stock for $777 and $259 to NorthStar Realty and RXR, respectively, pursuant to the Distribution Support Agreement. |
Summary of Significant Accoun16
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2016 | |
Accounting Policies [Abstract] | |
Basis of Quarterly Presentation | The accompanying unaudited consolidated financial statements and related notes of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial reporting and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and note disclosures normally included in the consolidated financial statements prepared under U.S. GAAP have been condensed or omitted. In the opinion of management, all adjustments considered necessary for a fair presentation of the Company’s financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2015 , which was filed with the SEC. |
Principles of Consolidation | The consolidated financial statements include the accounts of the Company, the Operating Partnership and their consolidated subsidiaries. The Company consolidates variable interest entities (“VIEs”), if any, where the Company is the primary beneficiary and voting interest entities which are generally majority owned or otherwise controlled by the Company. |
Variable Interest Entities | A VIE is an entity that lacks one or more of the characteristics of a voting interest entity. A VIE is defined as an entity in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The determination of whether an entity is a VIE includes both a qualitative and quantitative analysis. The Company bases its qualitative analysis on its review of the design of the entity, its organizational structure including decision-making ability and relevant financial agreements and the quantitative analysis on the forecasted cash flow of the entity. The Company reassesses its initial evaluation of an entity as a VIE upon the occurrence of certain reconsideration events. A VIE must be consolidated only by its primary beneficiary, which is defined as the party who, along with its affiliates and agents has both the: (i) power to direct the activities that most significantly impact the VIE’s economic performance; and (ii) obligation to absorb the losses of the VIE or the right to receive the benefits from the VIE, which could be significant to the VIE. The Company determines whether it is the primary beneficiary of a VIE by considering qualitative and quantitative factors, including, but not limited to: which activities most significantly impact the VIE’s economic performance and which party controls such activities; the amount and characteristics of its investment; the obligation or likelihood for the Company or other interests to provide financial support; consideration of the VIE’s purpose and design, including the risks the VIE was designed to create and pass through to its variable interest holders and the similarity with and significance to the business activities of the Company and the other interests. The Company reassesses its determination of whether it is the primary beneficiary of a VIE each reporting period. Significant judgments related to these determinations include estimates about the current and future fair value and performance of investments held by these VIEs and general market conditions. The Company evaluates its investments and financings, including investments in unconsolidated ventures and securitization financing transactions, if any, to determine whether each investment or financing is a VIE. The Company analyzes new investments and financings, as well as reconsideration events for existing investments and financings, which vary depending on type of investment or financing. The Company adopted the new consolidation guidance (refer to Recent Accounting Pronouncements) on January 1, 2016 which resulted in the identification of the Operating Partnership as a VIE. Prior to the adoption of the standard, the Operating Partnership was consolidated under the voting interest model. The Operating Partnership is a VIE because the non-controlling interests do not have substantive kick-out or participating rights and is consolidated because the Company controls all of its significant business activities. |
Voting Interest Entities | A voting interest entity is an entity in which the total equity investment at risk is sufficient to enable it to finance its activities independently and the equity holders have the power to direct the activities of the entity that most significantly impact its economic performance, the obligation to absorb the losses of the entity and the right to receive the residual returns of the entity. The usual condition for a controlling financial interest in a voting interest entity is ownership of a majority voting interest. If the Company has a majority voting interest in a voting interest entity, the entity will generally be consolidated. The Company does not consolidate a voting interest entity if there are substantive participating rights by other parties and/or kick-out rights by a single party or a simple majority vote. The Company performs on-going reassessments of whether entities previously evaluated under the voting interest framework have become VIEs, based on certain events, and therefore subject to the VIE consolidation framework. |
Investments in Unconsolidated Ventures | A non-controlling, unconsolidated ownership interest in an entity may be accounted for using the equity method, at fair value or the cost method. Under the equity method, the investment is adjusted each period for capital contributions and distributions and its share of the entity’s net income (loss). Capital contributions, distributions and net income (loss) of such entities are recorded in accordance with the terms of the governing documents. An allocation of net income (loss) may differ from the stated ownership percentage interest in such entity as a result of preferred returns and allocation formulas, if any, as described in such governing documents. Equity method investments are recognized using a cost accumulation model in which the investment is recognized based on the cost to the investor, which includes acquisition fees. The Company expenses certain acquisition costs and fees associated with consolidated investments deemed to be business combinations and capitalizes these costs for investments deemed to be acquisitions of an asset, including an equity method investment. The Company may account for an investment in an unconsolidated entity at fair value by electing the fair value option. The Company may record the change in fair value for its share of the projected future cash flow or may follow the practical expedient of the net asset value (“NAV”) of the underlying fund investment based on the most recent available information. The Company has elected the fair value option to account for its investment in an unconsolidated venture. The Company will record the change in fair value from one period to another in unrealized gain (loss) on unconsolidated venture on the consolidated statements of operations. The Company may account for an investment that does not qualify for equity method accounting or for which the fair value option was not elected using the cost method if the Company determines the investment in the unconsolidated entity is insignificant. Under the cost method, equity in earnings is recorded as dividends are received to the extent they are not considered a return of capital, which is recorded as a reduction of cost of the investment. |
