10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

(Mark One)

þ	QUARTERLYREPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the quarterly period ended March 31, 2019

OR

o	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
	For the transition period from _________ to _________

Commission file number 000-55428

STEADFAST APARTMENT REIT, INC.

(Exact Name of Registrant as Specified in Its Charter)

Maryland	36-4769184
(State or Other Jurisdiction of	(I.R.S. Employer
Incorporation or Organization)	Identification No.)

18100 Von Karman Avenue, Suite 500
Irvine, California	92612
(Address of Principal Executive Offices)	(Zip Code)

(949) 852-0700

(Registrant’s Telephone Number, Including Area Code)

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes þ No ¨

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes þ No ¨

Indicate by check mark whether the registrant is a large accelerated filed, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large Accelerated filer o	Accelerated filer o
Non-Accelerated filer þ	Smaller reporting company o
Emerging growth company þ

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ¨ No þ

Securities registered pursuant to Section 12(b) of the Act: None

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
N/A	N/A	N/A

As of May 3, 2019, there were 52,028,735 shares of the Registrant’s common stock issued and outstanding.

STEADFAST APARTMENT REIT, INC.

INDEX

	Page
PART I — FINANCIAL INFORMATION
Item 1. Financial Statements	2
Consolidated Balance Sheets as of March 31, 2019 (unaudited) and December 31, 2018	2
Consolidated Statements of Operations for the three months ended March 31, 2019 and 2018 (unaudited)	3
Consolidated Statements of Stockholders’ Equity for the three months ended March 31, 2019 and 2018 (unaudited)	4
Consolidated Statements of Cash Flows for the three months ended March 31, 2019 and 2018 (unaudited)	5
Condensed Notes to Consolidated Financial Statements as of March 31, 2019 (unaudited)	7
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations	29
Item 3. Quantitative and Qualitative Disclosures About Market Risk	45
Item 4. Controls and Procedures	46
PART II — OTHER INFORMATION
Item 1. Legal Proceedings	48
Item 1A. Risk Factors	48
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	48
Item 3. Defaults Upon Senior Securities	49
Item 4. Mine Safety Disclosures	49
Item 5. Other Information	49
Item 6. Exhibits	50
Signatures	51

1

PART I — FINANCIAL INFORMATION

Item 1. Financial Statements

STEADFAST APARTMENT REIT, INC.

CONSOLIDATED BALANCE SHEETS

	March 31, 2019			December 31, 2018
	(Unaudited)
ASSETS
Assets:
Real Estate:
Land	$	164,113,072		$	164,113,072
Building and improvements	1,414,902,453			1,411,198,832
Total real estate, cost	1,579,015,525			1,575,311,904
Less accumulated depreciation and amortization	(236,954,186		)	(218,672,162		)
Total real estate, net	1,342,061,339			1,356,639,742
Cash and cash equivalents	52,802,102			58,880,007
Restricted cash	8,470,593			13,858,768
Rents and other receivables	1,707,753			1,836,406
Other assets	3,410,255			2,923,725
Total assets	$	1,408,452,042		$	1,434,138,648
LIABILITIES AND STOCKHOLDERS’ EQUITY
Liabilities:
Accounts payable and accrued liabilities	$	26,709,603		$	32,330,278
Notes Payable, net:
Mortgage notes payable, net	502,044,479			502,143,306
Credit facilities, net	548,156,188			548,012,437
Total notes payable, net	1,050,200,667			1,050,155,743
Distributions payable	3,970,014			3,953,499
Due to affiliates	2,062,145			1,711,168
Total liabilities	1,082,942,429			1,088,150,688
Commitments and contingencies (Note 9)
Stockholders’ Equity:
Preferred stock, $0.01 par value per share; 100,000,000 shares authorized, no shares issued and outstanding	—			—
Common stock, $0.01 par value per share; 999,999,000 shares authorized, 51,939,159 and 51,723,801 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively	519,392			517,238
Convertible stock, $0.01 par value per share; 1,000 shares authorized, issued and outstanding as of March 31, 2019 and December 31, 2018, respectively	10			10
Additional paid-in capital	687,531,131			684,140,823
Cumulative distributions and net losses	(362,540,920		)	(338,670,111		)
Total stockholders’ equity	325,509,613			345,987,960
Total liabilities and stockholders’ equity	$	1,408,452,042		$	1,434,138,648

See accompanying notes to consolidated financial statements.

2

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(Unaudited)

	Three Months Ended March 31,
	2019			2018
Revenues:
Rental income	$	42,316,920		$	40,727,392
Other income	449,690			639,634
Total revenues	42,766,610			41,367,026
Expenses:
Operating, maintenance and management	10,041,264			9,974,835
Real estate taxes and insurance	6,581,189			5,685,380
Fees to affiliates	6,065,648			5,796,678
Depreciation and amortization	18,282,293			17,435,350
Interest expense	12,233,295			9,114,355
Loss on debt extinguishment	41,609			—
General and administrative expenses	1,880,584			1,378,522
Total expenses	55,125,882			49,385,120
Net loss	$	(12,359,272	)	$	(8,018,094	)
Loss per common share — basic and diluted	$	(0.24	)	$	(0.16	)
Weighted average number of common shares outstanding — basic and diluted	51,873,832			50,976,133

See accompanying notes to consolidated financial statements.

3

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY

FOR THE THREE MONTHS ENDED MARCH 31, 2019 (Unaudited)

	Common Stock					Convertible Stock			Additional Paid-In Capital			Cumulative Distributions & Net Losses			Total Stockholders’ Equity
	Shares		Amount			Shares	Amount
BALANCE, December 31, 2018	51,723,801		$	517,238		1,000	$	10	$	684,140,823		$	(338,670,111	)	$	345,987,960
Issuance of common stock	354,319		3,544			—	—		5,375,022			—			5,378,566
Repurchase of common stock	(138,961	)	(1,390		)	—	—		(1,998,610		)	—			(2,000,000		)
Distributions declared	—		—			—	—		—			(11,511,537		)	(11,511,537		)
Amortization of stock-based compensation	—		—			—	—		13,896			—			13,896
Net loss	—		—			—	—		—			(12,359,272		)	(12,359,272		)
BALANCE, March 31, 2019	51,939,159		$	519,392		1,000	$	10	$	687,531,131		$	(362,540,920	)	$	325,509,613
STEADFAST APARTMENT REIT, INC.
CONSOLIDATED STATEMENT OF STOCKHOLDERS’ EQUITY
FOR THE THREE MONTHS ENDED MARCH 31, 2018 (Unaudited)
	Common Stock					Convertible Stock			Additional Paid-In Capital			Cumulative Distributions & Net Losses			Total Stockholders’ Equity
	Shares		Amount			Shares	Amount
BALANCE, December 31, 2017	50,842,640		$	508,426		1,000	$	10	$	633,186,743		$	(243,389,996	)	$	390,305,183
Issuance of common stock	383,906		3,840			—	—		5,697,190			—			5,701,030
Transfers from redeemable common stock	—		—			—	—		37,028,102			—			37,028,102
Repurchase of common stock	(202,172	)	(2,022		)	—	—		(2,884,194		)	—			(2,886,216		)
Distributions declared	—		—			—	—		—			(11,312,463		)	(11,312,463		)
Amortization of stock-based compensation	—		—			—	—		13,839			—			13,839
Net loss	—		—			—	—		—			(8,018,094		)	(8,018,094		)
BALANCE, March 31, 2018	51,024,374		$	510,244		1,000	$	10	$	673,041,680		$	(262,720,553	)	$	410,831,381

See accompanying notes to consolidated financial statements.

4

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)

	Three Months Ended March 31,
	2019			2018
Cash Flows from Operating Activities:
Net loss	$	(12,359,272	)	$	(8,018,094	)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	18,282,293			17,435,350
Loss on disposal of buildings and improvements	2,198			180,041
Amortization of deferred financing costs	247,773			246,274
Amortization of stock-based compensation	13,896			13,839
Change in fair value of interest rate cap agreements	179,616			(447,614		)
Amortization of loan discount	—			88,746
Loss on debt extinguishment	41,609			—
Insurance claim recoveries	(10,092		)	(143,972		)
Changes in operating assets and liabilities:
Rents and other receivables	53,653			(763,375		)
Other assets	540,887			534,681
Accounts payable and accrued liabilities	(5,117,094		)	(1,525,012		)
Due to affiliates	400,596			(513,838		)
Net cash provided by operating activities	2,276,063			7,087,026
Cash Flows from Investing Activities:
Additions to real estate investments	(4,210,470		)	(3,466,412		)
Escrow deposits for pending real estate acquisitions	(1,200,200		)	—
Proceeds from insurance claims	85,092			143,972
Net cash used in investing activities	(5,325,578		)	(3,322,440		)
Cash Flows from Financing Activities:
Principal payments on mortgage notes payable	(244,458		)	(101,943		)
Payments of commissions on sale of common stock	(55,651		)	(56,510		)
Distributions to common stockholders	(6,116,456		)	(5,597,521		)
Repurchase of common stock	(2,000,000		)	(2,886,216		)
Net cash used in financing activities	(8,416,565		)	(8,642,190		)
Net decrease in cash, cash equivalents and restricted cash	(11,466,080		)	(4,877,604		)
Cash, cash equivalents and restricted cash, beginning of the period	72,738,775			38,667,705
Cash, cash equivalents and restricted cash, end of the period	$	61,272,695		$	33,790,101

5

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

(Unaudited)

	Three Months Ended March 31,
	2019		2018
Supplemental Disclosures of Cash Flow Information:
Interest paid	$	11,762,392	$	8,705,963
Supplemental Disclosures of Noncash Flow Transactions:
Distributions payable	$	3,970,014	$	3,900,642
Distributions paid to common stockholders through common stock issuances pursuant to the distribution reinvestment plan	$	5,378,566	$	5,701,030
Redemptions payable	$	2,000,000	$	2,000,000
Accounts payable and accrued liabilities from additions to real estate investments	$	327,788	$	1,718,324
Due to affiliates from additions to real estate investments	$	47,123	$	176,902
Due to affiliates for commissions on sale of common stock	$	244,300	$	505,829
Operating lease right-of-use asset, net	$	6,768	$	—
Operating lease liabilities, net	$	6,833	$	—

See accompanying notes to consolidated financial statements.

6

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

1.Organization and Business

Steadfast Apartment REIT, Inc. (the “Company”) was formed on August 22, 2013, as a Maryland corporation that elected to qualify as a real estate investment trust (“REIT”) commencing with the taxable year ended December 31, 2014. On September 3, 2013, the Company was initially capitalized with the sale of 13,500 shares of common stock to Steadfast REIT Investments, LLC (the “Sponsor”) at a purchase price of $15.00 per share for an aggregate purchase price of $202,500. Steadfast Apartment Advisor, LLC (the “Advisor”), a Delaware limited liability company formed on August 22, 2013, invested $1,000 in the Company in exchange for 1,000 shares of non-participating, non-voting convertible stock (the “Convertible Stock”) as described in Note 6 (Stockholders’ Equity).

The Company owns and operates a diverse portfolio of multifamily properties located in targeted markets throughout the United States. As of March 31, 2019, the Company owned 34 multifamily properties comprising a total of 11,601 apartment homes. The Company may acquire additional multifamily properties or pursue multifamily developments in the future. For more information on the Company’s real estate portfolio, see Note 3 (Real Estate).

Public Offering

On December 30, 2013, the Company commenced its initial public offering to offer a maximum of 66,666,667 shares of common stock for sale to the public at an initial price of $15.00 per share (with discounts available for certain categories of purchasers) (the “Primary Offering”). The Company also registered up to 7,017,544 shares of common stock for sale pursuant to the Company’s distribution reinvestment plan (the “DRP,” and together with the Primary Offering, the “Public Offering”) at an initial price of $14.25 per share. The Company terminated its Public Offering on March 24, 2016, but continues to offer shares of common stock pursuant to the DRP. As of the termination of the Public Offering, the Company had sold 48,625,651 shares of common stock in the Public Offering for gross proceeds of $724,849,631, including 1,011,561 shares of common stock issued pursuant to the DRP for gross offering proceeds of $14,414,752. As of March 31, 2019, the Company had issued 53,275,989 shares of common stock for gross offering proceeds of $793,718,541, including 5,661,962 shares of common stock issued pursuant to the DRP for gross offering proceeds of $83,283,662.

On March 12, 2019, the Company’s board of directors determined an estimated value per share of the Company’s common stock of $15.84 as of December 31, 2018. In connection with the determination of an estimated value per share, the Company’s board of directors determined a price per share for the DRP of $15.84, effective April 1, 2019. The Company’s board of directors may again, from time to time, in its sole discretion, change the price at which the Company offers shares pursuant to the DRP to reflect changes in the Company’s estimated value per share and other factors that the Company’s board of directors deems relevant. 

The business of the Company is externally managed by the Advisor, pursuant to the Advisory Agreement dated December 13, 2013, by and among the Company, Steadfast Apartment REIT Operating Partnership, L.P. (the “Operating Partnership”) and the Advisor (as amended, the “Advisory Agreement”). The Advisory Agreement is subject to annual renewal by the Company’s board of directors. The current term of the Advisory Agreement expires on December 13, 2019. Subject to certain restrictions and limitations, the Advisor manages the Company’s day-to-day operations, manages the Company’s portfolio of properties, sources and presents investment opportunities to the Company’s board of directors and provides investment management services on the Company’s behalf. The Advisor has also entered into an Advisory Services Agreement with Crossroads Capital Advisors, LLC (“Crossroads Capital Advisors”), whereby Crossroads Capital Advisors provides certain advisory services to the Company on behalf of the Advisor. The Company retained Stira Capital Markets Group, LLC (formerly known as Steadfast Capital Markets Group, LLC) (the “Dealer Manager”), an affiliate of the Sponsor, to serve as the dealer manager for the Public Offering. The Dealer Manager was responsible for marketing the Company’s shares of common stock offered pursuant to the Public Offering. The Advisor, along with the Dealer Manager, provides marketing, investor relations and other administrative services on the Company’s behalf.

7

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

Substantially all of the Company’s business is conducted through the Operating Partnership. The Company is the sole general partner of the Operating Partnership. The Company and Steadfast Apartment REIT Limited Partner, LLC, a Delaware limited liability company and a wholly-owned subsidiary of the Company, entered into a Limited Partnership Agreement (the “Partnership Agreement”) on September 3, 2013.

As the Company accepted subscriptions for shares of its common stock, the Company transferred substantially all of the net offering proceeds from its Public Offering to the Operating Partnership as a contribution in exchange for partnership interests and the Company’s percentage ownership in the Operating Partnership increased proportionately. The Partnership Agreement provides that the Operating Partnership is operated in a manner that will enable the Company to (1) satisfy the requirements for being classified as a REIT for tax purposes, (2) avoid any federal income or excise tax liability and (3) ensure that the Operating Partnership will not be classified as a “publicly traded partnership” for purposes of Section 7704 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), which classification could result in the Operating Partnership being taxed as a corporation. In addition to the administrative and operating costs and expenses incurred by the Operating Partnership in acquiring and operating real properties, the Operating Partnership pays all of the Company’s administrative costs and expenses, and such expenses are treated as expenses of the Operating Partnership.

The Company commenced its real estate operations on May 22, 2014, upon acquiring a fee simple interest in a multifamily property located in Spring Hill, Tennessee.

2.Summary of Significant Accounting Policies

There have been no significant changes to the Company’s accounting policies since it filed its audited financial statements in its Annual Report on Form 10-K for the year ended December 31, 2018, other than Accounting Standards Update (“ASU”) 2016-02 and the Securities and Exchange Commission’s (“SEC”) Disclosure Update and Simplification rule (Release 33-10532), as further described below. For further information about the Company’s accounting policies, refer to the Company’s consolidated financial statements and notes thereto for the year ended December 31, 2018, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 14, 2019. 

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company, the Operating Partnership and its subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation. The financial statements of the Company’s subsidiaries are prepared using accounting policies consistent with those of the Company.

The accompanying unaudited consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments that are of a normal and recurring nature and necessary for a fair and consistent presentation of the results of such periods. Operating results for the three months endedMarch 31, 2019, are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The unaudited consolidated financial statements herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

8

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

Fair Value Measurements

Under GAAP, the Company is required to measure certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other assets and liabilities at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories:

• Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

• Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

• Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable.

When available, the Company utilizes quoted market prices from an independent third-party source to determine fair value and will classify such items in Level 1 or Level 2. In instances where the market is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for a financial instrument owned by the Company to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and will establish a fair value by assigning weights to the various valuation sources.

The following describes the valuation methodologies used by the Company to measure fair value, including an indication of the level in the fair value hierarchy in which each asset or liability is generally classified.

Interest rate cap agreements - The Company has entered into certain interest rate cap agreements. These derivatives are recorded at fair value. Fair value was based on a model-driven valuation using the associated variable rate curve and an implied market volatility, both of which were observable at commonly quoted intervals for the full term of the interest rate cap agreements. Therefore, the Company’s interest rate cap agreements were classified within Level 2 of the fair value hierarchy and are included in other assets in the accompanying consolidated balance sheets. Changes in the fair value of the interest rate cap agreements are recorded as interest expense in the accompanying consolidated statements of operations.

The following tables reflect the Company’s assets required to be measured at fair value on a recurring basis on the consolidated balance sheets:

	March 31, 2019
	Fair Value Measurements Using
	Level 1		Level 2		Level 3
Assets:
Interest rate cap agreements	$	—	$	28,153	$	—

9

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

	December 31, 2018
	Fair Value Measurements Using
	Level 1		Level 2		Level 3
Assets:
Interest rate cap agreements	$	—	$	207,769	$	—

Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument.

Fair Value of Financial Instruments

The accompanying consolidated balance sheets include the following financial instruments: cash and cash equivalents, restricted cash, rents and other receivables, accounts payable and accrued liabilities, distributions payable, due to affiliates and notes payable.

The Company considers the carrying value of cash and cash equivalents, restricted cash, rents and other receivables, accounts payable and accrued liabilities and distributions payable to approximate the fair value of these financial instruments based on the short duration between origination of the instruments and their expected realization. The fair value of amounts due to affiliates is not determinable due to the related party nature of such amounts. The Company has determined that its notes payable, net are classified as Level 3 within the fair value hierarchy.

The fair value of the notes payable, net is estimated using a discounted cash flow analysis using borrowing rates available to the Company for debt instruments with similar terms and maturities. As of March 31, 2019 and December 31, 2018, the fair value of the notes payable was $1,071,795,629 and $1,042,358,884, respectively, compared to the carrying value of $1,050,200,667 and $1,050,155,743, respectively.

Distribution Policy

The Company elected to be taxed, and currently qualifies, as a REIT commencing with the taxable year ended December 31, 2014. To maintain its qualification as a REIT, the Company intends to make distributions each taxable year equal to at least 90% of its REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). Distributions declared during the three months ended March 31, 2019, were based on daily record dates and calculated at a rate of $0.002466 per share per day during the period from January 1, 2019, through March 31, 2019. 

Distributions to stockholders are determined by the board of directors of the Company and are dependent upon a number of factors relating to the Company, including funds available for the payment of distributions, financial condition, the timing of property acquisitions, capital expenditure requirements and annual distribution requirements in order for the Company to qualify as a REIT under the Internal Revenue Code. During the three months endedMarch 31, 2019 and 2018, the Company declared distributions totaling $0.222 and $0.222 per share of common stock, respectively.

Per Share Data

Basic loss per share attributable to common stockholders for all periods presented are computed by dividing net loss by the weighted average number of shares of the Company’s common stock outstanding during the period. Diluted loss per share is computed based on the weighted average number of shares of the Company’s common stock and all potentially dilutive securities, if any. Distributions declared per common share assume each share was issued and outstanding each day during the period. Nonvested shares of the Company’s restricted common stock and convertible stock give rise to potentially dilutive shares of the Company’s common stock but such shares were excluded from the computation of diluted earnings per share because such shares were anti-dilutive during the period.

10

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

Segment Disclosure

The Company has determined that it has one reportable segment with activities related to investing in multifamily properties. The Company’s investments in real estate are in different geographic regions, and management evaluates operating performance on an individual asset level. However, as each of the Company’s assets has similar economic characteristics, tenants and products and services, its assets have been aggregated into one reportable segment.

Reclassifications

Certain amounts in the Company’s prior period consolidated financial statements were reclassified to conform to the current presentation. These reclassifications did not change the results of operations of those prior periods. On January 1, 2019, the Company adopted ASU 2016-02, as further described below. As a result, all income earned pursuant to tenant leases is reflected as one line, “Rental Income,” in the consolidated statements of operations. To facilitate comparability, the Company has reclassified prior period’s lease and non-lease income consistently with the current year.

The table below provides a reconciliation of the prior period presentation of the income statement line items that were reclassified in our consolidated statements of operations to conform to the current period presentation, pursuant to the adoption of the new lease accounting standard and election of the single component practical expedient:

	Three Months Ended March 31, 2018
Rental income (presentation prior to January 1, 2019)	$	36,800,334
Tenant reimbursements(1) (presentation prior to January 1, 2019)	3,927,058
Rental income (presentation effective January 1, 2019)	$	40,727,392

______________

(1) Tenant reimbursements include reimbursements for recoverable costs.

Recent Accounting Pronouncements

In February 2016, the FASB established ASC Topic 842, Leases (“ASC 842”), by issuing ASU 2016-02, which requires lessees to recognize right-of-use assets and lease liabilities for operating leases on the balance sheet and disclose key information about leasing arrangements. ASC 842 also makes targeted changes to lessor accounting. ASC 842 was subsequently amended by ASU 2018-01, Land Easement Practical Expedient for Transition to Topic 842 (“ASU 2018-01”), ASU 2018-10, Codification Improvements to Topic 842 (“ASU 2018-10”), ASU 2018-11, Targeted Improvements (ASU 2018-11”) and ASU 2018-20, Leases (Topic 842), Narrow-scope Improvements for Lessors (“ASU 2018-20”). ASC 842 requires a modified retrospective transition approach and was effective in the first quarter of 2019 and allowed for early adoption. The Company elected an optional transition method that allows entities to initially apply ASC 842 at the adoption date (January 1, 2019) and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company evaluated the impact of ASC 842 on its leases both as it relates to the Company acting as a lessee and as a lessor. Based on its evaluation, as it relates to the former, the Company elected to apply each of the practical expedients described in ASC 842-10-65-1(f) that allowed the Company, among other things, to not reassess lease classification conclusions or initial direct cost accounting as of December 31, 2018, therefore these leases continue to be accounted for as operating leases. The Company also elected the practical expedient described in ASC 842-20-25-2 not to apply the recognition requirements in ASC 842 to short-term leases and instead, to recognize lease payments in the consolidated statement of operations on a straight-line basis over the lease term. The Company did not experience a material impact on the recognition of leases in the consolidated financial statements because the quantity of leased equipment by the Company is limited and immaterial to the consolidated financial statements. Upon adoption, the Company recognized an initial operating lease right-of-use asset, net, of $7,656 and an operating lease liability, net, of $7,720.

11

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

As it relates to the Company as lessor, the Company did not experience a material impact on the recognition of leases in the consolidated financial statements because under ASC 842, lessors continue to account for leases using an approach that is substantially equivalent to historical guidance for sales-type leases, direct financing leases, and operating leases. The Company elected a practical expedient which allows lessors to not separate non-lease components from the lease component when the timing and pattern of transfer for the lease components and non-lease components are the same and if the lease component is classified as an operating lease. As a result, on January 1, 2019, the Company began presenting all rentals and reimbursements from tenants as a single line item rental income within the consolidated statements of operations. As of January 1, 2019, the Company implemented changes to its business processes and controls related to accounting for and the presentation and disclosure of leases, including the reclassification of tenant reimbursements, previously disclosed as part of tenant reimbursements and other, to rental income, in the consolidated statements of operations.

Under ASC 842, beginning on January 1, 2019, changes in the probability of collecting tenant rental income could result in direct adjustments of rental income and tenant receivables. The Company did not experience a material impact on its rental income and tenant receivables as of the adoption date.

The Company’s rental income consists of fixed rental payments from tenants under operating leases and is recognized on a straight-line basis over the respective operating lease terms. The Company recognizes minimum rent, including rental abatements, concessions and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the non-cancelable term of the related lease. The Company’s rental income that relates to variable lease payments consists of tenant reimbursements and includes reimbursements for recoverable costs, which are recognized as revenue in the period during which the applicable expenses are incurred and the tenant’s obligation to reimburse the Company arises.

The Company recognized $42,316,920 of rental income related to operating lease payments of which $4,077,927 was for variable lease payments for the three months ended March 31, 2019. For the three months ended March 31, 2019, rental income relating to variable lease payments not included in the measurement of lease receivables was $4,084,886.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (“ASU 2016-13”). ASU 2016-13 requires more timely recording of credit losses on loans and other financial instruments that are not accounted for at fair value through net income (loss), including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other such commitments. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 require the Company to measure all expected credit losses based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the financial assets and eliminates the “incurred loss” methodology in current GAAP. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses (“ASU 2018-19”), which clarifies that operating lease receivables accounted for under ASC 842 Leases, are not in the scope of the new credit losses guidance. The effective date and transition requirements for this guidance are the same as for ASU 2016-13. ASU 2016-13 is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and related disclosures and does not expect a material impact on its consolidated financial statements and related disclosures from its adoption.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement “ASU 2018-13”). The FASB issued ASU 2018-13 to improve the effectiveness of fair value measurement disclosures by adding, eliminating, and modifying certain disclosure requirements. The issuance of ASU 2018-13 is part of a disclosure framework project. The disclosure framework project’s objective and primary focus are to improve the effectiveness of disclosures in the notes to financial statements by facilitating clear communication of the information required by GAAP that is most important to users of each entity’s financial statements. Achieving the objective of improving the effectiveness of the notes to financial statements includes: (1) the development of a framework that promotes consistent decisions by the FASB board about disclosure requirements and (2) the appropriate exercise of discretion by

12

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

reporting entities. The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in FASB Concepts Statement, Conceptual Framework for Financial Reporting-Chapter 8: Notes to Financial Statements, including the consideration of costs and benefits. ASU 2018-13 removed certain disclosure requirements under Topic 820 such as the disclosure requirements of the valuation process for level 3 fair value measurements and modified and added certain of the disclosure requirements in Topic 820. ASU 2018-13 requires prospective and retrospective application depending on the amendment and is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact ASU 2018-13 will have on its consolidated financial statements and related disclosures and believes that certain disclosures of interest rate cap agreements in its consolidated financial statements may be impacted by the adoption of ASU 2018-13.

The SEC’s Disclosure Update and Simplification rule (Release 33-10532) amends the interim financial statement requirements to require a reconciliation of changes in stockholder’ equity in the notes or as a separate statement. This analysis should reconcile the beginning balance to the ending balance of each caption in stockholders’ equity for each period for which an income statement is required to be filed and comply with the remaining content requirements of Rule 3-04 of Regulation S-X. As a result, registrants will have to provide the reconciliation for both the year-to-date and quarterly periods and comparable periods in Form 10-Q but only for the year-to-date periods in registration statements. The rule does not prescribe the format of the presentation as long as the appropriate periods are provided. Per a Compliance and Disclosure Interpretation (Q 105.09, Exchange Act Forms, 10-Q), “The amendments are effective for all filings made on or after November 5, 2018. In light of the timing of effectiveness of the amendments and proximity of effectiveness to the filing date for most filers’ quarterly reports, the staff would not object if the filer’s first presentation of the changes in the shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments.” This allows the Company to adopt the amendment for the Company’s first quarter 2019 filing. The Company has adopted this guidance in the three months ended March 31, 2019 by presenting a reconciliation of changes in stockholders’ equity for the current and prior period as a separate statement.

3.Real Estate

As of March 31, 2019, the Company owned 34 multifamily properties comprising a total of 11,601 apartment homes. The total contract acquisition price of the Company’s real estate portfolio was $1,499,381,750. As of March 31, 2019 and December 31, 2018, the Company’s portfolio was approximately 94.1% and 93.9% occupied and the average monthly rent was $1,171 and $1,163, respectively.

As of March 31, 2019 and December 31, 2018, accumulated depreciation and amortization related to the Company’s consolidated real estate properties was as follows:

	March 31, 2019
	Assets
	Land		Building and Improvements			Total Real Estate
Investments in real estate	$	164,113,072	$	1,414,902,453		$	1,579,015,525
Less: Accumulated depreciation and amortization	—		(236,954,186		)	(236,954,186		)
Net investments in real estate and related lease intangibles	$	164,113,072	$	1,177,948,267		$	1,342,061,339

13

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

	December 31, 2018
	Assets
	Land		Building and Improvements			Total Real Estate
Investments in real estate	$	164,113,072	$	1,411,198,832		$	1,575,311,904
Less: Accumulated depreciation and amortization	—		(218,672,162		)	(218,672,162		)
Net investments in real estate and related lease intangibles	$	164,113,072	$	1,192,526,670		$	1,356,639,742

Depreciation and amortization expense was $18,282,293 and $17,435,350 for the three months ended March 31, 2019 and 2018, respectively, all of which related to the depreciation of the Company’s buildings and improvements.

Operating Leases

As of March 31, 2019, the Company’s real estate portfolio comprised 11,601 residential apartment homes and was 95.8% leased by a diverse group of residents. The residential lease terms consist of lease durations equal to twelve months or less.

Some residential leases contain provisions to extend the lease agreements, options for early termination after paying a specified penalty and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires security deposits from tenants in the form of a cash deposit. Amounts required as security deposits vary depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to tenant leases are included in accounts payables and accrued liabilities in the accompanying consolidated balance sheets and totaled $4,207,869 and $4,130,860 as of March 31, 2019 and December 31, 2018, respectively.

As of March 31, 2019 and 2018, no tenant represented over 10% of the Company’s annualized base rent.

4.Other Assets

As of March 31, 2019 and December 31, 2018, other assets consisted of:

	March 31, 2019		December 31, 2018
Prepaid expenses	$	1,050,608	$	1,690,959
Interest rate cap agreements	28,153		207,769
Escrow deposits for pending real estate acquisitions	1,300,200		100,000
Other deposits	1,024,526		924,997
Operating lease right-of-use assets, net	6,768		—
Other assets	$	3,410,255	$	2,923,725

14

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

5.Debt

Mortgage Notes Payable

The following is a summary of mortgage notes payable, net secured by real property as of March 31, 2019 and December 31, 2018.

	March 31, 2019
			Interest Rate Range				Weighted Average Interest Rate
Type	Number of Instruments	Maturity Date Range	Minimum		Maximum			Principal Outstanding
Variable rate(1)	8	12/1/2024 - 11/1/2025	1-Mo LIBOR + 1.88%		1-Mo LIBOR + 2.28%		4.50%	$	277,432,000
Fixed rate	7	7/1/2025 - 5/1/2054	4.34	%	4.60	%	4.45%	227,882,876
Mortgage notes payable, gross	15						4.48%	505,314,876
Deferred financing costs, net(2)								(3,270,397		)
Mortgage notes payable, net								$	502,044,479

	December 31, 2018
			Interest Rate Range				Weighted Average Interest Rate
Type	Number of Instruments	Maturity Date Range	Minimum		Maximum			Principal Outstanding
Variable rate(1)	8	12/1/2024 - 11/1/2025	1-Mo LIBOR + 1.88%		1-Mo LIBOR + 2.28%		4.53%	$	277,432,000
Fixed rate	7	7/1/2025 - 5/1/2054	4.34	%	4.60	%	4.45%	228,127,333
Mortgage notes payable, gross	15						4.49%	505,559,333
Deferred financing costs, net(2)								(3,416,027		)
Mortgage notes payable, net								$	502,143,306

___________

(1) See Note 10 (Derivative Financial Instruments) for a discussion of the interest rate cap agreements used to manage the exposure to interest rate movement on the Company’s variable rate loans.

(2) Accumulated amortization related to deferred financing costs as of March 31, 2019 and December 31, 2018, was $1,747,920 and $1,602,290, respectively.

CME Loans

On July 31, 2018, (the “Closing Date”), five indirect wholly-owned subsidiaries of the Company terminated the existing mortgage loans with their lenders for an aggregate principal amount of $131,318,742 and entered into new mortgage loan agreements with PNC Bank, National Association (“PNC Bank”) for an aggregate principal amount of $160,850,000 pursuant to the Freddie Mac Capital Markets Execution Program (“CME”). Each loan agreement provides for a term loan (each a “CME Loan” and, collectively the “CME Loans”) with a maturity date of August 1, 2028, unless the maturity date is accelerated in

15

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

accordance with the loan terms. Each CME Loan accrues interest at a fixed rate of 4.43% per annum. The entire outstanding principal balance and any accrued and unpaid interest on each of the CME Loans are due on the maturity date. Interest only payments on the CME Loans are payable monthly in arrears on specified dates as set forth in each loan agreement and interest and principal payments are due beginning September 1, 2023. Monthly payments are due and payable on the first day of each month, commencing September 1, 2018. The Company paid $643,400 in the aggregate in loan origination fees to PNC Bank in connection with the refinancings, and paid the Advisor a loan coordination fee of $804,250. The CME Loans are included in the mortgage notes payable table above as of March 31, 2019 and December 31, 2018.

Master Credit Facility

On the Closing Date, 16 indirect wholly-owned subsidiaries of the Company terminated the existing mortgage loans with their lenders for an aggregate principal amount of $479,318,649 and entered into a Master Credit Facility Agreement (“MCFA”) with Newmark Group Inc. (“Facility Lender”) for an aggregate principal amount of $551,669,000. The MCFA provides for three tranches: (i) a fixed rate loan in the aggregate principal amount of $331,001,400 that accrues interest at 4.43% per annum; (ii) a fixed rate loan in the aggregate principal amount of $137,917,250 that accrues interest at 4.57%; and (iii) a variable rate loan in the aggregate principal amount of $82,750,350 that accrues interest at the one-month London Interbank Offered Rate (“LIBOR”) plus 1.70%. The loans have a maturity date of August 1, 2028, unless the maturity date is accelerated in accordance with the terms of the loan documents. Interest only payments are payable monthly through August 1, 2025, with interest and principal payments due monthly thereafter. The Company paid $1,930,842 in the aggregate in loan origination fees to the Facility Lender in connection with the refinancings, and paid the Advisor a loan coordination fee of $2,758,345.

