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Real Estate and Intangible Assets | 9 Months Ended
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Sep. 30, 2016
Real Estate [Abstract] |
REAL ESTATE AND INTANGIBLE ASSETS | REAL ESTATE AND INTANGIBLE ASSETS All of our properties are wholly owned on a fee-simple basis. The following table provides certain summary information about our 56 farms as of September 30, 2016:
Property Name |  | Location |  | Date Acquired |  | No. of Farms |  | Total Acres |  | Farm Acres |  | Lease Expiration Date |  |  | Net Cost Basis(1) |  | Encumbrances(2) |
San Andreas |  | Watsonville, CA |  | 6/16/1997 |  | 1 |  | 307 |  | 238 |  | 12/31/2020 |  |  | $ | 4,756,950 |  |  | $ | 7,702,672 |  |
West Gonzales |  | Oxnard, CA |  | 9/15/1998 |  | 1 |  | 653 |  | 502 |  | 6/30/2020 |  |  | 12,066,248 |  |  | 30,017,766 |  |
West Beach |  | Watsonville, CA |  | 1/3/2011 |  | 3 |  | 196 |  | 195 |  | 12/31/2023 |  |  | 9,277,502 |  |  | 6,717,183 |  |
Dalton Lane |  | Watsonville, CA |  | 7/7/2011 |  | 1 |  | 72 |  | 70 |  | 10/31/2020 |  |  | 2,675,171 |  |  | 1,590,375 |  |
Keysville Road |  | Plant City, FL |  | 10/26/2011 |  | 2 |  | 61 |  | 56 |  | 6/30/2020 |  |  | 1,239,430 |  |  | 897,600 |  |
Colding Loop |  | Wimauma, FL |  | 8/9/2012 |  | 1 |  | 219 |  | 181 |  | 8/4/2017 |  |  | 3,865,019 |  |  | 2,640,000 |  |
Trapnell Road |  | Plant City, FL |  | 9/12/2012 |  | 3 |  | 124 |  | 110 |  | 6/30/2017 | (3) |  | 3,837,986 |  |  | 2,389,500 |  |
38th Avenue |  | Covert, MI |  | 4/5/2013 |  | 1 |  | 119 |  | 89 |  | 4/4/2020 |  |  | 1,246,393 |  |  | 759,506 |  |
Sequoia Street |  | Brooks, OR |  | 5/31/2013 |  | 1 |  | 218 |  | 206 |  | 5/31/2028 |  |  | 3,082,764 |  |  | 1,755,757 |  |
Natividad Road |  | Salinas, CA |  | 10/21/2013 |  | 1 |  | 166 |  | 166 |  | 10/31/2024 |  |  | 8,923,059 |  |  | 3,964,611 |  |
20th Avenue |  | South Haven, MI |  | 11/5/2013 |  | 3 |  | 151 |  | 94 |  | 11/4/2018 |  |  | 1,832,760 |  |  | 1,132,746 |  |
Broadway Road |  | Moorpark, CA |  | 12/16/2013 |  | 1 |  | 60 |  | 46 |  | 12/15/2023 |  |  | 2,873,371 |  |  | 1,699,119 |  |
Oregon Trail |  | Echo, OR |  | 12/27/2013 |  | 1 |  | 1,895 |  | 1,640 |  | 12/31/2023 |  |  | 13,993,354 |  |  | 7,929,221 |  |
East Shelton |  | Willcox, AZ |  | 12/27/2013 |  | 1 |  | 1,761 |  | 1,320 |  | 2/29/2024 |  |  | 7,730,123 |  |  | 4,717,887 |  |
Collins Road |  | Clatskanie, OR |  | 5/30/2014 |  | 2 |  | 200 |  | 157 |  | 9/30/2024 |  |  | 2,341,601 |  |  | 1,529,207 |  |
Spring Valley |  | Watsonville, CA |  | 6/13/2014 |  | 1 |  | 145 |  | 110 |  | 9/30/2022 |  |  | 5,731,872 |  |  | 3,922,133 |  |
McIntosh Road |  | Dover, FL |  | 6/20/2014 |  | 2 |  | 94 |  | 78 |  | 6/30/2017 | (4) |  | 2,441,053 |  |  | 1,439,640 |  |
Naumann Road |  | Oxnard, CA |  | 7/23/2014 |  | 1 |  | 68 |  | 66 |  | 7/31/2017 |  |  | 6,773,068 |  |  | 3,902,310 |  |
