Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2019 | Nov. 05, 2019 | |
Document and Entity Information | ||
Entity Registrant Name | CIM Commercial Trust Corp | |
Entity Central Index Key | 0000908311 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2019 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | true | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 14,602,149 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q3 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 | |
ASSETS | |||
Investments in real estate, net | $ 505,966 | $ 1,040,937 | |
Cash and cash equivalents | 14,600 | 54,931 | |
Restricted cash | 11,507 | 22,512 | |
Loans receivable, net | 71,576 | 83,248 | |
Accounts receivable, net | 5,121 | 6,640 | |
Deferred rent receivable and charges, net | 34,316 | 84,230 | |
Other intangible assets, net | 7,740 | 9,531 | |
Other assets | 9,026 | 18,197 | |
Assets held for sale, net (Note 3) | 0 | 22,175 | |
TOTAL ASSETS | 659,852 | 1,342,401 | |
LIABILITIES: | |||
Debt, net | 227,727 | 588,671 | |
Accounts payable and accrued expenses | 16,960 | 41,598 | |
Intangible liabilities, net | 1,562 | 2,872 | |
Due to related parties | 6,740 | 10,951 | |
Other liabilities | 9,046 | 16,535 | |
Liabilities associated with assets held for sale, net (Note 3) | 0 | 28,766 | |
Total liabilities | 262,035 | 689,393 | |
COMMITMENTS AND CONTINGENCIES (Note 15) | |||
REDEEMABLE PREFERRED STOCK: Series A, $0.001 par value; 36,000,000 shares authorized; 1,642,763 and 1,641,563 shares issued and outstanding, respectively, at September 30, 2019 and 1,566,386 and 1,565,346 shares issued and outstanding, respectively, at December 31, 2018; liquidation preference of $25.00 per share, subject to adjustment | 37,216 | 35,733 | |
EQUITY: | |||
Common stock, $0.001 and $0.003 par value; 900,000,000 shares authorized; 14,602,149 and 14,598,357 shares issued and outstanding at September 30, 2019 and December 31, 2018, respectively | [1] | 15 | 44 |
Additional paid-in capital | 788,342 | 790,354 | |
Accumulated other comprehensive income | 0 | 1,806 | |
Distributions in excess of earnings | (718,493) | (436,883) | |
Total stockholders' equity | 360,102 | 616,438 | |
Noncontrolling interests | 499 | 837 | |
Total equity | 360,601 | 617,275 | |
TOTAL LIABILITIES, REDEEMABLE PREFERRED STOCK, AND EQUITY | 659,852 | 1,342,401 | |
Series A Cumulative Preferred Stock | |||
EQUITY: | |||
Preferred stock | 60,987 | 31,866 | |
Series L Preferred Stock | |||
EQUITY: | |||
Preferred stock | $ 229,251 | $ 229,251 | |
[1] | All share and per share amounts have been adjusted to give retroactive effect to the one-for-three reverse stock split of our common stock effected on September 3, 2019. |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Sep. 30, 2019 | Dec. 31, 2018 |
Common stock, par value (in usd per share) | $ 0.001 | $ 0.003 |
Common stock, shares authorized (in shares) | 900,000,000 | 900,000,000 |
Common stock, shares issued (in shares) | 14,602,149 | 14,598,357 |
Common stock, shares outstanding (in shares) | 14,602,149 | 14,598,357 |
Series A Preferred Stock | ||
Preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 36,000,000 | 36,000,000 |
Preferred stock, shares issued (in shares) | 1,642,763 | 1,566,386 |
Preferred stock, shares outstanding (in shares) | 1,641,563 | 1,565,346 |
Preferred stock, liquidation preference per share (in usd per share) | $ 25 | $ 25 |
Series A Cumulative Preferred Stock | ||
Preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 36,000,000 | 36,000,000 |
Preferred stock, shares issued (in shares) | 2,462,104 | 1,287,169 |
Preferred stock, shares outstanding (in shares) | 2,450,417 | 1,281,804 |
Preferred stock, liquidation preference per share (in usd per share) | $ 25 | $ 25 |
Series L Preferred Stock | ||
Preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized (in shares) | 9,000,000 | 9,000,000 |
Preferred stock, shares issued (in shares) | 8,080,740 | 8,080,740 |
Preferred stock, shares outstanding (in shares) | 8,080,740 | 8,080,740 |
Preferred stock, liquidation preference per share (in usd per share) | $ 28.37 | $ 28.37 |
Consolidated Statements of Oper
Consolidated Statements of Operations - USD ($) shares in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
REVENUES: | |||||
Rental and other property income | $ 17,306,000 | $ 36,606,000 | $ 73,306,000 | $ 109,575,000 | |
Hotel income | 7,734,000 | 7,715,000 | 27,087,000 | 27,564,000 | |
Interest and other income | 4,175,000 | 3,286,000 | 12,955,000 | 10,306,000 | |
REVENUES | 29,215,000 | 47,607,000 | 113,348,000 | 147,445,000 | |
EXPENSES: | |||||
Rental and other property operating | 13,286,000 | 20,405,000 | 49,197,000 | 59,086,000 | |
Asset management and other fees to related parties | 3,981,000 | 6,121,000 | 14,155,000 | 18,475,000 | |
Interest | 2,403,000 | 6,965,000 | 8,998,000 | 20,409,000 | |
General and administrative | 1,384,000 | 1,205,000 | 4,793,000 | 6,496,000 | |
Transaction costs | 340,000 | 15,000 | 600,000 | 359,000 | |
Depreciation and amortization | 5,180,000 | 13,310,000 | 21,995,000 | 39,783,000 | |
Loss on early extinguishment of debt (Note 7) | 0 | 0 | 29,982,000 | 0 | |
Impairment of real estate (Note 3) | 0 | 0 | 69,000,000 | 0 | |
EXPENSES | 26,574,000 | 48,021,000 | 198,720,000 | 144,608,000 | |
Gain on sale of real estate (Note 3) | 302,000 | 0 | 433,104,000 | 0 | |
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES | 2,943,000 | (414,000) | 347,732,000 | 2,837,000 | |
Provision for income taxes | 87,000 | 115,000 | 686,000 | 795,000 | |
NET INCOME (LOSS) | 2,856,000 | (529,000) | 347,046,000 | 2,042,000 | |
Net (income) loss attributable to noncontrolling interests | (8,000) | 1,000 | 165,000 | (15,000) | |
NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY | 2,848,000 | (528,000) | 347,211,000 | 2,027,000 | |
Redeemable preferred stock dividends declared or accumulated (Note 10) | (4,470,000) | (3,921,000) | (12,934,000) | (11,380,000) | |
Redeemable preferred stock redemptions (Note 10) | 0 | (8,000) | |||
Redeemable preferred stock redemptions (Note 10) | 1,000 | 3,000 | |||
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS | $ (1,622,000) | $ (4,448,000) | $ 334,269,000 | $ (9,350,000) | |
NET (LOSS) INCOME ATTRIBUTABLE TO COMMON STOCKHOLDERS PER SHARE: (1) | |||||
Basic (in usd per share) | [1] | $ (0.11) | $ (0.30) | $ 22.90 | $ (0.64) |
Diluted (in usd per share) | [1] | $ (0.11) | $ (0.30) | $ 21.24 | $ (0.64) |
WEIGHTED AVERAGE SHARES OF COMMON STOCK OUTSTANDING: (1) | |||||
Basic (in shares) | [1] | 14,598 | 14,598 | 14,598 | 14,597 |
Diluted (in shares) | [1] | 14,599 | 14,598 | 15,825 | 14,597 |
[1] | All share and per share amounts have been adjusted to give retroactive effect to the one-for-three reverse stock split of our common stock effected on September 3, 2019. |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Statement of Comprehensive Income [Abstract] | ||||
NET INCOME (LOSS) | $ 2,856 | $ (529) | $ 347,046 | $ 2,042 |
Other comprehensive income (loss): cash flow hedges | 0 | (1,806) | ||
Other comprehensive income (loss): cash flow hedges | (183) | 1,407 | ||
COMPREHENSIVE INCOME (LOSS) | 2,856 | (712) | 345,240 | 3,449 |
Comprehensive (income) loss attributable to noncontrolling interests | (8) | 1 | 165 | (15) |
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY | $ 2,848 | $ (711) | $ 345,405 | $ 3,434 |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) $ in Thousands | Total | Common Stock | Additional Paid-in Capital | Accumulated Other Comprehensive Income | Distributions in Excess of Earnings | Non-controlling Interests | Series A Preferred StockPreferred Stock | Series L Preferred StockPreferred Stock | |
Beginning balance (in shares) at Dec. 31, 2017 | 14,594,979 | 60,592 | 8,080,740 | ||||||
Beginning balance at Dec. 31, 2017 | $ 626,705 | $ 44 | $ 792,631 | $ 1,631 | $ (399,250) | $ 890 | $ 1,508 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Stock-based compensation expense | 38 | 38 | |||||||
Common dividends | [1] | (5,473) | (5,473) | ||||||
Issuance of Series A Preferred Warrants | 17 | 17 | |||||||
Dividends to holders of Series A Preferred Stock ($0.34375 per share) | (493) | (493) | |||||||
Reclassification of Series A Preferred Stock to permanent equity (in shares) | 82,841 | ||||||||
Reclassification of Series A Preferred Stock to permanent equity | 1,885 | (175) | $ 2,060 | ||||||
Redemption of Series A Preferred Stock | 1 | 1 | |||||||
Other comprehensive income (loss) | 1,183 | 1,183 | |||||||
NET INCOME (LOSS) | 622 | 618 | 4 | ||||||
Ending balance (in shares) at Mar. 31, 2018 | 14,594,979 | 143,433 | 8,080,740 | ||||||
Ending balance at Mar. 31, 2018 | 624,485 | $ 44 | 792,512 | 2,814 | (404,598) | 894 | $ 3,568 | $ 229,251 | |
Beginning balance (in shares) at Dec. 31, 2017 | 14,594,979 | 60,592 | 8,080,740 | ||||||
Beginning balance at Dec. 31, 2017 | 626,705 | $ 44 | 792,631 | 1,631 | (399,250) | 890 | $ 1,508 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Reclassification of Series A Preferred Stock to permanent equity | 11,517 | ||||||||
Other comprehensive income (loss) | 1,407 | ||||||||
NET INCOME (LOSS) | 2,042 | ||||||||
Ending balance (in shares) at Sep. 30, 2018 | 14,598,357 | 566,176 | 8,080,740 | ||||||
Ending balance at Sep. 30, 2018 | 623,438 | $ 44 | 791,773 | 3,038 | (415,568) | 838 | $ 14,062 | $ 229,251 | |
Beginning balance (in shares) at Mar. 31, 2018 | 14,594,979 | 143,433 | 8,080,740 | ||||||
Beginning balance at Mar. 31, 2018 | 624,485 | $ 44 | 792,512 | 2,814 | (404,598) | 894 | $ 3,568 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Distributions to noncontrolling interests | (67) | (67) | |||||||
Stock-based compensation expense (in shares) | 3,378 | ||||||||
Stock-based compensation expense | 48 | 48 | |||||||
Common dividends | [1] | (5,474) | (5,474) | ||||||
Issuance of Series A Preferred Warrants | 23 | 23 | |||||||
Dividends to holders of Series A Preferred Stock ($0.34375 per share) | (662) | (662) | |||||||
Reclassification of Series A Preferred Stock to permanent equity (in shares) | 164,077 | ||||||||
Reclassification of Series A Preferred Stock to permanent equity | 3,730 | (339) | $ 4,069 | ||||||
Redemption of Series A Preferred Stock | 1 | 1 | |||||||
Other comprehensive income (loss) | 407 | 407 | |||||||
NET INCOME (LOSS) | 1,949 | 1,937 | 12 | ||||||
Ending balance (in shares) at Jun. 30, 2018 | 14,598,357 | 307,510 | 8,080,740 | ||||||
Ending balance at Jun. 30, 2018 | 624,440 | $ 44 | 792,245 | 3,221 | (408,797) | 839 | $ 7,637 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Stock-based compensation expense | 38 | 38 | |||||||
Common dividends | [1] | (5,474) | (5,474) | ||||||
Issuance of Series A Preferred Warrants | 22 | 22 | |||||||
Dividends to holders of Series A Preferred Stock ($0.34375 per share) | (769) | (769) | |||||||
Reclassification of Series A Preferred Stock to permanent equity (in shares) | 259,066 | ||||||||
Reclassification of Series A Preferred Stock to permanent equity | 5,902 | (533) | $ 6,435 | ||||||
Redemption of Series A Preferred Stock (in shares) | (400) | ||||||||
Redemption of Series A Preferred Stock | (9) | 1 | $ (10) | ||||||
Other comprehensive income (loss) | (183) | (183) | |||||||
NET INCOME (LOSS) | (529) | (528) | (1) | ||||||
Ending balance (in shares) at Sep. 30, 2018 | 14,598,357 | 566,176 | 8,080,740 | ||||||
Ending balance at Sep. 30, 2018 | 623,438 | $ 44 | 791,773 | 3,038 | (415,568) | 838 | $ 14,062 | $ 229,251 | |
Beginning balance (in shares) at Dec. 31, 2018 | 14,598,357 | 1,281,804 | 8,080,740 | ||||||
Beginning balance at Dec. 31, 2018 | 617,275 | $ 44 | 790,354 | 1,806 | (436,883) | 837 | $ 31,866 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Stock-based compensation expense | 38 | 38 | |||||||
Common dividends | [1] | (5,474) | (5,474) | ||||||
Issuance of Series A Preferred Warrants | 9 | 9 | |||||||
Dividends to holders of Series A Preferred Stock ($0.34375 per share) | (1,010) | (1,010) | |||||||
Reclassification of Series A Preferred Stock to permanent equity (in shares) | 389,577 | ||||||||
Reclassification of Series A Preferred Stock to permanent equity | 8,890 | (822) | $ 9,712 | ||||||
Redemption of Series A Preferred Stock (in shares) | (1,500) | ||||||||
Redemption of Series A Preferred Stock | (38) | (1) | $ (37) | ||||||
Other comprehensive income (loss) | (1,806) | (1,806) | |||||||
NET INCOME (LOSS) | 291,623 | 291,797 | (174) | ||||||
Ending balance (in shares) at Mar. 31, 2019 | 14,598,357 | 1,669,881 | 8,080,740 | ||||||
Ending balance at Mar. 31, 2019 | 909,507 | $ 44 | 789,578 | 0 | (151,570) | 663 | $ 41,541 | $ 229,251 | |
Beginning balance (in shares) at Dec. 31, 2018 | 14,598,357 | 1,281,804 | 8,080,740 | ||||||
Beginning balance at Dec. 31, 2018 | 617,275 | $ 44 | 790,354 | 1,806 | (436,883) | 837 | $ 31,866 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Extinguishment of noncontrolling interest | (113) | ||||||||
Reclassification of Series A Preferred Stock to permanent equity | 26,729 | ||||||||
Other comprehensive income (loss) | (1,806) | ||||||||
NET INCOME (LOSS) | 347,046 | ||||||||
Ending balance (in shares) at Sep. 30, 2019 | 14,602,149 | 2,450,417 | 8,080,740 | ||||||
Ending balance at Sep. 30, 2019 | 360,601 | $ 15 | 788,342 | 0 | (718,493) | 499 | $ 60,987 | $ 229,251 | |
Beginning balance (in shares) at Mar. 31, 2019 | 14,598,357 | 1,669,881 | 8,080,740 | ||||||
Beginning balance at Mar. 31, 2019 | 909,507 | $ 44 | 789,578 | 0 | (151,570) | 663 | $ 41,541 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Distributions to noncontrolling interests | (47) | (47) | |||||||
Stock-based compensation expense (in shares) | 3,556 | ||||||||
Stock-based compensation expense | 44 | 44 | |||||||
Common dividends | [1] | (5,476) | (5,476) | ||||||
Issuance of Series A Preferred Warrants | 31 | 31 | |||||||
Dividends to holders of Series A Preferred Stock ($0.34375 per share) | (1,150) | (1,150) | |||||||
Reclassification of Series A Preferred Stock to permanent equity (in shares) | 474,462 | ||||||||
Reclassification of Series A Preferred Stock to permanent equity | 10,825 | (1,002) | $ 11,827 | ||||||
Redemption of Series A Preferred Stock (in shares) | (1,667) | ||||||||
Redemption of Series A Preferred Stock | (41) | 4 | (4) | $ (41) | |||||
NET INCOME (LOSS) | 52,567 | 52,566 | 1 | ||||||
Ending balance (in shares) at Jun. 30, 2019 | 14,601,913 | 2,142,676 | 8,080,740 | ||||||
Ending balance at Jun. 30, 2019 | 966,260 | $ 44 | 788,655 | 0 | (105,634) | 617 | $ 53,327 | $ 229,251 | |
Increase (Decrease) in Stockholders' Equity | |||||||||
Contributions to noncontrolling interests | 455 | 455 | |||||||
Distributions to noncontrolling interests | (468) | (468) | |||||||
Extinguishment of noncontrolling interest | (113) | (113) | |||||||
Stock-based compensation expense (in shares) | 324 | ||||||||
Stock-based compensation expense | 56 | 56 | |||||||
Retirement of fractional shares | (1) | (1) | |||||||
Retirement of fractional shares (in shares) | (88) | ||||||||
Change in par value | 0 | $ (29) | 29 | ||||||
Special cash dividends ($42.00 per share) | (613,294) | (613,294) | |||||||
Common dividends | [1] | (1,095) | (1,095) | ||||||
Issuance of Series A Preferred Warrants | 252 | 252 | |||||||
Dividends to holders of Series A Preferred Stock ($0.34375 per share) | (1,318) | (1,318) | |||||||
Reclassification of Series A Preferred Stock to permanent equity (in shares) | 307,856 | ||||||||
Reclassification of Series A Preferred Stock to permanent equity | 7,014 | (649) | $ 7,663 | ||||||
Redemption of Series A Preferred Stock (in shares) | (115) | ||||||||
Redemption of Series A Preferred Stock | (3) | $ (3) | |||||||
Other comprehensive income (loss) | 0 | ||||||||
NET INCOME (LOSS) | 2,856 | 2,848 | 8 | ||||||
Ending balance (in shares) at Sep. 30, 2019 | 14,602,149 | 2,450,417 | 8,080,740 | ||||||
Ending balance at Sep. 30, 2019 | $ 360,601 | $ 15 | $ 788,342 | $ 0 | $ (718,493) | $ 499 | $ 60,987 | $ 229,251 | |
[1] | All share and per share amounts have been adjusted to give retroactive effect to the one-for-three reverse stock split of our common stock effected on September 3, 2019. |
Consolidated Statements of Eq_2
Consolidated Statements of Equity (Parenthetical) | Sep. 03, 2019 | Sep. 30, 2019$ / shares | Jun. 30, 2019$ / shares | Mar. 31, 2019$ / shares | Sep. 30, 2018$ / shares | Jun. 30, 2018$ / shares | Mar. 31, 2018$ / shares |
Common dividends (in usd per share) | $ 0.075 | $ 0.375 | $ 0.375 | $ 0.375 | $ 0.375 | $ 0.375 | |
Dividends to holders of Series A Preferred Stock (in usd per share) | 0.34375 | $ 0.34375 | $ 0.34375 | $ 0.34375 | $ 0.34375 | $ 0.34375 | |
Reverse stock split ratio, common stock | 0.3333 | ||||||
Special Dividend | |||||||
Common dividends (in usd per share) | $ 42 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
NET INCOME (LOSS) | $ 347,046,000 | $ 2,042,000 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Deferred rent and amortization of intangible assets, liabilities and lease inducements | (2,019,000) | (3,246,000) |
Depreciation and amortization | 21,995,000 | 39,783,000 |
Reclassification from AOCI to interest expense | (1,806,000) | (320,000) |
Reclassification from other assets to interest expense for swap termination | 1,421,000 | 0 |
Change in fair value of swaps | 209,000 | 70,000 |
Gain on sale of real estate | (433,104,000) | 0 |
Impairment of real estate | 69,000,000 | 0 |
Loss on early extinguishment of debt | 29,982,000 | 0 |
Straight-line rent expense | 0 | (18,000) |
Amortization of deferred loan costs | 864,000 | 639,000 |
Amortization of premiums and discounts on debt | (150,000) | (111,000) |
Unrealized premium adjustment | 1,293,000 | 1,946,000 |
Amortization and accretion on loans receivable, net | (250,000) | (228,000) |
Bad debt expense | 73,000 | 222,000 |
Deferred income taxes | (76,000) | 62,000 |
Stock-based compensation | 138,000 | 124,000 |
Loans funded, held for sale to secondary market | (20,566,000) | (39,990,000) |
Proceeds from sale of guaranteed loans | 29,716,000 | 41,408,000 |
Principal collected on loans subject to secured borrowings | 2,477,000 | 1,642,000 |
Other operating activity | (581,000) | (1,079,000) |
Changes in operating assets and liabilities: | ||
Accounts receivable and interest receivable | 1,604,000 | 5,390,000 |
Other assets | 3,101,000 | (1,820,000) |
Accounts payable and accrued expenses | (3,224,000) | 2,137,000 |
Deferred leasing costs | (1,296,000) | (1,922,000) |
Other liabilities | (7,956,000) | 1,046,000 |
Due to related parties | (4,292,000) | 2,024,000 |
Net cash provided by operating activities | 33,599,000 | 49,801,000 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Additions to investments in real estate | (19,946,000) | (10,139,000) |
Acquisition of real estate | 0 | (112,048,000) |
Proceeds from sale of real estate, net | 941,032,000 | 0 |
Loans funded | (6,855,000) | (13,330,000) |
Principal collected on loans | 5,916,000 | 8,501,000 |
Other investing activity | 354,000 | 124,000 |
Net cash provided by (used in) investing activities | 920,501,000 | (126,892,000) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Payment of unsecured revolving lines of credit, revolving credit facility and or term note | (135,500,000) | 0 |
Proceeds from unsecured revolving lines of credit, revolving credit facility and or term note | 74,000,000 | 0 |
Payment of mortgages payable | (46,000,000) | 0 |
Investments in marketable securities in connection with the legal defeasance of mortgages payable | (268,194,000) | 0 |
Prepayment penalties and other payments for early extinguishment of debt | (5,660,000) | 0 |
Payment of principal on SBA 7(a) loan-backed notes | (7,625,000) | (3,239,000) |
Proceeds from SBA 7(a) loan-backed notes | 0 | 38,200,000 |
Payment of principal on secured borrowings | (2,477,000) | (1,642,000) |
Proceeds from secured borrowings | 0 | 772,000 |
Payment of deferred preferred stock offering costs | (497,000) | (1,124,000) |
Payment of deferred loan costs | (34,000) | (1,112,000) |
Payment of other deferred costs | (383,000) | (22,000) |
Payment of common dividends | (12,045,000) | (16,421,000) |
Payment of special cash dividends | (613,294,000) | (1,575,000) |
Net proceeds from issuance of Series A Preferred Warrants | 295,000 | 62,000 |
Net proceeds from issuance of Series A Preferred Stock | 28,535,000 | 26,984,000 |
Payment of preferred stock dividends | (17,095,000) | (1,404,000) |
Redemption of Series A Preferred Stock | (156,000) | (75,000) |
Retirement of fractional shares of Common Stock | (1,000) | 0 |
Noncontrolling interests' distributions | (515,000) | (67,000) |
Noncontrolling interests' contributions | 455,000 | 0 |
Net cash (used in) provided by financing activities | (1,006,191,000) | 39,337,000 |
Change in cash balances included in assets held for sale | 755,000 | 0 |
NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH | (51,336,000) | (37,754,000) |
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH: | ||
Beginning of period | 77,443,000 | 156,318,000 |
End of period | 26,107,000 | 118,564,000 |
RECONCILIATION OF CASH AND CASH EQUIVALENTS AND RESTRICTED CASH TO THE CONSOLIDATED BALANCE SHEETS: | ||
Total cash and cash equivalents and restricted cash | 77,443,000 | 156,318,000 |
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION: | ||
Cash paid during the period for interest | 10,788,000 | 20,240,000 |
Federal income taxes paid | 850,000 | 622,000 |
SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING AND FINANCING ACTIVITIES: | ||
Additions to investments in real estate included in accounts payable and accrued expenses | 3,275,000 | 11,690,000 |
Net increase in fair value of derivatives applied to other comprehensive income | 0 | 1,727,000 |
Additions to deferred costs included in accounts payable and accrued expenses | 344,000 | 993,000 |
Additions to preferred stock offering costs included in accounts payable and accrued expenses | 467,000 | 148,000 |
Preferred stock offering costs offset against redeemable preferred stock in temporary equity | 249,000 | 187,000 |
Preferred stock offering costs offset against redeemable preferred stock in permanent equity | 3,000 | 0 |
Reclassification of Series A Preferred Stock from temporary equity to permanent equity | 26,729,000 | 11,517,000 |
Reclassification of loans receivable, net to real estate owned | 243,000 | 0 |
Reclassification of Series A Preferred Stock from temporary equity to accounts payable and accrued expenses | 0 | 4,000 |
Establishment of right-of use asset and lease liability | 362,000 | 0 |
Marketable securities transferred in connection with the legal defeasance of mortgages payable | 268,194,000 | 0 |
Mortgage notes payable legally defeased | 245,000,000 | 0 |
Mortgage note assumed in connection with our sale of real estate | $ 28,200,000 | $ 0 |
ORGANIZATION AND OPERATIONS
ORGANIZATION AND OPERATIONS | 9 Months Ended |
Sep. 30, 2019 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND OPERATIONS | ORGANIZATION AND OPERATIONS CIM Commercial Trust Corporation ("CIM Commercial" or the "Company"), a Maryland corporation and real estate investment trust ("REIT"), together with its wholly-owned subsidiaries ("we," "us" or "our") primarily acquires, owns, and operates Class A and creative office assets in vibrant and improving metropolitan communities throughout the United States. These communities are located in areas that include traditional downtown areas and suburban main streets, which have high barriers to entry, high population density, positive population trends and a propensity for growth. We were originally organized in 1993 as PMC Commercial Trust ("PMC Commercial"), a Texas real estate investment trust. On July 8, 2013 , PMC Commercial entered into a merger agreement with CIM Urban REIT, LLC ("CIM REIT"), an affiliate of CIM Group, L.P. ("CIM Group" or "CIM"), and subsidiaries of the respective parties. CIM REIT was a private commercial REIT and was the owner of CIM Urban Partners, L.P. ("CIM Urban"). The merger was completed on March 11, 2014 (the "Acquisition Date"). Our common stock, $0.001 par value per share ("Common Stock"), is currently traded on the Nasdaq Global Market ("Nasdaq"), under the ticker symbol "CMCT", and on the Tel Aviv Stock Exchange (the "TASE"), under the ticker symbol "CMCT-L." Our Series L preferred stock, $0.001 par value per share ("Series L Preferred Stock"), is currently traded on Nasdaq and on the TASE, in each case under the ticker symbol "CMCTP." We have authorized for issuance 900,000,000 shares of common stock and 100,000,000 shares of preferred stock ("Preferred Stock"). We filed Articles of Amendment (the "Reverse Stock Split Amendment") to effectuate a one-for-three reverse stock split of our Common Stock, effective on September 3, 2019 (the "Reverse Stock Split"). Pursuant to the Reverse Stock Split Amendment, every three shares of Common Stock issued and outstanding immediately prior to the effective time of the Reverse Stock Split were converted into one share of Common Stock, par value $0.003 per share. In connection with the Reverse Split Amendment, the Company filed Articles of Amendment (the "Par Value Amendment") to revert the par value of the Common Stock issued and outstanding from $0.003 per share to $0.001 per share, effective as of September 3, 2019, following the effective time of the Reverse Split Amendment. All Common Stock and per share of Common Stock amounts set forth in this Quarterly Report on Form 10-Q have been adjusted to give retroactive effect to the Reverse Stock Split, unless otherwise stated. CIM Commercial has qualified and intends to continue to qualify as a REIT, as defined in the Internal Revenue Code of 1986, as amended. |
BASIS OF PRESENTATION AND SUMMA
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 9 Months Ended |
Sep. 30, 2019 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES For more information regarding our significant accounting policies and estimates, please refer to "Basis of Presentation and Summary of Significant Accounting Policies" contained in Note 2 to our consolidated financial statements for the year ended December 31, 2018 , included in our Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 18, 2019 . Interim Financial Information —The accompanying interim consolidated financial statements of CIM Commercial have been prepared by our management in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim consolidated financial statements do not include all of the information and notes required by GAAP for complete financial statements. The accompanying financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods. Operating results for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 . Our accompanying interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K filed with the SEC on March 18, 2019 . Principles of Consolidation —The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. Investments in Real Estate —Real estate acquisitions are recorded at cost as of the acquisition date. Costs related to the acquisition of properties were expensed as incurred for acquisitions that occurred prior to October 1, 2017. For any acquisition occurring on or after October 1, 2017, we have conducted and will conduct an analysis to determine if the acquisition constitutes a business combination or an asset purchase. If the acquisition constitutes a business combination, then the transaction costs will be expensed as incurred, and if the acquisition constitutes an asset purchase, then the transaction costs will be capitalized. Investments in real estate are stated at depreciated cost. Depreciation and amortization are recorded on a straight-line basis over the estimated useful lives as follows: Buildings and improvements 15 - 40 years Furniture, fixtures, and equipment 3 - 5 years Tenant improvements Shorter of the useful lives or the We capitalize project costs, including pre-construction costs, interest expense, property taxes, insurance, and other costs directly related and essential to the development, redevelopment, or construction of a project, while activities are ongoing to prepare an asset for its intended use. Costs incurred after a project is substantially complete and ready for its intended use are expensed as incurred. Improvements and replacements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. Ordinary repairs and maintenance are expensed as incurred. Investments in real estate are evaluated for impairment on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. The estimated fair value of the asset group identified for step two of the impairment testing under GAAP is based on either the income approach, with market discount rate, terminal capitalization rate and rental rate assumptions being most critical to such analysis, or on the sales comparison approach to similar properties. Assets held for sale are reported at the lower of the asset's carrying amount or fair value, less costs to sell. For the three and nine months ended September 30, 2019 , we recognized impairment of long-lived assets of $0 and $69,000,000 , respectively (Note 3). For the three and nine months ended September 30, 2018 , we recognized no impairment of long-lived assets. Derivative Financial Instruments —As part of risk management and operational strategies, from time to time, we may enter into derivative contracts with various counterparties. All derivatives are recognized on the balance sheet at their estimated fair value. On the date that we enter into a derivative contract, we designate the derivative as a fair value hedge, a cash flow hedge, a foreign currency fair value or cash flow hedge, a hedge of a net investment in a foreign operation, or a trading or non-hedging instrument. Changes in the estimated fair value of a derivative that is highly effective and that is designated and qualifies as a cash flow hedge, to the extent that the hedge is effective, are initially recorded in other comprehensive income ("OCI"), and are subsequently reclassified into earnings as a component of interest expense when the variability of cash flows of the hedged transaction affects earnings (e.g., when periodic settlements of a variable-rate asset or liability are recorded in earnings). Any hedge ineffectiveness (which represents the amount by which the changes in the estimated fair value of the derivative differ from the variability in the cash flows of the forecasted transaction) is recognized in current-period earnings as a component of interest expense. When an interest rate swap designated as a cash flow hedge no longer qualifies for hedge accounting, we recognize changes in the estimated fair value of the hedge previously deferred to accumulated other comprehensive income ("AOCI"), along with any changes in estimated fair value occurring thereafter, through earnings. We classify cash flows from interest rate swap agreements as net cash provided by operating activities on the consolidated statements of cash flows as our accounting policy is to present the cash flows from the hedging instruments in the same category in the consolidated statements of cash flows as the category for the cash flows from the hedged items. See Note 12 for disclosures about our derivative financial instruments and hedging activities. Revenue Recognition —We use a five-step model to recognize revenue for contracts with customers. The five-step model requires that we (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) we satisfy the performance obligation. Revenue from leasing activities We operate as a lessor of real estate assets, primarily in Class A and creative office assets. In determining whether our contracts with our tenants constitute leases, we determined that our contracts explicitly identify the premises and that any substitution rights to relocate the tenant to other premises within the same building stated in the contract are not substantive. Additionally, so long as payments are made timely under these contracts, our tenants have the right to obtain substantially all the economic benefits from the use of this identified asset and can direct how and for what purpose the premises are used to conduct their operations. Therefore, our contracts with our tenants constitute leases. All leases are classified as operating leases and minimum rents are recognized on a straight-line basis over the terms of the leases when collectability is reasonably assured and the tenant has taken possession or controls the physical use of the leased asset. The excess of rents recognized over amounts contractually due pursuant to the underlying leases is recorded as deferred rent. If the lease provides for tenant improvements, we determine whether the tenant improvements, for accounting purposes, are owned by the tenant or us. When we are the owner of the tenant improvements, the tenant is not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements are substantially completed. When the tenant is considered the owner of the improvements, any tenant improvement allowance that is funded is treated as an incentive. Lease incentives paid to tenants are included in other assets and amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease. Reimbursements from tenants, consisting of amounts due from tenants for common area maintenance, real estate taxes, insurance, and other recoverable costs, are recognized as revenue in the period the expenses are incurred. Tenant reimbursements are recognized and presented on a gross basis when we are primarily responsible for fulfilling the promise to provide the specified good or service and control that specified good or service before it is transferred to the tenant. We have elected not to separate lease and non-lease components as the pattern of revenue recognition does not differ for the two components, and the non-lease component is not the primary component in our leases. In addition to minimum rents, certain leases provide for additional rents based upon varying percentages of tenants’ sales in excess of annual minimums. Percentage rent is recognized once lessees’ specified sales targets have been met. We derive parking revenues from leases with third-party operators. Our parking leases provide for additional rents based upon varying percentages of tenants’ sales in excess of annual minimums. Parking percentage rent is recognized once lessees’ specific sales