Line of Credit

On May 18, 2016, the Company entered into a line of credit facility (the “Line of Credit”) with PNC Bank in an amount not to exceed $65,000,000. The Line of Credit provided for advances (each, an “LOC Loan” and collectively, the “LOC Loans”) solely for the purpose of financing the costs in connection with acquisitions and development of real estate projects and for general corporate purposes (subject to certain debt service and loan to value requirements). The Line of Credit had a maturity date of May 17, 2019, subject to extension (the “LOC Maturity Date”), as further described in the loan agreement (the “LOC Loan Agreement”) entered into by certain of the Company’s wholly-owned subsidiaries with PNC Bank in connection with the acquisition of the Landings of Brentwood Property (the “Mortgaged Property”). Advances made under the Line of Credit were secured by the Mortgaged Property, as evidenced by the LOC Loan Agreement, the Revolving Credit Loan Note (the “LOC Note”), the Deed of Trust and a Guaranty from the Company (the “LOC Guaranty,” together with the LOC Loan Agreement and the LOC Note, the “LOC Loan Documents”).

The Company had the option to select the interest rate in respect of the outstanding unpaid principal amount of the LOC Loans from the following options (the “Interest Rate Options”): (1) the sum of the Base Rate (as defined in the LOC Loan Agreement) plus 0.60%, or (2) a rate per annum fixed for the applicable LIBOR Interest Period (as defined in the LOC Loan Agreement) equal to the sum of LIBOR plus 1.60%. The Company terminated the Line of Credit on January 9, 2019. Monthly interest payments were due and payable in arrears on the first day of each month and on the LOC Maturity Date. In addition to monthly interest payments, the Company paid PNC Bank a non-refundable commitment fee equal to (a) the average daily difference between (i) the maximum principal amount of the LOC Loans minus (ii) the aggregate outstanding principal amount of all advances multiplied by (b) 0.15%. The commitment fee was payable in arrears on the first day of each calendar quarter until the LOC Maturity Date.

16

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

As of March 31, 2019 and December 31, 2018, the advances obtained and certain financing costs incurred under the MCFA and Line of Credit, which is included in credit facilities, net, in the accompanying consolidated balance sheets, are summarized in the following table.

	Amount of Advance as of
	March 31, 2019			December 31, 2018
Principal balance on line of credit, gross(1)	$	—		$	—
Principal balance on master credit facility, gross	551,669,000			551,669,000
Deferred financing costs, neton master credit facility(2)	(3,512,812		)	(3,612,316		)
Deferred financing costs, neton line of credit(3)	—			(44,247		)
Credit facilities, net	$	548,156,188		$	548,012,437

___________

(1) At December 31, 2018, Landings of Brentwood was pledged as collateral pursuant to the Line of Credit. On January 9, 2019, the Company terminated the Line of Credit.

(2) Accumulated amortization related to deferred financing costs in respect of the MCFA as of March 31, 2019 and December 31, 2018, was $528,145 and $428,641, respectively.

(3) Accumulated amortization related to deferred financing costs in respect of the Line of Credit as of March 31, 2019 and December 31, 2018, was $0 and $280,753, respectively.

Maturity and Interest

The following is a summary of the Company’s aggregate maturities as of March 31, 2019:

					Maturities During the Years Ending December 31,
Contractual Obligations	Total		Remainder of 2019		2020		2021		2022		2023		Thereafter
Principal payments on outstanding debt(1)	$	1,056,983,876	$	722,489	$	1,187,673	$	5,119,580	$	5,225,051	$	6,037,673	$	1,038,691,410

___________

(1) Projected principal payments on outstanding debt obligations are based on the terms of the notes payable agreements. Amounts exclude the amortization of deferred financing costs associated with the notes payable.

The Company’s notes payable and credit facility documents contain customary financial and non-financial debt covenants. As of March 31, 2019, the Company was in compliance with all debt covenants.

For the three months ended March 31, 2019 and 2018, the Company incurred interest expense of $12,233,295 and $9,114,355, respectively. Interest expense for the three months ended March 31, 2019 and 2018, includes amortization of deferred financing costs of $247,773 and $246,274, net unrealized losses (gains) from the change in fair value of interest rate cap agreements of $179,616 and $(447,614), amortization of loan discount of $0 and $88,746, Credit Facility commitment fees of $2,137 and $7,397 and costs associated with the refinancing of debt of $0 and $21,472, respectively.

Interest expense of $4,049,641 and $4,006,127 was payable as of March 31, 2019 and December 31, 2018, respectively, and is included in accounts payable and accrued liabilities in the accompanying consolidated balance sheets.

17

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

6.Stockholders’ Equity

General

Under the Company’s Articles of Amendment and Restatement (the “Charter”), the total number of shares of capital stock authorized for issuance is 1,100,000,000 shares, consisting of 999,999,000 shares of common stock with a par value of $0.01 per share, 1,000 shares of convertible stock with a par value of $0.01 per share and 100,000,000 shares designated as preferred stock with a par value of $0.01 per share.

Common Stock

The shares of the Company’s common stock entitle the holders to one vote per share on all matters upon which stockholders are entitled to vote, to receive dividends and other distributions as authorized by the Company’s board of directors in accordance with the Maryland General Corporation Law and to all rights of a stockholder pursuant to the Maryland General Corporation Law. The common stock has no preferences or preemptive, conversion or exchange rights.

On September 3, 2013, the Company issued 13,500 shares of common stock to the Sponsor for $202,500. From inception through March 24, 2016, the date of the termination of the Public Offering, the Company had issued 48,625,651 shares of common stock in its Public Offering for offering proceeds of $640,012,497, including 1,011,561 shares of common stock issued pursuant to the DRP for total proceeds of $14,414,752, net of offering costs of $84,837,134. Following the termination of the Public Offering, the Company continues to offer shares pursuant to the DRP. As of March 31, 2019, the Company had issued 53,275,989 shares of common stock for offering proceeds of $708,881,407, including 5,661,962 shares of common stock issued pursuant to the DRP for total proceeds of $83,283,662, net of offering costs of $84,837,134. The offering costs primarily consisted of selling commissions and dealer manager fees paid in the Primary Offering.

As further discussed in Note 8 (Incentive Award Plan and Independent Director Compensation), the shares of restricted common stock vest and become non-forfeitable in four equal annual installments beginning on the date of grant and ending on the third anniversary of the date of grant or will become fully vested and become non-forfeitable on the earlier to occur of (1) the termination of the independent director’s service as a director due to his or her death or disability, or (2) a change in control of the Company.

The issuance and vesting activity for the three months endedMarch 31, 2019, and year ended December 31, 2018, for the restricted stock issued to the Company’s independent directors as compensation for services in connection with the independent directors’ re-election to the board of directors at the Company’s annual meeting were as follows:

	Three Months Ended March 31, 2019	Year Ended December 31, 2018
Nonvested shares at the beginning of the period	7,497	7,497
Granted shares	—	4,998
Vested shares	—	(4,998	)
Nonvested shares at the end of the period	7,497	7,497

Additionally, the weighted average fair value of restricted common stock issued to the Company’s independent directors for the three months endedMarch 31, 2019, and year ended December 31, 2018, was as follows:

Grant Year	Weighted Average Fair Value
2018	$	15.18
2019	n/a

18

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

Included in general and administrative expenses is $13,896 and $13,839 for the three months ended March 31, 2019 and 2018, for compensation expense related to the issuance of restricted common stock. As of March 31, 2019, the compensation expense related to the issuance of the restricted common stock not yet recognized was $76,363.The weighted average remaining term of the restricted common stock was approximately 1.0 year as of March 31, 2019. As of March 31, 2019, no shares of restricted common stock issued to the independent directors had been forfeited.

Convertible Stock

The Company issued 1,000 shares of Convertible Stock to the Advisor for $1,000. The Convertible Stock will convert into shares of common stock if and when: (A) the Company has made total distributions on the then-outstanding shares of its common stock equal to the original issue price of those shares plus an aggregate 6.0% cumulative, non-compounded, annual return on the original issue price of those shares, (B) the Company lists its common stock for trading on a national securities exchange, or (C) the Advisory Agreement is terminated or not renewed (other than for “cause” as defined in the Advisory Agreement). In the event of a termination or non-renewal of the Advisory Agreement for cause, all of the shares of the Convertible Stock will be repurchased for $1.00. In general, each share of Convertible Stock will convert into a number of shares of common stock equal to 1/1000 of the quotient of (A) 15% of the excess of (1) the Company’s “enterprise value” plus the aggregate value of distributions paid to date on the then outstanding shares of the Company’s common stock over (2) the aggregate purchase price paid by stockholders for those outstanding shares of common stock plus an aggregated 6.0% cumulative, non-compounded, annual return on the original issue price of those outstanding shares, divided by (B) the Company’s enterprise value divided by the number of outstanding shares of common stock on an as-converted basis, in each case calculated as of the date of the conversion.

Preferred Stock

The Charter also provides the Company’s board of directors with the authority to issue one or more classes or series of preferred stock, and prior to the issuance of such shares of preferred stock, the board of directors shall have the power from time to time to classify or reclassify, in one or more series, any unissued shares and designate the preferences, rights and privileges of such shares of preferred stock. The Company’s board of directors is authorized to amend the Charter without the approval of the stockholders to increase the aggregate number of authorized shares of capital stock or the number of shares of any class or series that the Company has authority to issue. As of March 31, 2019 and December 31, 2018, no shares of the Company’s preferred stock were issued and outstanding.

Distribution Reinvestment Plan

The Company’s board of directors has approved the DRP through which common stockholders may elect to reinvest an amount equal to the distributions declared on their shares of common stock in additional shares of the Company’s common stock in lieu of receiving cash distributions. The purchase price per share under the DRP was initially $14.25. On March 12, 2019, March 14, 2018 and February 14, 2017, the Company’s board of directors determined a price per share for the DRP of $15.84, $15.18 and $14.85, effective April 1, 2019, April 1, 2018 and March 1, 2017, respectively, in connection with the determination of an estimated value per share of the Company’s common stock.

The Company’s board of directors may again, in its sole discretion, from time to time, change this price based upon changes in the Company’s estimated value per share and other factors that the Company’s board of directors deems relevant.

No sales commissions or dealer manager fees are payable on shares sold through the DRP. The Company’s board of directors may amend, suspend or terminate the DRP at its discretion at any time upon ten days’ notice to the Company’s stockholders. Following any termination of the DRP, all subsequent distributions to stockholders will be made in cash.

Share Repurchase Plan and Redeemable Common Stock

The Company’s share repurchase plan may provide an opportunity for stockholders to have their shares of common stock repurchased by the Company, subject to certain restrictions and limitations. No shares can be repurchased under the Company’s share repurchase plan until after the first anniversary of the date of purchase of such shares; provided, however, that this holding period shall not apply to repurchases requested within two years after the death or disability of a stockholder.

19

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

From March 29, 2016, the date the Company first published an estimated value per share, until April 14, 2018, the purchase price for shares repurchased under the Company’s share repurchase plan was as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of Estimated Value per Share(2)
2 years	95.0% of Estimated Value per Share(2)
3 years	97.5% of Estimated Value per Share(2)
4 years	100.0% of Estimated Value per Share(2)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

On March 14, 2018, the board of directors of the Company determined to amend the terms of the Company’s share repurchase plan effective as of April 15, 2018 to (1) limit the amount of shares repurchased pursuant to the Company’s share repurchase plan each quarter to $2,000,000 and (2) revise the repurchase price to an amount equal to 93% of the most recently publicly disclosed estimated value per share. Pursuant to the amended share repurchase plan, the current share repurchase price is $14.73 per share, which represents 93% of the estimated value per share of $15.84. The share repurchase price is further reduced based on how long the stockholder has held the shares as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of the Share Repurchase Price(5)
2 years	95.0% of the Share Repurchase Price(5)
3 years	97.5% of the Share Repurchase Price(5)
4 years	100.0% of the Share Repurchase Price(5)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

________________

(1) As adjusted for any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares of common stock. Repurchase price includes the full amount paid for each share, including all sales commissions and dealer manager fees. 

(2) The “Estimated Value per Share” is the most recently publicly disclosed estimated value per share determined by the Company’s board of directors.

(3) The required one-year holding period does not apply to repurchases requested within two years after the death or disability of a stockholder.

(4) The purchase price per share for shares repurchased upon the death or disability of a stockholder will be equal to the average issue price per share for all of the stockholder’s shares.

(5) The “Share Repurchase Price” equals 93% of the Estimated Value per Share.

The purchase price per share for shares repurchased pursuant to the Company’s share repurchase plan will be further reduced by the aggregate amount of net proceeds per share, if any, distributed to the Company’s stockholders prior to the Repurchase Date (defined below) as a result of the sale of one or more of the Company’s assets that constitutes a return of capital as a result of such sales.

20

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

Repurchases of shares of the Company’s common stock are made quarterly upon written request to the Company at least 15 days prior to the end of the applicable quarter. Repurchase requests are honored approximately 30 days following the end of the applicable quarter (“Repurchase Date”). Stockholders may withdraw their repurchase request at any time up to three business days prior to the Repurchase Date.

The Company is not obligated to repurchase shares of its common stock under the share repurchase plan. The share repurchase plan limits the number of shares to be repurchased in any calendar year to the lesser of (1) 5% of the weighted average number of shares of common stock outstanding during the prior calendar year and (2) those that could be funded from the net proceeds from the sale of shares under the DRP in the prior calendar year, plus such additional funds as may be reserved for that purpose by the Company’s board of directors. Such sources of funds could include cash on hand, cash available from borrowings and cash from liquidations of securities investments as of the end of the applicable month, to the extent that such funds are not otherwise dedicated to a particular use, such as working capital, cash distributions to stockholders or purchases of real estate assets. The Company’s board of directors has further limited the amount of shares that may be repurchased pursuant to the share repurchase plan to $2,000,000 per quarter effective April 15, 2018. There is no fee in connection with a repurchase of shares of the Company’s common stock pursuant to the Company’s share repurchase plan. As of March 31, 2019, the Company had recognized repurchases payable of $2,000,000, which is included in accounts payable and accrued liabilities on the accompanying consolidated balance sheets.

During the three months ended March 31, 2019, the Company repurchased a total of 138,961 shares with a total repurchase value of $2,000,000 and received requests for repurchases of 440,908 shares with a total repurchase value of $6,413,834. During the three months ended March 31, 2018, the Company repurchased a total of 202,170 shares with a total repurchase value of $2,886,216 and received requests for the repurchase of 309,952 shares with a total repurchase value of $4,262,726, respectively.

As of March 31, 2019 and 2018, the Company’s total outstanding repurchase requests received that were not repurchased pursuant to the Company’s limitations on repurchases (discussed below) were 1,589,499 shares and 309,952 shares, respectively, with a total net repurchase value of $23,205,024 and $4,262,726, respectively.

The Company cannot guarantee that the funds set aside for the share repurchase plan will be sufficient to accommodate all repurchase requests made in any quarter. In the event that the Company does not have sufficient funds available to repurchase all of the shares of the Company’s common stock for which repurchase requests have been submitted in any quarter, priority will be given to repurchase requests in the case of the death or disability of a stockholder. If the Company repurchases less than all of the shares subject to a repurchase request in any quarter, with respect to any shares which have not been repurchased, the Company will treat the shares that have not been repurchased as a request for repurchase in the following quarter pursuant to the limitations of the share repurchase plan and when sufficient funds are available, unless the stockholder withdraws the request for repurchase. Such pending requests will be honored among all requests for repurchases in any given repurchase period as follows: first, pro rata as to repurchases sought upon a stockholder’s death or disability; and, next, pro rata as to other repurchase requests.

The Company’s board of directors may again, in its sole discretion, amend, suspend or terminate the share repurchase plan at any time upon 30 days’ notice to its stockholders if it determines that the funds available to fund the share repurchase plan are needed for other business or operational purposes or that amendment, suspension or termination of the share repurchase plan is in the best interest of the Company’s stockholders. Therefore, a stockholder may not have the opportunity to make a repurchase request prior to any potential termination or suspension of the Company’s share repurchase plan. The share repurchase plan will terminate in the event that a secondary market develops for the Company’s shares of common stock.

Pursuant to the share repurchase plan, for the three months endedMarch 31, 2019, the Company had no amounts to reclassify from temporary equity to permanent equity. For the three months endedMarch 31, 2018, the Company reclassified $37,028,102, net of $2,886,216 of fulfilled redemption requests, from temporary equity to permanent equity, which is included in additional paid-in capital on the accompanying consolidated balance sheets.

21

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

Distributions

The Company’s long-term goal is to pay distributions solely from cash flow from operations. However, because the Company may receive income from interest or rents at various times during the Company’s fiscal year and because the Company may need cash flow from operations during a particular period to fund capital expenditures and other expenses, the Company expects that at times during the Company’s operational stage, the Company will declare distributions in anticipation of cash flow that the Company expects to receive during a later period, and the Company expects to pay these distributions in advance of its actual receipt of these funds. The Company’s board of directors has the authority under its organizational documents, to the extent permitted by Maryland law, to fund distributions from sources such as borrowings, offering proceeds or advances and the deferral of fees and expense reimbursements by the Advisor, in its sole discretion. The Company has not established a limit on the amount of proceeds it may use to fund distributions from sources other than cash flow from operations. If the Company pays distributions from sources other than cash flow from operations, the Company will have fewer funds available and stockholders’ overall return on their investment in the Company may be reduced.

To maintain the Company’s qualification as a REIT, the Company must make aggregate annual distributions to its stockholders of at least 90% of its REIT taxable income (which is computed without regard to the dividends-paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). If the Company meets the REIT qualification requirements, the Company generally will not be subject to federal income tax on the income that the Company distributes to its stockholders each year.

Distributions Declared

The Company’s board of directors approved a cash distribution that accrues at a rate of $0.002466 per day for each share of the Company’s common stock during each of the three months ended March 31, 2019 and 2018, which, if paid over a 365-day period, is equivalent to a 6.0% annualized distribution rate based on a purchase price of $15.00 per share of the Company’s common stock. The distributions declared accrue daily to stockholders of record as of the close of business on each day and are payable in cumulative amounts on or before the third day of each calendar month with respect to the prior month. There is no guarantee that the Company will continue to pay distributions at this rate or at all.

Distributions declared for the three months endedMarch 31, 2019 and 2018 were $11,511,537 and $11,312,463, including $5,343,926 and $5,671,096, or 352,037 shares and 381,892 shares, respectively, of common stock attributable to the DRP.

As of March 31, 2019 and December 31, 2018, $3,970,014 and $3,953,499 of distributions declared were payable, which included $1,826,188 and $1,860,828, or 120,302 shares and 122,584 shares of common stock attributable to the DRP, respectively.

Distributions Paid

For the three months endedMarch 31, 2019 and 2018, the Company paid cash distributions of $6,116,456 and $5,597,521, which related to distributions declared for each day in the period from December 1, 2018, through February 28, 2019, and December 1, 2017, through February 28, 2018, respectively. Additionally, for the three months endedMarch 31, 2019 and 2018, 354,319 and 383,908 shares of common stock were issued pursuant to the DRP for gross offering proceeds of $5,378,566 and $5,701,030, respectively. For the three months endedMarch 31, 2019 and 2018, the Company paid total distributions of $11,495,022 and $11,298,551, respectively.

7.Related Party Arrangements

The Company has entered into the Advisory Agreement with the Advisor. Pursuant to the Advisory Agreement, the Company is obligated to pay the Advisor specified fees upon the provision of certain services related to the investment of funds in real estate and real estate-related investments and the management of the Company’s investments and for other services (including, but not limited to, the disposition of investments). Subject to the limitations described below, the Company is also obligated to reimburse the Advisor and its affiliates for organization and offering costs incurred by the Advisor and its affiliates on behalf of the Company, as well as acquisition and origination expenses and certain operating expenses incurred on behalf of the Company or incurred in connection with providing services to the Company.

22

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

Amounts attributable to the Advisor and its affiliates incurred (earned) for the three months endedMarch 31, 2019 and 2018 and amounts attributable to the Advisor and its affiliates that are payable (prepaid) as of March 31, 2019 and December 31, 2018 are as follows:

	Incurred (Earned) For The Three Months Ended March 31,					Payable (Prepaid) as of
	2019			2018		March 31, 2019			December 31, 2018
Consolidated Statements of Operations:
Expensed
Investment management fees(1)	$	4,160,152		$	4,262,253	$	5,120		$	55,865
Property management:
Fees(1)	1,234,277			1,191,167		414,625			410,424
Reimbursement of on-site personnel(2)	3,727,705			3,562,735		956,003			768,107
Reimbursement of other(1)	671,219			343,258		39,046			41,989
Reimbursement of property operations(2)	23,142			23,649		—			—
Reimbursement of property G&A(3)	34,987			9,299		—			—
Other operating expenses(3)	415,108			261,411		355,927			93,740
Insurance proceeds(4)	—			—		—			(75,000		)
Property insurance(5)	282,315			379,094		(102,677		)	(101,573		)
Rental revenue(6)	(14,745		)	—		—			—
Consolidated Balance Sheets:
Capitalized
Acquisition expenses(7)	64,235			—		—			1,607
Capital expenditures(8)	—			5,622		—			—
Construction management:
Fees(8)	157,899			136,443		21,282			10,281
Reimbursement of labor costs(8)	150,360			232,591		25,841			29,203
Additional paid-in capital
Selling commissions	—			—		244,301			299,952
	$	10,906,654		$	10,407,522	$	1,959,468		$	1,534,595

_____________________

(1) Included in fees to affiliates in the accompanying consolidated statements of operations.

(2) Included in operating, maintenance and management in the accompanying consolidated statements of operations.

(3) Included in general and administrative expenses in the accompanying consolidated statements of operations.

(4) Included in other income in the accompanying consolidated statements of operations.

(5) Property related insurance expense and the amortization of the prepaid insurance deductible account are included in general and administrative expenses in the accompanying consolidated statements of operations. The amortization of the prepaid property insurance is included in operating, maintenance and management expenses in the accompanying

23

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

consolidated statements of operations. The prepaid insurance is included in other assets in the accompanying consolidated balance sheets upon payment.

(6) Included in rental income in the accompanying consolidated statements of operations.

(7) Included in total real estate, cost in the accompanying consolidated balance sheets.

(8) Included in building and improvements in the accompanying consolidated balance sheets.

Investment Management Fee

The Company pays the Advisor a monthly investment management fee equal to one-twelfth of 1.0% of (1) the cost of real properties and real estate related assets acquired directly by the Company or (2) the Company’s allocable cost of each real property or real estate related asset acquired through a joint venture. The investment management fee is calculated including acquisition fees, acquisition expenses, cost of development, construction or improvement and any debt attributable to such investments, or the Company’s proportionate share thereof in the case of investments made through joint ventures.

Acquisition Fees and Expenses

The Company pays the Advisor an acquisition fee equal to 1.0% of the cost of investment, which includes the amount actually paid or budgeted to fund the acquisition, origination, development, construction or improvement of any real property or real estate-related asset acquired. In addition to acquisition fees, the Company reimburses the Advisor for amounts directly incurred by the Advisor and amounts the Advisor pays to third parties in connection with the selection, evaluation, acquisition and development of a property or acquisition of real estate-related assets, whether or not the Company ultimately acquires the property or the real estate-related assets.

The Charter limits the Company’s ability to pay acquisition fees if the total of all acquisition fees and expenses relating to the purchase would exceed 4.5% of the contract purchase price. Under the Charter, a majority of the Company’s board of directors, including a majority of the independent directors, is required to approve any acquisition fees (or portion thereof) that would cause the total of all acquisition fees and expenses relating to an acquisition to exceed 4.5% of the contract purchase price. In connection with the purchase of securities, the acquisition fee may be paid to an affiliate of the Advisor that is registered as a Financial Industry Regulatory Authority, Inc. (“FINRA”) member broker-dealer if applicable FINRA rules would prohibit the payment of the acquisition fee to a firm that is not a registered broker-dealer. 

Loan Coordination Fee

The Company pays the Advisor or its affiliate a loan coordination fee equal to 1.0% of the initial amount of the new debt financed or outstanding debt assumed in connection with the acquisition, development, construction, improvement or origination of a property or a real estate-related asset. In addition, in connection with any financing or the refinancing of any debt (in each case, other than identified at the time of the acquisition of a property or a real estate-related asset), the Company pays the Advisor or its affiliate a loan coordination fee equal to 0.75% of the amount of debt financed or refinanced.

Property Management Fees and Expenses

The Company has entered into property management agreements (each, as amended from time to time, a “Property Management Agreement”) with Steadfast Management Company, Inc., an affiliate of the Sponsor (the “Property Manager”), in connection with the management of each of the Company’s properties. The property management fee payable with respect to each property under the Property Management Agreements at March 31, 2019, ranged from 2.50% to 3.0% of the annual gross revenue collected at the property, as determined by the Advisor and approved by a majority of the Company’s board of directors, including a majority of the independent directors. Each Property Management Agreement has an initial one-year term and continues thereafter on a month-to-month basis unless either party gives 60-days’ prior notice of its desire to terminate the Property Management Agreement, provided that the Company may terminate the Property Management Agreement at any time upon a determination of gross negligence, willful misconduct or bad acts of the Property Manager or its employees or upon an uncured breach of the Property Management Agreement upon 30 days’ prior written notice to the Property Manager.

24

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

In addition to the property management fee, the Property Management Agreements also specify certain other reimbursements payable to the Property Manager for benefit administration, information technology infrastructure, licenses, support and training services and capital expenditures. The Company also reimburses the Property Manager for the salaries and related benefits of on-site property management employees.

Construction Management Fees and Expenses

The Company has entered into construction management agreements (each, a “Construction Management Agreement”) with Pacific Coast Land & Construction, Inc., an affiliate of the Sponsor (the “Construction Manager”), in connection with capital improvements and renovation or value-enhancement projects for certain properties the Company acquires. The construction management fee payable with respect to each property under the Construction Management Agreements ranges from 8.0% to 12.0% of the costs of the improvements for which the Construction Manager has planning and oversight authority. Generally, each Construction Management Agreement can be terminated by either party with 30 days’ prior written notice to the other party. Construction management fees are capitalized to the respective real estate properties in the period in which they are incurred as such costs relate to capital improvements and renovations for apartment homes taken out of service while they undergo the planned renovation.

The Company may also reimburse the Construction Manager for the salaries and related benefits of certain of its employees for time spent working on capital improvements and renovations.

Property Insurance

The Company deposits amounts with an affiliate of the Sponsor to fund a prepaid insurance deductible account to cover the cost of required insurance deductibles across all properties of the Company and other affiliated entities. Upon filing a major claim, proceeds from the insurance deductible account may be used by the Company or another affiliate of the Sponsor. In addition, the Company deposits amounts with an affiliate of the Sponsor to cover the cost of property and property related insurance across certain properties of the Company.

Other Operating Expense Reimbursement

In addition to the various fees paid to the Advisor, the Company is obligated to pay directly or reimburse all expenses incurred by the Advisor in providing services to the Company, including the Company’s allocable share of the Advisor’s overhead, such as rent, employee costs, utilities and information technology costs. The Company will not reimburse the Advisor for employee costs in connection with services for which the Advisor or its affiliates receive acquisition fees or disposition fees or for the salaries the Advisor pays to the Company’s executive officers.

The Charter limits the Company’s total operating expenses during any four fiscal quarters to the greater of 2% of the Company’s average invested assets or 25% of the Company’s net income for the same period (the “2%/25% Limitation”). The Company may reimburse the Advisor, at the end of each fiscal quarter, for operating expenses incurred by the Advisor; provided, however, that the Company shall not reimburse the Advisor at the end of any fiscal quarter for operating expenses that exceed the 2%/25% Limitation unless the independent directors have determined that such excess expenses were justified based on unusual and non-recurring factors. The Advisor must reimburse the Company for the amount by which the Company’s operating expenses for the preceding four fiscal quarters then ended exceed the 2%/25% Limitation, unless approved by the independent directors. For purposes of determining the 2%/25% Limitation amount, “average invested assets” means the average monthly book value of the Company’s assets invested directly or indirectly in equity interests and loans secured by real estate during the 12-month period before deducting depreciation, bad debts reserves or other non-cash reserves. “Total operating expenses” means all expenses paid or incurred by the Company that are in any way related to the Company’s operation, including the Company’s allocable share of Advisor overhead, but excluding (a) the expenses of raising capital such as organization and offering expenses, legal, audit, accounting, underwriting, brokerage, listing, registration and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution, transfer, listing and registration of shares of the Company’s common stock; (b) interest payments; (c) taxes; (d) non-cash expenditures such as depreciation, amortization and bad debt reserves; (e) reasonable incentive fees based on the gain in the sale of the Company’s assets; (f) acquisition fees and acquisition expenses (including expenses relating to potential acquisitions that the Company

25

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

does not close) and investment management fees; (g) real estate commissions on the resale of investments; and (h) other expenses connected with the acquisition, disposition, management and ownership of investments (including the costs of foreclosure, insurance premiums, legal services, maintenance, repair and improvement of real property).

As of March 31, 2019, the Company’s total operating expenses, as defined above, did not exceed the 2%/25% Limitation.

Disposition Fee

If the Advisor or its affiliates provide a substantial amount of services in connection with the sale of a property or real estate-related asset as determined by a majority of the Company’s independent directors, the Company will pay the Advisor or its affiliates one-half of the brokerage commissions paid, but in no event to exceed 1% of the sales price of each property or real estate-related asset sold. To the extent the disposition fee is paid upon the sale of any assets other than real property, it will be included as an operating expense for purposes of the 2%/25% Limitation. In connection with the sale of securities, the disposition fee may be paid to an affiliate of the Advisor that is registered as a FINRA member broker-dealer if applicable FINRA rules would prohibit the payment of the disposition fee to a firm that is not a registered broker-dealer. As of March 31, 2019, the Company had not sold or otherwise disposed of any properties or any real estate-related assets. Accordingly, the Company had not incurred any disposition fees as of March 31, 2019. 

Selling Commissions and Dealer Manager Fees

The Company entered into the Dealer Manager Agreement with the Dealer Manager in connection with the Public Offering. The Company paid the Dealer Manager up to 7% and 3% of the gross offering proceeds from the Primary Offering as selling commissions and dealer manager fees, respectively. The Dealer Manager reallowed 100% of sales commissions earned to participating broker-dealers. The Dealer Manager could also reallow to any participating broker-dealer a portion of the dealer manager fee that was attributable to that participating broker-dealer for certain marketing costs of that participating broker-dealer. The Dealer Manager negotiated the reallowance of the dealer manager fee on a case-by-case basis with each participating broker-dealer subject to various factors associated with the cost of the marketing program. The Company allowed a participating broker-dealer to elect to receive the 7% selling commissions at the time of sale or elect to have the selling commission paid on a trailing basis. A participating broker-dealer that elected to receive a trailing selling commission is paid as follows: 3% at the time of sale and the remaining 4% paid ratably (1% per year) on each of the first four anniversaries of the sale. A reduced sales commission and dealer manager fee was paid in connection with volume discounts and certain other categories of sales. No sales commission or dealer manager fee was paid with respect to shares of common stock issued pursuant to the DRP. The Company terminated the Public Offering on March 24, 2016, and as of March 31, 2019 and December 31, 2018, expects to pay trailing selling commissions of $244,301 and $299,952, respectively, which were charged to additional paid-in capital and included within amounts due to affiliates in the accompanying consolidated balance sheets.

8.Incentive Award Plan and Independent Director Compensation

The Company has adopted an incentive award plan (the “Incentive Award Plan”) that provides for the grant of equity awards to its employees, directors and consultants and those of the Company’s affiliates. The Incentive Award Plan authorizes the grant of non-qualified and incentive stock options, restricted stock awards, restricted stock units, stock appreciation rights, dividend equivalents and other stock-based awards or cash-based awards.

Under the Company’s independent directors’ compensation plan, which is a sub-plan of the Incentive Award Plan, each of the Company’s independent directors received 3,333 shares of restricted common stock once the Company raised $2,000,000 in gross offering proceeds in the Public Offering. Each subsequent independent director that joins the Company’s board of directors receives 3,333 shares of restricted common stock upon election to the Company’s board of directors. In addition, on the date following an independent director’s re-election to the Company’s board of directors, he or she receives 1,666 shares of restricted common stock. One-fourth of the shares of restricted common stock generally vest and become non-forfeitable upon issuance and the remaining portion will vest in three equal annual installments beginning on the date of grant and ending on the third anniversary of the date of grant; provided, however, that the restricted stock will become fully vested and become non-forfeitable on the earlier to occur of (1) the termination of the independent director’s service as a director due to his or her death

26

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

or disability, or (2) a change in control of the Company. These restricted stock awards entitle the holders to participate in distributions even if the shares are not fully vested.

The Company recorded stock-based compensation expense of $13,896 and $13,839 for the three months endedMarch 31, 2019 and 2018, respectively, related to the independent directors’ restricted common stock.

In addition to the stock awards, the Company pays each of its independent directors an annual retainer of $55,000, prorated for any partial term (the audit committee chairperson receives an additional $10,000 annual retainer, prorated for any partial term). The independent directors are also paid for attending meetings as follows: (i) $2,500 for each board meeting attended in person, (ii) $1,500 for each committee meeting attended in person in such director’s capacity as a committee member, (iii) $1,000 for each board meeting attended via teleconference (not to exceed $4,000 for any one set of meetings attended on any given day). All directors also receive reimbursement of reasonable out of pocket expenses incurred in connection with attendance at meetings of the board of directors. Director compensation is an operating expense of the Company that is subject to the operating expense reimbursement obligation of the Advisor discussed in Note 7 (Related Party Arrangements). The Company recorded an operating expense of $152,250 and $55,750 for the three months endedMarch 31, 2019 and 2018, related to the independent directors annual retainer and attending board meetings, which is included in general and administrative expenses in the accompanying consolidated statements of operations. As of March 31, 2019 and December 31, 2018, $219,750 and $151,750, respectively, related to the independent directors’ annual retainer and board meetings attendance is included in accounts payable and accrued liabilities in the consolidated balance sheets.

9.Commitments and Contingencies

Economic Dependency

The Company is dependent on the Advisor for certain services that are essential to the Company, including the identification, evaluation, negotiation, purchase and disposition of real estate and real estate-related investments; management of the daily operations of the Company’s real estate and real estate-related investment portfolio; and other general and administrative responsibilities. In the event that the Advisor is unable to provide such services, the Company will be required to obtain such services from other sources. The Company may not be able to retain services from such other sources on favorable terms or at all.

Concentration of Credit Risk

The geographic concentration of the Company’s portfolio makes it particularly susceptible to adverse economic developments in the Atlanta, Georgia, Dallas/Fort Worth, Texas and Nashville, Tennessee apartment markets. Any adverse economic or real estate developments in these markets, such as business layoffs or downsizing, relocations of businesses, increased competition from other apartment communities, decrease in demand for apartments or any other changes, could adversely affect the Company’s operating results and its ability to make distributions to stockholders.

Environmental

As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. The Company is not aware of any environmental liability that could have a material adverse effect on its financial condition or results of operations. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s properties, the activities of its tenants and other environmental conditions of which the Company is unaware with respect to the properties could result in future environmental liabilities.

