10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

[x]	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2015
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: 333-199129

Inland Residential Properties Trust, Inc.

(Exact name of registrant as specified in its charter)

Maryland	80-0966998
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
2901 Butterfield Road, Oak Brook, Illinois	60523
(Address of principal executive offices)	(Zip Code)

630-218-8000

(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 the filing requirements for the past 90 days. Yes þ No o

The Registrant’s registration statement on Form S-11, as amended (SEC File No. 333-199129), was declared effective February 17, 2015. The Registrant has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act since that date.

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes þ No o

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

Large accelerated filer o Accelerated filer o Non-accelerated filer o Smaller reporting company þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes o No þ

As of November 10, 2015, there were 119,095 shares of the registrant’s Class A common stock, $.001 par value, outstanding.

1 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

		Page
Part I - Financial Information
Item 1.	Financial Statements
	Consolidated Balance Sheets as of September 30, 2015 (unaudited) and December 31, 2014	3
	Consolidated Statements of Operations for the three and nine months ended September 30, 2015 and 2014 (unaudited)	4
	Consolidated Statement of Equity (Deficit) for the nine months ended September 30, 2015 (unaudited)	5
	Consolidated Statements of Cash Flows for the nine months ended September 30, 2015 and 2014 (unaudited)	6
	Notes to Consolidated Financial Statements (unaudited)	8
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	19
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	27
Part II - Other Information
Item 1.	Legal Proceedings	27
Item 1A.	Risk Factors	27
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	30
Item 3.	Defaults Upon Senior Securities	31
Item 4.	Mine Safety Disclosures	31
Item 5.	Other Information	31
Item 6.	Exhibits	31
Signatures		32

2 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

CONSOLIDATED BALANCE SHEETS

	September 30, 2015 (unaudited)			December 31, 2014
ASSETS
Assets:
Real estate:
Land	$	6,301,838		$	—
Building and other improvements		38,824,096			—
Total real estate		45,125,934			—
Cash and cash equivalents		1,689,711			232,635
Acquired in place lease intangibles		601,623			—
Deferred costs, net		136,930			2,614,621
Other assets		351,113			19,867
Total assets	$	47,905,311		$	2,867,123
LIABILITIES AND EQUITY
Liabilities:
Mortgages payable	$	45,750,000		$	—
Accounts payable and accrued expenses		249,363			1,319,477
Due to related parties		4,889,407			1,532,667
Other liabilities		19,727			—
Total liabilities		50,908,497			2,852,144
Commitments and contingencies
Stockholders’ (deficit) equity:
Preferred stock, $.001 par value, 50,000,000 shares authorized,     none outstanding		—			—
Common stock, $.001 par value, 400,000,000 shares authorized,     0 shares and 8,000 shares issued and outstanding at September 30,     2015 and December 31, 2014, respectively		—			8
Class A common stock, $.001 par value, 320,000,000 shares     authorized, 111,058 shares issued and outstanding		111			—
Class T common stock, $.001 par value, 80,000,000 shares     authorized, none outstanding		—			—
Additional paid in capital (net of offering costs of $3,754,008 and $0 as     of September 30, 2015 and December 31, 2014, respectively)		(1,188,254	)		199,992
Retained deficit		(1,815,043	)		(185,021	)
Total stockholders’ (deficit) equity		(3,003,186	)		14,979
Total liabilities and stockholders’ (deficit) equity	$	47,905,311		$	2,867,123

See accompanying notes to consolidated financial statements.

3 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(unaudited)

	Three months ended September 30,				Nine months ended September 30,
	2015		2014		2015		2014
Income:
Rental income	$	10,441	$	—	$	10,441	$	—
Total income		10,441		—		10,441		—
Expenses:
Property operating expenses		1,510		—		1,510		—
General and administrative expenses		143,703		4,679		408,901		10,462
Acquisition related costs		1,207,188		—		1,207,188		—
Business management fee		22,864		—		22,864		—
Total expenses		1,375,265		4,679		1,640,463		10,462
Operating loss		(1,364,824)		(4,679)		(1,630,022)		(10,462)
Net loss	$	(1,364,824)	$	(4,679)	$	(1,630,022)	$	(10,462)
Net loss per common share, basic and diluted	$	(43.30)	$	(0.58)	$	(102.35)	$	(1.31)
Weighted average number of common shares     outstanding, basic and diluted		31,520		8,000		15,926		8,000

See accompanying notes to consolidated financial statements.

4 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

CONSOLIDATED STATEMENT OF EQUITY (DEFICIT)

(unaudited)

	Number of Shares		Common Stock		Additional Paid in Capital			Retained Earnings (Deficit)			Total
Balance at January 1, 2015		8,000	$	8	$	199,992		$	(185,021	)	$	14,979
Proceeds from the offering		103,058		103		2,357,697			—			2,357,800
Offering costs		—		—		(3,754,008	)		—			(3,754,008	)
Discount on shares to related parties						8,065						8,065
Net loss		—		—		—			(1,630,022	)		(1,630,022	)
Balance at September 30, 2015		111,058	$	111	$	(1,188,254	)	$	(1,815,043	)	$	(3,003,186	)

See accompanying notes to consolidated financial statements.

5 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(unaudited)

	Nine months ended September 30,
	2015			2014
OPERATING ACTIVITIES:
Net loss	$	(1,630,022	)	$	(10,462	)
Adjustments to reconcile net loss to net cash used in     operating activities:
Discount on shares issued to related parties		8,065			—
Changes in assets and liabilities:
Accounts payable		(20,924	)		34,394
Due to related parties		704,154			(24,025	)
Other liabilities		18,072			—
Other assets		(79,313	)		—
Net cash flows used in operating activities		(999,968	)		(93	)
INVESTING ACTIVITIES:
Purchase of real estate		(45,986,910	)		—
Net cash flows used in investing activities		(45,986,910	)		—
FINANCING ACTIVITIES:
Proceeds from offering		2,357,800			—
Proceeds from mortgages payable		45,750,000			—
Payment of offering costs		(2,291,290	)		—
Advances from Sponsor		2,650,000			—
Payment of loan costs		(22,556	)		—
Net cash flows provided by financing activities		48,443,954			—
Net increase (decrease) in cash and cash equivalents		1,457,076			(93	)
Cash and cash equivalents at beginning of the period		232,635			500,000
Cash and cash equivalents, at end of period	$	1,689,711		$	499,907

See accompanying notes to consolidated financial statements.

6 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS (continued)

(unaudited)

	Nine months ended September 30,
	2015			2014
SUPPLEMENTAL DISCLOSURES:
In conjunction with the purchase of real estate, the Company acquired assets     and assumed liabilities as follows:
Land	$	6,301,838		$	—
Building and other improvements		37,591,342			—
Furniture, fixtures and equipment		1,232,754			—
Acquired in place lease intangibles		601,623			—
Acquired assets, net		259,353			—
Purchase of real estate	$	45,986,910		$	—
NON-CASH INVESTING AND FINANCING TRANSACTIONS:
Accrued offering costs payable	$	(1,151,904	)	$	(295,958	)

See accompanying notes to consolidated financial statements.

7 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

September 30, 2015

(unaudited)

The accompanying consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”) for interim financial information and with instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all of the information and footnotes required by U.S. GAAP for complete financial statements. Readers of this Quarterly Report should refer to the audited consolidated financial statements of Inland Residential Properties Trust, Inc. (which may be referred to herein as the “Company,” “we,” “us,” or “our”) for the year ended December 31, 2014, which are included in the Company’s 2014 Special Financial Report as certain footnote disclosures contained in such audited consolidated financial statements have been omitted from this Quarterly Report. In the opinion of management, all adjustments (consisting of normal recurring accruals) necessary for the fair presentation have been included in this Quarterly Report.

NOTE 1 - ORGANIZATION

Inland Residential Properties Trust, Inc. was formed on December 19, 2013 to acquire and manage a portfolio of multifamily properties located primarily in the top 100 United States metropolitan statistical areas, which generally contain populations greater than 500,000 people. Effective July 14, 2014, the Company changed its name from “Inland Retail Properties Trust V, Inc.” to “Inland Residential Properties Trust, Inc.” The Company entered into a Business Management Agreement (the “Business Management Agreement”) with Inland Residential Business Manager & Advisor, Inc. (the “Business Manager”), a related party of the Company, to be the Business Manager to the Company.

The Company is authorized to sell up to $1,000,000,000 of shares of common stock which consist of Class A common stock, $.001 par value per share (“Class A Shares”), at a price of $25.00 per share and Class T common stock, $.001 par value per share (“Class T Shares”), at $23.95 per share, in any combination, in an initial “reasonable best efforts” offering (the “Offering”) which commenced on February 17, 2015. The Company is also authorized to issue up to $190,000,000 of Class A and Class T Shares at a per share price of $23.75 and $22.81, respectively, pursuant to the Company’s distribution reinvestment plan (as amended, “DRP”). In addition, the Company declared that each share of common stock that was issued and outstanding immediately prior to the effective date of the amendment of the Company’s charter converted into one Class A Share. As a result, the 8,000 shares of common stock Inland Real Estate Investment Corporation, (the “Sponsor”), owned as of December 31, 2014 were converted into 8,000 Class A Shares. On September 9, 2015, the Company sold 87,680.842 Class A Shares to the Sponsor for an aggregate purchase price of $2,000,000, or $22.81 per share. Giving effect to this sale, as of such date, having raised approximately $2,348,800 in Class A Shares, the Company met its minimum offering requirement and broke escrow in all states, except Ohio, Pennsylvania, Tennessee and Washington.

8 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The Company provides the following programs to facilitate investment in the Company’s shares and to provide limited liquidity for stockholders.

The Company provides stockholders with the option to purchase additional shares from the Company by automatically reinvesting cash distributions through the DRP, subject to certain share ownership restrictions. For participants in the DRP, cash distributions paid on Class A Shares and Class T Shares, as applicable, will be used to purchase Class A Shares and Class T Shares, respectively. Such purchases under the DRP will not be subject to selling commissions, dealer manager fees, distribution and stockholder servicing fees or reimbursement of issuer costs in connection with shares of common stock issued through the DRP and are made initially at a price of $23.75 and $22.81 per Class A Share and Class T Share, respectively. The price is subject to change after the earlier of (1) the change of the public offering price in a public “reasonable best efforts” offering of the Company’s Class A Shares from $25.00 per Class A Share or Class T Shares from $23.95 per Class T Share, as applicable, if there is a change, and (2) termination of all “reasonable best efforts” public offerings of the Company’s Class A Shares or Class T Shares, as applicable. 

The Company may purchase shares under the share repurchase program (as amended, “SRP”), if the Company chooses to repurchase them. Subject to funds being available, the Company will limit the number of shares repurchased during any calendar year to 5% of the number of shares of common stock outstanding on December 31st of the previous calendar year. Funding for the SRP will come from proceeds that the Company receives from the DRP. In the case of repurchases made upon the death of a stockholder or qualifying disability, as defined in the SRP, neither the one year holding period, the limit regarding funds available from the DRP nor the 5% limit will apply. The SRP will immediately terminate if the Company’s shares become listed for trading on a national securities exchange. In addition, the Company’s board of directors, in its sole direction, may, at any time, amend, suspend or terminate the SRP.

The Company intends to elect to be taxed as a real estate investment trust (“REIT”) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), beginning with its taxable year ending December 31, 2015 or the Company’s first year of material operations. In order to maintain the Company’s qualification as a REIT, the Company is required to, among other things, make aggregate annual distributions (other than capital gain dividends) to the Company’s stockholders of at least 90% of the Company’s annual REIT taxable income (which does not equal net income as calculated in accordance with U.S. GAAP) determined without regard to the deduction for dividends paid and excluding net capital gain, and meet certain tests regarding the nature of the Company’s income and assets.

If the Company qualifies for taxation as a REIT, the Company generally will not be subject to U.S. federal income tax to the extent it meets certain criteria and distributes its REIT taxable income to its stockholders. Even if the Company qualifies for taxation as a REIT, the Company may be subject to (1) certain state and local taxes on its income, property or net worth, and (2) U.S. federal income and excise taxes on its undistributed income, if any income remains undistributed. The Company intends to operate in a manner that allows the Company to meet the requirements for taxation as a REIT, including creating taxable REIT subsidiaries to hold assets that generate income that would not be consistent with the rules applicable to qualification as a REIT if held directly by the REIT. If the Company were to fail to meet these requirements, it could be subject to U.S. federal income tax on the Company’s taxable income at regular corporate rates. The Company would not be able to deduct distributions paid to stockholders in any year in which it fails to qualify as a REIT. The Company will also be disqualified for the four taxable years following the year during which qualification was lost unless the Company is entitled to relief under specific statutory provisions.

9 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General

The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

Consolidation

The accompanying consolidated financial statements include the accounts of the Company, as well as Inland Residential Operating Partnership, L.P., of which the Company is the sole general partner, and the accounts of the Company’s wholly owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation.

Partially-Owned Entities

The Company will consolidate the operations of a joint venture if the Company determines that it is either the primary beneficiary of a variable interest entity or “VIE” or has substantial influence and control of the entity. The primary beneficiary is the party that has the ability to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses and right to receive the returns from the VIE that would be significant to the VIE. There are significant judgments and estimates involved in determining the primary beneficiary of a VIE or the determination of who has control and influence of the entity. When the Company consolidates an entity, the assets, liabilities and results of operations will be included in the Company’s consolidated financial statements.

In instances where the Company determines that it is not the primary beneficiary of a VIE or the Company does not control the joint venture but can exercise influence over the entity with respect to its operations and major decisions, the Company will use the equity method of accounting. Under the equity method, the operations of a joint venture will not be consolidated with the Company’s operations but instead its share of operations will be reflected as equity in earnings (loss) on unconsolidated entity on the Company’s consolidated statements of operations. Additionally, the Company’s net investment in the joint venture will be reflected as investment in unconsolidated entity on the consolidated balance sheets.

Offering and Organization Costs

Costs associated with the Offering are deferred and charged against the gross proceeds of the Offering upon the sale of shares. Formation and organizational costs were expensed as incurred. Deferred Offering costs were $2,614,621 at December 31, 2014 and are included in deferred costs, net in the accompanying consolidated financial statements.

10 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Cash and Cash Equivalents

The Company considers all demand deposits, money market accounts and all short term investments with a maturity of three months or less, at the date of purchase, to be cash equivalents. The Company maintains its cash and cash equivalents at financial institutions. The account balance may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes that the risk will not be significant, as the Company does not anticipate the financial institutions’ non-performance.

Acquisitions

Upon acquisition, the Company determines the total purchase price of each property (see Note 4 – “Acquisitions”), which includes the estimated contingent consideration to be paid or received in future periods, if any. The Company allocates the total purchase price of properties based on the fair value of the tangible and intangible assets acquired and liabilities assumed based on Level 3 inputs, such as comparable sales values, discount rates, capitalization rates, revenue and expense growth rates and lease-up assumptions, from a third party appraisal or other market sources. Such tangible assets include land, building improvements, furniture, fixtures and equipment and such intangible assets include acquired above market and below market leases, in place lease value and any assumed financing that is determined to be above or below market terms.

The Company expenses acquisition costs of all transactions as incurred. All costs related to finding, analyzing and negotiating a transaction are expensed as incurred as acquisition related costs, whether or not the acquisition is completed. These expenses include acquisition fees paid to the Business Manager.