Non-controlling Interests | A non-controlling interest in a consolidated subsidiary is defined as the portion of the equity (net assets) in a subsidiary not attributable, directly or indirectly, to the Company. A non-controlling interest is required to be presented as a separate component of equity on the consolidated balance sheets and presented separately as net income (loss) and comprehensive income (loss) attributable to controlling and non-controlling interests. An allocation to a non-controlling interest may differ from the stated ownership percentage interest in such entity as a result of a preferred return and allocation formula, if any, as described in such governing documents. |
Estimates | The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that could affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates and assumptions. |
Comprehensive Income (Loss) | The Company had no items of other comprehensive income (loss) (“OCI”), so its comprehensive income (loss) is the same as the net income (loss) for all periods presented. |
Operating Real Estate | The Company will account for purchases of operating real estate that qualify as business combinations using the acquisition method, where the purchase price is allocated to tangible assets such as land, building, improvements and other identified intangibles. Major replacements and betterments which improve or extend the life of the asset will be capitalized and depreciated over their useful life. Ordinary repairs and maintenance will be expensed as incurred. Operating real estate will be carried at historical cost less accumulated depreciation. Operating real estate will be depreciated using the straight-line method over the estimated useful life of the assets. Construction costs incurred in connection with the Company’s investments will be capitalized and included in operating real estate, net on the consolidated balance sheets. Construction in progress will not be depreciated until the development is substantially completed. Costs directly related to an acquisition deemed to be a business combination will be expensed and included in transaction costs in the consolidated statements of operations. The Company will evaluate whether a real estate acquisition constitutes a business and whether business combination accounting is appropriate. |
Real Estate Debt Investments | CRE debt investments are generally intended to be held to maturity and, accordingly, will be carried at cost, net of unamortized loan fees, premium and discount. CRE debt investments that are deemed to be impaired will be carried at amortized cost less a loan loss reserve, if deemed appropriate, which approximates fair value. CRE debt investments where the Company does not intend to hold the loan for the foreseeable future or until its expected payoff will be classified as held for sale and recorded at the lower of cost or estimated value. |
Real Estate Securities | The Company will classify its CRE securities investments as available for sale on the acquisition date, which will be carried at fair value. Unrealized gains (losses) will be recorded as a component of accumulated OCI in the consolidated statements of equity. However, the Company may elect the fair value option for certain of its available for sale securities, and as a result, any unrealized gains (losses) on such securities will be recorded in unrealized gain (loss) on investments and other in the consolidated statements of operations. |
Acquisition Fees and Expenses | The total of all acquisition fees and expenses for an investment, including acquisition fees to the Advisor Entities, cannot exceed, in the aggregate, 6.0% of the contract purchase price of such investment unless such excess is approved by a majority of the directors, including independent directors. For the six months ended June 30, 2016 , total acquisition fees and expenses did not exceed the allowed limit for any investment. An acquisition fee incurred related to an equity investment will generally be expensed as incurred. An acquisition fee paid to the Advisor Entities related to the acquisition of an equity or debt investment in an unconsolidated joint venture is included in investments in unconsolidated ventures on the consolidated balance sheets when the fair value option is not elected for the investment, but is expensed as incurred when the fair value option is elected. An acquisition fee paid to the Advisor Entities related to the origination or acquisition of debt investments is included in debt investments, net on the consolidated balance sheets and is amortized to interest income over the life of the investment using the effective interest method. The Company records as an expense certain acquisition costs and fees associated with transactions deemed to be business combinations in which it consolidates the asset and capitalizes these costs for transactions deemed to be acquisitions of an asset, including an equity investment. |