Legal Matters

From time to time, the Company is subject, or party, to legal proceedings that arise in the ordinary course of its business. Management is not aware of any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on the Company’s results of operations or financial condition nor is the Company aware of any such legal proceedings contemplated by government agencies.

27

PART I — FINANCIAL INFORMATION (continued)

Item 1. Financial Statements (continued)

STEADFAST APARTMENT REIT, INC.

CONDENSED NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2019

(unaudited)

10.Derivative Financial Instruments

The Company uses interest rate derivatives with the objective of managing exposure to interest rate movements thereby minimizing the effect of interest rate changes and the effect they could have on future cash flows. Interest rate cap agreements are used to accomplish this objective. The following table provides the terms of the Company’s interest rate derivative instruments that were in effect at March 31, 2019 and December 31, 2018:

March 31, 2019
Type	Maturity Date Range	Based on	Number of Instruments	Notional Amount		Variable Rate	Weighted Average Rate Cap	Fair Value
Interest Rate Cap	4/1/2019 - 8/1/2021	One-Month LIBOR	20	$	667,737,850	2.49%	3.47%	$	28,153

December 31, 2018
Type	Maturity Date Range	Based on	Number of Instruments	Notional Amount		Variable Rate	Weighted Average Rate Cap	Fair Value
Interest Rate Cap	1/1/2019 - 8/1/2021	One-Month LIBOR	22	$	713,237,850	2.52%	3.46%	$	207,769

The interest rate cap agreements are not designated as effective cash flow hedges. Accordingly, the Company records any changes in the fair value of the interest rate cap agreements as interest expense. The change in the fair value of the interest rate cap agreements for the three months endedMarch 31, 2019 and 2018, resulted in an unrealized loss of $179,616 and gain of $447,614, respectively, which is included in interest expense in the accompanying consolidated statements of operations. During the three months endedMarch 31, 2019 and 2018, the Company did not acquire any interest rate cap agreements. The fair value of the interest rate cap agreements of $28,153 and $207,769 as of March 31, 2019 and December 31, 2018, respectively, is included in other assets on the accompanying consolidated balance sheets.

11.Subsequent Events

Shares Repurchased

On May 1, 2019, the Company repurchased 135,886 shares of its common stock for a total repurchase value of $2,000,000, or $14.72 per share, pursuant to the Company’s share repurchase program.

Distributions Paid

On April 1, 2019, the Company paid distributions of $3,970,014, which related to distributions declared for each day in the period from March 1, 2019, through March 31, 2019, and consisted of cash distributions paid in the amount of $2,143,826 and $1,826,188 in shares issued pursuant to the DRP.

On May 1, 2019, the Company paid distributions of $3,850,493, which related to distributions declared for each day in the period from April 1, 2019 through April 30, 2019 and consisted of cash distributions paid in the amount of $2,105,481 and $1,745,012 in shares issued pursuant to the DRP.

Distributions Declared

On May 7, 2019, the Company’s board of directors approved and authorized a daily distribution to stockholders of record as of the close of business on each day of the period commencing on July 1, 2019 and ending on September 30, 2019. The distributions will be equal to $0.002466 per share of the Company’s common stock. The distributions for each record date in July 2019, August 2019 and September 2019 will be paid in August 2019, September 2019 and October 2019, respectively. The distributions will be payable to stockholders from legally available funds therefor.

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PART I — FINANCIAL INFORMATION (continued)

Item2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis should be read in conjunction with the accompanying unaudited consolidated financial statements of Steadfast Apartment REIT, Inc. and the notes thereto. As used herein, the terms “we,” “our” and “us” refer to Steadfast Apartment REIT, Inc., a Maryland corporation, and, as required by context, Steadfast Apartment REIT Operating Partnership, L.P., a Delaware limited partnership, which we refer to as our “operating partnership,” and to their subsidiaries.

Forward-Looking Statements

Certain statements included in this Quarterly Report on Form 10-Q that are not historical facts (including any statements concerning investment objectives, other plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto) are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the Exchange Act. These statements are only predictions. We caution that forward-looking statements are not guarantees. Actual events or our investments and results of operations could differ materially from those expressed or implied in any forward-looking statements. Forward-looking statements are typically identified by the use of terms such as “may,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential” or the negative of such terms and other comparable terminology.

The forward-looking statements included herein are based upon our current expectations, plans, estimates, assumptions and beliefs that involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. Factors that could have a material adverse effect on our operations and future prospects include, but are not limited to:

• the fact that we have a limited operating history and commenced operations on May 22, 2014;

• the fact that we have had a net loss for each quarterly and annual period since inception; 

• changes in economic conditions generally and the real estate and debt markets specifically; 

• our ability to secure resident leases for our multifamily properties at favorable rental rates; 

• risks inherent in the real estate business, including resident defaults, potential liability relating to environmental matters and the lack of liquidity of real estate investments; 

• the fact that we pay fees and expenses to our advisor and its affiliates that were not negotiated on an arm’s-length basis and the fact that the payment of these fees and expenses increases the risk that our stockholders will not earn a profit on their investment in us; 

• our ability to retain our executive officers and other key personnel of our advisor, our property manager and other affiliates of our advisor; 

• our ability to generate sufficient cash flows to pay distributions for our stockholders;

• legislative or regulatory changes (including changes to the laws governing the taxation of real estate investment trusts, or REITs); 

• the availability of capital; 

• changes in interest rates; and 

• changes to generally accepted accounting principles, or GAAP.

Any of the assumptions underlying forward-looking statements could be inaccurate. You are cautioned not to place undue reliance on any forward-looking statements included in this quarterly report. All forward-looking statements are made as of the date of this quarterly report and the risk that actual results will differ materially from the expectations expressed in this quarterly report will increase with the passage of time. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements after the date of this quarterly report, whether as a result of new information, future events, changed circumstances or any other reason. In light of the significant uncertainties inherent in the forward-looking statements included in this quarterly report, the inclusion of such forward-looking

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PART I — FINANCIAL INFORMATION (continued)

statements should not be regarded as a representation by us or any other person that the objectives and plans set forth in this quarterly report will be achieved.

All forward looking statements included herein should be read in connection with the risks identified in the “Risk Factors” section of our Annual Report on Form 10-K for the year ended December 31, 2018, filed with the Securities and Exchange Commission, or the SEC, on March 14, 2019.

Overview

We were formed on August 22, 2013, as a Maryland corporation that elected to be taxed as, and qualifies as, a REIT. As described in more detail below, we own and manage a diverse portfolio of 34 multifamily properties, located in the United States comprising a total of 11,601 apartment homes. We may acquire additional multifamily properties or pursue multifamily development projects in the future.

On December 30, 2013, we commenced an initial public offering of up to 66,666,667 shares of common stock at an initial price of $15.00 per share and up to 7,017,544 shares of common stock pursuant to our distribution reinvestment plan at an initial price of $14.25 per share. On March 24, 2016, we terminated our initial public offering. As of March 24, 2016, we had sold 48,625,651 shares of common stock for gross offering proceeds of $724,849,631, including 1,011,561 shares of common stock issued pursuant to our distribution reinvestment plan for gross offering proceeds of $14,414,752. Following the termination of our initial public offering, we have continued to offer shares of our common stock pursuant to our distribution reinvestment plan. As of March 31, 2019, we had sold 53,275,989 shares of common stock for gross proceeds of $793,718,541, including 5,661,962 shares of common stock issued pursuant to our distribution reinvestment plan for gross offering proceeds of $83,283,662.

On March 12, 2019, our board of directors determined an estimated value per share of our common stock of $15.84 as of December 31, 2018. In connection with the determination of an estimated value per share, our board of directors determined a price per share for the distribution reinvestment plan of $15.84, effective April 1, 2019. In the future, our board of directors may, in its sole discretion and from time to time, change the price at which we offer shares pursuant to our distribution reinvestment plan to reflect changes in our estimated value per share and other factors that our board of directors deems relevant.

Subject to certain restrictions and limitations, Steadfast Apartment Advisor, LLC, which we refer to as our “advisor,” manages our day-to-day operations and our portfolio of properties and real estate-related assets. Our advisor sources and presents investment opportunities to our board of directors. Our advisor also provides investment management, marketing, investor relations and other administrative services on our behalf.

Substantially all of our business is conducted through Steadfast Apartment REIT Operating Partnership, L.P., our operating partnership. We are the sole general partner of our operating partnership and one of our wholly-owned subsidiaries is the only limited partner of our operating partnership. As we accepted subscriptions for shares of common stock in our initial public offering, we transferred substantially all of the net proceeds to our operating partnership as a capital contribution. The limited partnership agreement of our operating partnership provides that our operating partnership will be operated in a manner that will enable us to (1) satisfy the requirements for being classified as a REIT for federal income tax purposes, (2) avoid any federal income or excise tax liability and (3) ensure that our operating partnership will not be classified as a “publicly traded partnership” for purposes of Section 7704 of the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code, which classification could result in our operating partnership being taxed as a corporation, rather than as a disregarded entity. In addition to the administrative and operating costs and expenses incurred by our operating partnership in acquiring and operating our investments, our operating partnership will pay all of our administrative costs and expenses, and such expenses will be treated as expenses of our operating partnership.

We elected to be taxed as a REIT under the Internal Revenue Code commencing with our taxable year ended December 31, 2014. As a REIT, we generally will not be subject to federal income tax to the extent that we distribute qualifying dividends to our stockholders. If we fail to qualify as a REIT in any taxable year, we would be subject to federal income tax on our taxable income at regular corporate rates and would not be permitted to qualify for treatment as a REIT for federal income tax purposes for four years following the year in which qualification is lost, unless the Internal Revenue Service grants us relief under certain statutory provisions. Failing to qualify as a REIT could materially and adversely affect our net income and results of operations.

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PART I — FINANCIAL INFORMATION (continued)

Market Outlook

The economy in the United States has improved since the last recession; however, there is no assurance that economic conditions will continue to improve or will not worsen in the future. We believe economic and demographic trends will benefit our existing portfolio and that we have unique future investment opportunities in the multifamily sector. Home ownership rates are at near all-time lows. Demographic and economic factors favor the flexibility of rental housing and discourage the potential financial burden associated with home ownership. Additionally, Millennials and Baby Boomers, the two largest demographic groups comprising roughly half of the total population in the United States, are increasingly choosing rental housing over home ownership. Demographic studies suggest that Baby Boomers are downsizing their suburban homes and relocating to multifamily apartments. Millennials are renting multifamily apartments due to high levels of student debt and increased credit standards in order to qualify for a home mortgage. According to the Federal Reserve Bank of New York, aggregate student debt has surpassed automotive, home equity lines of credit and credit card debt. Millennials are also getting married and having children later and are choosing to live in apartment communities until their mid-30s. Today, 30% of Millennials are still living with their parents or are still in school. When they get a job, Millennials will likely rent moderate income apartments based upon an average income of $45,000 to $65,000. Our plan is to provide rental housing for these generational groups as they age. We believe these factors will continue to contribute to the demand for multifamily housing.

Our Real Estate Portfolio

As of March 31, 2019, we owned the 34 multifamily apartment communities listed below:

									Average Monthly Occupancy(1)				Average Monthly Rent(2)
	Property Name	Location	Purchase Date	Number of Units	Contract Purchase Price		Mortgage Debt Outstanding(3)		March 31, 2019		December 31, 2018		March 31, 2019		December 31, 2018
1	Villages at Spring Hill Apartments	Spring Hill, TN	5/22/2014	176	$	14,200,000	(4)		96.6	%	94.9	%	$	1,088	$	996
2	Harrison Place Apartments	Indianapolis, IN	6/30/2014	307	27,864,250		(4)		92.8	%	95.4	%	973		971
3	Club at Summer Valley	Austin, TX	8/28/2014	260	21,500,000		(4)		94.2	%	92.3	%	909		913
4	Terrace Cove Apartment Homes	Austin, TX	8/28/2014	304	23,500,000		(4)		94.1	%	95.7	%	918		918
5	The Residences on McGinnis Ferry	Suwanee, GA	10/16/2014	696	98,500,000		(4)		93.8	%	93.0	%	1,295		1,282
6	The 1800 at Barrett Lakes	Kennesaw, GA	11/20/2014	500	49,000,000		40,591,953		93.2	%	95.2	%	1,054		1,035
7	The Oasis	Colorado Springs, CO	12/19/2014	252	40,000,000		39,460,102		95.6	%	93.7	%	1,378		1,349
8	Columns on Wetherington	Florence, KY	2/26/2015	192	25,000,000		(4)		96.4	%	94.3	%	1,143		1,153
9	Preston Hills at Mill Creek	Buford, GA	3/10/2015	464	51,000,000		(4)		94.8	%	93.5	%	1,180		1,113
10	Eagle Lake Landing Apartments	Speedway, IN	3/27/2015	277	19,200,000		(4)		93.9	%	94.6	%	887		865
11	Reveal on Cumberland	Fishers, IN	3/30/2015	220	29,500,000		21,619,828		94.5	%	94.5	%	1,102		1,104
12	Randall Highlands Apartments	North Aurora, IL	3/31/2015	146	32,115,000		(4	)	95.2	%	93.2	%	1,848		1,786
13	Heritage Place Apartments	Franklin, TN	4/27/2015	105	9,650,000		8,577,811		96.2	%	96.2	%	1,121		1,130
14	Rosemont at East Cobb	Marietta, GA	5/21/2015	180	16,450,000		13,243,669		93.9	%	92.8	%	1,058		991

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PART I — FINANCIAL INFORMATION (continued)

									Average Monthly Occupancy(1)				Average Monthly Rent(2)
	Property Name	Location	Purchase Date	Number of Units	Contract Purchase Price		Mortgage Debt Outstanding(3)		March 31, 2019		December 31, 2018		March 31, 2019		December 31, 2018
15	Ridge Crossings Apartments	Hoover, AL	5/28/2015	720	$	72,000,000	$	57,621,361	93.5	%	94.7	%	$	972	$	979
16	Bella Terra at City Center	Aurora, CO	6/11/2015	304	37,600,000		(4)		93.8	%	91.8	%	1,146		1,150
17	Hearthstone at City Center	Aurora, CO	6/25/2015	360	53,400,000		(4)		93.6	%	92.2	%	1,222		1,224
18	Arbors at Brookfield	Mauldin, SC	6/30/2015	702	66,800,000		(4)		92.7	%	93.0	%	945		929
19	Carrington Park	Kansas City, MO	8/19/2015	298	39,480,000		(4)		93.6	%	94.0	%	1,036		1,013
20	Delano at North Richland Hills	North Richland Hills, TX	8/26/2015	263	38,500,000		29,801,170		98.1	%	94.3	%	1,431		1,439
21	Meadows at North Richland Hills	North Richland Hills, TX	8/26/2015	252	32,600,000		25,445,546		93.7	%	93.7	%	1,367		1,339
22	Kensington by the Vineyard	Euless, TX	8/26/2015	259	46,200,000		34,093,646		93.4	%	95.0	%	1,459		1,485
23	Monticello by the Vineyard	Euless, TX	9/23/2015	354	52,200,000		41,177,143		95.8	%	95.2	%	1,337		1,336
24	The Shores	Oklahoma City, OK	9/29/2015	300	36,250,000		23,872,874		94.0	%	94.0	%	1,005		1,000
25	Lakeside at Coppell	Coppell, TX	10/7/2015	315	60,500,000		45,223,795		94.3	%	94.6	%	1,703		1,687
26	Meadows at River Run	Bolingbrook, IL	10/30/2015	374	58,500,000		42,905,230		89.6	%	91.4	%	1,339		1,408
27	PeakView at T-Bone Ranch	Greeley, CO	12/11/2015	224	40,300,000		(4)		93.3	%	95.5	%	1,306		1,295
28	Park Valley Apartments	Smyrna, GA	12/11/2015	496	51,400,000		44,706,164		94.4	%	92.9	%	1,006		1,012
29	PeakView by Horseshoe Lake	Loveland, CO	12/18/2015	222	44,200,000		33,704,187		96.8	%	94.1	%	1,389		1,388
30	Stoneridge Farms	Smyrna, TN	12/30/2015	336	47,750,000		—		96.7	%	93.8	%	1,192		1,178
31	Fielder’s Creek	Englewood, CO	3/23/2016	217	32,400,000		—		95.4	%	95.9	%	1,200		1,193
32	Landings of Brentwood	Brentwood, TN	5/18/2016	724	110,000,000		(5)		94.5	%	95.9	%	1,196		1,191
33	1250 West Apartments	Marietta, GA	8/12/2016	468	55,772,500		(4)		91.7	%	90.4	%	1,004		1,008
34	Sixteen50 @ Lake Ray Hubbard	Rockwall, TX	9/29/2016	334	66,050,000		(4)		95.2	%	94.6	%	1,490		1,492
				11,601	$	1,499,381,750	$	502,044,479	94.1	%	93.9	%	$	1,171	$	1,163

_____________________

(1) As of March 31, 2019, our portfolio was approximately 95.8% leased, calculated using the number of occupied and contractually leased units divided by total units.

(2) Average monthly rent is based upon the effective rental income after considering the effect of vacancies, concessions and write-offs.

(3) Mortgage debt outstanding is net of deferred financing costs associated with the loans for each individual property listed above but excludes the principal balance of $551,669,000 and associated deferred financing costs of $3,512,812 related to the refinancings pursuant to our Master Credit Facility Agreement, or MCFA.

(4) Properties secured under the terms of the MCFA.

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PART I — FINANCIAL INFORMATION (continued)

(5) At December 31, 2018, Landings of Brentwood was pledged as collateral pursuant to our line of credit. On January 9, 2019, we terminated the line of credit.

Critical Accounting Policies

The preparation of our financial statements requires significant management judgments, assumptions and estimates about matters that are inherently uncertain. These judgments affect the reported amounts of assets and liabilities and our disclosure of contingent assets and liabilities at the dates of the financial statements and the reported amounts of revenue and expenses during the reporting periods. With different estimates or assumptions, materially different amounts could be reported in our financial statements. Additionally, other companies may utilize different estimates that may impact the comparability of our results of operations to those of companies in similar businesses. A discussion of the accounting policies that management considers critical in that they involve significant management judgments, assumptions and estimates is included in our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the SEC on March 14, 2019. There have been no significant changes to our accounting policies during the period covered by this report, except as discussed in Note 2 (Summary of Significant Accounting Policies) to our condensed consolidated unaudited financial statements in this quarterly report.

Income Taxes

We have elected to be taxed as a REIT under the Internal Revenue Code and have operated as such commencing with the taxable year ended December 31, 2014. To continue to qualify as a REIT, we must meet certain organizational and operational requirements, including a requirement to distribute at least 90% of our annual REIT taxable income to our stockholders (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). As a REIT, we generally will not be subject to federal income tax to the extent we distribute qualifying dividends to our stockholders. If we fail to qualify as a REIT in any taxable year, we would be subject to federal income tax on our taxable income at regular corporate income tax rates and generally would not be permitted to qualify for treatment as a REIT for federal income tax purposes for the four taxable years following the year during which qualification is lost, unless the Internal Revenue Service grants us relief under certain statutory provisions. Such an event could materially adversely affect our net income and net cash available for distribution to stockholders. However, we believe we are organized and operate in such a manner as to qualify for treatment as a REIT.

We follow the income tax guidance under GAAP to recognize, measure, present and disclose in our consolidated financial statements uncertain tax positions that we have taken or expect to take on a tax return. As of March 31, 2019 and December 31, 2018, we did not have any liabilities for uncertain tax positions that we believe should be recognized in our consolidated financial statements. We have not been assessed material interest or penalties by any major tax jurisdictions. Our evaluation was performed for all open tax years through December 31, 2018.

Distributions

Our board of directors has declared daily distributions that are paid on a monthly basis. We expect to continue paying monthly distributions unless our results of operations, our general financial condition, general economic conditions or other factors prohibit us from doing so. We may declare distributions in excess of our cash flow from operations. As a result, our distribution rate and payment frequency may vary from time to time. However, to qualify as a REIT for tax purposes, we must make distributions equal to at least 90% of our “REIT taxable income” each year.

Distributions declared (1) accrue daily to our stockholders of record as of the close of business on each day, (2) are payable in cumulative amounts on or before the third day of each calendar month with respect to the prior month and (3) were calculated at a rate of $0.002466 per share per day during the three months endedMarch 31, 2019 and 2018, which if paid over a 365-day period is equivalent to a 6.0% annualized distribution rate based on a purchase price of $15.00 per share of common stock.

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PART I — FINANCIAL INFORMATION (continued)

The distributions declared and paid during the fiscal quarter ended March 31, 2019, along with the amount of distributions reinvested pursuant to the distribution reinvestment plan were as follows:

					Distributions Paid(3)						Sources of Distributions Paid
Period	Distributions Declared(1)		Distributions Declared Per Share(1)(2)		Cash		Reinvested		Total		Cash Flow From Operations		Cash and Cash Equivalents		Net Cash Provided by Operating Activities
First Quarter 2019	$	11,511,537	$	0.222	$	6,116,456	$	5,378,566	$	11,495,022	$	2,276,063	$	9,218,959	$	2,276,063

____________________

(1) Distributions during the first quarter of 2019 were based on daily record dates and calculated at a rate of $0.002466 per share per day.

(2) Assumes each share was issued and outstanding each day during the period presented.

(3) Distributions are paid on a monthly basis. Distributions for all record dates of a given month are paid approximately three days following month end.

For the three months endedMarch 31, 2019, we paid aggregate distributions of $11,495,022, which was comprised of $6,116,456 of distributions paid in cash and 354,319 shares of our common stock issued pursuant to our distribution reinvestment plan for $5,378,566. For the three months endedMarch 31, 2019, our net loss was $12,359,272, we had funds from operations, or FFO, of $5,923,021 and net cash provided by operations of $2,276,063. For the three months endedMarch 31, 2019, we funded $2,276,063 and $9,218,959, or 20% and 80%, of total distributions paid, including shares issued pursuant to our distribution reinvestment plan, from net cash provided by operating activities and from cash and cash equivalents, respectively. Since inception, of the $163,183,750 in total distributions paid through March 31, 2019, including shares issued pursuant to our distribution reinvestment plan, 67% of such amounts were funded from cash flow from operations, 14% were funded from proceeds from our refinancings, 13% were funded from net public offering proceeds and 6% were funded from cash and cash equivalents. For information on how we calculate FFO and the reconciliation of FFO to net loss, see “—Funds from Operations and Modified Funds from Operations.”

Our long-term policy is to pay distributions solely from cash flow from operations. Because we may receive income from interest or rents at various times during our fiscal year and because we may need cash flow from operations during a particular period to fund capital expenditures and other expenses, we expect that from time to time during our operational stage, we will declare distributions in anticipation of cash flow that we expect to receive during a later period, and we expect to pay these distributions in advance of our actual receipt of these funds. In these instances, our board of directors has the authority under our organizational documents, to the extent permitted by Maryland law, to fund distributions from sources such as borrowings, offering proceeds or advances and the deferral of fees and expense reimbursements by our advisor, in its sole discretion. We have not established a limit on the amount of proceeds we may use from sources other than cash flow from operations to fund distributions. If we pay distributions from sources other than cash flow from operations, we will have fewer funds available for investments.

Inflation

Substantially all of our multifamily property leases are for a term of one year or less. In an inflationary environment, this may allow us to realize increased rents upon renewal of existing leases or the beginning of new leases. Short-term leases generally will minimize our risk from the adverse effects of inflation, although these leases generally permit residents to leave at the end of the lease term and therefore will expose us to the effects of a decline in market rents. In a deflationary rent environment, we may be exposed to declining rents more quickly under these shorter term leases.

With respect to other commercial properties we may own, we expect in the future to include provisions in our leases designed to protect us from the impact of inflation. These provisions may include reimbursement billings for operating expense pass-through charges, real estate tax and insurance reimbursements, or in some cases annual reimbursement of operating expenses above a certain allowance.

As of March 31, 2019, we had not entered into any material leases as a lessee.

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PART I — FINANCIAL INFORMATION (continued)

REIT Compliance

To qualify as a REIT for tax purposes, we are required to distribute at least 90% of our REIT taxable income (which is computed without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP) to our stockholders. We must also meet certain asset and income tests, as well as other requirements. We monitor the operations and transactions that may potentially impact our REIT status. If we fail to qualify as a REIT in any taxable year, we would be subject to federal income tax (including any applicable alternative minimum tax) on our taxable income at regular corporate rates.

Liquidity and Capital Resources

We use secured borrowings, and intend to use in the future secured and unsecured borrowings. At March 31, 2019, our debt was approximately 58% of the value of our properties, as determined by the most recent valuations performed by an independent third-party appraiser as of December 31, 2018. Going forward, we expect that our borrowings will be approximately 55% to 60% of the value of our properties (after debt amortization) and other real estate-related assets. Under our charter, we are prohibited from borrowing in excess of 300% of the value of our net assets, which generally approximates to 75% of the aggregate cost of our assets, though we may exceed this limit only under certain circumstances.

In addition to making investments in accordance with our investment objectives, we use our capital resources to make certain payments to our advisor and its affiliates. During our organization and offering stage, we made payments to the dealer manager for sales commissions and the dealer manager fees and payments to our advisor for reimbursement of certain organization and offering expenses. Currently, during our operating stage, we make payments to our advisor in connection with the acquisition of investments, the management of our assets and costs incurred by our advisor in providing services to us.

Our principal demand for funds will be to fund value-enhancement and other capital improvement projects, to pay operating expenses and interest on our outstanding indebtedness and to make distributions to our stockholders. Over time, we intend to generally fund our cash needs, other than asset acquisitions, from operations. Otherwise, we expect that our principal sources of working capital will include:

• current unrestricted cash balance, which was $52,802,102 as of March 31, 2019;

• various forms of secured and unsecured financing, including the financing of our unencumbered properties;

• borrowings under master repurchase agreements;

• equity capital from joint venture partners; and

• proceeds from our distribution reinvestment plan.

Over the short term, we believe that our sources of capital, specifically our cash balances, cash flow from operations, our ability to raise equity capital from joint venture partners and our ability to obtain various forms of secured and unsecured financing will be adequate to meet our liquidity requirements and capital commitments.

Over the longer term, in addition to the same sources of capital we will rely on to meet our short-term liquidity requirements, we may also conduct additional public or private offerings of our securities, refinance debt or dispose of assets to fund our operating activities, debt service, distributions and future property acquisitions and development projects. We expect these resources will be sufficient to fund our ongoing operating activities as well as providing capital for investment in future development and other joint ventures along with potential forward purchase commitments.

On May 18, 2016, we entered into a secured revolving line of credit, or the line of credit, with PNC Bank in an amount not to exceed $65,000,000. The line of credit provided for advances solely for the purpose of financing the costs in connection with acquisitions and development of real estate projects and for general corporate purposes (subject to certain debt service and loan to value requirements). The line of credit had a maturity date of May 17, 2019, subject to extension, as further described in the loan agreement entered into by certain of our wholly-owned subsidiaries with PNC Bank in connection with the acquisition of the Landings of Brentwood property. As of March 31, 2019 and December 31, 2018, $0 was outstanding on our line of credit. We terminated the line of credit on January 9, 2019. For additional information on our line of credit, see Note 5 (Debt) to the unaudited consolidated financial statements contained in this quarterly report.

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PART I — FINANCIAL INFORMATION (continued)

2018 Refinancing Transactions

On July 31, 2018, or the closing date, 16 of our indirect wholly-owned subsidiaries terminated the existing mortgage loans with their lenders for an aggregate principal amount of $479,318,649 and entered into the MCFA with Newmark Group, Inc., or the facility lender, for an aggregate principal amount of $551,669,000. The MCFA provides for three tranches: (i) a fixed rate loan in the aggregate principal amount of $331,001,400 that accrues interest at 4.43% per annum; (ii) a fixed rate loan in the aggregate principal amount of $137,917,250 that accrues interest at 4.57%; and (iii) a variable rate loan in the aggregate principal amount of $82,750,350 that accrues interest at the one-month LIBOR plus 1.70%. The loans have a maturity date of August 1, 2028, unless the maturity date is accelerated in accordance with the terms of the loan documents. Interest only payments are payable monthly through August 1, 2025, with interest and principal payments due monthly thereafter. We paid $1,930,842 in the aggregate in loan origination fees to the facility lender in connection with the refinancings, and paid our advisor a loan coordination fee of $2,758,345.

Additionally, on the closing date, five of our indirect wholly-owned subsidiaries terminated the existing mortgage loans with their lenders for an aggregate principal amount of $131,318,742 and entered into new loan agreements with PNC Bank for an aggregate principal amount of $160,850,000. Each loan agreement provides for a term loan, or a CME Loan, and, collectively, the CME Loans, with a maturity date of August 1, 2028, unless the maturity date is accelerated with the loan terms. Each CME Loan accrues interest at a fixed rate of 4.43% per annum. The entire outstanding principal balance and any accrued and unpaid interest on each of the CME Loans are due on the maturity date. Interest only payments on the CME Loans are payable monthly in arrears on specified dates as set forth in each loan agreement and interest and principal payments are due beginning September 1, 2023. Monthly payments are due and payable on the first day of each month, commencing September 1, 2018. We paid $643,400 in the aggregate in loan origination fees to PNC Bank in connection with the refinancings, and paid our advisor a loan coordination fee of $804,250.

Cash Flows Provided by Operating Activities

During the three months ended March 31, 2019, net cash provided by operating activities was $2,276,063 compared to $7,087,026 for the three months ended March 31, 2018. The decrease in net cash provided by operating activities is primarily due to the increase in net loss from $8,018,094 during the three months ended March 31, 2018 to $12,359,272 during the three months ended March 31, 2019, and from the decrease in accounts payable and accrued liabilities. We expect to continue to generate cash flows from operations as we stabilize the operations of our property portfolio and complete our value-enhancement program.

Cash Flows Used in Investing Activities

During the three months ended March 31, 2019, net cash used in investing activities was $5,325,578 compared to $3,322,440 during the three months endedMarch 31, 2018. The increase in net cash used in investing activities was primarily the result of the increase in additions to real estate investments during the three months ended March 31, 2019, compared to the three months endedMarch 31, 2018 and an increase in cash used for escrow deposits for pending real estate acquisitions. Net cash used in investing activities during the three months ended March 31, 2019, consisted of the following:

• $4,210,470 of cash used for improvements to real estate investments;

• $1,200,200 of cash used for escrow deposits; and

• $85,092 of cash provided by proceeds from insurance claims.

Cash Flows Used in Financing Activities

During the three months ended March 31, 2019, net cash used in financing activities was $8,416,565 compared to $8,642,190 during the three months endedMarch 31, 2018. The decrease in net cash used in financing activities was due to the decrease in repurchases of common stock during the three months ended March 31, 2019, as a result of the $2,000,000 quarterly limit established in the first quarter of 2018, offset by an increase in cash distributions and principal payments on mortgage notes payable during the three months ended March 31, 2019. Net cash used in financing activities during the three months ended March 31, 2019, consisted of the following:

• $55,651 of payments of commissions on sales of common stock;

• $244,458 of principal payments on mortgage notes payable;

• $2,000,000 of cash paid for the repurchase of common stock; and

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PART I — FINANCIAL INFORMATION (continued)

• $6,116,456 of net cash distributions to our stockholders, after giving effect to distributions reinvested by stockholders of $5,378,566.

Contractual Commitments and Contingencies

We use secured debt, and intend to use in the future secured and unsecured debt. We believe that the careful use of borrowings will help us achieve our diversification goals and potentially enhance the returns on our investments. As of March 31, 2019, our debt was approximately 58% of the value of our properties, as determined by the most recent valuations performed by an independent third-party appraiser as of December 31, 2018. We expect that our borrowings will be approximately 55% to 60% of the value of our properties (after debt amortization) and other real estate-related assets. Under our charter, we are prohibited from borrowing in excess of 300% of our net assets, which generally approximates to 75% of the aggregate cost of our assets unless such excess is approved by a majority of the independent directors and disclosed to stockholders, along with a justification for such excess, in our next quarterly report. In such event, we will monitor our debt levels and take action to reduce any such excess as practicable. Our aggregate borrowings are reviewed by our board of directors at least quarterly. As of March 31, 2019, our aggregate borrowings were not in excess of 300% of the value of our net assets.

In addition to using our capital resources for investing purposes and meeting our debt obligations, we expect to use our capital resources to make certain payments to our advisor in connection with the management of our asset portfolio and costs incurred by our advisor in providing services to us.

As of March 31, 2019, we had indebtedness totaling $1,050,200,667, comprised of an aggregate principal amount of $1,056,983,876 and net deferred financing costs of $6,783,209. The following is a summary of our contractual obligations as of March 31, 2019:

			Payments due by period
Contractual Obligations	Total		Less than 1 year		1-3 years		3-5 years		More than 5 years
Interest payments on outstanding debt obligations(1)	$	219,780,965	$	35,935,065	$	70,536,171	$	44,774,134	$	68,535,595
Principal payments on outstanding debt obligations(2)	1,056,983,876		722,489		6,307,253		11,262,724		1,038,691,410
Total	$	1,276,764,841	$	36,657,554	$	76,843,424	$	56,036,858	$	1,107,227,005

________________

(1) Scheduled interest payments on outstanding debt obligations are based on the outstanding principal amounts and interest rates in effect at March 31, 2019. We incurred interest expense of $12,233,295 during the three months endedMarch 31, 2019, including amortization of deferred financing costs totaling $247,773, net unrealized loss from the change in fair value of interest rate cap agreements of $179,616 and credit facility commitment fees of $2,137, respectively.

(2) Scheduled principal payments on outstanding debt obligations are based on the terms of the notes payable agreements. Amounts exclude net deferred financing costs associated with certain notes payable.

Our debt obligations contain customary financial and non-financial debt covenants. As of March 31, 2019, we were in compliance with all debt covenants.

Results of Operations

Overview

The discussion that follows is based on our consolidated results of operations for the three months ended March 31, 2019 and 2018. The ability to compare one period to another is affected by the implementation of our value-enhancement strategy. As of March 31, 2019 and 2018, we owned 34 multifamily properties. The increase in rents and occupancy are the primary cause of the increase in operating income and expenses, as further discussed below.

Our results of operations for the three months ended March 31, 2019 and 2018, are not indicative of those expected in future periods. For the three months ended March 31, 2019 and 2018, we continued to perform value-enhancement projects, which

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PART I — FINANCIAL INFORMATION (continued)

may have an impact on our future results of operations. In general, we expect that our revenues and expenses related to our portfolio will increase in future periods as a result of organic rent increases and anticipated value-enhancement projects.

To provide additional insight into our operating results, we are also providing a detailed analysis of same-store net operating income, or NOI. For more information on NOI and a reconciliation of NOI (a non-GAAP financial measure) to net loss, see “—Net Operating Income.”