Impairment

The Company assesses the carrying values of the respective long-lived assets, whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable. If it is determined that the carrying value is not recoverable because the undiscounted cash flows do not exceed the carrying value, the Company will be required to record an impairment loss to the extent that the carrying value exceeds fair value. The valuation and possible subsequent impairment of real estate properties will be a significant estimate that can change based on the Company’s continuous process of analyzing each property and reviewing assumptions about inherently uncertain factors, as well as the economic condition of the property at a particular point in time.

Cost Capitalization and Depreciation Policies

Real estate acquisitions are recorded at cost less accumulated depreciation. Improvements and betterment costs will be capitalized and ordinary repairs and maintenance will be expensed as incurred.

11 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Depreciation expense is computed using the straight-line method. Buildings and improvements are depreciated on a straight-line basis based upon estimated useful lives of thirty years for buildings and improvements, and five to fifteen years for furniture, fixtures and equipment and site improvements. Loan fees are amortized on a straight-line basis, which approximates the effective interest method, over the life of the related loan as a component of interest expense. The portion of the purchase price allocated to acquired above market lease costs and acquired below market lease costs is amortized on a straight-line basis over the life of the related lease (including renewal periods for below market leases with fixed rate renewals) as an adjustment to net rental income. Acquired in-place lease costs and other leasing costs are amortized on a straight-line basis over the weighted-average remaining lease term as a component of amortization expense.

Cost capitalization and the estimate of useful lives require judgment and include significant estimates that can and do change.

Fair Value Measurements

The Company estimates fair value using available market information and valuation methodologies it believes to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they will not necessarily be indicative of amounts that would be realized upon disposition.

The Company defines fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company has established a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy will consist of three broad levels, which are described below:

▪	Level 1 −	Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
▪	Level 2 −	Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
▪	Level 3 −	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

12 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

Revenue Recognition

Rental income attributable to leases is recorded on a straight-line basis, which is not materially different than if it were recorded when due from residents, and recognized monthly as it was earned. Leases entered into between a resident and a property for the rental of an apartment unit will generally be year-to-year, renewable upon consent of both parties. Retail/commercial leases will generally have five to ten year lease terms with market based renewal options. 

Valuation of Accounts and Rents Receivable

The Company takes into consideration certain factors that require judgments to be made as to the collectability of receivables. Collectability factors taken into consideration are the amounts outstanding, payment history and financial strength of the tenant, which taken as a whole determines the valuation.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. A valuation allowance is established for uncertainties relating to realization of deferred tax assets. At September 30, 2015 and December 31, 2014, the Company had a deferred tax asset of approximately $726,017 and $74,000, respectively, for which a valuation allowance was recorded in the same amount due to the uncertainty of realization.

Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, Business Combinations - Simplifying the Accounting for Measurement-Period Adjustments. The amendments in the ASU eliminate the requirement of an acquirer to retrospectively account for provisional amounts that are identified during the measurement period after a business combination. This ASU requires an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The ASU also requires the acquirer to disclose the amount recorded in current-period earnings, by line item, that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The ASU is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been issued and will be applied prospectively to adjustments to provisional amounts that occur after the effective date. The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The ASU requires that debt issuance costs be deducted from the carrying value of the financial liability and not recorded as separate assets, classified as deferred financing costs. The ASU is effective for public entities for financial statements issued for fiscal years beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued and will be applied on a retrospective basis. The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

13 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective, although it will not affect the accounting for rental related revenues. The new standard is effective for the Company on January 1, 2018. Early adoption is permitted but not prior to the original effective date of January 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU No. 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

NOTE 3 – INCOME TAX

The Company had no uncertain tax positions as of September 30, 2015. The Company expects no significant increases in uncertain tax positions due to changes in tax positions within one year of September 30, 2015. The Company has no interest or penalties relating to income taxes recognized in the consolidated statements of operations for the three and nine months ended September 30, 2015 and 2014. As of September 30, 2015, the tax returns for the calendar years 2014 and 2013 remain subject to examination by U.S. and various state and local tax jurisdictions.

NOTE 4 - ACQUISITIONS

2015 Acquisitions

Date Acquired	Property Name	Location	Total Number of Units	Square Footage		Purchase Price
9/30/15	The Retreat at Market Square	Frederick, MD	206		194,732	$	45,727,557

During the nine months ended September 30, 2015, the Company acquired, through its wholly owned subsidiary, the real estate property above by borrowing $45,750,000 in mortgage debt that is secured by a first priority mortgage on the property.

For properties acquired during the nine months ended September 30, 2015, the Company recorded revenue of $10,441 and property net income of $8,931 which excludes expensed acquisition related costs.

The Company incurred $1,207,188 and $0 during the three months ended September 30, 2015 and 2014, respectively, and $1,207,188 and $0 during the nine months ended September 30, 2015 and 2014, respectively, of acquisition, dead deal and transaction related costs. These costs include third party due diligence costs such as appraisals, environmental studies, and legal fees as well as acquisition fees and time and travel expense reimbursements to the Sponsor and its affiliates.

14 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table presents certain additional information regarding the Company’s acquisition during the nine months ended September 30, 2015. The amounts recognized for major assets acquired as of the acquisition date are as follows:

Property Name	Land		Building and Improvements		Furniture, Fixtures and Equipment		Acquired Lease Intangibles
The Retreat at Market Square	$	6,301,838	$	37,591,342	$	1,232,754	$	601,623

Pro Forma Disclosures

The following condensed pro forma consolidated financial statements for the three and nine months ended September 30, 2015 and 2014 include pro forma adjustments related to the acquisition and financing during 2015. The 2015 acquisition is presented assuming the acquisition occurred on January 1, 2014. Acquisition expenses for both the three and nine months ended September 30, 2015 of $1,207,188, related to the acquisition, are not expected to have a continuing impact and, therefore, have been excluded from these pro forma results.

	Three months ended September 30,						Nine months ended September 30,
	2015			2014			2015			2014
Pro forma total income	$	942,215		$	382,621		$	2,630,318		$	593,608
Pro forma net loss	$	(575,275	)	$	(921,691	)	$	(1,649,628	)	$	(3,215,658	)
Loss per share	$	(5.18	)	$	(8.30	)	$	(14.85	)	$	(28.95	)

NOTE 5 – MORTGAGES PAYABLE

As of September 30, 2015, the Company’s mortgage loan is secured by a first mortgage on the property.

Property Name	Stated Interest Rate Per Annum	Principal Balance at September 30, 2015		Principal Balance at December 31, 2014		Maturity Date	Notes
The Retreat at Market Square	3.95%	$	45,750,000	$	—	September 30, 2016	(a)

(a) The loan requires monthly payments of interest only until the maturity date. Subject to certain conditions, the Company has a one-time option to extend the maturity date for an additional seven year period to September 30, 2023. If extended, the mortgage loan would bear interest at a fixed rate equal to 3.79%. During the initial one-year term of the loan, the Sponsor has agreed to guarantee the payment of (i) all real estate taxes on the property which accrue or become due during the term of the loan, (ii) all Costs and Expenses, as defined, and (iii) any and all losses, damages, costs or expenses of the lender, which arise in consequence of certain events, as defined, provided that the guaranteed obligation will be limited to the payment of $9,150,000, plus enforcement costs. The Company has not paid, and will not pay, any fees or other consideration to the Sponsor for this guarantee.

15 

INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

NOTE 6 – SEGMENT REPORTING

The Company has one reportable segment, multifamily real estate, as defined by U.S. GAAP for the nine months ended September 30, 2015 and 2014.

NOTE 7 – TRANSACTIONS WITH RELATED PARTIES

The Sponsor contributed $200,000 to the capital of the Company for which it received 8,000 shares of common stock which were subsequently converted into 8,000 shares of Class A common stock. On September 9, 2015, the Company sold 87,680.842 shares of Class A common stock to the Sponsor for an aggregate purchase price of $2,000,000, or $22.81 per share.

Since inception, the Sponsor has advanced $2,950,000 in cash to the Company, which is included in due to related parties on the accompanying consolidated balance sheets, to partially fund formation, offering and organization costs.

As of September 30, 2015, the Company had incurred $3,817,104 of offering and organization costs. Pursuant to the terms of the Offering, the Business Manager will repay all offering and organization expenses (excluding selling commissions) in excess of 2.0% of the gross proceeds of the Offering or all offering and organization expenses (including selling commissions) which together exceed 10.75% of the gross offering proceeds from Class A Shares and 6.75% of the gross offering proceeds from Class T Shares, sold in the primary offering over the life of the Offering.

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INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

The following table summarizes the Company’s related party transactions for the three and nine months ended September 30, 2015 and 2014 and as of September 30, 2015 and December 31, 2014.

		Three months ended September 30,				Nine months ended September 30,				Amount Unpaid as of
		2015		2014		2015		2014		September 30, 2015		December 31, 2014
General and administrative expenses	(a)	$	61,168	$	—	$	147,548	$	—	$	81,253	$	95,289
Organization costs	(b)		—		225		—		1,610		—		—
Acquisition related costs	(c)		719,148		—		719,148		—		686,250		—
Offering costs	(d)		25,278		57,413		145,958		71,603		1,034,665		1,137,378
Business management fee	(e)		22,864		—		22,864		—		22,864		—
Mortgage financing fee	(f)		114,375		—		114,375		—		114,375		—
Sponsor non-interest bearing advances	(g)		450,000		—		2,650,000		—		2,950,000		300,000

(a)	The Business Manager and its affiliates are entitled to reimbursement for certain general and administrative expenses relating to the Company’s administration. Such costs are included in general and administrative expenses in the accompanying consolidated statements of operations. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. The Company established a discount stock purchase policy for related parties that enables them to purchase shares of common stock at $22.81 per share. The Company sold 3,683 shares to related parties during the nine months ended September 30, 2015.
(b)	The Business Manager or its affiliates will pay or reimburse any organization or offering costs, including any issuer costs, that exceed 10.75% of the gross offering proceeds from Class A Shares, and 6.75% of the gross offering proceeds from Class T Shares sold in the “reasonable best efforts” offering over the life of the Offering.
(c)	The Company pays the Business Manager or its affiliates a fee equal to 1.5% of the “contract purchase price,” as defined, of each property and real estate-related asset acquired.  The Business Manager and its affiliates are also reimbursed for acquisition and transaction related costs of the Business Manager and its affiliates relating to the Company’s acquisition of real estate assets, regardless of whether the Company acquires the real estate assets, subject to limits, as defined.  Such costs are included in acquisition related costs in the accompanying consolidated statements of operations.  Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets.
(d)	The Company reimburses the Sponsor and its affiliates for costs and other expenses of the Offering that they pay on the Company’s behalf.  Offering costs are offset against the stockholders’ equity accounts. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. An affiliate of the Business Manager also receives selling commissions equal to 6.0% of the sale price for each Class A Share sold and 2.0% of the sale price for each Class T Share sold and a dealer manager fee equal to 2.75% of the sale price for each share sold, the majority of which is re-allowed (paid) to third party soliciting dealers. The Company does not pay selling commissions or the dealer manager fee in connection with shares issued through the DRP.
(e)	The Company pays the Business Manager an annual business management fee equal to 0.6% of its “average invested assets,” payable quarterly in an amount equal to 0.15% of the Company’s average invested assets as of the last day of the immediately preceding quarter. “Average invested assets” means, for any period, the average of the aggregate book value of the Company’s assets, including all intangibles and goodwill, invested, directly or indirectly, in equity interests in, and loans secured by, properties, as well as amounts invested in securities or consolidated and unconsolidated joint ventures or other partnerships, before reserves for amortization and depreciation or bad debts, impairments or other similar non-cash reserves, computed by taking the average of these values at the end of each month during the relevant calendar quarter.
(f)	The Company pays the Business Manager, or its affiliates, a mortgage financing fee equal to 0.25% of the amount available or borrowed under the financing or the assumed debt if the Business Manager or its affiliates provides services in connection with the origination or refinancing of any debt that the Company obtains and uses to finance properties or other assets, or that is assumed, directly or indirectly, in connection with the acquisition of properties or other assets.
(g)	This amount on the accompanying consolidated balance sheets contains non-interest bearing advances made by the Sponsor which the Company intends to repay.

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INLAND RESIDENTIAL PROPERTIES TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (continued)

(unaudited)

NOTE 8 – SUBSEQUENT EVENTS

On October 20, 2015, the Company’s board of directors authorized a daily cash dividend of $0.003424658 per Class A Share and $0.002768493 per Class T Share, payable to stockholders of record each day beginning on the close of business on November 1, 2015 through the close of business on November 30, 2015.

In addition, on October 20, 2015, the Company’s board of directors authorized a monthly stock dividend of 0.000833333 Class A Shares per Class A Share owned and 0.000833333 Class T Shares per Class T Share owned, payable to stockholders of record at the close of business on November 30, 2015.

Distributions declared for the month of November will be paid and distributed no later than December 7, 2015.

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Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations

Certain statements in this Quarterly Report on Form 10-Q constitute “forward-looking statements” within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Words such as “may,” “could,” “should,” “expect,” “intend,” “plan,” “goal,” “seek,” “anticipate,” “believe,” “estimate,” “predict,” “variables,” “potential,” “continue,” “expand,” “maintain,” “create,” “strategies,” “likely,” “will,” “would” and variations of these terms and similar expressions, or the negative of these terms or similar expressions, are intended to identify forward-looking statements.

These forward-looking statements are not historical facts but reflect the intent, belief or current expectations of the management of Inland Residential Properties Trust, Inc. (which we refer to herein as the “Company,” “we,” “our” or “us”) based on their knowledge and understanding of the business and industry, the economy and other future conditions. These statements are not guarantees of future performance, and we caution stockholders not to place undue reliance on forward-looking statements. Actual results may differ materially from those expressed or forecasted in the forward-looking statements due to a variety of risks, uncertainties and other factors, including but not limited to the factors listed and described under “Risk Factors” in our Registration Statement on Form S-11 (File No. 333-199129), as amended, filed with the Securities and Exchange Commission, and factors described below:

•  No public market for our shares currently exists and one may never exist, and our stockholders may not be able to sell their shares under our share repurchase program (as amended, “SRP”) and, if our stockholders are able to sell their shares under the program, they may not be able to recover the amount of their investment in our shares;

•   Our board does not have any current plans to list our shares or pursue any other liquidity event, and we cannot guarantee that a liquidity event will occur;

•   We cannot guarantee that we will pay distributions but, if we do, we may pay all or a substantial portion of our distributions from sources other than cash flow from operations, including an unlimited amount of borrowings and net offering proceeds. We have not limited our use of any of these other sources. Payments of distributions from sources other than cash flows from operations reduce the amount of capital we ultimately invest in real estate assets;

•  The interest of later investors in our common stock will be diluted as a result of our payment of stock dividends that have been declared and will be further diluted if we make additional stock dividends;

• We may not be able to raise capital sufficient to achieve our investment objectives;

• We have a limited operating history and the prior performance of programs sponsored by Inland Real Estate Investment Corporation or our “Sponsor” should not be used to predict our future results;

• The number and value of real estate assets we acquire will depend, in part, on the net proceeds raised in the offering;

• We do not have employees and will rely on Inland Residential Business Manager & Advisor, Inc. or our “Business Manager” and Inland Residential Real Estate Services, LLC or our “Real Estate Manager” to manage our business and assets;

• Persons performing services for our Business Manager and our Real Estate Manager are employed by our Sponsor or its affiliates and will face competing demands for their time and service;

• We do not have arm’s-length agreements with our Business Manager, Real Estate Manager or other affiliates of our Sponsor;

• Our Sponsor may face a conflict of interest in allocating personnel and resources between its affiliates, our Business Manager and our Real Estate Manager;

• We may suffer from delays in selecting, acquiring and developing suitable assets;

•  We will rely on entities affiliated with our Sponsor to identify real estate assets;

• We will pay fees, which may be significant, to our Business Manager, Real Estate Manager and other affiliates of our Sponsor;

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•  We have not identified all of the specific real estate assets that we will acquire with the net proceeds raised in the offering, thus it is a “blind pool” offering;

•   Principal and interest payments on any borrowings will reduce the funds available for distribution or investment in additional real estate assets;

• There are limits on the ownership and transferability of our shares; and

• We may fail to qualify as a REIT and thus be required to pay entity-level taxes.