targets have been met. For the three and nine months ended September 30, 2019 and 2018 , we recognized rental income as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in thousands) Rental and other property income Fixed lease payments (1) $ 15,389 $ 34,108 $ 66,925 $ 101,423 Variable lease payments (2) 1,917 2,498 6,381 8,152 Rental and other property income $ 17,306 $ 36,606 $ 73,306 $ 109,575 (1) Fixed lease payments include contractual rents under lease agreements with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above-market leases, below-market leases and lease incentives. (2) Variable lease payments include expense reimbursements billed to tenants and percentage rent, net of bad debt expense from our operating leases. Revenue from lending activities Interest income included in interest and other income is comprised of interest earned on loans and our short-term investments and the accretion of net loan origination fees and discounts. Interest income on loans is accrued as earned with the accrual of interest suspended when the related loan becomes a Non-Accrual Loan (as defined below). Revenue from hotel activities Hotel revenue is recognized upon establishment of a contract with a customer. At contract inception, the Company assesses the goods and services promised in its contracts with customers and identifies a performance obligation for each promise to transfer to the customer a good or service (or bundle of goods or services) that is distinct. To identify the performance obligations, the Company considers all of the goods or services promised in the contract regardless of whether they are explicitly stated or implied by customary business practices. Various performance obligations of hotel revenues can be categorized as follows: • cancellable and noncancelable room revenues from reservations and • ancillary services including facility usage and food or beverage. Cancellable reservations represent a single performance obligation of providing lodging services at the hotel. The Company satisfies its performance obligation and recognizes revenues associated with these reservations over time as services are rendered to the customer. The Company satisfies its performance obligation and recognizes revenues associated with noncancelable reservations at the earlier of (i) the date on which the customer cancels the reservation or (ii) over time as services are rendered to the customer. Ancillary services include facilities usage and providing food and beverage. The Company satisfies its performance obligation and recognizes revenues associated with these services at a point in time as the good or service is delivered to the customer. At inception of these contracts with customers for hotel revenues, the contractual price is equivalent to the transaction price as there are no elements of variable consideration to estimate. We recognized hotel income of $7,734,000 and $7,715,000 for the three months ended September 30, 2019 and 2018 , respectively, and $27,087,000 and $27,564,000 for the nine months ended September 30, 2019 and 2018 , respectively. Below is a reconciliation of the hotel revenue from contracts with customers to the total hotel segment revenue disclosed in Note 18: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in thousands) Hotel properties Hotel income $ 7,734 $ 7,715 $ 27,087 $ 27,564 Rental and other property income 736 777 2,208 2,273 Interest and other income 41 50 135 143 Hotel revenues $ 8,511 $ 8,542 $ 29,430 $ 29,980 Tenant recoveries outside of the lease agreements Tenant recoveries outside of the lease agreements are related to construction projects in which our tenants have agreed to fully reimburse us for all costs related to construction. These services include architectural, permit expediter and construction services. At inception of the contract with the customer, the contractual price is equivalent to the transaction price as there are no elements of variable consideration to estimate. While these individual services are distinct, in the context of the arrangement with the customer, all of these services are bundled together and represent a single package of construction services requested by the customer. The Company satisfies its performance obligation and recognizes revenues associated with these services over time as the construction is completed. Amounts recognized for tenant recoveries outside of the lease agreements were $0 and $120,000 for the three months ended September 30, 2019 and 2018 , respectively, and $205,000 and $398,000 for the nine months ended September 30, 2019 and 2018 , respectively, which are included in interest and other income on the consolidated statements of operations. As of September 30, 2019 , there were no remaining performance obligations associated with tenant recoveries outside of the lease agreements. Loans Receivable —Our loans receivable are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves. For loans originated under the Small Business Administration's ("SBA") 7(a) Guaranteed Loan Program ("SBA 7(a) Program"), we sell the portion of the loan that is guaranteed by the SBA. Upon sale of the SBA guaranteed portion of the loans, which are accounted for as sales, the unguaranteed portion of the loan retained by us is valued on a fair value basis and a discount is recorded as a reduction in basis of the retained portion of the loan. Unamortized retained loan discounts were $7,673,000 and $7,234,000 as of September 30, 2019 and December 31, 2018 , respectively. At the Acquisition Date, the carrying value of our loans was adjusted to estimated fair market value and acquisition discounts of $33,907,000 were recorded, which are being accreted to interest and other income using the effective interest method. We sold substantially all of our commercial mortgage loans with unamortized acquisition discounts of $15,951,000 to an unrelated third-party in December 2015. Acquisition discounts of $774,000 and $884,000 remained as of September 30, 2019 and December 31, 2018 , respectively. A loan receivable is generally classified as non-accrual (a "Non-Accrual Loan") if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and or interest is in doubt. Generally, loans are charged-off when management determines that we will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means. Interest income, included in interest and other income, on a Non-Accrual Loan is recognized on either the cash basis or the cost recovery basis. On a quarterly basis, and more frequently if indicators exist, we evaluate the collectability of our loans receivable. Our evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers' business models and future operations in accordance with Accounting Standards Codification ("ASC") 450-20, Contingencies—Loss Contingencies , and ASC 310-10, Receivables . For the three and nine months ended September 30, 2019 , we recorded $140,000 and $82,000 , respectively, of impairment on our loans receivable. For the three and nine months ended September 30, 2018 , we recorded no impairment on our loans receivable. We establish a general loan loss reserve when available information indicates that it is probable a loss has occurred based on the carrying value of the portfolio and the amount of the loss can be reasonably estimated. Significant judgment is required in determining the general loan loss reserve, including estimates of the likelihood of default and the estimated fair value of the collateral. The general loan loss reserve includes those loans, which may have negative characteristics which have not yet become known to us. In addition to the reserves established on loans not considered impaired that have been evaluated under a specific evaluation, we establish the general loan loss reserve using a consistent methodology to determine a loss percentage to be applied to loan balances. These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions. Deferred Rent Receivable and Charges —Deferred rent receivable and charges consist of deferred rent, deferred leasing costs, deferred offering costs (Note 10) and other deferred costs. Deferred rent receivable is $19,463,000 and $52,366,000 at September 30, 2019 and December 31, 2018 , respectively. Deferred leasing costs, which represent lease commissions and other direct costs associated with the acquisition of tenants, are capitalized and amortized on a straight-line basis over the terms of the related leases. Deferred leasing costs of $16,771,000 and $51,152,000 are presented net of accumulated amortization of $7,125,000 and $23,910,000 at September 30, 2019 and December 31, 2018 , respectively. Deferred offering costs represent direct costs incurred in connection with our offering of Series A Preferred Units (as defined in Note 10), excluding costs specifically identifiable to a closing, such as commissions, dealer-manager fees, and other offering fees and expenses. For a specific issuance of Series A Preferred Units, issuance-specific offering costs are recorded as a reduction of proceeds raised on the issuance date. Offering costs incurred but not directly related to a specifically identifiable closing are deferred. Deferred offering costs are first allocated to each issuance on a pro-rata basis equal to the ratio of Series A Preferred Units issued in an issuance to the maximum number of Series A Preferred Units that are expected to be issued. Then, the issuance-specific offering costs and the deferred offering costs allocated to such issuance are further allocated to the Series A Preferred Stock (as defined in Note 10) and Series A Preferred Warrants (as defined in Note 10) issued in such issuance based on the relative fair value of the instruments on the date of issuance. The deferred offering costs allocated to the Series A Preferred Stock and Series A Preferred Warrants are reductions to temporary equity and permanent equity, respectively. Deferred offering costs of $4,753,000 and $4,213,000 related to our offering of Series A Preferred Units are included in deferred rent receivable and charges at September 30, 2019 and December 31, 2018 , respectively. Other deferred costs are $454,000 and $409,000 at September 30, 2019 and December 31, 2018 , respectively. Redeemable Preferred Stock —Beginning on the date of original issuance of any given shares of Series A Preferred Stock (Note 10), the holder of such shares has the right to require the Company to redeem such shares at a redemption price of 100% of the Series A Preferred Stock Stated Value (as defined in Note 10), plus accrued and unpaid dividends, subject to the payment of a redemption fee until the fifth anniversary of such issuance. From and after the fifth anniversary of the date of the original issuance, the holder will have the right to require the Company to redeem such shares at a redemption price of 100% of the Series A Preferred Stock Stated Value, plus accrued and unpaid dividends, without a redemption fee, and the Company will have the right (but not the obligation) to redeem such shares at 100% of the Series A Preferred Stock Stated Value, plus accrued and unpaid dividends. The applicable redemption price payable upon redemption of any Series A Preferred Stock is payable in cash or, on or after the first anniversary of the issuance of such shares of Series A Preferred Stock to be redeemed, in the Company's sole discretion, in cash or in equal value through the issuance of shares of Common Stock, based on the volume weighted average price of our Common Stock for the 20 trading days prior to the redemption. Since a holder of Series A Preferred Stock has the right to request redemption of such shares and redemptions prior to the first anniversary are to be paid in cash, we have recorded the activity related to our Series A Preferred Stock in temporary equity. We recorded the activity related to our Series A Preferred Warrants (Note 10) in permanent equity. On the first anniversary of the date of original issuance of a particular share of Series A Preferred Stock, we reclassify such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date. Proceeds and expenses from the sale of the Series A Preferred Units are allocated to the Series A Preferred Stock and the Series A Preferred Warrants using their relative fair values on the date of issuance. From and after the fifth anniversary of the date of original issuance of the Series L Preferred Stock, each holder will have the right to require the Company to redeem, and the Company will also have the option to redeem (subject to certain conditions), such shares of Series L Preferred Stock at a redemption price equal to the Series L Preferred Stock Stated Value (as defined in Note 10), plus, provided certain conditions are met, all accrued and unpaid distributions. Notwithstanding the foregoing, a holder of shares of our Series L Preferred Stock may require us to redeem such shares at any time prior to the fifth anniversary of the date of original issuance of the Series L Preferred Stock if (1) we do not declare and pay in full the distributions on the Series L Preferred Stock for any annual period prior to such fifth anniversary or (2) we do not declare and pay all accrued and unpaid distributions on the Series L Preferred Stock for all past dividend periods prior to the applicable holder redemption date. The applicable redemption price payable upon redemption of any Series L Preferred Stock will be made, in the Company's sole discretion, in the form of (A) cash in Israeli new shekels ("ILS") at the then-current currency exchange rate determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, (B) in equal value through the issuance of shares of Common Stock, with the value of such Common Stock to be deemed the lower of (i) our net asset value ("NAV") per share of our Common Stock as most recently published by the Company as of the effective date of redemption and (ii) the volume-weighted average price of our Common Stock, determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, or (C) in a combination of cash in ILS and our Common Stock, based on the conversion mechanisms set forth in (A) and (B), respectively. We recorded the activity related to our Series L Preferred Stock in permanent equity. Noncontrolling Interests —Noncontrolling interests represent the interests in various properties owned by third-parties. Restricted Cash —Our mortgage loan and hotel management agreements provide for depositing cash into restricted accounts reserved for capital expenditures, free rent, tenant improvement and leasing commission obligations. Restricted cash also includes cash required to be segregated in connection with certain of our loans receivable. Reclassifications —Certain prior period amounts have been reclassified to conform with the current period presentation. With the adoption of Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) and the election of the lessor practical expedient not to separate lease and non-lease components, $1,857,000 and $6,248,000 of expense reimbursements were reclassified as rental and other property income on the consolidated statements of operations for the three and nine months ended September 30, 2018 , respectively, and $272,000 and $841,000 of non-lease component expense reimbursements recognized under the revenue recognition guidance were reclassified as interest and other income on the consolidated statements of operations for the three and nine months ended September 30, 2018 , respectively. Under the new leasing guidance, bad debt expense associated with changes in the collectability assessment for operating leases shall be recorded as adjustments to rental and other property income rather than rental and other property operating expenses. The impact of this reclassification resulted in a $33,000 and $152,000 reclassification from rental and other property expenses to rental and other property income on the consolidated statements of operations for the three and nine months ended September 30, 2018 , respectively. Assets Held for Sale and Discontinued Operations —In the ordinary course of business, we may periodically enter into agreements to dispose of our assets. Some of these agreements are non-binding because either they do not obligate either party to pursue any transactions until the execution of a definitive agreement or they provide the potential buyer with the ability to terminate without penalty or forfeiture of any material deposit, subject to certain specified contingencies, such as completion of due diligence at the discretion of such buyer. We do not classify assets that are subject to such non-binding agreements as held for sale. We classify assets as held for sale, if material, when they meet the necessary criteria, which include: a) management commits to and actively embarks upon a plan to sell the assets, b) the assets to be sold are available for immediate sale in their present condition, c) the sale is expected to be completed within one year under terms usual and customary for such sales and d) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. We generally believe that we meet these criteria when the plan for sale has been approved by our Board of Directors, there are no known significant contingencies related to the sale and management believes it is probable that the sale will be completed within one year. Assets held for sale are recorded at the lower of cost or estimated fair value less cost to sell. In addition, if we were to determine that the asset disposal associated with assets held for sale or disposed of represents a strategic shift, the revenues, expenses and net gain (loss) on dispositions would be recorded in discontinued operations for all periods presented through the date of the applicable disposition. Consolidation Considerations for Our Investments in Real Estate —ASC 810-10, Consolidation , addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights that would require the entity to be consolidated. We analyze our investments in real estate in accordance with this accounting standard to determine whether they are variable interest entities, and if so, whether we are the primary beneficiary. Our judgment with respect to our level of influence or control over an entity and whether we are the primary beneficiary of a variable interest entity involves consideration of various factors, including the form of our ownership interest, our voting interest, the size of our investment (including loans), and our ability to participate in major policy-making decisions. Our ability to correctly assess our influence or control over an entity affects the presentation of these investments in real estate on our consolidated financial statements. Use of Estimates —The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Recently Issued Accounting Pronouncements —In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-02, Leases (Topic 842) , which was intended to improve financial reporting about leasing transactions. Under the new guidance, a lessee was required to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with previous GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily depended on its classification as a finance or operating lease. However, unlike previous GAAP, which required a lessee to recognize only capital leases on the balance sheet, the new ASU required a lessee to recognize both types of leases on the balance sheet. The lessor accounting remained largely unchanged from previous GAAP. However, the ASU contained some targeted improvements that were intended to align, where necessary, lessor accounting with the lessee accounting model and with the updated revenue recognition guidance issued in 2014. In July 2018, the FASB issued ASU No. 2018-10, Leases (Topic 842) , which contained targeted improvements to amend inconsistencies and clarified guidance that was brought about by stakeholders. Furthermore, in July 2018, the FASB issued ASU 2018-11, Leases (Topic 842) , which provided the following practical expedients to entities: (1) a transition method that allowed entities to apply the new standard at the adoption date and to recognize a cumulative-effect adjustment to the opening balance of retained earnings effective at the adoption date; and (2) the option for lessors to not separate lease and non-lease components provided that certain criteria were met. In December 2018, the FASB issued ASU 2018-20, Leases (Topic 842) , which provided lessors the option to elect to account for sales and other similar taxes in which the lessee directly pays third-parties to be excluded from the measurement of the contract considerat |
ACQUISITIONS AND DISPOSITIONS
ACQUISITIONS AND DISPOSITIONS | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND DISPOSITIONS | ACQUISITIONS AND DISPOSITIONS The fair value of real estate acquired is recorded to the acquired tangible assets, consisting primarily of land, land improvements, building and improvements, tenant improvements, and furniture, fixtures, and equipment, and identified intangible assets and liabilities, consisting of the value of acquired above-market and below-market leases, in-place leases and ground leases, if any, based in each case on their respective fair values. Loan premiums, in the case of above-market rate loans, or loan discounts, in the case of below-market rate loans, are recorded based on the fair value of any loans assumed in connection with acquiring the real estate. 2019 Transactions —There were no acquisitions during the nine months ended September 30, 2019 . We sold 100% fee-simple interests in the following properties to unrelated third-parties during the nine months ended September 30, 2019 . Transaction costs related to these sales were expensed as incurred. Property Asset Type Date of Sale Square Feet Sales Price Transaction Costs Gain on Sale (in thousands) March Oakland Properties, Office / Parking Garage March 1, 2019 975,596 $ 512,016 $ 8,971 $ 289,779 830 1st Street, Office March 1, 2019 247,337 116,550 2,438 45,710 260 Townsend Street, Office March 14, 2019 66,682 66,000 2,539 42,092 1333 Broadway, Office May 16, 2019 254,523 115,430 658 55,221 Union Square Properties, Office / Land July 30, 2019 630,650 181,000 3,744 302 $ 990,996 $ 18,350 $ 433,104 (1) The "March Oakland Properties" consist of 1901 Harrison Street, 2100 Franklin Street, 2101 Webster Street, and 2353 Webster Street Parking Garage. (2) The "Union Square Properties" consist of 999 North Capitol Street, 899 North Capitol Street and 901 North Capitol Street. Prior to the sale, we determined that the book values of such properties exceeded their estimated fair values and recognized an impairment charge of $0 and $69,000,000 for the three and nine months ended September 30, 2019 (Note 2). Our determination of the fair values of these properties was based on negotiations with the third-party buyer and the contract sales price. The gain on sale includes $113,000 of extinguishment of noncontrolling interests as a result of the sale. The results of operations of the properties we sold have been included in the consolidated statements of operations through each property's respective disposition date. The following is the detail of the carrying amounts of assets and liabilities at the time of the sales of the properties that occurred during the nine months ended September 30, 2019 : (in thousands) Assets Investments in real estate, net $ 476,532 Deferred rent receivable and charges, net 55,297 Other intangible assets, net 316 Other assets 4,096 Total assets $ 536,241 Liabilities Debt, net (1) (2) $ 318,072 Total liabilities $ 318,072 (1) Debt is presented net of deferred loan costs of $1,704,000 and accumulated amortization of $576,000 . (2) A mortgage loan with an outstanding principal balance of $28,200,000 was assumed by the buyer in connection with the sale of our property in San Francisco, California. A mortgage loan with an outstanding principal balance of $46,000,000 was prepaid in connection with the sale in March 2019 of our property in Washington, D.C. that was collateral for the loan. Mortgage loans with an aggregate outstanding principal balance of $205,500,000 were legally defeased in connection with the sale of the March Oakland Properties that were collateral for the loans. A mortgage loan with an outstanding principal balance of $39,500,000 was legally defeased in connection with the sale in May 2019 of our property in Oakland, California that was collateral for the loan. 2018 Transactions —On January 18, 2018 , we acquired a 100% fee-simple interest in an office property known as 9460 Wilshire Boulevard from an unrelated third-party. The property has approximately 68,866 square feet of office space and 22,884 square feet of retail space and is located in Beverly Hills, California. The acquisition was funded with proceeds from our Series L Preferred Stock offering, and the acquired property is reported as part of the office segment (Note 18). We performed an analysis and, based on our analysis, we determined this acquisition was an asset purchase and not a business combination. As such, transaction costs were capitalized as incurred in connection with this acquisition. Property Asset Type Date of Acquisition Square Feet Purchase Price (1) (in thousands) 9460 Wilshire Boulevard, Beverly Hills, CA Office January 18, 2018 91,750 $ 132,000 (1) In December 2017, at the time we entered into the purchase and sale agreement, we made a $20,000,000 non-refundable deposit to an escrow account that was included in other assets on our consolidated balance sheet at December 31, 2017. Transaction costs that were capitalized in connection with the acquisition of this property totaled $48,000 , which are not included in the purchase price above. The results of operations of the property we acquired during the nine months ended September 30, 2018 have been included in the consolidated statements of operations from the date of acquisition. The purchase price of the acquisition completed during the nine months ended September 30, 2018 was less than 10% of our total assets as of the most recent annual consolidated financial statements filed at or prior to the date of acquisition. The fair value of the net assets acquired for the aforementioned acquisition during the nine months ended September 30, 2018 are as follows: (in thousands) Land $ 52,199 Land improvements 756 Buildings and improvements 74,522 Tenant improvements 1,451 Acquired in-place leases (1) 7,003 Acquired above-market leases (1) 109 Acquired below-market leases (1) (3,992 ) Net assets acquired $ 132,048 (1) Acquired in-place leases, above-market leases, and below-market leases have weighted average amortization periods of 3 years, 2 years, and 3 years, respectively. There were no dispositions during the nine months ended September 30, 2018 . Assets Held for Sale As noted above, in March 2019, we sold a 100% fee-simple interest in an office property located at 260 Townsend Street in San Francisco, California to an unrelated third-party. The office property had been classified as held for sale as of December 31, 2018 , as the purchase and sale agreement was entered into and became subject to a non-refundable deposit prior to December 31, 2018 . The following is the detail of the carrying amounts of assets and liabilities for the office properties that are classified as held for sale on our consolidated balance sheet as of December 31, 2018 : December 31, 2018 (in thousands) Assets Investments in real estate, net (1) $ 17,123 Cash and cash equivalents 755 Accounts receivable, net 41 Deferred rent receivable and charges, net (2) 4,009 Other intangible assets, net (3) 220 Other assets 27 Total assets held for sale, net $ 22,175 Liabilities Debt, net (4) $ 28,018 Accounts payable and accrued expenses 370 Due to related parties 81 Other liabilities 297 Total liabilities associated with assets held for sale, net $ 28,766 (1) Investments in real estate of $24,832,000 is presented net of accumulated depreciation of $7,709,000 . (2) Deferred rent receivable and charges consist of deferred rent receivable of $2,909,000 and deferred leasing costs of $1,669,000 net of accumulated amortization of $569,000 . (3) Other intangible assets, net, represent acquired in-place leases of $1,778,000 , which are presented net of accumulated amortization of $1,558,000 . (4) Debt, net, includes the outstanding principal balance of 260 Townsend Street of $28,200,000 , net of deferred loan costs of $243,000 and accumulated amortization of $61,000 . |
INVESTMENTS IN REAL ESTATE
INVESTMENTS IN REAL ESTATE | 9 Months Ended |
Sep. 30, 2019 | |
Real Estate [Abstract] | |
INVESTMENTS IN REAL ESTATE | INVESTMENTS IN REAL ESTATE Investments in real estate consist of the following: September 30, 2019 December 31, 2018 (in thousands) Land $ 134,421 $ 266,410 Land improvements 2,713 18,368 Buildings and improvements 437,833 912,892 Furniture, fixtures, and equipment 3,724 4,245 Tenant improvements 32,807 133,487 Work in progress 12,152 9,234 Investments in real estate 623,650 1,344,636 Accumulated depreciation (117,684 ) (303,699 ) Net investments in real estate $ 505,966 $ 1,040,937 We recorded depreciation expense of $4,156,000 and $10,901,000 for the three months ended September 30, 2019 and 2018 , respectively, and $17,908,000 and $32,487,000 for the nine months ended September 30, 2019 and 2018 , respectively. |
LOANS RECEIVABLE
LOANS RECEIVABLE | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
LOANS RECEIVABLE | LOANS RECEIVABLE Loans receivable consist of the following: September 30, 2019 December 31, 2018 (in thousands) SBA 7(a) loans receivable, subject to loan-backed notes $ 31,565 $ 36,847 SBA 7(a) loans receivable, subject to credit risk 25,670 29,385 SBA 7(a) loans receivable, subject to secured borrowings 13,876 16,409 Loans receivable 71,111 82,641 Deferred capitalized costs 1,147 1,309 Loan loss reserves (682 ) (702 ) Loans receivable, net $ 71,576 $ 83,248 SBA 7(a) Loans Receivable, Subject to Loan-Backed Notes —Represents the unguaranteed portions of loans originated under the SBA 7(a) Program which were transferred to a trust and are held as collateral in connection with a securitization transaction. The proceeds received from the transfer are reflected as loan-backed notes payable (Note 7). SBA 7(a) Loans Receivable, Subject to Credit Risk —Represents the unguaranteed portions of loans originated under the SBA 7(a) Program which were retained by the Company and the government guaranteed portions of such loans that have not yet been fully funded or sold. SBA 7(a) Loans Receivable, Subject to Secured Borrowings —Represents the government guaranteed portions of loans originated under the SBA 7(a) Program which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans. There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal. At September 30, 2019 and December 31, 2018 , 99.9% and 99.7% , respectively, of our loans subject to credit risk were current. We classify loans with negative characteristics in substandard categories ranging from special mention to doubtful. At September 30, 2019 and December 31, 2018 , $866,000 and $235,000 , respectively, of loans subject to credit risk were classified in substandard categories. At September 30, 2019 and December 31, 2018 , our loans subject to credit risk were 98.8% and 98.3% , respectively, concentrated in the hospitality industry. |
OTHER INTANGIBLE ASSETS
OTHER INTANGIBLE ASSETS | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
OTHER INTANGIBLE ASSETS | OTHER INTANGIBLE ASSETS A schedule of our intangible assets and liabilities and related accumulated amortization and accretion as of September 30, 2019 and December 31, 2018 is as follows: Assets Liabilities September 30, 2019 Acquired Above-Market Leases Acquired Trade Name and License Acquired (in thousands) Gross balance $ 74 $ 13,653 $ 2,957 $ (3,521 ) Accumulated amortization (38 ) (8,906 ) — 1,959 $ 36 $ 4,747 $ 2,957 $ (1,562 ) Average useful life (in years) 5 8 Indefinite 4 Assets Liabilities December 31, 2018 Acquired Acquired Trade Name and License Acquired (in thousands) Gross balance $ 146 $ 16,210 $ 2,957 $ (6,618 ) Accumulated amortization (51 ) (9,731 ) — 3,746 $ 95 $ 6,479 $ 2,957 $ (2,872 ) Average useful life (in years) 3 8 Indefinite 4 The amortization of the acquired above-market leases, which decreased rental and other property income, was $17,000 and $14,000 for the three months ended September 30, 2019 and 2018 , respectively, and $59,000 and $40,000 for the nine months ended September 30, 2019 and 2018 , respectively. The amortization of the acquired in-place leases included in depreciation and amortization expense was $495,000 and $927,000 for the three months ended September 30, 2019 and 2018 , respectively, and $1,636,000 and $2,769,000 for the nine months ended September 30, 2019 and 2018 , respectively. The amortization of the acquired below-market leases included in rental and other property income was $376,000 and $478,000 for the three months ended September 30, 2019 and 2018 , respectively, and $1,310,000 and $1,711,000 for the nine months ended September 30, 2019 and 2018 , respectively. A schedule of future amortization and accretion of acquisition related intangible assets and liabilities as of September 30, 2019 , is as follows: Assets Liabilities Years Ending December 31, Acquired Acquired Acquired (in thousands) 2019 (Three months ending December 31, 2019) $ 4 $ 476 $ (280 ) 2020 9 1,349 (701 ) 2021 5 899 (347 ) 2022 5 663 (234 ) 2023 6 375 — Thereafter 7 985 — $ 36 $ 4,747 $ (1,562 ) |
DEBT