Revenue Recognition | Operating Real Estate Rental and escalation income from operating real estate will be derived from leasing of space to various types of tenants. Rental revenue recognition commences when the tenant takes possession of the leased space and the leased space is substantially ready for its intended use. The leases will be for fixed terms of varying length and generally provide for annual rentals and expense reimbursements to be paid in monthly installments. Rental income from leases will be recognized on a straight-line basis over the term of the respective leases. The excess of rents recognized over amounts contractually due pursuant to the underlying leases will be included in unbilled rent receivable on the consolidated balance sheets. The Company will amortize any tenant inducements as a reduction of revenue utilizing the straight-line method over the term of the lease. Escalation income represents revenue from tenant/operator leases which provide for the recovery of all or a portion of the operating expenses and real estate taxes paid by the Company on behalf of the respective property. This revenue will be accrued in the same period as the expenses are incurred. In a situation in which a lease(s) associated with a significant tenant have been, or are expected to be, terminated early, the Company will evaluate the remaining useful life of depreciable or amortizable assets in the asset group related to the lease that will be terminated (i.e., tenant improvements, above- and below-market lease intangibles, in-place lease value and deferred leasing costs). Based upon consideration of the facts and circumstances surrounding the termination, the Company may write-off or accelerate the depreciation and amortization associated with the asset group. Such amounts will be included within depreciation and amortization in the consolidated statements of operations. Real Estate Debt Investments Interest income will be recognized on an accrual basis and any related premium, discount, origination costs and fees will be amortized over the life of the investment using the effective interest method. The amortization will be reflected as an adjustment to interest income in the consolidated statements of operations. The amortization of a premium or accretion of a discount will be discontinued if such loan is reclassified to held for sale. Real Estate Securities Interest income will be recognized using the effective interest method with any premium or discount amortized or accreted through earnings based on expected cash flow through the expected maturity date of the security. Changes to expected cash flow may result in a change to the yield which is then applied retrospectively for high-credit quality securities that cannot be prepaid or otherwise settled in such a way that the holder would not recover substantially all of the investment or prospectively for all other securities to recognize interest income. |
Credit Losses and Impairment on Investments | Operating Real Estate The Company’s real estate portfolio will be reviewed on a quarterly basis, or more frequently as necessary, to assess whether there are any indicators that the value of its operating real estate may be impaired or that its carrying value may not be recoverable. A property’s value will be considered impaired if the Company’s estimate of the aggregate expected future undiscounted cash flow generated by the property is less than the carrying value. In conducting this review, the Company will consider U.S. macroeconomic factors, real estate sector, asset specific conditions and other factors. To the extent an impairment has occurred, the loss will be measured as the excess of the carrying value of the property over the estimated fair value and recorded in impairment on operating real estate in the consolidated statements of operations. An allowance for a doubtful account for a tenant receivable will be established based on a periodic review of aged receivables resulting from estimated losses due to the inability of tenants to make required rent and other payments contractually due. Additionally, the Company will establish, on a current basis, an allowance for future tenant credit losses on unbilled rent receivable based on an evaluation of the collectability of such amounts. Real Estate Debt Investments Loans will be considered impaired when, based on current information and events, it is probable that the Company will not be able to collect principal and interest amounts due according to the contractual terms. The Company will assess the credit quality of the portfolio and adequacy of loan loss reserves on a quarterly basis, or more frequently as necessary. Significant judgment of the Company will be required in this analysis. The Company will consider the estimated net recoverable value of the loan as well as other factors, including but not limited to the fair value of any collateral, the amount and the status of any senior debt, the quality and financial condition of the borrower and the competitive situation of the area where the underlying collateral is located. Because this determination will be based on projections of future economic events, which are inherently subjective, the amount ultimately realized may differ materially from the carrying value as of the balance sheet date. If upon completion of the assessment, the estimated fair value of the underlying collateral is less than the net carrying value of the loan, a loan loss reserve will be recorded with a corresponding charge to provision for loan losses. The loan loss reserve for each loan will be maintained at a level that is determined to be adequate by the Company to absorb probable losses. Income recognition will be suspended for a loan at the earlier of the date at which payments become 90 -days past due or when, in the opinion of the Company, a full recovery of income and principal becomes doubtful. When the ultimate collectability of the principal of an impaired loan is in doubt, all payments will be applied to principal under the cost recovery method. When the ultimate collectability of the principal of an impaired loan is not in doubt, contractual interest will be recorded as interest income when received, under the cash basis method until an accrual is resumed when the loan becomes contractually current and performance is demonstrated to be resumed. A loan will be written off when it is no longer realizable and/or legally discharged. Investments in Unconsolidated Ventures The Company will review its investments in unconsolidated ventures for which the Company did not elect the fair value option on a quarterly basis, or more frequently as necessary, to assess whether there are any indicators that the value may be impaired or that its carrying value may not be recoverable. An investment is considered impaired if the projected net recoverable amount over the expected holding period is less than the carrying value. In conducting this review, the Company will consider U.S. and global macroeconomic factors, including real estate sector conditions, together with investment specific and other factors. To the extent an impairment has occurred and is considered to be other than temporary, the loss will be measured as the excess of the carrying value of the investment over the estimated fair value and recorded in equity in earnings (losses) of unconsolidated ventures in the consolidated statements of operations. Real Estate Securities CRE securities for which the fair value option is elected are not evaluated for other-than-temporary impairment (“OTTI”) as any change in fair value is recorded in the consolidated statements of operations. Realized losses on such securities