Forward-looking statements in this Quarterly Report on Form 10-Q reflect our management’s view only as of the date of this Quarterly Report, and may ultimately prove to be incorrect or false. We undertake no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results. We intend for these forward-looking statements to be covered by the applicable safe harbor provisions created by Section 27A of the Securities Act and Section 21E of the Exchange Act.

The following discussion and analysis relates to the three and nine months ended September 30, 2015 and 2014 and as of September 30, 2015 and December 31, 2014. You should read the following discussion and analysis along with our consolidated financial statements and the related notes included in this report.

Overview

We are an externally managed Maryland corporation formed in December 2013 to acquire and manage a portfolio of multifamily properties located primarily in the top 100 United States metropolitan statistical areas, which generally contain populations greater than 500,000 people. We expect that our real estate portfolio will consist primarily of “stabilized” Class A and Class B multifamily properties. We are managed by our Business Manager.

On February 17, 2015, we commenced our initial public offering, referred to herein as the “Offering”. We are authorized to sell up to $1,000,000,000 of shares of common stock which consist of Class A common stock, $.001 par value per share (“Class A Shares”), at a price of $25.00 per share and Class T common stock, $.001 par value per share (“Class T Shares”), at $23.95 per share, in any combination, on a “reasonable best efforts” basis. We are also authorized to issue up to $190,000,000 of Class A and Class T Shares at a per share price of $23.75 and $22.81, respectively, pursuant to our distribution reinvestment plan (as amended, “DRP”). In addition, we declared that each share of common stock that was issued and outstanding immediately prior to the effective date of the amendment of our charter converted into one issued and outstanding Class A Share. As a result, the 8,000 shares of common stock our Sponsor owned as of December 31, 2014 were converted into 8,000 Class A Shares. On September 9, 2015, we sold 87,680.842 Class A Shares to the Sponsor for an aggregate purchase price of $2 million, or $22.81 per share. Giving effect to this sale, as of such date, having raised approximately $2.35 million in Class A Shares, we met our minimum offering requirement and broke escrow in all states, except Ohio, Pennsylvania, Tennessee and Washington.

We intend to elect to be taxed as a real estate investment trust (“REIT”) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), beginning with our taxable year ending December 31, 2015 or our first year of material operations. In order to maintain our qualification as a REIT, we are required to, among other things, make aggregate annual distributions (other than capital gain dividends) to our stockholders of at least 90% of our annual REIT taxable income (which does not equal net income as calculated in accordance with U.S. GAAP) determined without regard to the deduction for dividends paid and excluding net capital gain, and meet certain tests regarding the nature of our income and assets.

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On September 30, 2015, our wholly owned subsidiary acquired a fee simple interest in a 194,732 square foot 206-unit apartment community located in Frederick, Maryland, for approximately $46.0 million in cash, plus closing costs. The property was constructed in 2014. As of September 30, 2015, the property was 95.2% occupied, with 196 residential units leased. We funded the purchase by obtaining a fixed rate loan in an aggregate principal amount of $45.75 million with an interest rate of 3.95% that is secured by a first priority mortgage on the property. The mortgage loan matures on September 30, 2016.  Subject to certain conditions, we have a one-time option to extend the maturity date for an additional seven year period to September 30, 2023. If extended, the mortgage loan would bear interest at a fixed rate equal to 3.79%. During the initial one-year term of the loan, our Sponsor has agreed to guarantee the payment of (i) all real estate taxes on the property which accrue or become due during the term of the loan, (ii) all Costs and Expenses, as defined, and (iii) any and all losses, damages, costs or expenses of the lender, which arise in consequence of certain events, as defined, provided that the guaranteed obligation will be limited to the payment of $9.15 million, plus enforcement costs.

We expect to pay our Business Manager an acquisition fee equal to 1.5% of the contract purchase price, or approximately $0.7 million.

Liquidity and Capital Resources

General

Our principal demand for funds is to acquire real estate assets, to pay operating and offering expenses, to pay interest on our outstanding indebtedness, to pay distributions to our stockholders and to fund our SRP. We generally seek to fund our cash needs for items other than asset acquisitions and offering costs from operations. Our cash needs for acquisitions will be funded primarily from the sale of our shares, including those offered for sale through our DRP, as well as financing obtained concurrent with an acquisition or in the future.  There may be a delay between the sale of our shares and our purchase of assets, which could result in a delay in generating returns, if any, from our investment operations.  Our Business Manager and Inland Real Estate Acquisitions, Inc. evaluate potential acquisitions and engage in negotiations with sellers and lenders on our behalf.  Pending investment in real estate assets, we may decide to invest proceeds from the Offering in certain investments that could yield lower returns than those earned on real estate assets.

We will generally fund our cash needs for items other than asset acquisitions and capital expenditures from cash flow from operations. We anticipate that adequate cash will be generated from operations to fund our operating and administrative expenses, interest payments on our indebtedness and the payment of distributions. However, our ability to fund operations is subject to some uncertainties. If we have not generated sufficient cash flow from operations, we may fund our cash needs from advances or contributions from our Business Manager or Sponsor or from cash retained by us in the case that our Business Manager defers, accrues or waives all, or a portion, of its business management fees or its right to be reimbursed for certain expenses. We have not limited the amount of monies from any of these sources that may be used to fund cash needs. Neither our Business Manager nor our Sponsor has any obligation to provide us with advances or contributions, and our Business Manager is not obligated to defer, accrue or waive any portion of its business management fee or reimbursements. Further, there is no assurance that these other sources will be available to fund our cash needs.

Potential future sources of capital include proceeds from secured or unsecured financings from banks or other lenders, proceeds from the sale of assets and undistributed funds from operations. If necessary, we may use financings or other sources of capital in the event of unforeseen significant capital expenditures. We have not identified any sources for these types of financings.

Our liquidity needs as of September 30, 2015 and 2014, have been primarily to pay administrative, organizational and offering costs. During the nine months ended September 30, 2015, we purchased a real estate property for approximately $46.0 million. At September 30, 2015 and December 31, 2014, we owed $4.9 million and $1.5 million, respectively, to our Sponsor and its affiliates for advances or unpaid services from these parties. These amounts include non-interest bearing advances by the Sponsor and its affiliates, which we intend to repay.

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As of September 30, 2015, we received net offering proceeds of $2.6 million from the sale of our stock.

Cash Flow Analysis

	For the nine months ended September 30,
	2015			2014
Net cash flows used in operating activities	$	(999,968	)	$	(93	)
Net cash flows used in investing activities	$	(45,986,910	)	$	—
Net cash flows provided by financing activities	$	48,443,954		$	—

Cash used in operating activities was $999,968 and $93 for the nine months ended September 30, 2015 and September 30, 2014, respectively. The increase is due to an increase in acquisition related expenses.

Cash used in investing activities was $45,986,910 and $0 for the nine months ended September 30, 2015 and September 30, 2014, respectively. The increase is due to the purchase of a real estate property on September 30, 2015.

Cash provided by financing activities was $48,443,954 and $0 for the nine months ended September 30, 2015 and 2014, respectively. The increase is due to an increase of $45,750,000 in proceeds from mortgages payable to fund the purchase of a real estate property, an increase of $2,357,800 in offering proceeds and an increase of $2,650,000 for Sponsor advances, offset by $2,291,290 for payment of offering costs and $22,556 for the payment of loan fees.

Results of operations

For the three and nine months ended September 30, 2015 and 2014, operations primarily consisted of acquisition related and general and administrative expenses. At the end of the third quarter, we purchased a real estate property in Frederick, Maryland. We funded the purchase, through our wholly owned subsidiary, by obtaining a loan for $45.75 million that is secured by a first priority mortgage on the property.

As of September 30, 2015, we had not declared or paid distributions.

Critical Accounting Policies

Our accounting policies have been established to conform with U.S. generally accepted accounting principles or “U.S. GAAP.” The preparation of financial statements in conformity with U.S. GAAP requires management to use judgment in the application of accounting policies, including making estimates and assumptions. We consider the policies below to be critical, because they require our management to use judgment in the application of accounting policies, including making estimates and assumptions. These judgments affect the reported amounts of assets and liabilities and 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. If management’s judgment or interpretation of the facts and circumstances relating to various transactions had been different, it is possible that different accounting policies would have been applied, thus resulting in a different presentation of the financial statements. Additionally, other companies may utilize different estimates that may impact comparability of our results of operations to those of companies in similar businesses.

Offering and Organization Costs

Costs associated with the Offering are deferred and charged against the gross proceeds of the Offering upon the sale of shares. Formation and organizational costs were expensed as incurred.

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Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. A valuation allowance is established for uncertainties relating to realization of deferred tax assets.

Acquisitions

Upon acquisition, we determine the total purchase price of each property which includes the estimated contingent consideration to be paid or received in future periods, if any. We allocate the total purchase price of properties based on the fair value of the tangible and intangible assets acquired and liabilities assumed based on Level 3 inputs, such as comparable sales values, discount rates, capitalization rates, revenue and expense growth rates and lease-up assumptions, from a third party appraisal or other market sources. Such tangible assets include land, building improvements, furniture, fixtures and equipment and such intangible assets include acquired above market and below market leases, in place lease value and any assumed financing that is determined to be above or below market terms.

We expense acquisition costs of all transactions as incurred. All costs related to finding, analyzing and negotiating a transaction are expensed as incurred as acquisition related costs, whether or not the acquisition is completed. These expenses include acquisition fees paid to our Business Manager.

Cost Capitalization and Depreciation Policies

Real estate acquisitions are recorded at cost less accumulated depreciation. Improvements and betterment costs will be capitalized and ordinary repairs and maintenance will be expensed as incurred.

Depreciation expense is computed using the straight-line method. Buildings and improvements are depreciated on a straight-line basis based upon estimated useful lives of thirty years for buildings and improvements, and five to fifteen years for furniture, fixtures and equipment and site improvements. Loan fees are amortized on a straight-line basis, which approximates the effective interest method, over the life of the related loan as a component of interest expense. The portion of the purchase price allocated to acquired above market lease costs and acquired below market lease costs is amortized on a straight-line basis over the life of the related lease (including renewal periods for below market leases with fixed rate renewals) as an adjustment to net rental income. Acquired in-place lease costs and other leasing costs are amortized on a straight-line basis over the weighted-average remaining lease term as a component of amortization expense.

Cost capitalization and the estimate of useful lives require judgment and include significant estimates that can and do change.

Fair Value Measurements

We estimate fair value using available market information and valuation methodologies we believe to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they will not necessarily be indicative of amounts that would be realized upon disposition.

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We define fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. We have established a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy will consist of three broad levels, which are described below:

▪	Level 1 −	Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
▪	Level 2 −	Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
▪	Level 3 −	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

Revenue Recognition

Rental income attributable to leases is recorded on a straight-line basis, which is not materially different than if it were recorded when due from residents and recognized monthly as it was earned. Leases entered into between a resident and a property for the rental of an apartment unit will generally be year-to-year, renewable upon consent of both parties. Retail/commercial leases will generally have five to ten year lease terms with market based renewal options.

Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, Business Combinations - Simplifying the Accounting for Measurement-Period Adjustments. The amendments in the ASU eliminate the requirement of an acquirer to retrospectively account for provisional amounts that are identified during the measurement period after a business combination. This ASU requires an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The ASU also requires the acquirer to disclose the amount recorded in current-period earnings, by line item, that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The ASU is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been issued and will be applied prospectively to adjustments to provisional amounts that occur after the effective date. We do not expect adoption of this ASU to have a material impact on our consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The ASU requires that debt issuance costs be deducted from the carrying value of the financial liability and not recorded as separate assets, classified as deferred financing costs. The ASU is effective for public entities for financial statements issued for fiscal years beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued and will be applied on a retrospective basis. We do not expect adoption of this ASU to have a material impact on our consolidated financial statements.

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In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective, although it will not affect the accounting for rental related revenues. The new standard is effective for us on January 1, 2018 with early application permitted but not prior to the original effective date of January 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. We are evaluating the effect that ASU No. 2014-09 will have on our consolidated financial statements and related disclosures. We have not yet selected a transition method nor have we determined the effect of the standard on our ongoing financial reporting.

Share Repurchase Program

The SRP is designed to provide eligible stockholders with limited, interim liquidity by enabling them to sell shares back to us. The terms under which we may repurchase shares may differ between repurchases upon the death or “qualifying disability” of a stockholder or “Exceptional Repurchases” and all other repurchases or “Ordinary Repurchases.” The repurchase price for Ordinary Repurchases is equal to $21.60 per share and $21.61 per share for Class A Shares and Class T Shares, respectively, until the initial valuation date, and thereafter the repurchase price is equal to 96.0% of the most recent applicable estimated value per share reported by us.

In the case of Ordinary Repurchases, we may repurchase shares beneficially owned by a stockholder continuously for at least one year. However, in the event a stockholder is having all of his or her shares repurchased, our board may waive the one-year holding requirement for shares originally purchased under our DRP. We may make Ordinary Repurchases only if we have sufficient funds available to complete the repurchase. In any given calendar month, we are authorized to use only the proceeds from our DRP during that month to make Ordinary Repurchases; provided that, if we have excess funds during any particular month, we may, but are not obligated to, carry those excess funds to the subsequent calendar month for the purpose of making Ordinary Repurchases. Subject to funds being available, in the case of Ordinary Repurchases, we will limit the number of shares repurchased during any calendar year to 5% of the number of Class A Shares and Class T Shares outstanding on December 31st of the previous calendar year. In the event that we determine not to repurchase all of the shares presented during any month, including as a result of having insufficient funds or satisfying the 5% limit, to the extent we decide to repurchase shares, shares will be repurchased on a pro rata basis up to the limits described above. Any stockholder whose Ordinary Repurchase request has been partially accepted in a particular calendar month will have the remainder of his or her request included with all new repurchase requests we have received in the immediately following calendar month, unless he or she chooses to withdraw that request.

In the case of Exceptional Repurchases, with respect to Class A Shares and Class T Shares, we may repurchase shares at a repurchase price equal to $22.50 per share and $22.51 per share for Class A Shares and Class T Shares, respectively, until the initial valuation date, and thereafter the repurchase price is equal to 100.0% of the most recent applicable estimated value per share reported by us. Exceptional Repurchases are not subject to a one-year holding period, or the 5% repurchase limit discussed above, and may be repurchased with funds from any source.

Off-Balance Sheet Arrangements

We currently have no off-balance sheet arrangements that are reasonably likely to have a material current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

25 

Subsequent Events

On October 20, 2015, our board of directors authorized a daily cash dividend of $0.003424658 per Class A Share and $0.002768493 per Class T Share, payable to stockholders of record each day beginning on the close of business on November 1, 2015 through the close of business on November 30, 2015.

