Cover
Cover - shares | 9 Months Ended | |
Sep. 30, 2021 | Nov. 15, 2021 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Quarterly Report | true | |
Document Transition Report | false | |
Document Period End Date | Sep. 30, 2021 | |
Document Fiscal Period Focus | Q3 | |
Document Fiscal Year Focus | 2021 | |
Current Fiscal Year End Date | --12-31 | |
Entity File Number | 000-237507 | |
Entity Registrant Name | HARBOR CUSTOM DEVELOPMENT, INC. | |
Entity Central Index Key | 0001784567 | |
Entity Tax Identification Number | 46-4827436 | |
Entity Incorporation, State or Country Code | WA | |
Entity Address, Address Line One | 11505 Burnham Dr. | |
Entity Address, Address Line Two | Suite 301 | |
Entity Address, City or Town | Gig Harbor | |
Entity Address, State or Province | WA | |
Entity Address, Postal Zip Code | 98332 | |
City Area Code | (253) | |
Local Phone Number | 649-0636 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | true | |
Entity Ex Transition Period | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 14,922,094 | |
Common Stock [Member] | ||
Title of 12(b) Security | Common Stock | |
Trading Symbol | HCDI | |
Security Exchange Name | NASDAQ | |
8.0% Series A Cumulative Convertible Preferred Stock[Member] | ||
Title of 12(b) Security | 8.0% Series A Cumulative Convertible Preferred Stock | |
Trading Symbol | HCDIP | |
Security Exchange Name | NASDAQ | |
Warrant [Member] | ||
Title of 12(b) Security | Warrants | |
Trading Symbol | HCDIW | |
Security Exchange Name | NASDAQ | |
Warrant One [Member] | ||
Title of 12(b) Security | Warrants | |
Trading Symbol | HCDIZ | |
Security Exchange Name | NASDAQ |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
ASSETS | ||
Real Estate | $ 105,463,700 | $ 20,370,300 |
Property, Plant and Equipment, net | 9,132,900 | 8,176,000 |
Right of Use Assets | 788,400 | 873,800 |
Cash | 4,787,700 | 2,396,500 |
Restricted Cash | 597,600 | |
Prepaid Expense | 2,248,100 | 1,658,000 |
Accounts Receivable, net | 104,800 | 78,200 |
Contract Assets, net | 4,762,400 | |
Deferred Offering Costs | 133,400 | 65,100 |
TOTAL ASSETS | 128,019,000 | 33,617,900 |
LIABILITIES | ||
Construction Loans, net of Debt Discount of $878,600 and $502,400 respectively | 38,682,100 | 9,590,100 |
Construction Loans - Related Parties, net of Debt Discount of $1,416,300 and $670,200 respectively | 11,376,000 | 5,819,700 |
Equipment Loans | 5,731,800 | 5,595,500 |
Accounts Payable and Accrued Expenses | 5,875,800 | 2,700,000 |
Operating Lease Liabilities | 766,900 | 841,700 |
Finance Leases | 611,300 | 999,400 |
Deferred Revenue | 21,700 | 896,300 |
Note Payable PPP | 19,300 | |
Dividends Payable | 210,600 | |
Contract Liability | 390,900 | |
Note Payable D&O Insurance | 1,284,000 | 741,200 |
TOTAL LIABILITIES | 64,951,100 | 27,203,200 |
COMMITMENTS AND CONTINGENCIES - SEE NOTE 11 | ||
STOCKHOLDERS’ EQUITY | ||
Preferred Stock, No Par 10,000,000 shares authorized and 1,260,555 issued and outstanding at September 30, 2021 and 0 outstanding and issued at December 31, 2020 | 28,661,000 | |
Common Stock, No Par 50,000,000 shares authorized and 14,922,094 outstanding at September 30, 2021 and 5,636,548 issued and outstanding at December 31, 2020 | 37,057,900 | 11,956,900 |
Additional Paid In Capital | 668,900 | 234,800 |
Accumulated Deficit | (2,028,300) | (4,487,100) |
Total Stockholders’ Equity - Harbor Custom Development, Inc. | 64,359,500 | 7,704,600 |
Non-Controlling Interest | (1,291,600) | (1,289,900) |
TOTAL STOCKHOLDERS’ EQUITY | 63,067,900 | 6,414,700 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 128,019,000 | $ 33,617,900 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Statement of Financial Position [Abstract] | ||
Construction Loans, net of Debt Discount | $ 878,600 | $ 502,400 |
Construction Loans - Related Parties, net of Debt Discount | $ 1,416,300 | $ 670,200 |
Preferred stock, no par value | $ 0 | $ 0 |
Preferred stock, shares authorized | 10,000,000 | 10,000,000 |
Preferred stock, shares issued | 1,260,555 | 0 |
Preferred stock, shares outstanding | 1,260,555 | 0 |
Common stock, no par value | $ 0 | $ 0 |
Common stock, shares authorized | 50,000,000 | 50,000,000 |
Common stock, shares outstanding | 14,922,094 | 5,636,548 |
Common stock, shares issued | 14,922,094 | 5,636,548 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations (Unaudited) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Income Statement [Abstract] | ||||
Sales | $ 18,010,600 | $ 7,806,500 | $ 46,017,200 | $ 26,077,300 |
Cost of Sales | 10,866,200 | 7,183,900 | 34,938,300 | 24,448,100 |
Gross Profit | 7,144,400 | 622,600 | 11,078,900 | 1,629,200 |
Operating Expenses | 3,322,100 | 1,458,200 | 7,639,700 | 3,769,900 |
Operating Income (Loss) | 3,822,300 | (835,600) | 3,439,200 | (2,140,700) |
Other Income (Expense) | ||||
Loss on Sale of Equipment | (12,400) | (35,900) | (27,900) | |
Forgiveness of Debt | 10,000 | |||
Other Income | 1,200 | 113,800 | 13,000 | |
Interest Expense | (115,100) | (163,900) | (298,500) | (254,200) |
Total Other Income (Expense) | (113,900) | (176,300) | (210,600) | (269,100) |
Income (Loss) Before Income Tax | 3,708,400 | (1,011,900) | 3,228,600 | (2,409,800) |
Income Tax Benefit | 571,600 | 561,500 | ||
Net Income (Loss) Attributable to Stockholders | 3,708,400 | (440,300) | 3,228,600 | (1,848,300) |
Net (Loss) Attributable to Non-controlling interests | (3,200) | 1,700 | (228,100) | |
Preferred Dividends | (631,400) | (771,500) | ||
Net Income (Loss) Attributable to Common Stockholders | $ 3,077,000 | $ (437,100) | $ 2,458,800 | $ (1,620,200) |
Net Income (Loss) Per Share - Basic | $ 0.21 | $ (0.10) | $ 0.17 | $ (0.43) |
Net Income (Loss) Per Share - Diluted | $ 0.20 | $ (0.10) | $ 0.17 | $ (0.43) |
Weighted Average Common Shares Outstanding - Basic | 14,898,594 | 4,180,054 | 14,350,143 | 3,737,318 |
Weighted Average Common Shares Outstanding - Diluted | 15,058,918 | 4,180,054 | 14,515,710 | 3,737,318 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
CASH FLOWS FROM OPERATING ACTIVITIES | ||
Net Income (Loss) | $ 3,228,600 | $ (1,848,300) |
Adjustments to reconcile net income (loss) to net cash from operating activities: | ||
Depreciation | 783,500 | 419,200 |
Amortization of right of use assets | 252,200 | 194,700 |
Forgiveness on PPP loan | (10,000) | |
Loss on sale of equipment | 35,900 | 27,900 |
Stock compensation | 416,100 | 11,000 |
Net change in assets and liabilities: | ||
Accounts receivable | (26,600) | (42,500) |
Contract assets | (4,762,400) | |
Prepaid expenses | 820,300 | (255,900) |
Real estate | (82,755,400) | (8,286,200) |
Deferred revenue | (874,600) | 1,297,400 |
Deferred income tax | (561,500) | |
Payments on right of use liability | (241,600) | (209,000) |
Contract Liability | 390,900 | |
Accounts payable and accrued expenses | 3,175,800 | (605,500) |
NET CASH (USED IN) OPERATING ACTIVITIES | (79,567,300) | (9,858,700) |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Purchase of property and equipment | (378,100) | (401,100) |
Proceeds on the sale of equipment | 69,500 | 330,400 |
NET CASH (USED IN) INVESTING ACTIVITIES | (308,600) | (70,700) |
CASH FLOWS FROM FINANCING ACTIVITIES | ||
Construction loans, net | 29,468,300 | 8,829,900 |
Financing fees construction loans | (1,476,900) | (573,100) |
Construction loans related parties, net | 6,302,800 | (6,515,700) |
Financing fees related party construction loans | (1,983,900) | (396,900) |
Payments on financing leases | (289,000) | (380,000) |
Proceeds from PPP loan | 582,800 | |
Payments on PPP loan | (9,300) | |
Due to related party | (8,100) | |
Repayments on note payable D&O insurance | (867,600) | |
Net proceeds from issuance of common stock | 25,101,000 | 10,789,100 |
Net proceeds from issuance of preferred stock | 28,661,000 | |
Repayment on equipment loans | (1,430,500) | (476,700) |
Proceeds from exercise of stock options | 18,000 | |
Dividends | (560,900) | |
Deferred offering cost | (68,300) | |
NET CASH PROVIDED BY FINANCING ACTIVITIES | 82,864,700 | 11,851,300 |
NET INCREASE IN CASH AND RESTRICTED CASH | 2,988,800 | 1,921,900 |
CASH AND RESTRICTED CASH AT BEGINNING OF YEAR | 2,396,500 | 430,000 |
CASH AND RESTRICTED CASH AT END OF PERIOD | 5,385,300 | 2,351,900 |
SUPPLEMENTAL CASH FLOW INFORMATION | ||
Interest paid | 2,165,300 | 1,266,300 |
SUPPLEMENTAL DISCLOSURE OF NON-CASH INVESTING AND FINANCING ACTIVITIES | ||
Financing of assets additions | 1,566,800 | 2,002,900 |
Dividends declared but not paid | 210,600 | |
New right of use obligations | 166,800 | |
Cancellation of finance leases | 99,100 | |
Amortization of debt discount capitalized | 2,338,000 | 1,323,300 |
Stock issued for conversion of related party interest and principle | $ 497,000 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Changes in Stockholders' Equity (Deficit) (Unaudited) - USD ($) | Common Stock [Member] | Preferred Stock [Member] | Additional Paid-in Capital [Member] | Retained Earnings [Member] | Parent [Member] | Noncontrolling Interest [Member] | Total |
Beginning balance, value at Dec. 31, 2019 | $ 670,900 | $ 119,100 | $ (954,300) | $ (164,300) | $ (1,060,600) | $ (1,224,900) | |
Beginning balance, shares at Dec. 31, 2019 | 3,513,517 | ||||||
Net Income (Loss) | (752,000) | (752,000) | (221,900) | (973,900) | |||
Ending balance, value at Mar. 31, 2020 | $ 670,900 | 119,100 | (1,706,300) | (916,300) | (1,282,500) | (2,198,800) | |
Ending balance, shares at Mar. 31, 2020 | 3,513,517 | ||||||
Beginning balance, value at Dec. 31, 2019 | $ 670,900 | 119,100 | (954,300) | (164,300) | (1,060,600) | (1,224,900) | |
Beginning balance, shares at Dec. 31, 2019 | 3,513,517 | ||||||
Net Income (Loss) | (1,848,300) | ||||||
Ending balance, value at Sep. 30, 2020 | $ 11,957,000 | 130,100 | (2,574,500) | 9,512,600 | (1,288,700) | 8,223,900 | |
Ending balance, shares at Sep. 30, 2020 | 5,628,048 | ||||||
Beginning balance, value at Mar. 31, 2020 | $ 670,900 | 119,100 | (1,706,300) | (916,300) | (1,282,500) | (2,198,800) | |
Beginning balance, shares at Mar. 31, 2020 | 3,513,517 | ||||||
Stock Compensation Expense | 1,100 | 1,100 | 1,100 | ||||
Net Income (Loss) | (431,100) | (431,100) | (3,000) | (434,100) | |||
Ending balance, value at Jun. 30, 2020 | $ 670,900 | 120,200 | (2,137,400) | (1,346,300) | (1,285,500) | (2,631,800) | |
Ending balance, shares at Jun. 30, 2020 | 3,513,517 | ||||||
Net proceeds issuance of common stock | $ 10,789,100 | 10,789,100 | 10,789,100 | ||||
Net proceeds issuance of common stock, shares | 2,031,705 | ||||||
Conversion of related party debt to common stock | $ 497,000 | 497,000 | 497,000 | ||||
Conversion of related party debt to common stock, shares | 82,826 | ||||||
Stock Compensation Expense | 9,900 | 9,900 | 9,900 | ||||
Net Income (Loss) | (437,100) | (437,100) | (3,200) | (440,300) | |||
Ending balance, value at Sep. 30, 2020 | $ 11,957,000 | 130,100 | (2,574,500) | 9,512,600 | (1,288,700) | 8,223,900 | |
Ending balance, shares at Sep. 30, 2020 | 5,628,048 | ||||||
Beginning balance, value at Dec. 31, 2020 | $ 11,956,900 | 234,800 | (4,487,100) | 7,704,600 | (1,289,900) | 6,414,700 | |
Beginning balance, shares at Dec. 31, 2020 | 5,636,548 | ||||||
Net proceeds issuance of common stock | $ 25,101,000 | 25,101,000 | 25,101,000 | ||||
Net proceeds issuance of common stock, shares | 9,200,000 | ||||||
Exercise of stock options | 18,000 | 18,000 | $ 18,000 | ||||
Exercise of stock options, shares | 45,046 | ||||||
Stock Compensation Expense | 115,100 | 115,100 | $ 115,100 | ||||
Stock Compensation Expense, shares | 8,500 | ||||||
Net Income (Loss) | (1,549,800) | (1,549,800) | 600 | (1,549,200) | |||
Ending balance, value at Mar. 31, 2021 | $ 37,057,900 | 367,900 | (6,036,900) | 31,388,900 | (1,289,300) | 30,099,600 | |
Ending balance, shares at Mar. 31, 2021 | 14,890,094 | ||||||
Beginning balance, value at Dec. 31, 2020 | $ 11,956,900 | 234,800 | (4,487,100) | 7,704,600 | (1,289,900) | 6,414,700 | |
Beginning balance, shares at Dec. 31, 2020 | 5,636,548 | ||||||
Net Income (Loss) | 3,228,600 | ||||||
Ending balance, value at Sep. 30, 2021 | $ 37,057,900 | $ 28,661,000 | 668,900 | (2,028,300) | 64,359,500 | (1,291,600) | 63,067,900 |
Ending balance, shares at Sep. 30, 2021 | 14,922,094 | 1,260,555 | |||||
Beginning balance, value at Mar. 31, 2021 | $ 37,057,900 | 367,900 | (6,036,900) | 31,388,900 | (1,289,300) | 30,099,600 | |
Beginning balance, shares at Mar. 31, 2021 | 14,890,094 | ||||||
Net proceeds issuance of preferred stock | $ 28,661,000 | 28,661,000 | 28,661,000 | ||||
Net proceeds issuance of preferred stock, shares | 1,260,555 | ||||||
Dividends | (140,100) | (140,100) | (140,100) | ||||
Stock Compensation Expense | 115,800 | 115,800 | 115,800 | ||||
Stock Compensation Expense, shares | 8,500 | ||||||
Net Income (Loss) | 1,071,700 | 1,071,700 | (2,300) | 1,069,400 | |||
Ending balance, value at Jun. 30, 2021 | $ 37,057,900 | $ 28,661,000 | 483,700 | (5,105,300) | 61,097,300 | (1,291,600) | 59,805,700 |
Ending balance, shares at Jun. 30, 2021 | 14,898,594 | 1,260,555 | |||||
Dividends | (631,400) | (631,400) | (631,400) | ||||
Stock Compensation Expense | 185,200 | 185,200 | 185,200 | ||||
Stock Compensation Expense, shares | 23,500 | ||||||
Net Income (Loss) | 3,708,400 | 3,708,400 | 3,708,400 | ||||
Ending balance, value at Sep. 30, 2021 | $ 37,057,900 | $ 28,661,000 | $ 668,900 | $ (2,028,300) | $ 64,359,500 | $ (1,291,600) | $ 63,067,900 |
Ending balance, shares at Sep. 30, 2021 | 14,922,094 | 1,260,555 |
NATURE OF OPERATIONS AND SUMMAR
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations The Company’s principal business activity involves acquiring raw land and developed lots for the purpose of building and selling single family and multi-family dwellings in Washington, California, Texas and Florida. It utilizes its heavy equipment resources to develop an inventory of finished lots and provide development infrastructure construction, on a contract basis, for other home builders. Single family construction and infrastructure construction contracts vary but are typically less than one year. On August 1, 2019, the Company changed its name from Harbor Custom Homes, Inc. to Harbor Custom Development, Inc. The Company became an effective filer with the Securities and Exchange Commission (“SEC”) and started trading on The Nasdaq Stock Market LLC (“Nasdaq”) on August 28, 2020. Principles of Consolidation The consolidated financial statements include the following subsidiaries of Harbor Custom Development, Inc. as of the reporting period ending dates as follows (all entities are formed as Washington LLCs): SCHEDULE OF STATEMENT OF SUBSIDIARIES Names Dates of Formation Attributable Interest September 30, December 31, 2021 2020 Saylor View Estates, LLC March 30, 2014 51 % 51 % Belfair Apartments, LLC December 3, 2019 100 % 100 % Pacific Ridge CMS, LLC May 24, 2021 100 % N/A Tanglewilde, LLC June 25, 2021 100 % 100 % HCDI FL CONDO LLC August 3, 2021 100 % N/A HCDI Mira, LLC August 30, 2021 100 % N/A HCDI Wyndstone, LLC September 15, 2021 100 % N/A All intercompany transactions and balances have been eliminated in consolidation. As of September 30, 2021 and December 31, 2020, the aggregate non-controlling interest was $( 1,291,600 1,289,900 Basis of Presentation The unaudited financial information furnished herein reflects all adjustments, consisting solely of normal recurring items, which in the opinion of management are necessary to fairly state the financial position of the Company and the results of its operations for the periods presented. This report should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 31, 2021. The Company assumes that the users of the interim financial information herein have read or have access to the audited financial statements for the preceding fiscal year and the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The condensed consolidated balance sheet at December 31, 2020 was derived from the audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The results of operations for the interim periods presented are not necessarily indicative of results for the year ending December 31, 2021. The Company’s Board of Directors and stockholders approved a 1-for-2.22 reverse split of the Company’s common stock, which was effected on April 15, 2020. The reverse split combined each 2.22 shares of the Company’s outstanding common stock into one share of common stock. as if it had occurred at the beginning of the earliest period presented. All numbers in these financial statements are rounded to the nearest $100. Use of Estimates Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were used. Stock-Based Compensation Effective as of November 19, 2018, the Company’s Board of Directors