Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2023 | Aug. 03, 2023 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Jun. 30, 2023 | |
Document Transition Report | false | |
Entity File Number | 001-38010 | |
Entity Registrant Name | CLIPPER REALTY INC. | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 47-4579660 | |
Entity Address, Address Line One | 4611 12th Avenue, Suite 1L | |
Entity Address, City or Town | Brooklyn | |
Entity Address, State or Province | NY | |
Entity Address, Postal Zip Code | 11219 | |
City Area Code | 718 | |
Local Phone Number | 438-2804 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | CLPR | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding (in shares) | 16,063,228 | |
Entity Central Index Key | 0001649096 | |
Current Fiscal Year End Date | --12-31 | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Consolidated Balance Sheets (Cu
Consolidated Balance Sheets (Current Period Unaudited) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
ASSETS | ||
Land and improvements | $ 571,988 | $ 540,859 |
Building and improvements | 718,661 | 656,460 |
Tenant improvements | 3,406 | 3,406 |
Furniture, fixtures and equipment | 13,062 | 12,878 |
Real estate under development | 66,361 | 142,287 |
Total investment in real estate | 1,373,478 | 1,355,890 |
Accumulated depreciation | (198,825) | (184,781) |
Investment in real estate, net | 1,174,653 | 1,171,109 |
Cash and cash equivalents | 16,342 | 18,152 |
Restricted cash | 14,731 | 12,514 |
Tenant and other receivables, net of allowance for doubtful accounts of $175 and $321, respectively | 5,169 | 5,005 |
Deferred rent | 2,546 | 2,573 |
Deferred costs and intangible assets, net | 6,418 | 6,624 |
Prepaid expenses and other assets | 5,960 | 13,654 |
TOTAL ASSETS | 1,225,819 | 1,229,631 |
Liabilities: | ||
Notes payable, net of unamortized loan costs of $9,803 and $9,650, respectively | 1,176,956 | 1,161,588 |
Accounts payable and accrued liabilities | 15,319 | 17,094 |
Security deposits | 8,660 | 7,940 |
Below-market leases, net | 1 | 18 |
Other liabilities | 5,353 | 5,812 |
TOTAL LIABILITIES | 1,206,289 | 1,192,452 |
Equity: | ||
Preferred stock, $0.01 par value; 100,000 shares authorized (including 140 shares of 12.5% Series A cumulative non-voting preferred stock), zero shares issued and outstanding | 0 | 0 |
Common stock, $0.01 par value; 500,000,000 shares authorized, 16,063,228 and 16,063,228 shares issued and outstanding, respectively | 160 | 160 |
Additional paid-in-capital | 89,127 | 88,829 |
Accumulated deficit | (81,883) | (74,895) |
Total stockholders’ equity | 7,404 | 14,094 |
Non-controlling interests | 12,126 | 23,085 |
TOTAL EQUITY | 19,530 | 37,179 |
TOTAL LIABILITIES AND EQUITY | $ 1,225,819 | $ 1,229,631 |
Consolidated Balance Sheets (_2
Consolidated Balance Sheets (Current Period Unaudited) (Parentheticals) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2023 | Dec. 31, 2022 | |
Allowance for doubtful accounts | $ 175 | $ 321 |
Unamortized loan costs | $ 9,803 | $ 9,650 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000 | 100,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common Stock, Shares, Issued (in shares) | 16,063,228 | 16,063,228 |
Common stock, shares outstanding (in shares) | 16,063,228 | 16,063,228 |
Series A Cumulative Non-Voting Preferred Stock [Member] | ||
Preferred stock, shares authorized (in shares) | 140 | 140 |
Preferred stock, dividend rate, percentage | 12.50% | 12.50% |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
REVENUES | ||||
Total Revenues | $ 34,543 | $ 31,887 | $ 68,210 | $ 63,937 |
OPERATING EXPENSES | ||||
Property operating expenses | 6,782 | 6,928 | 14,881 | 14,467 |
Real estate taxes and insurance | 8,700 | 7,886 | 17,236 | 15,817 |
General and administrative | 3,396 | 3,197 | 6,689 | 6,139 |
Transaction pursuit costs | 357 | 92 | 357 | 516 |
Depreciation and amortization | 7,269 | 6,732 | 14,094 | 13,437 |
TOTAL OPERATING EXPENSES | 26,504 | 24,835 | 53,257 | 50,376 |
INCOME FROM OPERATIONS | 8,039 | 7,052 | 14,953 | 13,561 |
Interest expense, net | (11,334) | (10,005) | (21,469) | (19,990) |
Loss on extinguishment of debt | 0 | 0 | (3,868) | 0 |
Net loss | (3,295) | (2,953) | (10,384) | (6,429) |
Net loss attributable to non-controlling interests | 2,046 | 1,834 | 6,448 | 3,992 |
Net loss attributable to common stockholders | $ (1,249) | $ (1,119) | $ (3,936) | $ (2,437) |
Basic and diluted net loss per share (in dollars per share) | $ (0.10) | $ (0.08) | $ (0.29) | $ (0.18) |
Residential Rental [Member] | ||||
REVENUES | ||||
Total Revenues | $ 25,040 | $ 22,597 | $ 48,980 | $ 44,059 |
Commercial Real Estate [Member] | ||||
REVENUES | ||||
Total Revenues | $ 9,503 | $ 9,290 | $ 19,230 | $ 19,878 |
Consolidated Statements of Chan
Consolidated Statements of Changes in Equity (Unaudited) - USD ($) $ in Thousands | Common Stock [Member] Cumulative Effect, Period of Adoption, Adjustment [Member] | Common Stock [Member] | Additional Paid-in Capital [Member] Cumulative Effect, Period of Adoption, Adjustment [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] Cumulative Effect, Period of Adoption, Adjustment [Member] | Retained Earnings [Member] | Parent [Member] Cumulative Effect, Period of Adoption, Adjustment [Member] | Parent [Member] | Noncontrolling Interest [Member] Cumulative Effect, Period of Adoption, Adjustment [Member] | Noncontrolling Interest [Member] | Cumulative Effect, Period of Adoption, Adjustment [Member] | Total |
Balance (in shares) at Dec. 31, 2021 | 0 | 16,063,228 | ||||||||||
Balance at Dec. 31, 2021 | $ 0 | $ 160 | $ 0 | $ 88,089 | $ (2,291) | $ (61,736) | $ (2,291) | $ 26,513 | $ (3,755) | $ 43,436 | $ (6,046) | $ 69,949 |
Amortization of LTIP grants | 0 | 0 | 0 | 0 | 495 | 495 | ||||||
Dividends and distributions | 0 | 0 | (1,526) | (1,526) | (4,188) | |||||||
Dividends and distributions | (2,662) | |||||||||||
Net loss | 0 | 0 | (1,318) | (1,318) | (2,158) | (3,476) | ||||||
Reallocation of noncontrolling interests | $ 0 | 126 | 0 | 126 | (126) | 0 | ||||||
Balance (in shares) at Mar. 31, 2022 | 16,063,228 | |||||||||||
Balance at Mar. 31, 2022 | $ 160 | 88,215 | (66,871) | 21,504 | 35,230 | 56,734 | ||||||
Balance (in shares) at Dec. 31, 2021 | 0 | 16,063,228 | ||||||||||
Balance at Dec. 31, 2021 | $ 0 | $ 160 | $ 0 | 88,089 | $ (2,291) | (61,736) | $ (2,291) | 26,513 | $ (3,755) | 43,436 | $ (6,046) | 69,949 |
Net loss | (6,429) | |||||||||||
Balance (in shares) at Jun. 30, 2022 | 16,063,228 | |||||||||||
Balance at Jun. 30, 2022 | $ 160 | 88,392 | (69,516) | 19,036 | 31,186 | 50,222 | ||||||
Balance (in shares) at Mar. 31, 2022 | 16,063,228 | |||||||||||
Balance at Mar. 31, 2022 | $ 160 | 88,215 | (66,871) | 21,504 | 35,230 | 56,734 | ||||||
Amortization of LTIP grants | 0 | 0 | 0 | 0 | 714 | 714 | ||||||
Dividends and distributions | 0 | 0 | (1,526) | (1,526) | (4,273) | |||||||
Dividends and distributions | (2,747) | |||||||||||
Net loss | 0 | 0 | (1,119) | (1,119) | (1,834) | (2,953) | ||||||
Reallocation of noncontrolling interests | $ 0 | 177 | 0 | 177 | (177) | 0 | ||||||
Balance (in shares) at Jun. 30, 2022 | 16,063,228 | |||||||||||
Balance at Jun. 30, 2022 | $ 160 | 88,392 | (69,516) | 19,036 | 31,186 | 50,222 | ||||||
Balance (in shares) at Dec. 31, 2022 | 16,063,228 | |||||||||||
Balance at Dec. 31, 2022 | $ 160 | 88,829 | (74,895) | 14,094 | 23,085 | 37,179 | ||||||
Amortization of LTIP grants | 648 | 648 | ||||||||||
Dividends and distributions | 0 | 0 | (1,526) | (1,526) | (4,348) | |||||||
Dividends and distributions | (2,822) | |||||||||||
Net loss | 0 | 0 | (2,687) | (2,687) | (4,402) | (7,089) | ||||||
Reallocation of noncontrolling interests | $ 0 | 123 | 0 | 123 | (123) | 0 | ||||||
Balance (in shares) at Mar. 31, 2023 | 16,063,228 | |||||||||||
Balance at Mar. 31, 2023 | $ 160 | 88,952 | (79,108) | 10,004 | 16,386 | 26,390 | ||||||
Balance (in shares) at Dec. 31, 2022 | 16,063,228 | |||||||||||
Balance at Dec. 31, 2022 | $ 160 | 88,829 | (74,895) | 14,094 | 23,085 | 37,179 | ||||||
Net loss | (10,384) | |||||||||||
Balance (in shares) at Jun. 30, 2023 | 16,063,228 | |||||||||||
Balance at Jun. 30, 2023 | $ 160 | 89,127 | (81,883) | 7,404 | 12,126 | 19,530 | ||||||
Balance (in shares) at Mar. 31, 2023 | 16,063,228 | |||||||||||
Balance at Mar. 31, 2023 | $ 160 | 88,952 | (79,108) | 10,004 | 16,386 | 26,390 | ||||||
Amortization of LTIP grants | 0 | 0 | 0 | 0 | 783 | 783 | ||||||
Dividends and distributions | 0 | 0 | (1,526) | (1,526) | (4,348) | |||||||
Dividends and distributions | (2,822) | |||||||||||
Net loss | 0 | 0 | (1,249) | (1,249) | (2,046) | (3,295) | ||||||
Reallocation of noncontrolling interests | $ 0 | 175 | 0 | 175 | (175) | 0 | ||||||
Balance (in shares) at Jun. 30, 2023 | 16,063,228 | |||||||||||
Balance at Jun. 30, 2023 | $ 160 | $ 89,127 | $ (81,883) | $ 7,404 | $ 12,126 | $ 19,530 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net loss | $ (10,384) | $ (6,429) |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation | 14,044 | 13,318 |
Amortization of deferred financing costs | 675 | 626 |
Amortization of deferred costs and intangible assets | 292 | 360 |
Amortization of above- and below-market leases | (17) | (17) |
Loss on extinguishment of debt | 3,868 | 0 |
Deferred rent | 27 | (190) |
Stock-based compensation | 1,431 | 1,209 |
Bad debt (recovery) expense | (142) | (379) |
Changes in operating assets and liabilities: | ||
Tenant and other receivables | (18) | 150 |
Prepaid expenses, other assets and deferred costs | 7,608 | 3,615 |
Accounts payable and accrued liabilities | (424) | (510) |
Security deposits | 720 | 476 |
Other liabilities | (459) | (547) |
Net cash provided by operating activities | 17,221 | 11,682 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Additions to land, buildings, and improvements | (18,915) | (24,851) |
Return of acquisition deposits | 0 | 2,015 |
Cash paid in connection with acquisition of real estate | 0 | (8,043) |
Net cash used in investing activities | (18,915) | (30,879) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Payments of mortgage notes | (46,810) | (1,101) |
Proceeds from mortgage notes | 62,330 | 20,839 |
Dividends and distributions | (8,696) | (8,461) |
Loan issuance and extinguishment costs | (4,723) | (335) |
Net cash provided by financing activities | 2,101 | 10,942 |
Net increase (decrease) in cash and cash equivalents and restricted cash | 407 | (8,255) |
Cash and cash equivalents and restricted cash - beginning of period | 30,666 | 52,224 |
Cash and cash equivalents and restricted cash - end of period | 31,073 | 43,969 |
Cash and cash equivalents and restricted cash – beginning of period: | ||
Cash and cash equivalents | 18,152 | 34,524 |
Restricted cash | 12,514 | 17,700 |
Cash and cash equivalents and restricted cash - beginning of period | 30,666 | 52,224 |
Cash and cash equivalents | 16,342 | 29,432 |
Restricted cash | 14,731 | 14,537 |
Cash and cash equivalents and restricted cash - end of period | 31,073 | 43,969 |
Supplemental cash flow information: | ||
Cash paid for interest, net of capitalized interest of $3,258 and $2,309 in 2023 and 2022, respectively | 21,099 | 19,423 |
Non-cash interest capitalized to real estate under development | 27 | 1,118 |
Additions to investment in real estate included in accounts payable and accrued liabilities | $ 3,527 | $ 7,158 |
Consolidated Statements of Ca_2
Consolidated Statements of Cash Flows (Unaudited) (Parentheticals) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Jun. 30, 2022 | |
Interest Paid, Capitalized, Investing Activities | $ 3,258 | $ 2,309 |
Note 1 - Organization
Note 1 - Organization | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Organization, Consolidation and Presentation of Financial Statements Disclosure [Text Block] | 1. Organization As of June 30, 2023, the properties owned by the Company consist of the following (collectively, the “Properties”): • Tribeca House in Manhattan, comprising two • Flatbush Gardens in Brooklyn, a 59-building residential housing complex with 2,494 rentable units and approximately 1,749,000 square feet of residential rental GLA; • 141 Livingston Street in Brooklyn, a 15-story office building with approximately 216,000 square feet of GLA; • 250 Livingston Street in Brooklyn, a 12-story office and residential building with approximately 370,000 square feet of GLA (fully remeasured); • Aspen in Manhattan, a 7-story building containing residential and retail space with approximately 166,000 square feet of residential rental GLA and approximately 21,000 square feet of retail rental GLA; • Clover House in Brooklyn, a 11-story residential building with approximately 102,000 square feet of residential rental GLA; • 10 West 65 th • 1010 Pacific Street in Brooklyn, 9-story residential building with approximately 119,000 square feet of residential rental GLA; and • the Dean Street property, which the Company plans to redevelop as a 9-story residential building with approximately 160,000 square feet of residential rental GLA and approximately 9,000 square feet of retail rental GLA. In February and April 2022, the Company purchased additional parcels of land for $3.7 million and $4.3 million, respectively, and, in August 2022, paid $2.5 million to a tenant to vacate a leased parcel. During 2019, we entered into a joint venture in which we own a 50% interest through which we are paying certain legal and advisory expenses in connection with various rent laws and ordinances which govern certain of our properties. During the three and six months ended June 30, 2023, the Company incurred $0.00 million and $0.00 million, respectively, and during the three and six months ended June 30, 2022, the Company incurred $0.09 million and $0.11 million, respectively of such expenses, which are recorded as part of general and administrative in the Condensed Consolidated Statements of Operations, and the Company has fulfilled its commitment in the joint venture. On June 29, 2023 the Company’ Flatbush Gardens property entered into 40 year regulatory agreement under Article 11 of the Private Housing Finance Law with the New York City Department Housing Preservation and Development (“Article 11 Agreement”). For the full term of the agreement, Flatbush Gardens received a full exemption from property taxes, committed to maintain rents with existing area median income groups, received eligibility for incremental rental assistance payments under Section 610 of the Private Housing Financing Law for tenants receiving government rental assistance, committed to lease 249 units to formerly homeless families and provide certain services as units become vacant, and committed to pay prevailing wage rates to employees of the property as defined under New York City regulations. The property also committed to a 3 year capital improvements plan. As part of the agreement, a new not-for-profit Corporation, Flatbush Gardens Housing Development Fund Corporation (“HDFC”), became nominal owner of the Flatbush Gardens properties. This has no effect on the beneficial operations and finances of the properties but provides HDFC with certain consent rights for transfers and financings of the properties. (See Note 8 Commitments and Contingencies). The operations of Clipper Realty Inc. and its consolidated subsidiaries are carried on primarily through the Operating Partnership. The Company has elected to be taxed as a Real Estate Investment Trust (“REIT”) under Sections 856 through 860 of the Internal Revenue Code (the “Code”). The Company is the sole general partner of the Operating Partnership and the Operating Partnership is the sole managing member of the LLCs that comprised the Predecessor. At June 30, 2023, the Company’s interest, through the Operating Partnership, in the LLCs that own the properties generally entitles it to 37.9% of the aggregate cash distributions from, and the profits and losses of, the LLCs. The Company determined that the Operating Partnership and the LLCs are variable interest entities (“VIEs”) and that the Company had control over these entities and was the primary beneficiary. The assets and liabilities of these VIEs represented substantially all of the Company’s assets and liabilities. |