In addition, on October 20, 2015, our board of directors authorized a monthly stock dividend of 0.000833333 Class A Shares per Class A Share owned and 0.000833333 Class T Shares per Class T Share owned, payable to stockholders of record at the close of business on November 30, 2015.

Distributions declared for the month of November will be paid and distributed no later than December 7, 2015.

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

We may be exposed to interest rate changes primarily as a result of long-term debt used to purchase properties or other real estate assets, maintain liquidity and fund capital expenditures or operations. We will seek to limit the impact of interest rate changes on earnings and cash flows and to lower our overall borrowing costs.

We may use derivative financial instruments to hedge exposures to changes in interest rates on loans secured by our assets. Derivative instruments may include interest rate swap contracts, interest rate cap or floor contracts, futures or forward contracts, options or repurchase agreements. Our actual hedging decisions will be determined in light of the facts and circumstances existing at the time of the hedge and may differ from our currently anticipated hedging strategy. If we use derivative financial instruments to hedge against interest rate fluctuations, we will be exposed to both credit risk and market 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 because the counterparty may not perform. Market risk is the adverse effect on the value of a financial instrument that results from a change in interest rates. We will seek to manage the market risk associated with interest-rate contracts by establishing and monitoring parameters that limit the types and degree of market risk that may be undertaken. There is no assurance we will be successful.

With regard to variable rate financing, our Business Manager will assess our interest rate cash flow risk by continually identifying and monitoring changes in interest rate exposures that may adversely impact expected future cash flows and by evaluating hedging opportunities. Our Business Manager will maintain risk management control systems to monitor interest rate cash flow risk attributable to both of our outstanding or forecasted debt obligations as well as our potential offsetting hedge positions. While this hedging strategy will be designed to minimize the impact on our net income and funds from operations from changes in interest rates, the overall returns on stockholder investments may be reduced. 

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Item 4.  Controls and Procedures

Controls and Procedures

The Company’s management has evaluated, with the participation of the Company’s principal executive and principal financial officers, the effectiveness of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the period covered by this report. Based on that evaluation, the principal executive and principal financial officers have concluded that the Company’s disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in Internal Control over Financial Reporting

There were no changes to our internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) or Rule 15d-15(f)) during the three months ended September 30, 2015 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

Part II - Other Information

Item 1.  Legal Proceedings

We are not a party to, and none of our properties are subject to, any material pending legal proceedings.

Item 1A.  Risk Factors

The following risk factors supplement the risk factors set forth in our Registration Statement filed on Form S-11.

We have incurred net losses on a U.S. GAAP basis for the quarterly period ended September 30, 2015.

We have incurred a net loss on a U.S. GAAP basis for the three and nine months ended September 30, 2015 of $1.4 million and $1.6 million, respectively. Our losses can be attributed, in part, to acquisition related expenses. We may incur net losses in the future, which could have a material adverse impact on our financial condition, operations, cash flow, and our ability to service our indebtedness and pay distributions to our stockholders. We are subject to all of the business risks and uncertainties associated with any business, including the risk that the value of a stockholder’s investment could decline substantially. We were formed in December 2013 and, as of September 30, 2015, had acquired one residential property. We cannot assure you that, in the future, we will be profitable or that we will realize growth in the value of our assets.

We exceeded the total limit we may borrow as set by our charter which may reduce the funds available for distribution and increase the risk of loss since defaults may cause us to lose the properties securing the loans.

As of September 30, 2015 we had borrowed approximately $45.75 million and had net assets, as defined in our charter, of approximately $(3.6) million. The amount of such borrowing in relation to net assets exceeded the limit set forth in our charter. Notwithstanding the determination by our board that exceeding the limit was justified, there is no assurance that we will not exceed the limit in the future. Borrowing reduces the funds available for, among other things, acquisitions, capital expenditures for existing properties or distributions to our stockholders because cash otherwise available for these purposes is used to pay principal and interest on this debt.

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If there is a shortfall between the cash flow from a property and the cash flow needed to service mortgage debt on a property, then the amount of cash flow from operations available for distributions to stockholders may be reduced. In addition, incurring mortgage debt increases the risk of loss since defaults on indebtedness secured by a property may result in lenders initiating foreclosure actions. In such a case, we could lose the property securing the loan that is in default, thus reducing the value of your investment. For U.S. federal income tax purposes, the foreclosure of a nonrecourse loan generally is treated as a sale of the property or properties for a purchase price equal to the outstanding balance of the debt secured by the property or properties. If the outstanding balance of the debt exceeds our tax basis in the property or properties, we would recognize taxable gain on the foreclosure but would not receive any cash proceeds. We also may fully or partially guarantee any monies that subsidiaries borrow to purchase or operate properties. In these cases, we will likely be responsible to the lender for repaying the loans if the subsidiary is unable to do so. If any mortgage contains cross-collateralization or cross-default provisions, more than one property may be affected by a default.

The failure of any bank in which we deposit our funds could reduce the amount of cash we have available to pay distributions and invest in real estate assets.

We expect to deposit our cash and cash equivalents in several banking institutions in an attempt to minimize exposure to the failure or takeover of any one of these entities. However, the Federal Deposit Insurance Corporation, or FDIC, generally only insures limited amounts per depositor per insured bank. The FDIC insures up to $250,000 per depositor per insured bank for interest-bearing accounts. At September 30, 2015, we had cash and cash equivalents exceeding these federally insured levels. If any of the banking institutions in which we have deposited our funds ultimately fails, we may lose our deposits over the federally insured levels. The loss of our deposits could reduce the amount of cash we have available to distribute or invest.

There is no public market for our shares, and our stockholders may not be able to sell their shares under our share repurchase program and, if our stockholders are able to sell their shares under the program, they may not be able to recover the amount of their investment in our shares.

No public market currently exists, and one may never exist, for our shares. Our board intends to continually evaluate the time and form of a liquidity event or events for our stockholders. There is no assurance, however, that our board will in fact pursue a listing or any other particular type of liquidity event or the timing thereof. In addition, even if our board decides to seek a listing of our shares of common stock, there is no assurance that we will satisfy the listing requirements or that our shares will be approved for listing. Further, our charter limits any person or group from owning or controlling more than 9.8% in value of our outstanding stock, or 9.8% in value or in number (whichever is more restrictive) of each class of our shares, without the prior approval of our board.

Moreover, our amended and restated share repurchase program, which became effective on October 19, 2015, contains numerous restrictions that limit our stockholders’ ability to sell their shares, including those relating to the number of shares of our common stock that we can repurchase at any time and limiting the funds we will use to repurchase shares pursuant to the program. Under the program, as may be amended from time to time, we may make ordinary repurchases, as defined in the plan, from stockholders who have owned their shares continuously for at least a year. The repurchase price will be $21.60 per share and $21.61 per share for Class A Shares and Class T Shares, respectively, until the initial valuation date, and thereafter the repurchase price will be 96.0% of the most recent applicable estimated value per share reported by the Company.

In the case of exceptional repurchases, with respect to Class A Shares and Class T Shares, we may repurchase shares at a repurchase price equal to $22.50 per share and $22.51 per share for Class A Shares and Class T Shares, respectively, until the initial valuation date, and thereafter the repurchase price will be 100.0% of the most recent applicable estimated value per share reported by the Company.

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Notwithstanding the foregoing, the repurchase price of the shares for ordinary repurchases and exceptional repurchases shall never be greater than the then-current public offering price. Stockholders who purchased their shares from us or received their shares through a non-cash transfer and who have held their shares for at least one year may request that we repurchase any number of shares by submitting a repurchase request, the form of which is available on our website, to our repurchase agent. We will effect all repurchases on the last business day of the calendar month or any other business day that may be established by our board of directors.

We may make ordinary repurchases only if we have sufficient funds available to complete the repurchase. In any given calendar month, we are authorized to use only the proceeds from the sale of Class A Shares and Class T Shares under our distribution reinvestment plan during that month to make ordinary repurchases; provided that, if we have excess funds from our distribution reinvestment plan during any particular month, we may, but are not obligated to, carry those excess funds to the subsequent calendar month for the purpose of making ordinary repurchases. Subject to funds being available, in the case of ordinary repurchases, we will limit the number of shares repurchased during any calendar year to 5% of the aggregate number of Class A Shares and Class T Shares outstanding on December 31st of the previous calendar year. In the event that we determine not to repurchase all of the shares presented during any month, including as a result of having insufficient funds or satisfying the 5% limit, to the extent we decide to repurchase shares, shares will be repurchased on a pro rata basis up to the limits described above. Any stockholder whose ordinary repurchase request has been partially accepted in a particular calendar month will have the remainder of his or her request included with all new repurchase requests we have received in the immediately following calendar month, unless he or she chooses to withdraw that request. Further, we have no obligation to repurchase shares if the repurchase would violate the restrictions on distributions under Maryland law, which prohibits distributions that would cause a corporation to fail to meet statutory tests of solvency.

Moreover, our board of directors, in its sole discretion, may amend, suspend (in whole or in part), or terminate our share repurchase program. Further, our board reserves the right in its sole discretion to change the repurchase prices or reject any requests for repurchases. Any amendments to, or suspension or termination of, the share repurchase program may restrict or eliminate a stockholder’s ability to have us repurchase his or her shares and otherwise prevent a stockholder from liquidating his or her investment. Therefore, our stockholders may not have the opportunity to make a repurchase request prior to a potential termination of the share repurchase program and our stockholders may not be able to sell any of their shares of common stock back to us. As a result of these restrictions and circumstances, the ability of our stockholders to sell their shares should they require liquidity is significantly restricted. Moreover, if our stockholders do sell their shares of common stock back to us pursuant to the share repurchase program, they may be forced to do so at a discount to the purchase price such stockholders paid for their shares.

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We will be required to disclose an estimated value per share of each class of our common stock no later than 150 days following the second anniversary of breaking escrow in this offering, and the purchase price a stockholder pays for shares in this offering may be higher than the applicable estimated value per share. The estimated value per share may not be an accurate reflection of the fair market value of our assets and liabilities and likely will not represent the amount of net proceeds that would result if we were liquidated or dissolved.

We are required, due to rules adopted by the Financial Industry Regulatory Authority, or FINRA, and contractual obligations in the selling agreements between our participating broker dealers and the Dealer Manager, to disclose an estimated value per share of our shares no later than 150 days following the second anniversary of breaking escrow in this offering. Our board of directors may determine to modify the offering prices, including the price at which the Class A Shares or Class T Shares are offered pursuant to our distribution reinvestment plan, to reflect the estimated value per share, but the offering price may differ from the estimated value per share. Any estimated value per share that we disclose in the future may not be an accurate reflection of the fair value of our assets and liabilities in accordance with GAAP, may not reflect the price at which we would be able to sell all or substantially all of our assets or the outstanding shares of our common stock in an arm’s length transaction, may not represent the value that stockholders could realize upon a sale of the company or upon the liquidation of our assets and settlement of our liabilities, and may not be indicative of the prices at which shares of our common stock would trade if they were listed on a national securities exchange.

The methodology used to determine the estimated value per share of our common stock may be based upon assumptions, estimates and judgments that may not be accurate or complete, such that, if different property-specific and general real estate and capital market assumptions, estimates and judgments were used, it could result in an estimated value per share that is significantly different. In addition, the policies and procedures that are employed to calculate an estimated value per share in the future may not meet the then-current regulatory requirements.

The interest of later investors in our common stock will be diluted as a result of our payment of stock dividends that have been declared and will be further diluted if we make additional stock dividends.

On October 20, 2015, our board of directors authorized distributions for the month of November comprised of cash and stock. We may also declare and pay additional stock dividends in the future. We have not adjusted, and do not intend to adjust, the gross offering price of the Class A or Class T Shares to reflect any stock dividends. Investors who purchase our shares early in this offering, as compared with later investors, will receive more shares for the same cash investment as a result of any stock dividends. Because they own more shares, upon a sale or liquidation of the Company, these early investors will receive more sales proceeds or liquidating distributions relative to their invested capital compared to later investors.

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

On February 17, 2015, our Registration Statement on Form S-11 (File No. 333-199129), covering a public offering of up to $1,190,000,000 of shares of Class A and Class T common stock was declared effective under the Securities Act. The Offering commenced on February 17, 2015 and is ongoing.

We are offering up to $1,000,000,000 of shares of Class A common stock and shares of Class T common stock, in any combination. We are also offering up to $190,000,000 of Class A and Class T Shares in the DRP. We reserve the right to reallocate the shares between share classes in our reasonable best efforts offering and between our reasonable best efforts offering and the DRP.

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From the effective date of the Offering through September 30, 2015, we had sold the following securities in the Offering for the following aggregate offering prices:

•   103,058 Class A Shares, equal to $2,357,800 in aggregate gross offering proceeds, in the reasonable best efforts Offering.

From the effective date of the Offering through September 30, 2015, we have paid the following costs in connection with the issuance and distribution of the registered securities:

Type of Costs	Amount
Offering costs paid to related parties (1)	$	64,911
Offering costs paid to non-related parties		1,014,449
Total offering costs paid	$	1,079,360

(1) “Offering costs to related parties” include selling commissions, marketing contributions and due diligence expense reimbursements paid to Inland Securities Corporation, which reallowed all or a portion of these amounts to soliciting dealers.

From the effective date of the Offering through September 30, 2015, the net offering proceeds to us from the Offering, after deducting the total expenses incurred described above, were approximately $1.3 million. As of September 30, 2015, we had used approximately $0.7 million of these net proceeds to purchase interests in real estate and pay related costs, of which $32,898 was paid to related parties, and $22,556 to pay loan origination costs. The remaining net proceeds were held as cash at September 30, 2015.

During the period covered by this quarterly report, we did not sell any equity securities that were not registered under the Securities Act, and we did not repurchase any of our securities.

Item 3.  Defaults Upon Senior Securities

None.

Item 4.  Mine Safety Disclosures

Not Applicable.

Item 5.  Other Information

Not Applicable.

Item 6.  Exhibits

The representations, warranties and covenants made by us in any agreement filed as an exhibit to this Form 10-Q are made solely for the benefit of the parties to the agreement, including, in some cases, for the purpose of allocating risk among the parties to the agreement, and should not be deemed to be representations, warranties or covenants to, or with, you. Moreover, these representations, warranties and covenants should not be relied upon as accurately describing or reflecting the current state of our affairs.

The exhibits filed in response to Item 601 of Regulation S-K are listed on the Exhibit Index attached hereto and are incorporated herein by reference.

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SIGNATURES

Pursuant to the requirements 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.