and stockholders approved and adopted the 2018 Incentive and Non-Statutory Stock Option Plan (the “2018 Plan”). The 2018 Plan allows the Administrator (as defined in the 2018 Plan), currently the Board of Directors, to determine the issuance of incentive stock options and non-qualified stock options to eligible employees and outside directors and consultants of the Company. The Company reserved 675,676 Effective as of December 3, 2020, the Company’s Board of Directors and stockholders approved and adopted the 2020 Restricted Stock Plan (the “2020 Plan”). The 2020 Plan allows the Administrator (currently the Compensation Committee) to determine the issuance of restricted stock to eligible officers, directors, and key employees. The Company reserved 700,000 The Company accounts for stock-based compensation in accordance with ASC Topic 718, “ Compensation – Stock Compensation” The Company recognizes all forms of share-based payments, including stock option grants, warrants and restricted stock grants, at their fair value on the grant date, which is based on the estimated number of awards that are ultimately expected to vest. Options and warrants are valued using a Black-Scholes option pricing model. Grants of share-based payment awards issued to non-employees for services rendered have been recorded at the fair value of the share-based payment. The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period. If an award is granted, but vesting does not occur, any previously recognized compensation expense is reversed in the period related to the termination of service. Stock-based compensation expenses are included in selling, general and administrative expenses in the consolidated statement of operations. For the nine months ended September 30, 2021 and 2020 when computing fair value of share-based payments, the Company has considered the following variables: SCHEDULE OF FAIR VALUE ASSUMPTIONS OF SHARE-BASED PAYMENTS September 30, 2021 September 30, 2020 Risk-free interest rate 0.23 1.11 % 0.47 1.46 % Exercise price $ 2.76 5.00 $ 2.22 7.50 Expected life of grants 2.50 6.5 2.99 6.00 Expected volatility of underlying stock 42.63 56.13 % 32.39 43.41 % Dividends 0 0 The expected term is computed using the “simplified” method as permitted under the provisions of ASC 718-10-S99. The Company uses the simplified method to calculate the expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. The share price as of the grant date was determined by an independent third party 409(a) valuation until the Company’s stock became publicly traded. Now the share price is the public trading price at the time of grant. Expected volatility is based on the historical stock price volatility of comparable companies’ common stock, as the stock does not have sufficient historical trading activity. Risk free interest rates were obtained from U.S. Treasury rates for the applicable periods. Earnings (Loss) Per Share Earnings (Loss) per share (“EPS”) is the amount of earnings attributable to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed pursuant to Section 260-10-45 of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16, basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. Income available to common stockholders shall be computed by deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for the period on cumulative preferred stock (whether or not earned) from income from continuing operations (if that amount appears in the income statement) and also from net income. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) attributable to common stockholders per common share. SCHEDULE OF NET INCOME (LOSS) PER SHARE 2021 2020 2021 2020 For the Three Months For the Nine Months September 30, September 30, 2021 2020 2021 2020 Numerator: Net income (loss) attributable to common stockholders $ 3,077,000 $ (437,100 ) $ 2,458,800 $ (1,620,200 ) Effect of dilutive securities: - - - - Diluted net income (loss) $ 3,077,000 $ (437,100 ) $ 2,458,800 $ (1,620,200 ) Denominator: Weighted average common shares outstanding - basic 14,898,594 4,180,054 14,350,143 3,737,318 Dilutive securities (a): Options 140,957 - 145,884 - Warrants 19,367 - 19,683 - Weighted average common shares outstanding and assumed 15,058,918 4,180,054 14,515,710 3,737,318 conversion – diluted Basic net income (loss) per common share $ 0.21 $ (0.10 ) $ 0.17 $ (0.43 ) Diluted net income (loss) per common share $ 0.20 $ (0.10 ) $ 0.17 $ (0.43 ) (a) - Anti-dilutive securities excluded: 9,379,890 164,308 9,379,890 164,308 Fair Value of Financial Instruments For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amount of the Company’s short-term financial instruments approximates fair value due to the relatively short period to maturity for these instruments. Cash and Cash Equivalents For purposes of the statement of cash flows, the Company considers all short-term debt securities purchased with a maturity of three months or less to be cash equivalents. There were no Restricted Cash On August 10, 2021, the Company entered a Letter of Credit (“LOC”) agreement with WaFd bank in the amount of $ 597,600 Accounts Receivable Accounts receivables are reported at the amount the Company expects to collect from outstanding balances. The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection information and existing economic conditions. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. The allowance for doubtful accounts was $ 11,000 0 Property and Equipment and Depreciation Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method (after considering their respective estimated residual values) over the estimated useful lives: SCHEDULE OF PROPERTY AND EQUIPMENT ESTIMATED USEFUL LIVES Construction Equipment 5 10 years Leasehold Improvements The lesser of 10 years or the remaining life of the lease Furniture and Fixtures 5 years Computers 3 years Vehicles 10 years Real Estate Assets Real estate assets are recorded at cost, except when real estate assets are acquired that meet the definition of a business combination in accordance with FASB ASC 805, “Business Combinations,” where acquired assets are recorded at fair value. Interest, property taxes, insurance and other incremental costs (including salaries) directly related to a project are capitalized during the construction period of major facilities and land improvements. The capitalization period begins when activities to develop the parcel commence and ends when the asset constructed is completed. The capitalized costs are recorded as part of the asset to which they relate and are expensed when the underlying asset is sold. The Company capitalized interest from related party borrowings of $ 152,800 203,600 557,200 840,000 298,200 783,100 774,000 1,834,000 A property is classified as “held for sale” when all the following criteria for a plan of sale have been met: (1) Management, having the authority to approve the action, commits to a plan to sell the property; (2) The property is available for immediate sale in its present condition, subject only to terms that are usual and customary; (3) An active program to locate a buyer and other actions required to complete the plan to sell, have been initiated; (4) The sale of the property is probable and is expected to be completed within one year of the contract date; (5) The property is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and (6) Actions necessary to complete the plan of sale indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. When all these criteria have been met, the property is classified as “held for sale.” In addition to the annual assessment of potential triggering events in accordance with ASC 360, the Company applies a fair value-based impairment test to the net book value assets on an annual basis and on an interim basis if certain events or circumstances indicate that an impairment loss may have occurred. As of September 30, 2021 and December 31, 2020, the Company did not have any projects that qualified for an impairment charge. Revenue and Cost Recognition ASC 606, Revenue from Contracts with Customers (“ASC 606”), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contract to provide goods or services to customers. In accordance with ASC 606, revenue is recognized when a customer obtains control of the promised good or service. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these goods or services. The provision of ASC 606 includes a five-step process by which the Company determines revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which the Company expects to be entitled in exchange for those goods or services. ASC 606 requires the Company to apply the following steps: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, performance obligations are satisfied. A detailed breakdown of the five-step process for the revenue recognition of Entitled Land Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with a buyer to purchase the parcel of entitled land. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering entitled land to the customer, which are required to meet certain specifications outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. The parcel is a separate performance obligation for which the specific price is in the contract. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue when title is transferred. The Company does not have any further performance obligations once title is transferred. A detailed breakdown of the five-step process for the revenue recognition of Developed Lots Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with the buyer to purchase lots that have completed infrastructure. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering developed lots to the customer, which are required to meet certain specifications that are outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. All lots are a single performance obligation for the specific price in the contract. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue when title is transferred. The Company does not have any further performance obligations once title is transferred. A detailed breakdown of the five-step process for the revenue recognition of Fee Build Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with a customer to construct the required infrastructure so that houses can be developed on the lots. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering developed lots which are required to meet certain specifications that are outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. The nature of the industry involves a number of uncertainties that can affect the current state of the contract. Variable considerations are the estimates made due to a contract modification in the contractual service. Change orders, claims, extras, or back charges are common in contractual services activity as a form of variable consideration. If there is going to be a contract modification, judgment by management will need to be made to determine if the variable consideration is enforceable. The following factors are considered in determining if the variable consideration is enforceable: 1. The customer’s written approval of the scope of the change order; 2. Current contract language that indicates clear and enforceable entitlement relating to the change order; 3. Separate documentation for the change order costs that are identifiable and reasonable; and 4. The Company’s experience in negotiating change orders, especially as it relates to the specific type of contract and change order being evaluated. Once the Company receives a contract, it generates a budget of projected costs for the contract based on the contract price. If the scope of the contract during the contractual period needs to be modified, the Company files a change order. The Company does not continue to perform services until the change modification is agreed upon with documentation by both the Company and the customer. There are few times that claims, extras, or back charges are included in the contract. If there are multiple performance obligations to the contract, the costs must be allocated appropriately and consistently to each performance obligation. In the Company’s experience, usually only one performance obligation is stated per contract. If there are multiple services provided for one customer, the Company has a policy of splitting out the services over multiple contracts. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company uses the total costs incurred on the project relative to the total expected costs to satisfy the performance obligation. The input method involves measuring the resources consumed, labor hours expended, costs incurred, time lapsed, or machine hours used relative to the total expected inputs to the satisfaction of the performance obligation. Costs incurred prior to actual contract (i.e., design, engineering, procurement of material, etc.) should not be recognized as the Company does not have control of the good/service provided. When the estimate on a contract indicates a loss or claims against costs incurred reduce the likelihood of recoverability of such costs, the Company records the entire estimated loss in the period the loss becomes known. Project contracts typically provide for a schedule of billings or invoices to the customer based on the Company’s job to date percentage of completion of specific tasks inherent in the fulfillment of its performance obligation(s). The schedules for such billings usually do not precisely match the schedule on which costs are incurred. As a result, contract revenue recognized in the statement of operations can and usually does differ from amounts that can be billed or invoiced to the customer at any point during the contract. Amounts by which cumulative contract revenue recognized on a contract as of a given date exceed cumulative billings and unbilled receivables to the customer under the contract are reflected as a current asset in the Company’s balance sheet under the caption “Contract Asset” which is further disclosed in Note 15. Amounts by which cumulative billings to the customer under a contract as of a given date exceed cumulative contract revenue recognized on the contract are reflected as a current liability in the Company’s balance sheet under the caption “Billings in excess of costs and estimated earnings.” A detailed breakdown of the five-step process for the revenue recognition of Home Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with a home buyer to purchase a lot with a completed house. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering a developed lot with a completed house to the customer, which is required to meet certain specifications that are outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. Each lot with a completed house is a separate performance obligation, for which the specific price in the contract is allocated. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue when title is transferred. The Company does not have any further performance obligations once title is transferred. A detailed breakdown of the five-step process for the revenue recognition of Construction Materials sold to or received from contractors is as follows: 1. Identify the contract with a customer. There are no signed contracts. Each transaction is verbally agreed to with the customer. 2. Identify the performance obligations in the contract. The Company delivers or receives materials from customers based on the verbal agreement reached. 3. Determine the transaction price. The Company has a set price list for receiving approved fill materials to recycle or provides customers with a combination of said materials. 4. Allocation of the transaction price to performance obligations in the contract. There is only one performance obligation, which is to pick up or deliver the materials. The entire transaction price is therefore allocated to the performance obligation. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The performance obligation is fulfilled, and revenue is recognized when the materials have been received or delivered by the Company. Revenues from contracts with customers are summarized by category as follows for the three and nine months ended September 30: SCHEDULE OF REVENUES FROM CONTRACTS WITH CUSTOMERS 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Entitled Land $ 10,440,000 $ - $ 19,750,000 $ - Developed Lots 770,000 - 7,770,000 - Fee Build 2,871,300 - 4,219,500 - Homes 3,762,000 7,704,300 13,947,900 25,625,300 Construction Materials 167,300 102,200 329,800 452,000 Total Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 Disaggregation of Revenue from Contracts with Customers The following table disaggregates the Company’s revenue based on the type of sale or service and the timing of satisfaction of performance obligations for the three and nine months ended September 30, 2021 and 2020: DISAGGREGATION OF REVENUE FROM CONTRACTS WITH CUSTOMERS 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Performance obligations satisfied at a point in time $ 15,139,300 $ 7,806,500 $ 41,797,700 $ 26,077,300 Performance obligations satisfied over time 2,871,300 - 4,219,500 - Total Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 Cost of Sales Land acquisition costs are allocated to each lot based on the size of the lot in relation to the size of the total project. Development cost and capitalized interest are allocated to lots sold based on the same criteria. Costs relating to the handling of recycled construction materials and converting items into usable construction materials for resale are charged to cost of sales as incurred. Advertising Costs for designing, producing and communicating advertising are expensed as incurred. Advertising expense for the three months ended September 30, 2021 and 2020 was $ 15,600 0 Advertising expense for the nine months ended September 30, 2021 and 2020 was $ 27,600 8,500 Leases On January 1, 2019, the Company adopted ASU 2016-02 “ Leases” As part of the adoption the Company elected the practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to: 1. Not separate non-lease components from lease components and instead to account for each separate lease component and the non-lease components associated with that lease component as a single lease; 2. Not to apply the recognition requirements in ASC 842 to short-term leases; and 3. Not record a right of use asset or right of use liability for leases with an asset or liability balance that would be considered immaterial. Income Taxes Deferred income tax assets and liabilities are determined based on the estimated future tax effects of net operating loss, credit carryforwards and temporary differences between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted tax rates. Management applies the criteria established in the FASB released Accounting Standards Update No. 2019-12, Income taxes (Topic 740) (the Update) to determine if any valuation allowances are needed each year. The Company recognizes a tax benefit for an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. There are no uncertain tax positions as of September 30, 2021 and December 31, 2020. Recent Accounting Pronouncements On December 18, 2019, the FASB released Accounting Standards Update No. 2019-12, Income taxes (Topic 740) (the Update). The Board issued this update as part of its initiative to reduce complexity in accounting standards. The Standard is effective for fiscal years beginning after December 15, 2020. The adoption did not have a material impact on the Company. In August 2020, the FASB issued Accounting Standards Update 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company. On May 3, 2021, the FASB released Accounting Standards Update No. 2021-04, Compensation – Earning Per Share (Topic 260), Debt - Modifications and Extinguishments (subtopic 470-50), Compensation - Stock compensation (Topic 718), Contracts in Entity’s Own Equity (Subtopic 815-40) Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. FASB issued this update to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example warrants) that remain equity classified after modification or exchange. The Standard is effective for fiscal years beginning after December 15, 2021. The Company does not believe the adoption will have a material impact on the Company. Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or circumstances indicate that the carrying value of such assets may not be fully recoverable. Impairment is present when the sum of estimated undiscounted future cash flow expected to result from use of the assets is less than carrying value. If impairment is present, the carrying value of the impaired asset is reduced to its fair value. Fair value is determined based on discounted cash flow or appraised values, depending on the nature of the assets. As of September 30, 2021 and December 31, 2020, there were no impairment losses recognized for long-lived assets. Offering Costs Associated with a Public Offering The Company complies with the requirements of FASB ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A — “ Expenses of Offering.” On January 15 and 20, 2021, the Company closed on a follow-on public offering and over-allotment option, respectively, of common stock. During 2020, the Company incurred approximately $ 65,100 of capitalizable costs associated with the follow-on public offering, which were netted against the proceeds received in 2021. These costs were capitalized as of December 31, 2020 and are shown on the Balance Sheet as Deferred Offering Costs. As of September 30, 2021, the Company incurred approximately $ 133,400 |
CONCENTRATION, RISKS, AND UNCER
CONCENTRATION, RISKS, AND UNCERTAINTIES | 9 Months Ended |
Sep. 30, 2021 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATION, RISKS, AND UNCERTAINTIES | 2. CONCENTRATION, RISKS, AND UNCERTAINTIES Cash Concentrations The Company maintains cash balances at various financial institutions. These balances are secured by the Federal Deposit Insurance Corporation. These balances generally exceed the federal insurance limits. Uninsured cash balances were $ 4,264,400 2,146,000 Revenue Concentrations Homes For the three months ended September 30, 2021, five customers each represented 19 % of homes revenue. For the nine months ended September 30, 2021, there were no concentrations in relation to the homes revenue segment. For the three and nine months ended September 30, 2020, there were no concentrations in relation to the homes revenue segment. Completed Lots For the three months ended September 30, 2021, three customers represented 38 %, 38 %, and 24 % of completed lots revenue, respectively. For the three months ended September 30, 2020, there were no concentrations in relation to the completed lots revenue segment. For the nine months ended September 30, 2021 and 2020, Lennar Northwest, Inc. (“Lennar”) represented 90 % and 0 % of the completed lots revenue, respectively. Entitled Land For the three months ended September 30, 2021 and 2020, Lennar represented 100 % and 0 % of entitled land revenue, respectively. For the nine months ended September 30, 2021 and 2020, Lennar represented 100 % and 0 % of entitled land revenue, respectively. Fee Build For the three months ended September 30, 2021 and 2020, Lennar represented 100 % and 0 % of fee build revenue, respectively. For the nine months ended September 30, 2021 and 2020, Lennar represented 100 % and 0 % of fee build revenue, respectively. COVID-19 In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (“ COVID-19 The COVID-19 Pandemic has had the following effect on the Company’s business: 1. Construction not related to safety, spoliation, or critical infrastructure was halted by Washington State Governor Inslee (the “Governor”) on March 23, 2020. Some operations could continue based on the aforementioned exceptions to the shutdown order, but the Company did experience a significant operational slowdown. 2. Soundview Estates (a large Harbor Custom Development, Inc. site) continued selective activities that yielded rock byproduct, considered an essential material, needed for critical infrastructure projects for an Amazon distribution center and a local hospital. 3. On April 24, 2020, the Governor approved the restart of most residential housing projects, deeming them essential, as long as they adhered to certain safety measures. Under this order, most existing permitted residential homes or projects were considered essential. The order allowed the Company to resume near full construction activities on all permitted lots. 4. On May 1, 2020, the Governor established a four-phase plan for Washington businesses to follow. All Harbor Custom Development, Inc. development sites were in Phase 3 of the plan where construction was able to continue, and new construction was allowed, as long as the Company created a safety plan adhering to certain safety practices, which the Company had done. 5. As of June 30, 2021, Washington State reopened the state under the Washington Ready plan. All industry sectors previously covered by the Roadmap to Recovery or the Safe Start Plan (which included all Harbor Custom Development, Inc. operational activities) returned to usual capacity and operations. The Company has not, at this time, experienced any cancelled sales contracts. The Company has experienced some supply-chain issues with both cabinetry and appliances related to COVID-19. As of the date of this report, the Company’s projects are on-schedule and operations are not being materially impacted by the COVID-19 pandemic. While there could ultimately be a material impact on operations and liquidity of the Company, at the time of issuance of this report, the ultimate impact could not be determined. |
PROPERTY AND EQUIPMENT
PROPERTY AND EQUIPMENT | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
PROPERTY AND EQUIPMENT | 3. PROPERTY AND EQUIPMENT Property and equipment stated at cost, less accumulated depreciation and amortization, consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, 2021 December 31, 2020 Machinery and Equipment $ 10,557,100 $ 8,908,000 Vehicles 71,800 73,500 Furniture and Fixtures 147,500 136,300 Leasehold Improvements 7,000 7,000 Total Fixed Assets 10,783,400 9,124,800 Less Accumulated Depreciation (1,650,500 ) (948,800 ) Fixed Assets, Net $ 9,132,900 $ 8,176,000 Depreciation expense was $ 300,400 133,400 Depreciation expense was $ 783,500 419,200 |
REAL ESTATE
REAL ESTATE | 9 Months Ended |
Sep. 30, 2021 | |
Real Estate [Abstract] | |
REAL ESTATE | 4. REAL ESTATE Real Estate consisted of the following components: SCHEDULE OF REAL ESTATE September 30, 2021 December 31, 2020 Land Held for Development $ 77,841,100 $ 9,532,800 Construction in Progress 23,620,300 9,042,700 Held for Sale 4,002,300 1,794,800 Real estate $ 105,463,700 $ 20,370,300 |
EQUIPMENT LOANS
EQUIPMENT LOANS | 9 Months Ended |
Sep. 30, 2021 | |
Schedule Of Future Equipment Loan Maturities | |
EQUIPMENT LOANS | 5. EQUIPMENT LOANS Consists of the following: SCHEDULE OF EQUIPMENT LOANS September 30, 2021 December 31, 2020 Various notes payable to banks and financial institutions with interest rates varying from 0.00 13.89 400 11,600 through 2026 $ 5,731,800 $ 5,595,500 Book value of collateralized equipment: $ 7,840,900 $ 6,475,600 Future equipment loan maturities are as follows: For the twelve months ended September 30: SCHEDULE OF FUTURE EQUIPMENT LOAN MATURITIES 2022 $ 1,876,900 2023 1,787,700 2024 1,652,200 2025 410,200 2026 4,800 Equipment Loans $ 5,731,800 |
CONSTRUCTION LOANS
CONSTRUCTION LOANS | 9 Months Ended |
Sep. 30, 2021 | |
Construction Loans | |
CONSTRUCTION LOANS | 6. CONSTRUCTION LOANS The Company has various construction loans with private individuals and finance companies. The loans are collateralized by specific construction projects. All loans have a one 5 39 39,560,700 10,092,500 105,463,700 20,370,300 |
LINE OF CREDIT
LINE OF CREDIT | 9 Months Ended |
Sep. 30, 2021 | |
Line Of Credit | |
LINE OF CREDIT | 7. LINE OF CREDIT The Company entered into a Line of credit (“LOC”) agreement with WaFd bank of $ 597,600 no 0 |
NOTE PAYABLE D&O INSURANCE
NOTE PAYABLE D&O INSURANCE | 9 Months Ended |
Sep. 30, 2021 | |
Note Payable Do Insurance | |
NOTE PAYABLE D&O INSURANCE | 8. NOTE PAYABLE D&O INSURANCE The Company purchased D&O insurance on August 28, 2020 for $ 1,531,900 306,400 1,225,500 4.74 0 741,200 The Company purchased D&O insurance on September 1, 2021 for $ 1,541,400 . A down payment of $ 131,100 was made and the remaining balance of $ 1,410,300 was financed over ten months 4.42 %. The loan balance as of September 30, 2021 and December 31, 2020 was $ 1,284,000 and $ 0 , respectively. |
NOTE PAYABLE PPP
NOTE PAYABLE PPP | 9 Months Ended |
Sep. 30, 2021 | |
Debt Disclosure [Abstract] | |
NOTE PAYABLE PPP | 9. NOTE PAYABLE PPP On April 11, 2020, the Company entered into a term note with Timberland Bank, with a principal amount of $ 582,800 1.00 The PPP Term Note is unsecured and guaranteed by the United States Small Business Administration. The Company may apply for forgiveness of the PPP Term Note, with the amount which may be forgiven equal to the sum of payroll costs, covered rent and mortgage obligations, and covered utility payments incurred by the Company during the applicable period beginning upon receipt of PPP Term Note funds, calculated in accordance with the terms of the CARES Act. On November 9, 2020 and February 1, 2021, the SBA forgave $ 562,300 10,000 As of September 30, 2021 and December 31, 2020, the balance of the PPP Loan was $ 0 19,300 |
DEFINED CONTRIBUTION PLAN
DEFINED CONTRIBUTION PLAN | 9 Months Ended |
Sep. 30, 2021 | |
Retirement Benefits [Abstract] | |
DEFINED CONTRIBUTION PLAN | 10. DEFINED CONTRIBUTION PLAN Effective January 1, 2016, the Company established a 401(k) plan for qualifying employees; employee contributions are voluntary. Company contributions to the plan for the three months ended September 30, 2021 and 2020 were $ 24,900 0 74,500 0 |
COMMITMENTS
COMMITMENTS | 9 Months Ended |
Sep. 30, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS | 11. COMMITMENTS From time to time the Company is subject to compliance audits by federal, state and local authorities relating to a variety of regulations including wage and hour laws, taxes, and workers’ compensation. There are no significant or pending litigation or regulatory proceedings known at this time. On September 17, 2020, the Company entered into a purchase and sale agreement for the acquisition of 9.6 1,440,000 On June 15, 2020, the Company entered into a purchase and sale agreement to acquire property for the construction of 30 townhomes located in East Bremerton, Washington for $ 2,040,000 On August 8, 2021, the Company entered into a purchase and sale agreement to acquire property for the construction of 75 condominiums units located in Yelm, Washington for $ 3,250,000 On August 30, 2020, the Company entered into a purchase and sale agreement for the acquisition of 67 lot in Auburn, California. Closing is expected to take place on or before August 30, 2022. |
RELATED PARTY TRANSACTIONS
RELATED PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2021 | |
Related Party Transactions [Abstract] | |
RELATED PARTY TRANSACTIONS | 12. RELATED PARTY TRANSACTIONS Notes Payable The Company entered into construction loans with Sound Equity, LLC of which Robb Kenyon, a former director and minority shareholder, is a partner. These loans were originated between April 2019 and January 2021; all of the loans have a one 8.49 12.00 0 178,500 552,800 283,300 292,600 202,500 0 296,100 1,431,100 840,000 1,123,700 466,600 12,792,300 6,489,900 The Company entered into a construction loan with Curb Funding, LLC of which Robb Kenyon a former director and minority shareholder, is 100 12 0 3,500 0 1,100 0 51,800 2,800 0 Robb Kenyon resigned as a director of the Company on July 8, 2021. On April 19, 2019, the Company entered into a construction loan with Olympic Views, LLC of which the Company’s Chief Executive Officer and President previously owned a 50% interest. The loan amount was $ 442,000 0 0 0 8,900 0 41,900 55,000 6.00 82,826 Due to Related Party The Company utilizes a quarry to process waste materials from the completion of raw land into sellable/buildable lots. The quarry is located on land owned by SGRE, LLC which is 100 25 8,200 0 17,100 209,100 72,800 209,100 Richard Schmidtke, a Company director, provided accounting services in 2021 and 2020 to the Company. On September 30, 2021 and December 31, 2020, the fees payable to Mr. Schmidtke were $ 0 500 500 6,000 1,000 40,300 Land Purchase from a Related Party On September 2, 2020, the Company purchased 99 unfinished lots for $ 3,430,000 50 |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 9 Months Ended |