are reclassified to realized gain (loss) on investments and other as losses occur. CRE securities for which the fair value option is not elected will be evaluated for OTTI quarterly. Impairment of a security is considered to be other-than-temporary when: (i) the holder has the intent to sell the impaired security; (ii) it is more likely than not the holder will be required to sell the security; or (iii) the holder does not expect to recover the entire amortized cost of the security. When a CRE security has been deemed to be other-than-temporarily impaired due to (i) or (ii), the security is written down to its fair value and an OTTI is recognized in the consolidated statements of operations. In the case of (iii), the security is written down to its fair value and the amount of OTTI is then bifurcated into: (a) the amount related to expected credit losses; and (b) the amount related to fair value adjustments in excess of expected credit losses. The portion of OTTI related to expected credit losses will be recognized in the consolidated statements of operations. The remaining OTTI related to the valuation adjustment will be recognized as a component of accumulated OCI in the consolidated statements of equity. The portion of OTTI recognized through earnings will be accreted back to the amortized cost basis of the security through interest income, while amounts recognized through OCI are amortized over the life of the security with no impact on earnings. CRE securities which are not high-credit quality will be considered to have an OTTI if the security has an unrealized loss and there has been an adverse change in expected cash flow. The amount of OTTI is then bifurcated as discussed above. |
Organization and Offering Costs | The Advisor Entities, or their affiliates, are entitled to receive reimbursement for organization and offering costs paid on behalf of the Company in connection with the Offering. The Company is obligated to reimburse the Advisor Entities, or their affiliates, as applicable, for organization and offering costs to the extent the aggregate of selling commissions, dealer manager fees, distribution fees and other organization and offering costs do not exceed 15.0% of gross offering proceeds from the Offering. The Advisor Entities do not expect reimbursable organization and offering costs, excluding selling commissions, dealer manager fees and distribution fees, to exceed $18.0 million , or approximately 1.0% of the total proceeds available to be raised from the Offering. The Company records organization and offering costs each period based upon an allocation determined by the expectation of total organization and offering costs to be reimbursed. Organization costs are recorded as an expense in general and administrative expenses in the consolidated statements of operations and offering costs are recorded as a reduction to equity. |
Income Taxes | The Company intends to elect to be taxed as a REIT under the Internal Revenue Code and intends to operate as such, commencing with the taxable year in which the Company satisfies the minimum offering requirement. The Company expects to have little or no taxable income prior to electing REIT status. To qualify as a REIT, the Company must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of the Company’s annual REIT taxable income to its stockholders (which is computed without regard to the dividends-paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with U.S. GAAP). As a REIT, the Company generally will not be subject to federal income tax to the extent it distributes qualifying dividends to its stockholders. If the Company fails to qualify as a REIT in any taxable year, it will be subject to federal income tax on its taxable income at regular corporate income tax rates and generally will not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost unless the Internal Revenue Service grants the Company relief under certain statutory provisions. Such an event could materially adversely affect the Company’s net income and net cash available for distribution to stockholders. However, the Company intends to organize and operate in such a manner as to qualify for treatment as a REIT. |
Recent Accounting Pronouncements | In May 2014, the Financial Accounting Standards Board (“FASB”) issued an accounting update requiring a company to recognize as revenue the amount of consideration it expects to be entitled to in connection with the transfer of promised goods or services to customers. The accounting standard update will replace most of the existing revenue recognition guidance currently promulgated by U.S. GAAP. In July 2015, the FASB decided to delay the effective date of the new revenue standard by one year. The effective date of the new revenue standard for the Company will be January 1, 2018. The Company is in the process of evaluating the impact, if any, of the update on its consolidated financial position, results of operations and financial statement disclosures. In February 2015, the FASB issued updated guidance that changes the rules regarding consolidation. The pronouncement eliminates specialized guidance for limited partnerships and similar legal entities and removes the indefinite deferral for certain investment funds. The new guidance is effective for annual periods and interim periods within those annual periods beginning after December 15, 2015, with early adoption permitted. The Company adopted this guidance in the first quarter 2016 and determined the Company’s Operating Partnership is considered a VIE. The Company is the primary beneficiary of the VIE, the VIE’s assets can be used for purposes other than the settlement of the VIE’s obligations and the Company’s partnership interest is considered a majority voting interest. As such, this standard did not have a material impact on the Company’s consolidated financial position or results of operations. In January 2016, the FASB issued an accounting update that addresses certain aspects of recognition, measurement, presentation and disclosure of financial instruments. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2017. The Company is currently assessing the impact, if any, of the guidance on the Company’s consolidated financial position, results of operations and financial statement disclosures. In February 2016, the FASB issued an accounting update that requires lessees to present right-of-use assets and lease liabilities on the balance sheet. The new guidance is to be applied using a modified retrospective approach at the beginning of the earliest comparative period in the financial statements and is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years. Early adoption is permitted. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. In March 2016, the FASB issued guidance which eliminates the requirement for an investor to retroactively apply the equity method when its increase in ownership interest (or degree of influence) in an investee triggers equity method accounting. The update requires that the equity method investor add the cost of acquiring the additional interest in the investee to the current basis of the investor’s previously held interest and adopt the equity method of accounting as of the date the investment become qualified for equity method accounting. The update should be applied prospectively upon their effective date to increases in the level of ownership interests or degree of influence that results in the adoption of the equity method. The guidance is effective for fiscal years beginning after December 15, 2016 and interim periods within those fiscal years. Early adoption is permitted. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. In March 2016, the FASB issued guidance which amends several aspects of the accounting for equity-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The guidance is effective for interim and annual reporting periods in fiscal years beginning after December 15, 2017. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. In June 2016, the FASB issued guidance which changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. Additionally, entities will have to disclose significantly more information including information used to track credit quality by year of origination for most financing receivables. The new guidance is effective for fiscal years, and interim periods within those years, beginning after December 15, 2019. Early adoption is permitted. The Company is evaluating the impact, if any, that this guidance will have on its consolidated financial position, results of operations and financial statement disclosures. |
Equity-Based Compensation | The Company adopted a long-term incentive plan (the “Plan”), which it may use to attract and retain qualified officers, directors, employees and consultants, as well as an independent directors compensation plan, which is a component of the Plan. All stock issued under the Plan will consist of Class A common stock unless the board of directors of the Company determines otherwise. The Company currently intends to issue awards only to its independent directors under the Plan. The Company will account for its equity-based compensation awards using the fair value method, which requires an estimate of fair value of the award at the time of grant. All fixed equity-based awards to directors, which have no vesting conditions other than time of service, will be amortized to compensation expense over the vesting period on a straight-line basis. Equity-based compensation will be recorded in general and administrative expenses in the consolidated statements of operations. |
Fair Value | The fair value of financial instruments is categorized based on the priority of the inputs to the valuation technique and categorized into a three-level fair value hierarchy. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level 1) and the lowest priority to unobservable inputs (Level 3). If the inputs used to measure the financial instruments fall within different levels of the hierarchy, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. Financial assets and liabilities recorded at fair value on the consolidated balance sheets are categorized based on the inputs to the valuation techniques as follows: Level 1. Quoted prices for identical assets or liabilities in an active market. Level 2. Financial assets and liabilities whose values are based on the following: a) Quoted prices for similar assets or liabilities in active markets. b) Quoted prices for identical or similar assets or liabilities in non-active markets. c) Pricing models whose inputs are observable for substantially the full term of the asset or liability. d) Pricing models whose inputs are derived principally from or corroborated by observable market data for substantially the full term of the asset or liability. Level 3. Prices or valuation techniques based on inputs that are both unobservable and significant to the overall fair value measurement. |
Related Party Arrangements (Tab
Related Party Arrangements (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Related Party Transactions [Abstract] | |
Summary of Fees and Reimbursements to the Advisor Entities and Dealer Manager | The following table presents the fees and reimbursements incurred to the Advisor Entities and the Dealer Manager for the three and six months ended June 30, 2016 and the amount due to related party as of June 30, 2016 and December 31, 2015 : Three and Six Months Ended Due to Related Party as of Type of Fee or Reimbursement Financial Statement Location June 30, 2016 June 30, 2016 (Unaudited) December 31, 2015 Fees to Advisor Entities Asset management Asset management and other fees - related party $ 7,070 $ — $ — Acquisition (1) Asset management and other fees- related party 110,098 82,573 — Reimbursements to Advisor Entities Operating costs (2) General and administrative expenses 9,241 — — Organization (3) General and administrative expenses 238 238 1,000 Offering (3) Cost of capital (4) 4,521 4,521 19,000 Selling commissions / Dealer manager fees / Distribution fees Cost of capital (4) 38,394 8,399 — Total $ 169,562 $ 95,731 $ 20,000 _________________________________________________ (1) Acquisition fees related to investments in unconsolidated joint ventures are generally included in investments in unconsolidated ventures on the consolidated balance sheets when the fair value option is not elected for the investment, but is expensed as incurred when the fair value option is elected. The Advisor Entities may determine to defer fees or seek reimbursement. (2) As of June 30, 2016 , the Advisor Entities have incurred unreimbursed operating costs on behalf of the Company of $8.5 million , that remain eligible to allocate to the Company. (3) As of June 30, 2016 , the Advisor Entities have incurred unreimbursed organization and offering costs on behalf of the Company of $4.1 million , that remain eligible to allocate to the Company. (4) Cost of capital is included in net proceeds from issuance of common stock in the Company’s consolidated statements of equity. |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 6 Months Ended |