INLAND RESIDENTIAL PROPERTIES TRUST, INC.
	/s/ Mitchell A. Sabshon
By:	Mitchell A. Sabshon
	President and chief executive officer
Date:	November 12, 2015
	/s/ Catherine L. Lynch
By:	Catherine L. Lynch
	Chief Financial Officer (co-principal financial officer)
Date:	November 12, 2015
	/s/ David Z. Lichterman
By:	David Z. Lichterman
	Vice President, Treasurer and Chief Accounting Officer (co-principal financial officer and principal accounting officer)
Date:	November 12, 2015

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Exhibit Index

Exhibit No.	Description
1.1	Second Amended and Restated Dealer Manager Agreement, dated September 8, 2015 (incorporated by reference to Exhibit 1.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on September 9, 2015 (file number 333-199129))
1.2	Second Amended Form of Soliciting Dealer Agreement (included as Exhibit A in Exhibit 1.1)
4.1	Third Amended and Restated Distribution Reinvestment Plan, dated September 8, 2015 (incorporated by reference to Exhibit 4.1 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on September 9, 2015 (file number 333-199129))
4.2	Amended and Restated Share Repurchase Program, effective October 19, 2015 (incorporated by reference to Exhibit 4.2 to the Registrant’s Current Report on Form 8-K, as filed with the Securities and Exchange Commission on September 14, 2015 (file number 333-199129))
10.1	Purchase and Sale Agreement, dated July 20, 2015, by and between Inland Real Estate Acquisitions, Inc. and The Haven at Market Square, LLC (incorporated by reference to Exhibit 10.1 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.2	Assignment and Assumption of Purchase and Sale Agreement, dated September 30, 2015, by and between Inland Real Estate Acquisitions, Inc. and IRESI Frederick Market Square, L.L.C. (incorporated by reference to Exhibit 10.2 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.3	Assignment and Assumption of Leases, dated September 30, 2015, by and between IRESI Frederick Market Square, L.L.C. and The Haven at Market Square, LLC (incorporated by reference to Exhibit 10.3 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.4	Loan Agreement, dated September 30, 2015, by and between IRESI Frederick Market Square, L.L.C. and Parkway Bank and Trust Company (incorporated by reference to Exhibit 10.4 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.5	Secured Promissory Note, dated September 30, 2015, by IRESI Frederick Market Square, L.L.C. for the benefit of Parkway Bank and Trust Company (incorporated by reference to Exhibit 10.5 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.6	Purchase Money Deed of Trust, Security Agreement, Assignment of Leases and Rents and Fixture Filing, dated September 30, 2015, by IRESI Frederick Market Square, L.L.C., Lawyers Title Realty Services, Inc., as trustee, for the benefit of Parkway Bank and Trust Company (incorporated by reference to Exhibit 10.6 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.7	Assignment of Leases and Rents, dated September 30, 2015, by IRESI Frederick Market Square, L.L.C. to Parkway Bank and Trust Company (incorporated by reference to Exhibit 10.7 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.8	Security Agreement, dated September 30, 2015, by and between IRESI Frederick Market Square, L.L.C. and Parkway Bank and Trust Company (incorporated by reference to Exhibit 10.8 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.9	Guaranty, dated September 30, 2015, by Inland Real Estate Investment Corporation in favor of Parkway Bank and Trust Company with respect to certain indebtedness and liabilities of IRESI Frederick Market Square, L.L.C. (incorporated by reference to Exhibit 10.9 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
10.10	Environmental Indemnity Agreement, dated September 30, 2015, by IRESI Frederick Market Square, L.L.C. and Inland Real Estate Investment Corporation in favor of Parkway Bank and Trust Company (incorporated by reference to Exhibit 10.10 to the Registrant’s Current Report on Form 8-K, as filed by the Registrant with the Securities and Exchange Commission on October 6, 2015 (file number 333-199129))
31.1	Certification by Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
31.2	Certification by Co-Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
31.3	Certification by Co-Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002*
32.1	Certification by Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
32.2	Certification by Co-Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
32.3	Certification by Co-Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002*
101	The following financial information from our Quarterly Report on Form 10-Q for the period ended September 30, 2015, filed with the Securities and Exchange Commission on November 12, 2015, is formatted in Extensible Business Reporting Language (“XBRL”): (i) Consolidated Balance Sheets; (ii) Consolidated Statements of Operations; (iii) Consolidated Statement of Equity (Deficit); (iv) Consolidated Statements of Cash Flows; and (v) Notes to Consolidated Financial Statements (tagged as blocks of text)

* Filed as part of this Quarterly Report on Form 10-Q.

EX-31.1

Exhibit 31.1

CERTIFICATION

I, Mitchell A. Sabshon certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Inland Residential Properties Trust, 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(s) 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(s) 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.

	/s/ Mitchell A. Sabshon
Name:	Mitchell A. Sabshon
Title:	President and Chief Executive Officer
Date:	November 12, 2015

EX-31.2

Exhibit 31.2

CERTIFICATION

I, Catherine L. Lynch, certify that:

1. I have reviewed this Quarterly Report on Form 10-Q of Inland Residential Properties Trust, 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(s) 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(s) 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.

	/s/ Catherine L. Lynch
Name:	Catherine L. Lynch
Title:	Co-Principal Financial Officer
Date:	November 12, 2015

EX-31.3

Exhibit 31.3

CERTIFICATION

I, David Z. Lichterman, certify that:

1.	I have reviewed this quarterly report on Form 10-Q of Inland Residential Properties Trust, 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(s) 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(s) 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.

	/s/ David Z. Lichterman
Name:	David Z. Lichterman
Title:	Vice President, Treasurer, Co-Principal Financial Officer and Principal Accounting Officer
Date:	November 12, 2015

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

In connection with the Quarterly Report on Form 10-Q of Inland Residential Properties Trust, Inc. (the “Company”) for the fiscal quarter ended September 30, 2015, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Mitchell A. Sabshon, President and Principal Executive Officer of the Company, certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

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:  November 12, 2015	By:	/s/ Mitchell A. Sabshon
	Name:	Mitchell A. Sabshon
	Title:	President and Principal Executive Officer

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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

In connection with the Quarterly Report on Form 10-Q of Inland Residential Properties Trust, Inc. (the “Company”) for the fiscal quarter ended September 30, 2015, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Catherine L. Lynch, Co-Principal Financial Officer of the Company, certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of her knowledge:

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:  November 12, 2015	By:	/s/ Catherine L. Lynch
	Name:	Catherine L. Lynch
	Title:	Co-Principal Financial Officer

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.3

Exhibit 32.3

Certification Pursuant to

18 U.S.C. Section 1350, as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Inland Residential Properties Trust, Inc. (the “Company”) for the fiscal quarter ended September 30, 2015, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), David Z. Lichterman, Vice President, Treasurer, Co-Principal Financial Officer and Principal Accounting Officer of the Company, certifies, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

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:  November 12, 2015	By:	/s/ David Z. Lichterman
	Name:	David Z. Lichterman
	Title:	Vice President, Treasurer, Co-Principal Financial Officer and Principal Accounting Officer

This certification accompanies the Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended. A signed original of this written statement required by Section 906 has been provided to the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

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ACQUISITIONS (Schedule of Pro Forma Financial Information for Acquisitions) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Business Combinations [Abstract]
Pro forma total income	$ 942,215	$ 382,621	$ 2,630,318	$ 593,608
Pro forma net loss	$ (575,275)	$ (921,691)	$ (1,649,628)	$ (3,215,658)
Loss per share	$ (5.18)	$ (8.30)	$ (14.85)	$ (28.95)

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INCOME TAX

9 Months Ended

Sep. 30, 2015

Income Tax Disclosure [Abstract]

INCOME TAX

NOTE 3 – INCOME TAX

The Company had no uncertain tax positions as of September 30, 2015. The Company expects no significant increases in uncertain tax positions due to changes in tax positions within one year of September 30, 2015. The Company has no interest or penalties relating to income taxes recognized in the consolidated statements of operations for the three and nine months ended September 30, 2015 and 2014. As of September 30, 2015, the tax returns for the calendar years 2014 and 2013 remain subject to examination by U.S. and various state and local tax jurisdictions.

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TRANSACTIONS WITH RELATED PARTIES (Schedule of Transactions with Related Parties) (Details) - USD ($)		3 Months Ended		9 Months Ended
		Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014	Dec. 31, 2014
Related Party Transaction [Line Items]
Due to related parties		$ 4,889,407		$ 4,889,407		$ 1,532,667
General and Administrative Expense [Member]
Related Party Transaction [Line Items]
General and administrative expenses	[1]	61,168		147,548
Due to related parties	[1]	$ 81,253		$ 81,253		$ 95,289
Organization Costs [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[2]		$ 225		$ 1,610
Due to related parties	[2]
Acquisition Related Costs [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[3]	$ 719,148		$ 719,148
Due to related parties	[3]	686,250		686,250
Offering Costs [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[4]	25,278	$ 57,413	145,958	$ 71,603
Due to related parties	[4]	1,034,665		1,034,665		$ 1,137,378
Business Management Fee [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[5]	22,864		22,864
Due to related parties	[5]	22,864		22,864
Mortgage Financing Fee [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[6]	114,375		114,375
Due to related parties	[6]	114,375		114,375
Sponsor Non-interest Bearing Advances [Member]
Related Party Transaction [Line Items]
Expenses with related parties	[7]	450,000		2,650,000
Due to related parties	[7]	$ 2,950,000		$ 2,950,000		$ 300,000

[1] The Business Manager and its affiliates are entitled to reimbursement for certain general and administrative expenses relating to the Company's administration. Such costs are included in general and administrative expenses in the accompanying consolidated statements of operations. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. The Company established a discount stock purchase policy for related parties that enables them to purchase shares of common stock at $22.81 per share. The Company sold 3,683 shares to related parties during the nine months ended September 30, 2015.

[2] The Business Manager or its affiliates will pay or reimburse any organization or offering costs, including any issuer costs, that exceed 10.75% of the gross offering proceeds from Class A Shares, and 6.75% of the gross offering proceeds from Class T Shares sold in the 'reasonable best efforts' offering over the life of the Offering.

[3] The Company pays the Business Manager or its affiliates a fee equal to 1.5% of the "contract purchase price" as defined, of each property and real estate-related asset acquired. The Business Manager and its affiliates are also reimbursed for acquisition and transaction related costs of the Business Manager and its affiliates relating to the Company's acquisition of real estate assets, regardless of whether the Company acquires the real estate assets, subject to limits, as defined. Such costs are included in acquisition related costs in the accompanying consolidated statements of operations. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets.

[4] The Company reimburses the Sponsor and its affiliates for costs and other expenses of the Offering that they pay on the Company's behalf. Offering costs are offset against the stockholders' equity accounts. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. An affiliate of the Business Manager also receives selling commissions equal to 6.0% of the sale price for each Class A Share sold and 2.0% of the sale price for each Class T Share sold and a dealer manager fee equal to 2.75% of the sale price for each share sold, the majority of which is re-allowed (paid) to third party soliciting dealers. The Company does not pay selling commissions or the dealer manager fee in connection with shares issued through the DRP.

[5] The Company pays the Business Manager an annual business management fee equal to 0.6% of its "average invested assets", payable quarterly in an amount equal to 0.15% of the Company's average invested assets as of the last day of the immediately preceding quarter. "Average invested assets" means, for any period, the average of the aggregate book value of the Company's assets, including all intangibles and goodwill, invested, directly or indirectly, in equity interests in, and loans secured by, properties, as well as amounts invested in securities or consolidated and unconsolidated joint ventures or other partnerships, before reserves for amortization and depreciation or bad debts, impairments or other similar non-cash reserves, computed by taking the average of these values at the end of each month during the relevant calendar quarter.

[6] The Company pays the Business Manager, or its affiliates, a mortgage financing fee equal to 0.25% of the amount available or borrowed under the financing or the assumed debt if the Business Manager or its affiliates provides services in connection with the origination or refinancing of any debt that the Company obtains and uses to finance properties or other assets, or that is assumed, directly or indirectly, in connection with the acquisition of properties or other assets.

[7] This amount on the accompanying consolidated balance sheets contains non-interest bearing advances made by the Sponsor which the Company intends to repay.

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TRANSACTIONS WITH RELATED PARTIES (Narrative) (Details) - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Related Party Transaction [Line Items]
Capital contributed by Sponsor for common stock shares	$ 200,000
Number of common shares Sponsor received, subsequently converted in Class A Common Stock	8,000
Number of Class A shares issued as result of Sponsor converting common shares	8,000
Total cash advances provided by Sponsor since Company inception	$ 2,950,000
Total offering and organizational costs incurred since inception	3,817,104
Advances from sponsor	$ 2,650,000
Common stock shares sold to related party during period	3,683
Price per share of common stock sold to related parties during period	$ 22.81
Minimum percentage of gross offering proceeds from Class A Shares, requiring issuer cost reimbursement from the Business Manager or its affiliates	10.75%
Minimum percentage of gross offering proceeds from Class T Shares, requiring issuer cost reimbursement from the Business Manager or its affiliates	6.75%
Fee paid to Business Manager or its affiliates expressed as a percentage of the ‘contract purchase price’ as defined, of each property and real estate-related asset acquired	1.50%
Selling commission paid to affiliate of the Business Manager expressed as a percentage of the sales price for each Class A Share sold	6.00%
Selling commission paid to affiliate of the Business Manager expressed as a percentage of the sales price for each Class T Share sold	2.00%
Dealer manager fee paid to affiliate of the Business Manager expressed as a percentage of the sales price for each Class A and Class T share sold	2.75%
Annual business management fee paid to the Business Manager expressed as a percentage of the Company’s “average invested assets”	0.06%
Mortgage financing fee paid to the Business Manager or its affiliates expressed as a percentage of the amount available or borrowed under financing or assumed debt	0.25%
Class A Common Stock [Member]
Related Party Transaction [Line Items]
Shares sold during period	87,680.842
Advances from sponsor	$ 2,000,000
Equity issuance, price per share	$ 22.81

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SUBSEQUENT EVENTS (Details) - Subsequent Event [Member] - $ / shares	1 Months Ended
	Oct. 31, 2015	Oct. 20, 2015
Maximum [Member]
Subsequent Event [Line Items]
Dividends payable, payment date	Dec. 07, 2015
Cash Dividend [Member] | Class A Common Stock [Member]
Subsequent Event [Line Items]
Dividends payable, declaration date	Oct. 20, 2015
Amount per share of distributions		$ 0.003424658
Cash Dividend [Member] | Class A Common Stock [Member] | Minimum [Member]
Subsequent Event [Line Items]
Dividends payable, record date	Nov. 01, 2015
Cash Dividend [Member] | Class A Common Stock [Member] | Maximum [Member]
Subsequent Event [Line Items]
Dividends payable, record date	Nov. 30, 2015
Cash Dividend [Member] | Class T Common Stock [Member]
Subsequent Event [Line Items]
Dividends payable, declaration date	Oct. 20, 2015
Amount per share of distributions		0.002768493
Cash Dividend [Member] | Class T Common Stock [Member] | Minimum [Member]
Subsequent Event [Line Items]
Dividends payable, record date	Nov. 01, 2015
Cash Dividend [Member] | Class T Common Stock [Member] | Maximum [Member]
Subsequent Event [Line Items]
Dividends payable, record date	Nov. 30, 2015
Stock Dividend [Member] | Class A Common Stock [Member]
Subsequent Event [Line Items]
Dividends payable, record date	Nov. 30, 2015
Dividends payable, declaration date	Oct. 20, 2015
Amount per share of distributions		0.000833333
Stock Dividend [Member] | Class T Common Stock [Member]
Subsequent Event [Line Items]
Dividends payable, record date	Nov. 30, 2015
Dividends payable, declaration date	Oct. 20, 2015
Amount per share of distributions		$ 0.000833333

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

9 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

General

The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

Consolidation

The accompanying consolidated financial statements include the accounts of the Company, as well as Inland Residential Operating Partnership, L.P., of which the Company is the sole general partner, and the accounts of the Company’s wholly owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation.