Sep. 30, 2021 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | 13. STOCKHOLDERS’ EQUITY Common Stock The Company is authorized to issue 50,000,000 14,922,094 Each share of common stock has one vote per share for all purposes. Common stock does not provide any preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights. Common stockholders are not entitled to cumulative voting for purposes of electing members to the Board of Directors. Preferred Stock At September 30, 2021, the Company is authorized to issue 10,000,000 no 1,260,555 8 25.00 25.00 Conversion at Option of Holder 4.50 5.556 Dividends Preferred Stock 8 210,600 Common Stock. Public Offering and Conversion of Debt The registration statement for the Company’s initial public offering (the “Initial Public Offering”) became effective on August 28, 2020. On September 1, 2020, the Company closed on the Initial Public Offering of 2,031,705 6.00 265,005 12,190,200 10,789,000 In addition, upon closing of the Initial Public Offering, the Company issued to the underwriters warrants to purchase an aggregate of 88,335 shares of common stock exercisable at a per share price of $ 7.50 for a term of four years beginning on August 28, 2021. The fair value of these warrants is $ 167,400 . Also, upon closing of the Initial Public Offering, the Company issued to Olympic Views, LLC (“Olympic”), 82,826 442,000 55,000 6.00 2021 Common Stock Offering On January 15 and 20, 2021, the Company closed on an offering (the “Follow-On Offering”) of 9,200,000 3.00 1,200,000 27,600,000 25,101,000 In addition, upon closing of the Follow-On Offering the Company issued to the underwriters, warrants to purchase an aggregate of 400,000 shares of common stock exercisable at a per share price of $ 3.75 for a term of five years 453,800 . Preferred Stock Offering On June 11, 2021, the Company closed an offering (the “Preferred Stock Offering”) for 1,200,000 4,140,000 5.00 540,000 30,005,400 60,555 1,406,200 28,661,000 In addition, upon closing of the Preferred Stock Offering, the Company issued to the underwriters two warrants, including (i) warrants to purchase 12,000 36,000 5.00 The warrants issued to investors in this offering have an exercise price of $ 5.00 with a life of five years 3,701,600 , which was valued using the Black Scholes Model. (A) Options The following is a summary of the Company’s option activity: SCHEDULE OF STOCK OPTIONS ACTIVITY Options Weighted Average Exercise Price Outstanding – December 31, 2020 442,172 $ 2.53 Exercisable – December 31, 2020 219,085 $ 1.31 Granted 150,000 $ 3.23 Exercised (45,046 ) $ 0.40 Forfeited/Cancelled (33,114 ) $ 3.18 Outstanding – September 30, 2021 514,012 $ 2.88 Exercisable – September 30, 2021 363,361 $ 2.84 SCHEDULE OF STOCK OPTIONS OUTSTANDING AND EXERCISABLE Options Outstanding Options Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Number Exercisable Weighted Average Exercise Price $ 0.40 6.50 514,012 6.73 $ 2.88 363,361 $ 2.84 During the nine months ended September 30, 2021, the Company issued 150,000 2.76 3.41 Stock-Based Compensation. During the nine months ended September 30, 2021, the Company had 45,046 0.40 18,000 The Company recognized share-based compensation net of forfeitures related to options of $ 90,700 9,900 The Company recognized share-based compensation net of forfeitures related to options of $ 246,200 11,000 As of September 30, 2021, unrecognized share-based compensation was $ 170,300 The intrinsic value for outstanding and exercisable options as of September 30, 2021 was $ 333,400 306,500 (B) Warrants The following is a summary of the Company’s Common Stock Warrant activity: SCHEDULE OF WARRANTS ACTIVITY Warrants Weighted Average Exercise Price Outstanding – December 31, 2020 110,859 $ 6.06 Exercisable – December 31, 2020 22,524 $ 0.40 Granted 4,036,000 $ 4.88 Exercised - $ - Forfeited/Cancelled - $ - Outstanding – September 30, 2021 4,146,859 $ 4.91 Exercisable – September 30, 2021 3,710,859 $ 5.03 SCHEDULE OF WARRANTS OUTSTANDING AND EXERCISABLE Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Number Exercisable Weighted Average Exercise Price $ 0.40 7.50 4,146,859 4.66 $ 4.91 3,710,859 $ 5.03 The intrinsic value for outstanding and exercisable warrants as of September 30, 2021 was $ 43,900 43,900 The following is a summary of the Company’s Preferred Stock Warrant activity: SCHEDULE OF WARRANTS ACTIVITY Warrants Weighted Average Exercise Price Outstanding – December 31, 2020 - $ - Exercisable – December 31, 2020 - $ - Granted 12,000 $ 24.97 Exercised - $ - Forfeited/Cancelled - $ - Outstanding – September 30, 2021 12,000 $ 24.97 Exercisable – September 30, 2021 - $ - SCHEDULE OF WARRANTS OUTSTANDING AND EXERCISABLE Warrants Outstanding Warrants Exercisable Exercise Number Outstanding Weighted Weighted Number Exercisable Weighted $ 24.97 12,000 4.69 $ 24.97 12,000 $ 24.97 The intrinsic value for outstanding and exercisable warrants as of September 30, 2021 was $ 0 0 (C) Restricted Stock Plan The following is a summary of the Company’s restricted stock activity: SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY Restricted Stock Weighted Average Exercise Price Outstanding – December 31, 2020 34,000 $ 4.53 Exercisable – December 31, 2020 8,500 $ 4.53 Granted 70,000 $ 3.12 Exercised - $ - Forfeited/Cancelled - $ - Outstanding – September 30, 20201 104,000 $ 3.58 Exercisable – September 30, 2021 51,500 $ 4.05 The Company periodically grants restricted stock awards to the board of directors and certain employees pursuant to the 2020 Plan. These typically are awarded by the board of directors at one time and from time to time, to vest in four equal installments on the last day of a fiscal quarter. The Company recognized $ 93,100 0 170,100 0 163,800 |
SEGMENTS
SEGMENTS | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
SEGMENTS | 14. SEGMENTS The Company’s business is organized into four material reportable segments which aggregate 99% of revenue: 1) Homes 2) Completed lots 3) Entitled land 4) Fee build The reporting segments follow the same accounting policies used in the preparation of the Company’s consolidated financial statements. The following represents selected information for the Company’s reportable segments for the three months ended September 30, 2021 and 2020 and the nine months ended September 30, 2021 and 2020. Immaterial construction materials revenues and costs are included in the homes segment. SCHEDULE OF COMPANY’S REPORTABLE SEGMENT 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Revenue by segment Homes $ 3,929,300 $ 7,806,500 $ 14,277,700 $ 26,077,300 Completed lots 770,000 - 7,770,000 - Entitled land 10,440,000 - 19,750,000 - Fee Build 2,871,300 - 4,219,500 - Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 Cost of goods sold by segment Homes $ 3,498,000 $ 7,183,900 $ 12,378,200 $ 24,448,100 Completed lots 495,400 - 7,541,700 - Entitled land 4,492,600 - 11,449,400 - Fee Build 2,380,200 - 3,569,000 - Cost of Revenue $ 10,866,200 $ 7,183,900 $ 34,938,300 $ 24,448,100 Gross profit (loss) by segment Homes $ 431,300 $ 622,600 $ 1,899,500 $ 1,629,200 Completed lots 274,600 - 228,300 - Entitled land 5,947,400 - 8,300,600 - Fee Build 491,100 - 650,500 - Gross Profit $ 7,144,400 $ 622,600 $ 11,078,900 $ 1,629,200 |
UNCOMPLETED CONTRACTS
UNCOMPLETED CONTRACTS | 9 Months Ended |
Sep. 30, 2021 | |
Contractors [Abstract] | |
UNCOMPLETED CONTRACTS | 15. UNCOMPLETED CONTRACTS Costs, estimated earnings and billings on uncompleted contracts are summarized as follows at September 30, 2021 and December 31, 2020: SUMMARY OF COST, ESTIMATED EARNINGS AND BILLINGS ON UNCOMPLETED CONTRACTS September 30, 2021 December 31, 2020 Costs incurred on uncompleted contracts $ 3,717,000 $ - Estimated earnings 723,700 - Costs and estimated earnings on uncompleted contracts 4,440,700 - Billings to date 4,207,600 - Costs and estimated earnings in excess of billings on uncompleted contracts 624,000 - Costs and earnings in excess of billings on completed contracts (390,900) - Total $ 233,100 $ - Costs in excess of billings $ 624,000 $ - Billings in excess of cost (390,900) - Total $ 233,100 $ - The contract asset of $ 4,762,400 4,138,400 624,000 |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 9 Months Ended |
Sep. 30, 2021 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | 16. SUBSEQUENT EVENTS On August 8, 2021, the Company entered into a purchase and sale agreement to acquire property for the construction of 75 condominiums units located in Yelm, Washington for $ 3,250,000 On October 7, 2021, the Company closed an offering (the “Preferred Stock Offering”) for 2,400,000 13,800,000 2.97 1,380,000 33,076,700 On October 14, 2021, the Company entered into a purchase and sale agreement to sell 20 lots in Semiahmoo, Washington for $ 3,800,000 On October 27, 2021, the Company entered into a purchase and sale agreement to sell 24 lots in Semiahmoo, Washington for $ 4,800,000 On October 29, 2021, the Company’s Board of Directors (the “Board”) appointed Lance Brown as the Company’s Chief Financial Officer and Principal Financial Officer, effective as of November 1, 2021. Mr. O’Sullivan ceased to be the Company’s interim Chief Financial Officer effective as of the same date. Pursuant to Mr. Brown’s employment agreement, Mr. Brown receives a salary of $ 280,000 75,000 100,000 33,333 66,666 On November 1, 2021, the Company entered into a purchase and sale agreement to sell 30 lots in Horseshoe Bay, Texas for $ 6,045,500 , closing on or before December 21, 2021. On November 3, 2021, the Company entered into a purchase and sale agreement to sell 27 lots in Semiahmoo, Washington for $ 4,860,000 On November 5, 2021, the Company closed on the Underwriter’s exercise of its over-allotment option to purchase 360,000 Series A Preferred Shares from the Preferred Stock Offering and received net proceeds of $ 5,005,300 . On November 8, 2021, the Company entered into a purchase and sale agreement to sell one house in Bremerton, Washington for $ 739,000 |
NATURE OF OPERATIONS AND SUMM_2
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Nature of Operations | Nature of Operations The Company’s principal business activity involves acquiring raw land and developed lots for the purpose of building and selling single family and multi-family dwellings in Washington, California, Texas and Florida. It utilizes its heavy equipment resources to develop an inventory of finished lots and provide development infrastructure construction, on a contract basis, for other home builders. Single family construction and infrastructure construction contracts vary but are typically less than one year. On August 1, 2019, the Company changed its name from Harbor Custom Homes, Inc. to Harbor Custom Development, Inc. The Company became an effective filer with the Securities and Exchange Commission (“SEC”) and started trading on The Nasdaq Stock Market LLC (“Nasdaq”) on August 28, 2020. |
Principles of Consolidation | Principles of Consolidation The consolidated financial statements include the following subsidiaries of Harbor Custom Development, Inc. as of the reporting period ending dates as follows (all entities are formed as Washington LLCs): SCHEDULE OF STATEMENT OF SUBSIDIARIES Names Dates of Formation Attributable Interest September 30, December 31, 2021 2020 Saylor View Estates, LLC March 30, 2014 51 % 51 % Belfair Apartments, LLC December 3, 2019 100 % 100 % Pacific Ridge CMS, LLC May 24, 2021 100 % N/A Tanglewilde, LLC June 25, 2021 100 % 100 % HCDI FL CONDO LLC August 3, 2021 100 % N/A HCDI Mira, LLC August 30, 2021 100 % N/A HCDI Wyndstone, LLC September 15, 2021 100 % N/A All intercompany transactions and balances have been eliminated in consolidation. As of September 30, 2021 and December 31, 2020, the aggregate non-controlling interest was $( 1,291,600 1,289,900 |
Basis of Presentation | Basis of Presentation The unaudited financial information furnished herein reflects all adjustments, consisting solely of normal recurring items, which in the opinion of management are necessary to fairly state the financial position of the Company and the results of its operations for the periods presented. This report should be read in conjunction with the Company’s consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2020 filed with the SEC on March 31, 2021. The Company assumes that the users of the interim financial information herein have read or have access to the audited financial statements for the preceding fiscal year and the adequacy of additional disclosure needed for a fair presentation may be determined in that context. The condensed consolidated balance sheet at December 31, 2020 was derived from the audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The results of operations for the interim periods presented are not necessarily indicative of results for the year ending December 31, 2021. The Company’s Board of Directors and stockholders approved a 1-for-2.22 reverse split of the Company’s common stock, which was effected on April 15, 2020. The reverse split combined each 2.22 shares of the Company’s outstanding common stock into one share of common stock. as if it had occurred at the beginning of the earliest period presented. All numbers in these financial statements are rounded to the nearest $100. |
Use of Estimates | Use of Estimates Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could vary from the estimates that were used. |
Stock-Based Compensation | Stock-Based Compensation Effective as of November 19, 2018, the Company’s Board of Directors and stockholders approved and adopted the 2018 Incentive and Non-Statutory Stock Option Plan (the “2018 Plan”). The 2018 Plan allows the Administrator (as defined in the 2018 Plan), currently the Board of Directors, to determine the issuance of incentive stock options and non-qualified stock options to eligible employees and outside directors and consultants of the Company. The Company reserved 675,676 Effective as of December 3, 2020, the Company’s Board of Directors and stockholders approved and adopted the 2020 Restricted Stock Plan (the “2020 Plan”). The 2020 Plan allows the Administrator (currently the Compensation Committee) to determine the issuance of restricted stock to eligible officers, directors, and key employees. The Company reserved 700,000 The Company accounts for stock-based compensation in accordance with ASC Topic 718, “ Compensation – Stock Compensation” The Company recognizes all forms of share-based payments, including stock option grants, warrants and restricted stock grants, at their fair value on the grant date, which is based on the estimated number of awards that are ultimately expected to vest. Options and warrants are valued using a Black-Scholes option pricing model. Grants of share-based payment awards issued to non-employees for services rendered have been recorded at the fair value of the share-based payment. The grants are amortized on a straight-line basis over the requisite service periods, which is generally the vesting period. If an award is granted, but vesting does not occur, any previously recognized compensation expense is reversed in the period related to the termination of service. Stock-based compensation expenses are included in selling, general and administrative expenses in the consolidated statement of operations. For the nine months ended September 30, 2021 and 2020 when computing fair value of share-based payments, the Company has considered the following variables: SCHEDULE OF FAIR VALUE ASSUMPTIONS OF SHARE-BASED PAYMENTS September 30, 2021 September 30, 2020 Risk-free interest rate 0.23 1.11 % 0.47 1.46 % Exercise price $ 2.76 5.00 $ 2.22 7.50 Expected life of grants 2.50 6.5 2.99 6.00 Expected volatility of underlying stock 42.63 56.13 % 32.39 43.41 % Dividends 0 0 The expected term is computed using the “simplified” method as permitted under the provisions of ASC 718-10-S99. The Company uses the simplified method to calculate the expected term of share options and similar instruments as the Company does not have sufficient historical exercise data to provide a reasonable basis upon which to estimate the expected term. The share price as of the grant date was determined by an independent third party 409(a) valuation until the Company’s stock became publicly traded. Now the share price is the public trading price at the time of grant. Expected volatility is based on the historical stock price volatility of comparable companies’ common stock, as the stock does not have sufficient historical trading activity. Risk free interest rates were obtained from U.S. Treasury rates for the applicable periods. |