Note 2 - Significant Accounting
Note 2 - Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Significant Accounting Policies [Text Block] | 2. Significant Accounting Policies Segments At June 30, 2023, the Company had two Basis of Consolidation The accompanying consolidated financial statements of the Company are prepared in accordance with GAAP. The effect of all intercompany balances has been eliminated. The consolidated financial statements include the accounts of all entities in which the Company has a controlling interest. The ownership interests of other investors in these entities are recorded as non-controlling interests. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of commitments and contingencies at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from these estimates. Investment in Real Estate Real estate assets held for investment are carried at historical cost and consist of land, buildings and improvements, furniture, fixtures and equipment. Expenditures for ordinary repair and maintenance costs are charged to expense as incurred. Expenditures for improvements, renovations, and replacements of real estate assets are capitalized and depreciated over their estimated useful lives if the expenditures qualify as betterment or the life of the related asset will be substantially extended beyond the original life expectancy. In accordance with ASU 2018-01, "Business Combinations – Clarifying the Definition of a Business,” the Company evaluates each acquisition of real estate or in-substance real estate to determine if the integrated set of assets and activities acquired meets the definition of a business and needs to be accounted for as a business combination. If either of the following criteria is met, the integrated set of assets and activities acquired would not qualify as a business: • Substantially all of the fair value of the gross assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets; or • The integrated set of assets and activities is lacking, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs (i.e., revenue generated before and after the transaction). An acquired process is considered substantive if: • The process includes an organized workforce (or includes an acquired contract that provides access to an organized workforce) that is skilled, knowledgeable and experienced in performing the process: • The process cannot be replaced without significant cost, effort or delay; or • The process is considered unique or scarce. Generally, the Company expects that acquisitions of real estate or in-substance real estate will not meet the revised definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e., land, buildings and related intangible assets) or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay. Upon acquisition of real estate, the Company assesses the fair values of acquired tangible and intangible assets including land, buildings, tenant improvements, above-market and below-market leases, in-place leases and any other identified intangible assets and assumed liabilities. The Company allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. In estimating fair value of tangible and intangible assets acquired, the Company assesses and considers fair value based on estimated cash flow projections that utilize appropriate discount and capitalization rates, estimates of replacement costs, net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant. The Company records acquired above-market and below-market lease values initially based on the present value, using a discount rate which reflects the risks associated with the leases acquired based on the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed renewal options for the below-market leases. Other intangible assets acquired include amounts for in-place lease values and tenant relationship values (if any) that are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in-place lease values include an estimate of carrying costs to execute similar leases. In estimating carrying costs, management includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. A property’s value is impaired if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, a write-down is recorded and measured by the amount of the difference between the carrying value of the asset and the fair value of the asset. In the event that the Company obtains proceeds through an insurance policy due to impairment, the proceeds are offset against the write-down in calculating gain/loss on disposal of assets. Management of the Company does not believe that any of its properties within the portfolio are impaired as of June 30, 2023. For long-lived assets to be disposed of, impairment losses are recognized when the fair value of the assets less estimated cost to sell is less than the carrying value of the assets. Properties classified as real estate held-for-sale generally represent properties that are actively marketed or contracted for sale with closing expected to occur within the next twelve months. Real estate held-for-sale is carried at the lower of cost, net of accumulated depreciation, or fair value less cost to sell, determined on an asset-by-asset basis. Expenditures for ordinary repair and maintenance costs on held-for-sale properties are charged to expense as incurred. Expenditures for improvements, renovations and replacements related to held-for-sale properties are capitalized at cost. Depreciation is not recorded on real estate held-for-sale. If a tenant vacates its space prior to the contractual termination of the lease and no rental payments are being made on the lease, any unamortized balances of the related intangibles are written off. The tenant improvements and origination costs are amortized to expense over the remaining life of the lease (or charged against earnings if the lease is terminated prior to its contractual expiration date). Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Building and improvements (in years) 10 – 44 Tenant improvements Shorter of useful life or lease term Furniture, fixtures and equipment (in years) 3 – 15 The capitalized above-market lease values are amortized as a reduction to base rental revenue over the remaining terms of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed rate renewal options of the respective leases. The value of in-place leases is amortized to expense over the remaining initial terms of the respective leases. Cash and Cash Equivalents Cash and cash equivalents are defined as cash on hand and in banks, plus all short-term investments with a maturity of three months or less when purchased. The Company maintains some of its cash in bank deposit accounts, which, at times, may exceed the federally insured limit. No losses have been experienced related to such accounts. Restricted Cash Restricted cash generally consists of escrows for future real estate taxes and insurance expenditures, repairs, capital improvements, loan reserves and security deposits. Tenant and Other Receivables and Allowance for Doubtful Accounts Tenant and other receivables are comprised of amounts due for monthly rents and other charges less allowance for doubtful accounts. As described more fully under Revenue Recognition Deferred Costs Deferred lease costs consist of fees incurred to initiate and renew operating leases. Lease costs are being amortized using the straight-line method over the terms of the respective leases. Deferred financing costs represent commitment fees, legal and other third-party costs associated with obtaining financing. These costs are amortized over the term of the financing and are recorded in interest expense in the consolidated statements of operations. Unamortized deferred financing costs are expensed when the associated debt is refinanced or repaid before maturity. Costs incurred in seeking financing transactions which do not close are expensed in the period the financing transaction is terminated. Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) adjusted for changes in unrealized gains and losses, reported in equity, for financial instruments required to be reported at fair value under GAAP. For the three and six months ended June 30, 2023 and 2022, the Company did not own any financial instruments for which the change in value was not reported in net income (loss); accordingly, its comprehensive income (loss) was its net income (loss) as presented in the consolidated statements of operations. Revenue Recognition As mentioned above under Tenant and Other Receivables and Allowance for Doubtful Accounts, effective the first quarter of 2022, the Company has adopted ASC 842, “Leases” which replaces the guidance under ASC 840. ASC 842 applies to the Company principally as lessor; as a lessee, the Company’s leases are immaterial. The Company has determined that all its leases as lessor are operating leases. The Company has elected to not bifurcate lease and non-lease components under a practical expedient provision. With respect to collectability, beginning the first quarter of 2022, the Company has written off all receivables not probable of collection and related deferred rent, and has recorded income for those tenants on a cash basis. When the probability assessment has changed for these receivables, the Company has recognized lease income to the extent of the difference between the lease income that would have been recognized if collectability had always been assessed as probable and the lease income recognized to date. For remaining receivables probable of collection, the Company has recorded a general reserve under ASC 450. In the three and six months ended June 30, 2023 the Company has charged revenue in the amount of $0.9 million and $2.4 million, respectively for residential receivables not deemed probable of collection and recognized revenue of $0.4 million and $1.1 million respectively, for a reassessment of collectability of residential receivables previously not deemed probable of collection. In the three and six months ended June 30, 2022, the Company has charged revenue in the amount of $2.0 million and $3.4 million, respectively, for residential receivables not deemed probable of collection. and recognized revenue of $1.4 million and $2.1 million respectively, for a reassessment of collectability of residential receivables previously not deemed probable of collection. Additionally, during the six-months ended June 30, 2022 the Company recognized a net $1.1 million for a reassessment of collectability of one commercial tenant at Tribeca House that was determined to be probable of collection. In transitioning to ASC 842 in the first quarter of 2022, the Company elected the modified retrospective approach to existing leases at the beginning of the quarter and has recorded a cumulative-effect adjustment in retained earnings using the above methods applied to balances as of December 31, 2021, of $6.0 million. In accordance with the provisions of ASC 842, rental revenue for commercial leases is recognized on a straight-line basis over the terms of the respective leases. Deferred rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with lease agreements. Rental income attributable to residential leases and parking is recognized as earned, which is not materially different from the straight-line basis. Leases entered by residents for apartment units are generally for one-year terms, renewable upon consent of both parties on an annual or monthly basis. Reimbursements for operating expenses due from tenants pursuant to their lease agreements are recognized as revenue in the period the applicable expenses are incurred. These costs generally include real estate taxes, utilities, insurance, common area maintenance costs and other recoverable costs and are recorded as part of commercial rental income in the condensed consolidated statements of operations. Stock-based Compensation The Company accounts for stock-based compensation pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, “Compensation — Stock Compensation.” As such, all equity-based awards are reflected as compensation expense in the Company’s consolidated statements of operations over their vesting period based on the fair value at the date of grant. In the event of a forfeiture, the previously recognized expense would be reversed. As of June 30, 2023, and December 31, 2022, there were 3,382,465 and 2,949,823 long-term incentive plan (“LTIP”) units outstanding, respectively, with a weighted average grant date fair value of $8.80 and $9.26 per unit, respectively. As of June 30, 2023, and December 31, 2022, there was $11.2 million and $10.2 million, respectively, of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under share incentive plans. As of June 30, 2023, the weighted-average period over which the unrecognized compensation expense will be recorded is approximately four In March 2023, the Company granted employees and non-employee directors 274,911 and 157,731 LTIP units, respectively, with a weighted-average grant date value of $5.62 per unit. The grants vesting period range from up to one In April 2022, the Company granted employees and non-employee directors 900,000 and 275,000 LTIP units, respectively, with a weighted-average grant date value of $8.70 per unit, substantially all which vest in 10 years. Of these grants, 270,000 and 82,500 were approved by the shareholders of the Company at the 2022 Annual Meeting of the Shareholders on June 15, 2022 to increase the number of shares issuable under the Company’s 2015 Omnibus Incentive Plan and the 2015 Non-Employee Director Plan by 1.3 million and 0.5 million shares, respectively. Transaction Pursuit Costs Transaction pursuit costs primarily reflect costs incurred for abandoned acquisition, disposition or other transaction pursuits. During the three- and six-month periods ended June 30, 2023 Transaction pursuit costs include $357 of costs related to the Article 11 Agreement. During the three- and six-month periods ended June 30, 2022 the company incurred $92 and $516, respectively, primarily for an abandoned acquisition, as well as the acquisition of the Dean Street property. Income Taxes The Company elected to be taxed and to operate in a manner that will allow it to qualify as a REIT under the Code. To qualify as a REIT, the Company is required to distribute dividends equal to at least 90% of the REIT taxable income (computed without regard to the dividends paid deduction and net capital gains) to its stockholders, and meet the various other requirements imposed by the Code relating to matters such as operating results, asset holdings, distribution levels and diversity of stock ownership. Provided the Company qualifies for taxation as a REIT, it is generally not subject to U.S. federal corporate-level income tax on the earnings distributed currently to its stockholders. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to U.S. federal and state income tax on its taxable income at regular corporate tax rates and any applicable alternative minimum tax. In addition, the Company may not be able to re-elect as a REIT for the four subsequent taxable years. The entities comprising the Predecessor are limited liability companies and are treated as pass-through entities for income tax purposes. Accordingly, no In accordance with FASB ASC Topic 740, the Company believes that it has appropriate support for the income tax positions taken and, as such, does not have any uncertain tax positions that, if successfully challenged, could result in a material impact on its financial position or results of operations. The prior three years’ income tax returns are subject to review by the Internal Revenue Service. Fair Value Measurements Refer to Note 7, “Fair Value of Financial Instruments”. Derivative Financial Instruments FASB derivative and hedging guidance establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. As required by FASB guidance, the Company records all derivatives on the consolidated balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and the resulting designation. Derivatives used to hedge the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives used to hedge the exposure to variability in expected future cash flows, or other types of forecast transactions, are considered cash flow hedges. For derivatives designated as fair value hedges, changes in the fair value of the derivative and the hedged item related to the hedged risk are recognized in earnings. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in other comprehensive income (loss) (outside of earnings) and subsequently reclassified to earnings when the hedged transaction affects earnings, and the ineffective portion of changes in the fair value of the derivative is recognized directly in earnings. The Company assesses the effectiveness of each hedging relationship by comparing the changes in the fair value or cash flows of the derivative hedging instrument with the changes in the fair value or cash flows of the designated hedged item or transaction. For derivatives not designated as hedges, changes in fair value would be recognized in earnings. As of June 30, 2023, the Company has no derivatives for which it applies hedge accounting. Loss Per Share Basic and diluted net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding. As of June 30, 2023 and 2022, the Company had unvested LTIP units which provide for non-forfeitable rights to dividend-equivalent payments. Accordingly, these unvested LTIP units are considered participating securities and are included in the computation of basic and diluted net loss per share pursuant to the two-class method. The Company did not The effect of the conversion of the 26,317 Class B LLC units outstanding is not reflected in the computation of basic and diluted net loss per share, as the effect would be anti-dilutive. The net loss allocable to such units is reflected as non-controlling interests in the accompanying consolidated financial statements. The following table sets forth the computation of basic and diluted net loss per share for the periods indicated (unaudited): Three Months Ended June 30, Six Months Ended June 30, (in thousands, except per share amounts) 2023 2022 2023 2022 Numerator Net loss attributable to common stockholders $ (1,249 ) $ (1,119 ) $ (3,936 ) $ (2,437 ) Less: income attributable to participating securities (322 ) (246 ) (644 ) (408 ) Subtotal $ (1,571 ) $ (1,365 ) $ (4,580 ) $ (2,845 ) Denominator Weighted-average common shares outstanding 16,063 16,063 16,063 16,063 Basic and diluted net loss per share attributable to common stockholders $ (0.10 ) $ (0.08 ) $ (0.29 ) $ (0.18 ) Recently Issued Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This ASU requires entities to estimate a lifetime expected credit loss for most financial assets, including trade and other receivables and other long term financings including available for sale and held-to-maturity debt securities, and loans. Subsequently, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which amends the scope of ASU 2016-13 and clarified that receivables arising from operating leases are not within the scope of the standard and should continue to be accounted for in accordance with the leases standard (Topic 842). As a result, the adoption of the standard as of January 1, 2022 did not have a material impact on the consolidated financial statements. In March 2020, FASB issued ASU 2020-04, “Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting” (Topic 848). ASU 2020-04 provides temporary optional expedients and exceptions to ease financial reporting burdens related to applying current GAAP to modifications of contracts, hedging relationships and other transactions in connection with the transition from the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. ASU 2020-04 is effective beginning on March 12, 2020, and may be applied prospectively to such transactions through December 31, 2022. We will apply ASU 2020-04 prospectively as and when we enter transactions to which this guidance applies. In January 2021, FASB issued ASU 2021-01, “Reference Rate Reform” (Topic 848). ASU 2021-01 modifies ASC 848 (ASU 2020-04), which was intended to provide relief related to “contracts and transactions that reference LIBOR or a reference rate that is expected to be discontinued as a result of reference rate reform.” ASU 2021-01 expands the scope of ASC 848 to include all affected derivatives and give reporting entities the ability to apply certain aspects of the contract modification and hedge accounting expedients to derivative contracts affected by the discounting transition. ASU 2021-01 also adds implementation guidance to clarify which optional expedients in ASC 848 may be applied to derivative instruments that do not reference LIBOR or a reference rate that is expected to be discontinued, but that are being modified as a result of the discounting transition. The Company does not expect the adoption of ASU 2021-01 to have a material impact on its consolidated financial statements. |
Note 3 - Acquisitions
Note 3 - Acquisitions | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Business Combination Disclosure [Text Block] | 3. Acquisitions During the six months ended June 30, 2022 the Company acquired additional parcels of land for the Dean Street property, for $3,701 including acquisition costs of $151. |
Note 4 - Deferred Costs and Int
Note 4 - Deferred Costs and Intangible Assets | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Deferred Costs and Intangible Assets Disclosure [Text Block] | 4. Deferred Costs and Intangible Assets Deferred costs and intangible assets consist of the following: June 30, 2023 December 31, 2022 (unaudited) Deferred costs $ 348 $ 348 Lease origination costs 1,463 1,376 In-place leases 428 428 Real estate tax abatements 9,142 9,142 Total deferred costs and intangible assets 11,381 11,294 Less accumulated amortization (4,963 ) (4,670 ) Total deferred costs and intangible assets, net $ 6,418 $ 6,624 Amortization of deferred costs, lease origination costs and in-place lease intangible assets was $26 and $60 for the three months ended June 30, 2023 and 2022, respectively, and $51 and $119 for the six months ended June 30, 2023 and 2022, respectively; Amortization of real estate tax abatements of $120 and $121 for the three months ended June 30, 2023 and 2022, respectively, and $241 and $241 for the six months ended June 30, 2023 and 2022, is included in real estate taxes and insurance in the consolidated statements of operations. Deferred costs and intangible assets as of June 30, 2023, amortize in future years as follows: 2023 (Remainder) $ 305 2024 587 2025 570 2026 546 2027 534 Thereafter 3,876 Total $ 6,418 |
Note 5 - Notes Payable
Note 5 - Notes Payable | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Long-Term Debt [Text Block] | 5. Notes Payable The mortgages, loans and mezzanine notes payable collateralized by the properties, or the Company’s interest in the entities that own the properties and assignment of leases, are as follows: Property Maturity Interest Rate June 30, 2023 December 31, 2022 Flatbush Gardens, Brooklyn, NY (a) 6/1/2032 3.125% $ 329,000 $ 329,000 250 Livingston Street, Brooklyn, NY (b) 6/6/2029 3.63% 125,000 125,000 141 Livingston Street, Brooklyn, NY (c) 3/6/2031 3.21% 100,000 100,000 Tribeca House, Manhattan, NY (d) 3/6/2028 4.506% 360,000 360,000 Aspen, Manhattan, NY (e) 7/1/2028 3.68% 61,783 62,554 Clover House, Brooklyn, NY (f) 12/1/2029 3.53% 82,000 82,000 10 West 65 th 11/1/2027 SOFR + 2.50% 31,991 32,222 1010 Pacific Street, Brooklyn, NY (h) 9/1/2024 LIBOR + 3.60% — 43,477 1010 Pacific Street, Brooklyn, NY (h) 2/9/2028 5.55% 60,000 — Dean Street, Brooklyn, NY (i) 9/22/2023 Prime + 1.60% 36,985 36,985 Total debt $ 1,186,759 $ 1,171,238 Unamortized debt issuance costs (9,803 ) (9,650 ) Total debt, net of unamortized debt issuance costs $ 1,176,956 $ 1,161,588 (a) The $329,000 mortgage note agreement with New York Community Bank (“NYCB”), entered into on May 8, 2020, matures on June 1, 2032, and bears interest at 3.125% through May 2027 and thereafter at the prime rate plus 2.75%, subject to an option to fix the rate. The note requires interest-only payments through May 2027, and monthly principal and interest payments thereafter based on a 30-year amortization schedule. The Company has the option to prepay all (but not less than all) of the unpaid balance of the note prior to the maturity date, subject to certain prepayment premiums, as defined. (b) The $125,000 mortgage note agreement with Citi Real Estate Funding Inc., entered into on May 31, 2019, matures on June 6, 2029, bears interest at 3.63% and requires interest-only payments for the entire term. The Company has the option to prepay all (but not less than all) of the unpaid balance of the note within three (c), The $100,000 mortgage note agreement with Citi Real Estate Funding Inc., entered into on February 18, 2021 matures on March 6, 2031, bears interest at 3.21% and requires interest-only payments for the entire term. The Company has the option to prepay all (but not less than all) of the unpaid balance of the note within three months of maturity, without a prepayment premium. (d) The $360,000 loan with Deutsche Bank, entered into on February 21, 2018, matures on March 6, 2028, bears interest at 4.506% and requires interest-only payments for the entire term. The Company has the option to prepay all (but not less than all) of the unpaid balance of the loan prior to the maturity date, subject to a prepayment premium if it occurs prior to December 6, 2027. (e) The $70,000 mortgage note agreement with Capital One Multifamily Finance LLC matures on July 1, 2028, and bears interest at 3.68%. The note required interest-only payments through July 2017, and monthly principal and interest payments of $321 thereafter based on a 30-year amortization schedule. The Company has the option to prepay the note prior to the maturity date, subject to a prepayment premium. (f) The $82,000 mortgage note agreement with MetLife Investment Management, entered into on November 8, 2019, matures on December 1, 2029, bears interest at 3.53% and requires interest-only payments for the entire term. The Company has the option, commencing on January 1, 2024, to prepay the note prior to the maturity date, subject to a prepayment premium if it occurs prior to September 2, 2029. (g) The $32,200 mortgage note agreement with NYCB entered into in connection with the acquisition of the property matures on November 1, 2027. Through October 2022 the Company paid a fixed interest rate of 3.375% and thereafter was scheduled to pay interest at the prime rate plus 2.75%, subject to an option to fix the rate. On August 26, 2022, the Company and NYCB amended the note to replace prime plus 2.75% rate with SOFR plus 2.5% (7.25 (h) On December 24, 2019, the Company entered into a $18,600 mortgage note agreement with CIT Bank, N.A., related to the 1010 Pacific Street acquisition. The Company also entered into a pre-development bridge loan secured by the property with the same lender to provide up to $2,987 for