Partially-Owned Entities

The Company will consolidate the operations of a joint venture if the Company determines that it is either the primary beneficiary of a variable interest entity or “VIE” or has substantial influence and control of the entity. The primary beneficiary is the party that has the ability to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses and right to receive the returns from the VIE that would be significant to the VIE. There are significant judgments and estimates involved in determining the primary beneficiary of a VIE or the determination of who has control and influence of the entity. When the Company consolidates an entity, the assets, liabilities and results of operations will be included in the Company’s consolidated financial statements.

In instances where the Company determines that it is not the primary beneficiary of a VIE or the Company does not control the joint venture but can exercise influence over the entity with respect to its operations and major decisions, the Company will use the equity method of accounting. Under the equity method, the operations of a joint venture will not be consolidated with the Company’s operations but instead its share of operations will be reflected as equity in earnings (loss) on unconsolidated entity on the Company’s consolidated statements of operations. Additionally, the Company’s net investment in the joint venture will be reflected as investment in unconsolidated entity on the consolidated balance sheets.

Offering and Organization Costs

Costs associated with the Offering are deferred and charged against the gross proceeds of the Offering upon the sale of shares. Formation and organizational costs were expensed as incurred. Deferred Offering costs were $2,614,621 at December 31, 2014 and are included in deferred costs, net in the accompanying consolidated financial statements.

Cash and Cash Equivalents

The Company considers all demand deposits, money market accounts and all short term investments with a maturity of three months or less, at the date of purchase, to be cash equivalents. The Company maintains its cash and cash equivalents at financial institutions. The account balance may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes that the risk will not be significant, as the Company does not anticipate the financial institutions’ non-performance.

Acquisitions

Upon acquisition, the Company determines the total purchase price of each property (see Note 4 – “Acquisitions”), which includes the estimated contingent consideration to be paid or received in future periods, if any. The Company allocates the total purchase price of properties based on the fair value of the tangible and intangible assets acquired and liabilities assumed based on Level 3 inputs, such as comparable sales values, discount rates, capitalization rates, revenue and expense growth rates and lease-up assumptions, from a third party appraisal or other market sources. Such tangible assets include land, building improvements, furniture, fixtures and equipment and such intangible assets include acquired above market and below market leases, in place lease value and any assumed financing that is determined to be above or below market terms.

The Company expenses acquisition costs of all transactions as incurred. All costs related to finding, analyzing and negotiating a transaction are expensed as incurred as acquisition related costs, whether or not the acquisition is completed. These expenses include acquisition fees paid to the Business Manager.

Impairment

The Company assesses the carrying values of the respective long-lived assets, whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable. If it is determined that the carrying value is not recoverable because the undiscounted cash flows do not exceed the carrying value, the Company will be required to record an impairment loss to the extent that the carrying value exceeds fair value. The valuation and possible subsequent impairment of real estate properties will be a significant estimate that can change based on the Company’s continuous process of analyzing each property and reviewing assumptions about inherently uncertain factors, as well as the economic condition of the property at a particular point in time.

Cost Capitalization and Depreciation Policies

Real estate acquisitions are recorded at cost less accumulated depreciation. Improvements and betterment costs will be capitalized and ordinary repairs and maintenance will be expensed as incurred.

Depreciation expense is computed using the straight-line method. Buildings and improvements are depreciated on a straight-line basis based upon estimated useful lives of thirty years for buildings and improvements, and five to fifteen years for furniture, fixtures and equipment and site improvements. Loan fees are amortized on a straight-line basis, which approximates the effective interest method, over the life of the related loan as a component of interest expense. The portion of the purchase price allocated to acquired above market lease costs and acquired below market lease costs is amortized on a straight-line basis over the life of the related lease (including renewal periods for below market leases with fixed rate renewals) as an adjustment to net rental income. Acquired in-place lease costs and other leasing costs are amortized on a straight-line basis over the weighted-average remaining lease term as a component of amortization expense.

Cost capitalization and the estimate of useful lives require judgment and include significant estimates that can and do change.

Fair Value Measurements

The Company estimates fair value using available market information and valuation methodologies it believes to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they will not necessarily be indicative of amounts that would be realized upon disposition.

The Company defines fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company has established a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy will consist of three broad levels, which are described below:

▪	Level 1 −	Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
▪	Level 2 −	Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
▪	Level 3 −	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

Revenue Recognition

Rental income attributable to leases is recorded on a straight-line basis, which is not materially different than if it were recorded when due from residents, and recognized monthly as it was earned. Leases entered into between a resident and a property for the rental of an apartment unit will generally be year-to-year, renewable upon consent of both parties. Retail/commercial leases will generally have five to ten year lease terms with market based renewal options. 

Valuation of Accounts and Rents Receivable

The Company takes into consideration certain factors that require judgments to be made as to the collectability of receivables. Collectability factors taken into consideration are the amounts outstanding, payment history and financial strength of the tenant, which taken as a whole determines the valuation.

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. A valuation allowance is established for uncertainties relating to realization of deferred tax assets. At September 30, 2015 and December 31, 2014, the Company had a deferred tax asset of approximately $726,017 and $74,000, respectively, for which a valuation allowance was recorded in the same amount due to the uncertainty of realization.

Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, Business Combinations - Simplifying the Accounting for Measurement-Period Adjustments. The amendments in the ASU eliminate the requirement of an acquirer to retrospectively account for provisional amounts that are identified during the measurement period after a business combination. This ASU requires an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The ASU also requires the acquirer to disclose the amount recorded in current-period earnings, by line item, that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The ASU is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been issued and will be applied prospectively to adjustments to provisional amounts that occur after the effective date. The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The ASU requires that debt issuance costs be deducted from the carrying value of the financial liability and not recorded as separate assets, classified as deferred financing costs. The ASU is effective for public entities for financial statements issued for fiscal years beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued and will be applied on a retrospective basis. The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective, although it will not affect the accounting for rental related revenues. The new standard is effective for the Company on January 1, 2018. Early adoption is permitted but not prior to the original effective date of January 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU No. 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

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CONSOLIDATED BALANCE SHEETS - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Real estate:
Land	$ 6,301,838
Building and other improvements	38,824,096
Total real estate	45,125,934
Cash and cash equivalents	1,689,711	$ 232,635
Acquired in place lease intangibles	601,623
Deferred costs, net	136,930	$ 2,614,621
Other assets	351,113	19,867
Total assets	47,905,311	$ 2,867,123
Liabilities:
Mortgages payable	45,750,000
Accounts payable and accrued expenses	249,363	$ 1,319,477
Due to related parties	4,889,407	$ 1,532,667
Other liabilities	19,727
Total liabilities	$ 50,908,497	$ 2,852,144
Commitments and contingencies
Stockholder's (deficit) equity:
Preferred stock, $.001 par value, 50,000,000 shares authorized, none outstanding
Common stock		$ 8
Additional paid in capital (net of offering costs of $3,754,008 and $0 as of September 30, 2015 and December 31, 2014, respectively)	$ (1,188,254)	199,992
Retained deficit	(1,815,043)	(185,021)
Total stockholder's (deficit) equity	(3,003,186)	14,979
Total liabilities and stockholder's (deficit) equity	47,905,311	$ 2,867,123
Class A Common Stock [Member]
Stockholder's (deficit) equity:
Common stock	$ 111
Class T Common Stock [Member]
Stockholder's (deficit) equity:
Common stock

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CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
OPERATING ACTIVITIES:
Net loss	$ (1,630,022)	$ (10,462)
Adjustments to reconcile net loss to net cash used in operating activities:
Discount on shares issued to related parties	8,065
Changes in assets and liabilities:
Accounts payable	(20,924)	$ 34,394
Due to related parties	704,154	$ (24,025)
Other liabilities	18,072
Other assets	(79,313)
Net cash flows used in operating activities	(999,968)	$ (93)
INVESTING ACTIVITIES:
Purchase of real estate	(45,986,910)
Net cash flows used in investing activities	(45,986,910)
FINANCING ACTIVITIES:
Proceeds from offering	2,357,800
Proceeds from mortgages payable	45,750,000
Payment of offering costs	(2,291,290)
Advances from sponsor	2,650,000
Payment of loan costs	(22,556)
Net cash flows provided by financing activities	48,443,954
Net increase (decrease) in cash and cash equivalents	1,457,076	$ (93)
Cash and cash equivalents at beginning of the period	232,635	500,000
Cash and cash equivalents, at end of period	1,689,711	$ 499,907
SUPPLEMENTAL DISCLOSURES: In conjunction with the purchase of real estate, the Company acquired assets and assumed liabilities as follows:
Land	6,301,838
Building and other improvements	37,591,342
Furniture, fixtures and equipment	1,232,754
Acquired in place lease intangibles	601,623
Acquired assets, net	259,353
Purchase of real estate	45,986,910
NON-CASH INVESTING AND FINANCING TRANSACTIONS:
Accrued offering costs payable	$ (1,151,904)	$ (295,958)

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ACQUISITIONS (Narrative) (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Business Combinations [Abstract]
Proceeds from mortgages payable			$ 45,750,000
Acquisition related costs incurred during the period	$ 1,207,188		1,207,188
Revenue	$ 10,441		10,441
Net income from properties acquired during the period, net of expensed acquisition related costs			$ 8,931

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ACQUISITIONS (Schedule of Major Assets Acquired and Liabilities Assumed) (Details) - The Retreat at Market Square [Member]	Sep. 30, 2015 USD ($)
Business Acquisition [Line Items]
Property acquisition, land	$ 6,301,838
Property acquisition, buildings and improvements	37,591,342
Property acquisition, furniture, fixtures and equipment	1,232,754
Property acquisition, acquired lease intangibles	$ 601,623

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ORGANIZATION

9 Months Ended

Sep. 30, 2015

Organization, Consolidation and Presentation of Financial Statements [Abstract]

ORGANIZATION

NOTE 1 - ORGANIZATION

Inland Residential Properties Trust, Inc. was formed on December 19, 2013 to acquire and manage a portfolio of multifamily properties located primarily in the top 100 United States metropolitan statistical areas, which generally contain populations greater than 500,000 people. Effective July 14, 2014, the Company changed its name from “Inland Retail Properties Trust V, Inc.” to “Inland Residential Properties Trust, Inc.” The Company entered into a Business Management Agreement (the “Business Management Agreement”) with Inland Residential Business Manager & Advisor, Inc. (the “Business Manager”), a related party of the Company, to be the Business Manager to the Company.

The Company is authorized to sell up to $1,000,000,000 of shares of common stock which consist of Class A common stock, $.001 par value per share (“Class A Shares”), at a price of $25.00 per share and Class T common stock, $.001 par value per share (“Class T Shares”), at $23.95 per share, in any combination, in an initial “reasonable best efforts” offering (the “Offering”) which commenced on February 17, 2015. The Company is also authorized to issue up to $190,000,000 of Class A and Class T Shares at a per share price of $23.75 and $22.81, respectively, pursuant to the Company’s distribution reinvestment plan (as amended, “DRP”). In addition, the Company declared that each share of common stock that was issued and outstanding immediately prior to the effective date of the amendment of the Company’s charter converted into one Class A Share. As a result, the 8,000 shares of common stock Inland Real Estate Investment Corporation, (the “Sponsor”), owned as of December 31, 2014 were converted into 8,000 Class A Shares. On September 9, 2015, the Company sold 87,680.842 Class A Shares to the Sponsor for an aggregate purchase price of $2,000,000, or $22.81 per share. Giving effect to this sale, as of such date, having raised approximately $2,348,800 in Class A Shares, the Company met its minimum offering requirement and broke escrow in all states, except Ohio, Pennsylvania, Tennessee and Washington.

The Company provides the following programs to facilitate investment in the Company’s shares and to provide limited liquidity for stockholders.

The Company provides stockholders with the option to purchase additional shares from the Company by automatically reinvesting cash distributions through the DRP, subject to certain share ownership restrictions. For participants in the DRP, cash distributions paid on Class A Shares and Class T Shares, as applicable, will be used to purchase Class A Shares and Class T Shares, respectively. Such purchases under the DRP will not be subject to selling commissions, dealer manager fees, distribution and stockholder servicing fees or reimbursement of issuer costs in connection with shares of common stock issued through the DRP and are made initially at a price of $23.75 and $22.81 per Class A Share and Class T Share, respectively. The price is subject to change after the earlier of (1) the change of the public offering price in a public “reasonable best efforts” offering of the Company’s Class A Shares from $25.00 per Class A Share or Class T Shares from $23.95 per Class T Share, as applicable, if there is a change, and (2) termination of all “reasonable best efforts” public offerings of the Company’s Class A Shares or Class T Shares, as applicable. 

The Company may purchase shares under the share repurchase program (as amended, “SRP”), if the Company chooses to repurchase them. Subject to funds being available, the Company will limit the number of shares repurchased during any calendar year to 5% of the number of shares of common stock outstanding on December 31st of the previous calendar year. Funding for the SRP will come from proceeds that the Company receives from the DRP. In the case of repurchases made upon the death of a stockholder or qualifying disability, as defined in the SRP, neither the one year holding period, the limit regarding funds available from the DRP nor the 5% limit will apply. The SRP will immediately terminate if the Company’s shares become listed for trading on a national securities exchange. In addition, the Company’s board of directors, in its sole direction, may, at any time, amend, suspend or terminate the SRP.

The Company intends to elect to be taxed as a real estate investment trust (“REIT”) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), beginning with its taxable year ending December 31, 2015 or the Company’s first year of material operations. In order to maintain the Company’s qualification as a REIT, the Company is required to, among other things, make aggregate annual distributions (other than capital gain dividends) to the Company’s stockholders of at least 90% of the Company’s annual REIT taxable income (which does not equal net income as calculated in accordance with U.S. GAAP) determined without regard to the deduction for dividends paid and excluding net capital gain, and meet certain tests regarding the nature of the Company’s income and assets.

If the Company qualifies for taxation as a REIT, the Company generally will not be subject to U.S. federal income tax to the extent it meets certain criteria and distributes its REIT taxable income to its stockholders. Even if the Company qualifies for taxation as a REIT, the Company may be subject to (1) certain state and local taxes on its income, property or net worth, and (2) U.S. federal income and excise taxes on its undistributed income, if any income remains undistributed. The Company intends to operate in a manner that allows the Company to meet the requirements for taxation as a REIT, including creating taxable REIT subsidiaries to hold assets that generate income that would not be consistent with the rules applicable to qualification as a REIT if held directly by the REIT. If the Company were to fail to meet these requirements, it could be subject to U.S. federal income tax on the Company’s taxable income at regular corporate rates. The Company would not be able to deduct distributions paid to stockholders in any year in which it fails to qualify as a REIT. The Company will also be disqualified for the four taxable years following the year during which qualification was lost unless the Company is entitled to relief under specific statutory provisions.

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CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Preferred stock, par value	$ .001	$ .001
Preferred stock, shares authorized	50,000,000	50,000,000
Preferred stock, shares issued	0	0
Preferred stock, shares outstanding	0	0
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	400,000,000	400,000,000
Common stock, shares issued	0	8,000
Common stock, shares outstanding	0	8,000
Offering costs included as reduction to additional paid in capital	$ 3,754,008
Class A Common Stock [Member]
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	320,000,000	320,000,000
Common stock, shares issued	111,058	0
Common stock, shares outstanding	111,058	0
Class T Common Stock [Member]
Common stock, par value	$ .001	$ .001
Common stock, shares authorized	80,000,000	80,000,000
Common stock, shares issued	0	0
Common stock, shares outstanding	0	0

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MORTGAGES PAYABLE (Tables)

9 Months Ended

Sep. 30, 2015

Debt Disclosure [Abstract]

Schedule of Mortgages Payable

As of September 30, 2015, the Company’s mortgage loan is secured by a first mortgage on the property.