Earnings (Loss) Per Share | Earnings (Loss) Per Share Earnings (Loss) per share (“EPS”) is the amount of earnings attributable to each share of common stock. For convenience, the term is used to refer to either earnings or loss per share. EPS is computed pursuant to Section 260-10-45 of the Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”). Pursuant to ASC Paragraphs 260-10-45-10 through 260-10-45-16, basic EPS shall be computed by dividing income available to common stockholders (the numerator) by the weighted-average number of common shares outstanding (the denominator) during the period. Income available to common stockholders shall be computed by deducting both the dividends declared in the period on preferred stock (whether or not paid) and the dividends accumulated for the period on cumulative preferred stock (whether or not earned) from income from continuing operations (if that amount appears in the income statement) and also from net income. The computation of diluted EPS is similar to the computation of basic EPS except that the denominator is increased to include the number of additional common shares that would have been outstanding if the dilutive potential common shares had been issued during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) attributable to common stockholders per common share. SCHEDULE OF NET INCOME (LOSS) PER SHARE 2021 2020 2021 2020 For the Three Months For the Nine Months September 30, September 30, 2021 2020 2021 2020 Numerator: Net income (loss) attributable to common stockholders $ 3,077,000 $ (437,100 ) $ 2,458,800 $ (1,620,200 ) Effect of dilutive securities: - - - - Diluted net income (loss) $ 3,077,000 $ (437,100 ) $ 2,458,800 $ (1,620,200 ) Denominator: Weighted average common shares outstanding - basic 14,898,594 4,180,054 14,350,143 3,737,318 Dilutive securities (a): Options 140,957 - 145,884 - Warrants 19,367 - 19,683 - Weighted average common shares outstanding and assumed 15,058,918 4,180,054 14,515,710 3,737,318 conversion – diluted Basic net income (loss) per common share $ 0.21 $ (0.10 ) $ 0.17 $ (0.43 ) Diluted net income (loss) per common share $ 0.20 $ (0.10 ) $ 0.17 $ (0.43 ) (a) - Anti-dilutive securities excluded: 9,379,890 164,308 9,379,890 164,308 |
Fair Value of Financial Instruments | Fair Value of Financial Instruments For purpose of this disclosure, the fair value of a financial instrument is the amount at which the instrument could be exchanged in a current transaction between willing parties, other than in a forced sale or liquidation. The carrying amount of the Company’s short-term financial instruments approximates fair value due to the relatively short period to maturity for these instruments. |
Cash and Cash Equivalents | Cash and Cash Equivalents For purposes of the statement of cash flows, the Company considers all short-term debt securities purchased with a maturity of three months or less to be cash equivalents. There were no |
Restricted Cash | Restricted Cash On August 10, 2021, the Company entered a Letter of Credit (“LOC”) agreement with WaFd bank in the amount of $ 597,600 |
Accounts Receivable | Accounts Receivable Accounts receivables are reported at the amount the Company expects to collect from outstanding balances. The Company provides an allowance for doubtful accounts based upon a review of the outstanding accounts receivable, historical collection information and existing economic conditions. The Company determines if receivables are past due based on days outstanding, and amounts are written off when determined to be uncollectible by management. The allowance for doubtful accounts was $ 11,000 0 |
Property and Equipment and Depreciation | Property and Equipment and Depreciation Property and equipment are recorded at cost. Expenditures for major additions and betterments are capitalized. Maintenance and repairs are charged to operations as incurred. Depreciation is computed by the straight-line method (after considering their respective estimated residual values) over the estimated useful lives: SCHEDULE OF PROPERTY AND EQUIPMENT ESTIMATED USEFUL LIVES Construction Equipment 5 10 years Leasehold Improvements The lesser of 10 years or the remaining life of the lease Furniture and Fixtures 5 years Computers 3 years Vehicles 10 years |
Real Estate Assets | Real Estate Assets Real estate assets are recorded at cost, except when real estate assets are acquired that meet the definition of a business combination in accordance with FASB ASC 805, “Business Combinations,” where acquired assets are recorded at fair value. Interest, property taxes, insurance and other incremental costs (including salaries) directly related to a project are capitalized during the construction period of major facilities and land improvements. The capitalization period begins when activities to develop the parcel commence and ends when the asset constructed is completed. The capitalized costs are recorded as part of the asset to which they relate and are expensed when the underlying asset is sold. The Company capitalized interest from related party borrowings of $ 152,800 203,600 557,200 840,000 298,200 783,100 774,000 1,834,000 A property is classified as “held for sale” when all the following criteria for a plan of sale have been met: (1) Management, having the authority to approve the action, commits to a plan to sell the property; (2) The property is available for immediate sale in its present condition, subject only to terms that are usual and customary; (3) An active program to locate a buyer and other actions required to complete the plan to sell, have been initiated; (4) The sale of the property is probable and is expected to be completed within one year of the contract date; (5) The property is being actively marketed for sale at a price that is reasonable in relation to its current fair value; and (6) Actions necessary to complete the plan of sale indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. When all these criteria have been met, the property is classified as “held for sale.” In addition to the annual assessment of potential triggering events in accordance with ASC 360, the Company applies a fair value-based impairment test to the net book value assets on an annual basis and on an interim basis if certain events or circumstances indicate that an impairment loss may have occurred. As of September 30, 2021 and December 31, 2020, the Company did not have any projects that qualified for an impairment charge. |
Revenue and Cost Recognition | Revenue and Cost Recognition ASC 606, Revenue from Contracts with Customers (“ASC 606”), establishes principles for reporting information about the nature, amount, timing and uncertainty of revenue and cash flows arising from the entity’s contract to provide goods or services to customers. In accordance with ASC 606, revenue is recognized when a customer obtains control of the promised good or service. The amount of revenue recognized reflects the consideration to which the Company expects to be entitled to receive in exchange for these goods or services. The provision of ASC 606 includes a five-step process by which the Company determines revenue recognition, depicting the transfer of goods or services to customers in amounts reflecting the payment to which the Company expects to be entitled in exchange for those goods or services. ASC 606 requires the Company to apply the following steps: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to the performance obligations in the contract; and (5) recognize revenue when, or as, performance obligations are satisfied. A detailed breakdown of the five-step process for the revenue recognition of Entitled Land Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with a buyer to purchase the parcel of entitled land. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering entitled land to the customer, which are required to meet certain specifications outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. The parcel is a separate performance obligation for which the specific price is in the contract. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue when title is transferred. The Company does not have any further performance obligations once title is transferred. A detailed breakdown of the five-step process for the revenue recognition of Developed Lots Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with the buyer to purchase lots that have completed infrastructure. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering developed lots to the customer, which are required to meet certain specifications that are outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. All lots are a single performance obligation for the specific price in the contract. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue when title is transferred. The Company does not have any further performance obligations once title is transferred. A detailed breakdown of the five-step process for the revenue recognition of Fee Build Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with a customer to construct the required infrastructure so that houses can be developed on the lots. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering developed lots which are required to meet certain specifications that are outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. The nature of the industry involves a number of uncertainties that can affect the current state of the contract. Variable considerations are the estimates made due to a contract modification in the contractual service. Change orders, claims, extras, or back charges are common in contractual services activity as a form of variable consideration. If there is going to be a contract modification, judgment by management will need to be made to determine if the variable consideration is enforceable. The following factors are considered in determining if the variable consideration is enforceable: 1. The customer’s written approval of the scope of the change order; 2. Current contract language that indicates clear and enforceable entitlement relating to the change order; 3. Separate documentation for the change order costs that are identifiable and reasonable; and 4. The Company’s experience in negotiating change orders, especially as it relates to the specific type of contract and change order being evaluated. Once the Company receives a contract, it generates a budget of projected costs for the contract based on the contract price. If the scope of the contract during the contractual period needs to be modified, the Company files a change order. The Company does not continue to perform services until the change modification is agreed upon with documentation by both the Company and the customer. There are few times that claims, extras, or back charges are included in the contract. If there are multiple performance obligations to the contract, the costs must be allocated appropriately and consistently to each performance obligation. In the Company’s experience, usually only one performance obligation is stated per contract. If there are multiple services provided for one customer, the Company has a policy of splitting out the services over multiple contracts. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company uses the total costs incurred on the project relative to the total expected costs to satisfy the performance obligation. The input method involves measuring the resources consumed, labor hours expended, costs incurred, time lapsed, or machine hours used relative to the total expected inputs to the satisfaction of the performance obligation. Costs incurred prior to actual contract (i.e., design, engineering, procurement of material, etc.) should not be recognized as the Company does not have control of the good/service provided. When the estimate on a contract indicates a loss or claims against costs incurred reduce the likelihood of recoverability of such costs, the Company records the entire estimated loss in the period the loss becomes known. Project contracts typically provide for a schedule of billings or invoices to the customer based on the Company’s job to date percentage of completion of specific tasks inherent in the fulfillment of its performance obligation(s). The schedules for such billings usually do not precisely match the schedule on which costs are incurred. As a result, contract revenue recognized in the statement of operations can and usually does differ from amounts that can be billed or invoiced to the customer at any point during the contract. Amounts by which cumulative contract revenue recognized on a contract as of a given date exceed cumulative billings and unbilled receivables to the customer under the contract are reflected as a current asset in the Company’s balance sheet under the caption “Contract Asset” which is further disclosed in Note 15. Amounts by which cumulative billings to the customer under a contract as of a given date exceed cumulative contract revenue recognized on the contract are reflected as a current liability in the Company’s balance sheet under the caption “Billings in excess of costs and estimated earnings.” A detailed breakdown of the five-step process for the revenue recognition of Home Revenue is as follows: 1. Identify the contract with a customer. The Company signs an agreement with a home buyer to purchase a lot with a completed house. 2. Identify the performance obligations in the contract. Performance obligations of the Company include delivering a developed lot with a completed house to the customer, which is required to meet certain specifications that are outlined in the contract. 3. Determine the transaction price. The transaction price is fixed and specified in the contract. Any subsequent change orders or price changes are required to be approved by both parties. 4. Allocation of the transaction price to performance obligations in the contract. Each lot with a completed house is a separate performance obligation, for which the specific price in the contract is allocated. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The Company recognizes revenue when title is transferred. The Company does not have any further performance obligations once title is transferred. A detailed breakdown of the five-step process for the revenue recognition of Construction Materials sold to or received from contractors is as follows: 1. Identify the contract with a customer. There are no signed contracts. Each transaction is verbally agreed to with the customer. 2. Identify the performance obligations in the contract. The Company delivers or receives materials from customers based on the verbal agreement reached. 3. Determine the transaction price. The Company has a set price list for receiving approved fill materials to recycle or provides customers with a combination of said materials. 4. Allocation of the transaction price to performance obligations in the contract. There is only one performance obligation, which is to pick up or deliver the materials. The entire transaction price is therefore allocated to the performance obligation. 5. Recognize revenue when (or as) the entity satisfies a performance obligation. The performance obligation is fulfilled, and revenue is recognized when the materials have been received or delivered by the Company. Revenues from contracts with customers are summarized by category as follows for the three and nine months ended September 30: SCHEDULE OF REVENUES FROM CONTRACTS WITH CUSTOMERS 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Entitled Land $ 10,440,000 $ - $ 19,750,000 $ - Developed Lots 770,000 - 7,770,000 - Fee Build 2,871,300 - 4,219,500 - Homes 3,762,000 7,704,300 13,947,900 25,625,300 Construction Materials 167,300 102,200 329,800 452,000 Total Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 |
Disaggregation of Revenue from Contracts with Customers | Disaggregation of Revenue from Contracts with Customers The following table disaggregates the Company’s revenue based on the type of sale or service and the timing of satisfaction of performance obligations for the three and nine months ended September 30, 2021 and 2020: DISAGGREGATION OF REVENUE FROM CONTRACTS WITH CUSTOMERS 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Performance obligations satisfied at a point in time $ 15,139,300 $ 7,806,500 $ 41,797,700 $ 26,077,300 Performance obligations satisfied over time 2,871,300 - 4,219,500 - Total Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 |
Cost of Sales | Cost of Sales Land acquisition costs are allocated to each lot based on the size of the lot in relation to the size of the total project. Development cost and capitalized interest are allocated to lots sold based on the same criteria. Costs relating to the handling of recycled construction materials and converting items into usable construction materials for resale are charged to cost of sales as incurred. |
Advertising | Advertising Costs for designing, producing and communicating advertising are expensed as incurred. Advertising expense for the three months ended September 30, 2021 and 2020 was $ 15,600 0 Advertising expense for the nine months ended September 30, 2021 and 2020 was $ 27,600 8,500 |
