XML 19 R9.htm IDEA: XBRL DOCUMENT v3.23.1
INVESTMENTS IN REAL ESTATE
 9 Months Ended
Mar. 31, 2023
INVESTMENTS IN REAL ESTATE [Abstract]  
INVESTMENTS IN REAL ESTATE
NOTE 3 – INVESTMENTS IN REAL ESTATE
 
The following tables provide summary information regarding our operating properties which are owned through our subsidiaries. The ownership interest shown below is the percentage of the property owned by the subsidiary, not the percentage of the subsidiary owned by the Parent Company or the Operating Partnership.
 
Consolidated Operating Properties
 
Property Name:
  
Addison Corporate Center
  
Commodore Apartments
  
Pon de Leo Apartments
  
Hollywood Apartments
Property Owner:
  
Addison Property Owner, LLC
  
Madison-PVT Partners LLC
  
PVT-Madison Partners LLC
  
PT Hillview GP, LLC
Location:
  
Windsor, CT
  
Oakland, CA
  
Oakland, CA
  
Hollywood, CA
Number of Tenants:
  
6
  
48
  
39
  
51
Year Built:
  
1980
  
1912
  
1929
  
1917
Ownership Interest:
  
100%
  
100%
  
100%
  
100%
                 
Property Name:   Shoreline Apartments   Satellite Place Office Building   First & Main Office Building   1300 Main Office Building
Property Owner:   MacKenzie BAA IG Shoreline LLC   MacKenzie Satellite Place Corp.   First & Main, LP   1300 Main, LP
Location:   Concord, CA   Duluth, GA   Napa, CA   Napa, CA
Number of Tenants:   77   1   7   8
Year Built:   1968   2002   2001   2020
Ownership Interest:   100%   100%   100%   100%
                 
Property Name:   Woodland Corporate Center   Main Street West Office Building        
Property Owner:   Woodland Corporate Center, Two, LP   Main Street West, LP        
Location:   Woodland, CA   Napa, CA        
Number of Tenants:   14   7        
Year Built:   2004   2007        
Ownership Interest:   100%   100%        
  
The following table presents the allocation of real estate assets acquired during the nine months ended March 31, 2023 based on asset acquisition accounting.

Property Name:   First & Main Office Building  
Acquisition Date:
  
July 23, 2022
  
Purchase Price Allocation
      
Land
  
$
966,315
  
Building
    
15,597,370
  
Site Improvements
    
795,197
  
Tenant Improvements
    
524,399
  
Lease in Place
    
796,341
  
Leasing Commissions
    
347,204
  
Legal & Marketing Lease Up Costs
     52,007  
Total assets acquired
  
19,078,833
  
         
Net leasehold asset (liability)
     (220,100 )
         
Total assets acquired, net
   $
18,858,733  

Property Name:
  
1300 Main Office Building
  
Acquisition Date:
  
October 1, 2022
  
Purchase Price Allocation
      
Land
  
$
805,575
  
Building
    
14,134,096
  
Tenant Improvements
    
323,882
  
Leaseholds
    
44,422
  
Lease In Place
    
682,140
  
Leasing Commissions
    
250,296
  
Legal & Marketing Lease Up Costs
    
57,849
  
Debt Mark-to-Market
    
338,000
  
Solar Finance Lease
    
76,715
  
Total assets acquired
  
$
16,712,975
  

Property Name:   Woodland Corporate Center  
Acquisition Date:   January 3, 2023  
Purchase Price Allocation      
Land   $ 1,840,468  
Building     8,766,789  
Site Improvements     564,014  
Tenant Improvements     397,263  
Lease In Place     790,382  
Leasing Commissions     163,540  
Legal & Marketing Lease Up Costs     77,264  
Total assets acquired     12,599,720  
         
Net leasehold asset (liability)     (74,440 )
         
Total assets acquired, net   $ 12,525,280  

Property Name:
   Main Street West Office Building  
Acquisition Date:
   February 1, 2023  
Purchase Price Allocation      
Land   $ 1,433,698  
Building     24,438,447  
Site Improvements     9,956  
Tenant Improvements     542,390  
Lease In Place     926,521  
Leasing Commissions     379,516  
Legal & Marketing Lease Up Costs     41,152  
Debt Mark-to-Market     717,000  
Total assets acquired     28,488,681  
         
Net leasehold asset (liability)     (222,065 )
         
Total assets acquired, net   $ 28,266,616  


The total depreciation expense of our operating properties for the three and nine months ended March 31, 2023 were $1,047,603 and $2,606,536, respectively. The total depreciation expense of our operating properties for the three and nine months ended March 31, 2022 were $713,955 and $2,001,524, respectively.