Property Name	Stated Interest Rate Per Annum	Principal Balance at September 30, 2015		Principal Balance at December 31, 2014		Maturity Date	Notes
The Retreat at Market Square	3.95%	$	45,750,000	$	—	September 30, 2016	(a)

(a) The loan requires monthly payments of interest only until the maturity date. Subject to certain conditions, the Company has a one-time option to extend the maturity date for an additional seven year period to September 30, 2023. If extended, the mortgage loan would bear interest at a fixed rate equal to 3.79%. During the initial one-year term of the loan, the Sponsor has agreed to guarantee the payment of (i) all real estate taxes on the property which accrue or become due during the term of the loan, (ii) all Costs and Expenses, as defined, and (iii) any and all losses, damages, costs or expenses of the lender, which arise in consequence of certain events, as defined, provided that the guaranteed obligation will be limited to the payment of $9,150,000, plus enforcement costs. The Company has not paid, and will not pay, any fees or other consideration to the Sponsor for this guarantee.

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Document and Entity Information - shares	9 Months Ended
	Sep. 30, 2015	Nov. 10, 2015
Document And Entity Information
Entity Registrant Name	Inland Residential Properties Trust, Inc.
Entity Central Index Key	0001595627
Document Type	10-Q
Document Period End Date	Sep. 30, 2015
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		119,095
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2015

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TRANSACTIONS WITH RELATED PARTIES (Tables)

9 Months Ended

Sep. 30, 2015

Related Party Transactions [Abstract]

Schedule of Transactions with Related Parties

The following table summarizes the Company’s related party transactions for the three and nine months ended September 30, 2015 and 2014 and as of September 30, 2015 and December 31, 2014.

		Three months ended September 30,				Nine months ended September 30,				Amount Unpaid as of
		2015		2014		2015		2014		September 30, 2015		December 31, 2014
General and administrative expenses	(a)	$	61,168	$	—	$	147,548	$	—	$	81,253	$	95,289
Organization costs	(b)		—		225		—		1,610		—		—
Acquisition related costs	(c)		719,148		—		719,148		—		686,250		—
Offering costs	(d)		25,278		57,413		145,958		71,603		1,034,665		1,137,378
Business management fee	(e)		22,864		—		22,864		—		22,864		—
Mortgage financing fee	(f)		114,375		—		114,375		—		114,375		—
Sponsor non-interest bearing advances	(g)		450,000		—		2,650,000		—		2,950,000		300,000

(a)	The Business Manager and its affiliates are entitled to reimbursement for certain general and administrative expenses relating to the Company’s administration. Such costs are included in general and administrative expenses in the accompanying consolidated statements of operations. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. The Company established a discount stock purchase policy for related parties that enables them to purchase shares of common stock at $22.81 per share. The Company sold 3,683 shares to related parties during the nine months ended September 30, 2015.
(b)	The Business Manager or its affiliates will pay or reimburse any organization or offering costs, including any issuer costs, that exceed 10.75% of the gross offering proceeds from Class A Shares, and 6.75% of the gross offering proceeds from Class T Shares sold in the “reasonable best efforts” offering over the life of the Offering.
(c)	The Company pays the Business Manager or its affiliates a fee equal to 1.5% of the “contract purchase price,” as defined, of each property and real estate-related asset acquired.  The Business Manager and its affiliates are also reimbursed for acquisition and transaction related costs of the Business Manager and its affiliates relating to the Company’s acquisition of real estate assets, regardless of whether the Company acquires the real estate assets, subject to limits, as defined.  Such costs are included in acquisition related costs in the accompanying consolidated statements of operations.  Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets.
(d)	The Company reimburses the Sponsor and its affiliates for costs and other expenses of the Offering that they pay on the Company’s behalf.  Offering costs are offset against the stockholders’ equity accounts. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. An affiliate of the Business Manager also receives selling commissions equal to 6.0% of the sale price for each Class A Share sold and 2.0% of the sale price for each Class T Share sold and a dealer manager fee equal to 2.75% of the sale price for each share sold, the majority of which is re-allowed (paid) to third party soliciting dealers. The Company does not pay selling commissions or the dealer manager fee in connection with shares issued through the DRP.
(e)	The Company pays the Business Manager an annual business management fee equal to 0.6% of its “average invested assets,” payable quarterly in an amount equal to 0.15% of the Company’s average invested assets as of the last day of the immediately preceding quarter. “Average invested assets” means, for any period, the average of the aggregate book value of the Company’s assets, including all intangibles and goodwill, invested, directly or indirectly, in equity interests in, and loans secured by, properties, as well as amounts invested in securities or consolidated and unconsolidated joint ventures or other partnerships, before reserves for amortization and depreciation or bad debts, impairments or other similar non-cash reserves, computed by taking the average of these values at the end of each month during the relevant calendar quarter.
(f)	The Company pays the Business Manager, or its affiliates, a mortgage financing fee equal to 0.25% of the amount available or borrowed under the financing or the assumed debt if the Business Manager or its affiliates provides services in connection with the origination or refinancing of any debt that the Company obtains and uses to finance properties or other assets, or that is assumed, directly or indirectly, in connection with the acquisition of properties or other assets.
(g)	This amount on the accompanying consolidated balance sheets contains non-interest bearing advances made by the Sponsor which the Company intends to repay.

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CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Income:
Rental income	$ 10,441		$ 10,441
Total income	10,441		10,441
Expenses:
Property operating expenses	1,510		1,510
General and administrative expenses	143,703	$ 4,679	408,901	$ 10,462
Acquisition related costs	1,207,188		1,207,188
Business management fee	22,864		22,864
Total expenses	1,375,265	$ 4,679	1,640,463	$ 10,462
Operating loss	(1,364,824)	(4,679)	(1,630,022)	(10,462)
Net loss	$ (1,364,824)	$ (4,679)	$ (1,630,022)	$ (10,462)
Net loss per common share, basic and diluted	$ (43.30)	$ (0.58)	$ (102.35)	$ (1.31)
Weighted average number of common shares outstanding, basic and diluted	31,520	8,000	15,926	8,000

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SEGMENT REPORTING

9 Months Ended

Sep. 30, 2015

Segment Reporting [Abstract]

SEGMENT REPORTING

NOTE 6 – SEGMENT REPORTING

The Company has one reportable segment, multifamily real estate, as defined by U.S. GAAP for the nine months ended September 30, 2015 and 2014.

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MORTGAGES PAYABLE

9 Months Ended

Sep. 30, 2015

Debt Disclosure [Abstract]

MORTGAGES PAYABLE

NOTE 5 – MORTGAGES PAYABLE

As of September 30, 2015, the Company’s mortgage loan is secured by a first mortgage on the property.

Property Name	Stated Interest Rate Per Annum	Principal Balance at September 30, 2015		Principal Balance at December 31, 2014		Maturity Date	Notes
The Retreat at Market Square	3.95%	$	45,750,000	$	—	September 30, 2016	(a)

(a) The loan requires monthly payments of interest only until the maturity date. Subject to certain conditions, the Company has a one-time option to extend the maturity date for an additional seven year period to September 30, 2023. If extended, the mortgage loan would bear interest at a fixed rate equal to 3.79%. During the initial one-year term of the loan, the Sponsor has agreed to guarantee the payment of (i) all real estate taxes on the property which accrue or become due during the term of the loan, (ii) all Costs and Expenses, as defined, and (iii) any and all losses, damages, costs or expenses of the lender, which arise in consequence of certain events, as defined, provided that the guaranteed obligation will be limited to the payment of $9,150,000, plus enforcement costs. The Company has not paid, and will not pay, any fees or other consideration to the Sponsor for this guarantee.

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ACQUISITIONS (Schedule of 2015 Acquisitions) (Details) - The Retreat at Market Square [Member]	9 Months Ended
	Sep. 30, 2015 USD ($) ft² Units
Business Acquisition [Line Items]
Property acquisition, date acquired	Sep. 30, 2015
Property acquisition, location	Frederick, MD
Property acquisition, total number of units acquired | Units	206
Property acquisition, square footage	194,732
Property acquisition, purchase price | $	$ 45,727,557

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ORGANIZATION (Details) - USD ($)	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 09, 2015	Dec. 31, 2014
Class of Stock [Line Items]
Total value of common stock company is authorized to sell through initial 'reasonable best efforts' offering	$ 1,000,000,000
Common stock, par value	$ .001			$ .001
Number of common shares Sponsor received, subsequently converted in Class A Common Stock	8,000
Number of Class A shares issued as result of Sponsor converting common shares	8,000
Limit on number of shares that can be repurchased each calendar year expressed as a percentage of common stock outstanding on December 31st of the previous calendar year	5.00%
Advances from sponsor	$ 2,650,000
Class A Common Stock [Member]
Class of Stock [Line Items]
Common stock, par value	$ .001			.001
Price of each common share authorized to be sold through intial public 'best efforts' offering	25.00
Initial price of each common share authorized pursuant to distribution reinvestment plan	23.75
Adjusted price of each common share authorized pursuant to distribution reinvestment plan	$ 25.00
Shares sold during period	87,680.842
Advances from sponsor	$ 2,000,000
Equity issuance, price per share	$ 22.81
Approximate total proceeds raised in offering			$ 2,348,800
Class T Common Stock [Member]
Class of Stock [Line Items]
Common stock, par value	.001			$ .001
Price of each common share authorized to be sold through intial public 'best efforts' offering	23.95
Initial price of each common share authorized pursuant to distribution reinvestment plan	22.81
Adjusted price of each common share authorized pursuant to distribution reinvestment plan	$ 23.95
Class A and Class T Common Stock [Member]
Class of Stock [Line Items]
Total value of common stock company is authorized to sell pursuant to distribution reinvestment plan	$ 190,000,000

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies)

9 Months Ended

Sep. 30, 2015

Accounting Policies [Abstract]

General

General

The accompanying consolidated financial statements have been prepared in accordance with U.S. GAAP and require management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates.

Consolidation

Consolidation

The accompanying consolidated financial statements include the accounts of the Company, as well as Inland Residential Operating Partnership, L.P., of which the Company is the sole general partner, and the accounts of the Company’s wholly owned subsidiary. All intercompany balances and transactions have been eliminated in consolidation.

Partially-Owned Entities

Partially-Owned Entities

The Company will consolidate the operations of a joint venture if the Company determines that it is either the primary beneficiary of a variable interest entity or “VIE” or has substantial influence and control of the entity. The primary beneficiary is the party that has the ability to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb losses and right to receive the returns from the VIE that would be significant to the VIE. There are significant judgments and estimates involved in determining the primary beneficiary of a VIE or the determination of who has control and influence of the entity. When the Company consolidates an entity, the assets, liabilities and results of operations will be included in the Company’s consolidated financial statements.

In instances where the Company determines that it is not the primary beneficiary of a VIE or the Company does not control the joint venture but can exercise influence over the entity with respect to its operations and major decisions, the Company will use the equity method of accounting. Under the equity method, the operations of a joint venture will not be consolidated with the Company’s operations but instead its share of operations will be reflected as equity in earnings (loss) on unconsolidated entity on the Company’s consolidated statements of operations. Additionally, the Company’s net investment in the joint venture will be reflected as investment in unconsolidated entity on the consolidated balance sheets.

Offering and Organization Costs

Offering and Organization Costs

Costs associated with the Offering are deferred and charged against the gross proceeds of the Offering upon the sale of shares. Formation and organizational costs were expensed as incurred. Deferred Offering costs were $2,614,621 at December 31, 2014 and are included in deferred costs, net in the accompanying consolidated financial statements.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all demand deposits, money market accounts and all short term investments with a maturity of three months or less, at the date of purchase, to be cash equivalents. The Company maintains its cash and cash equivalents at financial institutions. The account balance may periodically exceed the Federal Deposit Insurance Corporation (“FDIC”) insurance coverage and, as a result, there could be a concentration of credit risk related to amounts on deposit in excess of FDIC insurance coverage. The Company believes that the risk will not be significant, as the Company does not anticipate the financial institutions’ non-performance.

Acquisitions

Acquisitions

Upon acquisition, the Company determines the total purchase price of each property (see Note 4 – “Acquisitions”), which includes the estimated contingent consideration to be paid or received in future periods, if any. The Company allocates the total purchase price of properties based on the fair value of the tangible and intangible assets acquired and liabilities assumed based on Level 3 inputs, such as comparable sales values, discount rates, capitalization rates, revenue and expense growth rates and lease-up assumptions, from a third party appraisal or other market sources. Such tangible assets include land, building improvements, furniture, fixtures and equipment and such intangible assets include acquired above market and below market leases, in place lease value and any assumed financing that is determined to be above or below market terms.

The Company expenses acquisition costs of all transactions as incurred. All costs related to finding, analyzing and negotiating a transaction are expensed as incurred as acquisition related costs, whether or not the acquisition is completed. These expenses include acquisition fees paid to the Business Manager.

Impairment

Impairment

The Company assesses the carrying values of the respective long-lived assets, whenever events or changes in circumstances indicate that the carrying amounts of these assets may not be fully recoverable. If it is determined that the carrying value is not recoverable because the undiscounted cash flows do not exceed the carrying value, the Company will be required to record an impairment loss to the extent that the carrying value exceeds fair value. The valuation and possible subsequent impairment of real estate properties will be a significant estimate that can change based on the Company’s continuous process of analyzing each property and reviewing assumptions about inherently uncertain factors, as well as the economic condition of the property at a particular point in time.

Cost Capitalization and Depreciation Policies

Cost Capitalization and Depreciation Policies

Real estate acquisitions are recorded at cost less accumulated depreciation. Improvements and betterment costs will be capitalized and ordinary repairs and maintenance will be expensed as incurred.

Depreciation expense is computed using the straight-line method. Buildings and improvements are depreciated on a straight-line basis based upon estimated useful lives of thirty years for buildings and improvements, and five to fifteen years for furniture, fixtures and equipment and site improvements. Loan fees are amortized on a straight-line basis, which approximates the effective interest method, over the life of the related loan as a component of interest expense. The portion of the purchase price allocated to acquired above market lease costs and acquired below market lease costs is amortized on a straight-line basis over the life of the related lease (including renewal periods for below market leases with fixed rate renewals) as an adjustment to net rental income. Acquired in-place lease costs and other leasing costs are amortized on a straight-line basis over the weighted-average remaining lease term as a component of amortization expense.

Cost capitalization and the estimate of useful lives require judgment and include significant estimates that can and do change.

Fair Value Measurements

Fair Value Measurements

The Company estimates fair value using available market information and valuation methodologies it believes to be appropriate for these purposes. Considerable judgment and a high degree of subjectivity are involved in developing these estimates and, accordingly, they will not necessarily be indicative of amounts that would be realized upon disposition.

The Company defines fair value based on the price that would be received upon sale of an asset or the exit price that would be paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company has established a fair value hierarchy that prioritizes observable and unobservable inputs used to measure fair value. The fair value hierarchy will consist of three broad levels, which are described below:

▪	Level 1 −	Quoted prices in active markets for identical assets or liabilities that the entity has the ability to access.
▪	Level 2 −	Observable inputs, other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.
▪	Level 3 −	Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets and liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

Revenue Recognition

Revenue Recognition

Rental income attributable to leases is recorded on a straight-line basis, which is not materially different than if it were recorded when due from residents, and recognized monthly as it was earned. Leases entered into between a resident and a property for the rental of an apartment unit will generally be year-to-year, renewable upon consent of both parties. Retail/commercial leases will generally have five to ten year lease terms with market based renewal options. 