Leases | Leases On January 1, 2019, the Company adopted ASU 2016-02 “ Leases” As part of the adoption the Company elected the practical expedients permitted under the transition guidance within the new standard, which among other things, allowed the Company to: 1. Not separate non-lease components from lease components and instead to account for each separate lease component and the non-lease components associated with that lease component as a single lease; 2. Not to apply the recognition requirements in ASC 842 to short-term leases; and 3. Not record a right of use asset or right of use liability for leases with an asset or liability balance that would be considered immaterial. |
Income Taxes | Income Taxes Deferred income tax assets and liabilities are determined based on the estimated future tax effects of net operating loss, credit carryforwards and temporary differences between the tax basis of assets and liabilities and their respective financial reporting amounts measured at the current enacted tax rates. Management applies the criteria established in the FASB released Accounting Standards Update No. 2019-12, Income taxes (Topic 740) (the Update) to determine if any valuation allowances are needed each year. The Company recognizes a tax benefit for an uncertain tax position only if it is more likely than not that the tax position will be sustained on examination by taxing authorities, based on the technical merits of the position. There are no uncertain tax positions as of September 30, 2021 and December 31, 2020. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements On December 18, 2019, the FASB released Accounting Standards Update No. 2019-12, Income taxes (Topic 740) (the Update). The Board issued this update as part of its initiative to reduce complexity in accounting standards. The Standard is effective for fiscal years beginning after December 15, 2020. The adoption did not have a material impact on the Company. In August 2020, the FASB issued Accounting Standards Update 2020-06, Debt — Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging — Contracts in Entity’s Own Equity (Subtopic 815-40) (“ASU 2020-06”) to simplify accounting for certain financial instruments. ASU 2020-06 eliminates the current models that require separation of beneficial conversion and cash conversion features from convertible instruments and simplifies the derivative scope exception guidance pertaining to equity classification of contracts in an entity’s own equity. The new standard also introduces additional disclosures for convertible debt and freestanding instruments that are indexed to and settled in an entity’s own equity. ASU 2020-06 amends the diluted earnings per share guidance, including the requirement to use the if-converted method for all convertible instruments. ASU 2020-06 is effective January 1, 2022 and should be applied on a full or modified retrospective basis, with early adoption permitted beginning on January 1, 2021. The Company adopted ASU 2020-06 on January 1, 2021. The adoption of ASU 2020-06 did not have an impact on the Company. On May 3, 2021, the FASB released Accounting Standards Update No. 2021-04, Compensation – Earning Per Share (Topic 260), Debt - Modifications and Extinguishments (subtopic 470-50), Compensation - Stock compensation (Topic 718), Contracts in Entity’s Own Equity (Subtopic 815-40) Issuer’s Accounting for Certain Modifications or Exchanges of Freestanding Equity-Classified Written Call Options. FASB issued this update to clarify and reduce diversity in an issuer’s accounting for modifications or exchanges of freestanding equity-classified written call options (for example warrants) that remain equity classified after modification or exchange. The Standard is effective for fiscal years beginning after December 15, 2021. The Company does not believe the adoption will have a material impact on the Company. |
Impairment of Long-Lived Assets | Impairment of Long-Lived Assets The Company reviews long-lived assets for impairment whenever events or circumstances indicate that the carrying value of such assets may not be fully recoverable. Impairment is present when the sum of estimated undiscounted future cash flow expected to result from use of the assets is less than carrying value. If impairment is present, the carrying value of the impaired asset is reduced to its fair value. Fair value is determined based on discounted cash flow or appraised values, depending on the nature of the assets. As of September 30, 2021 and December 31, 2020, there were no impairment losses recognized for long-lived assets. |
Offering Costs Associated with a Public Offering | Offering Costs Associated with a Public Offering The Company complies with the requirements of FASB ASC 340-10-S99-1 and SEC Staff Accounting Bulletin (“SAB”) Topic 5A — “ Expenses of Offering.” On January 15 and 20, 2021, the Company closed on a follow-on public offering and over-allotment option, respectively, of common stock. During 2020, the Company incurred approximately $ 65,100 of capitalizable costs associated with the follow-on public offering, which were netted against the proceeds received in 2021. These costs were capitalized as of December 31, 2020 and are shown on the Balance Sheet as Deferred Offering Costs. As of September 30, 2021, the Company incurred approximately $ 133,400 |
NATURE OF OPERATIONS AND SUMM_3
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SCHEDULE OF STATEMENT OF SUBSIDIARIES | The consolidated financial statements include the following subsidiaries of Harbor Custom Development, Inc. as of the reporting period ending dates as follows (all entities are formed as Washington LLCs): SCHEDULE OF STATEMENT OF SUBSIDIARIES Names Dates of Formation Attributable Interest September 30, December 31, 2021 2020 Saylor View Estates, LLC March 30, 2014 51 % 51 % Belfair Apartments, LLC December 3, 2019 100 % 100 % Pacific Ridge CMS, LLC May 24, 2021 100 % N/A Tanglewilde, LLC June 25, 2021 100 % 100 % HCDI FL CONDO LLC August 3, 2021 100 % N/A HCDI Mira, LLC August 30, 2021 100 % N/A HCDI Wyndstone, LLC September 15, 2021 100 % N/A |
SCHEDULE OF FAIR VALUE ASSUMPTIONS OF SHARE-BASED PAYMENTS | For the nine months ended September 30, 2021 and 2020 when computing fair value of share-based payments, the Company has considered the following variables: SCHEDULE OF FAIR VALUE ASSUMPTIONS OF SHARE-BASED PAYMENTS September 30, 2021 September 30, 2020 Risk-free interest rate 0.23 1.11 % 0.47 1.46 % Exercise price $ 2.76 5.00 $ 2.22 7.50 Expected life of grants 2.50 6.5 2.99 6.00 Expected volatility of underlying stock 42.63 56.13 % 32.39 43.41 % Dividends 0 0 |
SCHEDULE OF NET INCOME (LOSS) PER SHARE | The following table provides a reconciliation of the numerator and denominator used in computing basic and diluted net income (loss) attributable to common stockholders per common share. SCHEDULE OF NET INCOME (LOSS) PER SHARE 2021 2020 2021 2020 For the Three Months For the Nine Months September 30, September 30, 2021 2020 2021 2020 Numerator: Net income (loss) attributable to common stockholders $ 3,077,000 $ (437,100 ) $ 2,458,800 $ (1,620,200 ) Effect of dilutive securities: - - - - Diluted net income (loss) $ 3,077,000 $ (437,100 ) $ 2,458,800 $ (1,620,200 ) Denominator: Weighted average common shares outstanding - basic 14,898,594 4,180,054 14,350,143 3,737,318 Dilutive securities (a): Options 140,957 - 145,884 - Warrants 19,367 - 19,683 - Weighted average common shares outstanding and assumed 15,058,918 4,180,054 14,515,710 3,737,318 conversion – diluted Basic net income (loss) per common share $ 0.21 $ (0.10 ) $ 0.17 $ (0.43 ) Diluted net income (loss) per common share $ 0.20 $ (0.10 ) $ 0.17 $ (0.43 ) (a) - Anti-dilutive securities excluded: 9,379,890 164,308 9,379,890 164,308 |
SCHEDULE OF PROPERTY AND EQUIPMENT ESTIMATED USEFUL LIVES | SCHEDULE OF PROPERTY AND EQUIPMENT ESTIMATED USEFUL LIVES Construction Equipment 5 10 years Leasehold Improvements The lesser of 10 years or the remaining life of the lease Furniture and Fixtures 5 years Computers 3 years Vehicles 10 years |
SCHEDULE OF REVENUES FROM CONTRACTS WITH CUSTOMERS | Revenues from contracts with customers are summarized by category as follows for the three and nine months ended September 30: SCHEDULE OF REVENUES FROM CONTRACTS WITH CUSTOMERS 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Entitled Land $ 10,440,000 $ - $ 19,750,000 $ - Developed Lots 770,000 - 7,770,000 - Fee Build 2,871,300 - 4,219,500 - Homes 3,762,000 7,704,300 13,947,900 25,625,300 Construction Materials 167,300 102,200 329,800 452,000 Total Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 |
DISAGGREGATION OF REVENUE FROM CONTRACTS WITH CUSTOMERS | The following table disaggregates the Company’s revenue based on the type of sale or service and the timing of satisfaction of performance obligations for the three and nine months ended September 30, 2021 and 2020: DISAGGREGATION OF REVENUE FROM CONTRACTS WITH CUSTOMERS 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Performance obligations satisfied at a point in time $ 15,139,300 $ 7,806,500 $ 41,797,700 $ 26,077,300 Performance obligations satisfied over time 2,871,300 - 4,219,500 - Total Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 |
PROPERTY AND EQUIPMENT (Tables)
PROPERTY AND EQUIPMENT (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Property, Plant and Equipment [Abstract] | |
SCHEDULE OF PROPERTY AND EQUIPMENT | Property and equipment stated at cost, less accumulated depreciation and amortization, consisted of the following: SCHEDULE OF PROPERTY AND EQUIPMENT September 30, 2021 December 31, 2020 Machinery and Equipment $ 10,557,100 $ 8,908,000 Vehicles 71,800 73,500 Furniture and Fixtures 147,500 136,300 Leasehold Improvements 7,000 7,000 Total Fixed Assets 10,783,400 9,124,800 Less Accumulated Depreciation (1,650,500 ) (948,800 ) Fixed Assets, Net $ 9,132,900 $ 8,176,000 |
REAL ESTATE (Tables)
REAL ESTATE (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Real Estate [Abstract] | |
SCHEDULE OF REAL ESTATE | Real Estate consisted of the following components: SCHEDULE OF REAL ESTATE September 30, 2021 December 31, 2020 Land Held for Development $ 77,841,100 $ 9,532,800 Construction in Progress 23,620,300 9,042,700 Held for Sale 4,002,300 1,794,800 Real estate $ 105,463,700 $ 20,370,300 |
EQUIPMENT LOANS (Tables)
EQUIPMENT LOANS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Schedule Of Future Equipment Loan Maturities | |
SCHEDULE OF EQUIPMENT LOANS | Consists of the following: SCHEDULE OF EQUIPMENT LOANS September 30, 2021 December 31, 2020 Various notes payable to banks and financial institutions with interest rates varying from 0.00 13.89 400 11,600 through 2026 $ 5,731,800 $ 5,595,500 Book value of collateralized equipment: $ 7,840,900 $ 6,475,600 |
SCHEDULE OF FUTURE EQUIPMENT LOAN MATURITIES | SCHEDULE OF FUTURE EQUIPMENT LOAN MATURITIES 2022 $ 1,876,900 2023 1,787,700 2024 1,652,200 2025 410,200 2026 4,800 Equipment Loans $ 5,731,800 |
STOCKHOLDERS_ EQUITY (Tables)
STOCKHOLDERS’ EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
SCHEDULE OF STOCK OPTIONS ACTIVITY | The following is a summary of the Company’s option activity: SCHEDULE OF STOCK OPTIONS ACTIVITY Options Weighted Average Exercise Price Outstanding – December 31, 2020 442,172 $ 2.53 Exercisable – December 31, 2020 219,085 $ 1.31 Granted 150,000 $ 3.23 Exercised (45,046 ) $ 0.40 Forfeited/Cancelled (33,114 ) $ 3.18 Outstanding – September 30, 2021 514,012 $ 2.88 Exercisable – September 30, 2021 363,361 $ 2.84 |
SCHEDULE OF STOCK OPTIONS OUTSTANDING AND EXERCISABLE | SCHEDULE OF STOCK OPTIONS OUTSTANDING AND EXERCISABLE Options Outstanding Options Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Number Exercisable Weighted Average Exercise Price $ 0.40 6.50 514,012 6.73 $ 2.88 363,361 $ 2.84 |
SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY | The following is a summary of the Company’s restricted stock activity: SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY Restricted Stock Weighted Average Exercise Price Outstanding – December 31, 2020 34,000 $ 4.53 Exercisable – December 31, 2020 8,500 $ 4.53 Granted 70,000 $ 3.12 Exercised - $ - Forfeited/Cancelled - $ - Outstanding – September 30, 20201 104,000 $ 3.58 Exercisable – September 30, 2021 51,500 $ 4.05 |
Common Stock Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
SCHEDULE OF WARRANTS ACTIVITY | The following is a summary of the Company’s Common Stock Warrant activity: SCHEDULE OF WARRANTS ACTIVITY Warrants Weighted Average Exercise Price Outstanding – December 31, 2020 110,859 $ 6.06 Exercisable – December 31, 2020 22,524 $ 0.40 Granted 4,036,000 $ 4.88 Exercised - $ - Forfeited/Cancelled - $ - Outstanding – September 30, 2021 4,146,859 $ 4.91 Exercisable – September 30, 2021 3,710,859 $ 5.03 |
SCHEDULE OF WARRANTS OUTSTANDING AND EXERCISABLE | SCHEDULE OF WARRANTS OUTSTANDING AND EXERCISABLE Warrants Outstanding Warrants Exercisable Exercise Price Number Outstanding Weighted Average Remaining Contractual Life (in years) Weighted Average Exercise Number Exercisable Weighted Average Exercise Price $ 0.40 7.50 4,146,859 4.66 $ 4.91 3,710,859 $ 5.03 |
Preferred Stock Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
SCHEDULE OF WARRANTS ACTIVITY | The following is a summary of the Company’s Preferred Stock Warrant activity: SCHEDULE OF WARRANTS ACTIVITY Warrants Weighted Average Exercise Price Outstanding – December 31, 2020 - $ - Exercisable – December 31, 2020 - $ - Granted 12,000 $ 24.97 Exercised - $ - Forfeited/Cancelled - $ - Outstanding – September 30, 2021 12,000 $ 24.97 Exercisable – September 30, 2021 - $ - |
SCHEDULE OF WARRANTS OUTSTANDING AND EXERCISABLE | SCHEDULE OF WARRANTS OUTSTANDING AND EXERCISABLE Warrants Outstanding Warrants Exercisable Exercise Number Outstanding Weighted Weighted Number Exercisable Weighted $ 24.97 12,000 4.69 $ 24.97 12,000 $ 24.97 |
SEGMENTS (Tables)
SEGMENTS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Segment Reporting [Abstract] | |
SCHEDULE OF COMPANY’S REPORTABLE SEGMENT | SCHEDULE OF COMPANY’S REPORTABLE SEGMENT 2021 2020 2021 2020 For the Three Months Ended For the Nine Months Ended September 30, September 30, 2021 2020 2021 2020 Revenue by segment Homes $ 3,929,300 $ 7,806,500 $ 14,277,700 $ 26,077,300 Completed lots 770,000 - 7,770,000 - Entitled land 10,440,000 - 19,750,000 - Fee Build 2,871,300 - 4,219,500 - Revenue $ 18,010,600 $ 7,806,500 $ 46,017,200 $ 26,077,300 Cost of goods sold by segment Homes $ 3,498,000 $ 7,183,900 $ 12,378,200 $ 24,448,100 Completed lots 495,400 - 7,541,700 - Entitled land 4,492,600 - 11,449,400 - Fee Build 2,380,200 - 3,569,000 - Cost of Revenue $ 10,866,200 $ 7,183,900 $ 34,938,300 $ 24,448,100 Gross profit (loss) by segment Homes $ 431,300 $ 622,600 $ 1,899,500 $ 1,629,200 Completed lots 274,600 - 228,300 - Entitled land 5,947,400 - 8,300,600 - Fee Build 491,100 - 650,500 - Gross Profit $ 7,144,400 $ 622,600 $ 11,078,900 $ 1,629,200 |
UNCOMPLETED CONTRACTS (Tables)
UNCOMPLETED CONTRACTS (Tables) | 9 Months Ended |
Sep. 30, 2021 | |
Contractors [Abstract] | |
SUMMARY OF COST, ESTIMATED EARNINGS AND BILLINGS ON UNCOMPLETED CONTRACTS | Costs, estimated earnings and billings on uncompleted contracts are summarized as follows at September 30, 2021 and December 31, 2020: SUMMARY OF COST, ESTIMATED EARNINGS AND BILLINGS ON UNCOMPLETED CONTRACTS September 30, 2021 December 31, 2020 Costs incurred on uncompleted contracts $ 3,717,000 $ - Estimated earnings 723,700 - Costs and estimated earnings on uncompleted contracts 4,440,700 - Billings to date 4,207,600 - Costs and estimated earnings in excess of billings on uncompleted contracts 624,000 - Costs and earnings in excess of billings on completed contracts (390,900) - Total $ 233,100 $ - Costs in excess of billings $ 624,000 $ - Billings in excess of cost (390,900) - Total $ 233,100 $ - |
SCHEDULE OF STATEMENT OF SUBSID
SCHEDULE OF STATEMENT OF SUBSIDIARIES (Details) | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Saylor View Estates, LLC [Member] | ||
Dates of Formation | Mar. 30, 2014 | |
Attributable Interest | 51.00% | 51.00% |
Belfair Apartments, LLC [Member] | ||
Dates of Formation | Dec. 3, 2019 | |
Attributable Interest | 100.00% | 100.00% |
Pacific Ridge CMS LLC [Member] | ||
Dates of Formation | May 24, 2021 | |
Attributable Interest | 100.00% | |
Tangle Wilde LLC [Member] | ||
Dates of Formation | Jun. 25, 2021 | |
Attributable Interest | 100.00% | |
HCD IFL CONDO LLC [Member] | ||
Dates of Formation | Aug. 3, 2021 | |
Attributable Interest | 100.00% | |
HCDI Mira LLC [Member] | ||
Dates of Formation | Aug. 30, 2021 | |
Attributable Interest | 100.00% | |
HCDI Wyndstone LLC [Member] | ||
Dates of Formation | Sep. 15, 2021 | |
Attributable Interest | 100.00% |
SCHEDULE OF FAIR VALUE ASSUMPTI
