Investment Properties (Tables)
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9 Months Ended |
Sep. 30, 2016 |
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| Real Estate [Abstract] |
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| Investment properties |
Investment properties consist of the following:
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September 30, 2016 |
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December 31, 2015 |
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(unaudited) |
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Land and land improvements |
$ |
71,835,953 |
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$ |
50,777,143 |
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Land held for improvement |
11,370,497 |
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12,353,963 |
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Buildings and improvements |
227,405,802 |
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188,338,469 |
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Investment properties at cost |
310,612,252 |
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251,469,575 |
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Less accumulated depreciation and amortization |
(18,399,995 |
) |
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(12,704,944 |
) |
Investment properties, net |
$ |
292,212,257 |
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$ |
238,764,631 |
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| Summary of AC portfolio properties |
The A-C Portfolio consists of the following properties:
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Property Name |
Location |
Square Feet |
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Darien Shopping Center |
Darien, GA |
26,001 |
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Devine Street |
Columbia, SC |
38,464 |
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Folly Road |
Charleston, SC |
47,794 |
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Georgetown |
Georgetown, SC |
29,572 |
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Ladson Crossing |
Ladson, SC |
52,607 |
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Lake Greenwood Crossing |
Greenwood, SC |
47,546 |
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Lake Murray |
Lexington, SC |
39,218 |
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Litchfield Market Village |
Pawleys Island, SC |
86,740 |
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Moncks Corner |
Moncks Corner, SC |
26,800 |
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Ridgeland |
Ridgeland, SC |
20,029 |
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Shoppes at Myrtle Park |
Bluffton, SC |
56,380 |
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South Lake |
Lexington, SC |
44,318 |
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South Park |
Mullins, SC |
60,874 |
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St. Matthews |
St. Matthews, SC |
29,015 |
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| Schedule of preliminary fair values of assets acquired and liabilities assumed |
The following summarizes the consideration paid and the preliminary fair values of assets acquired and liabilities assumed in conjunction with the acquisitions described above, along with a description of the methods used to determine fair value. In determining fair values, the Company considered many factors including, but not limited to, cash flows, market cap rates, location, occupancy rates, appraisals, other acquisitions and management’s knowledge of the current acquisition market for similar properties. The valuation and purchase price allocation for this acquisition are preliminary, but are expected to be finalized by March 31, 2017.
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A-C Portfolio |
Preliminary fair value of assets acquired and liabilities assumed: |
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Investment property (a) |
$ |
58,595,869 |
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Lease intangibles and other assets (b) |
12,124,143 |
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Above market leases (c) |
2,942,219 |
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Below market leases (c) |
(2,662,231 |
) |
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Preliminary fair value of net assets acquired: |
$ |
71,000,000 |
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Purchase consideration: |
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Consideration paid with cash and debt |
$ |
69,000,000 |
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Consideration paid with common units |
2,000,000 |
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Total consideration (d) |
$ |
71,000,000 |
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a. |
Represents the preliminary fair value of the net investment properties acquired which includes land, buildings, site improvements and tenant improvements. The preliminary fair value was determined using following approaches: |
i. the market approach valuation methodology for land by considering similar transactions in the markets;
ii. a combination of the cost approach and income approach valuation methodologies for buildings, including replacement cost evaluations, “go dark” analyses and residual calculations incorporating the land values; and
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iii. |
the cost approach valuation methodology for site and tenant improvements, including replacement costs and prevailing quoted market rates. |
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b. |
Represents the preliminary fair value of lease intangibles and other assets. Lease intangibles include leasing commissions, in place leases and tenant relationships associated with replacing existing leases. The income approach was used to determine the fair value of these intangible assets which included estimated market rates and expenses. It was determined that carrying value approximated fair value for other asset amounts. |
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c. |
Represents the fair value of above/below market leases. The income approach was used to determine the fair value of above/below market leases using market rental rates for similar properties. |
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d. |
Represents the components of purchase consideration paid. |
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| Pro forma financial Information |
Unaudited pro forma financial information in the aggregate is presented below for the acquisitions of the A-C Portfolio. The unaudited pro forma information presented below includes the effects of the acquisition as if it had been consummated as of the beginning of the prior fiscal year. The pro forma results include adjustments for depreciation and amortization associated with acquired tangible and intangible assets, straight-line rent adjustments, interest expense related to debt incurred and adjustments attributable to the increase in noncontrolling interests relating to the incremental common units used as consideration in the acquisition of the A-C Portfolio.
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Three Months Ended
September 30, |
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Nine Months Ended
September 30, |
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2016 |
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2015 |
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2016 |
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2015 |
Rental revenue |
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$ |
8,589,194 |
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$ |
7,350,934 |
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$ |
25,685,635 |
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$ |
18,879,018 |
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Net loss from continuing operations |
$ |
(1,597,272 |
) |
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$ |
(7,865,805 |
) |
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$ |
(9,210,053 |
) |
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$ |
(18,495,390 |
) |
Net loss attributable to Wheeler REIT |
$ |
(1,441,117 |
) |
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$ |
(7,105,404 |
) |
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$ |
(7,572,955 |
) |
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$ |
(16,420,232 |
) |
Net loss attributable to Wheeler REIT common shareholders |
$ |
(2,681,928 |
) |
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$ |
(22,509,817 |
) |
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$ |
(9,836,365 |
) |
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$ |
(102,180,970 |
) |
Basic loss per share |
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$ |
(0.04 |
) |
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$ |
(0.36 |
) |
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$ |
(0.15 |
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$ |
(3.43 |
) |
Diluted loss per share |
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$ |
(0.04 |
) |
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$ |
(0.36 |
) |
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$ |
(0.15 |
) |
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$ |
(3.43 |
) |
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