Real Estate Assets

12 Months Ended

Dec. 31, 2017

5. REAL ESTATE ASSETS

The carrying value of the Company’s real estate assets is summarized as follows:

	December 31, 2017			December 31, 2016
Buildings, improvements, and equipment, at cost:
Beginning balance	$	51,156,701		$	30,795,900
Improvements and equipment additions		259,078			180,801
Acquisition of self storage properties		—			17,612,576
Newly developed properties opened for operation		—			2,567,424
Ending balance		51,415,779			51,156,701
Land:
Beginning balance		5,493,814			3,413,814
Acquisition of self storage properties		—			2,080,000
Ending balance		5,493,814			5,493,814
Accumulated depreciation:
Beginning balance		(875,447	)		—
Depreciation expense		(1,382,415	)		(875,447	)
Ending balance		(2,257,862	)		(875,447	)
Construction in progress:
Beginning balance		—			145,539
Current development		393,832			2,470,685
Newly developed properties opened for operation		—			(2,567,424	)
Transfer to prepaid expenses and other assets		—			(48,800	)
Ending balance		393,832			—
Total real estate assets	$	55,045,563		$	55,775,068

The real estate assets as of December 31, 2016 have been adjusted to reflect the appreciated fair value of the self storage properties as of the date of the change in status from an investment company.

During 2017, the Company completed the construction to expand its Merrillville, IN store. The new development adds approximately 13,300 leasable square feet of traditional drive-up storage units, for an aggregate cost of approximately $400,000. The expansion property was placed in service in 2018. The Millbrook, NY expansion, when completed, will add approximately 16,500 of gross square feet of all-climate-controlled units. The planning for the Millbrook, NY expansion is under development and the Company is actively evaluating proposals for its construction. As of December 31, 2017, a final estimate of construction costs has not yet been determined. As of December 31, 2017, development costs for the Millbrook, NY expansion project have been capitalized while the construction costs of the Merrillville, IN expansion are reflected in real estate assets, net on the Company’s consolidated balance sheet.