DEBT | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Information on our debt is as follows: September 30, 2019 December 31, 2018 (in thousands) Mortgage loan with a fixed interest rate of 4.14% per annum, with monthly payments of interest only, and a balance of $97,100,000 due on July 1, 2026. The loan is nonrecourse. On March 1, 2019, mortgage loans with an aggregate outstanding principal balance of $205,500,000 were legally defeased in connection with the sale of the properties that were collateral for the loans. On May 16, 2019, one loan with an outstanding principal balance of $39,500,000 was legally defeased in connection with the sale of the property that was collateral for the loan. $ 97,100 $ 342,100 Mortgage loan with a fixed interest rate of 4.50% per annum, with monthly payments of interest only for 10 years, and payments of interest and principal starting in February 2022. The loan had a $42,008,000 balance due on January 5, 2027. The loan was nonrecourse. On March 1, 2019, the mortgage loan was prepaid in connection with the sale of the property that was collateral for the loan. — 46,000 97,100 388,100 Deferred loan costs related to mortgage loans (181 ) (1,177 ) Total Mortgages Payable 96,919 386,923 Secured borrowing principal on SBA 7(a) loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 6.21% and 5.89% at September 30, 2019 and December 31, 2018, respectively. 8,935 11,283 Secured borrowing principal on SBA 7(a) loans sold for excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 3.82% and 3.57% at September 30, 2019 and December 31, 2018, respectively. 4,353 4,482 13,288 15,765 Unamortized premiums 727 940 Total Secured Borrowings—Government Guaranteed Loans 14,015 16,705 Revolving credit facility 68,500 130,000 SBA 7(a) loan-backed notes with a variable interest rate which resets monthly based on the lesser of the one-month LIBOR plus 1.40% or the prime rate less 1.08%, with payments of interest and principal due monthly. Balance due at maturity in March 20, 2043. 26,144 33,769 Junior subordinated notes with a variable interest rate which resets quarterly based on the three-month LIBOR plus 3.25%, with quarterly interest only payments. Balance due at maturity on March 30, 2035. 27,070 27,070 121,714 190,839 Deferred loan costs related to other debt (3,129 ) (3,941 ) Discount on junior subordinated notes (1,792 ) (1,855 ) Total Other Debt 116,793 185,043 Total Debt $ 227,727 $ 588,671 The mortgages payable are secured by deeds of trust on certain of the properties and assignments of rents. The junior subordinated notes may be redeemed at par at our option. Secured borrowings—government guaranteed loans represent sold loans which are treated as secured borrowings because the loan sales did not meet the derecognition criteria provided for in ASC 860-30, Secured Borrowing and Collateral . These loans included cash premiums that are amortized as a reduction to interest expense over the life of the loan using the effective interest method and are fully amortized when the underlying loan is repaid in full. SBA 7(a) loan-backed notes are secured by deeds of trust or mortgages. Deferred loan costs, which represent legal and third-party fees incurred in connection with our borrowing activities, are capitalized and amortized to interest expense on a straight-line basis over the life of the related loan, approximating the effective interest method. Deferred loan costs of $4,535,000 and $5,994,000 are presented net of accumulated amortization of $1,225,000 and $876,000 at September 30, 2019 and December 31, 2018 , respectively, and are a reduction to total debt. In September 2014, CIM Commercial entered into an $850,000,000 unsecured credit facility with a bank syndicate which consisted of a $450,000,000 revolver, a $325,000,000 term loan and a $75,000,000 delayed-draw term loan. Outstanding advances under the revolver bore interest at (i) the base rate plus 0.20% to 1.00% or (ii) LIBOR plus 1.20% to 2.00% , depending on the maximum consolidated leverage ratio. Outstanding advances under the term loans bore interest at (i) the base rate plus 0.15% to 0.95% or (ii) LIBOR plus 1.15% to 1.95% , depending on the maximum consolidated leverage ratio. Our unsecured credit facility matured on September 30, 2018. In May 2015, CIM Commercial entered into an unsecured term loan facility with a bank syndicate pursuant to which CIM Commercial could borrow up to a maximum of $385,000,000 . Outstanding advances under the term loan facility bore interest at (i) the base rate plus 0.60% to 1.25% or (ii) LIBOR plus 1.60% to 2.25% , depending on the maximum consolidated leverage ratio, which interest rate was effectively converted to a fixed rate of 3.16% through interest rate swaps. The term loan facility had a maturity date in May 2022. On November 2, 2015, $385,000,000 was drawn under the term loan facility. Proceeds from the term loan facility were used to repay balances outstanding under our unsecured credit facility. During the year ended December 31, 2017 , we repaid $215,000,000 of outstanding borrowings on our unsecured term loan facility. In connection with such paydowns, we wrote off deferred loan costs of $1,988,000 and related accumulated amortization of $705,000 , a proportionate amount to the borrowings being repaid. On October 30, 2018 , we repaid and terminated the $170,000,000 of outstanding borrowings on our unsecured term loan facility using proceeds from our new revolving credit facility (as described below). In connection with such paydown and termination, we wrote off the remaining deferred loan costs of $1,872,000 and related accumulated amortization of $1,064,000 . In June 2016, we entered into six mortgage loan agreements with an aggregate principal amount of $392,000,000 . A portion of the net proceeds from the loans was used to repay outstanding balances under our unsecured credit facility and the remaining portion was used to repurchase shares of our Common Stock in a private repurchase in September 2016. On September 21, 2017, in connection with the sale of an office property in Los Angeles, California, one mortgage loan with an outstanding principal balance of $21,700,000 , collateralized by such property, was assumed by the buyer. On March 1, 2019, additional mortgage loans with an aggregate outstanding principal balance of $205,500,000 at such time, were legally defeased in connection with the sale of the related properties. The cash outlay required for the defeasance in the net amount of $224,086,000 was based on the purchase price of U.S. government securities that will generate sufficient cash flow to fund continued interest payments on the loans from the effective date of the defeasance through the date on which we could repay the loans at par. As a result of the defeasance, we recognized a loss on early extinguishment of debt of $0 and $19,290,000 for the three and nine months ended September 30, 2019 , respectively, which represents the sum of the difference between the purchase price of U.S. government securities of $224,086,000 and the aggregate outstanding principal balance of the mortgage loans of $205,500,000 , the write-off of deferred loan costs of $637,000 and related accumulated amortization of $170,000 , and transaction costs of $237,000 . On March 14, 2019 , in connection with the sale of an office property in San Francisco, California, one mortgage loan with an outstanding principal balance of $28,200,000 at such time was assumed by the buyer. As a result of this assumption, we recognized a loss on early extinguishment of debt of $0 and $178,000 for the three and nine months ended September 30, 2019 , respectively, which represents the write-off of deferred loan costs of $243,000 and related accumulated amortization of $65,000 . On May 16, 2019 , one mortgage loan with an outstanding principal balance of $39,500,000 at such time, was legally defeased in connection with the sale of the related property. The cash outlay required for the defeasance in the net amount of $44,108,000 was based on the purchase price of U.S. government securities that will generate sufficient cash flow to fund continued interest payments on the loan from the effective date of the defeasance through the date on which we could repay the loan at par. As a result of the defeasance, we recognized a loss on early extinguishment of debt of $0 and $4,911,000 for the three and nine months ended September 30, 2019 , respectively, which represents the sum of the difference between the purchase price of U.S. government securities of $44,108,000 and the outstanding principal balance of the mortgage loan of $39,500,000 , the write-off of deferred loan costs of $287,000 and related accumulated amortization of $82,000 , and transaction costs of $98,000 . On May 30, 2018 , we completed a securitization of the unguaranteed portion of certain of our SBA 7(a) loans receivable with the issuance of $38,200,000 of unguaranteed SBA 7(a) loan-backed notes. The securitization uses a trust formed for the benefit of the note holders (the "Trust") which is considered a variable interest entity ("VIE"). Applying the consolidation requirements for VIEs under the accounting rules in ASC Topic 810, Consolidation , the Company determined that it is the primary beneficiary based on its power to direct activities through its role as servicer and its obligations to absorb losses and right to receive benefits. The SBA 7(a) loan-backed notes are collateralized solely by the right to receive payments and other recoveries attributable to the unguaranteed portions of certain of our SBA 7(a) loans receivable. The SBA 7(a) loan-backed notes mature on March 20, 2043, with monthly payments due as payments on the collateralized loans are received. Based on the anticipated repayments of our collateralized SBA 7(a) loans, we estimate the weighted average life of the SBA 7(a) loan-backed notes to be approximately two years. The SBA 7(a) loan-backed notes bear interest at the lower of the one-month LIBOR plus 1.40% or the prime rate less 1.08% . We reflect the SBA 7(a) loans receivable as assets on our consolidated balance sheets and the SBA 7(a) loan-backed notes as debt on our consolidated balance sheets. The restricted cash on our consolidated balance sheets as of September 30, 2019 and December 31, 2018 included $2,232,000 and $3,174,000 , respectively, of funds related to our SBA 7(a) loan-backed notes. In October 2018, CIM Commercial entered into a revolving credit facility with a bank syndicate pursuant to which CIM Commercial can borrow up to a maximum of $250,000,000 , subject to a borrowing base calculation. The revolving credit facility is secured by deeds of trust on certain properties. Outstanding advances under the revolving credit facility bear interest at (i) the base rate plus 0.55% or (ii) LIBOR plus 1.55% . At December 31, 2018 , the variable interest rate was 4.07% . The interest rate on the first $120,000,000 of one-month LIBOR indexed variable rate borrowings on our revolving credit facility was effectively converted to a fixed rate of 3.11% through interest rate swaps until such swaps were terminated on March 11, 2019 . The revolving credit facility is also subject to an unused commitment fee of 0.15% or 0.25% depending on the amount of aggregate unused commitments. The revolving credit facility matures in October 2022 and provides for one one -year extension option under certain conditions. The Company has no current plans to refinance or repay the revolving credit facility. On October 30, 2018 , we borrowed $170,000,000 on this facility to repay outstanding borrowings on our unsecured term loan facility. On December 28, 2018 , we repaid $40,000,000 of outstanding borrowings on our revolving credit facility and we terminated one interest rate swap with a notional value of $50,000,000 (Note 12). On February 28, 2019 and March 11, 2019 , we repaid $10,000,000 and $120,000,000 , respectively, of outstanding borrowings on our revolving credit facility using cash on hand and net proceeds from the 2019 asset sales (Note 3), and, in connection with the March 11, 2019 repayment, we terminated our two remaining interest rate swaps, which had an aggregate notional value of $120,000,000 (Note 12). At September 30, 2019 and December 31, 2018 , $68,500,000 and $130,000,000 , respectively, was outstanding under the revolving credit facility, and approximately $175,100,000 and $91,000,000 , respectively, was available for future borrowings. On October 18, 2019 , we borrowed $76,500,000 under the revolving credit facility, which was placed into escrow to substantially fund the tender offer for Series L Preferred Stock (Note 10), expected to expire on November 20, 2019 . The revolving credit facility is not subject to any financial covenants, but is subject to a borrowing base calculation that determines the amount we can borrow. On March 1, 2019 , in connection with the sale of an office property in Washington, D.C., we prepaid the related mortgage loan with an outstanding principal balance of $46,000,000 at such time, using proceeds from the sale. As a result, we recognized a loss on early extinguishment of debt of $0 and $5,603,000 for the three and nine months ended September 30, 2019 , respectively, which represents a prepayment penalty of $5,325,000 and the write-off of deferred loan costs of $537,000 and related accumulated amortization of $259,000 . At September 30, 2019 and December 31, 2018 , accrued interest and unused commitment fees payable of $552,000 and $1,574,000 , respectively, are included in accounts payable and accrued expenses. Future principal payments on our debt (face value) at September 30, 2019 are as follows: Years Ending December 31, Mortgages Payable Secured Borrowings Principal (1) Other (1) (2) Total (in thousands) 2019 (Three months ending December 31, 2019) $ — $ 128 $ 1,351 $ 1,479 2020 — 529 1,844 2,373 2021 — 557 1,893 2,450 2022 — 588 70,443 71,031 2023 — 620 2,000 2,620 Thereafter 97,100 10,866 44,183 152,149 $ 97,100 $ 13,288 $ 121,714 $ 232,102 (1) Principal payments on secured borrowings and SBA 7(a) loan-backed notes, which are included in Other, are generally dependent upon cash flows received from the underlying loans. Our estimate of their repayment is based on scheduled payments on the underlying loans. Our estimate will differ from actual amounts to the extent we experience prepayments and or loan liquidations or charge-offs. No payment is due unless payments are received from the borrowers on the underlying loans. (2) Represents the junior subordinated notes, SBA 7(a) loan-backed notes, and revolving credit facility. |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS | 9 Months Ended |
Sep. 30, 2019 | |
Share-based Payment Arrangement [Abstract] | |
STOCK-BASED COMPENSATION PLANS | STOCK-BASED COMPENSATION PLANS In June 2017, we granted awards of 1,065 restricted shares of Common Stock to each of the independent members of the Board of Directors ( 3,195 in aggregate) under the 2015 Equity Incentive Plan, which fully vested in June 2018 based on one year of continuous service. In May 2018, we granted awards of 1,126 restricted shares of Common Stock to each of the independent members of the Board of Directors ( 3,378 in aggregate) under the 2015 Equity Incentive Plan, which fully vested in May 2019 based on one year of continuous service. In May 2019, we granted awards of 889 restricted shares of Common Stock to each of the independent members of the Board of Directors ( 3,556 in aggregate) under the 2015 Equity Incentive Plan, which vest after one year of continuous service. In July 2019, we granted awards of 81 restricted shares of Common Stock to each of the independent members of the Board of Directors ( 324 in aggregate) under the 2015 Equity Incentive Plan, which will vest at the same time as the restricted shares of Common Stock granted in May 2019. Compensation expense related to these restricted shares of Common Stock is recognized over the vesting period. We recorded compensation expense related to these restricted shares of Common Stock in the amount of $56,000 and $38,000 for the three months ended September 30, 2019 and 2018 , respectively, and $138,000 and $124,000 for the nine months ended September 30, 2019 and 2018 , respectively. As of September 30, 2019 , there was $131,000 of total unrecognized compensation expense related to restricted shares of Common Stock which will be recognized over the next year. |
EARNINGS PER SHARE (''EPS'')
EARNINGS PER SHARE (''EPS'') | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
EARNINGS PER SHARE ("EPS") | EARNINGS PER SHARE ("EPS") The computations of basic EPS are based on our weighted average shares outstanding. The basic weighted average number of shares of Common Stock outstanding was 14,598,000 and 14,598,000 for the three months ended September 30, 2019 and 2018 , respectively, and 14,598,000 and 14,597,000 for the nine months ended September 30, 2019 and 2018 , respectively. In order to calculate the diluted weighted average number of shares of Common Stock outstanding for the three and nine months ended September 30, 2019 , the basic weighted average number of shares of Common Stock outstanding was increased by 1,000 and 1,227,000 , respectively, to reflect the dilutive effect of certain shares of our Series A Preferred Stock. The computation of diluted EPS does not include outstanding shares of Series A Preferred Stock for the three and nine months ended September 30, 2018 because their impact was deemed to be anti-dilutive. Outstanding Series A Preferred Warrants were not included in the computation of diluted EPS for the three and nine months ended September 30, 2019 and 2018 because their impact was either anti-dilutive or such warrants were not exercisable during such periods (Note 11). Outstanding shares of Series L Preferred Stock were not included in the computation of diluted EPS for the three and nine months ended September 30, 2019 and 2018 because such shares were not redeemable during such periods. EPS for the year-to-date period may differ from the sum of quarterly EPS amounts due to the required method for computing EPS in the respective periods. In addition, EPS is calculated independently for each component and may not be additive due to rounding. The following table reconciles the numerator and denominator used in computing our basic and diluted per-share amounts for net (loss) income attributable to common stockholders for the three and nine months ended September 30, 2019 and 2018 : Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands, except per share amounts) Numerator: Net (loss) income attributable to common stockholders $ (1,622 ) $ (4,448 ) $ 334,269 $ (9,350 ) Redeemable preferred stock dividends declared on dilutive shares — — 1,917 — Diluted net (loss) income attributable to common stockholders $ (1,622 ) $ (4,448 ) $ 336,186 $ (9,350 ) Denominator: Basic weighted average shares of Common Stock outstanding 14,598 14,598 14,598 14,597 Effect of dilutive securities—contingently issuable shares 1 — 1,227 — Diluted weighted average shares and common stock equivalents outstanding 14,599 14,598 15,825 14,597 Net (loss) income attributable to common stockholders per share: Basic $ (0.11 ) $ (0.30 ) $ 22.90 $ (0.64 ) Diluted $ (0.11 ) $ (0.30 ) $ 21.24 $ (0.64 ) |
REDEEMABLE PREFERRED STOCK
REDEEMABLE PREFERRED STOCK | 9 Months Ended |
Sep. 30, 2019 | |
Temporary Equity Disclosure [Abstract] | |
REDEEMABLE PREFERRED STOCK | REDEEMABLE PREFERRED STOCK Series A Preferred Stock —We have an effective registration statement with the SEC with respect to the offer and sale of up to $900,000,000 of units (collectively, the "Series A Preferred Units"), with each Series A Preferred Unit consisting of (i) one share of Series A Preferred Stock, par value $0.001 per share, of the Company (collectively, the "Series A Preferred Stock") with an initial stated value of $25.00 per share (the "Series A Preferred Stock Stated Value"), subject to adjustment, and (ii) one warrant (collectively, the "Series A Preferred Warrants") to purchase 0.25 of a share of Common Stock (Note 11). The registration statement allows us to sell up to a maximum of 36,000,000 Series A Preferred Units. Our Series A Preferred Stock ranks senior to our Common Stock with respect to payment of dividends and distributions of amounts upon liquidation, dissolution or winding up. Proceeds and expenses from the sale of the Series A Preferred Units are allocated to the Series A Preferred Stock and Series A Preferred Warrants using their relative fair values on the date of issuance. Our Series A Preferred Stock is redeemable at the option of the holder (the "Series A Preferred Stock Holder") or CIM Commercial. The redemption schedule of the Series A Preferred Stock allows redemptions at the option of the Series A Preferred Stock Holder from the date of original issuance of any given shares of Series A Preferred Stock through the second year at the Series A Preferred Stock Stated Value, plus accrued and unpaid dividends, subject to the payment of a 13.0% redemption fee. After year two, the redemption fee decreases to 10.0% and after year five there is no redemption fee. Also, CIM Commercial has the right to redeem the Series A Preferred Stock after year five at the Series A Preferred Stock Stated Value, plus accrued and unpaid dividends. At the Company's discretion, redemptions will be paid in cash or, on or after the first anniversary of the issuance of such shares of Series A Preferred Stock, an equal value of Common Stock based on the volume weighted average price of our Common Stock for the 20 trading days prior to the redemption. As of September 30, 2019 , we had issued 4,104,867 Series A Preferred Units and received gross proceeds of $102,620,000 ( $101,987,000 of which were allocated to the Series A Preferred Stock and the remaining $633,000 were allocated to the Series A Preferred Warrants). In connection with such issuance, costs specifically identifiable to the offering of Series A Preferred Units, such as commissions, dealer manager fees and other offering fees and expenses, totaled $8,102,000 ( $7,969,000 of which were allocated to the Series A Preferred Stock and the remaining $133,000 were allocated to the Series A Preferred Warrants). In addition, as of September 30, 2019 , non-issuance-specific costs related to this offering totaled $5,360,000 . As of September 30, 2019 , we have reclassified and allocated $603,000 and $4,000 from deferred rent receivable and charges to Series A Preferred Stock and Series A Preferred Warrants, respectively, as a reduction to the gross proceeds received. Such reclassification was based on the cumulative number of Series A Preferred Units issued relative to the maximum number of Series A Preferred Units expected to be issued under the offering. As of September 30, 2019 , 12,887 shares of Series A Preferred Stock had been redeemed. On the first anniversary of the date of original issuance of a particular share of Series A Preferred Stock, we reclassify such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date. As of September 30, 2019 , we have reclassified an aggregate of $56,033,000 in net proceeds from temporary equity to permanent equity. Holders of Series A Preferred Stock are entitled to receive, if, as and when authorized by our Board of Directors, and declared by us out of legally available funds, cumulative cash dividends on each share of Series A Preferred Stock at an annual rate of 5.5% of the Series A Preferred Stock Stated Value (i.e., the equivalent of $0.34375 per share per quarter). Dividends on each share of Series A Preferred Stock begin accruing on, and are cumulative from, the date of issuance. Cash dividends declared on our Series A Preferred Stock for the nine months ended September 30, 2019 and 2018 consist of the following: Declaration Date Payment Date Number of Shares Cash Dividends Declared (in thousands) August 8, 2019 October 15, 2019 4,091,980 $ 1,318 June 4, 2019 July 15, 2019 3,601,721 $ 1,150 February 20, 2019 April 15, 2019 3,149,924 $ 1,010 August 22, 2018 October 15, 2018 2,457,119 $ 769 June 4, 2018 July 16, 2018 2,149,863 $ 662 March 6, 2018 April 16, 2018 1,674,841 $ 493 Series L Preferred Stock —On November 21, 2017 , we issued 8,080,740 shares of Series L Preferred Stock having an initial stated value of $28.37 per share ("Series L Preferred Stock Stated Value"), subject to adjustment. We received gross proceeds of $229,251,000 from the sale of the Series L Preferred Stock, which was reduced by issuance-specific offering costs, such as commissions, dealer manager fees, and other offering fees and expenses, totaling $15,928,000 , a discount of $2,946,000 , and non-issuance-specific costs of $2,532,000 . These fees have been recorded as a reduction to the gross proceeds in permanent equity. Our Series L Preferred Stock ranks senior to our Common Stock with respect to distributions of amounts upon liquidation, dissolution or winding up and junior to our Series A Preferred Stock and Common Stock with respect to the payment of dividends. From and after the fifth anniversary of the date of original issuance of the Series L Preferred Stock, each holder will have the right to require the Company to redeem, and the Company will also have the option to redeem (subject to certain conditions), such shares of Series L Preferred Stock at a redemption price equal to the Series L Preferred Stock Stated Value, plus, provided certain conditions are met, all accrued and unpaid distributions. Notwithstanding the foregoing, a holder of shares of our Series L Preferred Stock may require us to redeem such shares at any time prior to the fifth anniversary of the date of original issuance of the Series L Preferred Stock if (1) we do not declare and pay in full the distribution on the Series L Preferred Stock for any annual period prior to such fifth anniversary or (2) we do not declare and pay all accrued and unpaid distributions on the Series L Preferred Stock for all past dividend periods prior to the applicable holder redemption date. The applicable redemption price payable upon redemption of any Series L Preferred Stock will be made, in the Company's sole discretion, in the form of (A) cash in ILS at the then-current currency exchange rate determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, (B) in equal value through the issuance of shares of Common Stock, with the value of such Common Stock to be deemed the lower of (i) the NAV per share of our Common Stock as most recently published by the Company as of the effective date of redemption and (ii) the volume-weighted average price of our Common Stock, determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, or (C) in a combination of cash in ILS and our Common Stock, based on the conversion mechanisms set forth in (A) and (B), respectively. As of September 30, 2019 , no shares of Series L Preferred Stock have been redeemed. Holders of Series L Preferred Stock are entitled to receive, if, as and when authorized by our Board of Directors, and declared by us out of legally available funds, cumulative cash dividends on each share of Series L Preferred Stock at an annual rate of 5.5% of the Series L Preferred Stock Stated Value (i.e., the equivalent of $1.56035 per share per year). Dividends on each share of Series L Preferred Stock began accruing on, and are cumulative from, the date of issuance. Cash dividends on shares of Series L Preferred Stock are paid annually, with the first distribution paid in January 2019 for the period from the date of issuance through December 31, 2018. If the Company fails to timely declare distributions or fails to timely pay distributions on the Series L Preferred Stock, the annual dividend rate of the Series L Preferred Stock will temporarily increase by 1.0% per year, up to a maximum rate of 8.5% . Accumulated cash dividends on our Series L Preferred Stock for the three and nine months ended September 30, 2019 and 2018 , are included in the numerator for purposes of calculating basic and diluted net income (loss) attributable to common stockholders per share (Note 9), and consist of the following: Accumulation Period Dividends Start Date End Date Number of Shares Accumulated (in thousands) July 1, 2019 September 30, 2019 8,080,740 $ 3,152 April 1, 2019 June 30, 2019 8,080,740 $ 3,152 January 1, 2019 March 31, 2019 8,080,740 $ 3,152 July 1, 2018 September 30, 2018 8,080,740 $ 3,152 April 1, 2018 June 30, 2018 8,080,740 $ 3,152 January 1, 2018 March 31, 2018 8,080,740 $ 3,152 Until the fifth anniversary of the date of original issuance of our Series L Preferred Stock, we are prohibited from issuing any shares of preferred stock ranking senior to or on parity with the Series L Preferred Stock with respect to the payment of dividends, other distributions, liquidation, and or dissolution or winding up of the Company unless the Minimum Fixed Charge Coverage Ratio, calculated in accordance with the Articles Supplementary describing the Series L Preferred Stock, is equal to or greater than 1.25 :1.00. At September 30, 2019 and December 31, 2018 , we were in compliance with the Series L Preferred Stock Minimum Fixed Charge Coverage Ratio. Tender Offer On October 22, 2019 , we commenced a cash tender offer (the "Tender Offer") to purchase up to 2,693,580 shares of Series L Preferred Stock, representing one-third of the outstanding shares of Series L Preferred Stock, at a purchase price of $29.12 per share, to be paid in ILS. The Tender Offer expires on November 20, 2019 (the “Expiration Date”), unless extended or earlier terminated by us. On the terms and subject to the conditions of the Tender Offer, for each share of Series L Preferred Stock properly tendered and accepted by us, we will cause to be paid to the tendering holder as promptly as practicable following the Expiration Date the purchase price of $29.12 per share (of which $1.39 reflects the amount of dividends on the Series L Preferred Stock that will be accrued as of the Expiration Date), as converted to and to be paid in ILS. To fund the maximum aggregate purchase price of the Tender Offer, we placed in escrow $78,545,000 , which was primarily funded from borrowings under the revolving credit facility (Note 7). |
STOCKHOLDERS' EQUITY
STOCKHOLDERS' EQUITY | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity Note [Abstract] | |
STOCKHOLDERS' EQUITY | STOCKHOLDERS' EQUITY Dividends Cash dividends per share of Common Stock declared during the nine months ended September 30, 2019 and 2018 consist of the following: Declaration Date Payment Date Type Cash Dividend Per Common Share (1) August 8, 2019 September 18, 2019 Regular Quarterly $ 0.07500 August 8, 2019 August 30, 2019 Special Cash $ 42.00000 June 4, 2019 June 27, 2019 Regular Quarterly $ 0.37500 February 20, 2019 March 25, 2019 Regular Quarterly $ 0.37500 August 22, 2018 September 25, 2018 Regular Quarterly $ 0.37500 June 4, 2018 June 28, 2018 Regular Quarterly $ 0.37500 March 6, 2018 March 29, 2018 Regular Quarterly $ 0.37500 (1) Amounts have been adjusted to give retroactive effect to the Reverse Stock Split. On December 18, 2017 , we declared a special cash dividend of $2.19 per share of Common Stock ( $0.73 per share prior to the Reverse Stock Split), or $1,575,000 in the aggregate, which was paid on January 11, 2018 to stockholders of record on December 29, 2017 . This special cash dividend allowed common stockholders that did not participate in the December 18, 2017 private repurchase to receive the economic benefit of such repurchase. Pursuant to the December 18, 2017 private repurchase, the Company repurchased in a privately negotiated transaction, canceled and retired 4,696,969 shares of Common Stock from Urban Partners II, LLC ("Urban II"), a fund managed by an affiliate of CIM Group, the Administrator and the Operator of CIM Commercial (each as defined in Note 14), and an affiliate of CIM REIT and CIM Urban, for an aggregate purchase price of $310,000,000 , or $66.00 per share. Urban II waived its right to receive the January 11, 2018 special cash dividend. On August 30, 2019, in connection with the Program to Unlock Embedded Value in Our Portfolio and Improve Trading Liquidity of Our Common Stock, as defined in "Item 2 —Management's Discussion and Analysis of Financial Condition and Results of Operations" of this Quarterly Report on Form 10-Q, we paid a special cash dividend of $42.00 per share of Common Stock ( $14.00 per share of Common Stock prior to the Reverse Stock Split) (the “Special Dividend”), or $613,294,000 in the aggregate, to stockholders of record at the close of business on August 19, 2019. The Special Dividend was funded primarily by the net proceeds (after the repayment of debt) received from the sale of ten properties during 2019 (Note 3) and borrowings on our revolving credit facility. Series A Preferred Warrants Each Series A Preferred Unit consists of (i) one share of Series A Preferred Stock (Note 10) and (ii) one Series A Preferred Warrant (Note 10) which allows the holder to purchase 0.25 of a share of Common Stock. The Series A Preferred Warrants are exercisable beginning on the first anniversary of the date of their original issuance until and including the fifth anniversary of the date of such issuance. The exercise price of each Series A Preferred Warrant is at a 15.0% premium to the per share estimated NAV of our Common Stock (as most recently published and designated as the Applicable NAV by us at the time of each issuance of Series A Preferred Warrants). The exercise price of each Series A Preferred Warrant issued prior to the Reverse Stock Split has been amended to account for the effect of the Reverse Stock Split and the Special Dividend. Proceeds and expenses from the sale of the Series A Preferred Units are allocated to the Series A Preferred Stock and Series A Preferred Warrants using their relative fair values on the date of issuance. As of September 30, 2019 , we had issued 4,104,867 Series A Preferred Warrants in connection with our offering of Series A Preferred Units and allocated net proceeds of $496,000 , after specifically identifiable offering costs and allocated general offering costs, to the Series A Preferred Warrants in permanent equity. |
DERIVATIVE FINANCIAL INSTRUMENT