eligible pre-development and carrying costs. The notes were scheduled to mature on June 24, 2021, required interest-only payments and bore interest at one-month LIBOR (with a floor of 1.25%) (4.85 On August 10, 2021, the Company refinanced the above 1010 Pacific Street loan with a group of loans with AIG Asset Management (U.S.), LLC providing for maximum borrowings of $52,500 to develop the property. The notes had a 36-month term, bearing interest at 30 days LIBOR plus 3.60% (with a floor of 4.1%) (9.35 On February 9, 2023 the Company refinanced this construction loan with a mortgage loan with Valley National Bank providing for maximum borrowings of $80,000. The loan provided initial funding of $60,000 and a further $20,000 subject to achievement of certain financial targets. The loan has a term of five years and an initial annual interest rate of 5.7% subject to reduction by up to 25 basis points upon achievement of certain financial targets. The interest rate on subsequent fundings will be fixed at the time of any funding. The loan requires interest-only payments for the first two years and principal and interest thereafter based on a 30-year amortization schedule. The Company has the option to prepay in full, or in part, the unpaid balance of the note prior to the maturity date. Prior to the second anniversary of the date of the note prepayment is subject to certain prepayment premiums, as defined. After the second anniversary of the date of the note the prepayment is not subject to a prepayment premium. During the quarter ended June 30, 2023 the company achieved a financial target and the interest rate was reduced by 15 basis points to 5.55%. In conjunction with the refinancing the Company incurred $3,868 of loan extinguishment costs related to prepayment penalties, writing off unamortized deferred financed costs of the previous loan and other fees. These costs are included in the consolidated statement of operations for the six-month period ended June 30, 2023. (i) On December 22, 2021, the Company entered into a $30,000 mortgage note agreement with Bank Leumi, N.A related to the Dean Street acquisition. The notes original maturity was December 22, 2022 and was subsequently extended to September 22, 2023. The note requires interest-only payments and bears interest at the prime rate (with a floor of 3.25%) (9.85 The Company has provided a limited guaranty for the mortgage notes at several of its properties. The Company’s loan agreements contain customary representations, covenants and events of default. Certain loan agreements require the Company to comply with affirmative and negative covenants, including the maintenance of debt service coverage and debt yield ratios. In the event that they are not compliant, certain lenders may require cash sweeps of rent until the conditions are cured. The Company believes it is not in default on any of its loan agreements. The following table summarizes principal payment requirements under the terms of the mortgage notes as of June 30, 2023: 2023 (Remainder) $ 37,956 2024 2,009 2025 2,803 2026 3,000 2027 34,215 Thereafter 1,106,776 Total $ 1,186,759 |
Note 6 - Rental Income Under Op
Note 6 - Rental Income Under Operating Leases | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Lessor, Operating Leases [Text Block] | 6. Rental Income under Operating Leases The Company’s commercial properties are leased to commercial tenants under operating leases with fixed terms of varying lengths. As of June 30, 2023, the minimum future cash rents receivable (excluding tenant reimbursements for operating expenses) under non-cancelable operating leases for the commercial tenants in each of the next five years and thereafter are as follows: 2023 (Remainder) $ 15,166 2024 30,457 2025 24,822 2026 4,548 2027 3,915 Thereafter 19,315 Total $ 98,223 The Company has commercial leases with the City of New York that comprised approximately 23% and 24% of total revenues for the three months ended June 30, 2023 and 2022, respectively, and 23% and 24% of total revenues for the six months ended June 30, 2023 and 2022, respectively. |
Note 7 - Fair Value of Financia
Note 7 - Fair Value of Financial Instruments | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Fair Value Disclosures [Text Block] | 7. Fair Value of Financial Instruments GAAP requires the measurement of certain financial instruments at fair value on a recurring basis. In addition, GAAP requires the measure of other financial instruments and balances at fair value on a non-recurring basis (e.g., carrying ‐‐‐value of impaired real estate and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories: • Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities; • Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and • Level 3: prices or valuation techniques where little or no market data is available that require inputs that are both significant to the fair value measurement and unobservable. When available, the Company utilizes quoted market prices from an independent third-party source to determine fair value and classifies such items in Level 1 or Level 2. In instances where the market for a financial instrument is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for a financial instrument owned by the Company to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and establishes a fair value by assigning weights to the various valuation sources. Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument. The financial assets and liabilities in the consolidated balance sheets include cash and cash equivalents, restricted cash, receivables, prepaid expenses, accounts payable and accrued liabilities, security deposits and notes payable. The carrying amount of cash and cash equivalents, restricted cash, receivables, prepaid expenses, accounts payable and accrued liabilities, and security deposits reported in the consolidated balance sheets approximates fair value due to the short-term nature of these instruments. The fair value of notes payable, which are classified as Level 2, is estimated by discounting the contractual cash flows of each debt instrument to their present value using adjusted market interest rates. The carrying amount and estimated fair value of the notes payable are as follows: June 30, 2023 December 31, 2022 (unaudited) Carrying amount (excluding unamortized debt issuance costs) $ 1,186,759 $ 1,171,238 Estimated fair value $ 1,078,697 $ 1,092,345 |
Note 8 - Commitments and Contin
Note 8 - Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Commitments and Contingencies Disclosure [Text Block] | 8. Commitments and Contingencies Legal On July 3, 2017, the Supreme Court of the State of New York (the “Court”) ruled in favor of 41 present or former tenants of apartment units at the Company’s buildings located at 50 Murray Street and 53 Park Place in Manhattan, New York (the Tribeca House property), who brought an action (the “Kuzmich” case) against the Company alleging that they were subject to applicable rent stabilization laws with the result that rental payments charged by the Company exceeded amounts permitted under these laws because the buildings were receiving certain tax abatements under Real Property Tax Law (“RPTL”) 421-g. The Court also awarded the plaintiffs- tenants their attorney’s fees and costs. After various court proceedings and discussions from 2018-2022, on March 4, 2022 the court issued a ruling, finalized on May 9, 2022, on the rent overcharges to which the plaintiffs are entitled. While the court ruled that the overcharges to which the plaintiffs are entitled total $1.2 million, the court agreed with the Company’s legal arguments that rendered the overcharge liability lower than it could have been, and therefore the Company did not appeal the ruling. On June 23, 2022, the court ruled that the plaintiffs are entitled to attorneys’ fees incurred through February 28, 2022, in the amount of $0.4 million. On November 18, 2019, the same law firm which filed the Kuzmich case filed a second action involving a separate group of 26 tenants (captioned Crowe et al v 50 Murray Street Acquisition LLC, Supreme Court, New York County, Index No. 161227/19), which action advances essentially the same claims as in Kuzmich. The Company’s deadline to answer or otherwise respond to the complaint in Crowe had been extended to June 30, 2020; on such date, the Company filed its answer to the complaint. Pursuant to the court’s rules, on July 16, 2020, the plaintiffs filed an amended complaint; the sole difference as compared to the initial complaint is that seven new plaintiffs-tenants were added to the caption; there were no substantive changes to the complaint’s allegations. On August 5, 2020, the Company filed its answer to the amended complaint. The case was placed on the court’s calendar and was next scheduled for a discovery conference on November 16, 2022. Counsel for the parties have been engaged in and are continuing settlement discussions. On November 16, 2022, the court held a compliance conference and ordered the plaintiffs to provide rent overcharge calculations in response to proposed calculations previously provided by the Company. On July 12, 2023, the court referred this matter to a Judicial Hearing Officer (“JHO”) to determine the outstanding issues. A hearing before the JHO is scheduled for August 3, 2023.. On March 9, 2021, the same law firm which filed the Kuzmich and Crowe cases filed a third action involving another tenant (captioned Horn v 50 Murray Street Acquisition LLC, Supreme Court, New York County, Index No. 152415/21), which action advances the same claims as in Kuzmich and Crowe. The Company filed its answer to the complaint on May 21, 2021. As a result of the March 4 and May 9, 2022 decisions which established the probability and ability to reasonably compute amounts owed to tenants for all the cases, the Company recorded a charge for litigation settlement and other of $2.7 million in the consolidated statements of operations during the year ended December 31, 2021 comprising rent overcharges, interest and legal costs of plaintiff’s counsel. The Company paid $2.3 million to the plaintiffs related to the Kuzmich case during the year ended December 31, 2022 and $0.4 million related to the Crowe case during the six month period ended June 30, 2023. In addition to the above, the Company is subject to certain legal proceedings and claims arising in connection with its business. Management believes, based in part upon consultation with legal counsel, that the ultimate resolution of all such claims will not have a material adverse effect on the Company’s consolidated results of operations, financial position or cash flows. The Office of the Attorney General of the State of New York (“OAG”) commenced an investigation concerning the conduct of screening of tenant applicants in the building portfolio in which Clipper Equity and its principals have a management and/or ownership interest. Clipper Equity cooperated with the investigation and, in April 2022, entered into an Assurance of Discontinuance with the OAG to resolve the investigation on behalf of itself and its affiliates, the terms of which have no impact to the Company’s financial position or results of operations. Commitments June 29, 2023 the Company entered into the Article 11 Agreement Under the Article 11 agreement, the Company has entered into a Housing Repair and Maintenance Letter Agreement in which the Company has agreed to perform certain capital improvements to Flatbush Gardens over the next 3 years. The current estimate is that the costs of that work will be an amount up to $27 million. The Company expects those costs to be offset by the savings provided by property tax exemption and enhanced payments for tenants receiving government assistance (See note 1). The Company is obligated to provide parking availability through August 2025 under a lease with a tenant at the 250 Livingston Street property; the current cost to the Company is approximately $205 per year. Concentrations The Company’s properties are located in the Boroughs of Manhattan and Brooklyn in New York City, which exposes the Company to greater economic risks than if it owned a more geographically dispersed portfolio. The breakdown between commercial and residential revenue is as follows (unaudited): Commercial Residential Total Three months ended June 30, 2023 28 % 72 % 100 % Three months ended June 30, 2022 29 % 71 % 100 % Six months ended June 30, 2023 28 % 72 % 100 % Six months ended June 30, 2022 31 % 69 % 100 % |
Note 9 - Related-party Transact
Note 9 - Related-party Transactions | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Related Party Transactions Disclosure [Text Block] | 9. Related-Party Transactions The Company recorded office and overhead expenses pertaining to a related company in general and administrative expense of $133 and $64 for the three months ended June 30, 2023 and 2022, respectively, and $198 and $128 for the six months ended June 30, 2023 and 2022. The Company recognized a charge/(credit) to reimbursable payroll expense pertaining to a related company in general and administrative expense of $ (53) (9) (30) (17) |
Note 10 - Segment Reporting
Note 10 - Segment Reporting | 6 Months Ended |
Jun. 30, 2023 | |
Notes to Financial Statements | |