Jun. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Distributions Declared | The following table presents distributions declared for the six months ended June 30, 2016 : Distributions (1) Period Cash DRP Total January $ — $ — $ — February — — — March — — — April — — — May 1,036 6 1,042 June 2,139 14 2,153 Total $ 3,175 $ 20 $ 3,195 _________________________________________________ (1) Represents distributions declared for the period, even though such distributions are actually paid to stockholders the month following such period. |
Business and Organization (Deta
Business and Organization (Details) - USD ($) | Dec. 23, 2015 | Mar. 28, 2014 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2016 | Feb. 09, 2015 |
Class of Stock [Line Items] | ||||||
Common stock, shares authorized (shares) | 400,000,000 | 400,000,000 | ||||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | ||||
Preferred stock, shares authorized (shares) | 50,000,000 | 50,000,000 | 50,000,000 | |||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |||
Net proceeds from issuance of common stock | $ 200,000 | $ 424,761 | $ 1,981,000 | |||
Minimum | ||||||
Class of Stock [Line Items] | ||||||
Common stock declared effective to offer | $ 2,000,000 | |||||
Maximum | ||||||
Class of Stock [Line Items] | ||||||
Common stock declared effective to offer | 2,000,000,000 | |||||
Sponsor of the Registrant | ||||||
Class of Stock [Line Items] | ||||||
Number of shares of common stock issued (shares) | 16,667 | |||||
Net proceeds from issuance of common stock | $ 1,500,000 | |||||
Co-Sponsor of the Registrant | ||||||
Class of Stock [Line Items] | ||||||
Number of shares of common stock issued (shares) | 5,556 | |||||
Net proceeds from issuance of common stock | $ 500,000 | |||||
Class A common | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized (shares) | 120,000,000 | 120,000,000 | 120,000,000 | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |||
Number of shares of common stock issued (shares) | 30,787 | 219,780 | 250,567 | |||
Net proceeds from issuance of common stock | $ 300,000 | $ 2,000,000 | $ 2,300,000 | |||
Class A common | Distribution Reinvestment Plan | ||||||
Class of Stock [Line Items] | ||||||
Common stock declared effective to offer | $ 200,000,000 | |||||
Purchase price (in dollars per share) | $ 9.81 | $ 9.81 | $ 9.81 | |||
Class A common | IPO | ||||||
Class of Stock [Line Items] | ||||||
Common stock declared effective to offer | $ 1,800,000,000 | |||||
Purchase price (in dollars per share) | $ 10.1111 | |||||
Class T common | ||||||
Class of Stock [Line Items] | ||||||
Common stock, shares authorized (shares) | 280,000,000 | 280,000,000 | 280,000,000 | |||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | $ 0.01 | |||
Number of shares of common stock issued (shares) | 17,317 | 17,317 | ||||
Net proceeds from issuance of common stock | $ 200,000 | $ 200,000 | ||||
Class T common | Distribution Reinvestment Plan | ||||||
Class of Stock [Line Items] | ||||||
Purchase price (in dollars per share) | $ 9.27 | $ 9.27 | 9.27 | |||
Class T common | IPO | ||||||
Class of Stock [Line Items] | ||||||
Purchase price (in dollars per share) | $ 9.5538 | |||||
NorthStar/RXR NTR OP Holdings LLC | ||||||
Class of Stock [Line Items] | ||||||
Noncontrolling interests | $ 1,000 |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Details) | 6 Months Ended |
Jun. 30, 2016USD ($) | |
Related Party Transaction [Line Items] | |
Acquisition fees and expenses, percentage of contract purchase | 6.00% |
Number of days past due for suspension of income recognition | 90 days |
Organization and Offering Costs | Sub-Advisor | Maximum | |
Related Party Transaction [Line Items] | |
Percentage of gross offering proceeds from primary offering, reimbursable as organization and offering costs | 15.00% |
Organization and Offering Costs | Advisor | |
Related Party Transaction [Line Items] | |
Reimbursable organization and offering costs, excluding selling commissions, dealer manager fees, and distribution fees (not to exceed) | $ 18,000,000 |
Expected reimbursable organization and offering costs, excluding selling commissions and dealer manager fee, as a percentage of total proceeds available to be raised from the primary offering | 1.00% |
Investment in Unconsolidated 21
Investment in Unconsolidated Venture (Details) ft² in Millions | May 20, 2016USD ($)ft² | Jun. 30, 2016USD ($) | Jun. 30, 2016USD ($) |
Business Acquisition [Line Items] | |||
Purchase price | $ 1,900,000 | ||
Unrealized loss | $ 3,621 | 3,621 | |
RXR Realty | |||
Business Acquisition [Line Items] | |||
Purchase price | $ 1,650,000,000 | ||
Class-A Office Building | RXR Realty | Acquisition Financing | |||
Business Acquisition [Line Items] | |||
Amount financed | 1,100,000,000 | ||
Additional future funding capacity | $ 100,000,000 | ||
Financing term | 7 years | ||
Class-A Office Building | RXR Realty | Acquisition Financing | Weighted Average | |||
Business Acquisition [Line Items] | |||
Fixed interest rate per annum | 4.30% | ||
1285 Avenue of the Americas Venture | Class-A Office Building | Co-Sponsor | |||
Business Acquisition [Line Items] | |||
Square feet of office building acquired | ft² | 1.8 | ||
Purchase price | $ 1,900,000 | ||
Carrying value | 1,900,000 | 1,900,000 | |
Unrealized loss | 4,000 | 4,000 | |
Cash distributions | $ 0 | $ 0 |
Related Party Arrangements (Nar
Related Party Arrangements (Narrative) (Details) | 1 Months Ended | 6 Months Ended | |
Jun. 30, 2016USD ($) | Jun. 30, 2016USD ($)quarter | Dec. 31, 2015USD ($) | |
Dealer Manager | |||
Due to related party | $ 95,731 | $ 95,731 | $ 20,000 |
Sub-Advisor | |||
Advisor Entities | |||
Sub-advisors percentage rights to fees | 50.00% | ||
Sub-advisors percentage rights to reimbursements | 25.00% | ||
Advisory agreement renewal term | 1 year | ||
Sub-Advisor | Organization and Offering Costs | Maximum | |||
Organization and Offering Costs | |||
Percentage of gross offering proceeds from primary offering, reimbursable as organization and offering costs | 15.00% | ||
Advisor | Asset Management Fee | |||
Asset Management Fee | |||
Monthly asset management fee factor | 8.33% | ||
Monthly asset management fee rate | 0.10% | ||
Annual asset management fee rate | 1.25% | ||
Advisor | Incentive Fees | |||
Incentive Fee | |||
Distributions, percent of net cash flow | 15.00% | ||
Cumulative, non-compounded annual pre-tax return on invested capital | 6.00% | ||
Advisor | Acquisition Fee | |||
Acquisition Fee | |||
Asset acquisition fee as a percentage of each real estate property acquired by the company, including acquisition expenses and any financing attributable to the investment (percent) | 2.25% | ||
Asset acquisition fee as a percentage of principal amount funded to originate debt, including acquisition expenses and any financing attributable to the investment (percent) | 1.00% | ||
Advisor | Disposition Fee | |||
Disposition Fee | |||
Disposition fee of contract sales price of each property | 2.00% | ||