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES Hedges of Interest Rate Risk In order to manage financing costs and interest rate exposure related to the one-month LIBOR indexed variable rate borrowings, on August 13, 2015, we entered into ten interest rate swap agreements with multiple counterparties totaling $385,000,000 of notional value. These swap agreements became effective on November 2, 2015. During the year ended December 31, 2017 , we repaid $215,000,000 of outstanding one-month LIBOR indexed variable rate borrowings and we terminated seven interest rate swaps with an aggregate notional value of $215,000,000 , for which we received termination payments, net of fees, of $973,000 . On December 28, 2018 , we repaid $40,000,000 of outstanding one-month LIBOR indexed variable rate borrowings and we terminated one interest rate swap with a notional value of $50,000,000 , for which we received a termination payment, net of fees, of $684,000 . On March 11, 2019 , we repaid $120,000,000 of outstanding one-month LIBOR indexed variable rate borrowings (Note 7) and we terminated our two remaining interest rate swaps with an aggregate notional value of $120,000,000 , for which we received aggregate termination payments, net of fees, of $1,302,000 . The fair value of our two remaining swaps at the time of termination was $1,421,000 resulting in a net loss of $0 and $119,000 , which was recorded as a net increase to interest expense on our consolidated statements of operations for the three and nine months ended September 30, 2019 , respectively. Each of our interest rate swap agreements initially met the criteria for cash flow hedge accounting treatment and we had designated the interest rate swap agreements as cash flow hedges of the risk of variability attributable to changes in the one-month LIBOR. Accordingly, the interest rate swaps were recorded on our consolidated balance sheets at fair value, and prior to August 1, 2018, the changes in the fair value of the swaps were recorded in OCI and reclassified to earnings as an adjustment to interest expense as interest became receivable or payable (Note 2). On July 31, 2018, we determined the hedged forecasted transaction was no longer probable of occurring so all subsequent changes in the fair value of our interest rate swaps were included in interest expense on our consolidated statements of operations. The balance in AOCI as of July 31, 2018 was reclassified to earnings as an adjustment to interest expense on our consolidated statements of operations as the originally designated forecasted transaction affected earnings. For the three and nine months ended September 30, 2019 , $0 and $1,806,000 , respectively, was reclassified from AOCI and decreased interest expense on our consolidated statements of operations, which included a write off of $1,580,000 at the time our two remaining interest rate swaps were terminated. For each of the three and nine months ended September 30, 2018 , $320,000 was reclassified from AOCI and decreased interest expense on our consolidated statements of operations. Beginning on August 1, 2018, changes in the fair value of the swaps were recorded in interest expense on our consolidated statements of operations. For the three and nine months ended September 30, 2019 , $0 and $209,000 , respectively, was included as an increase in interest expense on our consolidated statements of operations related to the change in the fair value of our interest rate swaps. For each of the three and nine months ended September 30, 2018 , $70,000 is included as an increase in interest expense on our consolidated statements of operations related to the change in the fair value of our interest rate swaps. Credit-Risk-Related Contingent Features Each of our interest rate swap agreements contained a provision under which we could also be declared in default under such agreements if we defaulted on the revolving credit facility or if we defaulted on the term loan facility. As of March 11, 2019 , the date of termination of such swaps, and December 31, 2018 , there have been no events of default under our interest rate swap agreements. Impact of Hedges on AOCI and Consolidated Statements of Operations The changes in the balance of each component of AOCI related to our interest rate swaps designated as cash flow hedges are as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands) Accumulated other comprehensive income, at beginning of period $ — $ 3,221 $ 1,806 $ 1,631 Other comprehensive income before reclassifications — 214 — 1,973 Amounts reclassified to accumulated other comprehensive income (1) — (397 ) (1,806 ) (566 ) Net current period other comprehensive income — (183 ) (1,806 ) 1,407 Accumulated other comprehensive income, at end of period $ — $ 3,038 $ — $ 3,038 (1) The amounts from AOCI were reclassified as a decrease to interest expense in our consolidated statements of operations. Reclassifications from AOCI As of July 31, 2018, the hedged forecasted transaction was no longer probable of occurring so the interest rate swaps were no longer eligible for hedge accounting and all future changes in fair value of the interest rate swaps were recorded in interest expense on our consolidated statements of operations and no further amounts were deferred into AOCI. The balance in AOCI as of July 31, 2018 was reclassified to earnings as an adjustment to interest expense on our consolidated statements of operations as the originally designated forecasted transaction affected earnings. On March 11, 2019, the remaining balance in AOCI was reclassified to earnings as a decrease to interest expense on our consolidated statements of operations in connection with the termination of our two remaining interest rate swaps. |
FAIR VALUE OF FINANCIAL INSTRUM
FAIR VALUE OF FINANCIAL INSTRUMENTS | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE OF FINANCIAL INSTRUMENTS | FAIR VALUE OF FINANCIAL INSTRUMENTS We determine the estimated fair value of financial assets and liabilities utilizing a hierarchy of valuation techniques based on whether the inputs to a fair value measurement are considered to be observable or unobservable in a marketplace. The hierarchy for inputs used in measuring fair value is as follows: Level 1 Inputs —Quoted prices in active markets for identical assets or liabilities Level 2 Inputs —Observable inputs other than quoted prices in active markets for identical assets and liabilities Level 3 Inputs —Unobservable inputs In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, for disclosure purposes, the level within which the fair value measurement is categorized is based on the lowest level input that is significant to the fair value measurement. Our derivative financial instruments (Note 12) were measured at fair value on a recurring basis and were presented on our consolidated balance sheets at fair value, on a gross basis, excluding accrued interest. The table below presents the fair value of our derivative financial instruments as well as their classification on our consolidated balance sheets: September 30, 2019 December 31, 2018 Level Balance Sheet (in thousands) Assets: Interest rate swaps $ — $ 1,630 2 Other assets Interest Rate Swaps —We estimated the fair value of our interest rate swaps by calculating the credit-adjusted present value of the expected future cash flows of each swap. The calculation incorporated the contractual terms of the derivatives, observable market interest rates which we considered to be Level 2 inputs, and credit risk adjustments, if any, to reflect the counterparty's as well as our own nonperformance risk. The estimated fair values of those financial instruments which are not recorded at fair value on a recurring basis on our consolidated balance sheets are as follows: September 30, 2019 December 31, 2018 Carrying Estimated Carrying Estimated Level (in thousands) Assets: SBA 7(a) loans receivable, subject to loan-backed notes $ 31,404 $ 32,658 $ 37,031 $ 38,357 3 SBA 7(a) loans receivable, subject to credit risk 26,257 27,310 29,748 30,630 3 SBA 7(a) loans receivable, subject to secured borrowings 13,915 14,015 16,469 16,706 3 Liabilities: Mortgages payable (1) 96,919 101,258 386,923 377,364 3 Junior subordinated notes 25,278 24,410 25,215 24,462 3 (1) The December 31, 2018 carrying amount and estimated fair value of mortgages payable exclude one mortgage loan with carrying value of $28,018,000 that had been classified as liabilities associated with assets held for sale, net, on our consolidated balance sheet at December 31, 2018 (Notes 3 and 7). Management's estimation of the fair value of our financial instruments other than our interest rate swaps is based on a Level 3 valuation in the fair value hierarchy established for disclosure of how a company values its financial instruments. In general, quoted market prices from active markets for the identical financial instrument (Level 1 inputs), if available, should be used to value a financial instrument. If quoted prices are not available for the identical financial instrument, then a determination should be made if Level 2 inputs are available. Level 2 inputs include quoted prices for similar financial instruments in active markets for identical or similar financial instruments in markets that are not active (i.e., markets in which there are few transactions for the financial instruments, the prices are not current, price quotations vary substantially, or in which little information is released publicly). There is limited reliable market information for our financial instruments and we utilize other methodologies based on unobservable inputs for valuation purposes since there are no Level 1 or Level 2 inputs available. Accordingly, Level 3 inputs are used to measure fair value. In general, estimates of fair value may differ from the carrying amounts of the financial assets and liabilities primarily as a result of the effects of discounting future cash flows. Considerable judgment is required to interpret market data and develop estimates of fair value. Accordingly, the estimates presented are made at a point in time and may not be indicative of the amounts we could realize in a current market exchange. The carrying amounts of our secured borrowings—government guaranteed loans, SBA 7(a) loan-backed notes and revolving credit facility approximate their fair values, as the interest rates on these securities are variable and approximate current market interest rates. SBA 7(a) Loans Receivable, Subject to Loan-Backed Notes —These loans receivable represent the unguaranteed portions of loans originated under the SBA 7(a) Program which were transferred to a trust and are held as collateral in connection with a securitization transaction. The proceeds from the transfer have been recorded as SBA 7(a) loan-backed notes payable. In order to determine the estimated fair value of these loans receivable, we use a present value technique for the anticipated future cash flows using certain assumptions. At September 30, 2019 , our assumptions included discount rates ranging from 7.25% to 9.00% and prepayment rates ranging from 12.10% to 17.50% . At December 31, 2018 , our assumptions included discount rates ranging from 6.75% to 9.25% and prepayment rates ranging from 9.59% to 17.50% . SBA 7(a) Loans Receivable, Subject to Credit Risk —Loans receivable were initially recorded at estimated fair value at the Acquisition Date. Loans receivable originated subsequent to the Acquisition Date are recorded at cost upon origination and adjusted by net loan origination fees and discounts. In order to determine the estimated fair value of our loans receivable, we use a present value technique for the anticipated future cash flows using certain assumptions. At September 30, 2019 , our assumptions included discount rates ranging from 6.75% to 9.50% and prepayment rates ranging from 8.03% to 17.50% . At December 31, 2018 , our assumptions included discount rates ranging from 6.75% to 9.75% and prepayment rates ranging from 4.91% to 17.50% . SBA 7(a) Loans Receivable, Subject to Secured Borrowings —These loans receivable represent the government guaranteed portion of loans which were sold with the proceeds received from the sale reflected as secured borrowings—government guaranteed loans. There is no credit risk associated with these loans since the SBA has guaranteed payment of the principal. In order to determine the estimated fair value of these loans receivable, we use a present value technique for the anticipated future cash flows taking into consideration the lack of credit risk. At September 30, 2019 , our assumptions included discount rates ranging from 8.50% to 9.25% and prepayment rates ranging from and 10.29% to 17.50% . At December 31, 2018 , our assumptions included discount rates ranging from 8.75% to 9.50% and prepayment rates ranging from and 10.29% to 17.50% . Mortgages Payable —The fair values of mortgages payable are estimated based on current interest rates available for debt instruments with similar terms. The fair value of our mortgages payable is sensitive to fluctuations in interest rates. Discounted cash flow analysis is generally used to estimate the fair value of our mortgages payable, using a rate of 3.44% at September 30, 2019 , and rates ranging from 4.62% to 4.64% at December 31, 2018 . Junior Subordinated Notes —The fair value of the junior subordinated notes is estimated based on current interest rates available for debt instruments with similar terms. Discounted cash flow analysis is generally used to estimate the fair value of our junior subordinated notes. The rate used was 6.34% and 7.05% at September 30, 2019 and December 31, 2018 , respectively. |
RELATED-PARTY TRANSACTIONS
RELATED-PARTY TRANSACTIONS | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS | RELATED-PARTY TRANSACTIONS Asset Management and Other Fees to Related Parties In December 2015, CIM Urban and CIM Investment Advisors, LLC, an affiliate of CIM REIT and CIM Group, entered into an investment management agreement, pursuant to which CIM Urban engaged CIM Investment Advisors, LLC to provide certain services to CIM Urban (the “Investment Management Agreement”). CIM Investment Advisors, LLC changed its name to CIM Capital, LLC in December 2018, and, on January 1, 2019, assigned its duties under the Investment Management Agreement to its four wholly-owned subsidiaries: CIM Capital Securities Management, LLC, a securities manager, CIM Capital RE Debt Management, LLC, a debt manager, CIM Capital Controlled Company Management, LLC, a controlled company manager, and CIM Capital Real Property Management, LLC, a real property manager. The "Operator" refers to CIM Investment Advisors, LLC from December 10, 2015 to December 31, 2018 and to CIM Capital, LLC and its four wholly-owned subsidiaries on and after January 1, 2019. CIM Urban pays asset management fees to the Operator on a quarterly basis in arrears. The fee is calculated as a percentage of the daily average adjusted fair value of CIM Urban's assets: Daily Average Adjusted Fair Quarterly Fee From Greater of To and Including (in thousands) $ — $ 500,000 0.2500% 500,000 1,000,000 0.2375% 1,000,000 1,500,000 0.2250% 1,500,000 4,000,000 0.2125% 4,000,000 20,000,000 0.1000% The Operator earned asset management fees of $2,424,000 and $4,475,000 for the three months ended September 30, 2019 and 2018 , respectively, and $9,669,000 and $13,350,000 for the nine months ended September 30, 2019 and 2018 , respectively. At September 30, 2019 and December 31, 2018 , asset management fees of $2,457,000 and $4,540,000 , respectively, were due to the Operator. CIM Management, Inc. and certain of its affiliates (collectively, the "CIM Management Entities"), all affiliates of CIM REIT and CIM Group, provide property management, leasing, and development services to CIM Urban. The CIM Management Entities earned property management fees, which are included in rental and other property operating expenses, totaling $494,000 and $1,084,000 for the three months ended September 30, 2019 and 2018 , respectively, and $2,106,000 and $3,289,000 for the nine months ended September 30, 2019 and 2018 , respectively. CIM Urban also reimbursed the CIM Management Entities $837,000 and $1,256,000 for the three months ended September 30, 2019 and 2018 , respectively, and $3,873,000 and $4,523,000 for the nine months ended September 30, 2019 and 2018 , respectively, for onsite management costs incurred on behalf of CIM Urban, which are included in rental and other property operating expenses. The CIM Management Entities earned leasing commissions of $32,000 and $67,000 for the three months ended September 30, 2019 and 2018 , respectively, and $610,000 and $286,000 for the nine months ended September 30, 2019 and 2018 , respectively, which were capitalized to deferred charges. In addition, the CIM Management Entities earned construction management fees of $160,000 and $65,000 for the three months ended September 30, 2019 and 2018 , respectively, and $329,000 and $506,000 for the nine months ended September 30, 2019 and 2018 , respectively, which were capitalized to investments in real estate. At September 30, 2019 and December 31, 2018 , fees payable and expense reimbursements due to the CIM Management Entities of $2,454,000 and $3,202,000 , respectively, are included in due to related parties. Also included in due from and to related parties as of September 30, 2019 and December 31, 2018 , were $40,000 due from and $315,000 due to, respectively, the CIM Management Entities and certain of its affiliates. On March 11, 2014, CIM Commercial and its subsidiaries entered into a master services agreement (the "Master Services Agreement") with CIM Service Provider, LLC (the "Administrator"), an affiliate of CIM Group, pursuant to which the Administrator has agreed to provide, or arrange for other service providers to provide, management and administration services to CIM Commercial and its subsidiaries. Pursuant to the Master Services Agreement, we appointed an affiliate of CIM Group as the administrator of Urban Partners GP, LLC. Under the Master Services Agreement, CIM Commercial pays a base service fee (the "Base Service Fee") to the Administrator initially set at $1,000,000 per year (subject to an annual escalation by a specified inflation factor beginning on January 1, 2015), payable quarterly in arrears. The Administrator earned a Base Service Fee of $275,000 and $270,000 for the three months ended September 30, 2019 and 2018 , respectively, and $827,000 and $809,000 for the nine months ended September 30, 2019 and 2018 , respectively. In addition, pursuant to the terms of the Master Services Agreement, the Administrator may receive compensation and or reimbursement for performing certain services for CIM Commercial and its subsidiaries that are not covered under the Base Service Fee. During the nine months ended September 30, 2019 and 2018 , such services performed by the Administrator and its affiliates included accounting, tax, reporting, internal audit, legal, compliance, risk management, IT, human resources, corporate communications, and from and after September 2018, operational and on-going support in connection with our offering of Series A Preferred Units. The Administrator's compensation is based on the salaries and benefits of the employees of the Administrator and or its affiliates who performed these services (allocated based on the percentage of time spent on the affairs of CIM Commercial and its subsidiaries). We expensed $572,000 and $583,000 for the three months ended September 30, 2019 and 2018 , respectively, and $1,630,000 and $2,138,000 for the nine months ended September 30, 2019 and 2018 , respectively, for such services which are included in asset management and other fees to related parties. At September 30, 2019 and December 31, 2018 , $1,175,000 and $1,490,000 was due to the Administrator, respectively, for such services. On January 1, 2015, we entered into a Staffing and Reimbursement Agreement with CIM SBA Staffing, LLC ("CIM SBA"), an affiliate of CIM Group, and our subsidiary, PMC Commercial Lending, LLC. The agreement provides that CIM SBA will provide personnel and resources to us and that we will reimburse CIM SBA for the costs and expenses of providing such personnel and resources. For the three months ended September 30, 2019 and 2018 , we incurred expenses related to services subject to reimbursement by us under this agreement of $652,000 and $740,000 , respectively, which are included in asset management and other fees to related parties for lending segment costs, and $58,000 and $53,000 , respectively, for corporate services, which are included in asset management and other fees to related parties. For the nine months ended September 30, 2019 and 2018 , we incurred expenses related to such services of $1,840,000 and $1,980,000 , respectively, which are included in asset management and other fees to related parties for lending segment costs, and $189,000 and $198,000 , respectively, for corporate services, which are included in asset management and other fees to related parties. In addition, we deferred personnel costs of $38,000 and $97,000 for the three months ended September 30, 2019 and 2018 , respectively, and $82,000 and $233,000 for the nine months ended September 30, 2019 and 2018 , respectively, associated with services provided for originating loans. At September 30, 2019 and December 31, 2018 , $563,000 and $1,347,000 , respectively, was due to CIM SBA for costs and expenses of providing such personnel and resources. On May 10, 2018, the Company executed a wholesaling agreement (the "Wholesaling Agreement") with International Assets Advisors, LLC ("IAA") and CCO Capital, LLC ("CCO Capital"). IAA was the exclusive dealer manager for the Company’s public offering of Series A Preferred Units until May 31, 2019. CCO Capital is a registered broker dealer and is under common control with the Operator and the Administrator. Under the Wholesaling Agreement, among other things, CCO Capital, in its capacity as the wholesaler for the offering, assisted IAA with the sale of Series A Preferred Units. In exchange for such services, IAA paid CCO Capital a fee equal to 2.75% of the selling price of each Series A Preferred Unit for which a sale was completed, reduced by any applicable fee reallowances payable to soliciting dealers pursuant to separate soliciting dealer agreements between IAA and soliciting dealers. The foregoing fee was reduced, and could have been exceeded, by a fixed monthly payment by CCO Capital to IAA for IAA’s services in connection with periodic closings and settlements for the offering. On May 31, 2019, the Company, IAA and CCO Capital entered into an Amendment, Assignment and Assumption Agreement (the “Assignment Agreement”), pursuant to which CCO Capital assumed all of the rights and obligations of IAA under the dealer manager agreement, dated as of June 28, 2016, as amended, by and between the Company and IAA. As a result of the Assignment Agreement, CCO Capital became the exclusive dealer manager for the Company’s public offering of the Series A Preferred Units effective as of May 31, 2019. In connection with the execution of the Assignment Agreement, the Company terminated the Wholesaling Agreement effective as of May 31, 2019. At September 30, 2019 and December 31, 2018 , $503,000 and $200,000 , respectively, was included in deferred costs for CCO Capital fees, of which $131,000 and $138,000 , respectively, was included in due to related parties. CCO Capital incurred issuance-specific costs of $337,000 and $439,000 , which were allocated to the Series A Preferred Stock for the three and nine months ended September 30, 2019 , respectively. Other On October 1, 2015, an affiliate of CIM Group entered into a 5 -year lease renewal with respect to a property owned by the Company, which lease was amended to a month-to-month term in February 2019. We recorded rental and other property income related to this tenant of $28,000 and $27,000 for the three months ended September 30, 2019 and 2018 , respectively, and $83,000 and $81,000 for the nine months ended September 30, 2019 and 2018 , respectively. On May 15, 2019, CIM Group entered into an approximately eleven -year lease for approximately 32,000 rentable square feet with respect to a property owned by the Company. The lease was amended on August 7, 2019 to reduce the rentable square feet to approximately 30,000 rentable square feet. For the three and nine months ended September 30, 2019 , we recorded rental and other property income related to this tenant of $356,000 and $562,000 , respectively. In October 2019, our Administrator acquired 2,468,390 shares of our Common Stock, representing approximately 16.9% of the outstanding shares of our Common Stock, for $19.1685 per share from an affiliate of CIM Group in a private transaction. As of the date hereof, CIM Group, its affiliates, and our officers and directors have an aggregate economic interest in approximately 19.2% of the outstanding shares of our Common Stock. |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 9 Months Ended |
Sep. 30, 2019 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND CONTINGENCIES Loan Commitments —Commitments to extend credit are agreements to lend to a customer provided the terms established in the contract are met. Our outstanding loan commitments to fund loans were $14,452,000 at September 30, 2019 and are for prime-based loans to be originated by our subsidiary engaged in SBA 7(a) Program lending, the government guaranteed portion of which is intended to be sold. Commitments generally have fixed expiration dates. Since some commitments are expected to expire without being drawn upon, total commitment amounts do not necessarily represent future cash requirements. General —In connection with the ownership and operation of real estate properties, we have certain obligations for the payment of tenant improvement allowances and lease commissions in connection with new leases and renewals. CIM Commercial had a total of $8,827,000 in future obligations under leases to fund tenant improvements and other future construction obligations at September 30, 2019 . At September 30, 2019 , $2,813,000 was funded to reserve accounts included in restricted cash on our consolidated balance sheet for these tenant improvement obligations in connection with the mortgage loan agreement entered into in June 2016. Employment Agreements —We have employment agreements with two of our officers. Under certain circumstances, each of these employment agreements provides for (1) severance payment equal to the annual base salary paid to the officer and (2) death and disability payments in an amount equal to two times and one time, respectively, the annual base salary paid to the officers. Litigation —We are not currently involved in any material pending or threatened legal proceedings nor, to our knowledge, are any material legal proceedings currently threatened against us, other than routine litigation arising in the ordinary course of business. In the normal course of business, we are periodically party to certain legal actions and proceedings involving matters that are generally incidental to our business. While the outcome of these legal actions and proceedings cannot be predicted with certainty, in management's opinion, the resolution of these legal proceedings and actions will not have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations or to maintain our level of distributions on our Common Stock or Preferred Stock. In September 2018, we filed a lawsuit against the City and County of San Francisco seeking a refund of the $11,845,000 in penalties, interest and legal fees paid by us for real property transfer tax allegedly due for a transaction in a prior year. We disputed that such penalties, interest and legal fees were payable but, in order to contest the asserted tax obligations, we had to pay such amounts to the City and County of San Francisco in August 2017. We intend to vigorously pursue this litigation. A subsidiary of the Company is a defendant in a lawsuit in connection with injuries sustained by a third-party contractor at a property previously owned by such subsidiary. While it is possible that a loss may be incurred, we are unable to estimate a range of potential losses due to the complexity and current status of the lawsuit. However, we maintain insurance coverage to mitigate the impact of adverse exposures in lawsuits of this nature and do not expect this lawsuit to have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations or to maintain our level of distributions on our Common Stock or Preferred Stock. SBA Related —If the SBA establishes that a loss on an SBA guaranteed loan is attributable to significant technical deficiencies in the manner in which the loan was originated, funded or serviced under the SBA 7(a) Program, the SBA may seek recovery of the principal loss related to the deficiency from us. With respect to the guaranteed portion of SBA loans that have been sold, the SBA will first honor its guarantee and then seek compensation from us in the event that a loss is deemed to be attributable to technical deficiencies. Based on historical experience, we do not expect that this contingency is probable to be asserted. However, if asserted, it could have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations or to maintain our level of distributions on our Common Stock or Preferred Stock. Environmental Matters —In connection with the ownership and operation of real estate properties, we may be potentially liable for costs and damages related to environmental matters, including asbestos-containing materials. We have not been notified by any governmental authority of any noncompliance, liability, or other claim in connection with any of the properties, and we are not aware of any other environmental condition with respect to any of the properties that management believes will have a material adverse effect on our business, financial condition, results of operations, cash flow or our ability to satisfy our debt service obligations or to maintain our level of distributions on our Common Stock or Preferred Stock. Rent Expense —We lease office space in Dallas, Texas under a lease which, as amended, expires in May 2020. In determining whether this contract constitutes a lease, we determined that the office space is explicitly identified in the contract. Additionally, so long as payments are made timely under this lease, we as the tenant have the right to obtain substantially all the economic benefits from the use of this identified asset and can direct how and for what purpose the office space is used to conduct our operations. As of September 30, 2019 , the right-of-use asset and lease liability balance was approximately $170,000 . The right-of-use asset is included within other assets and the lease liability is included within other liabilities on our consolidated balance sheet. We recorded rent expense of $69,000 and $65,000 for the three months ended September 30, 2019 and 2018 , respectively, and $224,000 and $182,000 for the nine months ended September 30, 2019 and 2018 , respectively, in general and administrative expenses on our consolidated statements of operations. At September 30, 2019 , our scheduled future noncancelable minimum lease payments were $64,000 for the three months ending December 31, 2019 and $106,000 for the year ending December 31, 2020. |
FUTURE MINIMUM LEASE RENTALS
FUTURE MINIMUM LEASE RENTALS | 9 Months Ended |
Sep. 30, 2019 | |
Leases, Operating [Abstract] | |
FUTURE MINIMUM LEASE RENTALS | FUTURE MINIMUM LEASE RENTALS Future minimum rental revenue under long-term operating leases at September 30, 2019 , excluding tenant reimbursements of certain costs, are as follows: Years Ending December 31, Total (in thousands) 2019 (Three months ending December 31, 2019) $ 12,237 2020 46,706 2021 40,832 2022 37,465 2023 34,370 Thereafter 83,981 $ 255,591 |
CONCENTRATIONS
CONCENTRATIONS | 9 Months Ended |
Sep. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
CONCENTRATIONS | CONCENTRATIONS Tenant Revenue Concentrations —Rental and other property income from Kaiser Foundation Health Plan, Incorporated ("Kaiser"), which occupied space in two of our Oakland, California properties, accounted for approximately 22.2% and 13.1% of our office segment revenues for the three months ended September 30, 2019 and 2018 , respectively, and 15.6% and 13.0% for the nine months ended September 30, 2019 and 2018 , respectively. At September 30, 2019 and December 31, 2018 , $132,000 and $331,000 , respectively, was due from Kaiser. Rental and other property income from the U.S. General Services Administration and other government agencies (collectively, "Governmental Tenants"), which primarily occupied space in our properties located in Washington, D.C., accounted for approximately 11.2% and 25.3% of our office segment revenues for the three months ended September 30, 2019 and 2018 , respectively, and 20.0% and 25.4% for the nine months ended September 30, 2019 and 2018 , respectively. At September 30, 2019 and December 31, 2018 , $768,000 and $2,899,000 , respectively, was due from Governmental Tenants. Geographical Concentrations of Investments in Real Estate —As of September 30, 2019 and December 31, 2018 , we owned 8 and 16 office properties, respectively, one hotel property, one and two parking garages, respectively, and one and two development sites, respectively, one of which is being used as a parking lot. These properties are located in two states and Washington, D.C. Our revenue concentrations from properties are as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 California 84.1 % 76.2 % 77.7 % 76.9 % Texas 7.4 3.5 5.1 3.3 Washington, D.C. 8.5 20.3 17.2 19.8 100.0 % 100.0 % 100.0 % 100.0 % Our real estate investments concentrations from properties are as follows: September 30, 2019 December 31, 2018 California (1) 94.8 % 70.6 % Texas 5.2 2.2 Washington, D.C. — 27.2 100.0 % 100.0 % (1) The December 31, 2018 percentage for California includes the assets of 260 Townsend Street, which was classified as held for sale on our consolidated balance sheet at December 31, 2018 and sold in March 2019 (Note 3). |
SEGMENT DISCLOSURE
SEGMENT DISCLOSURE | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