Consolidated Results of Operations for the Three Months EndedMarch 31, 2019 and 2018

The following table summarizes the consolidated results of operations for the three months ended March 31, 2019 and 2018:

	For the Three Months Ended March 31,
	2019			2018			Change $			Change %
Total revenues	$	42,766,610		$	41,367,026		$	1,399,584		3	%
Operating, maintenance and management	(10,041,264		)	(9,974,835		)	(66,429		)	(1	)%
Real estate taxes and insurance	(6,581,189		)	(5,685,380		)	(895,809		)	(16	)%
Fees to affiliates	(6,065,648		)	(5,796,678		)	(268,970		)	(5	)%
Depreciation and amortization	(18,282,293		)	(17,435,350		)	(846,943		)	(5	)%
Interest expense	(12,233,295		)	(9,114,355		)	(3,118,940		)	(34	)%
Loss on debt extinguishment	(41,609		)	—			(41,609		)	(100	)%
General and administrative expenses	(1,880,584		)	(1,378,522		)	(502,062		)	(36	)%
Net loss	$	(12,359,272	)	$	(8,018,094	)	$	(4,341,178	)	(54	)%
NOI(1)	$	24,057,277		$	23,985,291		$	71,986		—	%
FFO(2)	$	5,923,021		$	9,417,256		$	(3,494,235	)	(37	)%
MFFO(2)	$	6,503,003		$	8,969,642		$	(2,466,639	)	(27	)%

______________

(1) NOI is a non-GAAP financial measure used by investors and our management to evaluate and compare the performance of our properties and to determine trends in earnings. However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, interest income and other expense, acquisition costs (those that did not meet the criteria for capitalization under ASU 2017-01, Business Combinations (Topic 805): Clarifying the definition of business, or ASU 2017-01), certain fees to affiliates, depreciation and amortization expense and gains or losses from the sale of our properties and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs, all of which are significant economic costs. For additional information on how we calculate NOI and a reconciliation of NOI to net loss, see “—Net Operating Income.”

(2) GAAP basis accounting for real estate assets utilizes historical cost accounting and assumes real estate values diminish over time. In an effort to overcome the difference between real estate values and historical cost accounting for real estate assets the Board of Governors of NAREIT established the measurement tool of FFO. Since its introduction, FFO has become a widely used non-GAAP financial measure among REITs. Additionally, we use modified funds from operations, or MFFO, as defined by the Institute for Portfolio Alternatives (formerly known as the Investment Program Association), or IPA, as a supplemental measure to evaluate our operating performance. MFFO is based on FFO but includes certain adjustments we believe are necessary due to changes in accounting and reporting under GAAP since the establishment of FFO. Neither FFO nor MFFO should be considered as alternatives to net loss or other measurements under GAAP as indicators of our operating performance, nor should they be considered as alternatives to cash flow from operating activities or other measurements under GAAP as indicators of liquidity. For additional information on how we calculate FFO and MFFO and a reconciliation of FFO and MFFO to net loss, see “—Funds from Operations and Modified Funds from Operations.”

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PART I — FINANCIAL INFORMATION (continued)

Net loss

For the three months endedMarch 31, 2019, we had a net loss of $12,359,272 compared to $8,018,094 for the three months endedMarch 31, 2018. The increase in net loss of $4,341,178 over the comparable prior year period was primarily due to the increase in interest expense of $3,118,940, the increase in real estate taxes and insurance of $895,809, the increase in general and administrative expenses of $502,062, the increase in fees to affiliates of $268,970, the increase in operating, maintenance and management expenses of $66,429, the increase in depreciation and amortization expense of $846,943 and the increase in loss on debt extinguishment of $41,609, partially offset by the increase in total revenues of $1,399,584. 

Total revenues

Total revenues were $42,766,610 for the three months endedMarch 31, 2019, compared to $41,367,026 for the three months endedMarch 31, 2018. The increase of $1,399,584 was primarily due to increases in average monthly occupancy and average monthly rents as a result of ordinary monthly rent increases and the completion of our value-enhancement projects. Average monthly occupancy increased from 92.9% as of March 31, 2018, to 94.1% as of March 31, 2019, and average monthly rents per unit increased from $1,128 as of March 31, 2018, to $1,171 as of March 31, 2019. We expect rental income to increase in future periods as a result of ordinary monthly rent increases, improved occupancy and the implementation of our value-enhancement strategy.

Operating, maintenance and management expenses

Operating, maintenance and management expenses were $10,041,264 for the three months endedMarch 31, 2019, compared to $9,974,835 for the three months endedMarch 31, 2018. The increase of $66,429 was primarily due to increases in utility costs and payroll expenses, offset by a decrease in repairs, maintenance and turnover costs during the three months ended March 31, 2019, compared to the three months ended March 31, 2018. We expect that these amounts will decrease as a percentage of total revenues as we implement operational efficiencies at our multifamily properties.

Real estate taxes and insurance

Real estate taxes and insurance expenses were $6,581,189 for the three months endedMarch 31, 2019, compared to $5,685,380 for the three months endedMarch 31, 2018. The increase of $895,809 was primarily due to increases in real estate taxes as a result of increases in assessed values in Georgia and an increase in insurance costs as a result of an increase in the number of claims filed during the three months ended March 31, 2019, compared to the three months endedMarch 31, 2018. We expect these amounts may increase in future periods as a result of municipal property tax rate increases as well as increases in the assessed value of our property portfolio.

Fees to affiliates

Fees to affiliates were $6,065,648 for the three months endedMarch 31, 2019, compared to $5,796,678 for the three months endedMarch 31, 2018. The increase of $268,970 was primarily due to an increase in the reimbursement of software costs during the three months ended March 31, 2019. We expect fees to affiliates related to the on-going management of our real estate portfolio to increase in future periods as a result of increased investment management fees from anticipated increases in the cost of investments and increased property management fees from anticipated increases in future rental income.

Depreciation and amortization

Depreciation and amortization expenses were $18,282,293 for the three months endedMarch 31, 2019, compared to $17,435,350 for the three months endedMarch 31, 2018. The increase of $846,943 was primarily due to the net increase in depreciable assets of $16,920,625 since March 31, 2018. We expect these amounts to increase slightly in future periods as a result of anticipated future enhancements to our real estate portfolio.

Interest expense

Interest expense for the three months endedMarch 31, 2019, was $12,233,295 compared to $9,114,355 for the three months endedMarch 31, 2018. The increase of $3,118,940 was primarily due to the increase in the notes payable, net balance of $56,561,728 since March 31, 2018, due to financing incurred in connection with the refinancing of 21 multifamily properties since March 31, 2018, as well as increases in LIBOR from March 31, 2018 to March 31, 2019 that impact the interest on our variable rate loans. Included in interest expense is the amortization of deferred financing costs of $247,773 and $246,274, unrealized loss on derivative instruments of $179,616 and unrealized gain of $447,614, amortization of loan discount of $0 and $88,746 and credit facility commitment fees of $2,137 and $7,397 for the three months ended March 31, 2019 and 2018, respectively. We expect interest expense in future periods to vary based on our level of future borrowings, which will depend on

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PART I — FINANCIAL INFORMATION (continued)

the availability and cost of debt financing and the opportunity to acquire real estate and real estate-related investments meeting our investment objectives.

Loss on debt extinguishment

Loss on debt extinguishment for the three months ended March 31, 2019, was $41,609, compared to $0 for the three

months ended March 31, 2018. These expenses consisted of deferred financing costs, net related to the termination of the line of credit during the three months ended March 31, 2019. The loss on debt extinguishment will vary in future periods if we repay the remaining outstanding principal prior to the scheduled maturity dates of the notes payable.

General and administrative expenses

General and administrative expenses for the three months endedMarch 31, 2019, were $1,880,584 compared to $1,378,522 for the three months endedMarch 31, 2018. These general and administrative costs consisted primarily of transfer agent fees, legal fees, insurance premiums, audit fees, other professional fees and independent director compensation. The increase of $502,062 was primarily due to increases in director meeting fees as a result of an increase in the number of meetings compared to the prior year and legal costs incurred during the three months ended March 31, 2019. We expect general and administrative expenses to decrease as a percentage of total revenues.

Property Operations for the Three Months Ended March 31, 2019 Compared to the Three Months Ended March 31, 2018

For purposes of evaluating comparative operating performance, we categorize our properties as “same-store” or “non-same-store.” A “same-store” property is a property that was owned at January 1, 2018. A “non-same-store” property is a property that was acquired, placed into service or disposed of after January 1, 2018. As of March 31, 2019, all of our 34 properties were categorized as same-store properties.

The following table presents the same-store results from operations for the three months ended March 31, 2019 and 2018:

	For the Three Months Ended March 31,
	2019		2018		Change $		Change %
Same-store properties:
Revenues	$	42,585,224	$	41,179,931	$	1,405,293	3.4	%
Operating expenses	18,527,947		17,194,640		1,333,307		7.8	%
Net operating income	24,057,277		23,985,291		71,986		0.3	%
Non-same-store properties:
Net operating income	—		—		—
Total net operating income(1)	$	24,057,277	$	23,985,291	$	71,986

________________

(1) See “—Net Operating Income” below for a reconciliation of NOI to net loss.

Net Operating Income

Same-store net operating income for the three months ended March 31, 2019, was $24,057,277 compared to $23,985,291 for the three months ended March 31, 2018. The 0.3%increase in same-store net operating income was a result of a 3.4%increase in same-store rental revenues partially offset by a 7.8%increase in same-store operating expenses.

Revenues

Same-store revenues for the three months ended March 31, 2019, were $42,585,224 compared to $41,179,931 for the three months ended March 31, 2018. The 3.4%increase in same-store revenues was primarily due to average rent increases at the same-store properties from $1,128 as of March 31, 2018, to $1,171 as of March 31, 2019, as a result of ordinary monthly rent increases and the completion of value-enhancement projects. In addition, same-store occupancy increased from 92.9% as of March 31, 2018, to 94.1% as of March 31, 2019.

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PART I — FINANCIAL INFORMATION (continued)

Operating Expenses

Same-store operating expenses for the three months ended March 31, 2019 were $18,527,947 compared to $17,194,640 for the three months ended March 31, 2018. The increase in same-store operating expenses was primarily attributable to increases in general and administrative expenses, utility costs and property taxes during the three months ended March 31, 2019, compared to the three months ended March 31, 2018.

Net Operating Income

NOI is a non-GAAP financial measure of performance. NOI is used by investors and our management to evaluate and compare the performance of our properties, to determine trends in earnings and to compute the fair value of our properties as it is not affected by (1) the cost of funds, (2) acquisition costs, (3) non-operating fees to affiliates, (4) the impact of depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets that are included in net income computed in accordance with GAAP or (5) general and administrative expenses and other gains and losses that are specific to us. The cost of funds is eliminated from net income (loss) because it is specific to our particular financing capabilities and constraints. The cost of funds is also eliminated because it is dependent on historical interest rates and other costs of capital as well as past decisions made by us regarding the appropriate mix of capital which may have changed or may change in the future. Acquisition costs (those that did not meet the criteria for capitalization under ASU 2017-01) and non-operating fees to affiliates are eliminated because they do not reflect continuing operating costs of the property owner.

Depreciation and amortization expenses as well as gains or losses from the sale of operating real estate assets are eliminated because they may not accurately represent the actual change in value in our multifamily properties that result from use of the properties or changes in market conditions. While certain aspects of real property do decline in value over time in a manner that is reasonably captured by depreciation and amortization, the value of the properties as a whole have historically increased or decreased as a result of changes in overall economic conditions instead of from actual use of the property or the passage of time. Gains and losses from the sale of real property vary from property to property and are affected by market conditions at the time of sale which will usually change from period to period. These gains and losses can create distortions when comparing one period to another or when comparing our operating results to the operating results of other real estate companies that have not made similarly timed purchases or sales. We believe that eliminating these costs from net income (loss) is useful because the resulting measure captures the actual revenue generated and actual expenses incurred in operating our properties as well as trends in occupancy rates, rental rates and operating costs.

However, the usefulness of NOI is limited because it excludes general and administrative costs, interest expense, interest income and other expense, acquisition costs (those that did not meet the criteria for capitalization under ASU 2017-01), certain fees to affiliates, depreciation and amortization expense and gains or losses from the sale of properties, and other gains and losses as stipulated by GAAP, the level of capital expenditures and leasing costs necessary to maintain the operating performance of our properties, all of which are significant economic costs. NOI may fail to capture significant trends in these components of net income which further limits its usefulness.

NOI is a measure of the operating performance of our properties but does not measure our performance as a whole. NOI is therefore not a substitute for net income (loss) as computed in accordance with GAAP. This measure should be analyzed in conjunction with net income (loss) computed in accordance with GAAP and discussions elsewhere in “—Results of Operations” regarding the components of net income (loss) that are eliminated in the calculation of NOI. Other companies may use different methods for calculating NOI or similarly entitled measures and, accordingly, our NOI may not be comparable to similarly entitled measures reported by other companies that do not define the measure exactly as we do.

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PART I — FINANCIAL INFORMATION (continued)

The following is a reconciliation of our NOI to net loss for the three months endedMarch 31, 2019 and 2018, computed in accordance with GAAP:

	For the Three Months Ended March 31,
	2019			2018
Net loss	$	(12,359,272	)	$	(8,018,094	)
Fees to affiliates(1)	4,160,152			4,262,253
Depreciation and amortization	18,282,293			17,435,350
Interest expense	12,233,295			9,114,355
Loss on debt extinguishment	41,609			—
General and administrative expenses	1,880,584			1,378,522
Other gains(2)	(181,384		)	(187,095		)
Net operating income	$	24,057,277		$	23,985,291

____________________

(1) Fees to affiliates for the three months ended March 31, 2019, exclude property management fees of $1,234,277 and other reimbursements of $671,219 that are included in NOI. Fees to affiliates for the three months ended March 31, 2018, exclude property management fees of $1,191,167 and other reimbursements of $343,258 that are included in NOI.

(2) Other gains for the three months ended March 31, 2019 and 2018, includes non-recurring insurance claim recoveries and interest income that are not included in NOI.

Funds from Operations and Modified Funds from Operations

Due to certain unique operating characteristics of real estate companies, as discussed below, NAREIT, an industry trade group, has promulgated a measure known as FFO, which we believe to be an appropriate supplemental measure to reflect the operating performance of a REIT. The use of FFO is recommended by the REIT industry as a supplemental performance measure. FFO is not equivalent to our net income (loss) as determined under GAAP.

We define FFO, a non-GAAP financial measure, consistent with the standards established by the White Paper on FFO approved by the Board of Governors of NAREIT, as revised in December 2018, or the White Paper. The White Paper defines FFO as net income (loss) computed in accordance with GAAP, excluding gains or losses from sales of property and non-cash impairment charges of real estate related investments, plus real estate related depreciation and amortization, and after adjustments for unconsolidated partnerships and joint ventures. In particular, we believe it is appropriate to disregard impairment charges, as this is a fair value adjustment that is largely based on market fluctuations and assessments regarding general market conditions which can change over time. An asset will only be evaluated for impairment if certain impairment indications exist and if the carrying, or book value, exceeds the total estimated undiscounted future cash flows (including net rental and lease revenues, net proceeds on the sale of the property, and any other ancillary cash flows at a property or group level under GAAP) from such asset. Investors should note, however, that determinations of whether impairment charges have been incurred are based partly on anticipated operating performance, because estimated undiscounted future cash flows from a property, including estimated future net rental and lease revenues, net proceeds on the sale of the property, and certain other ancillary cash flows, are taken into account in determining whether an impairment charge has been incurred. While impairment charges are excluded from the calculation of FFO as described above, investors are cautioned that due to the fact that impairments are based on estimated future undiscounted cash flows and the relatively limited term of our operations, it could be difficult to recover any impairment charges. Our FFO calculation complies with NAREIT’s policy described above.

The historical accounting convention used for real estate assets requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably over time, especially if such assets are not adequately maintained or repaired and renovated as required by relevant circumstances and/or as requested or required by lessees for operational purposes in order to maintain the value disclosed. We believe that since real estate values historically rise and fall with market conditions, including inflation, interest rates, the business cycle, unemployment and consumer spending, presentations of operating results for a REIT using historical accounting for depreciation may be less informative. Historical accounting for real estate involves the use of GAAP. Any other method of accounting for real estate such as the fair value method cannot be construed to be any more accurate or relevant than the comparable methodologies of real estate valuation found in GAAP. Nevertheless, we believe that the use of FFO, which excludes the impact of real estate related depreciation and

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PART I — FINANCIAL INFORMATION (continued)

amortization, provides a more complete understanding of our performance to investors and to management, and when compared year over year, reflects the impact on our operations from trends in occupancy rates, rental rates, operating costs, general and administrative expenses, and interest costs, which may not be immediately apparent from net income. We adopted ASU 2016-02, Leases, or ASU 2016-02 on January 1, 2019, which requires us, as a lessee, to recognize a liability for obligations under a lease contract and a right-of-use asset. The carrying amount of the right-of-use asset is amortized over the term of the lease. Because we have no ownership rights (current or residual) in the underlying asset, NAREIT concluded that the amortization of the right-of-use asset should not be added back to GAAP net income (loss) in calculating FFO. This amortization expense is included in FFO. However, FFO, and MFFO as described below, should not be construed to be more relevant or accurate than the current GAAP methodology in calculating net income or in its applicability in evaluating our operating performance. The method utilized to evaluate the value and performance of real estate under GAAP should be construed as a more relevant measure of operational performance and considered more prominently than the non-GAAP FFO and MFFO measures and the adjustments to GAAP in calculating FFO and MFFO.

Changes in the accounting and reporting promulgations under GAAP (for acquisition fees and expenses from a capitalization/depreciation model to an expensed-as-incurred model) that were put into effect in 2009 and other changes to GAAP accounting for real estate subsequent to the establishment of NAREIT’s definition of FFO have prompted an increase in cash-settled expenses, specifically acquisition fees and expenses for all industries as items that are expensed under GAAP, that are typically accounted for as operating expenses. Management believes these fees and expenses do not affect our overall long-term operating performance. Publicly registered, non-listed REITs typically have a significant amount of acquisition activity and are substantially more dynamic during their initial years of investment and operation. While other start-up entities may also experience significant acquisition activity during their initial years, we believe that public, non-listed REITs, like us, are unique in that they have a limited life with targeted exit strategies within a relatively limited time frame after acquisition activity ceases. Our board of directors will determine to pursue a liquidity event when it believes that the then-current market conditions are favorable. However, our board of directors does not anticipate evaluating a liquidity event (i.e., listing of our common stock on a national exchange, a merger or sale of our company or another similar transaction) until five years after the completion of our offering stage. Thus, as a limited life REIT, we will not continuously purchase assets and will have a limited life.

Due to the above factors and other unique features of publicly registered, non-listed REITs, the IPA, an industry trade group, has standardized a measure known as MFFO, which the IPA has recommended as a supplemental measure for publicly registered non-listed REITs and which we believe to be another appropriate supplemental measure to reflect the operating performance of a public, non-listed REIT having the characteristics described above. MFFO is not equivalent to our net income or loss as determined under GAAP, and MFFO may not be a useful measure of the impact of long-term operating performance on value if we do not continue to operate with a limited life and targeted exit strategy, as currently intended. We believe that, because MFFO excludes costs that we consider more reflective of investing activities and other non-operating items included in FFO and also excludes acquisition fees and expenses that are not capitalized, as discussed below, and affect our operations only in periods in which properties are acquired, MFFO can provide, on a going forward basis, an indication of the sustainability (that is, the capacity to continue to be maintained) of our operating performance after the period in which we are acquiring our properties and once our portfolio is in place. By providing MFFO, we believe we are presenting useful information that assists investors and analysts to better assess the sustainability of our operating performance after our offering has been completed and our properties have been acquired. We also believe that MFFO is a recognized measure of sustainable operating performance by the non-listed REIT industry. Further, we believe MFFO is useful in comparing the sustainability of our operating performance after our offering and acquisitions are completed with the sustainability of the operating performance of other real estate companies that are not as involved in acquisition activities. Investors are cautioned that MFFO should only be used to assess the sustainability of our operating performance after our offering has been completed and properties have been acquired, as it excludes acquisition costs that have a negative effect on our operating performance during the periods in which properties are acquired.

We define MFFO, a non-GAAP financial measure, consistent with the IPA’s Guideline 2010-01, Supplemental Performance Measure for Publicly Registered, Non-Listed REITs: Modified Funds from Operations, or the Practice Guideline, issued by the IPA in November 2010. The Practice Guideline defines MFFO as FFO further adjusted for the following items, as applicable, included in the determination of GAAP net income: acquisition fees and expenses; amounts relating to deferred rent receivables and amortization of above and below market leases and liabilities (which are adjusted in order to reflect such payments from a GAAP accrual basis to a cash basis of disclosing the rent and lease payments); accretion of discounts and amortization of premiums on debt investments; mark-to-market adjustments included in net income; nonrecurring gains or losses included in net income from the extinguishment or sale of debt, hedges, foreign exchange, derivatives or securities holdings where trading of such holdings is not a fundamental attribute of the business plan, unrealized gains or losses resulting from consolidation from, or deconsolidation to, equity accounting, and after adjustments for consolidated and unconsolidated partnerships and joint ventures, with such adjustments calculated to reflect MFFO on the same basis. The accretion of discounts and amortization of

43

PART I — FINANCIAL INFORMATION (continued)

premiums on debt investments, nonrecurring unrealized gains and losses on hedges, foreign exchange, derivatives or securities holdings, unrealized gains and losses resulting from consolidations, as well as other listed cash flow adjustments are adjustments made to net income in calculating the cash flows provided by operating activities and, in some cases, reflect gains or losses which are unrealized and may not ultimately be realized. While we rely on our advisor for managing interest rate, hedge and foreign exchange risk, we do not retain an outside consultant to review all our hedging agreements. Inasmuch as interest rate hedges are not a fundamental part of our operations, we believe it is appropriate to exclude such non-recurring gains and losses in calculating MFFO, as such gains and losses are not reflective of on-going operations.

Our MFFO calculation complies with the IPA’s Practice Guideline described above, except with respect to certain acquisition fees and expenses as discussed below. In calculating MFFO, we exclude acquisition related expenses, amortization of above and below market leases, fair value adjustments of derivative financial instruments, deferred rent receivables and the adjustments of such items related to noncontrolling interests. Historically, under GAAP, acquisition fees and expenses were characterized as operating expenses in determining operating net income. However, following the recent publication of ASU 2017-01, Business Combinations (Topic 805): Clarifying the definition of business (“ASU 2017-01”), acquisition fees and expenses are capitalized and depreciated under certain conditions. We elected to early adopt ASU 2017-01 but did not experience a material impact from adopting this guidance. These expenses are paid in cash by us. All paid and accrued acquisition fees and expenses will have negative effects on returns to investors, the potential for future distributions, and cash flows generated by us, unless earnings from operations or net sales proceeds from the disposition of other properties are generated to cover the purchase price of the property, these fees and expenses and other costs related to such property. The acquisition of properties, and the corresponding acquisition fees and expenses, is the key operational feature of our business plan to generate operational income and cash flow to fund distributions to its stockholders. Further, under GAAP, certain contemplated non-cash fair value and other non-cash adjustments are considered operating non-cash adjustments to net income in determining cash flow from operating activities. In addition, we view fair value adjustments of derivatives and gains and losses from dispositions of assets as non-recurring items or items which are unrealized and may not ultimately be realized, and which are not reflective of on-going operations and are therefore typically adjusted for when assessing operating performance.

Our management uses MFFO and the adjustments used to calculate MFFO in order to evaluate our performance against other public, non-listed REITs which have limited lives with short and defined acquisition periods and targeted exit strategies shortly thereafter. As noted above, MFFO may not be a useful measure of the impact of long-term operating performance on value if we do not continue to operate in this manner. We believe that our use of MFFO and the adjustments used to calculate MFFO allow us to present our performance in a manner that reflects certain characteristics that are unique to public, non-listed REITs, such as their limited life, limited and defined acquisition period and targeted exit strategy, and hence that the use of such measures is useful to investors. By excluding expensed acquisition costs, that are not capitalized, the use of MFFO provides information consistent with management’s analysis of the operating performance of the properties. Additionally, fair value adjustments, which are based on the impact of current market fluctuations and underlying assessments of general market conditions, but can also result from operational factors such as rental and occupancy rates, may not be directly related or attributable to our current operating performance. By excluding such changes that may reflect anticipated and unrealized gains or losses, we believe MFFO provides useful supplemental information.

Presentation of this information is intended to provide useful information to investors as they compare the operating performance to that of other public, non-listed REITs, although it should be noted that not all public, non-listed REITs calculate FFO and MFFO the same way, so comparisons with other public, non-listed REITs may not be meaningful. Furthermore, FFO and MFFO are not necessarily indicative of cash flow available to fund cash needs and should not be considered as an alternative to net income (loss) or income (loss) from continuing operations as an indication of our performance, as an alternative to cash flows from operations as an indication of our liquidity, or indicative of funds available to fund our cash needs, including our ability to make distributions to our stockholders. FFO and MFFO should be reviewed in conjunction with GAAP measurements as an indication of our performance. MFFO is useful in assisting management and investors in assessing the sustainability of operating performance in future operating periods, and in particular, after the offering and acquisition stages are complete and net asset value is disclosed. MFFO is not a useful measure in evaluating net asset value because impairments are taken into account in determining net asset value but not in determining MFFO.

Neither the SEC, NAREIT nor any other regulatory body has passed judgment on the acceptability of the adjustments that we use to calculate FFO or MFFO. In the future, the SEC, NAREIT or another regulatory body may decide to standardize the allowable adjustments across the non-listed REIT industry and in response to such standardization we may have to adjust our calculation and characterization of FFO or MFFO accordingly.

44

PART I — FINANCIAL INFORMATION (continued)

Our calculation of FFO and MFFO is presented in the following table for the three months endedMarch 31, 2019 and 2018:

	For the Three Months Ended March 31,
	2019			2018
Reconciliation of net loss to MFFO:
Net loss	$	(12,359,272	)	$	(8,018,094	)
Depreciation of real estate assets	18,282,293			17,435,350
FFO	5,923,021			9,417,256
Acquisition fees and expenses (1)(2)	358,757			—
Unrealized loss (gain) on derivative instruments	179,616			(447,614		)
Loss on debt extinguishment	41,609			—
MFFO	$	6,503,003		$	8,969,642

________________

(1) By excluding expensed acquisition costs that are not capitalized, management believes MFFO provides useful supplemental information that is comparable for each type of real estate investment and is consistent with management’s analysis of the investing and operating performance of our properties. Acquisition fees and expenses include payments to our advisor or third parties. Historically, under GAAP, acquisition fees and expenses were considered operating expenses and as expenses included in the determination of net income (loss) and income (loss) from continuing operations, both of which are performance measures under GAAP. Following the publication of ASU 2017-01, acquisition fees and expenses are capitalized and depreciated under certain conditions. We elected to early adopt ASU 2017-01 but did not experience a material impact from adopting this new guidance. All paid and accrued acquisition fees and expenses will have negative effects on returns to investors, the potential for future distributions, and cash flows generated by us, unless earnings from operations or net sales proceeds from the disposition of properties are generated to cover the purchase price of the property, these fees and expenses and other costs related to the property. The acquisition of properties, and the corresponding acquisition fees and expenses, is the key operational feature of our business plan to generate operational income and cash flow to fund distributions to its stockholders.

(2) Acquisition fees and expenses for the three months endedMarch 31, 2019 and 2018 include acquisition expenses of $358,757 and $0, respectively, that did not meet the criteria for capitalization under ASU 2017-01 and are recorded in general and administrative expenses.

FFO and MFFO may be used to fund all or a portion of certain capitalizable items that are excluded from FFO and MFFO, such as tenant improvements, building improvements and deferred leasing costs.

Off-Balance Sheet Arrangements

As of March 31, 2019, we had no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Related-Party Transactions and Agreements

We have entered into agreements with our advisor and its affiliates, whereby we pay certain fees to, or reimburse certain expenses of, our advisor or its affiliates for acquisition and advisory fees and expenses, financing coordination fees, organization and offering costs, sales commissions, dealer manager fees, asset and property management fees and expenses, leasing fees and reimbursement of certain operating costs. Refer to Note 7 (Related Party Arrangements) to the unaudited consolidated financial statements included in this quarterly report for a discussion of the various related-party transactions, agreements and fees.

45

PART I — FINANCIAL INFORMATION (continued)

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We may be exposed to the effects of interest rate changes as a result of borrowings used to maintain liquidity and to fund the acquisition, expansion and refinancing of our real estate investment portfolio and operations. We may be also exposed to the effects of changes in interest rates as a result of the acquisition and origination of mortgage, mezzanine, bridge and other loans. Our profitability and the value of our investment portfolio may be adversely affected during any period as a result of interest rate changes. Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings, prepayment penalties and cash flows and to lower overall borrowing costs. We have managed and will continue to manage interest rate risk by maintaining a ratio of fixed rate, long-term debt such that floating rate exposure is kept at an acceptable level. In addition, we may utilize a variety of financial instruments, including interest rate caps, collars, floors and swap agreements, in order to limit the effects of changes in interest rates on our operations. When we use these types of derivatives to hedge the risk of interest-earning assets or interest-bearing liabilities, we may be subject to certain risks, including the risk that losses on a hedge position will reduce the funds available for distributions to holders of our common stock and that the losses may exceed the amount we invested in the instruments.

We borrow funds and make investments at a combination of fixed and variable rates. Interest rate fluctuations will generally not affect our future earnings or cash flows on our fixed rate debt unless such instruments mature or are otherwise terminated. However, interest rate changes will affect the fair value of our fixed rate instruments. At March 31, 2019, the fair value of our fixed rate debt was $716,100,257 and the carrying value of our fixed rate debt was $692,205,760. The fair value estimate of our fixed rate debt was estimated using a discounted cash flow analysis utilizing rates we would expect to pay for debt of a similar type and remaining maturity if the loans were originated at March 31, 2019. As we expect to hold our fixed rate instruments to maturity and the amounts due under such instruments would be limited to the outstanding principal balance and any accrued and unpaid interest, we do not expect that fluctuations in interest rates, and the resulting change in fair value of our fixed rate instruments, would have a significant impact on our operations.

Conversely, movements in interest rates on our variable rate debt will change our future earnings and cash flows, but not significantly affect the fair value of those instruments. However, changes in required risk premiums will result in changes in the fair value of floating rate instruments. As of March 31, 2019, the fair value of our variable rate debt was $355,695,372 and the carrying value of our variable rate debt was $357,994,907. Based on interest rates as of March 31, 2019, if interest rates are 100 basis points higher during the 12 months ending March 31, 2020, interest expense on our variable rate debt would increase by $3,651,848 and if interest rates are 100 basis points lower during the 12 months ending March 31, 2020, interest expense on our variable rate debt would decrease by $3,651,848.

As of March 31, 2019, the weighted-average interest rate of our fixed rate debt and variable rate debt was 4.47% and 4.43%, respectively. The weighted-average interest rate of our blended fixed and variable rates was 4.45% as of March 31, 2019. The weighted-average interest rate represents the actual interest rate in effect at March 31, 2019 (consisting of the contractual interest rate), using interest rate indices as of March 31, 2019, where applicable.

We may also be exposed to credit risk. Credit risk is the failure of the counterparty to perform under the terms of the derivative contract. If the fair value of a derivative contract is positive, the counterparty will owe us, which creates credit risk for us. If the fair value of a derivative contract is negative, we will owe the counterparty and, therefore, do not have credit risk. We will seek to minimize the credit risk in derivative instruments by entering into transactions with high-quality counterparties. As of March 31, 2019, we did not have counterparty risk on our interest rate cap agreements as the underlying variable rates for each of our interest rate cap agreements as of March 31, 2019 were not in excess of the capped rates. See also Note 10 (Derivative Financial Instruments) to our unaudited consolidated financial statements included in this quarterly report.

Item 4. Controls and Procedures

Disclosure Controls and Procedures

We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms, and that such information is accumulated and communicated to us, including our chief executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, we recognize that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, as ours are designed to do, and we necessarily are required to apply our judgment in evaluating whether the benefits of the controls and procedures that we adopt outweigh their costs.

46

PART I — FINANCIAL INFORMATION (continued)

As required by Rules 13a-15(b) and 15d-15(b) of the Exchange Act, an evaluation as of March 31, 2019, was conducted under the supervision and with the participation of our management, including our chief executive officer and principal financial officer, of the effectiveness of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act). Based on this evaluation, our chief executive officer and principal financial officer concluded that our disclosure controls and procedures, as of March 31, 2019, were effective at the reasonable assurance level.

Internal Control Over Financial Reporting

There have been no changes in our internal control over financial reporting that occurred during the quarter ended March 31, 2019 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

47

PART II — OTHER INFORMATION

PART II

Item 1. Legal Proceedings

From time to time, we are party to legal proceedings that arise in the ordinary course of our business. Management is not aware of any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on our results of operations or financial condition, nor are we aware of any such legal proceedings contemplated by government agencies.

Item 1A. Risk Factors

There have been no material changes to the risk factors contained in Part I, Item 1A set forth in our Annual Report on Form 10-K filed with the SEC on March 14, 2019.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds

During the three months ended March 31, 2019, we did not sell any equity securities that were not registered under the Securities Act of 1933, or the Securities Act.

During the three months ended March 31, 2019, we fulfilled repurchase requests and repurchased shares of our common stock pursuant to our share repurchase plan as follows:

	Total Number of Shares Requested to be Repurchased(1)	Total Number of Shares Repurchased	Average Price Paid per Share(2)(3)		Approximate Dollar Value of Shares Available That May Yet Be Repurchased Under the Program
January 2019	142,184	138,961	$	14.39	(4)
February 2019	151,987	—	—		(4)
March 2019	146,737	—	—		(4)
	440,908	138,961

____________________

(1) We generally repurchase shares approximately 30 days following the end of the applicable quarter in which requests were received. At March 31, 2019, we had $2,000,000, representing 135,886 shares of outstanding and unfulfilled repurchase requests, all of which were fulfilled on May 1, 2019.

(2) We currently repurchase shares at prices determined as follows:

• 92.5% of the Share Repurchase Price for stockholders who have held their shares for at least one year;

• 95.0% of the Share Repurchase Price for stockholders who have held their shares for at least two years;

• 97.5% of the Share Repurchase Price for stockholders who have held their shares for at least three years; and

• 100% of the Share Repurchase Price for stockholders who have held their shares for at least four years.

The share repurchase price is 93% of the most recently determined estimated value per share. Notwithstanding the above, the repurchase price for repurchases sought upon a stockholder’s death, “qualifying disability” or “determination of incompetence” will be the amount the respective stockholder paid to acquire the shares from us.