Maximum disposition fee as a percentage of contract sales price of CRE investment sold | 1.00% | ||
Disposition fee as a percentage of the principal amount of the loan or CRE debt investment prior to the specified transaction | 1.00% | ||
Advisor | Operating Costs | |||
Operating Costs | |||
Reimbursement of personnel costs related to officers and personnel involved in activities for which other fees is received | $ 0 | ||
Number of fiscal quarters | quarter | 4 | ||
Reimbursement expense period | 12 months | ||
Advisor | Operating Costs | Maximum | |||
Operating Costs | |||
Percentage of average invested assets reimbursable as operating costs | 2.00% | ||
Percentage of net income, without reduction for any additions to reserves for depreciation, loan losses or other similar non-cash reserves and excluding any gain from the sale of the company's assets, considered for reimbursement of operating costs | 25.00% | ||
Advisor | Organization and Offering Costs | |||
Organization and Offering Costs | |||
Reimbursable organization and offering costs, excluding selling commissions, dealer manager fees, and distribution fees (not to exceed) | $ 18,000,000 | ||
Expected reimbursable organization and offering costs, excluding selling commissions and dealer manager fee, as a percentage of total proceeds available to be raised from the primary offering | 1.00% | ||
Dealer Manager | Class A and T | |||
Dealer Manager | |||
Percent of gross proceeds of the Primary Offering | 10.00% | ||
Dealer Manager | Class A | |||
Dealer Manager | |||
Selling commissions, percent of gross proceeds | 7.00% | ||
Dealer manager, percent of gross proceeds | 3.00% | ||
Dealer Manager | Class T | |||
Dealer Manager | |||
Selling commissions, percent of gross proceeds | 2.00% | ||
Dealer manager, percent of gross proceeds | 2.75% | ||
Distribution fee, percent of gross proceeds | 1.00% | ||
Percent of stockholder's gross investment | 10.00% | ||
Dealer Manager | Selling Commissions and Fees Related to DRP | |||
Dealer Manager | |||
Selling commissions or dealer manager fees paid | $ 0 | ||
Dealer Manager | Distribution Fees | |||
Dealer Manager | |||
Distribution fees as a reduction to stockholders' equity | 8,465 | ||
Cost of capital | Dealer Manager | Selling Commissions Or Dealer Manager Fees | |||
Dealer Manager | |||
Due to related party | $ 8,268 | $ 8,268 |
Related Party Arrangements - Su
Related Party Arrangements - Summary of Fees and Reimbursements (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |
Jun. 30, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | |
Related Party Transaction [Line Items] | |||
Fees and reimbursements | $ 169,562 | $ 169,562 | |
Due to related party | 95,731 | 95,731 | $ 20,000 |
Fees and Reimbursements to Advisor Entities | Unreimbursed operating costs | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 8,500,000 | ||
Fees and Reimbursements to Advisor Entities | Unreimbursed organization and offering costs | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 4,100,000 | ||
Asset management and other fees - related party | Fees and Reimbursements to Advisor Entities | Asset management | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 7,070 | 7,070 | |
Due to related party | 0 | 0 | 0 |
Asset management and other fees - related party | Fees and Reimbursements to Advisor Entities | Acquisition | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 110,098 | 110,098 | |
Due to related party | 82,573 | 82,573 | 0 |
General and administrative expenses | Fees and Reimbursements to Advisor Entities | Operating costs | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 9,241 | 9,241 | |
Due to related party | 0 | 0 | 0 |
General and administrative expenses | Fees and Reimbursements to Advisor Entities | Organization | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 238 | 238 | |
Due to related party | 238 | 238 | 1,000 |
Cost of capital | Fees and Reimbursements to Advisor Entities | Offering | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 4,521 | 4,521 | |
Due to related party | 4,521 | 4,521 | 19,000 |
Cost of capital | Selling commissions / Dealer manager fees / Distribution fees | Selling commissions / Dealer manager fees / Distribution fees | |||
Related Party Transaction [Line Items] | |||
Fees and reimbursements | 38,394 | 38,394 | |
Due to related party | $ 8,399 | $ 8,399 | $ 0 |
Related Party Arrangements - Di
Related Party Arrangements - Distribution Support Agreement (Narrative) (Details) - USD ($) | Dec. 23, 2015 | Mar. 28, 2014 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2016 |
Related Party Transaction [Line Items] | |||||
Common stock purchased | $ 200,000 | $ 424,761 | $ 1,981,000 | ||
Class A common | |||||
Related Party Transaction [Line Items] | |||||
Common stock purchased (shares) | 30,787 | 219,780 | 250,567 | ||
Common stock purchased | $ 300,000 | $ 2,000,000 | $ 2,300,000 | ||
NorthStar Realty | Distribution Support Agreement | Class A common | |||||
Related Party Transaction [Line Items] | |||||
Commitment to purchase common stock (percent) | 75.00% | ||||
Commitment to purchase common stock | $ 10,000,000 | 10,000,000 | |||
Common stock purchased (shares) | 164,835 | 0 | |||
Common stock purchased | $ 1,500,000 | ||||
RXR Realty | Distribution Support Agreement | Class A common | |||||
Related Party Transaction [Line Items] | |||||
Commitment to purchase common stock (percent) | 25.00% | ||||
Commitment to purchase common stock | $ 10,000,000 | $ 10,000,000 | |||
Common stock purchased (shares) | 54,945 | 0 | |||
Common stock purchased | $ 500,000 |
Related Party Arrangements - No
Related Party Arrangements - NorthStar Realty and RXR (Narrative) (Details) | Dec. 31, 2013 |
NorthStar Realty | RXR Realty | |
Related Party Transaction [Line Items] | |
Equity interest percentage | 27.00% |
Related Party Arrangements - In
Related Party Arrangements - Investment in Unconsolidated Ventures (Narrative) (Details) ft² in Millions | May 20, 2016USD ($)ft² | Jun. 30, 2016USD ($) |
Related Party Transaction [Line Items] | ||
Purchase price | $ 1,900,000 | |
RXR Realty | ||
Related Party Transaction [Line Items] | ||
Purchase price | $ 1,650,000,000 | |
Class-A Office Building | RXR Realty | Acquisition Financing | ||
Related Party Transaction [Line Items] | ||
Amount financed | 1,100,000,000 | |
Additional future funding capacity | $ 100,000,000 | |
Financing term | 7 years | |
Class-A Office Building | RXR Realty | Acquisition Financing | Weighted Average | ||
Related Party Transaction [Line Items] | ||
Fixed interest rate per annum | 4.30% | |
1285 AoA Interest | Class-A Office Building | Co-Sponsor | ||
Related Party Transaction [Line Items] | ||