SEGMENT DISCLOSURE | SEGMENT DISCLOSURE In accordance with ASC Topic 280, Segment Reporting , our reportable segments during the three and nine months ended September 30, 2019 and 2018 consist of two types of commercial real estate properties, namely, office and hotel, as well as a segment for our lending business. Management internally evaluates the operating performance and financial results of the segments based on net operating income. We also have certain general and administrative level activities, including public company expenses, legal, accounting, and tax preparation that are not considered separate operating segments. The reportable segments are accounted for on the same basis of accounting as described in the notes to our audited consolidated financial statements for the year ended December 31, 2018 included in our Annual Report on Form 10-K filed with the SEC on March 18, 2019. For our real estate segments, we define net operating income as rental and other property income and expense reimbursements less property related expenses, and excludes non-property income and expenses, interest expense, depreciation and amortization, corporate related general and administrative expenses, gain (loss) on sale of real estate, gain (loss) on early extinguishment of debt, impairment of real estate, transaction costs, and provision for income taxes. For our lending segment, we define net operating income as interest income net of interest expense and general overhead expenses. The net operating income of our segments for the three and nine months ended September 30, 2019 and 2018 is as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands) Office: Revenues $ 16,885 $ 36,440 $ 72,380 $ 109,141 Property expenses: Operating 7,205 14,459 29,677 39,770 General and administrative 41 83 397 1,062 Total property expenses 7,246 14,542 30,074 40,832 Segment net operating income—office 9,639 21,898 42,306 68,309 Hotel: Revenues 8,511 8,542 29,430 29,980 Property expenses: Operating 6,081 5,946 19,520 19,316 General and administrative 31 — 108 18 Total property expenses 6,112 5,946 19,628 19,334 Segment net operating income—hotel 2,399 2,596 9,802 10,646 Lending: Revenues 2,411 2,625 8,312 8,324 Lending expenses: Interest expense 365 633 1,483 1,117 Fees to related party 652 740 1,840 1,980 General and administrative 505 414 1,343 1,273 Total lending expenses 1,522 1,787 4,666 4,370 Segment net operating income—lending 889 838 3,646 3,954 Total segment net operating income $ 12,927 $ 25,332 $ 55,754 $ 82,909 A reconciliation of our segment net operating income to net income attributable to the Company for the three and nine months ended September 30, 2019 and 2018 is as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands) Total segment net operating income $ 12,927 $ 25,332 $ 55,754 $ 82,909 Interest and other income 1,408 — 3,226 — Asset management and other fees to related parties (3,329 ) (5,381 ) (12,315 ) (16,495 ) Interest expense (2,038 ) (6,332 ) (7,515 ) (19,292 ) General and administrative (807 ) (708 ) (2,945 ) (4,143 ) Transaction costs (340 ) (15 ) (600 ) (359 ) Depreciation and amortization (5,180 ) (13,310 ) (21,995 ) (39,783 ) Loss on early extinguishment of debt — — (29,982 ) — Impairment of real estate — — (69,000 ) — Gain on sale of real estate 302 — 433,104 — Income (loss) before provision for income taxes 2,943 (414 ) 347,732 2,837 Provision for income taxes (87 ) (115 ) (686 ) (795 ) Net income (loss) 2,856 (529 ) 347,046 2,042 Net (income) loss attributable to noncontrolling interests (8 ) 1 165 (15 ) Net income (loss) attributable to the Company $ 2,848 $ (528 ) $ 347,211 $ 2,027 The condensed assets for each of the segments as of September 30, 2019 and December 31, 2018 , along with capital expenditures and loan originations for the nine months ended September 30, 2019 and 2018 , are as follows: September 30, 2019 December 31, 2018 (in thousands) Condensed assets: Office (1) $ 458,979 $ 1,094,269 Hotel 105,478 105,845 Lending 84,588 97,465 Non-segment assets 10,807 44,822 Total assets $ 659,852 $ 1,342,401 Nine Months Ended 2019 2018 (in thousands) Capital expenditures (2): Office (1) $ 9,500 $ 11,462 Hotel 1,846 1,343 Total capital expenditures 11,346 12,805 Loan originations 27,421 53,320 Total capital expenditures and loan originations $ 38,767 $ 66,125 (1) The December 31, 2018 balances include the assets of 260 Townsend Street, which was classified as held for sale on our consolidated balance sheet at December 31, 2018 and sold in March 2019 (Note 3). (2) Represents additions and improvements to real estate investments, excluding acquisitions. Includes the activity for dispositions through their respective disposition dates. |
PRO FORMA FINANCIAL INFORMATION
PRO FORMA FINANCIAL INFORMATION | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
PRO FORMA FINANCIAL INFORMATION | PRO FORMA FINANCIAL INFORMATION The table set forth below summarizes, on a pro forma basis, the revenue, net income (loss), net income (loss) attributable to the Company, net (loss) income attributable to common stockholders, and basic and diluted per-share amounts for net (loss) income attributable to common stockholders for the three and nine months ended September 30, 2019 and 2018 , after giving effect to the disposition of the Union Square Properties, which was completed on July 30, 2019 , as if the transaction had occurred on January 1, 2018. This pro forma information does not purport to represent what the actual revenue, net income (loss), net income (loss) attributable to the Company, net (loss) income attributable to common stockholders, and basic and diluted per-share amounts for net (loss) income attributable to common stockholders would have been for the periods indicated, nor does it purport to predict the results of operations for future periods. Other than with respect to the sale of the Union Square Properties, the pro forma information does not reflect other events affecting the Company, including the sales of other properties, and other events described in "Item 2 —Management's Discussion and Analysis of Financial Condition and Results of Operations— Program to Unlock Embedded Value in Our Portfolio and Improve Trading Liquidity of Our Common Stock." Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in thousands, except per share amounts) Pro forma revenue $ 27,047 $ 41,193 $ 97,971 $ 128,074 Pro forma net income (loss) 1,513 (1,124 ) 412,341 102 Pro forma net income (loss) attributable to the Company 1,510 (1,131 ) 412,310 65 Pro forma net (loss) income attributable to common stockholders (2,960 ) (5,051 ) 399,368 (11,312 ) Pro forma net (loss) income attributable to common stockholders per share, basic $ (0.20 ) $ (0.35 ) $ 27.36 $ (0.77 ) Pro forma net (loss) income attributable to common stockholders per share, diluted $ (0.20 ) $ (0.35 ) $ 25.36 $ (0.77 ) |
BASIS OF PRESENTATION AND SUM_2
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 9 Months Ended |
Sep. 30, 2019 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Interim Financial Information | Interim Financial Information —The accompanying interim consolidated financial statements of CIM Commercial have been prepared by our management in accordance with accounting principles generally accepted in the United States of America ("GAAP"). Certain information and note disclosures required for annual financial statements have been condensed or excluded pursuant to SEC rules and regulations. Accordingly, the interim consolidated financial statements do not include all of the information and notes required by GAAP for complete financial statements. The accompanying financial information reflects all adjustments which are, in the opinion of our management, of a normal recurring nature and necessary for a fair presentation of our financial position, results of operations and cash flows for the interim periods. Operating results for the three and nine months ended September 30, 2019 are not necessarily indicative of the results that may be expected for the year ending December 31, 2019 . Our accompanying interim consolidated financial statements should be read in conjunction with our audited consolidated financial statements and the notes thereto, included in our Annual Report on Form 10-K filed with the SEC on March 18, 2019 . |
Principles of Consolidation | Principles of Consolidation —The consolidated financial statements include the accounts of CIM Commercial and its subsidiaries. All intercompany transactions and balances have been eliminated in consolidation. |
Investments in Real Estate | Investments in Real Estate —Real estate acquisitions are recorded at cost as of the acquisition date. Costs related to the acquisition of properties were expensed as incurred for acquisitions that occurred prior to October 1, 2017. For any acquisition occurring on or after October 1, 2017, we have conducted and will conduct an analysis to determine if the acquisition constitutes a business combination or an asset purchase. If the acquisition constitutes a business combination, then the transaction costs will be expensed as incurred, and if the acquisition constitutes an asset purchase, then the transaction costs will be capitalized. Investments in real estate are stated at depreciated cost. Depreciation and amortization are recorded on a straight-line basis over the estimated useful lives as follows: Buildings and improvements 15 - 40 years Furniture, fixtures, and equipment 3 - 5 years Tenant improvements Shorter of the useful lives or the We capitalize project costs, including pre-construction costs, interest expense, property taxes, insurance, and other costs directly related and essential to the development, redevelopment, or construction of a project, while activities are ongoing to prepare an asset for its intended use. Costs incurred after a project is substantially complete and ready for its intended use are expensed as incurred. Improvements and replacements are capitalized when they extend the useful life, increase capacity, or improve the efficiency of the asset. Ordinary repairs and maintenance are expensed as incurred. Investments in real estate are evaluated for impairment on a quarterly basis or whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is measured by a comparison of the carrying amount to the future net cash flows, undiscounted and without interest, expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amount of the assets exceeds the estimated fair value of the assets. The estimated fair value of the asset group identified for step two of the impairment testing under GAAP is based on either the income approach, with market discount rate, terminal capitalization rate and rental rate assumptions being most critical to such analysis, or on the sales comparison approach to similar properties. Assets held for sale are reported at the lower of the asset's carrying amount or fair value, less costs to sell. |
Derivative Financial Instruments | Derivative Financial Instruments —As part of risk management and operational strategies, from time to time, we may enter into derivative contracts with various counterparties. All derivatives are recognized on the balance sheet at their estimated fair value. On the date that we enter into a derivative contract, we designate the derivative as a fair value hedge, a cash flow hedge, a foreign currency fair value or cash flow hedge, a hedge of a net investment in a foreign operation, or a trading or non-hedging instrument. Changes in the estimated fair value of a derivative that is highly effective and that is designated and qualifies as a cash flow hedge, to the extent that the hedge is effective, are initially recorded in other comprehensive income ("OCI"), and are subsequently reclassified into earnings as a component of interest expense when the variability of cash flows of the hedged transaction affects earnings (e.g., when periodic settlements of a variable-rate asset or liability are recorded in earnings). Any hedge ineffectiveness (which represents the amount by which the changes in the estimated fair value of the derivative differ from the variability in the cash flows of the forecasted transaction) is recognized in current-period earnings as a component of interest expense. When an interest rate swap designated as a cash flow hedge no longer qualifies for hedge accounting, we recognize changes in the estimated fair value of the hedge previously deferred to accumulated other comprehensive income ("AOCI"), along with any changes in estimated fair value occurring thereafter, through earnings. We classify cash flows from interest rate swap agreements as net cash provided by operating activities on the consolidated statements of cash flows as our accounting policy is to present the cash flows from the hedging instruments in the same category in the consolidated statements of cash flows as the category for the cash flows from the hedged items. See Note 12 for disclosures about our derivative financial instruments and hedging activities. |
Revenue Recognition | Revenue Recognition —We use a five-step model to recognize revenue for contracts with customers. The five-step model requires that we (i) identify the contract with the customer, (ii) identify the performance obligations in the contract, (iii) determine the transaction price, including variable consideration to the extent that it is probable that a significant future reversal will not occur, (iv) allocate the transaction price to the performance obligations in the contract, and (v) recognize revenue when (or as) we satisfy the performance obligation. Revenue from leasing activities We operate as a lessor of real estate assets, primarily in Class A and creative office assets. In determining whether our contracts with our tenants constitute leases, we determined that our contracts explicitly identify the premises and that any substitution rights to relocate the tenant to other premises within the same building stated in the contract are not substantive. Additionally, so long as payments are made timely under these contracts, our tenants have the right to obtain substantially all the economic benefits from the use of this identified asset and can direct how and for what purpose the premises are used to conduct their operations. Therefore, our contracts with our tenants constitute leases. All leases are classified as operating leases and minimum rents are recognized on a straight-line basis over the terms of the leases when collectability is reasonably assured and the tenant has taken possession or controls the physical use of the leased asset. The excess of rents recognized over amounts contractually due pursuant to the underlying leases is recorded as deferred rent. If the lease provides for tenant improvements, we determine whether the tenant improvements, for accounting purposes, are owned by the tenant or us. When we are the owner of the tenant improvements, the tenant is not considered to have taken physical possession or have control of the physical use of the leased asset until the tenant improvements are substantially completed. When the tenant is considered the owner of the improvements, any tenant improvement allowance that is funded is treated as an incentive. Lease incentives paid to tenants are included in other assets and amortized as a reduction to rental revenue on a straight-line basis over the term of the related lease. Reimbursements from tenants, consisting of amounts due from tenants for common area maintenance, real estate taxes, insurance, and other recoverable costs, are recognized as revenue in the period the expenses are incurred. Tenant reimbursements are recognized and presented on a gross basis when we are primarily responsible for fulfilling the promise to provide the specified good or service and control that specified good or service before it is transferred to the tenant. We have elected not to separate lease and non-lease components as the pattern of revenue recognition does not differ for the two components, and the non-lease component is not the primary component in our leases. In addition to minimum rents, certain leases provide for additional rents based upon varying percentages of tenants’ sales in excess of annual minimums. Percentage rent is recognized once lessees’ specified sales targets have been met. We derive parking revenues from leases with third-party operators. Our parking leases provide for additional rents based upon varying percentages of tenants’ sales in excess of annual minimums. Parking percentage rent is recognized once lessees’ specific sales targets have been met. Revenue from lending activities Interest income included in interest and other income is comprised of interest earned on loans and our short-term investments and the accretion of net loan origination fees and discounts. Interest income on loans is accrued as earned with the accrual of interest suspended when the related loan becomes a Non-Accrual Loan (as defined below). Revenue from hotel activities Hotel revenue is recognized upon establishment of a contract with a customer. At contract inception, the Company assesses the goods and services promised in its contracts with customers and identifies a performance obligation for each promise to transfer to the customer a good or service (or bundle of goods or services) that is distinct. To identify the performance obligations, the Company considers all of the goods or services promised in the contract regardless of whether they are explicitly stated or implied by customary business practices. Various performance obligations of hotel revenues can be categorized as follows: • cancellable and noncancelable room revenues from reservations and • ancillary services including facility usage and food or beverage. Cancellable reservations represent a single performance obligation of providing lodging services at the hotel. The Company satisfies its performance obligation and recognizes revenues associated with these reservations over time as services are rendered to the customer. The Company satisfies its performance obligation and recognizes revenues associated with noncancelable reservations at the earlier of (i) the date on which the customer cancels the reservation or (ii) over time as services are rendered to the customer. Ancillary services include facilities usage and providing food and beverage. The Company satisfies its performance obligation and recognizes revenues associated with these services at a point in time as the good or service is delivered to the customer. At inception of these contracts with customers for hotel revenues, the contractual price is equivalent to the transaction price as there are no elements of variable consideration to estimate. Tenant recoveries outside of the lease agreements Tenant recoveries outside of the lease agreements are related to construction projects in which our tenants have agreed to fully reimburse us for all costs related to construction. These services include architectural, permit expediter and construction services. At inception of the contract with the customer, the contractual price is equivalent to the transaction price as there are no elements of variable consideration to estimate. While these individual services are distinct, in the context of the arrangement with the customer, all of these services are bundled together and represent a single package of construction services requested by the customer. The Company satisfies its performance obligation and recognizes revenues associated with these services over time as the construction is completed. |
Loans Receivable | Loans Receivable —Our loans receivable are carried at their unamortized principal balance less unamortized acquisition discounts and premiums, retained loan discounts and loan loss reserves. For loans originated under the Small Business Administration's ("SBA") 7(a) Guaranteed Loan Program ("SBA 7(a) Program"), we sell the portion of the loan that is guaranteed by the SBA. Upon sale of the SBA guaranteed portion of the loans, which are accounted for as sales, the unguaranteed portion of the loan retained by us is valued on a fair value basis and a discount is recorded as a reduction in basis of the retained portion of the loan. Unamortized retained loan discounts were $7,673,000 and $7,234,000 as of September 30, 2019 and December 31, 2018 , respectively. At the Acquisition Date, the carrying value of our loans was adjusted to estimated fair market value and acquisition discounts of $33,907,000 were recorded, which are being accreted to interest and other income using the effective interest method. We sold substantially all of our commercial mortgage loans with unamortized acquisition discounts of $15,951,000 to an unrelated third-party in December 2015. Acquisition discounts of $774,000 and $884,000 remained as of September 30, 2019 and December 31, 2018 , respectively. A loan receivable is generally classified as non-accrual (a "Non-Accrual Loan") if (i) it is past due as to payment of principal or interest for a period of 60 days or more, (ii) any portion of the loan is classified as doubtful or is charged-off or (iii) the repayment in full of the principal and or interest is in doubt. Generally, loans are charged-off when management determines that we will be unable to collect any remaining amounts due under the loan agreement, either through liquidation of collateral or other means. Interest income, included in interest and other income, on a Non-Accrual Loan is recognized on either the cash basis or the cost recovery basis. On a quarterly basis, and more frequently if indicators exist, we evaluate the collectability of our loans receivable. Our evaluation of collectability involves judgment, estimates, and a review of the ability of the borrower to make principal and interest payments, the underlying collateral and the borrowers' business models and future operations in accordance with Accounting Standards Codification ("ASC") 450-20, Contingencies—Loss Contingencies , and ASC 310-10, Receivables . For the three and nine months ended September 30, 2019 , we recorded $140,000 and $82,000 , respectively, of impairment on our loans receivable. For the three and nine months ended September 30, 2018 , we recorded no impairment on our loans receivable. We establish a general loan loss reserve when available information indicates that it is probable a loss has occurred based on the carrying value of the portfolio and the amount of the loss can be reasonably estimated. Significant judgment is required in determining the general loan loss reserve, including estimates of the likelihood of default and the estimated fair value of the collateral. The general loan loss reserve includes those loans, which may have negative characteristics which have not yet become known to us. In addition to the reserves established on loans not considered impaired that have been evaluated under a specific evaluation, we establish the general loan loss reserve using a consistent methodology to determine a loss percentage to be applied to loan balances. These loss percentages are based on many factors, primarily cumulative and recent loss history and general economic conditions. |
Deferred Rent Receivable and Charges | Deferred Rent Receivable and Charges —Deferred rent receivable and charges consist of deferred rent, deferred leasing costs, deferred offering costs (Note 10) and other deferred costs. Deferred rent receivable is $19,463,000 and $52,366,000 at September 30, 2019 and December 31, 2018 , respectively. Deferred leasing costs, which represent lease commissions and other direct costs associated with the acquisition of tenants, are capitalized and amortized on a straight-line basis over the terms of the related leases. Deferred leasing costs of $16,771,000 and $51,152,000 are presented net of accumulated amortization of $7,125,000 and $23,910,000 at September 30, 2019 and December 31, 2018 , respectively. Deferred offering costs represent direct costs incurred in connection with our offering of Series A Preferred Units (as defined in Note 10), excluding costs specifically identifiable to a closing, such as commissions, dealer-manager fees, and other offering fees and expenses. For a specific issuance of Series A Preferred Units, issuance-specific offering costs are recorded as a reduction of proceeds raised on the issuance date. Offering costs incurred but not directly related to a specifically identifiable closing are deferred. Deferred offering costs are first allocated to each issuance on a pro-rata basis equal to the ratio of Series A Preferred Units issued in an issuance to the maximum number of Series A Preferred Units that are expected to be issued. Then, the issuance-specific offering costs and the deferred offering costs allocated to such issuance are further allocated to the Series A Preferred Stock (as defined in Note 10) and Series A Preferred Warrants (as defined in Note 10) issued in such issuance based on the relative fair value of the instruments on the date of issuance. The deferred offering costs allocated to the Series A Preferred Stock and Series A Preferred Warrants are reductions to temporary equity and permanent equity, respectively. |
Redeemable Preferred Stock | Redeemable Preferred Stock —Beginning on the date of original issuance of any given shares of Series A Preferred Stock (Note 10), the holder of such shares has the right to require the Company to redeem such shares at a redemption price of 100% of the Series A Preferred Stock Stated Value (as defined in Note 10), plus accrued and unpaid dividends, subject to the payment of a redemption fee until the fifth anniversary of such issuance. From and after the fifth anniversary of the date of the original issuance, the holder will have the right to require the Company to redeem such shares at a redemption price of 100% of the Series A Preferred Stock Stated Value, plus accrued and unpaid dividends, without a redemption fee, and the Company will have the right (but not the obligation) to redeem such shares at 100% of the Series A Preferred Stock Stated Value, plus accrued and unpaid dividends. The applicable redemption price payable upon redemption of any Series A Preferred Stock is payable in cash or, on or after the first anniversary of the issuance of such shares of Series A Preferred Stock to be redeemed, in the Company's sole discretion, in cash or in equal value through the issuance of shares of Common Stock, based on the volume weighted average price of our Common Stock for the 20 trading days prior to the redemption. Since a holder of Series A Preferred Stock has the right to request redemption of such shares and redemptions prior to the first anniversary are to be paid in cash, we have recorded the activity related to our Series A Preferred Stock in temporary equity. We recorded the activity related to our Series A Preferred Warrants (Note 10) in permanent equity. On the first anniversary of the date of original issuance of a particular share of Series A Preferred Stock, we reclassify such share of Series A Preferred Stock from temporary equity to permanent equity because the feature giving rise to temporary equity classification, the requirement to satisfy redemption requests in cash, lapses on the first anniversary date. Proceeds and expenses from the sale of the Series A Preferred Units are allocated to the Series A Preferred Stock and the Series A Preferred Warrants using their relative fair values on the date of issuance. From and after the fifth anniversary of the date of original issuance of the Series L Preferred Stock, each holder will have the right to require the Company to redeem, and the Company will also have the option to redeem (subject to certain conditions), such shares of Series L Preferred Stock at a redemption price equal to the Series L Preferred Stock Stated Value (as defined in Note 10), plus, provided certain conditions are met, all accrued and unpaid distributions. Notwithstanding the foregoing, a holder of shares of our Series L Preferred Stock may require us to redeem such shares at any time prior to the fifth anniversary of the date of original issuance of the Series L Preferred Stock if (1) we do not declare and pay in full the distributions on the Series L Preferred Stock for any annual period prior to such fifth anniversary or (2) we do not declare and pay all accrued and unpaid distributions on the Series L Preferred Stock for all past dividend periods prior to the applicable holder redemption date. The applicable redemption price payable upon redemption of any Series L Preferred Stock will be made, in the Company's sole discretion, in the form of (A) cash in Israeli new shekels ("ILS") at the then-current currency exchange rate determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, (B) in equal value through the issuance of shares of Common Stock, with the value of such Common Stock to be deemed the lower of (i) our net asset value ("NAV") per share of our Common Stock as most recently published by the Company as of the effective date of redemption and (ii) the volume-weighted average price of our Common Stock, determined in accordance with the Articles Supplementary defining the terms of the Series L Preferred Stock, or (C) in a combination of cash in ILS and our Common Stock, based on the conversion mechanisms set forth in (A) and (B), respectively. We recorded the activity related to our Series L Preferred Stock in permanent equity. |
Noncontrolling Interests | Noncontrolling Interests —Noncontrolling interests represent the interests in various properties owned by third-parties. |
Restricted Cash | Restricted Cash —Our mortgage loan and hotel management agreements provide for depositing cash into restricted accounts reserved for capital expenditures, free rent, tenant improvement and leasing commission obligations. Restricted cash also includes cash required to be segregated in connection with certain of our loans receivable. |
Reclassifications | Reclassifications —Certain prior period amounts have been reclassified to conform with the current period presentation. With the adoption of Accounting Standards Update ("ASU") 2016-02, Leases (Topic 842) and the election of the lessor practical expedient not to separate lease and non-lease components, $1,857,000 and $6,248,000 of expense reimbursements were reclassified as rental and other property income on the consolidated statements of operations for the three and nine months ended September 30, 2018 , respectively, and $272,000 and $841,000 of non-lease component expense reimbursements recognized under the revenue recognition guidance were reclassified as interest and other income on the consolidated statements of operations for the three and nine months ended September 30, 2018 , respectively. Under the new leasing guidance, bad debt expense associated with changes in the collectability assessment for operating leases shall be recorded as adjustments to rental and other property income rather than rental and other property operating expenses. The impact of this reclassification resulted in a $33,000 and $152,000 reclassification from rental and other property expenses to rental and other property income on the consolidated statements of operations for the three and nine months ended September 30, 2018 , respectively. |
Assets Held for Sale and Discontinued Operations | Assets Held for Sale and Discontinued Operations —In the ordinary course of business, we may periodically enter into agreements to dispose of our assets. Some of these agreements are non-binding because either they do not obligate either party to pursue any transactions until the execution of a definitive agreement or they provide the potential buyer with the ability to terminate without penalty or forfeiture of any material deposit, subject to certain specified contingencies, such as completion of due diligence at the discretion of such buyer. We do not classify assets that are subject to such non-binding agreements as held for sale. We classify assets as held for sale, if material, when they meet the necessary criteria, which include: a) management commits to and actively embarks upon a plan to sell the assets, b) the assets to be sold are available for immediate sale in their present condition, c) the sale is expected to be completed within one year under terms usual and customary for such sales and d) actions required to complete the plan indicate that it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn. We generally believe that we meet these criteria when the plan for sale has been approved by our Board of Directors, there are no known significant contingencies related to the sale and management believes it is probable that the sale will be completed within one year. Assets held for sale are recorded at the lower of cost or estimated fair value less cost to sell. In addition, if we were to determine that the asset disposal associated with assets held for sale or disposed of represents a strategic shift, the revenues, expenses and net gain (loss) on dispositions would be recorded in discontinued operations for all periods presented through the date of the applicable disposition. |
Consolidation Considerations for Our Investments in Real Estate | Consolidation Considerations for Our Investments in Real Estate —ASC 810-10, Consolidation , addresses how a business enterprise should evaluate whether it has a controlling interest in an entity through means other than voting rights that would require the entity to be consolidated. We analyze our investments in real estate in accordance with this accounting standard to determine whether they are variable interest entities, and if so, whether we are the primary beneficiary. Our judgment with respect to our level of influence or control over an entity and whether we are the primary beneficiary of a variable interest entity involves consideration of various factors, including the form of our ownership interest, our voting interest, the size of our investment (including loans), and our ability to participate in major policy-making decisions. Our ability to correctly assess our influence or control over an entity affects the presentation of these investments in real estate on our consolidated financial statements. |