(3) From inception through March 31, 2019, our share repurchases have been funded exclusively from the net proceeds we received from the sale of shares under our distribution reinvestment plan.

(4) The number of shares that may be repurchased pursuant to the share repurchase plan during any calendar year is limited to the lesser of (1) 5% of the weighted-average number of shares outstanding during the prior calendar year or the $2,000,000 limit for any quarter and (2) those that can be funded from net proceeds we received from the sale of shares

48

PART II — OTHER INFORMATION (continued)

under the distribution reinvestment plan during the prior calendar year, plus such additional funds as may be reserved for that purpose by our board of directors.

Item 3. Defaults Upon Senior Securities

None.

Item4.  Mine Safety Disclosures

Not applicable.

Item5.  Other Information

None.

49

PART II — OTHER INFORMATION (continued)

Item 6.Exhibits

EXHIBIT LIST

Exhibit	Description
3.1	Articles of Amendment and Restatement of Steadfast Apartment REIT, Inc. (incorporated by reference to Exhibit 3.1 to Pre-Effective Amendment No. 3 to the Registrant’s Registration Statement on Form S-11, filed December 16, 2013, Commission File No. 333-191049)
3.2	Bylaws of Steadfast Apartment REIT, Inc. (incorporated by reference to Exhibit 3.2 to the Registrant’s Registration Statement on Form S-11, filed September 6, 2013, Commission File No. 333-191049)
4.1	Form of Distribution Reinvestment Plan (incorporated by reference to Appendix C to the prospectus, dated April 15, 2015, of the Registrant)
4.2	Form of Redemption Request Form (incorporated by reference to Appendix D to the prospectus, dated April 15, 2015, of the Registrant)
4.3	Form of Application for Transfer (incorporated by reference to Appendix E to the prospectus, dated April 15, 2015, of the Registrant)
4.5	Amended and Restated Distribution Reinvestment Plan (incorporated by reference to Exhibit 4.1 to Post-Effective Amendment No. 12 to Form S-11 on Form S-3, filed April 5, 2016, Commission File No. 333-191049)
4.6	Account Update Form (incorporated by reference to Appendix A to Post-Effective Amendment No. 12 to Form S-11 on Form S-3, filed April 5, 2016, Commission File No. 333-191049)
31.1*	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2*	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1**	Certification of Principal Executive Officer pursuant to 18 U.S.C. 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002
32.2**	Certification of Principal Financial Officer pursuant to 18 U.S.C. 1350, as created by Section 906 of the Sarbanes-Oxley Act of 2002

____________________________

*

Filed herewith

**

In accordance with Item 601(b)(32) of Regulation S-K, this Exhibit is not deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section. Such certifications will not be deemed incorporated by reference into any filing under the Securities Act or the Exchange Act, except to the extent that the registrant specifically incorporates it by reference.

50

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

		Steadfast Apartment REIT, Inc.
Date:	May 10, 2019	By:	/s/ Rodney F. Emery
			Rodney F. Emery
			Chief Executive Officer and Chairman of the Board
			(Principal Executive Officer)
Date:	May 10, 2019	By:	/s/ Kevin J. Keating
			Kevin J. Keating
			Chief Financial Officer and Treasurer
			(Principal Financial and Accounting Officer)

51

EX-31.1

EXHIBIT 31.1

Certification of Principal Executive Officer Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Rodney F. Emery, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Steadfast Apartment REIT, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 10, 2019

By:	/s/ Rodney F. Emery
	Rodney F. Emery
	Chief Executive Officer and Chairman of the Board (Principal Executive Officer)

EX-31.2

EXHIBIT 31.2

Certification of Principal Financial and Accounting Officer Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Kevin J. Keating, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Steadfast Apartment REIT, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: May 10, 2019

By:	/s/ Kevin J. Keating
	Kevin J. Keating
	Chief Financial Officer (Principal Financial and Accounting Officer)

EX-32.1

EXHIBIT 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002

     Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and in connection with the Quarterly Report on Form 10-Q of Steadfast Apartment REIT, Inc. (the “Company”) for the period ended March 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, the Principal Executive Officer of the Company, certifies, to his knowledge, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 10, 2019

By:	/s/ Rodney F. Emery
	Rodney F. Emery
	Chief Executive Officer and Chairman of the Board (Principal Executive Officer)

EX-32.2

EXHIBIT 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO SECTION 906 OF THE

SARBANES-OXLEY ACT OF 2002

     Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and in connection with the Quarterly Report on Form 10-Q of Steadfast Apartment REIT, Inc. (the “Company”) for the period ended March 31, 2019, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), the undersigned, the Principal Financial and Accounting Officer of the Company, certifies, to his knowledge, that:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: May 10, 2019

By:	/s/ Kevin J. Keating
	Kevin J. Keating
	Chief Financial Officer (Principal Financial and Accounting Officer)

XML

Document and Entity Information - shares	3 Months Ended
	Mar. 31, 2019	May 03, 2019
Document and Entity Information
Entity Registrant Name	Steadfast Apartment REIT, Inc.
Entity Central Index Key	0001585219
Document Type	10-Q
Document Period End Date	Mar. 31, 2019
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Non-accelerated Filer
Entity Common Stock, Shares Outstanding		52,028,735
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q1

XML

CONSOLIDATED BALANCE SHEETS - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Real Estate:
Land	$ 164,113,072	$ 164,113,072
Building and improvements	1,414,902,453	1,411,198,832
Total real estate, cost	1,579,015,525	1,575,311,904
Less accumulated depreciation and amortization	(236,954,186)	(218,672,162)
Total real estate, net	1,342,061,339	1,356,639,742
Cash and cash equivalents	52,802,102	58,880,007
Restricted cash	8,470,593	13,858,768
Rents and other receivables	1,707,753	1,836,406
Other assets	3,410,255	2,923,725
Total assets	1,408,452,042	1,434,138,648
Liabilities:
Accounts payable and accrued liabilities	26,709,603	32,330,278
Mortgage notes payable, net	502,044,479	502,143,306
Credit facilities, net	548,156,188	548,012,437
Total notes payable, net	1,050,200,667	1,050,155,743
Distributions payable	3,970,014	3,953,499
Due to affiliates	2,062,145	1,711,168
Total liabilities	1,082,942,429	1,088,150,688
Commitments and contingencies (Note 9)
Stockholders’ Equity:
Preferred stock, $0.01 par value per share; 100,000,000 shares authorized, no shares issued and outstanding	0	0
Additional paid-in capital	687,531,131	684,140,823
Cumulative distributions and net losses	(362,540,920)	(338,670,111)
Total stockholders’ equity	325,509,613	345,987,960
Total liabilities and stockholders’ equity	1,408,452,042	1,434,138,648
Common stock, $0.01 par value per share; 999,999,000 shares authorized, 51,939,159 and 51,723,801 shares issued and outstanding at March 31, 2019 and December 31, 2018, respectively
Liabilities:
Distributions payable	3,970,014	3,953,499
Stockholders’ Equity:
Common stock	519,392	517,238
Convertible stock, $0.01 par value per share; 1,000 shares authorized, issued and outstanding as of March 31, 2019 and December 31, 2018, respectively
Stockholders’ Equity:
Common stock	$ 10	$ 10

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	100,000,000	100,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common Stock [Member]
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	999,999,000	999,999,000
Common stock, shares issued (in shares)	51,939,159	51,723,801
Common stock, shares outstanding (in shares)	51,939,159	51,723,801
Convertible Stock [Member]
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	1,000	1,000
Common stock, shares issued (in shares)	1,000	1,000
Common stock, shares outstanding (in shares)	1,000	1,000

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CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Revenues:
Rental income	$ 42,316,920	$ 40,727,392
Tenant reimbursements and other	449,690	639,634
Total revenues	42,766,610	41,367,026
Expenses:
Operating, maintenance and management	10,041,264	9,974,835
Real estate taxes and insurance	6,581,189	5,685,380
Fees to affiliates	6,065,648	5,796,678
Depreciation and amortization	18,282,293	17,435,350
Interest expense	12,233,295	9,114,355
Loss on debt extinguishment	41,609	0
General and administrative expenses	1,880,584	1,378,522
Total expenses	55,125,882	49,385,120
Net loss	$ (12,359,272)	$ (8,018,094)
Loss per common share - basic and diluted (in dollars per share)	$ (0.24)	$ (0.16)
Weighted average number of common shares outstanding - basic and diluted (in shares)	51,873,832	50,976,133

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CONSOLIDATED STATEMENT OF STOCKHOLDERS' EQUITY - USD ($)	Total	Common Stock [Member]	Stock [Member] Common Stock [Member]	Stock [Member] Convertible Stock [Member]	Additional Paid-in Capital [Member]	Cumulative Distributions & Net Losses [Member]
BALANCE, beginning of period at Dec. 31, 2017	$ 390,305,183		$ 508,426	$ 10	$ 633,186,743	$ (243,389,996)
BALANCE, beginning of period (in shares) at Dec. 31, 2017			50,842,640	1,000
Increase (decrease) in Stockholders' Equity
Issuance of common stock	5,701,030		$ 3,840		5,697,190
Issuance of common stock (in shares)			383,906
Transfers From (To) Redeemable Common Stock	37,028,102				37,028,102
Redemption of common stock	(2,886,216)		$ (2,022)		(2,884,194)
Redemption of common stock (in shares)			(202,172)
Distributions declared	(11,312,463)	$ (11,312,463)				(11,312,463)
Amortization of stock-based compensation	13,839				13,839
Net loss for period	(8,018,094)					(8,018,094)
BALANCE, end of period at Mar. 31, 2018	410,831,381		$ 510,244	$ 10	673,041,680	(262,720,553)
BALANCE, end of period (in shares) at Mar. 31, 2018			51,024,374	1,000
BALANCE, beginning of period at Dec. 31, 2018	345,987,960		$ 517,238	$ 10	684,140,823	(338,670,111)
BALANCE, beginning of period (in shares) at Dec. 31, 2018			51,723,801	1,000
Increase (decrease) in Stockholders' Equity
Issuance of common stock	5,378,566		$ 3,544		5,375,022
Issuance of common stock (in shares)			354,319
Redemption of common stock	(2,000,000)		$ (1,390)		(1,998,610)
Redemption of common stock (in shares)			(138,961)
Distributions declared	(11,511,537)	$ (11,511,537)				(11,511,537)
Amortization of stock-based compensation	13,896				13,896
Net loss for period	(12,359,272)					(12,359,272)
BALANCE, end of period at Mar. 31, 2019	$ 325,509,613		$ 519,392	$ 10	$ 687,531,131	$ (362,540,920)
BALANCE, end of period (in shares) at Mar. 31, 2019			51,939,159	1,000

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Cash Flows from Operating Activities:
Net loss	$ (12,359,272)	$ (8,018,094)
Adjustments to reconcile net loss to net cash provided by operating activities:
Depreciation and amortization	18,282,293	17,435,350
Loss on disposal of buildings and improvements	2,198	180,041
Amortization of deferred financing costs	247,773	246,274
Amortization of stock-based compensation	13,896	13,839
Change in fair value of interest rate cap agreements	179,616	(447,614)
Amortization of loan discount	0	88,746
Loss on debt extinguishment	41,609	0
Insurance claim recoveries	(10,092)	(143,972)
Changes in operating assets and liabilities:
Rents and other receivables	53,653	(763,375)
Other assets	540,887	534,681
Accounts payable and accrued liabilities	(5,117,094)	(1,525,012)
Due to affiliates	400,596	(513,838)
Net cash provided by operating activities	2,276,063	7,087,026
Cash Flows from Investing Activities:
Additions to real estate investments	(4,210,470)	(3,466,412)
Escrow deposits for pending real estate acquisitions	(1,200,200)	0
Proceeds from insurance claims	85,092	143,972
Net cash used in investing activities	(5,325,578)	(3,322,440)
Cash Flows from Financing Activities:
Principal payments on mortgage notes payable	(244,458)	(101,943)
Payments of commissions on sale of common stock	(55,651)	(56,510)
Distributions to common stockholders	(6,116,456)	(5,597,521)
Repurchase of common stock	(2,000,000)	(2,886,216)
Net cash used in financing activities	(8,416,565)	(8,642,190)
Net decrease in cash, cash equivalents and restricted cash	(11,466,080)	(4,877,604)
Cash, cash equivalents and restricted cash, beginning of the period	72,738,775	38,667,705
Cash, cash equivalents and restricted cash, end of the period	61,272,695	33,790,101
Supplemental Disclosures of Cash Flow Information:
Interest paid	11,762,392	8,705,963
Supplemental Disclosures of Noncash Flow Transactions:
Distributions payable	3,970,014	3,900,642
Distributions paid to common stockholders through common stock issuances pursuant to the distribution reinvestment plan	5,378,566	5,701,030
Redemptions payable	2,000,000	2,000,000
Accounts payable and accrued liabilities from additions to real estate investments	327,788	1,718,324
Due to affiliates from additions to real estate investments	47,123	176,902
Due to affiliates for commissions on sale of common stock	244,300	$ 505,829
Operating lease right-of-use asset, net	6,768
Operating lease liabilities, net	$ 6,833

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Organization and Business

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Organization and Business

Organization and Business

Steadfast Apartment REIT, Inc. (the “Company”) was formed on August 22, 2013, as a Maryland corporation that elected to qualify as a real estate investment trust (“REIT”) commencing with the taxable year ended December 31, 2014. On September 3, 2013, the Company was initially capitalized with the sale of 13,500 shares of common stock to Steadfast REIT Investments, LLC (the “Sponsor”) at a purchase price of $15.00 per share for an aggregate purchase price of $202,500. Steadfast Apartment Advisor, LLC (the “Advisor”), a Delaware limited liability company formed on August 22, 2013, invested $1,000 in the Company in exchange for 1,000 shares of non-participating, non-voting convertible stock (the “Convertible Stock”) as described in Note 6 (Stockholders’ Equity).

The Company owns and operates a diverse portfolio of multifamily properties located in targeted markets throughout the United States. As of March 31, 2019, the Company owned 34 multifamily properties comprising a total of 11,601 apartment homes. The Company may acquire additional multifamily properties or pursue multifamily developments in the future. For more information on the Company’s real estate portfolio, see Note 3 (Real Estate).

Public Offering

On December 30, 2013, the Company commenced its initial public offering to offer a maximum of 66,666,667 shares of common stock for sale to the public at an initial price of $15.00 per share (with discounts available for certain categories of purchasers) (the “Primary Offering”). The Company also registered up to 7,017,544 shares of common stock for sale pursuant to the Company’s distribution reinvestment plan (the “DRP,” and together with the Primary Offering, the “Public Offering”) at an initial price of $14.25 per share. The Company terminated its Public Offering on March 24, 2016, but continues to offer shares of common stock pursuant to the DRP. As of the termination of the Public Offering, the Company had sold 48,625,651 shares of common stock in the Public Offering for gross proceeds of $724,849,631, including 1,011,561 shares of common stock issued pursuant to the DRP for gross offering proceeds of $14,414,752. As of March 31, 2019, the Company had issued 53,275,989 shares of common stock for gross offering proceeds of $793,718,541, including 5,661,962 shares of common stock issued pursuant to the DRP for gross offering proceeds of $83,283,662.

On March 12, 2019, the Company’s board of directors determined an estimated value per share of the Company’s common stock of $15.84 as of December 31, 2018. In connection with the determination of an estimated value per share, the Company’s board of directors determined a price per share for the DRP of $15.84, effective April 1, 2019. The Company’s board of directors may again, from time to time, in its sole discretion, change the price at which the Company offers shares pursuant to the DRP to reflect changes in the Company’s estimated value per share and other factors that the Company’s board of directors deems relevant. 

The business of the Company is externally managed by the Advisor, pursuant to the Advisory Agreement dated December 13, 2013, by and among the Company, Steadfast Apartment REIT Operating Partnership, L.P. (the “Operating Partnership”) and the Advisor (as amended, the “Advisory Agreement”). The Advisory Agreement is subject to annual renewal by the Company’s board of directors. The current term of the Advisory Agreement expires on December 13, 2019. Subject to certain restrictions and limitations, the Advisor manages the Company’s day-to-day operations, manages the Company’s portfolio of properties, sources and presents investment opportunities to the Company’s board of directors and provides investment management services on the Company’s behalf. The Advisor has also entered into an Advisory Services Agreement with Crossroads Capital Advisors, LLC (“Crossroads Capital Advisors”), whereby Crossroads Capital Advisors provides certain advisory services to the Company on behalf of the Advisor. The Company retained Stira Capital Markets Group, LLC (formerly known as Steadfast Capital Markets Group, LLC) (the “Dealer Manager”), an affiliate of the Sponsor, to serve as the dealer manager for the Public Offering. The Dealer Manager was responsible for marketing the Company’s shares of common stock offered pursuant to the Public Offering. The Advisor, along with the Dealer Manager, provides marketing, investor relations and other administrative services on the Company’s behalf.

Substantially all of the Company’s business is conducted through the Operating Partnership. The Company is the sole general partner of the Operating Partnership. The Company and Steadfast Apartment REIT Limited Partner, LLC, a Delaware limited liability company and a wholly-owned subsidiary of the Company, entered into a Limited Partnership Agreement (the “Partnership Agreement”) on September 3, 2013.

As the Company accepted subscriptions for shares of its common stock, the Company transferred substantially all of the net offering proceeds from its Public Offering to the Operating Partnership as a contribution in exchange for partnership interests and the Company’s percentage ownership in the Operating Partnership increased proportionately. The Partnership Agreement provides that the Operating Partnership is operated in a manner that will enable the Company to (1) satisfy the requirements for being classified as a REIT for tax purposes, (2) avoid any federal income or excise tax liability and (3) ensure that the Operating Partnership will not be classified as a “publicly traded partnership” for purposes of Section 7704 of the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), which classification could result in the Operating Partnership being taxed as a corporation. In addition to the administrative and operating costs and expenses incurred by the Operating Partnership in acquiring and operating real properties, the Operating Partnership pays all of the Company’s administrative costs and expenses, and such expenses are treated as expenses of the Operating Partnership.

The Company commenced its real estate operations on May 22, 2014, upon acquiring a fee simple interest in a multifamily property located in Spring Hill, Tennessee.

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Summary of Significant Accounting Policies

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

There have been no significant changes to the Company’s accounting policies since it filed its audited financial statements in its Annual Report on Form 10-K for the year ended December 31, 2018, other than Accounting Standards Update (“ASU”) 2016-02 and the Securities and Exchange Commission’s (“SEC”) Disclosure Update and Simplification rule (Release 33-10532), as further described below. For further information about the Company’s accounting policies, refer to the Company’s consolidated financial statements and notes thereto for the year ended December 31, 2018, included in the Company’s Annual Report on Form 10-K filed with the SEC on March 14, 2019. 

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company, the Operating Partnership and its subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation. The financial statements of the Company’s subsidiaries are prepared using accounting policies consistent with those of the Company.

The accompanying unaudited consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments that are of a normal and recurring nature and necessary for a fair and consistent presentation of the results of such periods. Operating results for the three months endedMarch 31, 2019, are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The unaudited consolidated financial statements herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Fair Value Measurements

Under GAAP, the Company is required to measure certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other assets and liabilities at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories:

• Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

• Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

• Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable.

When available, the Company utilizes quoted market prices from an independent third-party source to determine fair value and will classify such items in Level 1 or Level 2. In instances where the market is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for a financial instrument owned by the Company to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and will establish a fair value by assigning weights to the various valuation sources.

The following describes the valuation methodologies used by the Company to measure fair value, including an indication of the level in the fair value hierarchy in which each asset or liability is generally classified.

Interest rate cap agreements - The Company has entered into certain interest rate cap agreements. These derivatives are recorded at fair value. Fair value was based on a model-driven valuation using the associated variable rate curve and an implied market volatility, both of which were observable at commonly quoted intervals for the full term of the interest rate cap agreements. Therefore, the Company’s interest rate cap agreements were classified within Level 2 of the fair value hierarchy and are included in other assets in the accompanying consolidated balance sheets. Changes in the fair value of the interest rate cap agreements are recorded as interest expense in the accompanying consolidated statements of operations.

The following tables reflect the Company’s assets required to be measured at fair value on a recurring basis on the consolidated balance sheets:

	March 31, 2019
	Fair Value Measurements Using
	Level 1		Level 2		Level 3
Assets:
Interest rate cap agreements	$	—	$	28,153	$	—

	December 31, 2018
	Fair Value Measurements Using
	Level 1		Level 2		Level 3
Assets:
Interest rate cap agreements	$	—	$	207,769	$	—

Changes in assumptions or estimation methodologies can have a material effect on these estimated fair values. In this regard, the derived fair value estimates cannot be substantiated by comparison to independent markets and, in many cases, may not be realized in an immediate settlement of the instrument.

Fair Value of Financial Instruments

The accompanying consolidated balance sheets include the following financial instruments: cash and cash equivalents, restricted cash, rents and other receivables, accounts payable and accrued liabilities, distributions payable, due to affiliates and notes payable.

The Company considers the carrying value of cash and cash equivalents, restricted cash, rents and other receivables, accounts payable and accrued liabilities and distributions payable to approximate the fair value of these financial instruments based on the short duration between origination of the instruments and their expected realization. The fair value of amounts due to affiliates is not determinable due to the related party nature of such amounts. The Company has determined that its notes payable, net are classified as Level 3 within the fair value hierarchy.

The fair value of the notes payable, net is estimated using a discounted cash flow analysis using borrowing rates available to the Company for debt instruments with similar terms and maturities. As of March 31, 2019 and December 31, 2018, the fair value of the notes payable was $1,071,795,629 and $1,042,358,884, respectively, compared to the carrying value of $1,050,200,667 and $1,050,155,743, respectively.

Distribution Policy

The Company elected to be taxed, and currently qualifies, as a REIT commencing with the taxable year ended December 31, 2014. To maintain its qualification as a REIT, the Company intends to make distributions each taxable year equal to at least 90% of its REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). Distributions declared during the three months ended March 31, 2019, were based on daily record dates and calculated at a rate of $0.002466 per share per day during the period from January 1, 2019, through March 31, 2019. 

Distributions to stockholders are determined by the board of directors of the Company and are dependent upon a number of factors relating to the Company, including funds available for the payment of distributions, financial condition, the timing of property acquisitions, capital expenditure requirements and annual distribution requirements in order for the Company to qualify as a REIT under the Internal Revenue Code. During the three months endedMarch 31, 2019 and 2018, the Company declared distributions totaling $0.222 and $0.222 per share of common stock, respectively.

Per Share Data

Basic loss per share attributable to common stockholders for all periods presented are computed by dividing net loss by the weighted average number of shares of the Company’s common stock outstanding during the period. Diluted loss per share is computed based on the weighted average number of shares of the Company’s common stock and all potentially dilutive securities, if any. Distributions declared per common share assume each share was issued and outstanding each day during the period. Nonvested shares of the Company’s restricted common stock and convertible stock give rise to potentially dilutive shares of the Company’s common stock but such shares were excluded from the computation of diluted earnings per share because such shares were anti-dilutive during the period.

Segment Disclosure

The Company has determined that it has one reportable segment with activities related to investing in multifamily properties. The Company’s investments in real estate are in different geographic regions, and management evaluates operating performance on an individual asset level. However, as each of the Company’s assets has similar economic characteristics, tenants and products and services, its assets have been aggregated into one reportable segment.

Reclassifications

Certain amounts in the Company’s prior period consolidated financial statements were reclassified to conform to the current presentation. These reclassifications did not change the results of operations of those prior periods. On January 1, 2019, the Company adopted ASU 2016-02, as further described below. As a result, all income earned pursuant to tenant leases is reflected as one line, “Rental Income,” in the consolidated statements of operations. To facilitate comparability, the Company has reclassified prior period’s lease and non-lease income consistently with the current year.

The table below provides a reconciliation of the prior period presentation of the income statement line items that were reclassified in our consolidated statements of operations to conform to the current period presentation, pursuant to the adoption of the new lease accounting standard and election of the single component practical expedient:

	Three Months Ended March 31, 2018
Rental income (presentation prior to January 1, 2019)	$	36,800,334
Tenant reimbursements(1) (presentation prior to January 1, 2019)	3,927,058
Rental income (presentation effective January 1, 2019)	$	40,727,392

______________

(1) Tenant reimbursements include reimbursements for recoverable costs.

Recent Accounting Pronouncements

In February 2016, the FASB established ASC Topic 842, Leases (“ASC 842”), by issuing ASU 2016-02, which requires lessees to recognize right-of-use assets and lease liabilities for operating leases on the balance sheet and disclose key information about leasing arrangements. ASC 842 also makes targeted changes to lessor accounting. ASC 842 was subsequently amended by ASU 2018-01, Land Easement Practical Expedient for Transition to Topic 842 (“ASU 2018-01”), ASU 2018-10, Codification Improvements to Topic 842 (“ASU 2018-10”), ASU 2018-11, Targeted Improvements (ASU 2018-11”) and ASU 2018-20, Leases (Topic 842), Narrow-scope Improvements for Lessors (“ASU 2018-20”). ASC 842 requires a modified retrospective transition approach and was effective in the first quarter of 2019 and allowed for early adoption. The Company elected an optional transition method that allows entities to initially apply ASC 842 at the adoption date (January 1, 2019) and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company evaluated the impact of ASC 842 on its leases both as it relates to the Company acting as a lessee and as a lessor. Based on its evaluation, as it relates to the former, the Company elected to apply each of the practical expedients described in ASC 842-10-65-1(f) that allowed the Company, among other things, to not reassess lease classification conclusions or initial direct cost accounting as of December 31, 2018, therefore these leases continue to be accounted for as operating leases. The Company also elected the practical expedient described in ASC 842-20-25-2 not to apply the recognition requirements in ASC 842 to short-term leases and instead, to recognize lease payments in the consolidated statement of operations on a straight-line basis over the lease term. The Company did not experience a material impact on the recognition of leases in the consolidated financial statements because the quantity of leased equipment by the Company is limited and immaterial to the consolidated financial statements. Upon adoption, the Company recognized an initial operating lease right-of-use asset, net, of $7,656 and an operating lease liability, net, of $7,720.

As it relates to the Company as lessor, the Company did not experience a material impact on the recognition of leases in the consolidated financial statements because under ASC 842, lessors continue to account for leases using an approach that is substantially equivalent to historical guidance for sales-type leases, direct financing leases, and operating leases. The Company elected a practical expedient which allows lessors to not separate non-lease components from the lease component when the timing and pattern of transfer for the lease components and non-lease components are the same and if the lease component is classified as an operating lease. As a result, on January 1, 2019, the Company began presenting all rentals and reimbursements from tenants as a single line item rental income within the consolidated statements of operations. As of January 1, 2019, the Company implemented changes to its business processes and controls related to accounting for and the presentation and disclosure of leases, including the reclassification of tenant reimbursements, previously disclosed as part of tenant reimbursements and other, to rental income, in the consolidated statements of operations.

Under ASC 842, beginning on January 1, 2019, changes in the probability of collecting tenant rental income could result in direct adjustments of rental income and tenant receivables. The Company did not experience a material impact on its rental income and tenant receivables as of the adoption date.

The Company’s rental income consists of fixed rental payments from tenants under operating leases and is recognized on a straight-line basis over the respective operating lease terms. The Company recognizes minimum rent, including rental abatements, concessions and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the non-cancelable term of the related lease. The Company’s rental income that relates to variable lease payments consists of tenant reimbursements and includes reimbursements for recoverable costs, which are recognized as revenue in the period during which the applicable expenses are incurred and the tenant’s obligation to reimburse the Company arises.

The Company recognized $42,316,920 of rental income related to operating lease payments of which $4,077,927 was for variable lease payments for the three months ended March 31, 2019. For the three months ended March 31, 2019, rental income relating to variable lease payments not included in the measurement of lease receivables was $4,084,886.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (“ASU 2016-13”). ASU 2016-13 requires more timely recording of credit losses on loans and other financial instruments that are not accounted for at fair value through net income (loss), including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other such commitments. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 require the Company to measure all expected credit losses based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the financial assets and eliminates the “incurred loss” methodology in current GAAP. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses (“ASU 2018-19”), which clarifies that operating lease receivables accounted for under ASC 842 Leases, are not in the scope of the new credit losses guidance. The effective date and transition requirements for this guidance are the same as for ASU 2016-13. ASU 2016-13 is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and related disclosures and does not expect a material impact on its consolidated financial statements and related disclosures from its adoption.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement “ASU 2018-13”). The FASB issued ASU 2018-13 to improve the effectiveness of fair value measurement disclosures by adding, eliminating, and modifying certain disclosure requirements. The issuance of ASU 2018-13 is part of a disclosure framework project. The disclosure framework project’s objective and primary focus are to improve the effectiveness of disclosures in the notes to financial statements by facilitating clear communication of the information required by GAAP that is most important to users of each entity’s financial statements. Achieving the objective of improving the effectiveness of the notes to financial statements includes: (1) the development of a framework that promotes consistent decisions by the FASB board about disclosure requirements and (2) the appropriate exercise of discretion by reporting entities. The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in FASB Concepts Statement, Conceptual Framework for Financial Reporting-Chapter 8: Notes to Financial Statements, including the consideration of costs and benefits. ASU 2018-13 removed certain disclosure requirements under Topic 820 such as the disclosure requirements of the valuation process for level 3 fair value measurements and modified and added certain of the disclosure requirements in Topic 820. ASU 2018-13 requires prospective and retrospective application depending on the amendment and is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact ASU 2018-13 will have on its consolidated financial statements and related disclosures and believes that certain disclosures of interest rate cap agreements in its consolidated financial statements may be impacted by the adoption of ASU 2018-13.

The SEC’s Disclosure Update and Simplification rule (Release 33-10532) amends the interim financial statement requirements to require a reconciliation of changes in stockholder’ equity in the notes or as a separate statement. This analysis should reconcile the beginning balance to the ending balance of each caption in stockholders’ equity for each period for which an income statement is required to be filed and comply with the remaining content requirements of Rule 3-04 of Regulation S-X. As a result, registrants will have to provide the reconciliation for both the year-to-date and quarterly periods and comparable periods in Form 10-Q but only for the year-to-date periods in registration statements. The rule does not prescribe the format of the presentation as long as the appropriate periods are provided. Per a Compliance and Disclosure Interpretation (Q 105.09, Exchange Act Forms, 10-Q), “The amendments are effective for all filings made on or after November 5, 2018. In light of the timing of effectiveness of the amendments and proximity of effectiveness to the filing date for most filers’ quarterly reports, the staff would not object if the filer’s first presentation of the changes in the shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments.” This allows the Company to adopt the amendment for the Company’s first quarter 2019 filing. The Company has adopted this guidance in the three months ended March 31, 2019 by presenting a reconciliation of changes in stockholders’ equity for the current and prior period as a separate statement.

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Real Estate

3 Months Ended

Mar. 31, 2019

Real Estate [Abstract]

Real Estate

Real Estate

As of March 31, 2019, the Company owned 34 multifamily properties comprising a total of 11,601 apartment homes. The total contract acquisition price of the Company’s real estate portfolio was $1,499,381,750. As of March 31, 2019 and December 31, 2018, the Company’s portfolio was approximately 94.1% and 93.9% occupied and the average monthly rent was $1,171 and $1,163, respectively.

As of March 31, 2019 and December 31, 2018, accumulated depreciation and amortization related to the Company’s consolidated real estate properties was as follows:

	March 31, 2019
	Assets
	Land		Building and Improvements			Total Real Estate
Investments in real estate	$	164,113,072	$	1,414,902,453		$	1,579,015,525
Less: Accumulated depreciation and amortization	—		(236,954,186		)	(236,954,186		)
Net investments in real estate and related lease intangibles	$	164,113,072	$	1,177,948,267		$	1,342,061,339

	December 31, 2018
	Assets
	Land		Building and Improvements			Total Real Estate
Investments in real estate	$	164,113,072	$	1,411,198,832		$	1,575,311,904
Less: Accumulated depreciation and amortization	—		(218,672,162		)	(218,672,162		)
Net investments in real estate and related lease intangibles	$	164,113,072	$	1,192,526,670		$	1,356,639,742

Depreciation and amortization expense was $18,282,293 and $17,435,350 for the three months ended March 31, 2019 and 2018, respectively, all of which related to the depreciation of the Company’s buildings and improvements.

Operating Leases

As of March 31, 2019, the Company’s real estate portfolio comprised 11,601 residential apartment homes and was 95.8% leased by a diverse group of residents. The residential lease terms consist of lease durations equal to twelve months or less.

Some residential leases contain provisions to extend the lease agreements, options for early termination after paying a specified penalty and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires security deposits from tenants in the form of a cash deposit. Amounts required as security deposits vary depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to tenant leases are included in accounts payables and accrued liabilities in the accompanying consolidated balance sheets and totaled $4,207,869 and $4,130,860 as of March 31, 2019 and December 31, 2018, respectively.

As of March 31, 2019 and 2018, no tenant represented over 10% of the Company’s annualized base rent.

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Other Assets

3 Months Ended

Mar. 31, 2019

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Other Assets

Other Assets

As of March 31, 2019 and December 31, 2018, other assets consisted of:

	March 31, 2019		December 31, 2018
Prepaid expenses	$	1,050,608	$	1,690,959
Interest rate cap agreements	28,153		207,769
Escrow deposits for pending real estate acquisitions	1,300,200		100,000
Other deposits	1,024,526		924,997
Operating lease right-of-use assets, net	6,768		—
Other assets	$	3,410,255	$	2,923,725

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Debt

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Debt

Debt

Mortgage Notes Payable

The following is a summary of mortgage notes payable, net secured by real property as of March 31, 2019 and December 31, 2018.

	March 31, 2019
			Interest Rate Range				Weighted Average Interest Rate
Type	Number of Instruments	Maturity Date Range	Minimum		Maximum			Principal Outstanding
Variable rate(1)	8	12/1/2024 - 11/1/2025	1-Mo LIBOR + 1.88%		1-Mo LIBOR + 2.28%		4.50%	$	277,432,000
Fixed rate	7	7/1/2025 - 5/1/2054	4.34	%	4.60	%	4.45%	227,882,876
Mortgage notes payable, gross	15						4.48%	505,314,876
Deferred financing costs, net(2)								(3,270,397		)
Mortgage notes payable, net								$	502,044,479

	December 31, 2018
			Interest Rate Range				Weighted Average Interest Rate
Type	Number of Instruments	Maturity Date Range	Minimum		Maximum			Principal Outstanding
Variable rate(1)	8	12/1/2024 - 11/1/2025	1-Mo LIBOR + 1.88%		1-Mo LIBOR + 2.28%		4.53%	$	277,432,000
Fixed rate	7	7/1/2025 - 5/1/2054	4.34	%	4.60	%	4.45%	228,127,333
Mortgage notes payable, gross	15						4.49%	505,559,333
Deferred financing costs, net(2)								(3,416,027		)
Mortgage notes payable, net								$	502,143,306

___________

(1) See Note 10 (Derivative Financial Instruments) for a discussion of the interest rate cap agreements used to manage the exposure to interest rate movement on the Company’s variable rate loans.