SCHEDULE OF FAIR VALUE ASSUMPTIONS OF SHARE-BASED PAYMENTS (Details) - $ / shares | 9 Months Ended | |
Sep. 30, 2021 | Sep. 30, 2020 | |
Dividends | 0.00% | 0.00% |
Minimum [Member] | ||
Risk-free interest rate | 0.23% | 0.47% |
Exercise Price | $ 2.76 | $ 2.22 |
Expected life of grants | 2 years 6 months | 2 years 11 months 26 days |
Expected volatility of underlying stock | 42.63% | 32.39% |
Maximum [Member] | ||
Risk-free interest rate | 1.11% | 1.46% |
Exercise Price | $ 5 | $ 7.50 |
Expected life of grants | 6 years 6 months | 6 years |
Expected volatility of underlying stock | 56.13% | 43.41% |
SCHEDULE OF NET INCOME (LOSS) P
SCHEDULE OF NET INCOME (LOSS) PER SHARE (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||||
Net income (loss) attributable to common stockholders | $ 3,077,000 | $ (437,100) | $ 2,458,800 | $ (1,620,200) |
Effect of dilutive securities: | ||||
Diluted net income (loss) | $ 3,077,000 | $ (437,100) | $ 2,458,800 | $ (1,620,200) |
Weighted average common shares outstanding - basic | 14,898,594 | 4,180,054 | 14,350,143 | 3,737,318 |
Options | 140,957 | 145,884 | ||
Warrants | 19,367 | 19,683 | ||
Weighted average common shares outstanding and assumed | 15,058,918 | 4,180,054 | 14,515,710 | 3,737,318 |
Basic net income (loss) per common share | $ 0.21 | $ (0.10) | $ 0.17 | $ (0.43) |
Diluted net income (loss) per common share | $ 0.20 | $ (0.10) | $ 0.17 | $ (0.43) |
(a) - Anti-dilutive securities excluded: | 9,379,890 | 164,308 | 9,379,890 | 164,308 |
SCHEDULE OF PROPERTY AND EQUIPM
SCHEDULE OF PROPERTY AND EQUIPMENT ESTIMATED USEFUL LIVES (Details) | 9 Months Ended |
Sep. 30, 2021 | |
Construction Equipment [Member] | Minimum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment estimated useful life | 5 years |
Construction Equipment [Member] | Maximum [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment estimated useful life | 10 years |
Leasehold Improvements [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment useful lives | The lesser of 10 years or the remaining life of the lease |
Furniture and Fixtures [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment estimated useful life | 5 years |
Computers [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment estimated useful life | 3 years |
Vehicles [Member] | |
Property, Plant and Equipment [Line Items] | |
Property and equipment estimated useful life | 10 years |
SCHEDULE OF REVENUES FROM CONTR
SCHEDULE OF REVENUES FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total Revenue | $ 18,010,600 | $ 7,806,500 | $ 46,017,200 | $ 26,077,300 |
Entitled Land [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total Revenue | 10,440,000 | 19,750,000 | ||
Developed Lots [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total Revenue | 770,000 | 7,770,000 | ||
Fee Build [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total Revenue | 2,871,300 | 4,219,500 | ||
Home Building [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total Revenue | 3,762,000 | 7,704,300 | 13,947,900 | 25,625,300 |
Construction Materials [Member] | ||||
Collaborative Arrangement and Arrangement Other than Collaborative [Line Items] | ||||
Total Revenue | $ 167,300 | $ 102,200 | $ 329,800 | $ 452,000 |
DISAGGREGATION OF REVENUE FROM
DISAGGREGATION OF REVENUE FROM CONTRACTS WITH CUSTOMERS (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | $ 18,010,600 | $ 7,806,500 | $ 46,017,200 | $ 26,077,300 |
Transferred at Point in Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | 15,139,300 | 7,806,500 | 41,797,700 | 26,077,300 |
Transferred over Time [Member] | ||||
Disaggregation of Revenue [Line Items] | ||||
Total Revenue | $ 2,871,300 | $ 4,219,500 |
NATURE OF OPERATIONS AND SUMM_4
NATURE OF OPERATIONS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Aug. 10, 2021 | Dec. 31, 2020 | Dec. 03, 2020 | Nov. 19, 2018 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Non-controlling interest | $ 1,291,600 | $ 1,291,600 | $ 1,289,900 | |||||
Reverse stock split | 1-for-2.22 reverse split of the Company’s common stock, which was effected on April 15, 2020. The reverse split combined each 2.22 shares of the Company’s outstanding common stock into one share of common stock. | |||||||
Number of financial statements, description | All numbers in these financial statements are rounded to the nearest $100. | |||||||
Cash equivalents | 0 | $ 0 | 0 | |||||
Restricted Cash | $ 597,600 | |||||||
Allowance for doubtful accounts | 11,000 | 11,000 | 0 | |||||
Capitalized interest from related party borrowings | 152,800 | $ 203,600 | 557,200 | $ 840,000 | ||||
Capitalized interest from third-party borrowings | 298,200 | 783,100 | 774,000 | 1,834,000 | ||||
Advertising expense | 15,600 | $ 0 | 27,600 | $ 8,500 | ||||
Offering costs | $ 133,400 | $ 133,400 | $ 65,100 | |||||
2018 Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Reserved shares of common stock issuance | 675,676 | |||||||
2020 Plan [Member] | ||||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||||||
Reserved shares of common stock issuance | 700,000 |
CONCENTRATION, RISKS, AND UNC_2
CONCENTRATION, RISKS, AND UNCERTAINTIES (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | |
Concentration Risk [Line Items] | |||||
Uninsured cash | $ 4,264,400 | $ 4,264,400 | $ 2,146,000 | ||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Completed Lots [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 90.00% | 0.00% | |||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Five Customers [Member] | Homes [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 19.00% | ||||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Customer One [Member] | Completed Lots [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 38.00% | ||||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Customer Two [Member] | Completed Lots [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 38.00% | ||||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Customer Three [Member] | Completed Lots [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 24.00% | ||||
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Lennar NorthwestInc [Member] | Entitled Land [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 100.00% | 0.00% | 100.00% | 0.00% | |
Customer Concentration Risk [Member] | Revenue Benchmark [Member] | Lennar NorthwestInc [Member] | Fee Build [Member] | |||||
Concentration Risk [Line Items] | |||||
Concentration Risk, Percentage | 100.00% | 0.00% | 100.00% | 0.00% |
SCHEDULE OF PROPERTY AND EQUI_2
SCHEDULE OF PROPERTY AND EQUIPMENT (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Property, Plant and Equipment [Line Items] | ||
Total Fixed Assets | $ 10,783,400 | $ 9,124,800 |
Less Accumulated Depreciation | (1,650,500) | (948,800) |
Fixed Assets, Net | 9,132,900 | 8,176,000 |
Machinery and Equipment [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Fixed Assets | 10,557,100 | 8,908,000 |
Vehicles [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Fixed Assets | 71,800 | 73,500 |
Furniture and Fixtures [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Fixed Assets | 147,500 | 136,300 |
Leasehold Improvements [Member] | ||
Property, Plant and Equipment [Line Items] | ||
Total Fixed Assets | $ 7,000 | $ 7,000 |
PROPERTY AND EQUIPMENT (Details
PROPERTY AND EQUIPMENT (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Property, Plant and Equipment [Abstract] | ||||
Depreciation expense | $ 300,400 | $ 133,400 | $ 783,500 | $ 419,200 |
SCHEDULE OF REAL ESTATE (Detail
SCHEDULE OF REAL ESTATE (Details) - USD ($) | Sep. 30, 2021 | Dec. 30, 2020 |
Real Estate [Abstract] | ||
Land Held for Development | $ 77,841,100 | $ 9,532,800 |
Construction in Progress | 23,620,300 | 9,042,700 |
Held for Sale | 4,002,300 | 1,794,800 |
Real estate | $ 105,463,700 | $ 20,370,300 |
SCHEDULE OF EQUIPMENT LOANS (De
SCHEDULE OF EQUIPMENT LOANS (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Line of Credit Facility [Line Items] | ||
Various notes payable to banks and financial institutions with interest rates varying from 0.00% to 13.89%, collateralized by equipment with monthly payments ranging from $400 to $11,600 through 2026: | $ 5,731,800 | $ 5,595,500 |
Book value of collateralized equipment: | $ 7,840,900 | $ 6,475,600 |
Bank [Member] | Minimum [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt interest rate | 0.00% | |
Bank [Member] | Maximum [Member] | ||
Line of Credit Facility [Line Items] | ||
Debt interest rate | 13.89% |
SCHEDULE OF EQUIPMENT LOANS (_2
SCHEDULE OF EQUIPMENT LOANS (Details) (Parenthetical) - Bank [Member] | 9 Months Ended |
Sep. 30, 2021USD ($) | |
Line of Credit Facility [Line Items] | |
Debt maturity date, description | through 2026 |
Minimum [Member] | |
Line of Credit Facility [Line Items] | |
Debt interest rate | 0.00% |
Monthly payments | $ 400 |
Maximum [Member] | |
Line of Credit Facility [Line Items] | |
Debt interest rate | 13.89% |
Monthly payments | $ 11,600 |
SCHEDULE OF FUTURE EQUIPMENT LO
SCHEDULE OF FUTURE EQUIPMENT LOAN MATURITIES (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Schedule Of Future Equipment Loan Maturities | ||
2022 | $ 1,876,900 | |
2023 | 1,787,700 | |
2024 | 1,652,200 | |
2025 | 410,200 | |
2026 | 4,800 | |
Equipment Loans | $ 5,731,800 | $ 5,595,500 |
CONSTRUCTION LOANS (Details Nar
CONSTRUCTION LOANS (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Short-term Debt [Line Items] | ||
Debt instrument face amount | $ 39,560,700 | $ 10,092,500 |
Book value of collateralized real estate | $ 105,463,700 | $ 20,370,300 |
Construction Loans [Member] | ||
Short-term Debt [Line Items] | ||
Debt instrument term | 1 year | |
Construction Loans [Member] | Minimum [Member] | ||
Short-term Debt [Line Items] | ||
Debt instrument interest rate percentage | 5.00% | |
Construction Loans [Member] | Maximum [Member] | ||
Short-term Debt [Line Items] | ||
Debt instrument interest rate percentage | 39.00% |
LINE OF CREDIT (Details Narrati
LINE OF CREDIT (Details Narrative) - USD ($) | Sep. 30, 2021 | Aug. 10, 2021 |
Line Of Credit | ||
Long-term Line of Credit | $ 597,600 | |
Borrowings against line of credit | $ 0 | |
Line of credit outstanding amount | $ 0 |
NOTE PAYABLE D&O INSURANCE (Det
NOTE PAYABLE D&O INSURANCE (Details Narrative) - USD ($) | Sep. 01, 2021 | Aug. 28, 2020 | Sep. 01, 2021 | Sep. 30, 2021 | Dec. 31, 2020 |
Defined Benefit Plan Disclosure [Line Items] | |||||
Note Payable D&O Insurance | $ 1,284,000 | $ 741,200 | |||
D & O Insurance [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Payment to acquire insurance | $ 1,541,400 | $ 1,531,900 | |||
Down payment for insurance | 131,100 | 306,400 | |||
Insurance payable | $ 1,410,300 | $ 1,225,500 | $ 1,410,300 | ||
Debt instrument interest rate | 4.42% | 4.74% | |||
Note Payable D&O Insurance | 0 | 741,200 | |||
Debt instrument term | 10 months | ||||
D & O Insurance on September 1, 2021 [Member] | |||||
Defined Benefit Plan Disclosure [Line Items] | |||||
Note Payable D&O Insurance | $ 1,284,000 | $ 0 |
NOTE PAYABLE PPP (Details Narra
NOTE PAYABLE PPP (Details Narrative) - USD ($) | Feb. 01, 2021 | Nov. 09, 2020 | Sep. 30, 2021 | Dec. 31, 2020 | Apr. 11, 2020 |
Line of Credit Facility [Line Items] | |||||
Debt instrument face amount | $ 39,560,700 | $ 10,092,500 | |||
Paycheck Protection Program Loan [Member] | SBA [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument face amount | $ 0 | $ 19,300 | |||
Term Note [Member] | Paycheck Protection Program Loan [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt instrument face amount | $ 582,800 | ||||
Interest rate percentage | 100.00% | 1.00% | |||
Term Note [Member] | Paycheck Protection Program Loan [Member] | SBA [Member] | |||||
Line of Credit Facility [Line Items] | |||||
Debt forgiveness | $ 10,000 | $ 562,300 |
DEFINED CONTRIBUTION PLAN (Deta
DEFINED CONTRIBUTION PLAN (Details Narrative) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
401 (k) [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Employer contribution to defined contribution plan | $ 24,900 | $ 0 | $ 74,500 | $ 0 |
COMMITMENTS (Details Narrative)
COMMITMENTS (Details Narrative) | Aug. 08, 2021USD ($) | Aug. 06, 2021USD ($) | Sep. 17, 2020USD ($)ft² | Jun. 15, 2020USD ($) | Sep. 30, 2021USD ($) | Sep. 30, 2020USD ($) |
Product Liability Contingency [Line Items] | ||||||
Payment to acquire property, plant and equipment | $ 378,100 | $ 401,100 | ||||
Purchase and Sale Agreement [Member] | Port Orchard, Washington [Member] | ||||||
Product Liability Contingency [Line Items] | ||||||
Area of land | ft² | 9.6 | |||||
Payment to acquire property, plant and equipment | $ 1,440,000 | |||||
Purchase and Sale Agreement [Member] | East Bremerton, Washington [Member] | ||||||
Product Liability Contingency [Line Items] | ||||||
Payment to acquire property, plant and equipment | $ 2,040,000 | |||||
Purchase and Sale Agreement [Member] | Yelm Washington [Member] | ||||||
Product Liability Contingency [Line Items] | ||||||
Payment to acquire property, plant and equipment | $ 3,250,000 | $ 3,250,000 |
RELATED PARTY TRANSACTIONS (Det
RELATED PARTY TRANSACTIONS (Details Narrative) - USD ($) | Sep. 02, 2020 | May 31, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Dec. 31, 2020 | Aug. 13, 2020 | Apr. 19, 2020 | Apr. 11, 2020 |
Related Party Transaction [Line Items] | ||||||||||
Debt instrument face amount | $ 39,560,700 | $ 39,560,700 | $ 10,092,500 | |||||||
Interest expense | 115,100 | $ 163,900 | 298,500 | $ 254,200 | ||||||
Payment to acquire property | 378,100 | 401,100 | ||||||||
Curb Funding, LLC [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Debt instrument interest rate percentage | 12.00% | |||||||||
Debt discounts | 0 | 1,100 | ||||||||
Outstanding loan balances | 0 | 0 | 51,800 | |||||||
Debt instrument face amount | $ 0 | $ 0 | 3,500 | |||||||
Olympic Views, LLC [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Payment to acquire property | $ 3,430,000 | |||||||||
Olympic Views, LLC [Member] | Chief Executive Officer and President [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Ownership percentage | 50.00% | |||||||||
SGRE, LLC [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Ownership percentage | 100.00% | 100.00% | ||||||||
Percentage of commission payable | 25.00% | 25.00% | ||||||||
Commission expense | $ 8,200 | 0 | ||||||||
Commission expense | $ 17,100 | 209,100 | 72,800 | 209,100 | ||||||
Richard Schmidktke [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Fees payable | 0 | 500 | ||||||||
Accounting expenses | $ 500 | 6,000 | $ 1,000 | 40,300 | ||||||
Construction Loans [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Debt instrument term | 1 year | |||||||||
Construction Loans [Member] | Minimum [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Debt instrument interest rate percentage | 5.00% | 5.00% | ||||||||
Construction Loans [Member] | Maximum [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Debt instrument interest rate percentage | 39.00% | 39.00% | ||||||||
Construction Loans [Member] | Sound Equity, LLC [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Debt instrument term | 1 year | |||||||||
Loan origination fees | $ 0 | 178,500 | $ 552,800 | 283,300 | ||||||
Debt discounts | 292,600 | 202,500 | ||||||||
Prepaid interest | 0 | 296,100 | 1,431,100 | 840,000 | ||||||
Prepaid interest reserve | 1,123,700 | 1,123,700 | 466,600 | |||||||
Outstanding loan balances | 12,792,300 | 12,792,300 | 6,489,900 | |||||||
Interest expense | $ 2,800 | 0 | ||||||||
Interest expense | $ 0 | $ 8,900 | ||||||||
Construction Loans [Member] | Sound Equity, LLC [Member] | Minimum [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Debt instrument interest rate percentage | 8.49% | 8.49% | ||||||||
Construction Loans [Member] | Sound Equity, LLC [Member] | Maximum [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Debt instrument interest rate percentage | 12.00% | 12.00% | ||||||||
Construction Loans [Member] | Olympic Views, LLC [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Outstanding loan balances | $ 0 | $ 0 | $ 0 | |||||||
Debt instrument face amount | $ 442,000 | |||||||||
Accrued interest | $ 55,000 | |||||||||
Share issued price per share | $ 6 | |||||||||
Stock issued during period shares | 82,826 | |||||||||
Paycheck Protection Program Loan [Member] | Term Note [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Interest rate percentage | 100.00% | 100.00% | 1.00% | |||||||
Debt instrument face amount | $ 582,800 | |||||||||
Real Estate [Member] | Sound Equity, LLC [Member] | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Interest expense | $ 0 | $ 41,900 |
SCHEDULE OF STOCK OPTIONS ACTIV