Segment Reporting Disclosure [Text Block] | 10. Segment Reporting The Company has classified its reporting segments into commercial and residential rental properties. The commercial reporting segment includes the 141 Livingston Street property and portions of the 250 Livingston Street, Tribeca House and Aspen properties. The residential reporting segment includes the Flatbush Gardens property, the Clover House property, the 10 West 65 th The Company’s income from operations by segment for the three and six months ended June 30, 2023 and 2022, is as follows (unaudited): Three months ended June 30, 2023 Commercial Residential Total Rental income $ 9,503 $ 25,040 $ 34,543 Total revenues $ 9,503 $ 25,040 $ 34,543 Property operating expenses 1,048 5,734 6,782 Real estate taxes and insurance 2,280 6,420 8,700 General and administrative 615 2,781 3,396 Transaction pursuit costs — 357 357 Depreciation and amortization 1,447 5,822 7,269 Total operating expenses 5,390 21,114 26,504 Income from operations $ 4,113 $ 3,926 $ 8,039 Three months ended June 30, 2022 Commercial Residential Total Rental income $ 9,290 $ 22,597 $ 31,887 Total revenues $ 9,290 $ 22,597 $ 31,887 Property operating expenses 1,184 5,744 6,928 Real estate taxes and insurance 2,016 5,870 7,886 General and administrative 624 2,573 3,197 Transaction pursuit costs 3 89 92 Depreciation and amortization 1,366 5,366 6,732 Total operating expenses 5,193 19,642 24,835 Income from operations 4,097 2,955 7,052 Six months ended June 30, 2023 Commercial Residential Total Rental income $ 19,230 $ 48,980 $ 68,210 Total revenues 19,230 48,980 68,210 Property operating expenses 2,263 12,618 14,881 Real estate taxes and insurance 4,529 12,707 17,236 General and administrative 1,186 5,503 6,689 Transaction pursuit costs — 357 357 Depreciation and amortization 2,889 11,205 14,094 Total operating expenses 10,867 42,390 53,257 Income from operations $ 8,363 $ 6,590 $ 14,953 Six months ended June 30, 2022 Commercial Residential Total Rental income $ 19,878 $ 44,059 $ 63,937 Total revenues 19,878 44,059 63,937 Property operating expenses 2,327 12,140 14,467 Real estate taxes and insurance 4,036 11,781 15,817 General and administrative 1,147 4,992 6,139 Transaction pursuit costs 81 435 516 Depreciation and amortization 2,722 10,715 13,437 Total operating expenses 10,313 40,063 50,376 Income from operations $ 9,565 $ 3,996 $ 13,561 The Company’s total assets by segment are as follows, as of: Commercial Residential Total June 30, 2023 (unaudited) $ 311,193 $ 914,626 $ 1,225,819 December 31, 2022 312,404 917,227 1,229,631 The Company’s interest expense by segment for the three and six months ended June 30, 2023 and 2022, is as follows (unaudited): Commercial Residential Total Three months ended June 30, 2023 $ 2,547 $ 8,787 $ 11,334 2022 $ 2,511 $ 7,494 $ 10,005 Six months ended June 30, 2023 $ 5,007 $ 16,462 $ 21,469 2022 $ 5,004 $ 14,986 $ 19,990 The Company’s capital expenditures, including acquisitions, by segment for the three and six months ended June 30, 2023 and 2022, are as follows (unaudited): Commercial Residential Total Three months ended June 30, 2023 $ 563 $ 5,858 $ 6,421 2022 $ 838 $ 15,332 $ 16,170 Six months ended June 30, 2023 $ 2,240 $ 15,347 $ 17,587 2022 $ 1,628 $ 30,976 $ 32,604 |
Significant Accounting Policies
Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2023 | |
Accounting Policies [Abstract] | |
Segment Reporting, Policy [Policy Text Block] | Segments At June 30, 2023, the Company had two |
Consolidation, Policy [Policy Text Block] | Basis of Consolidation The accompanying consolidated financial statements of the Company are prepared in accordance with GAAP. The effect of all intercompany balances has been eliminated. The consolidated financial statements include the accounts of all entities in which the Company has a controlling interest. The ownership interests of other investors in these entities are recorded as non-controlling interests. |
Use of Estimates, Policy [Policy Text Block] | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of commitments and contingencies at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from these estimates. |
Real Estate, Policy [Policy Text Block] | Investment in Real Estate Real estate assets held for investment are carried at historical cost and consist of land, buildings and improvements, furniture, fixtures and equipment. Expenditures for ordinary repair and maintenance costs are charged to expense as incurred. Expenditures for improvements, renovations, and replacements of real estate assets are capitalized and depreciated over their estimated useful lives if the expenditures qualify as betterment or the life of the related asset will be substantially extended beyond the original life expectancy. In accordance with ASU 2018-01, "Business Combinations – Clarifying the Definition of a Business,” the Company evaluates each acquisition of real estate or in-substance real estate to determine if the integrated set of assets and activities acquired meets the definition of a business and needs to be accounted for as a business combination. If either of the following criteria is met, the integrated set of assets and activities acquired would not qualify as a business: • Substantially all of the fair value of the gross assets acquired is concentrated in either a single identifiable asset or a group of similar identifiable assets; or • The integrated set of assets and activities is lacking, at a minimum, an input and a substantive process that together significantly contribute to the ability to create outputs (i.e., revenue generated before and after the transaction). An acquired process is considered substantive if: • The process includes an organized workforce (or includes an acquired contract that provides access to an organized workforce) that is skilled, knowledgeable and experienced in performing the process: • The process cannot be replaced without significant cost, effort or delay; or • The process is considered unique or scarce. Generally, the Company expects that acquisitions of real estate or in-substance real estate will not meet the revised definition of a business because substantially all of the fair value is concentrated in a single identifiable asset or group of similar identifiable assets (i.e., land, buildings and related intangible assets) or because the acquisition does not include a substantive process in the form of an acquired workforce or an acquired contract that cannot be replaced without significant cost, effort or delay. Upon acquisition of real estate, the Company assesses the fair values of acquired tangible and intangible assets including land, buildings, tenant improvements, above-market and below-market leases, in-place leases and any other identified intangible assets and assumed liabilities. The Company allocates the purchase price to the assets acquired and liabilities assumed based on their fair values. In estimating fair value of tangible and intangible assets acquired, the Company assesses and considers fair value based on estimated cash flow projections that utilize appropriate discount and capitalization rates, estimates of replacement costs, net of depreciation, and available market information. The fair value of the tangible assets of an acquired property considers the value of the property as if it were vacant. The Company records acquired above-market and below-market lease values initially based on the present value, using a discount rate which reflects the risks associated with the leases acquired based on the difference between (i) the contractual amounts to be paid pursuant to each in-place lease and (ii) management’s estimate of fair market lease rates for each corresponding in-place lease, measured over a period equal to the remaining term of the lease for above-market leases and the initial term plus the term of any below-market fixed renewal options for the below-market leases. Other intangible assets acquired include amounts for in-place lease values and tenant relationship values (if any) that are based on management’s evaluation of the specific characteristics of each tenant’s lease and the Company’s overall relationship with the respective tenant. Factors to be considered by management in its analysis of in-place lease values include an estimate of carrying costs to execute similar leases. In estimating carrying costs, management includes real estate taxes, insurance and other operating expenses and estimates of lost rentals at market rates during the expected lease-up periods, depending on local market conditions. In estimating costs to execute similar leases, management considers leasing commissions, legal and other related expenses. The Company reviews long-lived assets for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. A property’s value is impaired if management’s estimate of the aggregate future cash flows (undiscounted and without interest charges) to be generated by the property is less than the carrying value of the property. To the extent impairment has occurred, a write-down is recorded and measured by the amount of the difference between the carrying value of the asset and the fair value of the asset. In the event that the Company obtains proceeds through an insurance policy due to impairment, the proceeds are offset against the write-down in calculating gain/loss on disposal of assets. Management of the Company does not believe that any of its properties within the portfolio are impaired as of June 30, 2023. For long-lived assets to be disposed of, impairment losses are recognized when the fair value of the assets less estimated cost to sell is less than the carrying value of the assets. Properties classified as real estate held-for-sale generally represent properties that are actively marketed or contracted for sale with closing expected to occur within the next twelve months. Real estate held-for-sale is carried at the lower of cost, net of accumulated depreciation, or fair value less cost to sell, determined on an asset-by-asset basis. Expenditures for ordinary repair and maintenance costs on held-for-sale properties are charged to expense as incurred. Expenditures for improvements, renovations and replacements related to held-for-sale properties are capitalized at cost. Depreciation is not recorded on real estate held-for-sale. If a tenant vacates its space prior to the contractual termination of the lease and no rental payments are being made on the lease, any unamortized balances of the related intangibles are written off. The tenant improvements and origination costs are amortized to expense over the remaining life of the lease (or charged against earnings if the lease is terminated prior to its contractual expiration date). Depreciation is computed using the straight-line method over the estimated useful lives of the assets as follows: Building and improvements (in years) 10 – 44 Tenant improvements Shorter of useful life or lease term Furniture, fixtures and equipment (in years) 3 – 15 The capitalized above-market lease values are amortized as a reduction to base rental revenue over the remaining terms of the respective leases, and the capitalized below-market lease values are amortized as an increase to base rental revenue over the remaining initial terms plus the terms of any below-market fixed rate renewal options of the respective leases. The value of in-place leases is amortized to expense over the remaining initial terms of the respective leases. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and Cash Equivalents Cash and cash equivalents are defined as cash on hand and in banks, plus all short-term investments with a maturity of three months or less when purchased. The Company maintains some of its cash in bank deposit accounts, which, at times, may exceed the federally insured limit. No losses have been experienced related to such accounts. |
Cash and Cash Equivalents, Restricted Cash and Cash Equivalents, Policy [Policy Text Block] | Restricted Cash Restricted cash generally consists of escrows for future real estate taxes and insurance expenditures, repairs, capital improvements, loan reserves and security deposits. |
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy [Policy Text Block] | Tenant and Other Receivables and Allowance for Doubtful Accounts Tenant and other receivables are comprised of amounts due for monthly rents and other charges less allowance for doubtful accounts. As described more fully under Revenue Recognition |
Deferred Charges, Policy [Policy Text Block] | Deferred Costs Deferred lease costs consist of fees incurred to initiate and renew operating leases. Lease costs are being amortized using the straight-line method over the terms of the respective leases. Deferred financing costs represent commitment fees, legal and other third-party costs associated with obtaining financing. These costs are amortized over the term of the financing and are recorded in interest expense in the consolidated statements of operations. Unamortized deferred financing costs are expensed when the associated debt is refinanced or repaid before maturity. Costs incurred in seeking financing transactions which do not close are expensed in the period the financing transaction is terminated. |
Comprehensive Income, Policy [Policy Text Block] | Comprehensive Income (Loss) Comprehensive income (loss) is comprised of net income (loss) adjusted for changes in unrealized gains and losses, reported in equity, for financial instruments required to be reported at fair value under GAAP. For the three and six months ended June 30, 2023 and 2022, the Company did not own any financial instruments for which the change in value was not reported in net income (loss); accordingly, its comprehensive income (loss) was its net income (loss) as presented in the consolidated statements of operations. |