(2) Accumulated amortization related to deferred financing costs as of March 31, 2019 and December 31, 2018, was $1,747,920 and $1,602,290, respectively.

CME Loans

On July 31, 2018, (the “Closing Date”), five indirect wholly-owned subsidiaries of the Company terminated the existing mortgage loans with their lenders for an aggregate principal amount of $131,318,742 and entered into new mortgage loan agreements with PNC Bank, National Association (“PNC Bank”) for an aggregate principal amount of $160,850,000 pursuant to the Freddie Mac Capital Markets Execution Program (“CME”). Each loan agreement provides for a term loan (each a “CME Loan” and, collectively the “CME Loans”) with a maturity date of August 1, 2028, unless the maturity date is accelerated in accordance with the loan terms. Each CME Loan accrues interest at a fixed rate of 4.43% per annum. The entire outstanding principal balance and any accrued and unpaid interest on each of the CME Loans are due on the maturity date. Interest only payments on the CME Loans are payable monthly in arrears on specified dates as set forth in each loan agreement and interest and principal payments are due beginning September 1, 2023. Monthly payments are due and payable on the first day of each month, commencing September 1, 2018. The Company paid $643,400 in the aggregate in loan origination fees to PNC Bank in connection with the refinancings, and paid the Advisor a loan coordination fee of $804,250. The CME Loans are included in the mortgage notes payable table above as of March 31, 2019 and December 31, 2018.

Master Credit Facility

On the Closing Date, 16 indirect wholly-owned subsidiaries of the Company terminated the existing mortgage loans with their lenders for an aggregate principal amount of $479,318,649 and entered into a Master Credit Facility Agreement (“MCFA”) with Newmark Group Inc. (“Facility Lender”) for an aggregate principal amount of $551,669,000. The MCFA provides for three tranches: (i) a fixed rate loan in the aggregate principal amount of $331,001,400 that accrues interest at 4.43% per annum; (ii) a fixed rate loan in the aggregate principal amount of $137,917,250 that accrues interest at 4.57%; and (iii) a variable rate loan in the aggregate principal amount of $82,750,350 that accrues interest at the one-month London Interbank Offered Rate (“LIBOR”) plus 1.70%. The loans have a maturity date of August 1, 2028, unless the maturity date is accelerated in accordance with the terms of the loan documents. Interest only payments are payable monthly through August 1, 2025, with interest and principal payments due monthly thereafter. The Company paid $1,930,842 in the aggregate in loan origination fees to the Facility Lender in connection with the refinancings, and paid the Advisor a loan coordination fee of $2,758,345.

Line of Credit

On May 18, 2016, the Company entered into a line of credit facility (the “Line of Credit”) with PNC Bank in an amount not to exceed $65,000,000. The Line of Credit provided for advances (each, an “LOC Loan” and collectively, the “LOC Loans”) solely for the purpose of financing the costs in connection with acquisitions and development of real estate projects and for general corporate purposes (subject to certain debt service and loan to value requirements). The Line of Credit had a maturity date of May 17, 2019, subject to extension (the “LOC Maturity Date”), as further described in the loan agreement (the “LOC Loan Agreement”) entered into by certain of the Company’s wholly-owned subsidiaries with PNC Bank in connection with the acquisition of the Landings of Brentwood Property (the “Mortgaged Property”). Advances made under the Line of Credit were secured by the Mortgaged Property, as evidenced by the LOC Loan Agreement, the Revolving Credit Loan Note (the “LOC Note”), the Deed of Trust and a Guaranty from the Company (the “LOC Guaranty,” together with the LOC Loan Agreement and the LOC Note, the “LOC Loan Documents”).

The Company had the option to select the interest rate in respect of the outstanding unpaid principal amount of the LOC Loans from the following options (the “Interest Rate Options”): (1) the sum of the Base Rate (as defined in the LOC Loan Agreement) plus 0.60%, or (2) a rate per annum fixed for the applicable LIBOR Interest Period (as defined in the LOC Loan Agreement) equal to the sum of LIBOR plus 1.60%. The Company terminated the Line of Credit on January 9, 2019. Monthly interest payments were due and payable in arrears on the first day of each month and on the LOC Maturity Date. In addition to monthly interest payments, the Company paid PNC Bank a non-refundable commitment fee equal to (a) the average daily difference between (i) the maximum principal amount of the LOC Loans minus (ii) the aggregate outstanding principal amount of all advances multiplied by (b) 0.15%. The commitment fee was payable in arrears on the first day of each calendar quarter until the LOC Maturity Date.

As of March 31, 2019 and December 31, 2018, the advances obtained and certain financing costs incurred under the MCFA and Line of Credit, which is included in credit facilities, net, in the accompanying consolidated balance sheets, are summarized in the following table.

	Amount of Advance as of
	March 31, 2019			December 31, 2018
Principal balance on line of credit, gross(1)	$	—		$	—
Principal balance on master credit facility, gross	551,669,000			551,669,000
Deferred financing costs, neton master credit facility(2)	(3,512,812		)	(3,612,316		)
Deferred financing costs, neton line of credit(3)	—			(44,247		)
Credit facilities, net	$	548,156,188		$	548,012,437

___________

(1) At December 31, 2018, Landings of Brentwood was pledged as collateral pursuant to the Line of Credit. On January 9, 2019, the Company terminated the Line of Credit.

(2) Accumulated amortization related to deferred financing costs in respect of the MCFA as of March 31, 2019 and December 31, 2018, was $528,145 and $428,641, respectively.

(3) Accumulated amortization related to deferred financing costs in respect of the Line of Credit as of March 31, 2019 and December 31, 2018, was $0 and $280,753, respectively.

Maturity and Interest

The following is a summary of the Company’s aggregate maturities as of March 31, 2019:

					Maturities During the Years Ending December 31,
Contractual Obligations	Total		Remainder of 2019		2020		2021		2022		2023		Thereafter
Principal payments on outstanding debt(1)	$	1,056,983,876	$	722,489	$	1,187,673	$	5,119,580	$	5,225,051	$	6,037,673	$	1,038,691,410

___________

(1) Projected principal payments on outstanding debt obligations are based on the terms of the notes payable agreements. Amounts exclude the amortization of deferred financing costs associated with the notes payable.

The Company’s notes payable and credit facility documents contain customary financial and non-financial debt covenants. As of March 31, 2019, the Company was in compliance with all debt covenants.

For the three months ended March 31, 2019 and 2018, the Company incurred interest expense of $12,233,295 and $9,114,355, respectively. Interest expense for the three months ended March 31, 2019 and 2018, includes amortization of deferred financing costs of $247,773 and $246,274, net unrealized losses (gains) from the change in fair value of interest rate cap agreements of $179,616 and $(447,614), amortization of loan discount of $0 and $88,746, Credit Facility commitment fees of $2,137 and $7,397 and costs associated with the refinancing of debt of $0 and $21,472, respectively.

Interest expense of $4,049,641 and $4,006,127 was payable as of March 31, 2019 and December 31, 2018, respectively, and is included in accounts payable and accrued liabilities in the accompanying consolidated balance sheets.

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Stockholders' Equity

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Stockholders' Equity

Stockholders’ Equity

General

Under the Company’s Articles of Amendment and Restatement (the “Charter”), the total number of shares of capital stock authorized for issuance is 1,100,000,000 shares, consisting of 999,999,000 shares of common stock with a par value of $0.01 per share, 1,000 shares of convertible stock with a par value of $0.01 per share and 100,000,000 shares designated as preferred stock with a par value of $0.01 per share.

Common Stock

The shares of the Company’s common stock entitle the holders to one vote per share on all matters upon which stockholders are entitled to vote, to receive dividends and other distributions as authorized by the Company’s board of directors in accordance with the Maryland General Corporation Law and to all rights of a stockholder pursuant to the Maryland General Corporation Law. The common stock has no preferences or preemptive, conversion or exchange rights.

On September 3, 2013, the Company issued 13,500 shares of common stock to the Sponsor for $202,500. From inception through March 24, 2016, the date of the termination of the Public Offering, the Company had issued 48,625,651 shares of common stock in its Public Offering for offering proceeds of $640,012,497, including 1,011,561 shares of common stock issued pursuant to the DRP for total proceeds of $14,414,752, net of offering costs of $84,837,134. Following the termination of the Public Offering, the Company continues to offer shares pursuant to the DRP. As of March 31, 2019, the Company had issued 53,275,989 shares of common stock for offering proceeds of $708,881,407, including 5,661,962 shares of common stock issued pursuant to the DRP for total proceeds of $83,283,662, net of offering costs of $84,837,134. The offering costs primarily consisted of selling commissions and dealer manager fees paid in the Primary Offering.

As further discussed in Note 8 (Incentive Award Plan and Independent Director Compensation), the shares of restricted common stock vest and become non-forfeitable in four equal annual installments beginning on the date of grant and ending on the third anniversary of the date of grant or will become fully vested and become non-forfeitable on the earlier to occur of (1) the termination of the independent director’s service as a director due to his or her death or disability, or (2) a change in control of the Company.

The issuance and vesting activity for the three months endedMarch 31, 2019, and year ended December 31, 2018, for the restricted stock issued to the Company’s independent directors as compensation for services in connection with the independent directors’ re-election to the board of directors at the Company’s annual meeting were as follows:

	Three Months Ended March 31, 2019	Year Ended December 31, 2018
Nonvested shares at the beginning of the period	7,497	7,497
Granted shares	—	4,998
Vested shares	—	(4,998	)
Nonvested shares at the end of the period	7,497	7,497

Additionally, the weighted average fair value of restricted common stock issued to the Company’s independent directors for the three months endedMarch 31, 2019, and year ended December 31, 2018, was as follows:

Grant Year	Weighted Average Fair Value
2018	$	15.18
2019	n/a

Included in general and administrative expenses is $13,896 and $13,839 for the three months ended March 31, 2019 and 2018, for compensation expense related to the issuance of restricted common stock. As of March 31, 2019, the compensation expense related to the issuance of the restricted common stock not yet recognized was $76,363.The weighted average remaining term of the restricted common stock was approximately 1.0 year as of March 31, 2019. As of March 31, 2019, no shares of restricted common stock issued to the independent directors had been forfeited.

Convertible Stock

The Company issued 1,000 shares of Convertible Stock to the Advisor for $1,000. The Convertible Stock will convert into shares of common stock if and when: (A) the Company has made total distributions on the then-outstanding shares of its common stock equal to the original issue price of those shares plus an aggregate 6.0% cumulative, non-compounded, annual return on the original issue price of those shares, (B) the Company lists its common stock for trading on a national securities exchange, or (C) the Advisory Agreement is terminated or not renewed (other than for “cause” as defined in the Advisory Agreement). In the event of a termination or non-renewal of the Advisory Agreement for cause, all of the shares of the Convertible Stock will be repurchased for $1.00. In general, each share of Convertible Stock will convert into a number of shares of common stock equal to 1/1000 of the quotient of (A) 15% of the excess of (1) the Company’s “enterprise value” plus the aggregate value of distributions paid to date on the then outstanding shares of the Company’s common stock over (2) the aggregate purchase price paid by stockholders for those outstanding shares of common stock plus an aggregated 6.0% cumulative, non-compounded, annual return on the original issue price of those outstanding shares, divided by (B) the Company’s enterprise value divided by the number of outstanding shares of common stock on an as-converted basis, in each case calculated as of the date of the conversion.

Preferred Stock

The Charter also provides the Company’s board of directors with the authority to issue one or more classes or series of preferred stock, and prior to the issuance of such shares of preferred stock, the board of directors shall have the power from time to time to classify or reclassify, in one or more series, any unissued shares and designate the preferences, rights and privileges of such shares of preferred stock. The Company’s board of directors is authorized to amend the Charter without the approval of the stockholders to increase the aggregate number of authorized shares of capital stock or the number of shares of any class or series that the Company has authority to issue. As of March 31, 2019 and December 31, 2018, no shares of the Company’s preferred stock were issued and outstanding.

Distribution Reinvestment Plan

The Company’s board of directors has approved the DRP through which common stockholders may elect to reinvest an amount equal to the distributions declared on their shares of common stock in additional shares of the Company’s common stock in lieu of receiving cash distributions. The purchase price per share under the DRP was initially $14.25. On March 12, 2019, March 14, 2018 and February 14, 2017, the Company’s board of directors determined a price per share for the DRP of $15.84, $15.18 and $14.85, effective April 1, 2019, April 1, 2018 and March 1, 2017, respectively, in connection with the determination of an estimated value per share of the Company’s common stock.

The Company’s board of directors may again, in its sole discretion, from time to time, change this price based upon changes in the Company’s estimated value per share and other factors that the Company’s board of directors deems relevant.

No sales commissions or dealer manager fees are payable on shares sold through the DRP. The Company’s board of directors may amend, suspend or terminate the DRP at its discretion at any time upon ten days’ notice to the Company’s stockholders. Following any termination of the DRP, all subsequent distributions to stockholders will be made in cash.

Share Repurchase Plan and Redeemable Common Stock

The Company’s share repurchase plan may provide an opportunity for stockholders to have their shares of common stock repurchased by the Company, subject to certain restrictions and limitations. No shares can be repurchased under the Company’s share repurchase plan until after the first anniversary of the date of purchase of such shares; provided, however, that this holding period shall not apply to repurchases requested within two years after the death or disability of a stockholder.

From March 29, 2016, the date the Company first published an estimated value per share, until April 14, 2018, the purchase price for shares repurchased under the Company’s share repurchase plan was as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of Estimated Value per Share(2)
2 years	95.0% of Estimated Value per Share(2)
3 years	97.5% of Estimated Value per Share(2)
4 years	100.0% of Estimated Value per Share(2)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

On March 14, 2018, the board of directors of the Company determined to amend the terms of the Company’s share repurchase plan effective as of April 15, 2018 to (1) limit the amount of shares repurchased pursuant to the Company’s share repurchase plan each quarter to $2,000,000 and (2) revise the repurchase price to an amount equal to 93% of the most recently publicly disclosed estimated value per share. Pursuant to the amended share repurchase plan, the current share repurchase price is $14.73 per share, which represents 93% of the estimated value per share of $15.84. The share repurchase price is further reduced based on how long the stockholder has held the shares as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of the Share Repurchase Price(5)
2 years	95.0% of the Share Repurchase Price(5)
3 years	97.5% of the Share Repurchase Price(5)
4 years	100.0% of the Share Repurchase Price(5)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

________________

(1) As adjusted for any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares of common stock. Repurchase price includes the full amount paid for each share, including all sales commissions and dealer manager fees. 

(2) The “Estimated Value per Share” is the most recently publicly disclosed estimated value per share determined by the Company’s board of directors.

(3) The required one-year holding period does not apply to repurchases requested within two years after the death or disability of a stockholder.

(4) The purchase price per share for shares repurchased upon the death or disability of a stockholder will be equal to the average issue price per share for all of the stockholder’s shares.

(5) The “Share Repurchase Price” equals 93% of the Estimated Value per Share.

The purchase price per share for shares repurchased pursuant to the Company’s share repurchase plan will be further reduced by the aggregate amount of net proceeds per share, if any, distributed to the Company’s stockholders prior to the Repurchase Date (defined below) as a result of the sale of one or more of the Company’s assets that constitutes a return of capital as a result of such sales.

Repurchases of shares of the Company’s common stock are made quarterly upon written request to the Company at least 15 days prior to the end of the applicable quarter. Repurchase requests are honored approximately 30 days following the end of the applicable quarter (“Repurchase Date”). Stockholders may withdraw their repurchase request at any time up to three business days prior to the Repurchase Date.

The Company is not obligated to repurchase shares of its common stock under the share repurchase plan. The share repurchase plan limits the number of shares to be repurchased in any calendar year to the lesser of (1) 5% of the weighted average number of shares of common stock outstanding during the prior calendar year and (2) those that could be funded from the net proceeds from the sale of shares under the DRP in the prior calendar year, plus such additional funds as may be reserved for that purpose by the Company’s board of directors. Such sources of funds could include cash on hand, cash available from borrowings and cash from liquidations of securities investments as of the end of the applicable month, to the extent that such funds are not otherwise dedicated to a particular use, such as working capital, cash distributions to stockholders or purchases of real estate assets. The Company’s board of directors has further limited the amount of shares that may be repurchased pursuant to the share repurchase plan to $2,000,000 per quarter effective April 15, 2018. There is no fee in connection with a repurchase of shares of the Company’s common stock pursuant to the Company’s share repurchase plan. As of March 31, 2019, the Company had recognized repurchases payable of $2,000,000, which is included in accounts payable and accrued liabilities on the accompanying consolidated balance sheets.

During the three months ended March 31, 2019, the Company repurchased a total of 138,961 shares with a total repurchase value of $2,000,000 and received requests for repurchases of 440,908 shares with a total repurchase value of $6,413,834. During the three months ended March 31, 2018, the Company repurchased a total of 202,170 shares with a total repurchase value of $2,886,216 and received requests for the repurchase of 309,952 shares with a total repurchase value of $4,262,726, respectively.

As of March 31, 2019 and 2018, the Company’s total outstanding repurchase requests received that were not repurchased pursuant to the Company’s limitations on repurchases (discussed below) were 1,589,499 shares and 309,952 shares, respectively, with a total net repurchase value of $23,205,024 and $4,262,726, respectively.

The Company cannot guarantee that the funds set aside for the share repurchase plan will be sufficient to accommodate all repurchase requests made in any quarter. In the event that the Company does not have sufficient funds available to repurchase all of the shares of the Company’s common stock for which repurchase requests have been submitted in any quarter, priority will be given to repurchase requests in the case of the death or disability of a stockholder. If the Company repurchases less than all of the shares subject to a repurchase request in any quarter, with respect to any shares which have not been repurchased, the Company will treat the shares that have not been repurchased as a request for repurchase in the following quarter pursuant to the limitations of the share repurchase plan and when sufficient funds are available, unless the stockholder withdraws the request for repurchase. Such pending requests will be honored among all requests for repurchases in any given repurchase period as follows: first, pro rata as to repurchases sought upon a stockholder’s death or disability; and, next, pro rata as to other repurchase requests.

The Company’s board of directors may again, in its sole discretion, amend, suspend or terminate the share repurchase plan at any time upon 30 days’ notice to its stockholders if it determines that the funds available to fund the share repurchase plan are needed for other business or operational purposes or that amendment, suspension or termination of the share repurchase plan is in the best interest of the Company’s stockholders. Therefore, a stockholder may not have the opportunity to make a repurchase request prior to any potential termination or suspension of the Company’s share repurchase plan. The share repurchase plan will terminate in the event that a secondary market develops for the Company’s shares of common stock.

Pursuant to the share repurchase plan, for the three months endedMarch 31, 2019, the Company had no amounts to reclassify from temporary equity to permanent equity. For the three months endedMarch 31, 2018, the Company reclassified $37,028,102, net of $2,886,216 of fulfilled redemption requests, from temporary equity to permanent equity, which is included in additional paid-in capital on the accompanying consolidated balance sheets.

Distributions

The Company’s long-term goal is to pay distributions solely from cash flow from operations. However, because the Company may receive income from interest or rents at various times during the Company’s fiscal year and because the Company may need cash flow from operations during a particular period to fund capital expenditures and other expenses, the Company expects that at times during the Company’s operational stage, the Company will declare distributions in anticipation of cash flow that the Company expects to receive during a later period, and the Company expects to pay these distributions in advance of its actual receipt of these funds. The Company’s board of directors has the authority under its organizational documents, to the extent permitted by Maryland law, to fund distributions from sources such as borrowings, offering proceeds or advances and the deferral of fees and expense reimbursements by the Advisor, in its sole discretion. The Company has not established a limit on the amount of proceeds it may use to fund distributions from sources other than cash flow from operations. If the Company pays distributions from sources other than cash flow from operations, the Company will have fewer funds available and stockholders’ overall return on their investment in the Company may be reduced.

To maintain the Company’s qualification as a REIT, the Company must make aggregate annual distributions to its stockholders of at least 90% of its REIT taxable income (which is computed without regard to the dividends-paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP). If the Company meets the REIT qualification requirements, the Company generally will not be subject to federal income tax on the income that the Company distributes to its stockholders each year.

Distributions Declared

The Company’s board of directors approved a cash distribution that accrues at a rate of $0.002466 per day for each share of the Company’s common stock during each of the three months ended March 31, 2019 and 2018, which, if paid over a 365-day period, is equivalent to a 6.0% annualized distribution rate based on a purchase price of $15.00 per share of the Company’s common stock. The distributions declared accrue daily to stockholders of record as of the close of business on each day and are payable in cumulative amounts on or before the third day of each calendar month with respect to the prior month. There is no guarantee that the Company will continue to pay distributions at this rate or at all.

Distributions declared for the three months endedMarch 31, 2019 and 2018 were $11,511,537 and $11,312,463, including $5,343,926 and $5,671,096, or 352,037 shares and 381,892 shares, respectively, of common stock attributable to the DRP.

As of March 31, 2019 and December 31, 2018, $3,970,014 and $3,953,499 of distributions declared were payable, which included $1,826,188 and $1,860,828, or 120,302 shares and 122,584 shares of common stock attributable to the DRP, respectively.

Distributions Paid

For the three months endedMarch 31, 2019 and 2018, the Company paid cash distributions of $6,116,456 and $5,597,521, which related to distributions declared for each day in the period from December 1, 2018, through February 28, 2019, and December 1, 2017, through February 28, 2018, respectively. Additionally, for the three months endedMarch 31, 2019 and 2018, 354,319 and 383,908 shares of common stock were issued pursuant to the DRP for gross offering proceeds of $5,378,566 and $5,701,030, respectively. For the three months endedMarch 31, 2019 and 2018, the Company paid total distributions of $11,495,022 and $11,298,551, respectively.

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Related Party Arrangements

3 Months Ended

Mar. 31, 2019

Related Party Transactions [Abstract]

Related Party Arrangements

Related Party Arrangements

The Company has entered into the Advisory Agreement with the Advisor. Pursuant to the Advisory Agreement, the Company is obligated to pay the Advisor specified fees upon the provision of certain services related to the investment of funds in real estate and real estate-related investments and the management of the Company’s investments and for other services (including, but not limited to, the disposition of investments). Subject to the limitations described below, the Company is also obligated to reimburse the Advisor and its affiliates for organization and offering costs incurred by the Advisor and its affiliates on behalf of the Company, as well as acquisition and origination expenses and certain operating expenses incurred on behalf of the Company or incurred in connection with providing services to the Company.

Amounts attributable to the Advisor and its affiliates incurred (earned) for the three months endedMarch 31, 2019 and 2018 and amounts attributable to the Advisor and its affiliates that are payable (prepaid) as of March 31, 2019 and December 31, 2018 are as follows:

	Incurred (Earned) For The Three Months Ended March 31,					Payable (Prepaid) as of
	2019			2018		March 31, 2019			December 31, 2018
Consolidated Statements of Operations:
Expensed
Investment management fees(1)	$	4,160,152		$	4,262,253	$	5,120		$	55,865
Property management:
Fees(1)	1,234,277			1,191,167		414,625			410,424
Reimbursement of on-site personnel(2)	3,727,705			3,562,735		956,003			768,107
Reimbursement of other(1)	671,219			343,258		39,046			41,989
Reimbursement of property operations(2)	23,142			23,649		—			—
Reimbursement of property G&A(3)	34,987			9,299		—			—
Other operating expenses(3)	415,108			261,411		355,927			93,740
Insurance proceeds(4)	—			—		—			(75,000		)
Property insurance(5)	282,315			379,094		(102,677		)	(101,573		)
Rental revenue(6)	(14,745		)	—		—			—
Consolidated Balance Sheets:
Capitalized
Acquisition expenses(7)	64,235			—		—			1,607
Capital expenditures(8)	—			5,622		—			—
Construction management:
Fees(8)	157,899			136,443		21,282			10,281
Reimbursement of labor costs(8)	150,360			232,591		25,841			29,203
Additional paid-in capital
Selling commissions	—			—		244,301			299,952
	$	10,906,654		$	10,407,522	$	1,959,468		$	1,534,595

_____________________

(1) Included in fees to affiliates in the accompanying consolidated statements of operations.

(2) Included in operating, maintenance and management in the accompanying consolidated statements of operations.

(3) Included in general and administrative expenses in the accompanying consolidated statements of operations.

(4) Included in other income in the accompanying consolidated statements of operations.

(5) Property related insurance expense and the amortization of the prepaid insurance deductible account are included in general and administrative expenses in the accompanying consolidated statements of operations. The amortization of the prepaid property insurance is included in operating, maintenance and management expenses in the accompanying consolidated statements of operations. The prepaid insurance is included in other assets in the accompanying consolidated balance sheets upon payment.

(6) Included in rental income in the accompanying consolidated statements of operations.

(7) Included in total real estate, cost in the accompanying consolidated balance sheets.

(8) Included in building and improvements in the accompanying consolidated balance sheets.

Investment Management Fee

The Company pays the Advisor a monthly investment management fee equal to one-twelfth of 1.0% of (1) the cost of real properties and real estate related assets acquired directly by the Company or (2) the Company’s allocable cost of each real property or real estate related asset acquired through a joint venture. The investment management fee is calculated including acquisition fees, acquisition expenses, cost of development, construction or improvement and any debt attributable to such investments, or the Company’s proportionate share thereof in the case of investments made through joint ventures.

Acquisition Fees and Expenses

The Company pays the Advisor an acquisition fee equal to 1.0% of the cost of investment, which includes the amount actually paid or budgeted to fund the acquisition, origination, development, construction or improvement of any real property or real estate-related asset acquired. In addition to acquisition fees, the Company reimburses the Advisor for amounts directly incurred by the Advisor and amounts the Advisor pays to third parties in connection with the selection, evaluation, acquisition and development of a property or acquisition of real estate-related assets, whether or not the Company ultimately acquires the property or the real estate-related assets.

The Charter limits the Company’s ability to pay acquisition fees if the total of all acquisition fees and expenses relating to the purchase would exceed 4.5% of the contract purchase price. Under the Charter, a majority of the Company’s board of directors, including a majority of the independent directors, is required to approve any acquisition fees (or portion thereof) that would cause the total of all acquisition fees and expenses relating to an acquisition to exceed 4.5% of the contract purchase price. In connection with the purchase of securities, the acquisition fee may be paid to an affiliate of the Advisor that is registered as a Financial Industry Regulatory Authority, Inc. (“FINRA”) member broker-dealer if applicable FINRA rules would prohibit the payment of the acquisition fee to a firm that is not a registered broker-dealer. 

Loan Coordination Fee

The Company pays the Advisor or its affiliate a loan coordination fee equal to 1.0% of the initial amount of the new debt financed or outstanding debt assumed in connection with the acquisition, development, construction, improvement or origination of a property or a real estate-related asset. In addition, in connection with any financing or the refinancing of any debt (in each case, other than identified at the time of the acquisition of a property or a real estate-related asset), the Company pays the Advisor or its affiliate a loan coordination fee equal to 0.75% of the amount of debt financed or refinanced.

Property Management Fees and Expenses

The Company has entered into property management agreements (each, as amended from time to time, a “Property Management Agreement”) with Steadfast Management Company, Inc., an affiliate of the Sponsor (the “Property Manager”), in connection with the management of each of the Company’s properties. The property management fee payable with respect to each property under the Property Management Agreements at March 31, 2019, ranged from 2.50% to 3.0% of the annual gross revenue collected at the property, as determined by the Advisor and approved by a majority of the Company’s board of directors, including a majority of the independent directors. Each Property Management Agreement has an initial one-year term and continues thereafter on a month-to-month basis unless either party gives 60-days’ prior notice of its desire to terminate the Property Management Agreement, provided that the Company may terminate the Property Management Agreement at any time upon a determination of gross negligence, willful misconduct or bad acts of the Property Manager or its employees or upon an uncured breach of the Property Management Agreement upon 30 days’ prior written notice to the Property Manager.

In addition to the property management fee, the Property Management Agreements also specify certain other reimbursements payable to the Property Manager for benefit administration, information technology infrastructure, licenses, support and training services and capital expenditures. The Company also reimburses the Property Manager for the salaries and related benefits of on-site property management employees.

Construction Management Fees and Expenses

The Company has entered into construction management agreements (each, a “Construction Management Agreement”) with Pacific Coast Land & Construction, Inc., an affiliate of the Sponsor (the “Construction Manager”), in connection with capital improvements and renovation or value-enhancement projects for certain properties the Company acquires. The construction management fee payable with respect to each property under the Construction Management Agreements ranges from 8.0% to 12.0% of the costs of the improvements for which the Construction Manager has planning and oversight authority. Generally, each Construction Management Agreement can be terminated by either party with 30 days’ prior written notice to the other party. Construction management fees are capitalized to the respective real estate properties in the period in which they are incurred as such costs relate to capital improvements and renovations for apartment homes taken out of service while they undergo the planned renovation.

The Company may also reimburse the Construction Manager for the salaries and related benefits of certain of its employees for time spent working on capital improvements and renovations.

Property Insurance

The Company deposits amounts with an affiliate of the Sponsor to fund a prepaid insurance deductible account to cover the cost of required insurance deductibles across all properties of the Company and other affiliated entities. Upon filing a major claim, proceeds from the insurance deductible account may be used by the Company or another affiliate of the Sponsor. In addition, the Company deposits amounts with an affiliate of the Sponsor to cover the cost of property and property related insurance across certain properties of the Company.

Other Operating Expense Reimbursement

In addition to the various fees paid to the Advisor, the Company is obligated to pay directly or reimburse all expenses incurred by the Advisor in providing services to the Company, including the Company’s allocable share of the Advisor’s overhead, such as rent, employee costs, utilities and information technology costs. The Company will not reimburse the Advisor for employee costs in connection with services for which the Advisor or its affiliates receive acquisition fees or disposition fees or for the salaries the Advisor pays to the Company’s executive officers.

The Charter limits the Company’s total operating expenses during any four fiscal quarters to the greater of 2% of the Company’s average invested assets or 25% of the Company’s net income for the same period (the “2%/25% Limitation”). The Company may reimburse the Advisor, at the end of each fiscal quarter, for operating expenses incurred by the Advisor; provided, however, that the Company shall not reimburse the Advisor at the end of any fiscal quarter for operating expenses that exceed the 2%/25% Limitation unless the independent directors have determined that such excess expenses were justified based on unusual and non-recurring factors. The Advisor must reimburse the Company for the amount by which the Company’s operating expenses for the preceding four fiscal quarters then ended exceed the 2%/25% Limitation, unless approved by the independent directors. For purposes of determining the 2%/25% Limitation amount, “average invested assets” means the average monthly book value of the Company’s assets invested directly or indirectly in equity interests and loans secured by real estate during the 12-month period before deducting depreciation, bad debts reserves or other non-cash reserves. “Total operating expenses” means all expenses paid or incurred by the Company that are in any way related to the Company’s operation, including the Company’s allocable share of Advisor overhead, but excluding (a) the expenses of raising capital such as organization and offering expenses, legal, audit, accounting, underwriting, brokerage, listing, registration and other fees, printing and other such expenses and taxes incurred in connection with the issuance, distribution, transfer, listing and registration of shares of the Company’s common stock; (b) interest payments; (c) taxes; (d) non-cash expenditures such as depreciation, amortization and bad debt reserves; (e) reasonable incentive fees based on the gain in the sale of the Company’s assets; (f) acquisition fees and acquisition expenses (including expenses relating to potential acquisitions that the Company does not close) and investment management fees; (g) real estate commissions on the resale of investments; and (h) other expenses connected with the acquisition, disposition, management and ownership of investments (including the costs of foreclosure, insurance premiums, legal services, maintenance, repair and improvement of real property).

As of March 31, 2019, the Company’s total operating expenses, as defined above, did not exceed the 2%/25% Limitation.

Disposition Fee

If the Advisor or its affiliates provide a substantial amount of services in connection with the sale of a property or real estate-related asset as determined by a majority of the Company’s independent directors, the Company will pay the Advisor or its affiliates one-half of the brokerage commissions paid, but in no event to exceed 1% of the sales price of each property or real estate-related asset sold. To the extent the disposition fee is paid upon the sale of any assets other than real property, it will be included as an operating expense for purposes of the 2%/25% Limitation. In connection with the sale of securities, the disposition fee may be paid to an affiliate of the Advisor that is registered as a FINRA member broker-dealer if applicable FINRA rules would prohibit the payment of the disposition fee to a firm that is not a registered broker-dealer. As of March 31, 2019, the Company had not sold or otherwise disposed of any properties or any real estate-related assets. Accordingly, the Company had not incurred any disposition fees as of March 31, 2019. 

Selling Commissions and Dealer Manager Fees

The Company entered into the Dealer Manager Agreement with the Dealer Manager in connection with the Public Offering. The Company paid the Dealer Manager up to 7% and 3% of the gross offering proceeds from the Primary Offering as selling commissions and dealer manager fees, respectively. The Dealer Manager reallowed 100% of sales commissions earned to participating broker-dealers. The Dealer Manager could also reallow to any participating broker-dealer a portion of the dealer manager fee that was attributable to that participating broker-dealer for certain marketing costs of that participating broker-dealer. The Dealer Manager negotiated the reallowance of the dealer manager fee on a case-by-case basis with each participating broker-dealer subject to various factors associated with the cost of the marketing program. The Company allowed a participating broker-dealer to elect to receive the 7% selling commissions at the time of sale or elect to have the selling commission paid on a trailing basis. A participating broker-dealer that elected to receive a trailing selling commission is paid as follows: 3% at the time of sale and the remaining 4% paid ratably (1% per year) on each of the first four anniversaries of the sale. A reduced sales commission and dealer manager fee was paid in connection with volume discounts and certain other categories of sales. No sales commission or dealer manager fee was paid with respect to shares of common stock issued pursuant to the DRP. The Company terminated the Public Offering on March 24, 2016, and as of March 31, 2019 and December 31, 2018, expects to pay trailing selling commissions of $244,301 and $299,952, respectively, which were charged to additional paid-in capital and included within amounts due to affiliates in the accompanying consolidated balance sheets.

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Incentive Award Plan and Independent Director Compensation

3 Months Ended

Mar. 31, 2019

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Incentive Award Plan and Independent Director Compensation

Incentive Award Plan and Independent Director Compensation

The Company has adopted an incentive award plan (the “Incentive Award Plan”) that provides for the grant of equity awards to its employees, directors and consultants and those of the Company’s affiliates. The Incentive Award Plan authorizes the grant of non-qualified and incentive stock options, restricted stock awards, restricted stock units, stock appreciation rights, dividend equivalents and other stock-based awards or cash-based awards.