Operating Leases:
 
Our real estate assets are leased to tenants under operating leases that contain varying terms and expirations. The leases may have provisions to extend the lease agreements, options for early termination after paying a specified penalty and other terms and conditions as negotiated. We retain substantially all the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, we do not require a security deposit from tenants on our commercial real estate properties, depending upon the terms of the respective leases and the creditworthiness of the tenants. Even when required, security deposits generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of the security deposit. Security deposits received in cash related to tenant leases are included in other accrued liabilities in the accompanying consolidated balance sheets and were immaterial as of March 31, 2023 and June 30, 2022.

The following table presents the components of income from real estate operations for the three and nine months ended March 31, 2023:
 
 
  
Three Months Ended
    
Nine Months Ended
  
 
  
March 31, 2023
    
March 31, 2023
  
 
            
Lease Income - Operating leases
  
$
3,982,146
    
$
9,979,740
  
Variable lease income (1)
    
487,723
      
1,232,884
  
 
  
$
4,469,869
    
$
11,212,624
  
 
 
(1)
Primarily includes tenant reimbursements for utilities and common area maintenance.

The following table presents the components of income from real estate operations for the three and nine months ended March 31, 2022:
 
 
  
Three Months Ended
    
Nine Months Ended
  
 
  
March 31, 2022
    
March 31, 2022
  
 
            
Lease Income - Operating leases
  
$
2,137,406
    
$
6,527,631
  
Variable lease income (1)
    
381,237
      
1,283,808
  
 
  
$
2,518,643
    
$
7,811,439
  
 

 		(1)
Primarily includes tenant reimbursements for utilities and common area maintenance.
 
As of March 31, 2023, the future minimum rental income from our real estate properties under non-cancelable operating leases are as follows:
 
Year ended June 30, :
  
Rental Income
  
2023
  
$
2,262,297
  
2024
    
7,397,044
  
2025
    
5,939,945
  
2026
    
4,577,398
  
2027
    
3,615,567
  
Thereafter
    
12,352,580
  
Total
  
$
36,144,831
  

Lease Intangibles, Above-Market Lease Assets and Below-Market Lease Liabilities, Net
 
As of March 31, 2023, our acquired lease intangibles, above-market lease assets, and below-market lease liabilities were as follows:
 
   
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
                   
Cost
  
$
7,757,557
    
$
419,166
    
$
2,346,666
  
Accumulated amortization
    
(1,676,388
)
    
(41,227
)
    
(811,716
)
Total
  
$
6,081,169
    
$
377,939
    
$
1,534,950
  
                         
Weighted average amortization period (years)
    
4.9
      
5.4
      
5.1
  
 
As of June 30, 2022, our acquired lease intangibles, above-market lease assets and below-market lease liabilities, were as follows:
 
   
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
                   
Cost
  
$
2,889,828
    
$
-
    
$
1,455,317
  
Accumulated amortization
    
(586,168
)
    
-
   
(391,738
)
Total
  
$
2,303,660
    
$
-
    
$
1,063,579
  
                         
Weighted average amortization period (years)
     5.2
      
-
      
4.9
  

Our amortization of lease intangibles, above-market lease assets and below-market lease liabilities for three and nine months ended March 31, 2023, were as follows:
 
    Three Months Ended
 

 
March 31, 2023
  

 
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
Amortization
  
$
588,069
    
$
26,687
     $ (222,424 )

 
  
Nine Months Ended
  
 
  
March 31, 2023
  
 
  
Lease Intangibles
Above-Market
Lease Asset
Below-Market
Lease Liabilities
  
Amortization
  
$
1,090,220
    
$
41,227
    
$
(419,978
)

Our amortization of lease intangibles, above-market lease assets and below-market lease liabilities for three and nine months ended March 31, 2022, were as follows:

 
  
Three Months Ended
  
 
  
March 31, 2022
  
 
  
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
Amortization
  
$
432,540
    
$
31,976
    
$
(69,099
)

 
  
  Nine Months Ended
  
 
  
March 31, 2022
  
 
  
Lease Intangibles
    
Above-Market
Lease Asset
    
Below-Market
Lease Liabilities
  
Amortization
  
$
1,223,665
    
$
95,928
    
$
(217,809
)
 
The following table provides the projected amortization expense and adjustments to revenue from tenants for intangible assets and liabilities for the next five years:
 
   
Year Ended June 30, :
  
   
2023 (remainder)
    
2024
    
2025
    
2026
    
2027
     Thereafter
 
In-place leases, to be included in amortization
  
$
446,347
    
$
1,603,609
    
$
1,285,141
    
$
897,073
    
$
520,119
     $ 1,328,880  
                                                 
Above-market lease intangibles
    
29,426
      
115,725
      
70,864
      
41,731
      
30,177
       90,016  
Below-market lease liabilities
    
(124,859
)
    
(451,247
)
    
(286,084
)
    
(195,626
)
    
(158,666
)
     (318,468 )

 
$
(95,433
)
  
$
(335,522
)
  
$
(215,220
)
  
$
(153,895
)
  
$
(128,489
)
   $ (228,452 )