Revenue [Policy Text Block] | Revenue Recognition As mentioned above under Tenant and Other Receivables and Allowance for Doubtful Accounts, effective the first quarter of 2022, the Company has adopted ASC 842, “Leases” which replaces the guidance under ASC 840. ASC 842 applies to the Company principally as lessor; as a lessee, the Company’s leases are immaterial. The Company has determined that all its leases as lessor are operating leases. The Company has elected to not bifurcate lease and non-lease components under a practical expedient provision. With respect to collectability, beginning the first quarter of 2022, the Company has written off all receivables not probable of collection and related deferred rent, and has recorded income for those tenants on a cash basis. When the probability assessment has changed for these receivables, the Company has recognized lease income to the extent of the difference between the lease income that would have been recognized if collectability had always been assessed as probable and the lease income recognized to date. For remaining receivables probable of collection, the Company has recorded a general reserve under ASC 450. In the three and six months ended June 30, 2023 the Company has charged revenue in the amount of $0.9 million and $2.4 million, respectively for residential receivables not deemed probable of collection and recognized revenue of $0.4 million and $1.1 million respectively, for a reassessment of collectability of residential receivables previously not deemed probable of collection. In the three and six months ended June 30, 2022, the Company has charged revenue in the amount of $2.0 million and $3.4 million, respectively, for residential receivables not deemed probable of collection. and recognized revenue of $1.4 million and $2.1 million respectively, for a reassessment of collectability of residential receivables previously not deemed probable of collection. Additionally, during the six-months ended June 30, 2022 the Company recognized a net $1.1 million for a reassessment of collectability of one commercial tenant at Tribeca House that was determined to be probable of collection. In transitioning to ASC 842 in the first quarter of 2022, the Company elected the modified retrospective approach to existing leases at the beginning of the quarter and has recorded a cumulative-effect adjustment in retained earnings using the above methods applied to balances as of December 31, 2021, of $6.0 million. In accordance with the provisions of ASC 842, rental revenue for commercial leases is recognized on a straight-line basis over the terms of the respective leases. Deferred rents receivable represents the amount by which straight-line rental revenue exceeds rents currently billed in accordance with lease agreements. Rental income attributable to residential leases and parking is recognized as earned, which is not materially different from the straight-line basis. Leases entered by residents for apartment units are generally for one-year terms, renewable upon consent of both parties on an annual or monthly basis. Reimbursements for operating expenses due from tenants pursuant to their lease agreements are recognized as revenue in the period the applicable expenses are incurred. These costs generally include real estate taxes, utilities, insurance, common area maintenance costs and other recoverable costs and are recorded as part of commercial rental income in the condensed consolidated statements of operations. |
Share-Based Payment Arrangement [Policy Text Block] | Stock-based Compensation The Company accounts for stock-based compensation pursuant to Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, “Compensation — Stock Compensation.” As such, all equity-based awards are reflected as compensation expense in the Company’s consolidated statements of operations over their vesting period based on the fair value at the date of grant. In the event of a forfeiture, the previously recognized expense would be reversed. As of June 30, 2023, and December 31, 2022, there were 3,382,465 and 2,949,823 long-term incentive plan (“LTIP”) units outstanding, respectively, with a weighted average grant date fair value of $8.80 and $9.26 per unit, respectively. As of June 30, 2023, and December 31, 2022, there was $11.2 million and $10.2 million, respectively, of total unrecognized compensation cost related to unvested share-based compensation arrangements granted under share incentive plans. As of June 30, 2023, the weighted-average period over which the unrecognized compensation expense will be recorded is approximately four In March 2023, the Company granted employees and non-employee directors 274,911 and 157,731 LTIP units, respectively, with a weighted-average grant date value of $5.62 per unit. The grants vesting period range from up to one In April 2022, the Company granted employees and non-employee directors 900,000 and 275,000 LTIP units, respectively, with a weighted-average grant date value of $8.70 per unit, substantially all which vest in 10 years. Of these grants, 270,000 and 82,500 were approved by the shareholders of the Company at the 2022 Annual Meeting of the Shareholders on June 15, 2022 to increase the number of shares issuable under the Company’s 2015 Omnibus Incentive Plan and the 2015 Non-Employee Director Plan by 1.3 million and 0.5 million shares, respectively. |
Transaction Pursuit Costs, Policy [Policy Text Block] | Transaction Pursuit Costs Transaction pursuit costs primarily reflect costs incurred for abandoned acquisition, disposition or other transaction pursuits. During the three- and six-month periods ended June 30, 2023 Transaction pursuit costs include $357 of costs related to the Article 11 Agreement. During the three- and six-month periods ended June 30, 2022 the company incurred $92 and $516, respectively, primarily for an abandoned acquisition, as well as the acquisition of the Dean Street property. |
Income Tax, Policy [Policy Text Block] | Income Taxes The Company elected to be taxed and to operate in a manner that will allow it to qualify as a REIT under the Code. To qualify as a REIT, the Company is required to distribute dividends equal to at least 90% of the REIT taxable income (computed without regard to the dividends paid deduction and net capital gains) to its stockholders, and meet the various other requirements imposed by the Code relating to matters such as operating results, asset holdings, distribution levels and diversity of stock ownership. Provided the Company qualifies for taxation as a REIT, it is generally not subject to U.S. federal corporate-level income tax on the earnings distributed currently to its stockholders. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to U.S. federal and state income tax on its taxable income at regular corporate tax rates and any applicable alternative minimum tax. In addition, the Company may not be able to re-elect as a REIT for the four subsequent taxable years. The entities comprising the Predecessor are limited liability companies and are treated as pass-through entities for income tax purposes. Accordingly, no In accordance with FASB ASC Topic 740, the Company believes that it has appropriate support for the income tax positions taken and, as such, does not have any uncertain tax positions that, if successfully challenged, could result in a material impact on its financial position or results of operations. The prior three years’ income tax returns are subject to review by the Internal Revenue Service. |
Fair Value of Financial Instruments, Policy [Policy Text Block] | Fair Value Measurements Refer to Note 7, “Fair Value of Financial Instruments”. |
Derivatives, Policy [Policy Text Block] | Derivative Financial Instruments FASB derivative and hedging guidance establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts, and for hedging activities. As required by FASB guidance, the Company records all derivatives on the consolidated balance sheets at fair value. The accounting for changes in the fair value of derivatives depends on the intended use of the derivative and the resulting designation. Derivatives used to hedge the exposure to changes in the fair value of an asset, liability, or firm commitment attributable to a particular risk, such as interest rate risk, are considered fair value hedges. Derivatives used to hedge the exposure to variability in expected future cash flows, or other types of forecast transactions, are considered cash flow hedges. For derivatives designated as fair value hedges, changes in the fair value of the derivative and the hedged item related to the hedged risk are recognized in earnings. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is initially reported in other comprehensive income (loss) (outside of earnings) and subsequently reclassified to earnings when the hedged transaction affects earnings, and the ineffective portion of changes in the fair value of the derivative is recognized directly in earnings. The Company assesses the effectiveness of each hedging relationship by comparing the changes in the fair value or cash flows of the derivative hedging instrument with the changes in the fair value or cash flows of the designated hedged item or transaction. For derivatives not designated as hedges, changes in fair value would be recognized in earnings. As of June 30, 2023, the Company has no derivatives for which it applies hedge accounting. |
Earnings Per Share, Policy [Policy Text Block] | Loss Per Share Basic and diluted net loss per share is computed by dividing net loss attributable to common stockholders by the weighted average common shares outstanding. As of June 30, 2023 and 2022, the Company had unvested LTIP units which provide for non-forfeitable rights to dividend-equivalent payments. Accordingly, these unvested LTIP units are considered participating securities and are included in the computation of basic and diluted net loss per share pursuant to the two-class method. The Company did not The effect of the conversion of the 26,317 Class B LLC units outstanding is not reflected in the computation of basic and diluted net loss per share, as the effect would be anti-dilutive. The net loss allocable to such units is reflected as non-controlling interests in the accompanying consolidated financial statements. The following table sets forth the computation of basic and diluted net loss per share for the periods indicated (unaudited): Three Months Ended June 30, Six Months Ended June 30, (in thousands, except per share amounts) 2023 2022 2023 2022 Numerator Net loss attributable to common stockholders $ (1,249 ) $ (1,119 ) $ (3,936 ) $ (2,437 ) Less: income attributable to participating securities (322 ) (246 ) (644 ) (408 ) Subtotal $ (1,571 ) $ (1,365 ) $ (4,580 ) $ (2,845 ) Denominator Weighted-average common shares outstanding 16,063 16,063 16,063 16,063 Basic and diluted net loss per share attributable to common stockholders $ (0.10 ) $ (0.08 ) $ (0.29 ) $ (0.18 ) |
New Accounting Pronouncements, Policy [Policy Text Block] | Recently Issued Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (Topic 326), Measurement of Credit Losses on Financial Instruments. This ASU requires entities to estimate a lifetime expected credit loss for most financial assets, including trade and other receivables and other long term financings including available for sale and held-to-maturity debt securities, and loans. Subsequently, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which amends the scope of ASU 2016-13 and clarified that receivables arising from operating leases are not within the scope of the standard and should continue to be accounted for in accordance with the leases standard (Topic 842). As a result, the adoption of the standard as of January 1, 2022 did not have a material impact on the consolidated financial statements. In March 2020, FASB issued ASU 2020-04, “Reference Rate Reform: Facilitation of the Effects of Reference Rate Reform on Financial Reporting” (Topic 848). ASU 2020-04 provides temporary optional expedients and exceptions to ease financial reporting burdens related to applying current GAAP to modifications of contracts, hedging relationships and other transactions in connection with the transition from the London Interbank Offered Rate (“LIBOR”) and other interbank offered rates to alternative reference rates. ASU 2020-04 is effective beginning on March 12, 2020, and may be applied prospectively to such transactions through December 31, 2022. We will apply ASU 2020-04 prospectively as and when we enter transactions to which this guidance applies. In January 2021, FASB issued ASU 2021-01, “Reference Rate Reform” (Topic 848). ASU 2021-01 modifies ASC 848 (ASU 2020-04), which was intended to provide relief related to “contracts and transactions that reference LIBOR or a reference rate that is expected to be discontinued as a result of reference rate reform.” ASU 2021-01 expands the scope of ASC 848 to include all affected derivatives and give reporting entities the ability to apply certain aspects of the contract modification and hedge accounting expedients to derivative contracts affected by the discounting transition. ASU 2021-01 also adds implementation guidance to clarify which optional expedients in ASC 848 may be applied to derivative instruments that do not reference LIBOR or a reference rate that is expected to be discontinued, but that are being modified as a result of the discounting transition. The Company does not expect the adoption of ASU 2021-01 to have a material impact on its consolidated financial statements. |
Note 2 - Significant Accounti_2
Note 2 - Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Property, Plant and Equipment, Useful Life [Table Text Block] | Building and improvements (in years) 10 – 44 Tenant improvements Shorter of useful life or lease term Furniture, fixtures and equipment (in years) 3 – 15 |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | Three Months Ended June 30, Six Months Ended June 30, (in thousands, except per share amounts) 2023 2022 2023 2022 Numerator Net loss attributable to common stockholders $ (1,249 ) $ (1,119 ) $ (3,936 ) $ (2,437 ) Less: income attributable to participating securities (322 ) (246 ) (644 ) (408 ) Subtotal $ (1,571 ) $ (1,365 ) $ (4,580 ) $ (2,845 ) Denominator Weighted-average common shares outstanding 16,063 16,063 16,063 16,063 Basic and diluted net loss per share attributable to common stockholders $ (0.10 ) $ (0.08 ) $ (0.29 ) $ (0.18 ) |
Note 4 - Deferred Costs and I_2
Note 4 - Deferred Costs and Intangible Assets (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Schedule of Deferred Costs and Intangible Assets [Table Text Block] | June 30, 2023 December 31, 2022 (unaudited) Deferred costs $ 348 $ 348 Lease origination costs 1,463 1,376 In-place leases 428 428 Real estate tax abatements 9,142 9,142 Total deferred costs and intangible assets 11,381 11,294 Less accumulated amortization (4,963 ) (4,670 ) Total deferred costs and intangible assets, net $ 6,418 $ 6,624 |
Schedule of Deferred Costs and Intangible Assets, Future Amortization Expense [Table Text Block] | 2023 (Remainder) $ 305 2024 587 2025 570 2026 546 2027 534 Thereafter 3,876 Total $ 6,418 |
Note 5 - Notes Payable (Tables)
Note 5 - Notes Payable (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Schedule of Long-Term Debt Instruments [Table Text Block] | Property Maturity Interest Rate June 30, 2023 December 31, 2022 Flatbush Gardens, Brooklyn, NY (a) 6/1/2032 3.125% $ 329,000 $ 329,000 250 Livingston Street, Brooklyn, NY (b) 6/6/2029 3.63% 125,000 125,000 141 Livingston Street, Brooklyn, NY (c) 3/6/2031 3.21% 100,000 100,000 Tribeca House, Manhattan, NY (d) 3/6/2028 4.506% 360,000 360,000 Aspen, Manhattan, NY (e) 7/1/2028 3.68% 61,783 62,554 Clover House, Brooklyn, NY (f) 12/1/2029 3.53% 82,000 82,000 10 West 65 th 11/1/2027 SOFR + 2.50% 31,991 32,222 1010 Pacific Street, Brooklyn, NY (h) 9/1/2024 LIBOR + 3.60% — 43,477 1010 Pacific Street, Brooklyn, NY (h) 2/9/2028 5.55% 60,000 — Dean Street, Brooklyn, NY (i) 9/22/2023 Prime + 1.60% 36,985 36,985 Total debt $ 1,186,759 $ 1,171,238 Unamortized debt issuance costs (9,803 ) (9,650 ) Total debt, net of unamortized debt issuance costs $ 1,176,956 $ 1,161,588 |