Use of Estimates | Use of Estimates —The preparation of consolidated financial statements in conformity with GAAP requires management to make certain estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements —In February 2016, the Financial Accounting Standards Board ("FASB") issued ASU No. 2016-02, Leases (Topic 842) , which was intended to improve financial reporting about leasing transactions. Under the new guidance, a lessee was required to recognize assets and liabilities for leases with lease terms of more than 12 months. Consistent with previous GAAP, the recognition, measurement, and presentation of expenses and cash flows arising from a lease by a lessee primarily depended on its classification as a finance or operating lease. However, unlike previous GAAP, which required a lessee to recognize only capital leases on the balance sheet, the new ASU required a lessee to recognize both types of leases on the balance sheet. The lessor accounting remained largely unchanged from previous GAAP. However, the ASU contained some targeted improvements that were intended to align, where necessary, lessor accounting with the lessee accounting model and with the updated revenue recognition guidance issued in 2014. In July 2018, the FASB issued ASU No. 2018-10, Leases (Topic 842) , which contained targeted improvements to amend inconsistencies and clarified guidance that was brought about by stakeholders. Furthermore, in July 2018, the FASB issued ASU 2018-11, Leases (Topic 842) , which provided the following practical expedients to entities: (1) a transition method that allowed entities to apply the new standard at the adoption date and to recognize a cumulative-effect adjustment to the opening balance of retained earnings effective at the adoption date; and (2) the option for lessors to not separate lease and non-lease components provided that certain criteria were met. In December 2018, the FASB issued ASU 2018-20, Leases (Topic 842) , which provided lessors the option to elect to account for sales and other similar taxes in which the lessee directly pays third-parties to be excluded from the measurement of the contract consideration. In March 2019, the FASB issued ASU 2019-01, Leases (Topic 842) , which provided narrow amendments, including clarification on transition disclosures to certain aspects of ASU 2016-02. For public entities, these ASUs were effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2018. The guidance provided a package of transition practical expedients, which must be elected as a package and applied consistently by an entity to all of its leases (including those for which the entity is a lessee or a lessor) when applying this guidance to leases that commenced before the effective date of January 1, 2019: (1) An entity need not reassess whether any expired or existing contracts are or contain leases; (2) an entity need not reassess the lease classification for any expired or existing leases (that is, all leases that were classified as operating leases prior to January 1, 2019 remain classified as operating leases); and (3) an entity need not reassess initial direct costs for any existing leases. The Company elected all the aforementioned transition practical expedients, including the expedients provided under ASU 2018-11. From a lessee's perspective, the Company determined that there is one office lease for our lending segment that is material to the consolidated balance sheet. Based on our assessment, the lease had been classified as an operating lease and the Company recorded approximately $362,000 as a right-of-use asset and lease liability on the consolidated balance sheet on the effective date of January 1, 2019. As of September 30, 2019 , the right-of-use asset and lease liability balance were each approximately $170,000 . From a lessor's perspective, the Company did not record a cumulative effect adjustment on January 1, 2019 as the aforementioned package of practical expedients allowed us to continue accounting for our then-existing or expired leases under the previous accounting guidance, and we applied the new lease accounting guidance to leases that commenced or are modified after the effective date of January 1, 2019. Leases commenced or modified after the effective date have been, and we expect future commencements and modifications of leases in the future will continue to be, classified as operating leases and that we will qualify for the lessor practical expedient provided under ASU 2018-11 to not separate lease and non-lease components. Additionally, if following the effective date, our tenants have made or make payments for taxes or insurance directly to a third-party on behalf of the Company as the lessor, we have excluded and will exclude these amounts from the measurement of the contract consideration and consider these lessee costs. Otherwise, any recoveries of these costs are and will be recognized as lease revenue on a gross basis in our consolidated income statements. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments , which is intended to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments and other commitments to extend credit held by a reporting entity. The amendments in the ASU replace the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. In November 2018, the FASB issued ASU No. 2018-19, Financial Instruments-Credit Losses (Topic 326): Codification Improvements to Topic 326, Financial Instruments-Credit Losses, which clarified that receivables arising from operating leases are not within the scope of the credit losses standards. In April 2019, the FASB issued ASU 2019-04, Financial Instruments-Credit Losses (Topic 326): Codification Improvements to Topic 326, Financial Instruments-Credit Losses , which clarified the following: (i) an entity’s estimate of expected credit losses should include expected recoveries of financial assets, including recoveries of amounts expected to be written off and those previously written off, and (ii) an entity should consider contractual extension or renewal options that it cannot unconditionally cancel when determining the contractual term over which expected credit losses are measured. In May 2019, the FASB issued ASU No. 2019-05, Financial Instruments-Credit Losses (Topic 326): Targeted Transition Relief , which allows entities to irrevocably elect the fair value option for existing financial assets on an instrument-by-instrument basis upon adoption of ASU 2016-13. Except for existing held-to-maturity debt securities, the alternative is available for all instruments in the scope of ASC 326-20 that are eligible for the fair value option in ASC 825-10. If an entity elects the fair value option, it will recognize a cumulative-effect adjustment for the difference between the fair value of the instrument and its carrying value. In October 2019, the FASB approved the deferral of the effective date of Topic 326 for certain entities, including smaller reporting companies, public entities that are not SEC filers, and entities that are not public business entities. For public entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2019. For smaller reporting companies, public entities that are not SEC filers, and entities that are not public business entities, the ASU is effective for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2022. Early adoption is permitted for annual reporting periods (including interim reporting periods within those periods) beginning after December 15, 2018. We are currently in the process of evaluating the impact of adoption of this new accounting guidance on our consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Targeted Improvements to Accounting for Hedging Activities , which simplified and expanded the eligible hedging strategies for financial and nonfinancial risks by more closely aligning hedge accounting with a company’s risk management activities, and also simplified the application of Topic 815, Derivatives and Hedging , through targeted improvements in key practice areas. In addition, the ASU prescribed how hedging results should be presented and required incremental disclosures. Further, the ASU provided partial relief on the timing of certain aspects of hedge documentation and eliminated the requirement to recognize hedge ineffectiveness separately in earnings in the current period. For public entities, the ASU was effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2018. The Company has evaluated the guidance and determined that the effects of ASU 2017-12 did not have a material impact on our consolidated financial statements. In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement , which eliminates, adds and modifies certain disclosure requirements for fair value measurements. Entities will no longer be required to disclose the amount of and reasons for transfers between Level 1 and Level 2 of the fair value hierarchy, but public entities will be required to disclose the range and weighted average used to develop significant unobservable inputs for Level 3 fair value measurements. For public entities, the ASU is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2019. Early adoption is permitted in any interim period after issuance of the ASU. The Company has evaluated the guidance and determined that the effects of ASU 2018-13 is not expected to have a material impact on our consolidated financial statements. In October 2018, the FASB issued ASU No. 2018-16, Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (the “SOFR”) Overnight Index Swap (“OIS”) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes . The guidance permits the use of the OIS rate based on the SOFR as a U.S. benchmark rate for purposes of applying hedge accounting. The SOFR is a volume-weighted median interest rate that is calculated daily based on overnight transactions from the prior day’s activity in specified segments of the U.S. Treasury repo market. It has been selected as the preferred replacement for the U.S. dollar London Interbank Offered Rate ("LIBOR"), which will be phased out by the end of 2021. For public entities, the ASU is effective for annual reporting periods (including interim periods within those periods) beginning after December 15, 2019. Early adoption is permitted in any interim period after issuance of the ASU. The Company has evaluated the guidance and determined that the effects of ASU 2018-16 is not expected to have a material impact on our consolidated financial statements. |
BASIS OF PRESENTATION AND SUM_3
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Useful Lives of Real Estate | Depreciation and amortization are recorded on a straight-line basis over the estimated useful lives as follows: Buildings and improvements 15 - 40 years Furniture, fixtures, and equipment 3 - 5 years Tenant improvements Shorter of the useful lives or the |
Schedule of Recognized Rental Income | For the three and nine months ended September 30, 2019 and 2018 , we recognized rental income as follows: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in thousands) Rental and other property income Fixed lease payments (1) $ 15,389 $ 34,108 $ 66,925 $ 101,423 Variable lease payments (2) 1,917 2,498 6,381 8,152 Rental and other property income $ 17,306 $ 36,606 $ 73,306 $ 109,575 (1) Fixed lease payments include contractual rents under lease agreements with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above-market leases, below-market leases and lease incentives. (2) Variable lease payments include expense reimbursements billed to tenants and percentage rent, net of bad debt expense from our operating leases. |
Reconciliation of Hotel Revenue | Below is a reconciliation of the hotel revenue from contracts with customers to the total hotel segment revenue disclosed in Note 18: Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in thousands) Hotel properties Hotel income $ 7,734 $ 7,715 $ 27,087 $ 27,564 Rental and other property income 736 777 2,208 2,273 Interest and other income 41 50 135 143 Hotel revenues $ 8,511 $ 8,542 $ 29,430 $ 29,980 |
ACQUISITIONS AND DISPOSITIONS (
ACQUISITIONS AND DISPOSITIONS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Business Combinations [Abstract] | |
Schedule of Assets Sold and Held for Sale | The following is the detail of the carrying amounts of assets and liabilities at the time of the sales of the properties that occurred during the nine months ended September 30, 2019 : (in thousands) Assets Investments in real estate, net $ 476,532 Deferred rent receivable and charges, net 55,297 Other intangible assets, net 316 Other assets 4,096 Total assets $ 536,241 Liabilities Debt, net (1) (2) $ 318,072 Total liabilities $ 318,072 (1) Debt is presented net of deferred loan costs of $1,704,000 and accumulated amortization of $576,000 . (2) A mortgage loan with an outstanding principal balance of $28,200,000 was assumed by the buyer in connection with the sale of our property in San Francisco, California. A mortgage loan with an outstanding principal balance of $46,000,000 was prepaid in connection with the sale in March 2019 of our property in Washington, D.C. that was collateral for the loan. Mortgage loans with an aggregate outstanding principal balance of $205,500,000 were legally defeased in connection with the sale of the March Oakland Properties that were collateral for the loans. A mortgage loan with an outstanding principal balance of $39,500,000 was legally defeased in connection with the sale in May 2019 of our property in Oakland, California that was collateral for the loan. The following is the detail of the carrying amounts of assets and liabilities for the office properties that are classified as held for sale on our consolidated balance sheet as of December 31, 2018 : December 31, 2018 (in thousands) Assets Investments in real estate, net (1) $ 17,123 Cash and cash equivalents 755 Accounts receivable, net 41 Deferred rent receivable and charges, net (2) 4,009 Other intangible assets, net (3) 220 Other assets 27 Total assets held for sale, net $ 22,175 Liabilities Debt, net (4) $ 28,018 Accounts payable and accrued expenses 370 Due to related parties 81 Other liabilities 297 Total liabilities associated with assets held for sale, net $ 28,766 (1) Investments in real estate of $24,832,000 is presented net of accumulated depreciation of $7,709,000 . (2) Deferred rent receivable and charges consist of deferred rent receivable of $2,909,000 and deferred leasing costs of $1,669,000 net of accumulated amortization of $569,000 . (3) Other intangible assets, net, represent acquired in-place leases of $1,778,000 , which are presented net of accumulated amortization of $1,558,000 . (4) Debt, net, includes the outstanding principal balance of 260 Townsend Street of $28,200,000 , net of deferred loan costs of $243,000 and accumulated amortization of $61,000 . We sold 100% fee-simple interests in the following properties to unrelated third-parties during the nine months ended September 30, 2019 . Transaction costs related to these sales were expensed as incurred. Property Asset Type Date of Sale Square Feet Sales Price Transaction Costs Gain on Sale (in thousands) March Oakland Properties, Office / Parking Garage March 1, 2019 975,596 $ 512,016 $ 8,971 $ 289,779 830 1st Street, Office March 1, 2019 247,337 116,550 2,438 45,710 260 Townsend Street, Office March 14, 2019 66,682 66,000 2,539 42,092 1333 Broadway, Office May 16, 2019 254,523 115,430 658 55,221 Union Square Properties, Office / Land July 30, 2019 630,650 181,000 3,744 302 $ 990,996 $ 18,350 $ 433,104 (1) The "March Oakland Properties" consist of 1901 Harrison Street, 2100 Franklin Street, 2101 Webster Street, and 2353 Webster Street Parking Garage. (2) The "Union Square Properties" consist of 999 North Capitol Street, 899 North Capitol Street and 901 North Capitol Street. Prior to the sale, we determined that the book values of such properties exceeded their estimated fair values and recognized an impairment charge of $0 and $69,000,000 for the three and nine months ended September 30, 2019 (Note 2). Our determination of the fair values of these properties was based on negotiations with the third-party buyer and the contract sales price. The gain on sale includes $113,000 of extinguishment of noncontrolling interests as a result of the sale. |
Schedule of Asset Acquisitions | Property Asset Type Date of Acquisition Square Feet Purchase Price (1) (in thousands) 9460 Wilshire Boulevard, Beverly Hills, CA Office January 18, 2018 91,750 $ 132,000 (1) In December 2017, at the time we entered into the purchase and sale agreement, we made a $20,000,000 non-refundable deposit to an escrow account that was included in other assets on our consolidated balance sheet at December 31, 2017. Transaction costs that were capitalized in connection with the acquisition of this property totaled $48,000 , which are not included in the purchase price above. |
Schedule of Fair Value of Net Assets Acquired | The fair value of the net assets acquired for the aforementioned acquisition during the nine months ended September 30, 2018 are as follows: (in thousands) Land $ 52,199 Land improvements 756 Buildings and improvements 74,522 Tenant improvements 1,451 Acquired in-place leases (1) 7,003 Acquired above-market leases (1) 109 Acquired below-market leases (1) (3,992 ) Net assets acquired $ 132,048 (1) Acquired in-place leases, above-market leases, and below-market leases have weighted average amortization periods of 3 years, 2 years, and 3 years, respectively. |
INVESTMENTS IN REAL ESTATE (Tab
INVESTMENTS IN REAL ESTATE (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Real Estate [Abstract] | |
Investments in Real Estate | Investments in real estate consist of the following: September 30, 2019 December 31, 2018 (in thousands) Land $ 134,421 $ 266,410 Land improvements 2,713 18,368 Buildings and improvements 437,833 912,892 Furniture, fixtures, and equipment 3,724 4,245 Tenant improvements 32,807 133,487 Work in progress 12,152 9,234 Investments in real estate 623,650 1,344,636 Accumulated depreciation (117,684 ) (303,699 ) Net investments in real estate $ 505,966 $ 1,040,937 |
LOANS RECEIVABLE (Tables)
LOANS RECEIVABLE (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Receivables [Abstract] | |
Schedule of Loans Receivable | Loans receivable consist of the following: September 30, 2019 December 31, 2018 (in thousands) SBA 7(a) loans receivable, subject to loan-backed notes $ 31,565 $ 36,847 SBA 7(a) loans receivable, subject to credit risk 25,670 29,385 SBA 7(a) loans receivable, subject to secured borrowings 13,876 16,409 Loans receivable 71,111 82,641 Deferred capitalized costs 1,147 1,309 Loan loss reserves (682 ) (702 ) Loans receivable, net $ 71,576 $ 83,248 |
OTHER INTANGIBLE ASSETS (Tables
OTHER INTANGIBLE ASSETS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Intangible Assets and Liabilities and Related Accumulated Amortization and Accretion | A schedule of our intangible assets and liabilities and related accumulated amortization and accretion as of September 30, 2019 and December 31, 2018 is as follows: Assets Liabilities September 30, 2019 Acquired Above-Market Leases Acquired Trade Name and License Acquired (in thousands) Gross balance $ 74 $ 13,653 $ 2,957 $ (3,521 ) Accumulated amortization (38 ) (8,906 ) — 1,959 $ 36 $ 4,747 $ 2,957 $ (1,562 ) Average useful life (in years) 5 8 Indefinite 4 Assets Liabilities December 31, 2018 Acquired Acquired Trade Name and License Acquired (in thousands) Gross balance $ 146 $ 16,210 $ 2,957 $ (6,618 ) Accumulated amortization (51 ) (9,731 ) — 3,746 $ 95 $ 6,479 $ 2,957 $ (2,872 ) Average useful life (in years) 3 8 Indefinite 4 |
Schedule of Future Amortization and Accretion of Acquisition Related Intangible Assets | A schedule of future amortization and accretion of acquisition related intangible assets and liabilities as of September 30, 2019 , is as follows: Assets Liabilities Years Ending December 31, Acquired Acquired Acquired (in thousands) 2019 (Three months ending December 31, 2019) $ 4 $ 476 $ (280 ) 2020 9 1,349 (701 ) 2021 5 899 (347 ) 2022 5 663 (234 ) 2023 6 375 — Thereafter 7 985 — $ 36 $ 4,747 $ (1,562 ) |
DEBT (Tables)
DEBT (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Information on our debt is as follows: September 30, 2019 December 31, 2018 (in thousands) Mortgage loan with a fixed interest rate of 4.14% per annum, with monthly payments of interest only, and a balance of $97,100,000 due on July 1, 2026. The loan is nonrecourse. On March 1, 2019, mortgage loans with an aggregate outstanding principal balance of $205,500,000 were legally defeased in connection with the sale of the properties that were collateral for the loans. On May 16, 2019, one loan with an outstanding principal balance of $39,500,000 was legally defeased in connection with the sale of the property that was collateral for the loan. $ 97,100 $ 342,100 Mortgage loan with a fixed interest rate of 4.50% per annum, with monthly payments of interest only for 10 years, and payments of interest and principal starting in February 2022. The loan had a $42,008,000 balance due on January 5, 2027. The loan was nonrecourse. On March 1, 2019, the mortgage loan was prepaid in connection with the sale of the property that was collateral for the loan. — 46,000 97,100 388,100 Deferred loan costs related to mortgage loans (181 ) (1,177 ) Total Mortgages Payable 96,919 386,923 Secured borrowing principal on SBA 7(a) loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 6.21% and 5.89% at September 30, 2019 and December 31, 2018, respectively. 8,935 11,283 Secured borrowing principal on SBA 7(a) loans sold for excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 3.82% and 3.57% at September 30, 2019 and December 31, 2018, respectively. 4,353 4,482 13,288 15,765 Unamortized premiums 727 940 Total Secured Borrowings—Government Guaranteed Loans 14,015 16,705 Revolving credit facility 68,500 130,000 SBA 7(a) loan-backed notes with a variable interest rate which resets monthly based on the lesser of the one-month LIBOR plus 1.40% or the prime rate less 1.08%, with payments of interest and principal due monthly. Balance due at maturity in March 20, 2043. 26,144 33,769 Junior subordinated notes with a variable interest rate which resets quarterly based on the three-month LIBOR plus 3.25%, with quarterly interest only payments. Balance due at maturity on March 30, 2035. 27,070 27,070 121,714 190,839 Deferred loan costs related to other debt (3,129 ) (3,941 ) Discount on junior subordinated notes (1,792 ) (1,855 ) Total Other Debt 116,793 185,043 Total Debt $ 227,727 $ 588,671 |
Future Principal Payments on Debt | Future principal payments on our debt (face value) at September 30, 2019 are as follows: Years Ending December 31, Mortgages Payable Secured Borrowings Principal (1) Other (1) (2) Total (in thousands) 2019 (Three months ending December 31, 2019) $ — $ 128 $ 1,351 $ 1,479 2020 — 529 1,844 2,373 2021 — 557 1,893 2,450 2022 — 588 70,443 71,031 2023 — 620 2,000 2,620 Thereafter 97,100 10,866 44,183 152,149 $ 97,100 $ 13,288 $ 121,714 $ 232,102 (1) Principal payments on secured borrowings and SBA 7(a) loan-backed notes, which are included in Other, are generally dependent upon cash flows received from the underlying loans. Our estimate of their repayment is based on scheduled payments on the underlying loans. Our estimate will differ from actual amounts to the extent we experience prepayments and or loan liquidations or charge-offs. No payment is due unless payments are received from the borrowers on the underlying loans. (2) Represents the junior subordinated notes, SBA 7(a) loan-backed notes, and revolving credit facility. |
EARNINGS PER SHARE ("EPS") (Tab
EARNINGS PER SHARE ("EPS") (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Earnings Per Share [Abstract] | |
Reconciliation of the Numerator and Denominator Used in Computing Basic and Diluted Per-share Computations | The following table reconciles the numerator and denominator used in computing our basic and diluted per-share amounts for net (loss) income attributable to common stockholders for the three and nine months ended September 30, 2019 and 2018 : Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands, except per share amounts) Numerator: Net (loss) income attributable to common stockholders $ (1,622 ) $ (4,448 ) $ 334,269 $ (9,350 ) Redeemable preferred stock dividends declared on dilutive shares — — 1,917 — Diluted net (loss) income attributable to common stockholders $ (1,622 ) $ (4,448 ) $ 336,186 $ (9,350 ) Denominator: Basic weighted average shares of Common Stock outstanding 14,598 14,598 14,598 14,597 Effect of dilutive securities—contingently issuable shares 1 — 1,227 — Diluted weighted average shares and common stock equivalents outstanding 14,599 14,598 15,825 14,597 Net (loss) income attributable to common stockholders per share: Basic $ (0.11 ) $ (0.30 ) $ 22.90 $ (0.64 ) Diluted $ (0.11 ) $ (0.30 ) $ 21.24 $ (0.64 ) |
REDEEMABLE PREFERRED STOCK (Tab
REDEEMABLE PREFERRED STOCK (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Temporary Equity Disclosure [Abstract] | |
Dividends Declared | Cash dividends declared on our Series A Preferred Stock for the nine months ended September 30, 2019 and 2018 consist of the following: Declaration Date Payment Date Number of Shares Cash Dividends Declared (in thousands) August 8, 2019 October 15, 2019 4,091,980 $ 1,318 June 4, 2019 July 15, 2019 3,601,721 $ 1,150 February 20, 2019 April 15, 2019 3,149,924 $ 1,010 August 22, 2018 October 15, 2018 2,457,119 $ 769 June 4, 2018 July 16, 2018 2,149,863 $ 662 March 6, 2018 April 16, 2018 1,674,841 $ 493 Cash dividends per share of Common Stock declared during the nine months ended September 30, 2019 and 2018 consist of the following: Declaration Date Payment Date Type Cash Dividend Per Common Share (1) August 8, 2019 September 18, 2019 Regular Quarterly $ 0.07500 August 8, 2019 August 30, 2019 Special Cash $ 42.00000 June 4, 2019 June 27, 2019 Regular Quarterly $ 0.37500 February 20, 2019 March 25, 2019 Regular Quarterly $ 0.37500 August 22, 2018 September 25, 2018 Regular Quarterly $ 0.37500 June 4, 2018 June 28, 2018 Regular Quarterly $ 0.37500 March 6, 2018 March 29, 2018 Regular Quarterly $ 0.37500 (1) Amounts have been adjusted to give retroactive effect to the Reverse Stock Split. |
Dividends Accumulated | Accumulated cash dividends on our Series L Preferred Stock for the three and nine months ended September 30, 2019 and 2018 , are included in the numerator for purposes of calculating basic and diluted net income (loss) attributable to common stockholders per share (Note 9), and consist of the following: Accumulation Period Dividends Start Date End Date Number of Shares Accumulated (in thousands) July 1, 2019 September 30, 2019 8,080,740 $ 3,152 April 1, 2019 June 30, 2019 8,080,740 $ 3,152 January 1, 2019 March 31, 2019 8,080,740 $ 3,152 July 1, 2018 September 30, 2018 8,080,740 $ 3,152 April 1, 2018 June 30, 2018 8,080,740 $ 3,152 January 1, 2018 March 31, 2018 8,080,740 $ 3,152 |
STOCKHOLDERS' EQUITY (Tables)
STOCKHOLDERS' EQUITY (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Stockholders' Equity Note [Abstract] | |
Dividends Declared | Cash dividends declared on our Series A Preferred Stock for the nine months ended September 30, 2019 and 2018 consist of the following: Declaration Date Payment Date Number of Shares Cash Dividends Declared (in thousands) August 8, 2019 October 15, 2019 4,091,980 $ 1,318 June 4, 2019 July 15, 2019 3,601,721 $ 1,150 February 20, 2019 April 15, 2019 3,149,924 $ 1,010 August 22, 2018 October 15, 2018 2,457,119 $ 769 June 4, 2018 July 16, 2018 2,149,863 $ 662 March 6, 2018 April 16, 2018 1,674,841 $ 493 Cash dividends per share of Common Stock declared during the nine months ended September 30, 2019 and 2018 consist of the following: Declaration Date Payment Date Type Cash Dividend Per Common Share (1) August 8, 2019 September 18, 2019 Regular Quarterly $ 0.07500 August 8, 2019 August 30, 2019 Special Cash $ 42.00000 June 4, 2019 June 27, 2019 Regular Quarterly $ 0.37500 February 20, 2019 March 25, 2019 Regular Quarterly $ 0.37500 August 22, 2018 September 25, 2018 Regular Quarterly $ 0.37500 June 4, 2018 June 28, 2018 Regular Quarterly $ 0.37500 March 6, 2018 March 29, 2018 Regular Quarterly $ 0.37500 (1) Amounts have been adjusted to give retroactive effect to the Reverse Stock Split. |
DERIVATIVE FINANCIAL INSTRUME_2
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Changes in the Balance of Each Component of AOCI Related to Interest Rate Swaps | The changes in the balance of each component of AOCI related to our interest rate swaps designated as cash flow hedges are as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands) Accumulated other comprehensive income, at beginning of period $ — $ 3,221 $ 1,806 $ 1,631 Other comprehensive income before reclassifications — 214 — 1,973 Amounts reclassified to accumulated other comprehensive income (1) — (397 ) (1,806 ) (566 ) Net current period other comprehensive income — (183 ) (1,806 ) 1,407 Accumulated other comprehensive income, at end of period $ — $ 3,038 $ — $ 3,038 (1) The amounts from AOCI were reclassified as a decrease to interest expense in our consolidated statements of operations. |
FAIR VALUE OF FINANCIAL INSTR_2
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value and Classification of Derivative Financial Instruments | The table below presents the fair value of our derivative financial instruments as well as their classification on our consolidated balance sheets: September 30, 2019 December 31, 2018 Level Balance Sheet (in thousands) Assets: Interest rate swaps $ — $ 1,630 2 Other assets |
Fair Values of Financial Instrument Not Recorded at Fair Value on a Recurring Basis | The estimated fair values of those financial instruments which are not recorded at fair value on a recurring basis on our consolidated balance sheets are as follows: September 30, 2019 December 31, 2018 Carrying Estimated Carrying Estimated Level (in thousands) Assets: SBA 7(a) loans receivable, subject to loan-backed notes $ 31,404 $ 32,658 $ 37,031 $ 38,357 3 SBA 7(a) loans receivable, subject to credit risk 26,257 27,310 29,748 30,630 3 SBA 7(a) loans receivable, subject to secured borrowings 13,915 14,015 16,469 16,706 3 Liabilities: Mortgages payable (1) 96,919 101,258 386,923 377,364 3 Junior subordinated notes 25,278 24,410 25,215 24,462 3 (1) The December 31, 2018 carrying amount and estimated fair value of mortgages payable exclude one mortgage loan with carrying value of $28,018,000 that had been classified as liabilities associated with assets held for sale, net, on our consolidated balance sheet at December 31, 2018 (Notes 3 and 7). |
RELATED-PARTY TRANSACTIONS (Tab
RELATED-PARTY TRANSACTIONS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Related Party Transactions [Abstract] | |
Asset Management Fees Calculation | The fee is calculated as a percentage of the daily average adjusted fair value of CIM Urban's assets: Daily Average Adjusted Fair Quarterly Fee From Greater of To and Including (in thousands) $ — $ 500,000 0.2500% 500,000 1,000,000 0.2375% 1,000,000 1,500,000 0.2250% 1,500,000 4,000,000 0.2125% 4,000,000 20,000,000 0.1000% |
FUTURE MINIMUM LEASE RENTALS (T
FUTURE MINIMUM LEASE RENTALS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Leases, Operating [Abstract] | |
Future Minimum Rental Revenue Under Long-Term Operating Leases | Future minimum rental revenue under long-term operating leases at September 30, 2019 , excluding tenant reimbursements of certain costs, are as follows: Years Ending December 31, Total (in thousands) 2019 (Three months ending December 31, 2019) $ 12,237 2020 46,706 2021 40,832 2022 37,465 2023 34,370 Thereafter 83,981 $ 255,591 |
CONCENTRATIONS (Tables)
CONCENTRATIONS (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Risks and Uncertainties [Abstract] | |
Concentration Risks From Properties | Our revenue concentrations from properties are as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 California 84.1 % 76.2 % 77.7 % 76.9 % Texas 7.4 3.5 5.1 3.3 Washington, D.C. 8.5 20.3 17.2 19.8 100.0 % 100.0 % 100.0 % 100.0 % Our real estate investments concentrations from properties are as follows: September 30, 2019 December 31, 2018 California (1) 94.8 % 70.6 % Texas 5.2 2.2 Washington, D.C. — 27.2 100.0 % 100.0 % (1) The December 31, 2018 percentage for California includes the assets of 260 Townsend Street, which was classified as held for sale on our consolidated balance sheet at December 31, 2018 and sold in March 2019 (Note 3). |
SEGMENT DISCLOSURE (Tables)
SEGMENT DISCLOSURE (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Segment Reporting [Abstract] | |
Segment Net Operating Income | The net operating income of our segments for the three and nine months ended September 30, 2019 and 2018 is as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands) Office: Revenues $ 16,885 $ 36,440 $ 72,380 $ 109,141 Property expenses: Operating 7,205 14,459 29,677 39,770 General and administrative 41 83 397 1,062 Total property expenses 7,246 14,542 30,074 40,832 Segment net operating income—office 9,639 21,898 42,306 68,309 Hotel: Revenues 8,511 8,542 29,430 29,980 Property expenses: Operating 6,081 5,946 19,520 19,316 General and administrative 31 — 108 18 Total property expenses 6,112 5,946 19,628 19,334 Segment net operating income—hotel 2,399 2,596 9,802 10,646 Lending: Revenues 2,411 2,625 8,312 8,324 Lending expenses: Interest expense 365 633 1,483 1,117 Fees to related party 652 740 1,840 1,980 General and administrative 505 414 1,343 1,273 Total lending expenses 1,522 1,787 4,666 4,370 Segment net operating income—lending 889 838 3,646 3,954 Total segment net operating income $ 12,927 $ 25,332 $ 55,754 $ 82,909 |
Reconciliation of Segment Net Operating Income to Net Income Attributable to the Company | A reconciliation of our segment net operating income to net income attributable to the Company for the three and nine months ended September 30, 2019 and 2018 is as follows: Three Months Ended September 30, Nine Months Ended 2019 2018 2019 2018 (in thousands) Total segment net operating income $ 12,927 $ 25,332 $ 55,754 $ 82,909 Interest and other income 1,408 — 3,226 — Asset management and other fees to related parties (3,329 ) (5,381 ) (12,315 ) (16,495 ) Interest expense (2,038 ) (6,332 ) (7,515 ) (19,292 ) General and administrative (807 ) (708 ) (2,945 ) (4,143 ) Transaction costs (340 ) (15 ) (600 ) (359 ) Depreciation and amortization (5,180 ) (13,310 ) (21,995 ) (39,783 ) Loss on early extinguishment of debt — — (29,982 ) — Impairment of real estate — — (69,000 ) — Gain on sale of real estate 302 — 433,104 — Income (loss) before provision for income taxes 2,943 (414 ) 347,732 2,837 Provision for income taxes (87 ) (115 ) (686 ) (795 ) Net income (loss) 2,856 (529 ) 347,046 2,042 Net (income) loss attributable to noncontrolling interests (8 ) 1 165 (15 ) Net income (loss) attributable to the Company $ 2,848 $ (528 ) $ 347,211 $ 2,027 |
Segment Condensed Assets | The condensed assets for each of the segments as of September 30, 2019 and December 31, 2018 , along with capital expenditures and loan originations for the nine months ended September 30, 2019 and 2018 , are as follows: September 30, 2019 December 31, 2018 (in thousands) Condensed assets: Office (1) $ 458,979 $ 1,094,269 Hotel 105,478 105,845 Lending 84,588 97,465 Non-segment assets 10,807 44,822 Total assets $ 659,852 $ 1,342,401 |