Under the Company’s independent directors’ compensation plan, which is a sub-plan of the Incentive Award Plan, each of the Company’s independent directors received 3,333 shares of restricted common stock once the Company raised $2,000,000 in gross offering proceeds in the Public Offering. Each subsequent independent director that joins the Company’s board of directors receives 3,333 shares of restricted common stock upon election to the Company’s board of directors. In addition, on the date following an independent director’s re-election to the Company’s board of directors, he or she receives 1,666 shares of restricted common stock. One-fourth of the shares of restricted common stock generally vest and become non-forfeitable upon issuance and the remaining portion will vest in three equal annual installments beginning on the date of grant and ending on the third anniversary of the date of grant; provided, however, that the restricted stock will become fully vested and become non-forfeitable on the earlier to occur of (1) the termination of the independent director’s service as a director due to his or her death or disability, or (2) a change in control of the Company. These restricted stock awards entitle the holders to participate in distributions even if the shares are not fully vested.

The Company recorded stock-based compensation expense of $13,896 and $13,839 for the three months endedMarch 31, 2019 and 2018, respectively, related to the independent directors’ restricted common stock.

In addition to the stock awards, the Company pays each of its independent directors an annual retainer of $55,000, prorated for any partial term (the audit committee chairperson receives an additional $10,000 annual retainer, prorated for any partial term). The independent directors are also paid for attending meetings as follows: (i) $2,500 for each board meeting attended in person, (ii) $1,500 for each committee meeting attended in person in such director’s capacity as a committee member, (iii) $1,000 for each board meeting attended via teleconference (not to exceed $4,000 for any one set of meetings attended on any given day). All directors also receive reimbursement of reasonable out of pocket expenses incurred in connection with attendance at meetings of the board of directors. Director compensation is an operating expense of the Company that is subject to the operating expense reimbursement obligation of the Advisor discussed in Note 7 (Related Party Arrangements). The Company recorded an operating expense of $152,250 and $55,750 for the three months endedMarch 31, 2019 and 2018, related to the independent directors annual retainer and attending board meetings, which is included in general and administrative expenses in the accompanying consolidated statements of operations. As of March 31, 2019 and December 31, 2018, $219,750 and $151,750, respectively, related to the independent directors’ annual retainer and board meetings attendance is included in accounts payable and accrued liabilities in the consolidated balance sheets.

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Commitments and Contingencies

3 Months Ended

Mar. 31, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

Economic Dependency

The Company is dependent on the Advisor for certain services that are essential to the Company, including the identification, evaluation, negotiation, purchase and disposition of real estate and real estate-related investments; management of the daily operations of the Company’s real estate and real estate-related investment portfolio; and other general and administrative responsibilities. In the event that the Advisor is unable to provide such services, the Company will be required to obtain such services from other sources. The Company may not be able to retain services from such other sources on favorable terms or at all.

Concentration of Credit Risk

The geographic concentration of the Company’s portfolio makes it particularly susceptible to adverse economic developments in the Atlanta, Georgia, Dallas/Fort Worth, Texas and Nashville, Tennessee apartment markets. Any adverse economic or real estate developments in these markets, such as business layoffs or downsizing, relocations of businesses, increased competition from other apartment communities, decrease in demand for apartments or any other changes, could adversely affect the Company’s operating results and its ability to make distributions to stockholders.

Environmental

As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. The Company is not aware of any environmental liability that could have a material adverse effect on its financial condition or results of operations. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s properties, the activities of its tenants and other environmental conditions of which the Company is unaware with respect to the properties could result in future environmental liabilities.

Legal Matters

From time to time, the Company is subject, or party, to legal proceedings that arise in the ordinary course of its business. Management is not aware of any legal proceedings of which the outcome is reasonably likely to have a material adverse effect on the Company’s results of operations or financial condition nor is the Company aware of any such legal proceedings contemplated by government agencies.

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Derivative Financial Instruments

3 Months Ended

Mar. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

The Company uses interest rate derivatives with the objective of managing exposure to interest rate movements thereby minimizing the effect of interest rate changes and the effect they could have on future cash flows. Interest rate cap agreements are used to accomplish this objective. The following table provides the terms of the Company’s interest rate derivative instruments that were in effect at March 31, 2019 and December 31, 2018:

March 31, 2019
Type	Maturity Date Range	Based on	Number of Instruments	Notional Amount		Variable Rate	Weighted Average Rate Cap	Fair Value
Interest Rate Cap	4/1/2019 - 8/1/2021	One-Month LIBOR	20	$	667,737,850	2.49%	3.47%	$	28,153

December 31, 2018
Type	Maturity Date Range	Based on	Number of Instruments	Notional Amount		Variable Rate	Weighted Average Rate Cap	Fair Value
Interest Rate Cap	1/1/2019 - 8/1/2021	One-Month LIBOR	22	$	713,237,850	2.52%	3.46%	$	207,769

The interest rate cap agreements are not designated as effective cash flow hedges. Accordingly, the Company records any changes in the fair value of the interest rate cap agreements as interest expense. The change in the fair value of the interest rate cap agreements for the three months endedMarch 31, 2019 and 2018, resulted in an unrealized loss of $179,616 and gain of $447,614, respectively, which is included in interest expense in the accompanying consolidated statements of operations. During the three months endedMarch 31, 2019 and 2018, the Company did not acquire any interest rate cap agreements. The fair value of the interest rate cap agreements of $28,153 and $207,769 as of March 31, 2019 and December 31, 2018, respectively, is included in other assets on the accompanying consolidated balance sheets.

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Subsequent Events

3 Months Ended

Mar. 31, 2019

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

Shares Repurchased

On May 1, 2019, the Company repurchased 135,886 shares of its common stock for a total repurchase value of $2,000,000, or $14.72 per share, pursuant to the Company’s share repurchase program.

Distributions Paid

On April 1, 2019, the Company paid distributions of $3,970,014, which related to distributions declared for each day in the period from March 1, 2019, through March 31, 2019, and consisted of cash distributions paid in the amount of $2,143,826 and $1,826,188 in shares issued pursuant to the DRP.

On May 1, 2019, the Company paid distributions of $3,850,493, which related to distributions declared for each day in the period from April 1, 2019 through April 30, 2019 and consisted of cash distributions paid in the amount of $2,105,481 and $1,745,012 in shares issued pursuant to the DRP.

Distributions Declared

On May 7, 2019, the Company’s board of directors approved and authorized a daily distribution to stockholders of record as of the close of business on each day of the period commencing on July 1, 2019 and ending on September 30, 2019. The distributions will be equal to $0.002466 per share of the Company’s common stock. The distributions for each record date in July 2019, August 2019 and September 2019 will be paid in August 2019, September 2019 and October 2019, respectively. The distributions will be payable to stockholders from legally available funds therefor.

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Summary of Significant Accounting Policies (Policies)

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Principles of Consolidation

Principles of Consolidation and Basis of Presentation

The consolidated financial statements include the accounts of the Company, the Operating Partnership and its subsidiaries. All significant intercompany balances and transactions are eliminated in consolidation. The financial statements of the Company’s subsidiaries are prepared using accounting policies consistent with those of the Company.

Basis of Presentation

The accompanying unaudited consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) for interim financial information as contained within the Financial Accounting Standards Board (“FASB”), Accounting Standards Codification (“ASC”) and the rules and regulations of the SEC, including the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, the unaudited consolidated financial statements do not include all of the information and footnotes required by GAAP for audited financial statements. In the opinion of management, the financial statements for the unaudited interim periods presented include all adjustments that are of a normal and recurring nature and necessary for a fair and consistent presentation of the results of such periods. Operating results for the three months endedMarch 31, 2019, are not necessarily indicative of the results that may be expected for the year ending December 31, 2019. The unaudited consolidated financial statements herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2018.

Use of Estimates

Use of Estimates

The preparation of the consolidated financial statements in conformity with GAAP requires the Company to make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could materially differ from those estimates.

Fair Value Measurements

Fair Value Measurements

Under GAAP, the Company is required to measure certain financial instruments at fair value on a recurring basis. In addition, the Company is required to measure other assets and liabilities at fair value on a non-recurring basis (e.g., carrying value of impaired real estate loans receivable and long-lived assets). Fair value is defined as the price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The GAAP fair value framework uses a three-tiered approach. Fair value measurements are classified and disclosed in one of the following three categories:

• Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;

• Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and

• Level 3: prices or valuation techniques where little or no market data is available that requires inputs that are both significant to the fair value measurement and unobservable.

When available, the Company utilizes quoted market prices from an independent third-party source to determine fair value and will classify such items in Level 1 or Level 2. In instances where the market is not active, regardless of the availability of a nonbinding quoted market price, observable inputs might not be relevant and could require the Company to make a significant adjustment to derive a fair value measurement. Additionally, in an inactive market, a market price quoted from an independent third party may rely more on models with inputs based on information available only to that independent third party. When the Company determines the market for a financial instrument owned by the Company to be illiquid or when market transactions for similar instruments do not appear orderly, the Company uses several valuation sources (including internal valuations, discounted cash flow analysis and quoted market prices) and will establish a fair value by assigning weights to the various valuation sources.

The following describes the valuation methodologies used by the Company to measure fair value, including an indication of the level in the fair value hierarchy in which each asset or liability is generally classified.

Interest rate cap agreements - The Company has entered into certain interest rate cap agreements. These derivatives are recorded at fair value. Fair value was based on a model-driven valuation using the associated variable rate curve and an implied market volatility, both of which were observable at commonly quoted intervals for the full term of the interest rate cap agreements. Therefore, the Company’s interest rate cap agreements were classified within Level 2 of the fair value hierarchy and are included in other assets in the accompanying consolidated balance sheets. Changes in the fair value of the interest rate cap agreements are recorded as interest expense in the accompanying consolidated statements of operations.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The accompanying consolidated balance sheets include the following financial instruments: cash and cash equivalents, restricted cash, rents and other receivables, accounts payable and accrued liabilities, distributions payable, due to affiliates and notes payable.

The Company considers the carrying value of cash and cash equivalents, restricted cash, rents and other receivables, accounts payable and accrued liabilities and distributions payable to approximate the fair value of these financial instruments based on the short duration between origination of the instruments and their expected realization. The fair value of amounts due to affiliates is not determinable due to the related party nature of such amounts. The Company has determined that its notes payable, net are classified as Level 3 within the fair value hierarchy.

The fair value of the notes payable, net is estimated using a discounted cash flow analysis using borrowing rates available to the Company for debt instruments with similar terms and maturities.

Distribution Policy

Distributions to stockholders are determined by the board of directors of the Company and are dependent upon a number of factors relating to the Company, including funds available for the payment of distributions, financial condition, the timing of property acquisitions, capital expenditure requirements and annual distribution requirements in order for the Company to qualify as a REIT under the Internal Revenue Code.

Distribution Policy

The Company elected to be taxed, and currently qualifies, as a REIT commencing with the taxable year ended December 31, 2014. To maintain its qualification as a REIT, the Company intends to make distributions each taxable year equal to at least 90% of its REIT taxable income (which is determined without regard to the dividends paid deduction or net capital gain and which does not necessarily equal net income as calculated in accordance with GAAP).

Per Share Data

Per Share Data

Basic loss per share attributable to common stockholders for all periods presented are computed by dividing net loss by the weighted average number of shares of the Company’s common stock outstanding during the period. Diluted loss per share is computed based on the weighted average number of shares of the Company’s common stock and all potentially dilutive securities, if any. Distributions declared per common share assume each share was issued and outstanding each day during the period. Nonvested shares of the Company’s restricted common stock and convertible stock give rise to potentially dilutive shares of the Company’s common stock but such shares were excluded from the computation of diluted earnings per share because such shares were anti-dilutive during the period.

Segment Disclosure

Segment Disclosure

The Company has determined that it has one reportable segment with activities related to investing in multifamily properties. The Company’s investments in real estate are in different geographic regions, and management evaluates operating performance on an individual asset level. However, as each of the Company’s assets has similar economic characteristics, tenants and products and services, its assets have been aggregated into one reportable segment.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In February 2016, the FASB established ASC Topic 842, Leases (“ASC 842”), by issuing ASU 2016-02, which requires lessees to recognize right-of-use assets and lease liabilities for operating leases on the balance sheet and disclose key information about leasing arrangements. ASC 842 also makes targeted changes to lessor accounting. ASC 842 was subsequently amended by ASU 2018-01, Land Easement Practical Expedient for Transition to Topic 842 (“ASU 2018-01”), ASU 2018-10, Codification Improvements to Topic 842 (“ASU 2018-10”), ASU 2018-11, Targeted Improvements (ASU 2018-11”) and ASU 2018-20, Leases (Topic 842), Narrow-scope Improvements for Lessors (“ASU 2018-20”). ASC 842 requires a modified retrospective transition approach and was effective in the first quarter of 2019 and allowed for early adoption. The Company elected an optional transition method that allows entities to initially apply ASC 842 at the adoption date (January 1, 2019) and recognize a cumulative-effect adjustment to the opening balance of retained earnings in the period of adoption. The Company evaluated the impact of ASC 842 on its leases both as it relates to the Company acting as a lessee and as a lessor. Based on its evaluation, as it relates to the former, the Company elected to apply each of the practical expedients described in ASC 842-10-65-1(f) that allowed the Company, among other things, to not reassess lease classification conclusions or initial direct cost accounting as of December 31, 2018, therefore these leases continue to be accounted for as operating leases. The Company also elected the practical expedient described in ASC 842-20-25-2 not to apply the recognition requirements in ASC 842 to short-term leases and instead, to recognize lease payments in the consolidated statement of operations on a straight-line basis over the lease term. The Company did not experience a material impact on the recognition of leases in the consolidated financial statements because the quantity of leased equipment by the Company is limited and immaterial to the consolidated financial statements. Upon adoption, the Company recognized an initial operating lease right-of-use asset, net, of $7,656 and an operating lease liability, net, of $7,720.

As it relates to the Company as lessor, the Company did not experience a material impact on the recognition of leases in the consolidated financial statements because under ASC 842, lessors continue to account for leases using an approach that is substantially equivalent to historical guidance for sales-type leases, direct financing leases, and operating leases. The Company elected a practical expedient which allows lessors to not separate non-lease components from the lease component when the timing and pattern of transfer for the lease components and non-lease components are the same and if the lease component is classified as an operating lease. As a result, on January 1, 2019, the Company began presenting all rentals and reimbursements from tenants as a single line item rental income within the consolidated statements of operations. As of January 1, 2019, the Company implemented changes to its business processes and controls related to accounting for and the presentation and disclosure of leases, including the reclassification of tenant reimbursements, previously disclosed as part of tenant reimbursements and other, to rental income, in the consolidated statements of operations.

Under ASC 842, beginning on January 1, 2019, changes in the probability of collecting tenant rental income could result in direct adjustments of rental income and tenant receivables. The Company did not experience a material impact on its rental income and tenant receivables as of the adoption date.

The Company’s rental income consists of fixed rental payments from tenants under operating leases and is recognized on a straight-line basis over the respective operating lease terms. The Company recognizes minimum rent, including rental abatements, concessions and contractual fixed increases attributable to operating leases, on a straight-line basis over the term of the non-cancelable term of the related lease. The Company’s rental income that relates to variable lease payments consists of tenant reimbursements and includes reimbursements for recoverable costs, which are recognized as revenue in the period during which the applicable expenses are incurred and the tenant’s obligation to reimburse the Company arises.

The Company recognized $42,316,920 of rental income related to operating lease payments of which $4,077,927 was for variable lease payments for the three months ended March 31, 2019. For the three months ended March 31, 2019, rental income relating to variable lease payments not included in the measurement of lease receivables was $4,084,886.

In June 2016, the FASB issued ASU 2016-13, Financial Instruments-Credit Losses (“ASU 2016-13”). ASU 2016-13 requires more timely recording of credit losses on loans and other financial instruments that are not accounted for at fair value through net income (loss), including loans held for investment, held-to-maturity debt securities, trade and other receivables, net investment in leases and other such commitments. ASU 2016-13 requires that financial assets measured at amortized cost be presented at the net amount expected to be collected, through an allowance for credit losses that is deducted from the amortized cost basis. The amendments in ASU 2016-13 require the Company to measure all expected credit losses based upon historical experience, current conditions, and reasonable and supportable forecasts that affect the collectability of the financial assets and eliminates the “incurred loss” methodology in current GAAP. In November 2018, the FASB issued ASU 2018-19, Codification Improvements to Topic 326, Financial Instruments - Credit Losses (“ASU 2018-19”), which clarifies that operating lease receivables accounted for under ASC 842 Leases, are not in the scope of the new credit losses guidance. The effective date and transition requirements for this guidance are the same as for ASU 2016-13. ASU 2016-13 is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted for annual periods beginning after December 15, 2018, including interim periods within those fiscal years. The Company is currently evaluating the impact this guidance will have on its consolidated financial statements and related disclosures and does not expect a material impact on its consolidated financial statements and related disclosures from its adoption.

In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820): Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement “ASU 2018-13”). The FASB issued ASU 2018-13 to improve the effectiveness of fair value measurement disclosures by adding, eliminating, and modifying certain disclosure requirements. The issuance of ASU 2018-13 is part of a disclosure framework project. The disclosure framework project’s objective and primary focus are to improve the effectiveness of disclosures in the notes to financial statements by facilitating clear communication of the information required by GAAP that is most important to users of each entity’s financial statements. Achieving the objective of improving the effectiveness of the notes to financial statements includes: (1) the development of a framework that promotes consistent decisions by the FASB board about disclosure requirements and (2) the appropriate exercise of discretion by reporting entities. The amendments in ASU 2018-13 modify the disclosure requirements on fair value measurements in Topic 820, Fair Value Measurement, based on the concepts in FASB Concepts Statement, Conceptual Framework for Financial Reporting-Chapter 8: Notes to Financial Statements, including the consideration of costs and benefits. ASU 2018-13 removed certain disclosure requirements under Topic 820 such as the disclosure requirements of the valuation process for level 3 fair value measurements and modified and added certain of the disclosure requirements in Topic 820. ASU 2018-13 requires prospective and retrospective application depending on the amendment and is effective for annual periods beginning after December 15, 2019, including interim periods within those fiscal years. Early adoption is permitted. The Company is currently evaluating the impact ASU 2018-13 will have on its consolidated financial statements and related disclosures and believes that certain disclosures of interest rate cap agreements in its consolidated financial statements may be impacted by the adoption of ASU 2018-13.

The SEC’s Disclosure Update and Simplification rule (Release 33-10532) amends the interim financial statement requirements to require a reconciliation of changes in stockholder’ equity in the notes or as a separate statement. This analysis should reconcile the beginning balance to the ending balance of each caption in stockholders’ equity for each period for which an income statement is required to be filed and comply with the remaining content requirements of Rule 3-04 of Regulation S-X. As a result, registrants will have to provide the reconciliation for both the year-to-date and quarterly periods and comparable periods in Form 10-Q but only for the year-to-date periods in registration statements. The rule does not prescribe the format of the presentation as long as the appropriate periods are provided. Per a Compliance and Disclosure Interpretation (Q 105.09, Exchange Act Forms, 10-Q), “The amendments are effective for all filings made on or after November 5, 2018. In light of the timing of effectiveness of the amendments and proximity of effectiveness to the filing date for most filers’ quarterly reports, the staff would not object if the filer’s first presentation of the changes in the shareholders’ equity is included in its Form 10-Q for the quarter that begins after the effective date of the amendments.” This allows the Company to adopt the amendment for the Company’s first quarter 2019 filing. The Company has adopted this guidance in the three months ended March 31, 2019 by presenting a reconciliation of changes in stockholders’ equity for the current and prior period as a separate statement.

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Summary of Significant Accounting Policies (Tables)

3 Months Ended

Mar. 31, 2019

Accounting Policies [Abstract]

Schedule of Assets Required to be Measured at Fair Value on a Recurring Basis

The following tables reflect the Company’s assets required to be measured at fair value on a recurring basis on the consolidated balance sheets:

	March 31, 2019
	Fair Value Measurements Using
	Level 1		Level 2		Level 3
Assets:
Interest rate cap agreements	$	—	$	28,153	$	—

	December 31, 2018
	Fair Value Measurements Using
	Level 1		Level 2		Level 3
Assets:
Interest rate cap agreements	$	—	$	207,769	$	—

Operating Lease, Lease Income

The table below provides a reconciliation of the prior period presentation of the income statement line items that were reclassified in our consolidated statements of operations to conform to the current period presentation, pursuant to the adoption of the new lease accounting standard and election of the single component practical expedient:

	Three Months Ended March 31, 2018
Rental income (presentation prior to January 1, 2019)	$	36,800,334
Tenant reimbursements(1) (presentation prior to January 1, 2019)	3,927,058
Rental income (presentation effective January 1, 2019)	$	40,727,392

______________

(1) Tenant reimbursements include reimbursements for recoverable costs.

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Real Estate (Tables)

3 Months Ended

Mar. 31, 2019

Real Estate [Abstract]

Schedule of Accumulated Depreciation and Amortization Related to Consolidated Real Estate Properties and Related Intangibles

As of March 31, 2019 and December 31, 2018, accumulated depreciation and amortization related to the Company’s consolidated real estate properties was as follows:

	March 31, 2019
	Assets
	Land		Building and Improvements			Total Real Estate
Investments in real estate	$	164,113,072	$	1,414,902,453		$	1,579,015,525
Less: Accumulated depreciation and amortization	—		(236,954,186		)	(236,954,186		)
Net investments in real estate and related lease intangibles	$	164,113,072	$	1,177,948,267		$	1,342,061,339

	December 31, 2018
	Assets
	Land		Building and Improvements			Total Real Estate
Investments in real estate	$	164,113,072	$	1,411,198,832		$	1,575,311,904
Less: Accumulated depreciation and amortization	—		(218,672,162		)	(218,672,162		)
Net investments in real estate and related lease intangibles	$	164,113,072	$	1,192,526,670		$	1,356,639,742

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Other Assets (Tables)

3 Months Ended

Mar. 31, 2019

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

Schedule of Other Assets

As of March 31, 2019 and December 31, 2018, other assets consisted of:

	March 31, 2019		December 31, 2018
Prepaid expenses	$	1,050,608	$	1,690,959
Interest rate cap agreements	28,153		207,769
Escrow deposits for pending real estate acquisitions	1,300,200		100,000
Other deposits	1,024,526		924,997
Operating lease right-of-use assets, net	6,768		—
Other assets	$	3,410,255	$	2,923,725

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Debt (Tables)

3 Months Ended

Mar. 31, 2019

Debt Disclosure [Abstract]

Summary of Mortgage Notes Payable Secured by Real Property

The following is a summary of mortgage notes payable, net secured by real property as of March 31, 2019 and December 31, 2018.

	March 31, 2019
			Interest Rate Range				Weighted Average Interest Rate
Type	Number of Instruments	Maturity Date Range	Minimum		Maximum			Principal Outstanding
Variable rate(1)	8	12/1/2024 - 11/1/2025	1-Mo LIBOR + 1.88%		1-Mo LIBOR + 2.28%		4.50%	$	277,432,000
Fixed rate	7	7/1/2025 - 5/1/2054	4.34	%	4.60	%	4.45%	227,882,876
Mortgage notes payable, gross	15						4.48%	505,314,876
Deferred financing costs, net(2)								(3,270,397		)
Mortgage notes payable, net								$	502,044,479

	December 31, 2018
			Interest Rate Range				Weighted Average Interest Rate
Type	Number of Instruments	Maturity Date Range	Minimum		Maximum			Principal Outstanding
Variable rate(1)	8	12/1/2024 - 11/1/2025	1-Mo LIBOR + 1.88%		1-Mo LIBOR + 2.28%		4.53%	$	277,432,000
Fixed rate	7	7/1/2025 - 5/1/2054	4.34	%	4.60	%	4.45%	228,127,333
Mortgage notes payable, gross	15						4.49%	505,559,333
Deferred financing costs, net(2)								(3,416,027		)
Mortgage notes payable, net								$	502,143,306

___________

(1) See Note 10 (Derivative Financial Instruments) for a discussion of the interest rate cap agreements used to manage the exposure to interest rate movement on the Company’s variable rate loans.

(2) Accumulated amortization related to deferred financing costs as of March 31, 2019 and December 31, 2018, was $1,747,920 and $1,602,290, respectively.

As of March 31, 2019 and December 31, 2018, the advances obtained and certain financing costs incurred under the MCFA and Line of Credit, which is included in credit facilities, net, in the accompanying consolidated balance sheets, are summarized in the following table.

	Amount of Advance as of
	March 31, 2019			December 31, 2018
Principal balance on line of credit, gross(1)	$	—		$	—
Principal balance on master credit facility, gross	551,669,000			551,669,000
Deferred financing costs, neton master credit facility(2)	(3,512,812		)	(3,612,316		)
Deferred financing costs, neton line of credit(3)	—			(44,247		)
Credit facilities, net	$	548,156,188		$	548,012,437

___________

(1) At December 31, 2018, Landings of Brentwood was pledged as collateral pursuant to the Line of Credit. On January 9, 2019, the Company terminated the Line of Credit.

(2) Accumulated amortization related to deferred financing costs in respect of the MCFA as of March 31, 2019 and December 31, 2018, was $528,145 and $428,641, respectively.

(3) Accumulated amortization related to deferred financing costs in respect of the Line of Credit as of March 31, 2019 and December 31, 2018, was $0 and $280,753, respectively.

Summary of Aggregate Maturities

The following is a summary of the Company’s aggregate maturities as of March 31, 2019:

					Maturities During the Years Ending December 31,
Contractual Obligations	Total		Remainder of 2019		2020		2021		2022		2023		Thereafter
Principal payments on outstanding debt(1)	$	1,056,983,876	$	722,489	$	1,187,673	$	5,119,580	$	5,225,051	$	6,037,673	$	1,038,691,410

___________

(1) Projected principal payments on outstanding debt obligations are based on the terms of the notes payable agreements. Amounts exclude the amortization of deferred financing costs associated with the notes payable.

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Stockholders' Equity (Tables)

3 Months Ended

Mar. 31, 2019

Equity [Abstract]

Schedule of Restricted Stock Issued to Independent Directors as Compensation for Services

The issuance and vesting activity for the three months endedMarch 31, 2019, and year ended December 31, 2018, for the restricted stock issued to the Company’s independent directors as compensation for services in connection with the independent directors’ re-election to the board of directors at the Company’s annual meeting were as follows:

	Three Months Ended March 31, 2019	Year Ended December 31, 2018
Nonvested shares at the beginning of the period	7,497	7,497
Granted shares	—	4,998
Vested shares	—	(4,998	)
Nonvested shares at the end of the period	7,497	7,497

Additionally, the weighted average fair value of restricted common stock issued to the Company’s independent directors for the three months endedMarch 31, 2019, and year ended December 31, 2018, was as follows:

Grant Year	Weighted Average Fair Value
2018	$	15.18
2019	n/a

Schedule of Share Repurchase Plan Following Estimated Value Per Share of Common Stock is Published

March 29, 2016, the date the Company first published an estimated value per share, until April 14, 2018, the purchase price for shares repurchased under the Company’s share repurchase plan was as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of Estimated Value per Share(2)
2 years	95.0% of Estimated Value per Share(2)
3 years	97.5% of Estimated Value per Share(2)
4 years	100.0% of Estimated Value per Share(2)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

On March 14, 2018, the board of directors of the Company determined to amend the terms of the Company’s share repurchase plan effective as of April 15, 2018 to (1) limit the amount of shares repurchased pursuant to the Company’s share repurchase plan each quarter to $2,000,000 and (2) revise the repurchase price to an amount equal to 93% of the most recently publicly disclosed estimated value per share. Pursuant to the amended share repurchase plan, the current share repurchase price is $14.73 per share, which represents 93% of the estimated value per share of $15.84. The share repurchase price is further reduced based on how long the stockholder has held the shares as follows:

Share Purchase Anniversary	Repurchase Price on Repurchase Date(1)
Less than 1 year	No Repurchase Allowed
1 year	92.5% of the Share Repurchase Price(5)
2 years	95.0% of the Share Repurchase Price(5)
3 years	97.5% of the Share Repurchase Price(5)
4 years	100.0% of the Share Repurchase Price(5)
In the event of a stockholder’s death or disability(3)	Average Issue Price for Shares(4)

________________

(1) As adjusted for any stock dividends, combinations, splits, recapitalizations or any similar transaction with respect to the shares of common stock. Repurchase price includes the full amount paid for each share, including all sales commissions and dealer manager fees. 

(2) The “Estimated Value per Share” is the most recently publicly disclosed estimated value per share determined by the Company’s board of directors.

(3) The required one-year holding period does not apply to repurchases requested within two years after the death or disability of a stockholder.

(4) The purchase price per share for shares repurchased upon the death or disability of a stockholder will be equal to the average issue price per share for all of the stockholder’s shares.

(5) The “Share Repurchase Price” equals 93% of the Estimated Value per Share.

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Related Party Arrangements (Tables)

3 Months Ended

Mar. 31, 2019

Related Party Transactions [Abstract]

Schedule of Amounts Attributable to the Advisor and its Affiliates

Amounts attributable to the Advisor and its affiliates incurred (earned) for the three months endedMarch 31, 2019 and 2018 and amounts attributable to the Advisor and its affiliates that are payable (prepaid) as of March 31, 2019 and December 31, 2018 are as follows:

	Incurred (Earned) For The Three Months Ended March 31,					Payable (Prepaid) as of
	2019			2018		March 31, 2019			December 31, 2018
Consolidated Statements of Operations:
Expensed
Investment management fees(1)	$	4,160,152		$	4,262,253	$	5,120		$	55,865
Property management:
Fees(1)	1,234,277			1,191,167		414,625			410,424
Reimbursement of on-site personnel(2)	3,727,705			3,562,735		956,003			768,107
Reimbursement of other(1)	671,219			343,258		39,046			41,989
Reimbursement of property operations(2)	23,142			23,649		—			—
Reimbursement of property G&A(3)	34,987			9,299		—			—
Other operating expenses(3)	415,108			261,411		355,927			93,740
Insurance proceeds(4)	—			—		—			(75,000		)
Property insurance(5)	282,315			379,094		(102,677		)	(101,573		)
Rental revenue(6)	(14,745		)	—		—			—
Consolidated Balance Sheets:
Capitalized
Acquisition expenses(7)	64,235			—		—			1,607
Capital expenditures(8)	—			5,622		—			—
Construction management:
Fees(8)	157,899			136,443		21,282			10,281
Reimbursement of labor costs(8)	150,360			232,591		25,841			29,203
Additional paid-in capital
Selling commissions	—			—		244,301			299,952
	$	10,906,654		$	10,407,522	$	1,959,468		$	1,534,595

_____________________

(1) Included in fees to affiliates in the accompanying consolidated statements of operations.

(2) Included in operating, maintenance and management in the accompanying consolidated statements of operations.

(3) Included in general and administrative expenses in the accompanying consolidated statements of operations.

(4) Included in other income in the accompanying consolidated statements of operations.

(5) Property related insurance expense and the amortization of the prepaid insurance deductible account are included in general and administrative expenses in the accompanying consolidated statements of operations. The amortization of the prepaid property insurance is included in operating, maintenance and management expenses in the accompanying consolidated statements of operations. The prepaid insurance is included in other assets in the accompanying consolidated balance sheets upon payment.

(6) Included in rental income in the accompanying consolidated statements of operations.

(7) Included in total real estate, cost in the accompanying consolidated balance sheets.

(8) Included in building and improvements in the accompanying consolidated balance sheets.