Schedule of Maturities of Long-Term Debt [Table Text Block] | 2023 (Remainder) $ 37,956 2024 2,009 2025 2,803 2026 3,000 2027 34,215 Thereafter 1,106,776 Total $ 1,186,759 |
Note 6 - Rental Income Under _2
Note 6 - Rental Income Under Operating Leases (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Lessor, Operating Lease, Payment to be Received, Maturity [Table Text Block] | 2023 (Remainder) $ 15,166 2024 30,457 2025 24,822 2026 4,548 2027 3,915 Thereafter 19,315 Total $ 98,223 |
Note 7 - Fair Value of Financ_2
Note 7 - Fair Value of Financial Instruments (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Fair Value, by Balance Sheet Grouping [Table Text Block] | June 30, 2023 December 31, 2022 (unaudited) Carrying amount (excluding unamortized debt issuance costs) $ 1,186,759 $ 1,171,238 Estimated fair value $ 1,078,697 $ 1,092,345 |
Note 8 - Commitments and Cont_2
Note 8 - Commitments and Contingencies (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Schedules of Concentration of Risk, by Risk Factor [Table Text Block] | Commercial Residential Total Three months ended June 30, 2023 28 % 72 % 100 % Three months ended June 30, 2022 29 % 71 % 100 % Six months ended June 30, 2023 28 % 72 % 100 % Six months ended June 30, 2022 31 % 69 % 100 % |
Note 10 - Segment Reporting (Ta
Note 10 - Segment Reporting (Tables) | 6 Months Ended |
Jun. 30, 2023 | |
Notes Tables | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | Three months ended June 30, 2023 Commercial Residential Total Rental income $ 9,503 $ 25,040 $ 34,543 Total revenues $ 9,503 $ 25,040 $ 34,543 Property operating expenses 1,048 5,734 6,782 Real estate taxes and insurance 2,280 6,420 8,700 General and administrative 615 2,781 3,396 Transaction pursuit costs — 357 357 Depreciation and amortization 1,447 5,822 7,269 Total operating expenses 5,390 21,114 26,504 Income from operations $ 4,113 $ 3,926 $ 8,039 Three months ended June 30, 2022 Commercial Residential Total Rental income $ 9,290 $ 22,597 $ 31,887 Total revenues $ 9,290 $ 22,597 $ 31,887 Property operating expenses 1,184 5,744 6,928 Real estate taxes and insurance 2,016 5,870 7,886 General and administrative 624 2,573 3,197 Transaction pursuit costs 3 89 92 Depreciation and amortization 1,366 5,366 6,732 Total operating expenses 5,193 19,642 24,835 Income from operations 4,097 2,955 7,052 Six months ended June 30, 2023 Commercial Residential Total Rental income $ 19,230 $ 48,980 $ 68,210 Total revenues 19,230 48,980 68,210 Property operating expenses 2,263 12,618 14,881 Real estate taxes and insurance 4,529 12,707 17,236 General and administrative 1,186 5,503 6,689 Transaction pursuit costs — 357 357 Depreciation and amortization 2,889 11,205 14,094 Total operating expenses 10,867 42,390 53,257 Income from operations $ 8,363 $ 6,590 $ 14,953 Six months ended June 30, 2022 Commercial Residential Total Rental income $ 19,878 $ 44,059 $ 63,937 Total revenues 19,878 44,059 63,937 Property operating expenses 2,327 12,140 14,467 Real estate taxes and insurance 4,036 11,781 15,817 General and administrative 1,147 4,992 6,139 Transaction pursuit costs 81 435 516 Depreciation and amortization 2,722 10,715 13,437 Total operating expenses 10,313 40,063 50,376 Income from operations $ 9,565 $ 3,996 $ 13,561 Commercial Residential Total June 30, 2023 (unaudited) $ 311,193 $ 914,626 $ 1,225,819 December 31, 2022 312,404 917,227 1,229,631 Commercial Residential Total Three months ended June 30, 2023 $ 2,547 $ 8,787 $ 11,334 2022 $ 2,511 $ 7,494 $ 10,005 Six months ended June 30, 2023 $ 5,007 $ 16,462 $ 21,469 2022 $ 5,004 $ 14,986 $ 19,990 Commercial Residential Total Three months ended June 30, 2023 $ 563 $ 5,858 $ 6,421 2022 $ 838 $ 15,332 $ 16,170 Six months ended June 30, 2023 $ 2,240 $ 15,347 $ 17,587 2022 $ 1,628 $ 30,976 $ 32,604 |
Note 1 - Organization (Details
Note 1 - Organization (Details Textual) $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | ||||||
Aug. 31, 2022 USD ($) | Apr. 30, 2022 USD ($) | Feb. 28, 2022 USD ($) | Jun. 30, 2023 USD ($) ft² | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) ft² | Jun. 30, 2022 USD ($) | Jun. 29, 2023 | Dec. 31, 2019 | |
Payments to Acquire Real Estate | $ | $ 18,915 | $ 24,851 | |||||||
Percentage of Aggregate Cash Distributions From, and Profits and Losses | 37.90% | 37.90% | |||||||
Corporate Joint Venture [Member] | |||||||||
Joint Venture, Ownership Percentage | 50% | ||||||||
Corporate Joint Venture [Member] | General and Administrative Expense [Member] | |||||||||
Joint Venture Expense | $ | $ 0 | $ 90 | $ 0 | $ 110 | |||||
Land [Member] | |||||||||
Payments to Acquire Real Estate | $ | $ 2,500 | $ 4,300 | $ 3,700 | ||||||
Tribeca House properties in Manhattan [Member] | |||||||||
Number of Buildings | 2 | 2 | |||||||
Tribeca House properties in Manhattan [Member] | Residential Rental [Member] | |||||||||
Gross Leasable Area (Square Foot) | 483,000 | 483,000 | |||||||
Tribeca House properties in Manhattan, Building One [Member] | |||||||||
Number of Stories | 21 | 21 | |||||||
Tribeca House properties in Manhattan, Building One [Member] | Rental Retail and Parking [Member] | |||||||||
Gross Leasable Area (Square Foot) | 77,000 | 77,000 | |||||||
Tribeca House properties in Manhattan, Building Two [Member] | |||||||||
Number of Stories | 12 | 12 | |||||||
Flatbush Gardens, Brooklyn, NY [Member] | Multifamily [Member] | |||||||||
Number of Buildings | 59 | 59 | |||||||
Gross Leasable Area (Square Foot) | 1,749,000 | 1,749,000 | |||||||
Number of Rentable Units | 2,494 | 2,494 | |||||||
Number of Units Committed to Rent to Formerly Homeless | 249 | ||||||||
141 Livingston Street in Brooklyn [Member] | Office Building [Member] | |||||||||
Number of Stories | 15 | 15 | |||||||
Gross Leasable Area (Square Foot) | 216,000 | 216,000 | |||||||
250 Livingston Street in Brooklyn [Member] | Office and Residential Building [Member] | |||||||||
Number of Stories | 12 | 12 | |||||||
Gross Leasable Area (Square Foot) | 370,000 | 370,000 | |||||||
Aspen [Member] | |||||||||
Number of Stories | 7 | 7 | |||||||
Aspen [Member] | Residential Rental [Member] | |||||||||
Gross Leasable Area (Square Foot) | 166,000 | 166,000 | |||||||
Aspen [Member] | Retail Site [Member] | |||||||||
Gross Leasable Area (Square Foot) | 21,000 | 21,000 | |||||||
Clover House [Member] | |||||||||
Number of Stories | 11 | 11 | |||||||
Clover House [Member] | Apartment Building [Member] | |||||||||
Gross Leasable Area (Square Foot) | 102,000 | 102,000 | |||||||
Residential Property At 10 West 65th Street [Member] | Residential Rental [Member] | |||||||||
Number of Stories | 6 | 6 | |||||||
Gross Leasable Area (Square Foot) | 76,000 | 76,000 | |||||||
Residential Property At 1010 Pacific Street [Member] | Residential Rental [Member] | |||||||||
Number of Stories | 9 | 9 | |||||||
Gross Leasable Area (Square Foot) | 119,000 | 119,000 | |||||||
Dean Street, Prospect Heights [Member] | Residential Rental [Member] | |||||||||
Number of Stories | 9 | 9 | |||||||
Gross Leasable Area (Square Foot) | 160,000 | 160,000 | |||||||
Dean Street, Prospect Heights [Member] | Retail Site [Member] | |||||||||
Gross Leasable Area (Square Foot) | 9,000 | 9,000 |
Note 2 - Significant Accounti_3
Note 2 - Significant Accounting Policies (Details Textual) $ / shares in Units, $ in Thousands | 1 Months Ended | 3 Months Ended | 6 Months Ended | |||||||
Mar. 31, 2023 USD ($) $ / shares shares | Apr. 30, 2022 $ / shares shares | Jun. 30, 2023 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) $ / shares shares | Jun. 30, 2022 USD ($) shares | Dec. 31, 2022 USD ($) $ / shares shares | Mar. 31, 2022 USD ($) | Jan. 01, 2022 USD ($) | Dec. 31, 2021 USD ($) | |
Number of Operating Segments | 2 | |||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance | $ 26,390 | $ 19,530 | $ 50,222 | $ 19,530 | $ 50,222 | $ 37,179 | $ 56,734 | $ 69,949 | ||
Retained Earnings (Accumulated Deficit) | (81,883) | (81,883) | (74,895) | |||||||
Share-Based Payment Arrangement, Nonvested Award, Excluding Option, Cost Not yet Recognized, Amount | $ 11,200 | $ 11,200 | $ 10,200 | |||||||
Share-Based Payment Arrangement, Nonvested Award, Cost Not yet Recognized, Period for Recognition | 4 years | |||||||||
Percent of Distributed Dividends Equal to Taxable REIT Income | 90% | 90% | ||||||||
Income Tax Expense (Benefit), Total | $ 0 | |||||||||
Weighted Average Number of Shares Outstanding, Diluted, Adjustment, Total (in shares) | shares | 0 | 0 | ||||||||
Class B LLC Units [Member] | ||||||||||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | shares | 26,317 | |||||||||
Abandoned Acquisition and Dean Street Property [Member] | ||||||||||
Transaction Pursuit Costs, Total | 92 | $ 516 | ||||||||
Multifamily [Member] | Flatbush Gardens, Brooklyn, NY [Member] | ||||||||||
Transaction Pursuit Costs, Total | $ 357 | $ 357 | ||||||||
LTIP Units [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Number | shares | 3,382,465 | 3,382,465 | 2,949,823 | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value | $ / shares | $ 8.80 | $ 8.80 | $ 9.26 | |||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ / shares | $ 8.70 | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period | 10 years | |||||||||
LTIP Units [Member] | The 2015 Omnibus Incentive Plan [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Additional Shares Authorized, Subject to Approval | shares | 1,300,000 | |||||||||
LTIP Units [Member] | The 2015 Non-Employee Director Plan [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Number of Additional Shares Authorized, Subject to Approval | shares | 500,000 | |||||||||
LTIP Units [Member] | Share-Based Payment Arrangement, Employee [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period | shares | 900,000 | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Subject to Approval | shares | 270,000 | |||||||||
LTIP Units [Member] | Share-Based Payment Arrangement, Nonemployee [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period | shares | 275,000 | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Subject to Approval | shares | 82,500 | |||||||||
LTIP Units [Member] | Employees [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period | shares | 274,911 | |||||||||
LTIP Units [Member] | Employees [Member] | Minimum [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period | 1 year | |||||||||
LTIP Units [Member] | Employees [Member] | Maximum [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period | 2 years 6 months | |||||||||
LTIP Units [Member] | Non-employee Director [Member] | ||||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period | shares | 157,731 | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Equity Instruments Other than Options, Grants in Period, Weighted Average Grant Date Fair Value | $ / shares | $ 5.62 | |||||||||
Share-Based Compensation Arrangement by Share-Based Payment Award, Award Vesting Period | 1 year | |||||||||
Collectability of Lease Receivables [Member] | ||||||||||
Loss Contingency, Loss in Period | $ 900 | 2,000 | $ 2,400 | 3,400 | ||||||
Revenues | $ 400 | $ 1,400 | $ 1,100 | 2,100 | ||||||
Collectability of Lease Receivables [Member] | One Customer at Tribeca House [Member] | ||||||||||
Revenues | $ 1,100 | |||||||||
Cumulative Effect, Period of Adoption, Adjustment [Member] | ||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance | (6,046) | |||||||||
Retained Earnings (Accumulated Deficit) | $ 6,000 | |||||||||
Cumulative Effect, Period of Adoption, Adjustment [Member] | Accounting Standards Update 2016-02 [Member] | ||||||||||
Stockholders' Equity, Including Portion Attributable to Noncontrolling Interest, Ending Balance | $ (6,000) |
Note 2 - Significant Accounti_4
Note 2 - Significant Accounting Policies - Estimated Useful Lives of Assets (Details) | Jun. 30, 2023 |
Building and Building Improvements [Member] | Minimum [Member] | |
Property, plant and equipment useful life (Year) | 10 years |
Building and Building Improvements [Member] | Maximum [Member] | |
Property, plant and equipment useful life (Year) | 44 years |
Furniture, Fixtures and Equipment [Member] | Minimum [Member] | |
Property, plant and equipment useful life (Year) | 3 years |
Furniture, Fixtures and Equipment [Member] | Maximum [Member] | |
Property, plant and equipment useful life (Year) | 15 years |
Note 2 - Significant Accounti_5
Note 2 - Significant Accounting Policies - Basic and Diluted Earnings (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Net loss attributable to common stockholders | $ (1,249) | $ (1,119) | $ (3,936) | $ (2,437) |
Less: income attributable to participating securities | 322 | 246 | 644 | 408 |
Subtotal | $ (1,571) | $ (1,365) | $ (4,580) | $ (2,845) |
Weighted-average common shares outstanding (in shares) | 16,063 | 16,063 | 16,063 | 16,063 |
Basic and diluted net loss per share attributable to common stockholders (in dollars per share) | $ (0.10) | $ (0.08) | $ (0.29) | $ (0.18) |
Note 3 - Acquisitions (Details
Note 3 - Acquisitions (Details Textual) - Residential Property At 1010 Pacific Street [Member] $ in Thousands | 6 Months Ended |
Jun. 30, 2022 USD ($) | |
Business Combination, Consideration Transferred | $ 3,701 |
Business Combination, Acquisition Related Costs | $ 151 |
Note 4 - Deferred Costs and I_3
Note 4 - Deferred Costs and Intangible Assets (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Amortization of Lease Origination Costs and In-place Lease Intangible Assets | $ 26 | $ 60 | $ 51 | $ 119 |
Amortization of Real Estate Abatements | $ 120 | $ 121 | $ 241 | $ 241 |
Note 4 - Deferred Costs and I_4
Note 4 - Deferred Costs and Intangible Assets - Deferred Costs and Intangible Assets (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Deferred costs | $ 348 | $ 348 |
Lease origination costs | 1,463 | 1,376 |
In-place leases | 428 | 428 |
Real estate tax abatements | 9,142 | 9,142 |
Total deferred costs and intangible assets | 11,381 | 11,294 |
Less accumulated amortization | (4,963) | (4,670) |
Total deferred costs and intangible assets, net | $ 6,418 | $ 6,624 |
Note 4 - Deferred Costs and I_5
Note 4 - Deferred Costs and Intangible Assets - Future Amortization Expense (Details) - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
2023 (Remainder) | $ 305 | |