Segment Capital Expenditures | Nine Months Ended 2019 2018 (in thousands) Capital expenditures (2): Office (1) $ 9,500 $ 11,462 Hotel 1,846 1,343 Total capital expenditures 11,346 12,805 Loan originations 27,421 53,320 Total capital expenditures and loan originations $ 38,767 $ 66,125 (1) The December 31, 2018 balances include the assets of 260 Townsend Street, which was classified as held for sale on our consolidated balance sheet at December 31, 2018 and sold in March 2019 (Note 3). (2) Represents additions and improvements to real estate investments, excluding acquisitions. Includes the activity for dispositions through their respective disposition dates. |
PRO FORMA FINANCIAL INFORMATI_2
PRO FORMA FINANCIAL INFORMATION (Tables) | 9 Months Ended |
Sep. 30, 2019 | |
Accounting Changes and Error Corrections [Abstract] | |
Pro Forma Information | "Item 2 —Management's Discussion and Analysis of Financial Condition and Results of Operations— Program to Unlock Embedded Value in Our Portfolio and Improve Trading Liquidity of Our Common Stock." Three Months Ended September 30, Nine Months Ended September 30, 2019 2018 2019 2018 (in thousands, except per share amounts) Pro forma revenue $ 27,047 $ 41,193 $ 97,971 $ 128,074 Pro forma net income (loss) 1,513 (1,124 ) 412,341 102 Pro forma net income (loss) attributable to the Company 1,510 (1,131 ) 412,310 65 Pro forma net (loss) income attributable to common stockholders (2,960 ) (5,051 ) 399,368 (11,312 ) Pro forma net (loss) income attributable to common stockholders per share, basic $ (0.20 ) $ (0.35 ) $ 27.36 $ (0.77 ) Pro forma net (loss) income attributable to common stockholders per share, diluted $ (0.20 ) $ (0.35 ) $ 25.36 $ (0.77 ) |
ORGANIZATION AND OPERATIONS (De
ORGANIZATION AND OPERATIONS (Details) | Sep. 03, 2019$ / shares | Sep. 30, 2019$ / sharesshares | Dec. 31, 2018$ / sharesshares |
Class of Stock [Line Items] | |||
Common stock, par value (in usd per share) | $ / shares | $ 0.003 | $ 0.001 | $ 0.003 |
Common stock, shares authorized (in shares) | shares | 900,000,000 | 900,000,000 | |
Preferred stock, shares authorized (in shares) | shares | 100,000,000 | ||
Reverse stock split ratio, common stock | 0.3333 | ||
Series L Preferred Stock | |||
Class of Stock [Line Items] | |||
Preferred stock, par value (in usd per share) | $ / shares | $ 0.001 | $ 0.001 |
BASIS OF PRESENTATION AND SUM_4
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Investments in Real Estate (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Investments in Real Estate | ||||
Impairment of real estate | $ 0 | $ 0 | $ 69,000,000 | $ 0 |
Buildings and improvements | Minimum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 15 years | |||
Buildings and improvements | Maximum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 40 years | |||
Furniture, fixtures, and equipment | Minimum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 3 years | |||
Furniture, fixtures, and equipment | Maximum | ||||
Investments in Real Estate | ||||
Estimated useful lives | 5 years |
BASIS OF PRESENTATION AND SUM_5
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Revenue Recognition (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disaggregation of Revenue [Line Items] | ||||
Fixed lease payments | $ 15,389,000 | $ 34,108,000 | $ 66,925,000 | $ 101,423,000 |
Variable lease payments | 1,917,000 | 2,498,000 | 6,381,000 | 8,152,000 |
Rental and other property income | 17,306,000 | 36,606,000 | 73,306,000 | 109,575,000 |
Hotel income | 7,734,000 | 7,715,000 | 27,087,000 | 27,564,000 |
Tenant recoveries outside of lease agreements | 0 | 120,000 | 205,000 | 398,000 |
Remaining performance obligations | 0 | 0 | ||
Rental and other property income | ||||
Disaggregation of Revenue [Line Items] | ||||
Hotel income | 736,000 | 777,000 | 2,208,000 | 2,273,000 |
Interest and other income | ||||
Disaggregation of Revenue [Line Items] | ||||
Hotel income | 41,000 | 50,000 | 135,000 | 143,000 |
Hotel income | ||||
Disaggregation of Revenue [Line Items] | ||||
Hotel income | $ 8,511,000 | $ 8,542,000 | $ 29,430,000 | $ 29,980,000 |
BASIS OF PRESENTATION AND SUM_6
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Loans Receivable (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | Dec. 31, 2015 | Mar. 11, 2014 | |
Loans receivable | |||||||
Unamortized retained loan discounts | $ 7,673,000 | $ 7,673,000 | $ 7,234,000 | ||||
Loan receivable, nonaccrual, past due period (more than) | 60 days | ||||||
Impairment on loans receivable | 140,000 | $ 0 | $ 82,000 | $ 0 | |||
SBA 7(a) loans receivable, subject to secured borrowings | |||||||
Loans receivable | |||||||
Unamortized acquisition discounts related to sold loans | $ 15,951,000 | ||||||
PMC Commercial | |||||||
Loans receivable | |||||||
Discount on acquisition | $ 33,907,000 | ||||||
Acquisition discount | $ 774,000 | $ 774,000 | $ 884,000 |
BASIS OF PRESENTATION AND SUM_7
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Deferred Rent Receivable and Charges (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Deferred Rent Receivable and Charges | ||
Deferred rent receivable | $ 19,463 | $ 52,366 |
Deferred leasing costs | 16,771 | 51,152 |
Deferred leasing costs, accumulated amortization | 7,125 | 23,910 |
Deferred offering costs | 4,753 | 4,213 |
Other deferred costs | $ 454 | $ 409 |
BASIS OF PRESENTATION AND SUM_8
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Redeemable Preferred Stock (Details) | 9 Months Ended |
Sep. 30, 2019 | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | |
Preferred stock, percentage of stated value | 100.00% |
Preferred stock redemption, trading days prior to redemption | 20 days |
BASIS OF PRESENTATION AND SUM_9
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reclassifications (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Rental and other property expenses | $ (13,286) | $ (20,405) | $ (49,197) | $ (59,086) |
Rental and other property income | 17,306 | 36,606 | 73,306 | 109,575 |
Interest and other income | $ 4,175 | 3,286 | $ 12,955 | 10,306 |
Accounting Standards Update 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Expense reimbursements | 1,857 | 6,248 | ||
Non-lease component expense reimbursements | 272 | 841 | ||
Rental and other property expenses | 33 | 152 | ||
Interest and other income | 272 | 841 | ||
Reclassified From Expense Reimbursements | Accounting Standards Update 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Rental and other property income | 1,857 | 6,248 | ||
Reclassified From Rental And Other Property Expenses | Accounting Standards Update 2016-02 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Rental and other property income | $ 33 | $ 152 |
BASIS OF PRESENTATION AND SU_10
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recently Issued Accounting Pronouncements (Details) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019USD ($)contract | Jan. 01, 2019USD ($) | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Number of lease contracts | contract | 1 | |
Right-of use asset | $ 170 | |
Lease liability | $ 170 | |
Accounting Standards Update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Right-of use asset | $ 362 | |
Lease liability | $ 362 |
ACQUISITIONS AND DISPOSITIONS -
ACQUISITIONS AND DISPOSITIONS - Acquisitions (Details) $ in Thousands | Jan. 18, 2018USD ($)ft² | Sep. 30, 2019acquistion | Dec. 31, 2017USD ($) |
Business Acquisition [Line Items] | |||
Number of business acquisitions | acquistion | 0 | ||
9460 Wilshire Boulevard in Los Angeles, California | |||
Business Acquisition [Line Items] | |||
Percent of ownership acquired | 100.00% | ||
Square Feet | ft² | 91,750 | ||
Purchase Price | $ | $ 132,000 | ||
Non-refundable deposit | $ | $ 20,000 | ||
Asset acquisitions transaction costs | $ | $ 48 | ||
9460 Wilshire Boulevard in Los Angeles, California - Office Space | |||
Business Acquisition [Line Items] | |||
Square Feet | ft² | 68,866 | ||
9460 Wilshire Boulevard in Los Angeles, California - Retail Space | |||
Business Acquisition [Line Items] | |||
Square Feet | ft² | 22,884 |
ACQUISITIONS AND DISPOSITIONS_2
ACQUISITIONS AND DISPOSITIONS - Disposals (Details) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($)ft² | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)ft² | Sep. 30, 2018USD ($)disposition | |
Disposal Group | ||||
Ownership sold, percentage | 100.00% | |||
Disposed Property Information | ||||
Sales Price | $ 941,032,000 | $ 0 | ||
Gain on sale of real estate | $ 302,000 | $ 0 | 433,104,000 | 0 |
Impairment of real estate | 0 | $ 0 | 69,000,000 | $ 0 |
Extinguishment of noncontrolling interests as a result of the sale | $ 113,000 | 113,000 | ||
Number of dispositions during the period | disposition | 0 | |||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Disposed Property Information | ||||
Sales Price | 990,996,000 | |||
Transaction Costs | 18,350,000 | |||
Gain on sale of real estate | $ 433,104,000 | |||
March Oakland Properties, Oakland, CA | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Disposed Property Information | ||||
Square Feet | ft² | 975,596 | 975,596 | ||
Sales Price | $ 512,016,000 | |||
Transaction Costs | 8,971,000 | |||
Gain on sale of real estate | $ 289,779,000 | |||
830 1st Street, Washington, D.C. | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Disposed Property Information | ||||
Square Feet | ft² | 247,337 | 247,337 | ||
Sales Price | $ 116,550,000 | |||
Transaction Costs | 2,438,000 | |||
Gain on sale of real estate | $ 45,710,000 | |||
260 Townsend Street, San Francisco, CA | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Disposed Property Information | ||||
Square Feet | ft² | 66,682 | 66,682 | ||
Sales Price | $ 66,000,000 | |||
Transaction Costs | 2,539,000 | |||
Gain on sale of real estate | $ 42,092,000 | |||
1333 Broadway, Oakland, CA | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Disposed Property Information | ||||
Square Feet | ft² | 254,523 | 254,523 | ||
Sales Price | $ 115,430,000 | |||
Transaction Costs | 658,000 | |||
Gain on sale of real estate | $ 55,221,000 | |||
Union Square Properties,Washington, D.C. | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||
Disposed Property Information | ||||
Square Feet | ft² | 630,650 | 630,650 | ||
Sales Price | $ 181,000,000 | |||
Transaction Costs | 3,744,000 | |||
Gain on sale of real estate | $ 302,000 |
ACQUISITIONS AND DISPOSITIONS_3
ACQUISITIONS AND DISPOSITIONS - Fair Value of Net Assets Acquired (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Business Acquisition [Line Items] | |||
Percent of total assets, less than | 10.00% | ||
Acquired in-place leases | |||
Business Acquisition [Line Items] | |||
Average useful life (in years) | 8 years | 8 years | |
2018 Acquisitions | |||
Business Acquisition [Line Items] | |||
Net assets acquired | $ 132,048 | ||
2018 Acquisitions | Land | |||
Business Acquisition [Line Items] | |||
Property, plant, and equipment | 52,199 | ||
2018 Acquisitions | Land improvements | |||
Business Acquisition [Line Items] | |||
Property, plant, and equipment | 756 | ||
2018 Acquisitions | Buildings and improvements | |||
Business Acquisition [Line Items] | |||
Property, plant, and equipment | 74,522 | ||
2018 Acquisitions | Tenant improvements | |||
Business Acquisition [Line Items] | |||
Property, plant, and equipment | 1,451 | ||
2018 Acquisitions | Acquired in-place leases | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 7,003 | ||
Average useful life (in years) | 3 years | ||
2018 Acquisitions | Acquired above-market leases | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 109 | ||
Average useful life (in years) | 2 years | ||
2018 Acquisitions | Acquired below-market leases | |||
Business Acquisition [Line Items] | |||
Intangible assets | $ 3,992 | ||
Average useful life (in years) | 3 years |
ACQUISITIONS AND DISPOSITIONS_4
ACQUISITIONS AND DISPOSITIONS - Carrying Value of Assets and Liabilities at Time of Sale and Held for Sale (Details) - USD ($) $ in Thousands | Mar. 14, 2019 | Mar. 01, 2019 | Mar. 31, 2019 | Sep. 30, 2019 | Sep. 30, 2018 | May 16, 2019 | Dec. 31, 2018 |
Disposal Group | |||||||
Ownership sold, percentage | 100.00% | ||||||
Assets | |||||||
Total assets, net | $ 0 | $ 22,175 | |||||
Liabilities | |||||||
Total liabilities | 0 | 28,766 | |||||
Deferred loan costs | 1,704 | ||||||
Debt, accumulated amortization | 576 | ||||||
Payment of mortgages payable | 46,000 | $ 0 | |||||
Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||
Assets | |||||||
Investments in real estate, net | 476,532 | ||||||
Deferred rent receivable and charges, net | 55,297 | ||||||
Other intangible assets, net | 316 | ||||||
Other assets | 4,096 | ||||||
Total assets, net | 536,241 | ||||||
Liabilities | |||||||
Debt, net | 318,072 | ||||||
Total liabilities | $ 318,072 | ||||||
Disposal Group, Held-for-sale, Not Discontinued Operations | |||||||
Assets | |||||||
Investments in real estate, net | 17,123 | ||||||
Cash and cash equivalents | 755 | ||||||
Accounts receivable, net | 41 | ||||||
Deferred rent receivable and charges, net | 4,009 | ||||||
Other intangible assets, net | 220 | ||||||
Other assets | 27 | ||||||
Total assets, net | 22,175 | ||||||
Liabilities | |||||||
Debt, net | 28,018 | ||||||
Accounts payable and accrued expenses | 370 | ||||||
Due to related parties | 81 | ||||||
Other liabilities | 297 | ||||||
Total liabilities | 28,766 | ||||||
Deferred loan costs | 243 | ||||||
Debt, accumulated amortization | 61 | ||||||
Investments in real estate | 24,832 | ||||||
Investments in real estate, accumulated depreciation | 7,709 | ||||||
Deferred rent receivable | 2,909 | ||||||
Deferred leasing costs | 1,669 | ||||||
Deferred leasing costs, accumulated amortization | 569 | ||||||
Debt, gross | 28,200 | ||||||
Acquired In-Place Leases | Disposal Group, Held-for-sale, Not Discontinued Operations | |||||||
Assets | |||||||
Other intangible assets, net | 1,778 | ||||||
Liabilities | |||||||
Other intangible assets, accumulated amortization | $ 1,558 | ||||||
Office Property, San Fransisco California | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||
Liabilities | |||||||
Outstanding amount | $ 28,200 | ||||||
Office Property, Washington, D.C. | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||
Liabilities | |||||||
Payment of mortgages payable | $ 46,000 | ||||||
260 Townsend Street, San Francisco, CA | |||||||
Disposal Group | |||||||
Ownership sold, percentage | 100.00% | ||||||
Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | Properties Used As Collateral For Loans | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||
Liabilities | |||||||
Defeased amount | $ 205,500 | ||||||
Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | 1333 Broadway, Oakland, CA | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||
Liabilities | |||||||
Defeased amount | $ 39,500 |
INVESTMENTS IN REAL ESTATE (Det
INVESTMENTS IN REAL ESTATE (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Real Estate [Abstract] | |||||
Land | $ 134,421 | $ 134,421 | $ 266,410 | ||
Land improvements | 2,713 | 2,713 | 18,368 | ||
Buildings and improvements | 437,833 | 437,833 | 912,892 | ||
Furniture, fixtures, and equipment | 3,724 | 3,724 | 4,245 | ||
Tenant improvements | 32,807 | 32,807 | 133,487 | ||
Work in progress | 12,152 | 12,152 | 9,234 | ||
Investments in real estate | 623,650 | 623,650 | 1,344,636 | ||
Accumulated depreciation | (117,684) | (117,684) | (303,699) | ||
Net investments in real estate | 505,966 | 505,966 | $ 1,040,937 | ||
Depreciation expense | $ 4,156 | $ 10,901 | $ 17,908 | $ 32,487 |
LOANS RECEIVABLE (Details)
LOANS RECEIVABLE (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
Loans receivable | ||
Loans receivable | $ 71,111 | $ 82,641 |
Deferred capitalized costs | 1,147 | 1,309 |
Loan loss reserves | (682) | (702) |
Loans receivable, net | $ 71,576 | $ 83,248 |
Loans, percent current | 99.90% | 99.70% |
SBA 7(a) loans receivable, subject to loan-backed notes | ||
Loans receivable | ||
Loans receivable | $ 31,565 | $ 36,847 |
SBA 7(a) loans receivable, subject to credit risk | ||
Loans receivable | ||
Loans receivable | 25,670 | 29,385 |
SBA 7(a) loans receivable, subject to secured borrowings | ||
Loans receivable | ||
Loans receivable | 13,876 | 16,409 |
Substandard | ||
Loans receivable | ||
Loans receivable, net | $ 866 | $ 235 |
Hospitality Industry | Loans subject to credit risk | ||
Loans receivable | ||
Concentration risk, percent | 98.80% | 98.30% |
OTHER INTANGIBLE ASSETS (Detail
OTHER INTANGIBLE ASSETS (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Intangible liabilities | |||||
Net | $ (1,562) | $ (1,562) | $ (2,872) | ||
Future accretion of acquisition related intangible liabilities | |||||
Net | (1,562) | (1,562) | (2,872) | ||
Acquired Below-Market Leases | |||||
Intangible liabilities | |||||
Gross balance | (3,521) | (3,521) | (6,618) | ||
Accumulated amortization | 1,959 | 1,959 | 3,746 | ||
Net | (1,562) | $ (1,562) | $ (2,872) | ||
Average useful life (in years) | 4 years | 4 years | |||
Future accretion of acquisition related intangible liabilities | |||||
2019 (Three months ending December 31, 2019) | (280) | $ (280) | |||
2020 | (701) | (701) | |||
2021 | (347) | (347) | |||
2022 | (234) | (234) | |||
2023 | 0 | 0 | |||
Thereafter | 0 | 0 | |||
Net | (1,562) | (1,562) | $ (2,872) | ||
Acquired Above-Market Leases | |||||
Intangible assets | |||||
Gross balance | 74 | 74 | 146 | ||
Accumulated amortization | (38) | (38) | (51) | ||
Net | 36 | $ 36 | $ 95 | ||
Average useful life (in years) | 5 years | 3 years | |||
Amortization | |||||
Amortization expense | 17 | $ 14 | $ 59 | $ 40 | |
Future amortization of acquisition related intangible assets | |||||
2019 (Three months ending December 31, 2019) | 4 | 4 | |||
2020 | 9 | 9 | |||
2021 | 5 | 5 | |||
2022 | 5 | 5 | |||
2023 | 6 | 6 | |||
Thereafter | 7 | 7 | |||
Net | 36 | 36 | $ 95 | ||
Acquired In-Place Leases | |||||
Intangible assets | |||||
Gross balance | 13,653 | 13,653 | 16,210 | ||
Accumulated amortization | (8,906) | (8,906) | (9,731) | ||
Net | 4,747 | $ 4,747 | $ 6,479 | ||
Average useful life (in years) | 8 years | 8 years | |||
Amortization | |||||
Amortization expense | 495 | 927 | $ 1,636 | 2,769 | |
Future amortization of acquisition related intangible assets | |||||
2019 (Three months ending December 31, 2019) | 476 | 476 | |||
2020 | 1,349 | 1,349 | |||
2021 | 899 | 899 | |||
2022 | 663 | 663 | |||
2023 | 375 | 375 | |||
Thereafter | 985 | 985 | |||
Net | 4,747 | 4,747 | $ 6,479 | ||
Trade Name and License | |||||
Intangible assets | |||||
Gross balance | 2,957 | 2,957 | 2,957 | ||
Accumulated amortization | 0 | 0 | 0 | ||
Net | 2,957 | 2,957 | 2,957 | ||
Future amortization of acquisition related intangible assets | |||||
Net | 2,957 | 2,957 | $ 2,957 | ||
Rental and Other Property Income | Acquired Below-Market Leases | |||||
Amortization | |||||
Amortization expense | $ 376 | $ 478 | $ 1,310 | $ 1,711 |
DEBT - Schedule (Details)
DEBT - Schedule (Details) - USD ($) | May 30, 2018 | Sep. 30, 2019 | May 16, 2019 | Mar. 01, 2019 | Dec. 31, 2018 |
Debt | |||||
Total Debt | $ 227,727,000 | $ 588,671,000 | |||
Mortgages Payable | |||||
Debt | |||||
Gross debt | 97,100,000 | 388,100,000 | |||
Deferred loan costs | (181,000) | (1,177,000) | |||
Total Debt | 96,919,000 | 386,923,000 | |||
Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | |||||
Debt | |||||
Gross debt | $ 97,100,000 | 342,100,000 | |||
Fixed interest rate | 4.14% | ||||
Amount of balance due on maturity | $ 97,100,000 | ||||
Mortgage loan with a fixed interest of 4.50% per annum, due on January 5, 2027 | |||||
Debt | |||||
Gross debt | $ 0 | 46,000,000 | |||
Fixed interest rate | 4.50% | ||||
Amount of balance due on maturity | $ 42,008,000 | ||||
Period of amortization schedule | 10 years | ||||
Secured Borrowings - Government Guaranteed Loans | |||||
Debt | |||||
Gross debt | $ 13,288,000 | 15,765,000 | |||
Premiums and discounts | 727,000 | 940,000 | |||
Total Debt | 14,015,000 | 16,705,000 | |||
Secured borrowing principal on SBA 7(a) loans sold for a premium and excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 6.21% and 5.89% at September 30, 2019 and December 31, 2018, respectively. | |||||
Debt | |||||
Gross debt | $ 8,935,000 | $ 11,283,000 | |||
Weighted average rate | 6.21% | 5.89% | |||
Secured borrowing principal on SBA 7(a) loans sold for excess spread—variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 3.82% and 3.57% at September 30, 2019 and December 31, 2018, respectively. | |||||
Debt | |||||
Gross debt | $ 4,353,000 | $ 4,482,000 | |||
Weighted average rate | 3.82% | 3.57% | |||
Loan Backed Notes | LIBOR | |||||
Debt | |||||
Interest rate margin | 1.40% | 1.40% | |||
Loan Backed Notes | Prime Rate | |||||
Debt | |||||
Interest rate margin | 1.08% | 1.08% | |||
Other Debt | |||||
Debt | |||||
Gross debt | $ 121,714,000 | $ 190,839,000 | |||
Total Debt | 116,793,000 | 185,043,000 | |||
Loan-Backed Notes | |||||
Debt | |||||
Gross debt | 26,144,000 | 33,769,000 | |||
Junior subordinated notes | |||||
Debt | |||||
Gross debt | 27,070,000 | 27,070,000 | |||
Premiums and discounts | $ (1,792,000) | (1,855,000) | |||
Junior subordinated notes | LIBOR | |||||
Debt | |||||
Interest rate margin | 3.25% | ||||
Unsecured term loan and credit facilities | |||||
Debt | |||||
Deferred loan costs | $ (3,129,000) | (3,941,000) | |||
Revolving Credit Facility | Line of Credit | |||||
Debt | |||||
Gross debt | $ 68,500,000 | $ 130,000,000 | |||
1333 Broadway, Oakland, CA | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | |||||
Debt | |||||
Defeased amount | $ 39,500,000 | ||||
Properties Used As Collateral For Loans | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | |||||
Debt | |||||
Defeased amount | $ 205,500,000 |
DEBT - Narrative (Details)
DEBT - Narrative (Details) | Oct. 18, 2019USD ($) | May 16, 2019USD ($)mortgage_loan | Mar. 14, 2019USD ($)mortgage_loan | Mar. 11, 2019USD ($)swap | Mar. 01, 2019USD ($) | Feb. 28, 2019USD ($) | Dec. 28, 2018USD ($)swap | Oct. 30, 2018USD ($) | May 30, 2018USD ($) | Sep. 21, 2017USD ($)mortgage_loan | Oct. 31, 2018USD ($)extension | Jun. 30, 2016USD ($)agreement | May 31, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2017USD ($)swap | Dec. 31, 2018USD ($) | Nov. 02, 2015USD ($) | Aug. 13, 2015USD ($) |
Debt | ||||||||||||||||||||||
Deferred loan costs | $ 4,535,000 | $ 4,535,000 | $ 5,994,000 | |||||||||||||||||||
Deferred loan costs, accumulated amortization | 1,225,000 | 1,225,000 | 876,000 | |||||||||||||||||||
Loss on early extinguishment of debt | 0 | $ 0 | 29,982,000 | $ 0 | ||||||||||||||||||
Proceeds from notes payable | 0 | 38,200,000 | ||||||||||||||||||||
Restricted cash | 11,507,000 | $ 21,524,000 | 11,507,000 | 21,524,000 | 22,512,000 | |||||||||||||||||
Number of swaps terminated | swap | 2 | 1 | 7 | |||||||||||||||||||
Notional amount of terminated swaps | $ 120,000,000 | $ 50,000,000 | ||||||||||||||||||||
Financing Receivable, Revolving | 74,000,000 | 0 | ||||||||||||||||||||
Payment of mortgages payable | 46,000,000 | 0 | ||||||||||||||||||||
Prepayment penalties and other payments for early extinguishment of debt | 5,660,000 | $ 0 | ||||||||||||||||||||
Accrued interest and unused commitment fee payable | 552,000 | 552,000 | 1,574,000 | |||||||||||||||||||
Unsecured credit facility entered into in September 2014 | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Maximum borrowing capacity | $ 850,000,000 | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, revolver | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Maximum borrowing capacity | $ 450,000,000 | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, revolver | Minimum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 0.20% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, revolver | Maximum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.00% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, revolver | LIBOR | Minimum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.20% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, revolver | LIBOR | Maximum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 2.00% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, term loan | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Maximum borrowing capacity | $ 325,000,000 | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, term loan | LIBOR | Minimum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.15% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, term loan | LIBOR | Maximum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.95% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, term loan | Base rate | Minimum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 0.15% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, term loan | Base rate | Maximum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 0.95% | |||||||||||||||||||||
Unsecured credit facility entered into in September 2014, delayed-draw term loan | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Maximum borrowing capacity | $ 75,000,000 | |||||||||||||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Deferred loan costs, accumulated amortization | $ 705,000 | |||||||||||||||||||||
Maximum borrowing capacity | $ 385,000,000 | $ 385,000,000 | ||||||||||||||||||||
Interest rate | 3.16% | |||||||||||||||||||||
Repayments of debt | 215,000,000 | |||||||||||||||||||||
Write off of deferred loan costs | $ 1,872,000 | $ 1,988,000 | ||||||||||||||||||||
Repayments of long-term debt | 170,000,000 | |||||||||||||||||||||
Write off of accumulated amortization | 1,064,000 | |||||||||||||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | LIBOR | Minimum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.60% | |||||||||||||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | LIBOR | Maximum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 2.25% | |||||||||||||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | Base rate | Minimum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 0.60% | |||||||||||||||||||||
Unsecured Term Loan Facility Entered Into May 2015 | Base rate | Maximum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.25% | |||||||||||||||||||||
Mortgages Payable | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Number of mortgage loan agreements | agreement | 6 | |||||||||||||||||||||
Amount of loan | $ 392,000,000 | |||||||||||||||||||||
Gross debt | 97,100,000 | 97,100,000 | 388,100,000 | |||||||||||||||||||
Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Gross debt | 97,100,000 | 97,100,000 | 342,100,000 | |||||||||||||||||||
Loan Backed Notes | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Proceeds from notes payable | $ 38,200,000 | |||||||||||||||||||||
Weight average life | 2 years | |||||||||||||||||||||
Restricted cash | 2,232,000 | $ 2,232,000 | $ 3,174,000 | |||||||||||||||||||
Loan Backed Notes | LIBOR | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.40% | 1.40% | ||||||||||||||||||||
Loan Backed Notes | Prime Rate | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.08% | 1.08% | ||||||||||||||||||||
Revolving Credit Facility | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Maximum borrowing capacity | $ 250,000,000 | |||||||||||||||||||||
Interest rate | 4.07% | |||||||||||||||||||||
Number of extensions | extension | 1 | |||||||||||||||||||||
Extension option, term | 1 year | |||||||||||||||||||||
Proceeds from issuance of debt | $ 170,000,000 | |||||||||||||||||||||
Revolving Credit Facility | Minimum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Unused commitment fee percentage | 0.15% | |||||||||||||||||||||
Revolving Credit Facility | Maximum | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Unused commitment fee percentage | 0.25% | |||||||||||||||||||||
Revolving Credit Facility | LIBOR | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 1.55% | |||||||||||||||||||||
Revolving Credit Facility | Base rate | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Interest rate margin | 0.55% | |||||||||||||||||||||
7083 Hollywood Boulevard, Los Angeles, California | Disposal Group, Held-for-sale, Not Discontinued Operations | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Outstanding amount | $ 21,700,000 | |||||||||||||||||||||
Number of mortgage loans assumed by buyer | mortgage_loan | 1 | |||||||||||||||||||||
Properties Used As Collateral For Loans | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Write off of deferred loan costs | $ 637,000 | |||||||||||||||||||||
Write off of accumulated amortization | 170,000 | |||||||||||||||||||||
Defeased amount | 205,500,000 | |||||||||||||||||||||
Cash outlay required for defeasance | 224,086,000 | |||||||||||||||||||||
Loss on early extinguishment of debt | 0 | $ 19,290,000 | ||||||||||||||||||||
Transaction costs | 237,000 | |||||||||||||||||||||
Office Property, San Fransisco California | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Write off of deferred loan costs | 243,000 | |||||||||||||||||||||
Write off of accumulated amortization | 65,000 | |||||||||||||||||||||
Outstanding amount | $ 28,200,000 | |||||||||||||||||||||
Loss on early extinguishment of debt | 0 | 178,000 | ||||||||||||||||||||
Number of mortgage loans assumed by buyer | mortgage_loan | 1 | |||||||||||||||||||||
1333 Broadway, Oakland, CA | Disposal Group, Disposed of by Sale, Not Discontinued Operations | Mortgage loan with a fixed interest of 4.14% per annum, due on July 1, 2026 | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Write off of deferred loan costs | $ 287,000 | |||||||||||||||||||||
Write off of accumulated amortization | 82,000 | |||||||||||||||||||||
Defeased amount | 39,500,000 | |||||||||||||||||||||
Cash outlay required for defeasance | 44,108,000 | |||||||||||||||||||||
Loss on early extinguishment of debt | 0 | 4,911,000 | ||||||||||||||||||||
Transaction costs | $ 98,000 | |||||||||||||||||||||
Number of mortgage loans defeased | mortgage_loan | 1 | |||||||||||||||||||||
Office Property, Washington, D.C. | Disposal Group, Disposed of by Sale, Not Discontinued Operations | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Write off of deferred loan costs | 537,000 | |||||||||||||||||||||
Write off of accumulated amortization | 259,000 | |||||||||||||||||||||
Loss on early extinguishment of debt | 0 | 5,603,000 | ||||||||||||||||||||
Payment of mortgages payable | 46,000,000 | |||||||||||||||||||||
Prepayment penalties and other payments for early extinguishment of debt | $ 5,325,000 | |||||||||||||||||||||
Interest Rate Swap | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Total notional amount | $ 385,000,000 | |||||||||||||||||||||
Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedges | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Total notional amount | $ 120,000,000 | $ 120,000,000 | ||||||||||||||||||||
Interest Rate Swap | Designated as Hedging Instrument | Cash Flow Hedges | Weighted Average | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
All-in rate | 3.11% | 3.11% | ||||||||||||||||||||
Revolving Credit Facility | Line of Credit | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Repayments of debt | $ 120,000,000 | $ 10,000,000 | $ 40,000,000 | |||||||||||||||||||
Gross debt | $ 68,500,000 | $ 68,500,000 | $ 130,000,000 | |||||||||||||||||||
Remaining borrowing capacity | $ 175,100,000 | $ 175,100,000 | $ 91,000,000 | |||||||||||||||||||
Revolving Credit Facility | Subsequent Event | Line of Credit | ||||||||||||||||||||||
Debt | ||||||||||||||||||||||
Financing Receivable, Revolving | $ 76,500,000 |
DEBT - Schedule of Future Princ
DEBT - Schedule of Future Principal Payments (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Future Principal Payments on Debt | |
2019 (Three months ending December 31, 2019) | $ 1,479 |
2020 | 2,373 |
2021 | 2,450 |
2022 | 71,031 |
2023 | 2,620 |
Thereafter | 152,149 |
Total Debt | 232,102 |
Mortgages Payable | |
Future Principal Payments on Debt | |
2019 (Three months ending December 31, 2019) | 0 |
2020 | 0 |
2021 | 0 |
2022 | 0 |
2023 | 0 |
Thereafter | 97,100 |
Total Debt | 97,100 |
Secured Borrowings Principal | |
Future Principal Payments on Debt | |
2019 (Three months ending December 31, 2019) | 128 |
2020 | 529 |
2021 | 557 |
2022 | 588 |
2023 | 620 |
Thereafter | 10,866 |
Total Debt | 13,288 |
Other Debt | |
Future Principal Payments on Debt | |
2019 (Three months ending December 31, 2019) | 1,351 |
2020 | 1,844 |
2021 | 1,893 |
2022 | 70,443 |
2023 | 2,000 |
Thereafter | 44,183 |
Total Debt | $ 121,714 |
STOCK-BASED COMPENSATION PLANS
STOCK-BASED COMPENSATION PLANS (Details) - Restricted share awards - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||||
Jul. 31, 2019 | May 31, 2019 | May 31, 2018 | Jun. 30, 2017 | Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Share-based compensation plans | ||||||||
Unrecognized compensation expense | $ 131 | $ 131 | ||||||
Independent Directors | ||||||||
Share-based compensation plans | ||||||||
Granted to each individual (in shares) | 81 | 889 | 1,126 | 1,065 | ||||
Granted (in shares) | 324 | 3,556 | 3,378 | 3,195 | ||||
Award vesting period | 1 year | 1 year | 1 year | |||||
Stock-based compensation expense | $ 56 | $ 38 | $ 138 | $ 124 |
EARNINGS PER SHARE (''EPS'') (D
EARNINGS PER SHARE (''EPS'') (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2019 | Sep. 30, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | ||
Numerator: | |||||
Net (loss) income attributable to common stockholders | $ (1,622) | $ (4,448) | $ 334,269 | $ (9,350) | |
Redeemable preferred stock dividends declared on dilutive shares | 0 | 0 | 1,917 | 0 | |
Diluted net (loss) income attributable to common stockholders | $ (1,622) | $ (4,448) | $ 336,186 | $ (9,350) | |
Denominator: | |||||
Basic weighted average shares outstanding (in shares) | [1] | 14,598 | 14,598 | 14,598 | 14,597 |
Effect of dilutive securities—contingently issuable shares and stock options (in shares) | 1 | 0 | 1,227 | 0 | |
Diluted weighted average shares and common stock equivalents outstanding (in shares) | [1] | 14,599 | 14,598 | 15,825 | 14,597 |
Net (loss) income attributable to common stockholders per share: | |||||
Basic (in usd per share) | [1] | $ (0.11) | $ (0.30) | $ 22.90 | $ (0.64) |