Valuation of Accounts and Rents Receivable

Valuation of Accounts and Rents Receivable

The Company takes into consideration certain factors that require judgments to be made as to the collectability of receivables. Collectability factors taken into consideration are the amounts outstanding, payment history and financial strength of the tenant, which taken as a whole determines the valuation.

Income Taxes

Income Taxes

Income taxes are accounted for under the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences and are attributable to (1) differences between the financial statement carrying amounts and their respective tax bases, and (2) net operating losses. A valuation allowance is established for uncertainties relating to realization of deferred tax assets. At September 30, 2015 and December 31, 2014, the Company had a deferred tax asset of approximately $726,017 and $74,000, respectively, for which a valuation allowance was recorded in the same amount due to the uncertainty of realization.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In September 2015, the Financial Accounting Standards Board (the “FASB”) issued Accounting Standards Update (“ASU”) No. 2015-16, Business Combinations - Simplifying the Accounting for Measurement-Period Adjustments. The amendments in the ASU eliminate the requirement of an acquirer to retrospectively account for provisional amounts that are identified during the measurement period after a business combination. This ASU requires an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amount is determined. The ASU also requires the acquirer to disclose the amount recorded in current-period earnings, by line item, that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The ASU is effective for fiscal years beginning after December 15, 2015, including interim periods within those fiscal years. Early adoption is permitted for financial statements that have not been issued and will be applied prospectively to adjustments to provisional amounts that occur after the effective date. The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, Interest - Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs. The ASU requires that debt issuance costs be deducted from the carrying value of the financial liability and not recorded as separate assets, classified as deferred financing costs. The ASU is effective for public entities for financial statements issued for fiscal years beginning after December 15, 2015. Early adoption is permitted for financial statements that have not been previously issued and will be applied on a retrospective basis. The Company does not expect adoption of this ASU to have a material impact on its consolidated financial statements.

In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of promised goods or services to customers. The ASU will replace most existing revenue recognition guidance in U.S. GAAP when it becomes effective, although it will not affect the accounting for rental related revenues. The new standard is effective for the Company on January 1, 2018. Early adoption is permitted but not prior to the original effective date of January 1, 2017. The standard permits the use of either the retrospective or cumulative effect transition method. The Company is evaluating the effect that ASU No. 2014-09 will have on its consolidated financial statements and related disclosures. The Company has not yet selected a transition method nor has it determined the effect of the standard on its ongoing financial reporting.

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TRANSACTIONS WITH RELATED PARTIES

9 Months Ended

Sep. 30, 2015

Related Party Transactions [Abstract]

TRANSACTIONS WITH RELATED PARTIES

NOTE 7 – TRANSACTIONS WITH RELATED PARTIES

The Sponsor contributed $200,000 to the capital of the Company for which it received 8,000 shares of common stock which were subsequently converted into 8,000 shares of Class A common stock. On September 9, 2015, the Company sold 87,680.842 shares of Class A common stock to the Sponsor for an aggregate purchase price of $2,000,000, or $22.81 per share.

Since inception, the Sponsor has advanced $2,950,000 in cash to the Company, which is included in due to related parties on the accompanying consolidated balance sheets, to partially fund formation, offering and organization costs.

As of September 30, 2015, the Company had incurred $3,817,104 of offering and organization costs. Pursuant to the terms of the Offering, the Business Manager will repay all offering and organization expenses (excluding selling commissions) in excess of 2.0% of the gross proceeds of the Offering or all offering and organization expenses (including selling commissions) which together exceed 10.75% of the gross offering proceeds from Class A Shares and 6.75% of the gross offering proceeds from Class T Shares, sold in the primary offering over the life of the Offering.

The following table summarizes the Company’s related party transactions for the three and nine months ended September 30, 2015 and 2014 and as of September 30, 2015 and December 31, 2014.

		Three months ended September 30,				Nine months ended September 30,				Amount Unpaid as of
		2015		2014		2015		2014		September 30, 2015		December 31, 2014
General and administrative expenses	(a)	$	61,168	$	—	$	147,548	$	—	$	81,253	$	95,289
Organization costs	(b)		—		225		—		1,610		—		—
Acquisition related costs	(c)		719,148		—		719,148		—		686,250		—
Offering costs	(d)		25,278		57,413		145,958		71,603		1,034,665		1,137,378
Business management fee	(e)		22,864		—		22,864		—		22,864		—
Mortgage financing fee	(f)		114,375		—		114,375		—		114,375		—
Sponsor non-interest bearing advances	(g)		450,000		—		2,650,000		—		2,950,000		300,000

(a)	The Business Manager and its affiliates are entitled to reimbursement for certain general and administrative expenses relating to the Company’s administration. Such costs are included in general and administrative expenses in the accompanying consolidated statements of operations. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. The Company established a discount stock purchase policy for related parties that enables them to purchase shares of common stock at $22.81 per share. The Company sold 3,683 shares to related parties during the nine months ended September 30, 2015.
(b)	The Business Manager or its affiliates will pay or reimburse any organization or offering costs, including any issuer costs, that exceed 10.75% of the gross offering proceeds from Class A Shares, and 6.75% of the gross offering proceeds from Class T Shares sold in the “reasonable best efforts” offering over the life of the Offering.
(c)	The Company pays the Business Manager or its affiliates a fee equal to 1.5% of the “contract purchase price,” as defined, of each property and real estate-related asset acquired.  The Business Manager and its affiliates are also reimbursed for acquisition and transaction related costs of the Business Manager and its affiliates relating to the Company’s acquisition of real estate assets, regardless of whether the Company acquires the real estate assets, subject to limits, as defined.  Such costs are included in acquisition related costs in the accompanying consolidated statements of operations.  Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets.
(d)	The Company reimburses the Sponsor and its affiliates for costs and other expenses of the Offering that they pay on the Company’s behalf.  Offering costs are offset against the stockholders’ equity accounts. Unpaid amounts are included in due to related parties in the accompanying consolidated balance sheets. An affiliate of the Business Manager also receives selling commissions equal to 6.0% of the sale price for each Class A Share sold and 2.0% of the sale price for each Class T Share sold and a dealer manager fee equal to 2.75% of the sale price for each share sold, the majority of which is re-allowed (paid) to third party soliciting dealers. The Company does not pay selling commissions or the dealer manager fee in connection with shares issued through the DRP.
(e)	The Company pays the Business Manager an annual business management fee equal to 0.6% of its “average invested assets,” payable quarterly in an amount equal to 0.15% of the Company’s average invested assets as of the last day of the immediately preceding quarter. “Average invested assets” means, for any period, the average of the aggregate book value of the Company’s assets, including all intangibles and goodwill, invested, directly or indirectly, in equity interests in, and loans secured by, properties, as well as amounts invested in securities or consolidated and unconsolidated joint ventures or other partnerships, before reserves for amortization and depreciation or bad debts, impairments or other similar non-cash reserves, computed by taking the average of these values at the end of each month during the relevant calendar quarter.
(f)	The Company pays the Business Manager, or its affiliates, a mortgage financing fee equal to 0.25% of the amount available or borrowed under the financing or the assumed debt if the Business Manager or its affiliates provides services in connection with the origination or refinancing of any debt that the Company obtains and uses to finance properties or other assets, or that is assumed, directly or indirectly, in connection with the acquisition of properties or other assets.
(g)	This amount on the accompanying consolidated balance sheets contains non-interest bearing advances made by the Sponsor which the Company intends to repay.

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SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2015

Subsequent Events [Abstract]

SUBSEQUENT EVENTS

NOTE 8 – SUBSEQUENT EVENTS

On October 20, 2015, the Company’s board of directors authorized a daily cash dividend of $0.003424658 per Class A Share and $0.002768493 per Class T Share, payable to stockholders of record each day beginning on the close of business on November 1, 2015 through the close of business on November 30, 2015.

In addition, on October 20, 2015, the Company’s board of directors authorized a monthly stock dividend of 0.000833333 Class A Shares per Class A Share owned and 0.000833333 Class T Shares per Class T Share owned, payable to stockholders of record at the close of business on November 30, 2015.

Distributions declared for the month of November will be paid and distributed no later than December 7, 2015.

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ACQUISITIONS (Tables)

9 Months Ended

Sep. 30, 2015

Business Combinations [Abstract]

Schedule of 2015 Acquisitions

2015 Acquisitions

Date Acquired	Property Name	Location	Total Number of Units	Square Footage		Purchase Price
9/30/15	The Retreat at Market Square	Frederick, MD	206		194,732	$	45,727,557

Schedule of Major Assets Acquired and Liabilities Assumed

The following table presents certain additional information regarding the Company’s acquisition during the nine months ended September 30, 2015. The amounts recognized for major assets acquired as of the acquisition date are as follows:

Property Name	Land		Building and Improvements		Furniture, Fixtures and Equipment		Acquired Lease Intangibles
The Retreat at Market Square	$	6,301,838	$	37,591,342	$	1,232,754	$	601,623

Schedule of Pro Forma Financial Information for Acquisitions

The following condensed pro forma consolidated financial statements for the three and nine months ended September 30, 2015 and 2014 include pro forma adjustments related to the acquisition and financing during 2015. The 2015 acquisition is presented assuming the acquisition occurred on January 1, 2014. Acquisition expenses for both the three and nine months ended September 30, 2015 of $1,207,188, related to the acquisition, are not expected to have a continuing impact and, therefore, have been excluded from these pro forma results.

	Three months ended September 30,						Nine months ended September 30,
	2015			2014			2015			2014
Pro forma total income	$	942,215		$	382,621		$	2,630,318		$	593,608
Pro forma net loss	$	(575,275	)	$	(921,691	)	$	(1,649,628	)	$	(3,215,658	)
Loss per share	$	(5.18	)	$	(8.30	)	$	(14.85	)	$	(28.95	)

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INCOME TAX (Details) - USD ($)	3 Months Ended		9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014	Sep. 30, 2015	Sep. 30, 2014
Income Tax Contingency [Line Items]
Uncertain tax positions
Interest or penalties relating to income taxes recognized in the consolidated statements of operations
Minimum [Member]
Income Tax Contingency [Line Items]
Open tax year			2013
Maximum [Member]
Income Tax Contingency [Line Items]
Open tax year			2014

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MORTGAGES PAYABLE (Details) - The Retreat at Market Square [Member] - USD ($)		9 Months Ended
		Sep. 30, 2015	Dec. 31, 2014
Debt Instrument [Line Items]
Debt instrument, interest rate	[1]	3.95%
Outstanding principal balance	[1]	$ 45,750,000
Debt instrument, maturity date	[1]	Sep. 30, 2016
Interest rate on mortgage loan if maturity date is extended		3.79%
Maximum guarantee obligation for Sponsor		$ 9,150,000

[1] The loan requires monthly payments of interest only until the maturity date. Subject to certain conditions, the Company has a one-time option to extend the maturity date for an additional seven year period to September 30, 2023. If extended, the mortgage loan would bear interest at a fixed rate equal to 3.79%. During the initial one-year term of the loan, the Sponsor has agreed to guarantee the payment of (i) all real estate taxes on the property which accrue or become due during the term of the loan, (ii) all Costs and Expenses, as defined, and (iii) any and all losses, damages, costs or expenses of the lender, which arise in consequence of certain events, as defined, provided that the guaranteed obligation will be limited to the payment of $9,150,000, plus enforcement costs. The Company has not paid, and will not pay, any fees or other consideration to the Sponsor for this guarantee.

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CONSOLIDATED STATEMENT OF EQUITY (DEFICIT) - 9 months ended Sep. 30, 2015 - USD ($)	Common Stock [Member]	Additional Paid in Capital [Member]	Retained Earnings (Deficit) [Member]	Total
Balance at Dec. 31, 2014	$ 8	$ 199,992	$ (185,021)	$ 14,979
Balance, shares at Dec. 31, 2014	8,000
Proceeds from the offering	$ 103	$ 2,357,697		2,357,800
Proceeds from the offering, shares	103,058
Offering costs		$ (3,754,008)		(3,754,008)
Discount on shares to related parties		$ 8,065		8,065
Net loss			$ (1,630,022)	(1,630,022)
Balance at Sep. 30, 2015	$ 111	$ (1,188,254)	$ (1,815,043)	$ (3,003,186)
Balance, shares at Sep. 30, 2015	111,058

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ACQUISITIONS

9 Months Ended

Sep. 30, 2015

Business Combinations [Abstract]

ACQUISITIONS

NOTE 4 - ACQUISITIONS

2015 Acquisitions

Date Acquired	Property Name	Location	Total Number of Units	Square Footage		Purchase Price
9/30/15	The Retreat at Market Square	Frederick, MD	206		194,732	$	45,727,557

During the nine months ended September 30, 2015, the Company acquired, through its wholly owned subsidiary, the real estate property above by borrowing $45,750,000 in mortgage debt that is secured by a first priority mortgage on the property.

For properties acquired during the nine months ended September 30, 2015, the Company recorded revenue of $10,441 and property net income of $8,931 which excludes expensed acquisition related costs.

The Company incurred $1,207,188 and $0 during the three months ended September 30, 2015 and 2014, respectively, and $1,207,188 and $0 during the nine months ended September 30, 2015 and 2014, respectively, of acquisition, dead deal and transaction related costs. These costs include third party due diligence costs such as appraisals, environmental studies, and legal fees as well as acquisition fees and time and travel expense reimbursements to the Sponsor and its affiliates.

The following table presents certain additional information regarding the Company’s acquisition during the nine months ended September 30, 2015. The amounts recognized for major assets acquired as of the acquisition date are as follows:

Property Name	Land		Building and Improvements		Furniture, Fixtures and Equipment		Acquired Lease Intangibles
The Retreat at Market Square	$	6,301,838	$	37,591,342	$	1,232,754	$	601,623

Pro Forma Disclosures

The following condensed pro forma consolidated financial statements for the three and nine months ended September 30, 2015 and 2014 include pro forma adjustments related to the acquisition and financing during 2015. The 2015 acquisition is presented assuming the acquisition occurred on January 1, 2014. Acquisition expenses for both the three and nine months ended September 30, 2015 of $1,207,188, related to the acquisition, are not expected to have a continuing impact and, therefore, have been excluded from these pro forma results.

	Three months ended September 30,						Nine months ended September 30,
	2015			2014			2015			2014
Pro forma total income	$	942,215		$	382,621		$	2,630,318		$	593,608
Pro forma net loss	$	(575,275	)	$	(921,691	)	$	(1,649,628	)	$	(3,215,658	)
Loss per share	$	(5.18	)	$	(8.30	)	$	(14.85	)	$	(28.95	)

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SEGMENT REPORTING (Details) - Segments	9 Months Ended
	Sep. 30, 2015	Sep. 30, 2014
Segment Reporting [Abstract]
Number of reportable segments	1	1

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SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Details) - USD ($)	Sep. 30, 2015	Dec. 31, 2014
Accounting Policies [Abstract]
Deferred costs, net	$ 136,930	$ 2,614,621
Deferred tax asset, gross	726,017	74,000
Deferred tax asset valuation allowance	$ 726,017	$ 74,000