Square feet of office building acquired | ft² | 1.8 | |
Purchase price | $ 1,900,000 |
Equity-Based Compensation (Deta
Equity-Based Compensation (Details) - Restricted stock | 3 Months Ended | 6 Months Ended |
Jun. 30, 2016USD ($)directorshares | Jun. 30, 2016USD ($)directorshares | |
Equity-based compensation | ||
Number of independent directors | director | 3 | 3 |
Quarterly vesting period | 2 years | |
Equity-based compensation expense | $ | $ 9,479 | $ 9,479 |
Shares granted (shares) | shares | 22,500 | 22,500 |
Class A common | ||
Equity-based compensation | ||
Cumulative shares granted (shares) | shares | 22,500 | 22,500 |
Aggregate value of stock granted | $ | $ 200,000 | $ 200,000 |
Stockholders' Equity - Common S
Stockholders' Equity - Common Stock from Primary Offering (Narrative) (Details) - USD ($) | Mar. 28, 2014 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2016 |
Class of Stock [Line Items] | ||||
Gross proceeds from issuance of common stock | $ 200,000 | $ 424,761 | $ 1,981,000 | |
Class A | ||||
Class of Stock [Line Items] | ||||
Number of shares of common stock issued (shares) | 30,787 | 219,780 | 250,567 | |
Gross proceeds from issuance of common stock | $ 300,000 | $ 2,000,000 | $ 2,300,000 | |
Class T | ||||
Class of Stock [Line Items] | ||||
Number of shares of common stock issued (shares) | 17,317 | 17,317 | ||
Gross proceeds from issuance of common stock | $ 200,000 | $ 200,000 |
Stockholders' Equity - Distribu
Stockholders' Equity - Distribution Reinvestment Plan (Narrative) (Details) - USD ($) | 6 Months Ended | |
Jun. 30, 2016 | Feb. 09, 2015 | |
Stockholders Equity Note [Line Items] | ||
Gross proceeds raised pursuant to DRP | $ 6 | |
DRP | ||
Stockholders Equity Note [Line Items] | ||
Period within which the company expects to establish an estimated value per share | 150 days | |
Notice period served by board of directors to amend or terminate distribution reinvestment plan | 10 days | |
Distribution Reinvestment Plan | ||
Stockholders Equity Note [Line Items] | ||
Gross proceeds raised pursuant to DRP | $ 6 | |
Class A common | Distribution Reinvestment Plan | ||
Stockholders Equity Note [Line Items] | ||
Purchase price (in dollars per share) | $ 9.81 | $ 9.81 |
Percent of estimated value per share | 97.00% | |
Class T common | Distribution Reinvestment Plan | ||
Stockholders Equity Note [Line Items] | ||
Purchase price (in dollars per share) | $ 9.27 | $ 9.27 |
Stockholders' Equity - Distri30
Stockholders' Equity - Distributions (Narrative) (Details) | 6 Months Ended |
Jun. 30, 2016$ / shares | |
Class of Stock [Line Items] | |
Annualized distribution amount (in dollars per share) | $ 0.10 |
Class A common | |
Class of Stock [Line Items] | |
Daily cash distribution (in dollars per share) | 0.000273224 |
Class T common | |
Class of Stock [Line Items] | |
Daily cash distribution (in dollars per share) | $ 0.000273224 |
Stockholders' Equity - Dividend
Stockholders' Equity - Dividends Declared (Details) - USD ($) | 1 Months Ended | 6 Months Ended | |||||
Jun. 30, 2016 | May 31, 2016 | Apr. 30, 2016 | Mar. 31, 2016 | Feb. 29, 2016 | Jan. 31, 2016 | Jun. 30, 2016 | |
Equity [Abstract] | |||||||
Cash | $ 2,139 | $ 1,036 | $ 0 | $ 0 | $ 0 | $ 0 | $ 3,175 |
DRP | 14 | 6 | 0 | 0 | 0 | 0 | 20 |
Total | $ 2,153 | $ 1,042 | $ 0 | $ 0 | $ 0 | $ 0 | $ 3,195 |
Stockholders' Equity - Share Re
Stockholders' Equity - Share Repurchase Program (Narrative) (Details) | 6 Months Ended |
Jun. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Threshold period to repurchase shares | 1 year |
Stockholders' Equity - Stock Di
Stockholders' Equity - Stock Distribution (Narrative) (Details) | 1 Months Ended |
Apr. 30, 2016USD ($) | |
Class of Stock [Line Items] | |
Offering threshold for special stock dividends | $ 100,000,000 |
Period following record date for special stock dividend | 90 days |
Class A | |
Class of Stock [Line Items] | |
Percent of current gross offering price for special stock dividend | 5.00% |
Class T | |
Class of Stock [Line Items] | |
Percent of current gross offering price for special stock dividend | 5.00% |
Fair Value (Details)
Fair Value (Details) $ in Millions | Jun. 30, 2016USD ($) |
Fair Value Disclosures [Abstract] | |
Fair value of investment in unconsolidated venture | $ 1.9 |
Subsequent Events - Common Stoc
Subsequent Events - Common Stock from Primary Offering (Details) - USD ($) | Mar. 28, 2014 | Aug. 10, 2016 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2016 |
Subsequent Event [Line Items] | |||||
Gross proceeds from issuance of common stock | $ 200,000 | $ 424,761 | $ 1,981,000 | ||
Class A | |||||
Subsequent Event [Line Items] | |||||
Number of shares of common stock issued (shares) | 30,787 | 219,780 | 250,567 | ||
Gross proceeds from issuance of common stock | $ 300,000 | $ 2,000,000 | $ 2,300,000 | ||
Class T | |||||
Subsequent Event [Line Items] | |||||
Number of shares of common stock issued (shares) | 17,317 | 17,317 | |||
Gross proceeds from issuance of common stock | $ 200,000 | $ 200,000 | |||
Subsequent Event | Class A | Primary Offering | |||||
Subsequent Event [Line Items] | |||||
Number of shares of common stock issued (shares) | 58,264 | ||||
Gross proceeds from issuance of common stock | $ 600,000 | ||||
Subsequent Event | Class T | Primary Offering | |||||
Subsequent Event [Line Items] | |||||
Number of shares of common stock issued (shares) | 7,746 | ||||
Gross proceeds from issuance of common stock | $ 100,000 |
Subsequent Events - Distributio
Subsequent Events - Distributions (Details) | Aug. 11, 2016$ / shares |
Subsequent Event | |
Subsequent Event [Line Items] | |
Daily cash distribution of common stock (in dollars per share) | $ 0.000273224 |
Subsequent Events - NorthStar R
Subsequent Events - NorthStar Realty and RXR Purchase of Common Stock (Details) - USD ($) | Aug. 11, 2016 | Mar. 28, 2014 | Jun. 30, 2016 | Dec. 31, 2015 | Jun. 30, 2016 |
Subsequent Event [Line Items] | |||||
Gross proceeds from issuance of common stock | $ 200,000 | $ 424,761 | $ 1,981,000 | ||
Class A | |||||
Subsequent Event [Line Items] | |||||
Number of shares of common stock issued (shares) | 30,787 | 219,780 | 250,567 | ||
Gross proceeds from issuance of common stock | $ 300,000 | $ 2,000,000 | $ 2,300,000 | ||
Subsequent Event | Class A | Distribution Support Agreement | NorthStar Realty | |||||
Subsequent Event [Line Items] | |||||
Number of shares of common stock issued (shares) | 86 | ||||
Gross proceeds from issuance of common stock | $ 777 | ||||
Subsequent Event | Class A | Distribution Support Agreement | RXR Realty | |||||
Subsequent Event [Line Items] | |||||
Number of shares of common stock issued (shares) | 28 | ||||
Gross proceeds from issuance of common stock | $ 259 |