SCHEDULE OF STOCK OPTIONS ACTIVITY (Details) - $ / shares | 3 Months Ended | 9 Months Ended |
Mar. 31, 2021 | Sep. 30, 2021 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options, Exercised | (45,046) | |
Weighted Average Exercise Price, Outstanding, Ending balance | $ 2.88 | |
Weighted Average Exercise Price, Exercisable, Ending balance | $ 2.84 | |
Options [Member] | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Options, Outstanding, Beginning balance | 442,172 | 442,172 |
Weighted Average Exercise Price, Outstanding, Beginning balance | $ 2.53 | $ 2.53 |
Options Exercisable, Beginning balance | 219,085 | 219,085 |
Weighted Average Exercise Price, Exercisable | $ 1.31 | $ 1.31 |
Options, Granted | 150,000 | |
Weighted Average Exercise Price, Granted | $ 3.23 | |
Options, Exercised | (45,046) | |
Weighted Average Exercise Price, Exercised | $ 0.40 | |
Options, Forfeited/Cancelled | (33,114) | |
Weighted Average Exercise Price, Forfeited/Cancelled | $ 3.18 | |
Options, Outstanding, Ending balance | 514,012 | |
Weighted Average Exercise Price, Outstanding, Ending balance | $ 2.88 | |
Options Exercisable, , Ending balance | 363,361 | |
Weighted Average Exercise Price, Exercisable, Ending balance | $ 2.84 |
SCHEDULE OF STOCK OPTIONS OUTST
SCHEDULE OF STOCK OPTIONS OUTSTANDING AND EXERCISABLE (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Number of Option Outstanding | shares | 514,012 |
Weighed Average Remaining Contractual Life (in years) | 6 years 8 months 23 days |
Weighted Average Exercise Price, Outstanding, Ending balance | $ 2.88 |
Number of Option Exercisable | shares | 363,361 |
Weighted Average Exercise Price, Exercisable | $ 2.84 |
Minimum [Member] | |
Exercise Price | 0.40 |
Weighted Average Exercise Price, Exercisable | 2.76 |
Maximum [Member] | |
Exercise Price | 6.50 |
Weighted Average Exercise Price, Exercisable | $ 3.41 |
SCHEDULE OF WARRANTS ACTIVITY (
SCHEDULE OF WARRANTS ACTIVITY (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Common Stock Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Outstanding, Beginning | shares | 110,859 |
Weighted Average Exercise Price, Outstanding, Beginning | $ / shares | $ 6.06 |
Warrants Exercisable, Beginning | shares | 22,524 |
Weighted Average Exercise Price, Exercisable Beginning | $ / shares | $ 0.40 |
Warrants, Granted | shares | 4,036,000 |
Weighted Average Exercise Price, Granted | $ / shares | $ 4.88 |
Warrants, Exercised | shares | |
Weighted Average Exercise Price, Exercised | $ / shares | |
Warrants, Forfeited/Cancelled | shares | |
Weighted Average Exercise Price, Forfeited/Cancelled | $ / shares | |
Outstanding, Ending | shares | 4,146,859 |
Weighted Average Exercise Price, Outstanding, Ending | $ / shares | $ 4.91 |
Warrants Exercisable, Ending | shares | 3,710,859 |
Weighted Average Exercise Price, Exercisable, Ending | $ / shares | $ 5.03 |
Preferred Stock Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Outstanding, Beginning | shares | |
Weighted Average Exercise Price, Outstanding, Beginning | $ / shares | |
Warrants Exercisable, Beginning | shares | |
Weighted Average Exercise Price, Exercisable Beginning | $ / shares | |
Warrants, Granted | shares | 12,000 |
Weighted Average Exercise Price, Granted | $ / shares | $ 24.97 |
Warrants, Exercised | shares | |
Weighted Average Exercise Price, Exercised | $ / shares | |
Warrants, Forfeited/Cancelled | shares | |
Weighted Average Exercise Price, Forfeited/Cancelled | $ / shares | |
Outstanding, Ending | shares | 12,000 |
Weighted Average Exercise Price, Outstanding, Ending | $ / shares | $ 24.97 |
Warrants Exercisable, Ending | shares | |
Weighted Average Exercise Price, Exercisable, Ending | $ / shares |
SCHEDULE OF WARRANTS OUTSTANDIN
SCHEDULE OF WARRANTS OUTSTANDING AND EXERCISABLE (Details) | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Number of Warrants Outstanding | shares | 514,012 |
Common Stock Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Number of Warrants Outstanding | shares | 4,146,859 |
Weighed Average Remaining Contractual Life (in years) | 4 years 7 months 28 days |
Weighted Average Exercise Price | $ 4.91 |
Number of Warrants Exercisable | shares | 3,710,859 |
Warrants Exercisable, Weighted Average Exercise Price | $ 5.03 |
Common Stock Warrant [Member] | Minimum [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Weighted Average Exercise Price, Exercisable | 0.40 |
Common Stock Warrant [Member] | Maximum [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Weighted Average Exercise Price, Exercisable | 7.50 |
Preferred Stock Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Weighted Average Exercise Price, Exercisable | $ 24.97 |
Number of Warrants Outstanding | shares | 12,000 |
Weighed Average Remaining Contractual Life (in years) | 4 years 8 months 8 days |
Number of Warrants Exercisable | shares | 12,000 |
Warrants Exercisable, Weighted Average Exercise Price | $ 24.97 |
Warrant [Member] | |
Accumulated Other Comprehensive Income (Loss) [Line Items] | |
Weighted Average Exercise Price | $ 24.97 |
SCHEDULE OF RESTRICTED STOCK UN
SCHEDULE OF RESTRICTED STOCK UNIT ACTIVITY (Details) - Restricted Stock Units (RSUs) [Member] | 9 Months Ended |
Sep. 30, 2021$ / sharesshares | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding, Beginning | shares | 34,000 |
Weighted Average Exercise Price, Outstanding, Beginning | $ / shares | $ 4.53 |
RSU, exercisable, Beginning | shares | 8,500 |
Weighted Average Exercise Price, Exercisable, Beginning | $ / shares | $ 4.53 |
RSU, Granted | shares | 70,000 |
Weighted Average Exercise Price, Granted | $ / shares | $ 3.12 |
RSU, Exercised | shares | |
Weighted Average Exercise Price, Exercised | $ / shares | |
RSU, Forfeited/Cancelled | shares | |
Weighted Average Exercise Price, Forfeited/Cancelled | $ / shares | |
Outstanding, Ending | shares | 104,000 |
Weighted Average Exercise Price, Outstanding, Ending | $ / shares | $ 3.58 |
RSU, Exercisable, Ending | shares | 51,500 |
Weighted Average Exercise Price, Exercisable, Ending | $ / shares | $ 4.05 |
STOCKHOLDERS_ EQUITY (Details N
STOCKHOLDERS’ EQUITY (Details Narrative) - USD ($) | Jun. 11, 2021 | Jan. 20, 2021 | Jan. 15, 2021 | Jan. 11, 2021 | Sep. 01, 2020 | Sep. 30, 2021 | Jun. 30, 2021 | Mar. 31, 2021 | Sep. 30, 2020 | Jun. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | Oct. 07, 2021 | Dec. 31, 2020 |
Class of Stock [Line Items] | ||||||||||||||
Common stock, shares authorized | 50,000,000 | 50,000,000 | 50,000,000 | |||||||||||
Common stock, shares issued | 14,922,094 | 14,922,094 | 5,636,548 | |||||||||||
Common stock, shares outstanding | 14,922,094 | 14,922,094 | 5,636,548 | |||||||||||
Preferred stock, shares authorized | 10,000,000 | 10,000,000 | 10,000,000 | |||||||||||
Preferred stock, no par value | $ 0 | $ 0 | $ 0 | |||||||||||
Preferred stock, shares issued | 1,260,555 | 1,260,555 | 0 | |||||||||||
Preferred stock, liquidation preference | $ 25 | $ 25 | ||||||||||||
Preferred stock accrued dividend | $ 210,600 | $ 210,600 | ||||||||||||
Net proceeds from issuance of common stock | 25,101,000 | $ 10,789,100 | ||||||||||||
Stock issuance cost | $ 68,300 | |||||||||||||
Options exercise price | $ 2.84 | $ 2.84 | ||||||||||||
Stock options exercised | 45,046 | |||||||||||||
Share based compensation, net of forfeitures | $ 185,200 | $ 115,800 | $ 115,100 | $ 9,900 | $ 1,100 | |||||||||
Share based compensation expense | $ 170,300 | |||||||||||||
Restricted Stock Units (RSUs) [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Share based compensation expense | 93,100 | 0 | 170,100 | 0 | ||||||||||
Unrecognized compensation expense | 163,800 | 163,800 | ||||||||||||
Equity Option [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Share based compensation, net of forfeitures | 90,700 | $ 9,900 | 246,200 | $ 11,000 | ||||||||||
Intrinsic value for outstanding options | 333,400 | 333,400 | ||||||||||||
Intrinsic value exercisable options | $ 306,500 | $ 306,500 | ||||||||||||
Minimum [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Options exercise price | $ 2.76 | $ 2.76 | ||||||||||||
Stock options exercised for former employees | 0.40 | |||||||||||||
Maximum [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Options exercise price | $ 3.41 | 3.41 | ||||||||||||
Stock options exercised for former employees | $ 6.50 | |||||||||||||
Employees [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Stock options issued | 150,000 | |||||||||||||
Former Employee [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Stock options exercised | 45,046 | |||||||||||||
Stock options exercised for former employees | $ 0.40 | |||||||||||||
Shares exercised as additional paid in capital | $ 18,000 | |||||||||||||
IPO [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Stock issued during period shares | 2,031,705 | |||||||||||||
Share issued price per share | $ 6 | |||||||||||||
Warrants to purchase common stock | 265,005 | |||||||||||||
Gross proceeds from offering | $ 12,190,200 | |||||||||||||
Net proceeds from issuance of common stock | $ 10,789,000 | |||||||||||||
Number to warrants to underwriter | 88,335 | 88,335 | ||||||||||||
Exercises price per share | $ 7.50 | $ 7.50 | ||||||||||||
Warrants and Rights Outstanding, Term | 4 years | 4 years | ||||||||||||
[custom:FairValueOfWarrants-0] | $ 167,400 | $ 167,400 | ||||||||||||
IPO [Member] | Olympic Views, LLC [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Share issued price per share | $ 6 | $ 6 | ||||||||||||
Shares issued on conversion of debt | 82,826 | |||||||||||||
Value of shares issued on conversion of debt | $ 442,000 | |||||||||||||
Accrued interest | $ 55,000 | $ 55,000 | ||||||||||||
Follow-on Offering [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Stock issued during period shares | 9,200,000 | 9,200,000 | ||||||||||||
Share issued price per share | $ 3 | $ 3 | ||||||||||||
Warrants to purchase common stock | 1,200,000 | 1,200,000 | ||||||||||||
Gross proceeds from offering | $ 27,600,000 | $ 27,600,000 | ||||||||||||
Net proceeds from issuance of common stock | $ 25,101,000 | $ 25,101,000 | ||||||||||||
Number to warrants to underwriter | 400,000 | 400,000 | ||||||||||||
Exercises price per share | $ 3.75 | $ 3.75 | ||||||||||||
Warrants and Rights Outstanding, Term | 5 years | 5 years | ||||||||||||
[custom:FairValueOfWarrants-0] | $ 453,800 | $ 453,800 | ||||||||||||
Preferred Stock Offering [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Stock issued during period shares | 1,200,000 | 60,555 | ||||||||||||
Share issued price per share | $ 5 | |||||||||||||
Warrants to purchase common stock | 4,140,000 | |||||||||||||
Gross proceeds from offering | $ 1,406,200 | |||||||||||||
Number to warrants to underwriter | 540,000 | |||||||||||||
Gross proceeds from stock offering | $ 30,005,400 | |||||||||||||
Stock issuance cost | $ 28,661,000 | |||||||||||||
Common Stock [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Conversion price per share | $ 4.50 | $ 4.50 | ||||||||||||
Conversion of shares | 5.556 | 5.556 | ||||||||||||
Stock issued during period shares | 9,200,000 | 2,031,705 | ||||||||||||
Warrant One [Member] | Preferred Stock Offering [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Number to warrants to underwriter | 12,000 | 12,000 | ||||||||||||
Warrant Two [Member] | Preferred Stock Offering [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Number to warrants to underwriter | 36,000 | 36,000 | ||||||||||||
Exercises price per share | $ 5 | $ 5 | ||||||||||||
Warrant [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Warrants and Rights Outstanding | $ 3,701,600 | $ 3,701,600 | ||||||||||||
Warrant [Member] | Investor [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Exercises price per share | $ 5 | $ 5 | ||||||||||||
Warrant term | 5 years | |||||||||||||
Common Stock Warrant [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Intrinsic value for outstanding options | $ 43,900 | $ 43,900 | ||||||||||||
Preferred Warrant [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Intrinsic value for outstanding options | 0 | 0 | ||||||||||||
Intrinsic value exercisable options | $ 0 | $ 0 | ||||||||||||
Series A Preferred Stock [Member] | ||||||||||||||
Class of Stock [Line Items] | ||||||||||||||
Preferred stock, shares issued | 1,260,555 | 1,260,555 | ||||||||||||
Preferred stock, dividend rate | 8.00% | |||||||||||||
Preferred stock, liquidation preference | $ 25 | $ 25 | ||||||||||||
Number to warrants to underwriter | 13,800,000 |
SCHEDULE OF COMPANY_S REPORTABL
SCHEDULE OF COMPANY’S REPORTABLE SEGMENT (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2021 | Sep. 30, 2020 | Sep. 30, 2021 | Sep. 30, 2020 | |
Segment Reporting Information [Line Items] | ||||
Revenue | $ 18,010,600 | $ 7,806,500 | $ 46,017,200 | $ 26,077,300 |
Cost of Revenue | 10,866,200 | 7,183,900 | 34,938,300 | 24,448,100 |
Gross Profit | 7,144,400 | 622,600 | 11,078,900 | 1,629,200 |
Homes [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 3,929,300 | 7,806,500 | 14,277,700 | 26,077,300 |
Cost of Revenue | 3,498,000 | 7,183,900 | 12,378,200 | 24,448,100 |
Gross Profit | 431,300 | 622,600 | 1,899,500 | 1,629,200 |
Completed Lots [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 770,000 | 7,770,000 | ||
Cost of Revenue | 495,400 | 7,541,700 | ||
Gross Profit | 274,600 | 228,300 | ||
Entitled Land [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 10,440,000 | 19,750,000 | ||
Cost of Revenue | 4,492,600 | 11,449,400 | ||
Gross Profit | 5,947,400 | 8,300,600 | ||
Fee Build [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenue | 2,871,300 | 4,219,500 | ||
Cost of Revenue | 2,380,200 | 3,569,000 | ||
Gross Profit | $ 491,100 | $ 650,500 |
SUMMARY OF COST, ESTIMATED EARN
SUMMARY OF COST, ESTIMATED EARNINGS AND BILLINGS ON UNCOMPLETED CONTRACTS (Details) - USD ($) | Sep. 30, 2021 | Dec. 31, 2020 |
Contractors [Abstract] | ||
Costs incurred on uncompleted contracts | $ 3,717,000 | |
Estimated earnings | 723,700 | |
Costs and estimated earnings on uncompleted contracts | 4,440,700 | |
Billings to date | 4,207,600 | |
Costs and estimated earnings in excess of billings on uncompleted contracts | 624,000 | |
Costs and earnings in excess of billings on completed contracts | (390,900) | |
Total | 233,100 | |
Costs in excess of billings | 624,000 | |
Billings in excess of cost | (390,900) | |
Total | $ 233,100 |
UNCOMPLETED CONTRACTS (Details
UNCOMPLETED CONTRACTS (Details Narrative) - USD ($) | 9 Months Ended | |
Sep. 30, 2021 | Dec. 31, 2020 | |
Contractors [Abstract] | ||
Contract Assets, net | $ 4,762,400 | |
Uncollected billings | 4,138,400 | |
Costs in excess of billings | $ 624,000 |
SUBSEQUENT EVENTS (Details Narr
SUBSEQUENT EVENTS (Details Narrative) - USD ($) | Nov. 08, 2021 | Nov. 05, 2021 | Nov. 03, 2021 | Nov. 01, 2021 | Oct. 29, 2021 | Oct. 29, 2021 | Oct. 14, 2021 | Oct. 07, 2021 | Oct. 07, 2021 | Aug. 08, 2021 | Aug. 06, 2021 | Oct. 27, 2021 | Sep. 30, 2021 | Sep. 30, 2020 |
Payment to acquire property, plant and equipment | $ 378,100 | $ 401,100 | ||||||||||||
Proceeds from preferred stock offering | $ 28,661,000 | |||||||||||||
2020 Plan [Member] | ||||||||||||||
Options grants in period | 100,000 | |||||||||||||
Options, expected to vest | 33,333 | 33,333 | ||||||||||||
Expected to vest | 66,666 | |||||||||||||
Chief Financial Officer [Member] | ||||||||||||||
Salary | $ 280,000 | |||||||||||||
Series A Preferred Stock [Member] | ||||||||||||||
Number of warrant exercise | 13,800,000 | 13,800,000 | ||||||||||||
Proceeds from preferred stock offering | $ 5,005,300 | $ 33,076,700 | ||||||||||||
Preferred Class A [Member] | ||||||||||||||
Share-based Compensation Arrangement by Share-based Payment Award, Shares Purchased for Award | 360,000 | |||||||||||||
Over-Allotment Option [Member] | ||||||||||||||
Stock issued during period shares | 2,400,000 | |||||||||||||
Number of warrant exercise | 1,380,000 | 1,380,000 | ||||||||||||
Warrant exercise price per share | $ 2.97 | $ 2.97 | ||||||||||||
Purchase and Sale Agreement [Member] | Yelm Washington [Member] | ||||||||||||||
Payment to acquire property, plant and equipment | $ 3,250,000 | $ 3,250,000 | ||||||||||||
Purchase and Sale Agreement [Member] | Semiahmoo Washington [Member] | ||||||||||||||
Payment to acquire property, plant and equipment | $ 4,860,000 | $ 3,800,000 | $ 4,800,000 | |||||||||||
Purchase and Sale Agreement [Member] | Horseshoebay Texas [Member] | ||||||||||||||
Payment to acquire property, plant and equipment | $ 6,045,500 | |||||||||||||
Purchase and Sale Agreement [Member] | Bremerton Washington [Member] | ||||||||||||||
Payment to acquire property, plant and equipment | $ 739,000 |