Diluted (in usd per share) | [1] | $ (0.11) | $ (0.30) | $ 21.24 | $ (0.64) |
[1] | All share and per share amounts have been adjusted to give retroactive effect to the one-for-three reverse stock split of our common stock effected on September 3, 2019. |
REDEEMABLE PREFERRED STOCK - Na
REDEEMABLE PREFERRED STOCK - Narrative (Details) - USD ($) | Oct. 22, 2019 | Nov. 21, 2017 | Jul. 01, 2016 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Dec. 31, 2018 |
Class of Stock [Line Items] | |||||||||||
Preferred stock redemption, trading days prior to redemption | 20 days | ||||||||||
Costs specifically identifiable to the offering | $ 8,102,000 | ||||||||||
Non issuance specific costs | 5,360,000 | ||||||||||
Deferred rent receivable and charges reclassified to temporary equity | $ 56,033,000 | ||||||||||
Dividends accrued ( in usd per share) | $ 0.34375 | $ 0.34375 | $ 0.34375 | $ 0.34375 | $ 0.34375 | $ 0.34375 | |||||
Series A Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Preferred stock redemption, trading days prior to redemption | 20 days | ||||||||||
Proceeds from issuance of preferred stock | $ 101,987,000 | ||||||||||
Costs specifically identifiable to the offering | 7,969,000 | ||||||||||
Reclassification of Series A Preferred Stock from temporary equity to permanent equity | $ 603,000 | ||||||||||
Number of shares redeemed | 12,887 | ||||||||||
Cumulative dividend rate | 5.50% | ||||||||||
Dividend per share per year (in usd per share) | $ 0.34375 | ||||||||||
Preferred stock, shares issued (in shares) | 1,642,763 | 1,642,763 | 1,566,386 | ||||||||
Preferred stock, liquidation preference per share (in usd per share) | $ 25 | $ 25 | $ 25 | ||||||||
Series A Preferred Unit | |||||||||||
Class of Stock [Line Items] | |||||||||||
Units issued (in shares) | 4,104,867 | 4,104,867 | |||||||||
Proceeds from issuance of preferred stock and warrants | $ 102,620,000 | ||||||||||
Warrant | |||||||||||
Class of Stock [Line Items] | |||||||||||
Net proceeds from issuance of warrants | 633,000 | ||||||||||
Costs specifically identifiable to the offering | 133,000 | ||||||||||
Reclassification of Series A Preferred Stock from temporary equity to permanent equity | $ 4,000 | ||||||||||
Series L Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Proceeds from issuance of preferred stock and warrants | $ 229,251,000 | ||||||||||
Costs specifically identifiable to the offering | 15,928,000 | ||||||||||
Non issuance specific costs | $ 2,532,000 | ||||||||||
Number of shares redeemed | 0 | ||||||||||
Cumulative dividend rate | 5.50% | ||||||||||
Dividend per share per year (in usd per share) | $ 1.56035 | ||||||||||
Preferred stock, shares issued (in shares) | 8,080,740 | 8,080,740 | 8,080,740 | 8,080,740 | |||||||
Preferred stock, liquidation preference per share (in usd per share) | $ 28.37 | $ 28.37 | $ 28.37 | ||||||||
Preferred stock discount | $ 2,946,000 | ||||||||||
Failure to declare or pay distributions, temporary increase per year | 1.00% | ||||||||||
Failure to declare or pay distributions, temporary increase per year, maximum increase | 8.50% | ||||||||||
Minimum fixed charge coverage ratio | 125.00% | ||||||||||
Registration Statement | |||||||||||
Class of Stock [Line Items] | |||||||||||
Maximum amount of offering | $ 900,000,000 | $ 900,000,000 | |||||||||
Warrant right to purchase a share of common stock (in shares) | 0.25 | 0.25 | |||||||||
Maximum number of units in offering (in shares) | 36,000,000 | 36,000,000 | |||||||||
Registration Statement | Series A Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Redeemable preferred stock, par value (in usd per share) | $ 0.001 | $ 0.001 | |||||||||
Preferred stock, stated value (in usd per share) | $ 25 | $ 25 | |||||||||
Registration Statement | Series L Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Preferred stock, liquidation preference per share (in usd per share) | $ 28.37 | ||||||||||
Preferred Stock, Redemption Period, Year Two | Series A Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Preferred stock, redemption fee | 13.00% | ||||||||||
Preferred Stock, Redemption Period, After Year Two, Before Year Five | Series A Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Preferred stock, redemption fee | 10.00% | ||||||||||
Preferred Stock, Redemption Period, After Year Five | Series A Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Preferred stock, redemption fee | 0.00% | ||||||||||
Tender Offer | Subsequent Event | Series L Preferred Stock | |||||||||||
Class of Stock [Line Items] | |||||||||||
Authorized shares for repurchase (in shares) | 2,693,580 | ||||||||||
Authorized shares for repurchase, percentage of share outstanding | 33.00% | ||||||||||
Purchase price (in usd per share) | $ 29.12 | ||||||||||
Dividends accrued ( in usd per share) | $ 1.39 | ||||||||||
Escrow deposit | $ 78,545,000 |
REDEEMABLE PREFERRED STOCK - Di
REDEEMABLE PREFERRED STOCK - Dividends Declared (Details) - USD ($) $ in Thousands | Aug. 08, 2019 | Jun. 04, 2019 | Feb. 20, 2019 | Aug. 22, 2018 | Jun. 04, 2018 | Mar. 06, 2018 | Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 |
Class of Stock [Line Items] | ||||||||||||
Cash Dividends Declared | $ 1,318 | $ 1,150 | $ 1,010 | $ 769 | $ 662 | $ 493 | ||||||
Series A Preferred Stock | ||||||||||||
Class of Stock [Line Items] | ||||||||||||
Number of Shares | 4,091,980 | 3,601,721 | 3,149,924 | 2,457,119 | 2,149,863 | 1,674,841 | ||||||
Cash Dividends Declared | $ 1,318 | $ 1,150 | $ 1,010 | $ 769 | $ 662 | $ 493 |
REDEEMABLE PREFERRED STOCK - _2
REDEEMABLE PREFERRED STOCK - Dividends Accumulated (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Class of Stock [Line Items] | ||||||||
Dividends Accumulated | $ 4,470 | $ 3,921 | $ 12,934 | $ 11,380 | ||||
Series L Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Series L Preferred Stock outstanding (in shares) | 8,080,740 | 8,080,740 | 8,080,740 | 8,080,740 | 8,080,740 | 8,080,740 | 8,080,740 | |
Dividends Accumulated | $ 3,152 | $ 3,152 | $ 3,152 | $ 3,152 | $ 3,152 | $ 3,152 |
STOCKHOLDERS' EQUITY - Dividend
STOCKHOLDERS' EQUITY - Dividends (Details) $ / shares in Units, $ in Thousands | Aug. 30, 2019USD ($)$ / shares | Aug. 08, 2019$ / shares | Jun. 04, 2019$ / shares | Feb. 20, 2019$ / shares | Aug. 22, 2018$ / shares | Jun. 04, 2018$ / shares | Mar. 06, 2018$ / shares | Jan. 11, 2018USD ($) | Dec. 18, 2017$ / shares | Sep. 30, 2019$ / shares | Jun. 30, 2019$ / shares | Mar. 31, 2019$ / shares | Sep. 30, 2018$ / shares | Jun. 30, 2018$ / shares | Mar. 31, 2018$ / shares | Sep. 30, 2019USD ($)property | Sep. 30, 2018USD ($) |
Dividends Payable [Line Items] | |||||||||||||||||
Dividends paid per common share (in usd per share) | $ 0.075 | $ 0.375 | $ 0.375 | $ 0.375 | $ 0.375 | $ 0.375 | |||||||||||
Declared dividends per common share prior to reverse stock split (in usd per share) | $ 0.73 | ||||||||||||||||
Payments of special dividends | $ | $ 613,294 | $ 1,575 | |||||||||||||||
Common Stock | |||||||||||||||||
Dividends Payable [Line Items] | |||||||||||||||||
Declared dividends per common share (in usd per share) | $ 0.075 | $ 0.375 | $ 0.375 | $ 0.375 | $ 0.375 | $ 0.375 | |||||||||||
Common Stock, Excluding Private Repurchase Participants | |||||||||||||||||
Dividends Payable [Line Items] | |||||||||||||||||
Declared dividends per common share (in usd per share) | $ 2.19 | ||||||||||||||||
Payments of special dividends | $ | $ 1,575 | ||||||||||||||||
Special Dividend | |||||||||||||||||
Dividends Payable [Line Items] | |||||||||||||||||
Dividends paid per common share (in usd per share) | $ 42 | ||||||||||||||||
Special Dividend | Common Stock | |||||||||||||||||
Dividends Payable [Line Items] | |||||||||||||||||
Declared dividends per common share (in usd per share) | $ 14 | $ 42 | |||||||||||||||
Dividends paid per common share (in usd per share) | $ 42 | ||||||||||||||||
Payments of special dividends | $ | $ 613,294 | ||||||||||||||||
Ten Real Estate Properties Sold In 2019 | Disposal Group, Disposed of by Sale, Not Discontinued Operations | |||||||||||||||||
Dividends Payable [Line Items] | |||||||||||||||||
Number of real estate properties sold | property | 10 |
STOCKHOLDERS' EQUITY - Share Re
STOCKHOLDERS' EQUITY - Share Repurchases (Details) - USD ($) $ / shares in Units, $ in Thousands | Dec. 18, 2017 | Sep. 30, 2019 |
Equity, Class of Treasury Stock [Line Items] | ||
Stock repurchased and retired | $ 1 | |
Urban Partners II, LLC | December 2017 Share Repurchase | Common Stock | ||
Equity, Class of Treasury Stock [Line Items] | ||
Stock repurchased and retired (in shares) | 4,696,969 | |
Stock repurchased and retired | $ 310,000 | |
Stock repurchased and retired (in usd per share) | $ 66 |
STOCKHOLDERS' EQUITY - Warrants
STOCKHOLDERS' EQUITY - Warrants (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2019 | Sep. 30, 2018 | |
Registration statement | ||
Warrants issued (in shares) | 4,104,867 | |
Net proceeds from issuance of warrants | $ 295 | $ 62 |
Registration Statement | ||
Registration statement | ||
Warrant right to purchase a share of common stock (in shares) | 0.25 | |
Premium of the exercise price of the warrant as a percent to net asset value of common stock | 15.00% | |
Series A Preferred Unit | ||
Registration statement | ||
Net proceeds from issuance of warrants | $ 496 |
DERIVATIVE FINANCIAL INSTRUME_3
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) | Mar. 11, 2019USD ($)swap | Feb. 28, 2019USD ($) | Dec. 28, 2018USD ($)swap | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Dec. 31, 2017USD ($)swap | Aug. 13, 2015USD ($)swap |
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||||||||
Number of swaps terminated | swap | 2 | 1 | 7 | ||||||
Termination payments, net of fees | $ 1,302,000 | $ 684,000 | $ 973,000 | ||||||
Notional amount of terminated swaps | 120,000,000 | 50,000,000 | |||||||
Reclassification from AOCI to interest expense | $ 0 | $ 320,000 | $ 1,806,000 | $ 320,000 | |||||
Write-off from swaps being terminated | 1,580,000 | ||||||||
Change in fair value of swaps | 209,000 | 70,000 | |||||||
Unsecured Term Loan Facility Entered Into May 2015 | |||||||||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||||||||
Repayments of debt | $ 215,000,000 | ||||||||
Interest Rate Swap | |||||||||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||||||||
Number of interest rate swaps | swap | 10 | ||||||||
Total notional amount | $ 385,000,000 | ||||||||
Derivative, fair value | 1,421,000 | ||||||||
Loss on swap | 0 | 119,000 | |||||||
Revolving Credit Facility | Line of Credit | |||||||||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||||||||
Repayments of debt | $ 120,000,000 | $ 10,000,000 | $ 40,000,000 | ||||||
Interest Expense | |||||||||
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES | |||||||||
Change in fair value of swaps | $ 0 | $ 70,000 | $ 209,000 | $ 70,000 |
DERIVATIVE FINANCIAL INSTRUME_4
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES - AOCI (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||||
Sep. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | $ 966,260 | $ 617,275 | $ 624,440 | $ 624,485 | $ 626,705 | $ 617,275 | $ 626,705 |
Other comprehensive income before reclassifications | 0 | 214 | 0 | 1,973 | |||
Amounts reclassified from accumulated other comprehensive income (loss) | 0 | (397) | (1,806) | (566) | |||
Net current period other comprehensive income | 0 | (1,806) | (183) | 407 | 1,183 | (1,806) | 1,407 |
Ending balance | 360,601 | 909,507 | 623,438 | 624,440 | 624,485 | 360,601 | 623,438 |
Accumulated Net Gain (Loss) from Cash Flow Hedges Attributable to Parent | |||||||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||||||
Beginning balance | 0 | $ 1,806 | 3,221 | $ 1,631 | 1,806 | 1,631 | |
Ending balance | $ 0 | $ 3,038 | $ 3,221 | $ 0 | $ 3,038 |
FAIR VALUE OF FINANCIAL INSTR_3
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair Value of Derivative Financial Instruments (Details) - USD ($) $ in Thousands | Sep. 30, 2019 | Dec. 31, 2018 |
Other assets | Fair Value, Measurements, Recurring | Interest rate swaps | Level 2 | ||
Fair value of financial instruments | ||
Derivative assets | $ 0 | $ 1,630 |
FAIR VALUE OF FINANCIAL INSTR_4
FAIR VALUE OF FINANCIAL INSTRUMENTS - Fair Value of Financial Instruments Not Recorded at Fair Value (Details) $ in Thousands | 12 Months Ended | |
Dec. 31, 2018USD ($)mortgage_loan | Sep. 30, 2019USD ($) | |
Carrying Amount | ||
Liabilities: | ||
Mortgages payable | $ 386,923 | $ 96,919 |
Junior subordinated notes | 25,215 | 25,278 |
Carrying Amount | SBA 7(a) loans receivable, subject to loan-backed notes | ||
Assets: | ||
Loans receivable | 37,031 | 31,404 |
Carrying Amount | SBA 7(a) loans receivable, subject to credit risk | ||
Assets: | ||
Loans receivable | 29,748 | 26,257 |
Carrying Amount | SBA 7(a) loans receivable, subject to secured borrowings | ||
Assets: | ||
Loans receivable | 16,469 | 13,915 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | ||
Liabilities: | ||
Mortgages payable | 377,364 | 101,258 |
Junior subordinated notes | 24,462 | 24,410 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | SBA 7(a) loans receivable, subject to loan-backed notes | ||
Assets: | ||
Loans receivable | 38,357 | 32,658 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | SBA 7(a) loans receivable, subject to credit risk | ||
Assets: | ||
Loans receivable | 30,630 | 27,310 |
Fair Value, Measurements, Nonrecurring | Estimated Fair Value | Level 3 | SBA 7(a) loans receivable, subject to secured borrowings | ||
Assets: | ||
Loans receivable | $ 16,706 | $ 14,015 |
Disposal Group, Held-for-sale, Not Discontinued Operations | ||
Carrying Value | ||
Number of mortgage loans excluded | mortgage_loan | 1 | |
Debt classified as liabilities associated with assets held for sale | $ 28,018 |
FAIR VALUE OF FINANCIAL INSTR_5
FAIR VALUE OF FINANCIAL INSTRUMENTS - Unobservable Inputs (Details) | 9 Months Ended | 12 Months Ended |
Sep. 30, 2019 | Dec. 31, 2018 | |
SBA 7(a) loans receivable, subject to loan-backed notes | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Rate of prepayment | 12.10% | 9.59% |
SBA 7(a) loans receivable, subject to loan-backed notes | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Rate of prepayment | 17.50% | 17.50% |
SBA 7(a) loans receivable, subject to credit risk | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Rate of prepayment | 8.03% | 4.91% |
SBA 7(a) loans receivable, subject to credit risk | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Rate of prepayment | 17.50% | 17.50% |
SBA 7(a) loans receivable, subject to secured borrowings | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Rate of prepayment | 10.29% | 10.29% |
SBA 7(a) loans receivable, subject to secured borrowings | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Rate of prepayment | 17.50% | 17.50% |
Measurement Input, Discount Rate | Mortgages Payable | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for debt | 0.0344 | |
Measurement Input, Discount Rate | Mortgages Payable | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for debt | 0.0462 | |
Measurement Input, Discount Rate | Mortgages Payable | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for debt | 0.0464 | |
Measurement Input, Discount Rate | Junior Subordinated Debt | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for debt | 0.0634 | 0.0705 |
Measurement Input, Discount Rate | SBA 7(a) loans receivable, subject to loan-backed notes | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for loans receivable | 0.0725 | 0.0675 |
Measurement Input, Discount Rate | SBA 7(a) loans receivable, subject to loan-backed notes | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for loans receivable | 0.0900 | 0.0925 |
Measurement Input, Discount Rate | SBA 7(a) loans receivable, subject to credit risk | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for loans receivable | 0.0675 | 0.0675 |
Measurement Input, Discount Rate | SBA 7(a) loans receivable, subject to credit risk | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for loans receivable | 0.0950 | 0.0975 |
Measurement Input, Discount Rate | SBA 7(a) loans receivable, subject to secured borrowings | Minimum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for loans receivable | 0.0850 | 0.0875 |
Measurement Input, Discount Rate | SBA 7(a) loans receivable, subject to secured borrowings | Maximum | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Measurement input for loans receivable | 0.0925 | 0.0950 |
RELATED-PARTY TRANSACTIONS (Det
RELATED-PARTY TRANSACTIONS (Details) $ / shares in Units, ft² in Thousands | Jan. 01, 2019sudsidiary | May 10, 2018 | Oct. 31, 2019$ / sharesshares | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Aug. 07, 2019ft² | May 15, 2019ft² | Dec. 31, 2018USD ($) | Oct. 01, 2015 | Mar. 11, 2014USD ($) |
Related-party transactions | ||||||||||||
Due to related parties | $ 6,740,000 | $ 6,740,000 | $ 10,951,000 | |||||||||
Wholesaling agreement, percent of selling price fee per share | 2.75% | |||||||||||
Stock issuance costs | 497,000 | $ 1,124,000 | ||||||||||
Impairment of real estate | $ 0 | $ 0 | $ 69,000,000 | 0 | ||||||||
CIM Urban REIT Management, L.P. | 0 - 500,000,000 | ||||||||||||
Related-party transactions | ||||||||||||
Quarterly fee percentage | 0.25% | 0.25% | ||||||||||
CIM Urban REIT Management, L.P. | 0 - 500,000,000 | Minimum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 0 | $ 0 | ||||||||||
CIM Urban REIT Management, L.P. | 0 - 500,000,000 | Maximum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 500,000,000 | $ 500,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 500,000,000 - 1,000,000,000 | ||||||||||||
Related-party transactions | ||||||||||||
Quarterly fee percentage | 0.2375% | 0.2375% | ||||||||||
CIM Urban REIT Management, L.P. | 500,000,000 - 1,000,000,000 | Minimum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 500,000,000 | $ 500,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 500,000,000 - 1,000,000,000 | Maximum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 1,000,000,000 | $ 1,000,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 1,000,000,000 - 1,500,000,000 | ||||||||||||
Related-party transactions | ||||||||||||
Quarterly fee percentage | 0.225% | 0.225% | ||||||||||
CIM Urban REIT Management, L.P. | 1,000,000,000 - 1,500,000,000 | Minimum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 1,000,000,000 | $ 1,000,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 1,000,000,000 - 1,500,000,000 | Maximum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 1,500,000,000 | $ 1,500,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 1,500,000,000 - 4,000,000,000 | ||||||||||||
Related-party transactions | ||||||||||||
Quarterly fee percentage | 0.2125% | 0.2125% | ||||||||||
CIM Urban REIT Management, L.P. | 1,500,000,000 - 4,000,000,000 | Minimum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 1,500,000,000 | $ 1,500,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 1,500,000,000 - 4,000,000,000 | Maximum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 4,000,000,000 | $ 4,000,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 4,000,000,000 - 20,000,000,000 | ||||||||||||
Related-party transactions | ||||||||||||
Quarterly fee percentage | 0.10% | 0.10% | ||||||||||
CIM Urban REIT Management, L.P. | 4,000,000,000 - 20,000,000,000 | Minimum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | $ 4,000,000,000 | $ 4,000,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | 4,000,000,000 - 20,000,000,000 | Maximum | ||||||||||||
Related-party transactions | ||||||||||||
Daily average adjusted fair value of investments | 20,000,000,000 | 20,000,000,000 | ||||||||||
CIM Urban REIT Management, L.P. | Asset Management Fees | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 2,424,000 | 4,475,000 | 9,669,000 | 13,350,000 | ||||||||
Due to related parties | 2,457,000 | 2,457,000 | 4,540,000 | |||||||||
CIM Urban REIT Management, L.P. | Property Management Fees | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 494,000 | 1,084,000 | 2,106,000 | 3,289,000 | ||||||||
CIM Management Entities | ||||||||||||
Related-party transactions | ||||||||||||
Due to related parties | 2,454,000 | 2,454,000 | 3,202,000 | |||||||||
CIM Management Entities | Lease Commission Fees | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 32,000 | 67,000 | 610,000 | 286,000 | ||||||||
CIM Management Entities | Personnel Fees | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 837,000 | 1,256,000 | 3,873,000 | 4,523,000 | ||||||||
CIM Management Entities | Construction Management Fees | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 160,000 | 65,000 | 329,000 | 506,000 | ||||||||
CIM Management Entities And Related Parties | ||||||||||||
Related-party transactions | ||||||||||||
Due to related parties | 315,000 | |||||||||||
Due from related parties | 40,000 | 40,000 | ||||||||||
CIM Service Provider, LLC | Base Service Fee | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 275,000 | 270,000 | 827,000 | 809,000 | ||||||||
Fees payable per year under agreement | $ 1,000,000 | |||||||||||
CIM Service Provider, LLC | Master Services Agreement | ||||||||||||
Related-party transactions | ||||||||||||
Due to related parties | 1,175,000 | 1,175,000 | 1,490,000 | |||||||||
Compensation expensed for performing other services | 572,000 | 583,000 | 1,630,000 | 2,138,000 | ||||||||
CIM SBA Staffing, LLC | Personnel Fees | ||||||||||||
Related-party transactions | ||||||||||||
Due to related parties | 563,000 | 563,000 | 1,347,000 | |||||||||
Deferred personnel costs | 38,000 | 97,000 | 82,000 | 233,000 | ||||||||
CIM SBA Staffing, LLC | Expenses Related to Lending Segment Subject to Reimbursement | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 652,000 | 740,000 | 1,840,000 | 1,980,000 | ||||||||
CIM SBA Staffing, LLC | Expenses Related to Corporate Services Subject to Reimbursement | ||||||||||||
Related-party transactions | ||||||||||||
Fees | 58,000 | 53,000 | 189,000 | 198,000 | ||||||||
CIM Management Entities Affiliate | ||||||||||||
Related-party transactions | ||||||||||||
Lease renewal term | 5 years | |||||||||||
Rental and other property income | 28,000 | $ 27,000 | 83,000 | $ 81,000 | ||||||||
CIM Group | Eleven Year Lease | ||||||||||||
Related-party transactions | ||||||||||||
Rental and other property income | 356,000 | 562,000 | ||||||||||
Lease, term of contract | 11 years | |||||||||||
Net rentable area (in sq ft) | ft² | 30 | 32 | ||||||||||
CIM Capital, LLC | ||||||||||||
Related-party transactions | ||||||||||||
Number of subsidiaries | sudsidiary | 4 | |||||||||||
CCO Capital, LLC | Wholesaling Agreement | ||||||||||||
Related-party transactions | ||||||||||||
Due to related parties | 131,000 | 131,000 | 138,000 | |||||||||
Deferred costs | 503,000 | 503,000 | $ 200,000 | |||||||||
Stock issuance costs | $ 337,000 | $ 439,000 | ||||||||||
Subsequent Event | Administrator | ||||||||||||
Related-party transactions | ||||||||||||
Common stock acquired (in shares) | shares | 2,468,390 | |||||||||||
Common stock acquired, percentage of common stock outstanding | 16.90% | |||||||||||
Per share amount of shares acquired (in usd per share) | $ / shares | $ 19.1685 | |||||||||||
Subsequent Event | CIM Group And CIM Commercial Trust Corporation Officers And Directors | ||||||||||||
Related-party transactions | ||||||||||||
Common stock acquired, percentage of common stock outstanding | 19.20% |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($) | Sep. 30, 2018USD ($) | Sep. 30, 2019USD ($)officer | Sep. 30, 2018USD ($) | Dec. 31, 2018USD ($) | |
Commitments and contingencies | ||||||
Outstanding loan commitments to fund loans | $ 14,452 | $ 14,452 | ||||
Future obligations under leases to fund tenant improvements and other future construction obligation | 8,827 | 8,827 | ||||
Restricted cash | $ 21,524 | 11,507 | $ 21,524 | 11,507 | $ 21,524 | $ 22,512 |
Right-of use asset | 170 | 170 | ||||
Lease liability | 170 | 170 | ||||
Rent expense | 69 | 224 | ||||
Rent expense | $ 65 | $ 182 | ||||
Minimum lease payments for remainder of fiscal year | 64 | 64 | ||||
Minimum lease payments for year ended December 31, 2020 | $ 106 | $ 106 | ||||
Employment agreements | Executive Officers | ||||||
Commitments and contingencies | ||||||
Number of officers covered under employment agreement | officer | 2 | |||||
Multiplier used for the calculation of payments in the event of death of employee | 2 | 2 | ||||
Multiplier used for the calculation of payments in the event of disability to employee | 1 | 1 | ||||
Restricted Cash for Tenant Improvements | ||||||
Commitments and contingencies | ||||||
Restricted cash | $ 2,813 | $ 2,813 | ||||
City and County of San Francisco Real Property Transfer Tax Case | Pending Litigation | ||||||
Commitments and contingencies | ||||||
Refund sought for penalties, interest and legal fees paid for real property transfer tax | $ 11,845 |
FUTURE MINIMUM LEASE RENTALS (D
FUTURE MINIMUM LEASE RENTALS (Details) $ in Thousands | Sep. 30, 2019USD ($) |
Leases, Operating [Abstract] | |
2019 (Three months ending December 31, 2019) | $ 12,237 |
2020 | 46,706 |
2021 | 40,832 |
2022 | 37,465 |
2023 | 34,370 |
Thereafter | 83,981 |
Total | $ 255,591 |
CONCENTRATIONS (Details)
CONCENTRATIONS (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2019USD ($)propertystate | Sep. 30, 2018 | Sep. 30, 2019USD ($)propertystate | Sep. 30, 2018 | Dec. 31, 2018USD ($)propertystate | |
Concentrations | |||||
Number of states in which properties are owned | state | 2 | 2 | 2 | ||
Office properties | |||||
Concentrations | |||||
Number of real estate properties owned | 8 | 8 | 16 | ||
Hotel properties | |||||
Concentrations | |||||
Number of real estate properties owned | 1 | 1 | 1 | ||
Parking garages | |||||
Concentrations | |||||
Number of real estate properties owned | 1 | 1 | 2 | ||
Development site | |||||
Concentrations | |||||
Number of real estate properties owned | 1 | 1 | 2 | ||
Parking lot | |||||
Concentrations | |||||
Number of real estate properties owned | 1 | 1 | 1 | ||
Revenues | Tenant Revenue Concentrations | Governmental Tenants | |||||
Concentrations | |||||
Amounts due from tenant revenue concentrations | $ | $ 768 | $ 768 | $ 2,899 | ||
Revenues | Tenant Revenue Concentrations | Kaiser Foundation Health Plan, Inc. | |||||
Concentrations | |||||
Amounts due from tenant revenue concentrations | $ | $ 132 | $ 132 | $ 331 | ||
Revenues | Tenant Revenue Concentrations | Kaiser Foundation Health Plan, Inc. | California | |||||
Concentrations | |||||
Number of properties occupied by tenant revenue concentrations | 2 | ||||
Revenues | Geographical concentrations | |||||
Concentrations | |||||
Concentration risk, percent | 100.00% | 100.00% | 100.00% | 100.00% | |
Revenues | Geographical concentrations | California | |||||
Concentrations | |||||
Concentration risk, percent | 84.10% | 76.20% | 77.70% | 76.90% | |
Revenues | Geographical concentrations | Texas | |||||
Concentrations | |||||
Concentration risk, percent | 7.40% | 3.50% | 5.10% | 3.30% | |
Revenues | Geographical concentrations | Washington, D.C. | |||||
Concentrations | |||||
Concentration risk, percent | 8.50% | 20.30% | 17.20% | 19.80% | |
Real Estate Investments | Geographical concentrations | |||||
Concentrations | |||||
Concentration risk, percent | 100.00% | 100.00% | |||
Real Estate Investments | Geographical concentrations | California | |||||
Concentrations | |||||
Concentration risk, percent | 94.80% | 70.60% | |||
Real Estate Investments | Geographical concentrations | Texas | |||||
Concentrations | |||||
Concentration risk, percent | 5.20% | 2.20% | |||
Real Estate Investments | Geographical concentrations | Washington, D.C. | |||||
Concentrations | |||||
Concentration risk, percent | 0.00% | 27.20% | |||
Office Properties Segment | Revenues | Tenant Revenue Concentrations | Governmental Tenants | |||||
Concentrations | |||||
Concentration risk, percent | 11.20% | 25.30% | 20.00% | 25.40% | |
Office Properties Segment | Revenues | Tenant Revenue Concentrations | Kaiser Foundation Health Plan, Inc. | |||||
Concentrations | |||||
Concentration risk, percent | 22.20% | 13.10% | 15.60% | 13.00% |
SEGMENT DISCLOSURE - Operating
SEGMENT DISCLOSURE - Operating Income (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2019USD ($)property | Sep. 30, 2018USD ($)property | Sep. 30, 2019USD ($)property | Sep. 30, 2018USD ($)property | |
Segment disclosure | ||||
Number of types of commercial real estate properties | property | 2 | 2 | 2 | 2 |
Pro forma revenue | $ 29,215 | $ 47,607 | $ 113,348 | $ 147,445 |
Expenses: | ||||
Interest expense | 2,403 | 6,965 | 8,998 | 20,409 |
General and administrative | 1,384 | 1,205 | 4,793 | 6,496 |
EXPENSES | 26,574 | 48,021 | 198,720 | 144,608 |
Segment net operating income | 2,943 | (414) | 347,732 | 2,837 |
Reportable segments | ||||
Expenses: | ||||
Segment net operating income | 12,927 | 25,332 | 55,754 | 82,909 |
Reportable segments | Office | ||||
Segment disclosure | ||||
Pro forma revenue | 16,885 | 36,440 | 72,380 | 109,141 |
Expenses: | ||||
Operating | 7,205 | 14,459 | 29,677 | 39,770 |
General and administrative | 41 | 83 | 397 | 1,062 |
EXPENSES | 7,246 | 14,542 | 30,074 | 40,832 |
Segment net operating income | 9,639 | 21,898 | 42,306 | 68,309 |
Reportable segments | Hotel | ||||
Segment disclosure | ||||
Pro forma revenue | 8,511 | 8,542 | 29,430 | 29,980 |
Expenses: | ||||
Operating | 6,081 | 5,946 | 19,520 | 19,316 |
General and administrative | 31 | 0 | 108 | 18 |
EXPENSES | 6,112 | 5,946 | 19,628 | 19,334 |
Segment net operating income | 2,399 | 2,596 | 9,802 | 10,646 |
Reportable segments | Lending | ||||
Segment disclosure | ||||
Pro forma revenue | 2,411 | 2,625 | 8,312 | 8,324 |
Expenses: | ||||
Interest expense | 365 | 633 | 1,483 | 1,117 |
Fees to related party | 652 | 740 | 1,840 | 1,980 |
General and administrative | 505 | 414 | 1,343 | 1,273 |
EXPENSES | 1,522 | 1,787 | 4,666 | 4,370 |
Segment net operating income | $ 889 | $ 838 | $ 3,646 | $ 3,954 |
SEGMENT DISCLOSURE - Reconcilia
SEGMENT DISCLOSURE - Reconciliation Of Segment Operating Income (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Segment disclosure | ||||||||
Interest and other income | $ 4,175,000 | $ 3,286,000 | $ 12,955,000 | $ 10,306,000 | ||||
Asset management and other fees to related parties | (3,981,000) | (6,121,000) | (14,155,000) | (18,475,000) | ||||
Interest expense | (2,403,000) | (6,965,000) | (8,998,000) | (20,409,000) | ||||
General and administrative | (1,384,000) | (1,205,000) | (4,793,000) | (6,496,000) | ||||
Transaction costs | (340,000) | (15,000) | (600,000) | (359,000) | ||||
Depreciation and amortization | (5,180,000) | (13,310,000) | (21,995,000) | (39,783,000) | ||||
Loss on early extinguishment of debt | 0 | 0 | (29,982,000) | 0 | ||||
Impairment of real estate | 0 | 0 | (69,000,000) | 0 | ||||
Gain on sale of real estate | 302,000 | 0 | 433,104,000 | 0 | ||||
Income (loss) before provision for income taxes | 2,943,000 | (414,000) | 347,732,000 | 2,837,000 | ||||
Provision for income taxes | (87,000) | (115,000) | (686,000) | (795,000) | ||||
NET INCOME (LOSS) | 2,856,000 | $ 52,567,000 | $ 291,623,000 | (529,000) | $ 1,949,000 | $ 622,000 | 347,046,000 | 2,042,000 |
Net (income) loss attributable to noncontrolling interests | (8,000) | 1,000 | 165,000 | (15,000) | ||||
NET INCOME (LOSS) ATTRIBUTABLE TO THE COMPANY | 2,848,000 | (528,000) | 347,211,000 | 2,027,000 | ||||
Reportable segments | ||||||||
Segment disclosure | ||||||||
Income (loss) before provision for income taxes | 12,927,000 | 25,332,000 | 55,754,000 | 82,909,000 | ||||
Corporate and Reconciling Items | ||||||||
Segment disclosure | ||||||||
Interest and other income | 1,408,000 | 0 | 3,226,000 | 0 | ||||
Asset management and other fees to related parties | (3,329,000) | (5,381,000) | (12,315,000) | (16,495,000) | ||||
Interest expense | (2,038,000) | (6,332,000) | (7,515,000) | (19,292,000) | ||||
General and administrative | $ (807,000) | $ (708,000) | $ (2,945,000) | $ (4,143,000) |
SEGMENT DISCLOSURE - Assets and
SEGMENT DISCLOSURE - Assets and Capital Expenditures and Loan Originations (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Sep. 30, 2019 | Sep. 30, 2018 | Dec. 31, 2018 | |
Segment disclosure | |||
Total assets | $ 659,852 | $ 1,342,401 | |
Total capital expenditures | 11,346 | $ 12,805 | |
Loan originations | 27,421 | 53,320 | |
Total capital expenditures and loan originations | 38,767 | 66,125 | |
Reportable segments | Office | |||
Segment disclosure | |||
Total assets | 458,979 | 1,094,269 | |
Total capital expenditures | 9,500 | 11,462 | |
Reportable segments | Hotel | |||
Segment disclosure | |||
Total assets | 105,478 | 105,845 | |
Total capital expenditures | 1,846 | $ 1,343 | |
Reportable segments | Lending | |||
Segment disclosure | |||
Total assets | 84,588 | 97,465 | |
Non-segment | |||
Segment disclosure | |||
Total assets | $ 10,807 | $ 44,822 |
PRO FORMA FINANCIAL INFORMATI_3
PRO FORMA FINANCIAL INFORMATION (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2019 | Jun. 30, 2019 | Mar. 31, 2019 | Sep. 30, 2018 | Jun. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2019 | Sep. 30, 2018 | |
Disposal Group | ||||||||
Pro forma revenue | $ 29,215 | $ 47,607 | $ 113,348 | $ 147,445 | ||||
Pro forma net income (loss) | 2,856 | $ 52,567 | $ 291,623 | (529) | $ 1,949 | $ 622 | 347,046 | 2,042 |
Pro forma net income (loss) attributable to the Company | $ 2,848 | $ (528) | $ 347,211 | $ 2,027 | ||||
Pro forma net (loss) income attributable to common stockholders per share, basic | $ (0.20) | $ (0.35) | $ 27.36 | $ (0.77) | ||||
Pro forma net (loss) income attributable to common stockholders per share, diluted | $ (0.20) | $ (0.35) | $ 25.36 | $ (0.77) | ||||
Pro Forma | ||||||||
Disposal Group | ||||||||
Pro forma revenue | $ 27,047 | $ 41,193 | $ 97,971 | $ 128,074 | ||||
Pro forma net income (loss) | 1,513 | (1,124) | 412,341 | 102 | ||||
Pro forma net income (loss) attributable to the Company | 1,510 | (1,131) | 412,310 | 65 | ||||
Pro forma net (loss) income attributable to common stockholders | $ (2,960) | $ (5,051) | $ 399,368 | $ (11,312) |
Uncategorized Items - cmct-2019
Label | Element | Value |
Dividends Payable | us-gaap_DividendsPayableCurrentAndNoncurrent | $ 769,000 |
Dividends Payable | us-gaap_DividendsPayableCurrentAndNoncurrent | $ 1,318,000 |