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Derivative Financial Instruments (Tables)

3 Months Ended

Mar. 31, 2019

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Schedule of Interest Rate Derivatives

The following table provides the terms of the Company’s interest rate derivative instruments that were in effect at March 31, 2019 and December 31, 2018:

March 31, 2019
Type	Maturity Date Range	Based on	Number of Instruments	Notional Amount		Variable Rate	Weighted Average Rate Cap	Fair Value
Interest Rate Cap	4/1/2019 - 8/1/2021	One-Month LIBOR	20	$	667,737,850	2.49%	3.47%	$	28,153

December 31, 2018
Type	Maturity Date Range	Based on	Number of Instruments	Notional Amount		Variable Rate	Weighted Average Rate Cap	Fair Value
Interest Rate Cap	1/1/2019 - 8/1/2021	One-Month LIBOR	22	$	713,237,850	2.52%	3.46%	$	207,769

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Organization and Business - Narrative (Details)	Sep. 03, 2013 USD ($) $ / shares shares	Aug. 22, 2013 USD ($) shares	Mar. 31, 2019 apartment	Mar. 31, 2019 residential_unit	Mar. 31, 2019 multifamily_property	Mar. 31, 2019 $ / shares
Common Stock [Member]
Initial capitalization
Share price (in dollars per share) | $ / shares						$ 15.00
Common Stock [Member] | Sponsor [Member]
Initial capitalization
Issuance of common stock (in shares) | shares	13,500
Share price (in dollars per share) | $ / shares	$ 15
Issuance of common stock | $	$ 202,500
Convertible Stock [Member] | Advisor [Member]
Initial capitalization
Issuance of common stock (in shares) | shares		1,000
Issuance of common stock | $		$ 1,000
Residential Real Estate [Member]
Initial capitalization
Number of multifamily properties | multifamily_property					34
Number of apartment homes			11,601	11,601

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Organization and Business - Narrative - Public Offering (Details) - USD ($)			3 Months Ended	31 Months Ended
	Mar. 24, 2016	Dec. 30, 2013	Mar. 31, 2019	Mar. 24, 2016	Mar. 12, 2019	Dec. 31, 2018	Mar. 14, 2018	Feb. 14, 2017
Distribution Reinvestment Plan [Member]
Public Offering Information
Registration statement, price per share (in dollars per share)					$ 15.84		$ 15.18	$ 14.85
Common Stock [Member]
Public Offering Information
Registration statement, price per share (in dollars per share)			$ 15.00
Common Stock [Member] | IPO [Member]
Public Offering Information
Issuance of common stock (in shares)	48,625,651		53,275,989	48,625,651
Proceeds from issuance of common stock	$ 724,849,631		$ 793,718,541	$ 640,012,497
Common Stock [Member] | Primary Offering [Member]
Public Offering Information
Maximum number of shares authorized for sale under registration statement (in shares)		66,666,667
Registration statement, price per share (in dollars per share)		$ 15
Common Stock [Member] | Distribution Reinvestment Plan [Member]
Public Offering Information
Maximum number of shares authorized for sale under registration statement (in shares)		7,017,544
Registration statement, price per share (in dollars per share)		$ 14.25			$ 15.84	$ 15.84
Issuance of common stock (in shares)	1,011,561		5,661,962
Proceeds from issuance of common stock	$ 14,414,752		$ 83,283,662

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Summary of Significant Accounting Policies - Schedule of Assets Required to be Measured at Fair Value on a Recurring Basis (Details) - Interest Rate Cap [Member] - Fair Value, Measurements, Recurring [Member] - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Level 1 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate cap agreements	$ 0	$ 0
Level 2 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate cap agreements	28,153	207,769
Level 3 [Member]
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]
Interest rate cap agreements	$ 0	$ 0

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Summary of Significant Accounting Policies - Narrative - Fair Value of Financial Instruments (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Principal Outstanding	$ 502,044,479	$ 502,143,306
Estimate of Fair Value Measurement [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Mortgage notes payable, fair value	1,071,795,629	1,042,358,884
Reported Value Measurement [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Principal Outstanding	$ 1,050,200,667	$ 1,050,155,743

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Summary of Significant Accounting Policies - Narrative - Distribution Policy (Details) - $ / shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Accounting Policies [Abstract]
Distributions declared per common share (in dollars per share)	$ 0.222	$ 0.222

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Summary of Significant Accounting Policies - Narrative - Segment Disclosure (Details)	3 Months Ended
	Mar. 31, 2019 segment
Accounting Policies [Abstract]
Number of reportable segments	1

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Summary of Significant Accounting Policies Summary of Significant Accounting Policies - Recent Accounting Pronouncements (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Lessee, Lease, Description [Line Items]
Operating lease right-of-use assets, net	$ 6,768
Rental income	42,316,920	$ 40,727,392
Operating Lease, Lease Income		40,727,392
Operating Leases, Lease Income [Abstract]
Rental income		36,800,334
Tenant reimbursements		3,927,058
Rental income		$ 40,727,392
Accounting Standards Update 2016-02 [Member]
Lessee, Lease, Description [Line Items]
Operating lease right-of-use assets, net	7,656
Operating Lease, Liability	7,720
Operating Lease, Variable Lease Income	4,077,927
Operating Lease, Lease Income	4,084,886
Operating Leases, Lease Income [Abstract]
Rental income	$ 4,084,886

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Real Estate - Narrative (Details)	3 Months Ended
	Mar. 31, 2019 USD ($) apartment	Mar. 31, 2018 USD ($)	Mar. 31, 2019 residential_unit	Mar. 31, 2019 multifamily_property
Real Estate Investment Property and Accumulated Depreciation and Amortization [Line Items]
Purchase price	$ 1,499,381,750
Average percentage of real estate portfolio occupied	94.10%	93.90%
Average monthly collected rent	$ 1,171	$ 1,163
Depreciation and amortization	$ 18,282,293	$ 17,435,350
Residential Real Estate [Member]
Real Estate Investment Property and Accumulated Depreciation and Amortization [Line Items]
Number of multifamily properties | multifamily_property				34
Units	11,601		11,601
Average percentage of real estate portfolio occupied	95.80%

XML

Real Estate - Schedule of Accumulated Depreciation and Amortization Related to Consolidated Real Estate Properties and Related Intangibles (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Real Estate Investment Property and Accumulated Depreciation and Amortization [Line Items]
Investments in real estate	$ 1,579,015,525	$ 1,575,311,904
Less: Accumulated depreciation and amortization	(236,954,186)	(218,672,162)
Total real estate, net	1,342,061,339	1,356,639,742
Land [Member]
Real Estate Investment Property and Accumulated Depreciation and Amortization [Line Items]
Investments in real estate	164,113,072	164,113,072
Less: Accumulated depreciation and amortization	0	0
Total real estate, net	164,113,072	164,113,072
Building and Improvements [Member]
Real Estate Investment Property and Accumulated Depreciation and Amortization [Line Items]
Investments in real estate	1,414,902,453	1,411,198,832
Less: Accumulated depreciation and amortization	(236,954,186)	(218,672,162)
Total real estate, net	$ 1,177,948,267	$ 1,192,526,670

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Real Estate - Narrative - Operating Leases (Details)	3 Months Ended
	Mar. 31, 2019 apartment tenant	Mar. 31, 2018 tenant	Mar. 31, 2019 residential_unit	Mar. 31, 2019 USD ($)	Dec. 31, 2018 USD ($)
Real Estate Properties [Line Items]
Average percentage of real estate portfolio occupied	94.10%	93.90%
Maximum [Member]
Real Estate Properties [Line Items]
Operating lease term	12 months
Accounts Payable and Accrued Liabilities [Member]
Real Estate Properties [Line Items]
Security deposit liability | $				$ 4,207,869	$ 4,130,860
Residential Real Estate [Member]
Real Estate Properties [Line Items]
Units	11,601		11,601
Average percentage of real estate portfolio occupied	95.80%
Tenant [Member] | Customer Concentration Risk [Member]
Real Estate Properties [Line Items]
Number of tenants | tenant	0	0

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Other Assets - Schedule of Other Assets (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]
Prepaid expenses	$ 1,050,608	$ 1,690,959
Interest rate cap agreements	28,153	207,769
Escrow deposits for pending real estate acquisitions	1,300,200	100,000
Other deposits	1,024,526	924,997
Operating lease right-of-use assets, net	6,768
Other assets	$ 3,410,255	$ 2,923,725

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Debt - Summary of Mortgage Notes Payable Secured by Real Property (Details)	3 Months Ended
	Mar. 31, 2019 USD ($) instrument	Mar. 31, 2018	Dec. 31, 2018 USD ($) instrument
Debt Instrument [Line Items]
Mortgage notes payable, net	$ 1,050,200,667		$ 1,050,155,743
Notes Payable to Banks [Member]
Debt Instrument [Line Items]
Number of Instruments | instrument	15		15
Weighted Average Interest Rate	4.48%		4.49%
Outstanding principal	$ 505,314,876		$ 505,559,333
Deferred financing costs, net	(3,270,397)		(3,416,027)
Mortgage notes payable, net	502,044,479		502,143,306
Accumulated amortization of debt issuance costs	$ 1,747,920		$ 1,602,290
Notes Payable to Banks [Member] | Mortgage Notes Payable, Variable Interest [Member]
Debt Instrument [Line Items]
Number of Instruments | instrument	8		8
Weighted Average Interest Rate	4.50%		4.53%
Outstanding principal	$ 277,432,000		$ 277,432,000
Notes Payable to Banks [Member] | Mortgage Notes Payable, Fixed Interest [Member]
Debt Instrument [Line Items]
Number of Instruments | instrument	7		7
Weighted Average Interest Rate	4.45%		4.45%
Outstanding principal	$ 227,882,876		$ 228,127,333
Minimum [Member] | Notes Payable to Banks [Member] | Mortgage Notes Payable, Variable Interest [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Basis spread on variable rate	4.34%	4.34%
Minimum [Member] | Notes Payable to Banks [Member] | Mortgage Notes Payable, Fixed Interest [Member]
Debt Instrument [Line Items]
Stated percentage	4.34%		4.34%
Maximum [Member] | Notes Payable to Banks [Member] | Mortgage Notes Payable, Variable Interest [Member] | LIBOR [Member]
Debt Instrument [Line Items]
Basis spread on variable rate	4.60%	4.60%
Maximum [Member] | Notes Payable to Banks [Member] | Mortgage Notes Payable, Fixed Interest [Member]
Debt Instrument [Line Items]
Stated percentage	4.60%		4.60%

XML

Debt - Narrative (Details)			3 Months Ended
	Jul. 31, 2018 USD ($) Subsidiary	May 18, 2016 USD ($)	Mar. 31, 2019 USD ($)	Mar. 31, 2018 USD ($)	Dec. 31, 2018 USD ($)
Debt Instrument [Line Items]
Credit facilities, net			$ 548,156,188		$ 548,012,437
Interest expense			12,233,295	$ 9,114,355
LIne of Credit Facility, Seasoning Fees, Amount			2,137	7,397
Amortization of deferred financing costs			247,773	246,274
Unrealized losses from change in fair value of interest rate cap agreements			(179,616)	447,614
Amortization of loan discount			0	88,746
Credit facility commitment fees			0	21,472
Accounts Payable and Accrued Liabilities [Member]
Debt Instrument [Line Items]
Interest payable			4,049,641		$ 4,006,127
Interest Rate Cap [Member]
Debt Instrument [Line Items]
Unrealized losses from change in fair value of interest rate cap agreements			$ (179,616)	$ 447,614
Master Credit Facility Agreement [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Loan Coordination Advisory Fee, Amount	$ 2,758,345
CME Loan [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Loan Coordination Advisory Fee, Amount	804,250
Line of Credit, PNC Bank [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity		$ 65,000,000
Unused capacity, commitment fee percentage		0.15%
Line of Credit, PNC Bank [Member] | LIBOR [Member] | Line of Credit [Member]
Debt Instrument [Line Items]
Basis spread on variable rate		1.60%
Line of Credit, PNC Bank [Member] | Base Rate [Member] | Line of Credit [Member]
Debt Instrument [Line Items]
Basis spread on variable rate		0.60%
Berkeley Point Capital LLC [Member] | Master Credit Facility Agreement [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	551,669,000
Debt Instrument, Fee Amount	1,930,842
Berkeley Point Capital LLC [Member] | CME Loan [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Debt Instrument, Fee Amount	643,400
Berkeley Point Capital LLC [Member] | Master Credit Facility Agreement Tranche 1 [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 331,001,400
Stated percentage	4.43%
Berkeley Point Capital LLC [Member] | Master Credit Facility Agreement Tranche 2 [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 137,917,250
Stated percentage	4.57%
Berkeley Point Capital LLC [Member] | Master Credit Facility Agreement Tranche 3 [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 82,750,350
Berkeley Point Capital LLC [Member] | Master Credit Facility Agreement Tranche 3 [Member] | LIBOR [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Basis spread on variable rate	1.70%
PNC Bank [Member] | CME Loan [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Maximum borrowing capacity	$ 160,850,000
Stated percentage	4.43%
Subsidiaries [Member] | Berkeley Point Capital LLC [Member] | Master Credit Facility Agreement [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Number of Subsidiaries Refinanced Under Revolving Credit Facility | Subsidiary	16
Repayments of Debt	$ 479,318,649
Subsidiaries [Member] | PNC Bank [Member] | CME Loan [Member] | Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Number of Subsidiaries Refinanced Under Revolving Credit Facility | Subsidiary	5
Repayments of Debt	$ 131,318,742

XML

Debt - Schedule of Advances Under Credit Facilities (Details) - USD ($)	Mar. 31, 2019	Dec. 31, 2018
Debt Instrument [Line Items]
Credit facilities, net	$ 548,156,188	$ 548,012,437
Residential Real Estate [Member]
Debt Instrument [Line Items]
Credit facilities, net	551,669,000	551,669,000
Line of Credit [Member]
Debt Instrument [Line Items]
Deferred financing costs, net	0	(44,247)
Accumulated amortization	0	280,753
Line of Credit [Member] | Residential Real Estate [Member]
Debt Instrument [Line Items]
Credit facilities, net	0	0
Revolving Credit Facility [Member]
Debt Instrument [Line Items]
Deferred financing costs, net	(3,512,812)	(3,612,316)
Accumulated amortization	$ 528,145	$ 428,641

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Debt - Summary of Aggregate Maturities (Details)	Mar. 31, 2019 USD ($)
Debt Disclosure [Abstract]
Total	$ 1,056,983,876
Remainder of 2019	722,489
2020	1,187,673
2021	5,119,580
2022	5,225,051
2023	6,037,673
Thereafter	$ 1,038,691,410

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Stockholders' Equity - Narrative - General (Details) - $ / shares	Mar. 31, 2019	Dec. 31, 2018
Class of Stock [Line Items]
Common and preferred shares authorized (in shares)	1,100,000,000
Preferred stock, shares authorized (in shares)	100,000,000	100,000,000
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common Stock [Member]
Class of Stock [Line Items]
Common stock, shares authorized (in shares)	999,999,000	999,999,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Convertible Stock [Member]
Class of Stock [Line Items]
Common stock, shares authorized (in shares)	1,000	1,000
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01

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Stockholders' Equity - Narrative - Common Stock (Details)						3 Months Ended		31 Months Ended
	Mar. 24, 2016 USD ($) shares	Aug. 13, 2015 shares	Aug. 07, 2014 shares	Feb. 27, 2014 shares	Sep. 03, 2013 USD ($) shares	Mar. 31, 2019 USD ($) vote / shares shares	Mar. 31, 2018 USD ($) $ / shares shares	Mar. 24, 2016 USD ($) shares
Class of Stock [Line Items]
Stock issued during period, dividend reinvestment plan (in shares) | shares						354,319	383,908
Proceeds from issuance of common stock, dividend reinvestment plan						$ 5,378,566	$ 5,701,030
Share-based compensation expense						$ 13,896	$ 13,839
Restricted Stock [Member]
Class of Stock [Line Items]
Shares granted (in shares) | shares						0	4,998
Share based compensation expense						$ 76,363
Weighted-average remaining term						1 year
Forfeited shares (in shares) | shares						0
Common Stock [Member]
Class of Stock [Line Items]
Number of votes per share | vote / shares						1
Common Stock [Member] | IPO [Member]
Class of Stock [Line Items]
Issuance of common stock (in shares) | shares	48,625,651					53,275,989		48,625,651
Proceeds from Issuance of stock, net						$ 708,881,407
Proceeds from issuance of common stock	$ 724,849,631					$ 793,718,541		$ 640,012,497
Common Stock [Member] | Distribution Reinvestment Plan [Member]
Class of Stock [Line Items]
Issuance of common stock (in shares) | shares	1,011,561					5,661,962
Proceeds from issuance of common stock	$ 14,414,752					$ 83,283,662
Stock issued during period, dividend reinvestment plan (in shares) | shares						5,661,962		1,011,561
Proceeds from issuance of stock, dividend reinvestment plan, Net of offering costs						$ 83,283,662		$ 14,414,752
Commissions on sales of common stock and related dealer manager fees to affiliates						84,837,134
Common Stock [Member] | Sponsor [Member]
Class of Stock [Line Items]
Issuance of common stock (in shares) | shares					13,500
Issuance of common stock					$ 202,500
Independent Directors Compensation Plan [Member] | Common Stock [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Shares granted, grant date fair value (in dollars per share) | $ / shares							$ 15.18
Award vesting period		4 years
Share-based compensation expense						13,896	$ 13,839
Independent Directors Compensation Plan [Member] | Common Stock [Member] | Director Two [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Shares granted (in shares) | shares		1,666	1,666	3,333
Independent Directors Compensation Plan [Member] | Common Stock [Member] | Director Three [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Shares granted (in shares) | shares		1,666	1,666	3,333
Independent Directors Compensation Plan [Member] | General and Administrative Expense [Member] | Common Stock [Member] | Restricted Stock [Member]
Class of Stock [Line Items]
Share-based compensation expense						$ 13,896	$ 13,839

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Stockholders' Equity - Schedule of Restricted Stock Issued to Independent Directors as Compensation for Services (Details) - Restricted Stock [Member] - shares	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward]
Nonvested shares at the beginning of the year (in shares)	7,497	7,497
Granted shares (in shares)	0	4,998
Vested shares (in shares)	0	(4,998)
Nonvested shares at the end of the year (in shares)	7,497

XML

Stockholders' Equity - Schedule of Weighted Average Fair Value of Restricted Stock Issued to Independent Directors (Details)	3 Months Ended
	Mar. 31, 2018 $ / shares
Restricted Stock [Member] | Independent Directors Compensation Plan [Member] | Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted, grant date fair value (in dollars per share)	$ 15.18

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Stockholders' Equity - Narrative - Convertible Stock (Details) - Advisor [Member] - Convertible Stock [Member] - USD ($)		3 Months Ended
	Aug. 22, 2013	Mar. 31, 2019
Class of Stock [Line Items]
Conversion basis multiplier		0.0010
Issuance of common stock (in shares)	1,000
Issuance of common stock	$ 1,000
Aggregate percentage of cumulative, non-compounded, annual return on the original issue price added to total distributions qualifying for conversion of stock		6.00%
Convertible stock redemption price (in dollars per share)		$ 1.00
Convertible stock, percentage applied to the excess of enterprise value, including distributions to date		15.00%
Private Placement [Member]
Class of Stock [Line Items]
Issuance of common stock (in shares)		1,000
Issuance of common stock		$ 1,000

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Stockholders' Equity - Narrative - Preferred Stock (Details)	3 Months Ended
	Mar. 31, 2019 class shares	Dec. 31, 2018 shares
Equity [Abstract]
Preferred stock, number of classes or series the Board of Directors is authorized to classify or reclassify | class	1
Preferred stock, number of classes or series the Board of Directors is authorized to issue | class	1
Preferred stock, shares outstanding (in shares) | shares	0	0
Preferred stock, shares issued (in shares) | shares	0	0

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Stockholders' Equity - Distribution Reinvestment Plan (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 12, 2019	Dec. 31, 2018	Mar. 14, 2018	Feb. 14, 2017	Dec. 30, 2013
Common Stock [Member]
Class of Stock [Line Items]
Share price (in dollars per share)	$ 15.00
Distribution Reinvestment Plan [Member]
Class of Stock [Line Items]
Share price (in dollars per share)		$ 15.84		$ 15.18	$ 14.85
Sales commissions or dealer manager fees payable on shares sold under the plan	$ 0
Notice period for termination of plan	10 days
Distribution Reinvestment Plan [Member] | Common Stock [Member]
Class of Stock [Line Items]
Share price (in dollars per share)		$ 15.84	$ 15.84			$ 14.25

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Stockholders' Equity - Narrative - Share Repurchase Plan and Redeemable Common Stock (Details)		3 Months Ended
	Mar. 14, 2018 USD ($) $ / shares	Mar. 31, 2019 USD ($) asset $ / shares shares	Mar. 31, 2018 USD ($) shares	Mar. 12, 2019 $ / shares	Dec. 31, 2018 $ / shares	Feb. 14, 2017 $ / shares	Dec. 30, 2013 $ / shares
Class of Stock [Line Items]
Limit on repurchase, percent	93.00%
Authorized repurchase amount, per quarter	$ 2,000,000
Estimated share price (in dollars per share) | $ / shares	$ 14.73
Transfers From (To) Redeemable Common Stock			$ (37,028,102)
Common Stock [Member]
Class of Stock [Line Items]
Share price (in dollars per share) | $ / shares		$ 15.00
Share Repurchase Plan [Member]
Class of Stock [Line Items]
Number of company assets sold that constitute a return of capital as a result of such sale. | asset		1
Written request period for repurchase of shares		15 days
Payment period following the repurchase date for honoring repurchase requests		30 days
Minimum number of days prior to repurchase date a repurchase request may be withdrawn		3 days
Notice period for amendment, suspension, or termination of share repurchase plan.		30 days
Share Repurchase Plan [Member] | Common Stock [Member]
Class of Stock [Line Items]
Number of shares that can be repurchased under Company's share repurchase plan after first anniversary of date of purchase of shares (in shares) | shares		0
Share repurchase plan, maximum period of time allowed from date of death or disability of shareholder to request holding period exemption for shares to be repurchased		2 years
Limit on repurchase, percent		5.00%
Shares redeemed (in shares) | shares		138,961	202,170
Stock requested for redemption (in shares) | shares		440,908	309,952
Stock requested for redemption, amount		$ 6,413,834	$ 4,262,726
Shares of outstanding and unfulfilled redemption requests (in shares) | shares		1,589,499.2583
Fee charged to repurchase shares		$ 0
Value of stock redeemed		$ 2,000,000	2,886,216
Transfers From (To) Redeemable Common Stock			(37,028,102)
Share Repurchase Plan As Amended [Member] | Common Stock [Member]
Class of Stock [Line Items]
Holding period of shares repurchased		1 year
Accounts Payable and Accrued Liabilities [Member] | Share Repurchase Plan [Member] | Common Stock [Member]
Class of Stock [Line Items]
Stock requested for redemption, amount		$ 23,205,024	$ 4,262,726
Distribution Reinvestment Plan [Member]
Class of Stock [Line Items]
Share price (in dollars per share) | $ / shares	$ 15.18			$ 15.84		$ 14.85
Distribution Reinvestment Plan [Member] | Common Stock [Member]
Class of Stock [Line Items]
Share price (in dollars per share) | $ / shares				$ 15.84	$ 15.84		$ 14.25

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Stockholders' Equity - Schedule of Share Repurchase Plan Prior to Estimated Value Per Share of Common Stock is Published (Details) - Share Repurchase Plan Pre-published Valuation [Member] - Common Stock [Member]	Mar. 29, 2016
Class of Stock [Line Items]
Less than 1 year	0.00%
1 year	92.50%
2 years	95.00%
3 years	97.50%
4 years	100.00%

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Stockholders' Equity - Schedule of Share Repurchase Plan Following Estimated Value Per Share of Common Stock is Published (Details) - Share Repurchase Plan Post Published Valuation [Member] - Common Stock [Member]	Mar. 30, 2016
Class of Stock [Line Items]
Less than 1 year	0.00%
1 year	92.50%
2 years	95.00%
3 years	97.50%
4 years	100.00%

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Stockholders' Equity - Narrative - Distributions Declared (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Mar. 12, 2019	Dec. 31, 2018	Mar. 14, 2018	Feb. 14, 2017	Dec. 30, 2013
Class of Stock [Line Items]
Distributions declared	$ 11,511,537	$ 11,312,463
Distributions payable	$ 3,970,014			$ 3,953,499
Common Stock [Member]
Class of Stock [Line Items]
Common stock distribution rate percentage	6.00%
Share price (in dollars per share)	$ 15.00
Distributions declared	$ 11,511,537	11,312,463
Dividends, common stock, distribution reinvestment plan	$ 5,343,926	$ 5,671,096
Dividends, common stock, distribution reinvestment plan (in shares)	352,037	381,892
Distributions payable	$ 3,970,014			$ 3,953,499
Dividends payable	$ 1,826,188	$ 1,860,828
Dividends payable (in shares)	120,302	122,584
Distribution Reinvestment Plan [Member]
Class of Stock [Line Items]
Share price (in dollars per share)			$ 15.84		$ 15.18	$ 14.85
Distribution Reinvestment Plan [Member] | Common Stock [Member]
Class of Stock [Line Items]
Share price (in dollars per share)			$ 15.84	$ 15.84			$ 14.25

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Stockholders' Equity - Narrative - Distributions Paid (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018
Equity [Abstract]
Payments of ordinary dividends, common stock	$ 6,116,456	$ 5,597,521
Stock issued during period, dividend reinvestment plan (in shares)	354,319	383,908
Proceeds from issuance of common stock, dividend reinvestment plan	$ 5,378,566	$ 5,701,030
Distributions paid, common stock, including distribution reinvestment plan	$ 11,495,022	$ 11,298,551

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Related Party Arrangements - Schedule of Amounts Attributable to the Advisor and its Affiliates - Amounts Incurred and Payable (Details) - Advisor [Member] - Advisor and its Affiliates [Member] - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Related Party Transaction [Line Items]
Incurred in the period	$ 10,906,654	$ 10,407,522
Amount payable	1,959,468		$ 1,534,595
Acquisition Fees and Expenses [Member]
Related Party Transaction [Line Items]
Incurred in the period	64,235	0
Amount payable	0		1,607
Prepaid Insurance [Member]
Related Party Transaction [Line Items]
Incurred in the period	282,315	379,094
Amount payable	102,677		101,573
Rental Revenue [Member]
Related Party Transaction [Line Items]
Incurred in the period	(14,745)	0
Amount payable	0		0
Capital Expenditures [Member]
Related Party Transaction [Line Items]
Incurred in the period	0	5,622
Amount payable	0		0
Construction Management Fees [Member]
Related Party Transaction [Line Items]
Incurred in the period	157,899	136,443
Amount payable	21,282		10,281
Construction Management Reimbursement [Member]
Related Party Transaction [Line Items]
Incurred in the period	150,360	232,591
Amount payable	25,841		29,203
Sales Commissions Paid [Member] | Additional Paid-in Capital [Member]
Related Party Transaction [Line Items]
Incurred in the period	0	0
Amount payable	244,301		299,952
Fees to Affiliates [Member] | Investment Management Fees [Member]
Related Party Transaction [Line Items]
Incurred in the period	4,160,152	4,262,253
Amount payable	5,120		55,865
Fees to Affiliates [Member] | Property Management, Fees [Member]
Related Party Transaction [Line Items]
Incurred in the period	1,234,277	1,191,167
Amount payable	414,625		410,424
Fees to Affiliates [Member] | Property Management, Other Fees [Member]
Related Party Transaction [Line Items]
Incurred in the period	671,219	343,258
Amount payable	39,046		41,989
Fees to Affiliates [Member] | Property Management, Other Fees - Property Operations [Member]
Related Party Transaction [Line Items]
Incurred in the period	23,142	23,649
Amount payable	0		0
Operating, Maintenance and Management [Member] | Property Management, Reimbursement of Onsite Personnel [Member]
Related Party Transaction [Line Items]
Incurred in the period	3,727,705	3,562,735
Amount payable	956,003		768,107
General and Administrative Expense [Member] | Property Management, Other Fees - General and Administrative [Member]
Related Party Transaction [Line Items]
Incurred in the period	34,987	9,299
Amount payable	0		0
General and Administrative Expense [Member] | Other Operating Expenses [Member]
Related Party Transaction [Line Items]
Incurred in the period	415,108	261,411
Amount payable	355,927		93,740
General and Administrative Expense [Member] | Insurance Proceeds [Member]
Related Party Transaction [Line Items]
Incurred in the period	0	$ 0
Amount payable	$ 0		$ 75,000

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Related Party Arrangements - Narrative - Organization and Offering Costs (Details) - Advisor [Member] - Advisor and its Affiliates [Member] - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Related Party Transaction [Line Items]
Amount payable	$ 1,959,468		$ 1,534,595
Incurred in the period	$ 10,906,654	$ 10,407,522

XML

Related Party Arrangements - Narrative - Investment Management Fee (Details)	1 Months Ended	3 Months Ended
	Dec. 31, 2014	Mar. 31, 2019
Advisor [Member] | Investment Management Fee [Member]
Related Party Transaction [Line Items]
Investment management fees	0.0417%	0.0833%

XML

Related Party Arrangements - Narrative - Acquisition Fees and Expenses (Details) - Advisor [Member] - Advisor [Member] - Acquisition Fees and Expenses [Member]	3 Months Ended
	Mar. 31, 2019
Related Party Transaction [Line Items]
Acquisition fee, percent	1.00%
Acquisition fee payable without board approval as a percent of total contract price	4.50%

XML

Related Party Arrangements - Narrative - Loan Coordination Fee (Details) - Advisor [Member] - Advisor [Member] - Loan Coordination Fee [Member]	3 Months Ended
	Mar. 31, 2019
Related Party Transaction [Line Items]
Loan coordination fee, acquisitions	1.00%
Loan coordination fee, other than acquisitions	0.75%

XML

Related Party Arrangements - Narrative - Property Management Fees and Expenses (Details) - Property Management Fees and Expenses [Member] - Steadfast Management Company [Member] - Property Manager [Member]	3 Months Ended
	Mar. 31, 2019
Related Party Transaction [Line Items]
Related Party Agreement, Term of Agreement	1 year
Property Management Agreement, Number of Days Prior Notice is Needed to Terminate Agreement	60 days
Property Management Agreement, Number of Days of Uncured Breach Prior to Termination of Agreement	30 days
Minimum [Member]
Related Party Transaction [Line Items]
Property management fee, percent fee	2.50%
Maximum [Member]
Related Party Transaction [Line Items]
Property management fee, percent fee	3.00%

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Related Party Arrangements - Narrative - Construction Management Fee (Details) - Pacific Coast Land & Construction, Inc. [Member] - Affiliated Entity [Member] - Construction Management Fee [Member]	3 Months Ended
	Mar. 31, 2019
Related Party Transaction [Line Items]
Construction management agreement, notice of termination of contract, period	30 days
Minimum [Member]
Related Party Transaction [Line Items]
Construction management fee, percent	8.00%
Maximum [Member]
Related Party Transaction [Line Items]
Construction management fee, percent	12.00%

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Related Party Arrangements - Narrative - Other Operating Expense Reimbursements (Details) - Advisor [Member] - Advisor [Member] - Other Operating Expense Reimbursement [Member]	3 Months Ended
	Mar. 31, 2019 quarter
Operating Expenses
Operating expense limitation, number of rolling quarters	4
Operating expenses limitation as a percentage of average invested assets	2.00%
Operating expenses limitation as a percentage of net income	25.00%
Average invested assets, calculation period	12 months

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Related Party Arrangements - Narrative - Disposition Fee (Details) - Advisor [Member] - Advisor [Member] - Disposition Fee [Member]	3 Months Ended
	Mar. 31, 2019 USD ($)
Related Party Transaction [Line Items]
Disposition fee, maximum percent of brokerage commission paid threshold	50.00%
Property sale disposition fee, maximum percentage of total sale price	1.00%
Operating expenses limitation as a percentage of average invested assets	2.00%
Operating expenses limitation as a percentage of net income	25.00%
Disposition fees incurred	$ 0

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Related Party Arrangements - Narrative - Selling Commissions and Dealer Manager Fees (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Dec. 31, 2018
Steadfast Capital Markets Group, LLC [Member] | Dealer Manager [Member] | Sales Commissions [Member] | Primary Offering [Member]
Related Party Transaction [Line Items]
Sales commission, percentage of gross offering proceeds	7.00%
Initial payment, percent	3.00%
Remaining payment, percent	4.00%
Selling Commissions on Gross Offering Proceeds from Sales of Common Stock, Remaining Payment, Annual, Percent	1.00%
selling commissions on gross offering proceeds from sales of common stock	P4Y
Steadfast Capital Markets Group, LLC [Member] | Dealer Manager [Member] | Dealer Manager Fees [Member] | Primary Offering [Member]
Related Party Transaction [Line Items]
Dealer manager fees, percentage of gross offering proceeds	3.00%
Steadfast Capital Markets Group, LLC [Member] | Dealer Manager [Member] | Sales Commissions and Dealer Manager Fees [Member] | Distribution Reinvestment Plan [Member]
Related Party Transaction [Line Items]
Sales commissions or dealer manager fees paid	$ 0
Advisor [Member] | Advisor and its Affiliates [Member]
Related Party Transaction [Line Items]
Amount payable	1,959,468	$ 1,534,595
Additional Paid-in Capital [Member] | Advisor [Member] | Advisor and its Affiliates [Member] | Sales Commissions Paid [Member]
Related Party Transaction [Line Items]
Amount payable	$ 244,301	$ 299,952

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Incentive Award Plan and Independent Director Compensation - Narrative (Details) - USD ($)				3 Months Ended
	Aug. 13, 2015	Aug. 07, 2014	Feb. 27, 2014	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Amortization of stock-based compensation				$ 13,896	$ 13,839
Operating expenses				$ 55,125,882	$ 49,385,120
Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)				0	4,998
Common Stock [Member] | Minimum [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Proceeds from issuance of common stock				$ 2,000,000
Common Stock [Member] | Independent Directors Compensation Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Award vesting period	4 years
Amortization of stock-based compensation				13,896	$ 13,839
Director [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Annual retainer				55,000
Annual retainer, additional due audit committee chairperson				10,000
Board Meeting attendance fee				2,500
Committee Meeting attendance fee				1,500
Teleconference attendance fee				1,000
Teleconference attendance fee, daily maximum				$ 4,000
Operating expenses					$ 55,750
Director [Member] | Independent Directors Compensation Plan [Member] | Restricted Stock [Member] | IPO [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares entitled to be received under plan (in shares)				3,333
Shares entitled to be received upon re-election to Board of Directors (in shares)				1,666
Award vesting period				3 years
Shares of restricted common stock, vesting percentage				25.00%
Director Two [Member] | Common Stock [Member] | Independent Directors Compensation Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)	1,666	1,666	3,333
Director Three [Member] | Common Stock [Member] | Independent Directors Compensation Plan [Member] | Restricted Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Shares granted (in shares)	1,666	1,666	3,333
Director [Member] | Director Annual Retainer Expense [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Due to related parties				$ 219,750		$ 151,750

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Derivative Financial Instruments - Schedule of Interest Rate Derivatives (Details) - Interest Rate Cap [Member]	Mar. 31, 2019 USD ($) instrument	Dec. 31, 2018 USD ($) instrument
Derivative [Line Items]
Interest rate derivative assets, at fair value		$ 207,769
Cash Flow Hedging [Member] | Not Designated as Hedging Instrument [Member]
Derivative [Line Items]
Derivative, number of instruments held | instrument	20	22
Notional Amount	$ 667,737,850	$ 713,237,850
Derivative, Average Cap Interest Rate	3.47%	3.46%
Interest rate derivative assets, at fair value	$ 28,153	$ 207,769
Cash Flow Hedging [Member] | Not Designated as Hedging Instrument [Member] | LIBOR [Member]
Derivative [Line Items]
Variable Rate	2.49%	2.52%

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Derivative Financial Instruments - Narrative (Details) - USD ($)	3 Months Ended
	Mar. 31, 2019	Mar. 31, 2018	Dec. 31, 2018
Derivative [Line Items]
Unrealized loss	$ 179,616	$ (447,614)
Interest Rate Cap [Member]
Derivative [Line Items]
Unrealized loss	179,616	(447,614)
Interest rate derivative assets, at fair value			$ 207,769
Interest Rate Cap [Member] | Deferred Financing Costs and Other Assets, Net [Member]
Derivative [Line Items]
Interest rate derivative assets, at fair value	28,153
Interest Expense [Member] | Interest Rate Cap [Member]
Derivative [Line Items]
Unrealized loss	$ 179,616	$ (447,614)

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Subsequent Events - Narrative - Distributions Paid (Details) - USD ($)				3 Months Ended
	May 07, 2019	May 01, 2019	Apr. 01, 2019	Mar. 31, 2019	Mar. 31, 2018
Subsequent Event [Line Items]
Distributions paid, common stock, including distribution reinvestment plan				$ 11,495,022	$ 11,298,551
Payments of ordinary dividends, common stock				6,116,456	5,597,521
Stock Redeemed or Called During Period, Value				$ 2,000,000	$ 2,886,216
Common Stock [Member]
Subsequent Event [Line Items]
Share price (in dollars per share)				$ 15.00
Subsequent Event [Member]
Subsequent Event [Line Items]
Distributions paid, common stock, including distribution reinvestment plan		$ 3,850,493	$ 3,970,014
Common share, distribution rate per share per day, declared (in dollars per share)	$ 0.002466
Subsequent Event [Member] | Dividend Paid [Member]
Subsequent Event [Line Items]
Payments of ordinary dividends, common stock		2,105,481	2,143,826
Distributions paid to common stockholders through common stock issuances pursuant to distribution reinvestment plan		$ 1,745,012	$ 1,826,188