2024 | 587 | |
2025 | 570 | |
2026 | 546 | |
2027 | 534 | |
Thereafter | 3,876 | |
Total deferred costs and intangible assets, net | $ 6,418 | $ 6,624 |
Note 5 - Notes Payable (Details
Note 5 - Notes Payable (Details Textual) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 5 Months Ended | 6 Months Ended | 60 Months Ended | 132 Months Ended | ||||||||||||||||
Feb. 09, 2023 | Dec. 22, 2021 | Aug. 10, 2021 | Feb. 18, 2021 | May 08, 2020 | Dec. 24, 2019 | May 31, 2019 | Apr. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2023 | Jun. 30, 2022 | Nov. 01, 2027 | Jul. 31, 2028 | Mar. 31, 2023 | Oct. 31, 2022 | Aug. 26, 2022 | Jun. 30, 2021 | Nov. 08, 2019 | Feb. 21, 2018 | Jun. 27, 2016 | |
Long-Term Debt, Gross | $ 1,186,759 | $ 1,186,759 | $ 1,186,759 | |||||||||||||||||||
Gain (Loss) on Extinguishment of Debt | $ 0 | $ 0 | $ (3,868) | $ 0 | ||||||||||||||||||
New York Community Bank [Member] | Property at 10 W 65th St. Manhattan, NY [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 7.25% | |||||||||||||||||||||
Metlife Real Estate Lending LLC [Member] | Clover House Loans [Member] | ||||||||||||||||||||||
Long-Term Debt, Gross | $ 82,000 | |||||||||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 3.53% | |||||||||||||||||||||
Secured First Mortgage Loan [Member] | New York Community Bank [Member] | ||||||||||||||||||||||
Debt Instrument, Face Amount | $ 329,000 | |||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.125% | |||||||||||||||||||||
Secured First Mortgage Loan [Member] | New York Community Bank [Member] | Prime Rate [Member] | ||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.75% | |||||||||||||||||||||
First Mortgage Loan With Interest-only Payments [Member] | Citi Real Estate Funding Inc. [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.63% | |||||||||||||||||||||
Proceeds from Issuance of Long-Term Debt | $ 125,000 | |||||||||||||||||||||
Debt Instrument, Prepayment Option, Number of Months Before Maturity (Year) | 3 years | |||||||||||||||||||||
Secured First Mortgage Note [Member] | Citi Real Estate Funding Inc. [Member] | 141 Livingston Street, Brooklyn [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.21% | |||||||||||||||||||||
Proceeds from Issuance of Long-Term Debt | $ 100,000 | |||||||||||||||||||||
Gain (Loss) on Extinguishment of Debt | $ 3,868 | |||||||||||||||||||||
Fixed Interest Rate Financing [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 4.506% | |||||||||||||||||||||
Long-Term Debt, Gross | $ 360,000 | |||||||||||||||||||||
Mortgages [Member] | New York Community Bank [Member] | Property at 10 W 65th St. Manhattan, NY [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.375% | 2.50% | ||||||||||||||||||||
Long-Term Debt, Gross | $ 32,200 | |||||||||||||||||||||
Mortgages [Member] | New York Community Bank [Member] | Prime Rate [Member] | Property at 10 W 65th St. Manhattan, NY [Member] | Forecast [Member] | ||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 2.75% | |||||||||||||||||||||
Mortgages [Member] | Capital One Multifamily Finance LLC [Member] | Aspen [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 3.68% | |||||||||||||||||||||
Long-Term Debt, Gross | $ 70,000 | |||||||||||||||||||||
Mortgages [Member] | Capital One Multifamily Finance LLC [Member] | Aspen [Member] | Forecast [Member] | ||||||||||||||||||||||
Debt Instrument, Periodic Payment | $ 321 | |||||||||||||||||||||
Mortgages [Member] | Citibank NA [Member] | Residential Property At 1010 Pacific Street [Member] | ||||||||||||||||||||||
Long-Term Debt, Gross | $ 18,600 | |||||||||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 4.85% | |||||||||||||||||||||
Mortgages [Member] | Citibank NA [Member] | Residential Property At 1010 Pacific Street [Member] | Minimum [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 1.25% | |||||||||||||||||||||
Mortgages [Member] | Citibank NA [Member] | London Interbank Offered Rate (LIBOR) 1 [Member] | Residential Property At 1010 Pacific Street [Member] | ||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 3.60% | |||||||||||||||||||||
Mortgages [Member] | Bank Leumi, N.A [Member] | Dean Street, Prospect Heights [Member] | ||||||||||||||||||||||
Long-Term Debt, Gross | $ 30,000 | |||||||||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 9.85% | 9.85% | 9.85% | |||||||||||||||||||
Proceeds from Issuance of Debt | $ 6,985 | |||||||||||||||||||||
Mortgages [Member] | Bank Leumi, N.A [Member] | Dean Street, Prospect Heights [Member] | Minimum [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 3.25% | |||||||||||||||||||||
Mortgages [Member] | Bank Leumi, N.A [Member] | Prime Rate [Member] | Dean Street, Prospect Heights [Member] | ||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 1.60% | |||||||||||||||||||||
Construction Loans [Member] | Citibank NA [Member] | Residential Property At 1010 Pacific Street [Member] | ||||||||||||||||||||||
Debt Agreement Maximum Borrowing Capacity | $ 2,987 | |||||||||||||||||||||
Mortgages 2 [Member] | AIG Asset Management[Member] | Residential Property At 1010 Pacific Street [Member] | ||||||||||||||||||||||
Debt Agreement Maximum Borrowing Capacity | $ 52,500 | |||||||||||||||||||||
Mortgages 2 [Member] | AIG Asset Management[Member] | Residential Property At 1010 Pacific Street [Member] | Minimum [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 4.10% | |||||||||||||||||||||
Mortgages 2 [Member] | AIG Asset Management[Member] | London Interbank Offered Rate [Member] | Residential Property At 1010 Pacific Street [Member] | ||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 3.60% | |||||||||||||||||||||
Mortgages 2 [Member] | Valley National Bank [Member] | Residential Property At 1010 Pacific Street [Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.70% | 5.55% | 5.55% | 5.55% | ||||||||||||||||||
Proceeds from Issuance of Long-Term Debt | $ 60,000 | |||||||||||||||||||||
Debt Agreement Maximum Borrowing Capacity | 80,000 | |||||||||||||||||||||
Debt Instrument, Contingent Funding. | $ 20,000 | |||||||||||||||||||||
Debt Instrument, Interest Rate, Increase (Decrease) | 15% | |||||||||||||||||||||
Mortgages 2 [Member] | Valley National Bank [Member] | Contingent Rate [member] | ||||||||||||||||||||||
Debt Instrument, Basis Spread on Variable Rate | 0.25% | |||||||||||||||||||||
Residential Property At 1010 Pacific Street [Member] | AIG Asset Management[Member] | ||||||||||||||||||||||
Debt Instrument, Interest Rate, Effective Percentage | 9.35% |
Note 5 - Notes Payable - Mortga
Note 5 - Notes Payable - Mortgages and Mezzanine Note Payable (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2023 | Dec. 31, 2022 | |
Debt, gross | $ 1,186,759 | |
Unamortized debt issuance costs | (9,803) | $ (9,650) |
Mortgages and Mezzanine Notes 1[Member] | ||
Debt, gross | 1,186,759 | 1,171,238 |
Unamortized debt issuance costs | (9,803) | (9,650) |
Total debt, net of unamortized debt issuance costs | $ 1,176,956 | 1,161,588 |
Mortgages and Mezzanine Notes 1[Member] | Flatbush Gardens, Brooklyn, NY [Member] | ||
Interest rate | 3.125% | |
Debt, gross | $ 329,000 | 329,000 |
Mortgages and Mezzanine Notes 1[Member] | 250 Livingston Street in Brooklyn [Member] | ||
Interest rate | 3.63% | |
Debt, gross | $ 125,000 | 125,000 |
Mortgages and Mezzanine Notes 1[Member] | 141 Livingston Street, Brooklyn [Member] | ||
Interest rate | 3.21% | |
Debt, gross | $ 100,000 | 100,000 |
Mortgages and Mezzanine Notes 1[Member] | Tribeca House Properties [Member] | ||
Interest rate | 4.506% | |
Debt, gross | $ 360,000 | 360,000 |
Mortgages and Mezzanine Notes 1[Member] | Aspen [Member] | ||
Interest rate | 3.68% | |
Debt, gross | $ 61,783 | 62,554 |
Mortgages and Mezzanine Notes 1[Member] | Clover House [Member] | ||
Interest rate | 3.53% | |
Debt, gross | $ 82,000 | 82,000 |
Mortgages and Mezzanine Notes 1[Member] | Property at 10 W 65th St. Manhattan, NY [Member] | ||
Debt, gross | $ 31,991 | 32,222 |
Mortgages and Mezzanine Notes 1[Member] | Property at 10 W 65th St. Manhattan, NY [Member] | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate [Member] | ||
Basis spread on variable rate | 2.50% | |
Mortgages and Mezzanine Notes 1[Member] | Residential Property At 1010 Pacific Street [Member] | ||
Debt, gross | $ 0 | 43,477 |
Mortgages and Mezzanine Notes 1[Member] | Residential Property At 1010 Pacific Street [Member] | London Interbank Offered Rate [Member] | ||
Basis spread on variable rate | 3.60% | |
Mortgages and Mezzanine Notes 1[Member] | Dean Street, Prospect Heights [Member] | ||
Debt, gross | $ 36,985 | 36,985 |
Mortgages and Mezzanine Notes 1[Member] | Dean Street, Prospect Heights [Member] | Prime Rate [Member] | ||
Basis spread on variable rate | 1.60% | |
Mortgages and Mezzanine Notes 2 [Member] | Residential Property At 1010 Pacific Street [Member] | ||
Interest rate | 5.55% | |
Debt, gross | $ 60,000 | $ 0 |
Note 5 - Notes Payable - Summar
Note 5 - Notes Payable - Summary of Principal Payment Requirements (Details) $ in Thousands | Jun. 30, 2023 USD ($) |
2023 (Remainder) | $ 37,956 |
2024 | 2,009 |
2025 | 2,803 |
2026 | 3,000 |
2027 | 34,215 |
Thereafter | 1,106,776 |
Total | $ 1,186,759 |
Note 6 - Rental Income Under _3
Note 6 - Rental Income Under Operating Leases (Details Textual) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Total Revenue [Member] | Customer Concentration Risk [Member] | City of New York [Member] | ||||
Concentration Risk, Percentage | 23% | 24% | 23% | 24% |
Note 6 - Rental Income Under _4
Note 6 - Rental Income Under Operating Leases - Minimum Future Cash Rents Receivable (Details) $ in Thousands | Jun. 30, 2023 USD ($) |
2023 (Remainder) | $ 15,166 |
2024 | 30,457 |
2025 | 24,822 |
2026 | 4,548 |
2027 | 3,915 |
Thereafter | 19,315 |
Total | $ 98,223 |
Note 7 - Fair Value of Financ_3
Note 7 - Fair Value of Financial Instruments - Carrying Amount and Fair Value of Mortgage Notes Payable (Details) - Mortgages [Member] - USD ($) $ in Thousands | Jun. 30, 2023 | Dec. 31, 2022 |
Reported Value Measurement [Member] | ||
Long-term debt | $ 1,186,759 | $ 1,171,238 |
Estimate of Fair Value Measurement [Member] | ||
Long-term debt | $ 1,078,697 | $ 1,092,345 |
Note 8 - Commitments and Cont_3
Note 8 - Commitments and Contingencies (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||||
Jun. 23, 2022 | May 09, 2022 | Dec. 31, 2021 | Dec. 31, 2022 | Jun. 30, 2023 | Jun. 29, 2023 | |
Litigation Settlement, Expense | $ 2,700 | |||||
Housing Repair and Maintenance Letter Agreement [Member] | ||||||
Other Commitment | $ 27,000 | |||||
Obligated to Provide Parking [Member] | ||||||
Other Commitment | $ 205 | |||||
The Kuzmich Case [Member] | ||||||
Litigation Settlement, Amount Awarded to Other Party | $ 1,200 | |||||
Litigation Settlement, Amount Awarded to Other Party, Attorney Fee's | $ 400 | |||||
Horn v 50 Murray Street Acquisition LLC, Index No.152415/21 [Member] | ||||||
Loss Contingency Accrual, Payments | $ 2,300 | |||||
Loss Contingency Accrual | $ 400 |
Note 8 - Commitments and Cont_4
Note 8 - Commitments and Contingencies - Summary of Concentration Risk by Segment (Details) - Total Revenue [Member] - Geographic Concentration Risk [Member] - New York City [Member] | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Concentration risk | 100% | 100% | 100% | 100% |
Commercial Segment [Member] | ||||
Concentration risk | 28% | 29% | 28% | 31% |
Residential Segment [Member] | ||||
Concentration risk | 72% | 71% | 72% | 69% |
Note 9 - Related-party Transa_2
Note 9 - Related-party Transactions (Details Textual) - General and Administrative Expense [Member] - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | |
Overhead Charged Related to Office Expenses [Member] | ||||
Related Party Transaction, Amounts of Transaction | $ 133 | $ 64 | $ 198 | $ 128 |
Reimbursable Payroll Expense [Member] | ||||
Related Party Transaction, Amounts of Transaction | $ (53) | $ (9) | $ (30) | $ (17) |
Note 10 - Segment Reporting - S
Note 10 - Segment Reporting - Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2023 | Jun. 30, 2022 | Jun. 30, 2023 | Jun. 30, 2022 | Dec. 31, 2022 | |
Rental income | $ 34,543 | $ 31,887 | $ 68,210 | $ 63,937 | |
Assets | 1,225,819 | 1,225,819 | $ 1,229,631 | ||
Interest expense | 11,334 | 10,005 | 21,469 | 19,990 | |
Capital expenditures | 6,421 | 16,170 | 17,587 | 32,604 | |
Property operating expenses | 6,782 | 6,928 | 14,881 | 14,467 | |
Real estate taxes and insurance | 8,700 | 7,886 | 17,236 | 15,817 | |
General and administrative | 3,396 | 3,197 | 6,689 | 6,139 | |
Transaction pursuit costs | 357 | 92 | 357 | 516 | |
Depreciation and amortization | 7,269 | 6,732 | 14,094 | 13,437 | |
Total operating expenses | 26,504 | 24,835 | 53,257 | 50,376 | |
Income from operations | 8,039 | 7,052 | 14,953 | 13,561 | |
Rental Income [Member] | |||||
Rental income | 34,543 | 31,887 | 68,210 | 63,937 | |
Commercial Segment [Member] | |||||
Rental income | 9,503 | 9,290 | 19,230 | 19,878 | |
Assets | 311,193 | 311,193 | 312,404 | ||
Interest expense | 2,547 | 2,511 | 5,007 | 5,004 | |
Capital expenditures | 563 | 838 | 2,240 | 1,628 | |
Property operating expenses | 1,048 | 1,184 | 2,263 | 2,327 | |
Real estate taxes and insurance | 2,280 | 2,016 | 4,529 | 4,036 | |
General and administrative | 615 | 624 | 1,186 | 1,147 | |
Transaction pursuit costs | 0 | 3 | 0 | 81 | |
Depreciation and amortization | 1,447 | 1,366 | 2,889 | 2,722 | |
Total operating expenses | 5,390 | 5,193 | 10,867 | 10,313 | |
Income from operations | 4,113 | 4,097 | 8,363 | 9,565 | |
Commercial Segment [Member] | Rental Income [Member] | |||||
Rental income | 9,503 | 9,290 | 19,230 | 19,878 | |
Residential Segment [Member] | |||||
Rental income | 25,040 | 22,597 | 48,980 | 44,059 | |
Assets | 914,626 | 914,626 | $ 917,227 | ||
Interest expense | 8,787 | 7,494 | 16,462 | 14,986 | |
Capital expenditures | 5,858 | 15,332 | 15,347 | 30,976 | |
Property operating expenses | 5,734 | 5,744 | 12,618 | 12,140 | |
Real estate taxes and insurance | 6,420 | 5,870 | 12,707 | 11,781 | |
General and administrative | 2,781 | 2,573 | 5,503 | 4,992 | |
Transaction pursuit costs | 357 | 89 | 357 | 435 | |
Depreciation and amortization | 5,822 | 5,366 | 11,205 | 10,715 | |
Total operating expenses | 21,114 | 19,642 | 42,390 | 40,063 | |
Income from operations | 3,926 | 2,955 | 6,590 | 3,996 | |
Residential Segment [Member] | Rental Income [Member] | |||||
Rental income | $ 25,040 | $ 22,597 | $ 48,980 | $ 44,059 |