Sycamore Road |  | Arvin, CA |  | 7/25/2014 |  | 1 |  | 326 |  | 322 |  | 10/31/2024 |  |  | 6,829,362 |  |  | 4,379,762 |  |
Wauchula Road |  | Duette, FL |  | 9/29/2014 |  | 1 |  | 808 |  | 590 |  | 9/30/2024 |  |  | 13,450,170 |  |  | 7,433,100 |  |
Santa Clara Avenue |  | Oxnard, CA |  | 10/29/2014 |  | 2 |  | 333 |  | 331 |  | 7/31/2017 |  |  | 24,135,194 |  |  | 14,159,324 |  |
Dufau Road |  | Oxnard, CA |  | 11/4/2014 |  | 1 |  | 65 |  | 64 |  | 11/3/2017 |  |  | 6,016,522 |  |  | 3,675,000 |  |
Espinosa Road |  | Salinas, CA |  | 1/5/2015 |  | 1 |  | 331 |  | 329 |  | 10/31/2020 |  |  | 16,111,013 |  |  | 10,178,000 |  |
Parrish Road |  | Duette, FL |  | 3/10/2015 |  | 1 |  | 419 |  | 412 |  | 6/30/2025 |  |  | 4,141,521 |  |  | 2,374,680 |  |
Immokalee Exchange |  | Immokalee, FL |  | 6/25/2015 |  | 2 |  | 2,678 |  | 1,644 |  | 6/30/2020 |  |  | 15,467,267 |  |  | 9,360,000 |  |
Holt County |  | Stuart, NE |  | 8/20/2015 |  | 1 |  | 1,276 |  | 1,052 |  | 12/31/2018 |  |  | 5,423,218 |  |  | 3,301,000 |  |
Rock County |  | Bassett, NE |  | 8/20/2015 |  | 1 |  | 1,283 |  | 1,049 |  | 12/31/2018 |  |  | 5,406,522 |  |  | 3,301,000 |  |
Bear Mountain |  | Arvin, CA |  | 9/3/2015 |  | 3 |  | 854 |  | 841 |  | 1/9/2031 |  |  | 26,828,964 |  |  | 12,559,887 |  |
Corbitt Road |  | Immokalee, FL |  | 11/2/2015 |  | 1 |  | 691 |  | 390 |  | 12/31/2021 |  |  | 3,755,637 |  |  | 3,714,880 |  |
Reagan Road |  | Willcox, AZ |  | 12/22/2015 |  | 1 |  | 1,239 |  | 875 |  | 12/31/2025 |  |  | 5,750,597 |  |  | 3,639,000 |  |
Gunbarrel Road |  | Alamosa, CO |  | 3/3/2016 |  | 3 |  | 6,191 |  | 4,730 |  | 2/28/2021 |  |  | 25,015,493 |  |  | 15,303,500 |  |
Calaveras Avenue |  | Coalinga, CA |  | 4/5/2016 |  | 1 |  | 453 |  | 435 |  | 10/31/2025 |  |  | 15,290,013 |  |  | 9,282,000 |  |
Orange Avenue |  | Fort Pierce, FL |  | 7/1/2016 |  | 1 |  | 401 |  | 400 |  | 6/30/2023 |  |  | 5,113,269 |  |  | 3,091,761 |  |
Lithia Road |  | Lithia, FL |  | 8/11/2016 |  | 1 |  | 72 |  | 55 |  | 5/31/2021 |  |  | 1,700,469 |  |  | 1,020,000 |  |
Baca County |  | Edler, CO |  | 9/1/2016 |  | 5 |  | 7,384 |  | 6,785 |  | 12/31/2020 |  |  | 6,385,779 |  |  | — |  | (5)
Diego Ranch |  | Stanislaus, CA |  | 9/14/2016 |  | 1 |  | 1,357 |  | 1,309 |  | 11/15/2019 |  |  | 13,997,610 |  |  | — |  | (5)
Nevada Ranch |  | Merced, CA |  | 9/14/2016 |  | 1 |  | 1,130 |  | 1,021 |  | 11/15/2019 |  |  | 13,231,638 |  |  | — |  | (5)
|  |  |  |  |  | 56 |  | 33,800 |  | 27,958 |  |  |  |  | $ | 308,737,982 |  |  | $ | 191,480,127 |  |
(1) | Consists of the initial acquisition price (including the costs allocated to both tangible and intangible assets acquired and liabilities assumed), plus subsequent improvements and other capitalized costs associated with the properties, and adjusted for accumulated depreciation and amortization. Includes Investments in real estate, net (excluding improvements paid for by the tenant) and Lease intangibles, net; plus net above-market lease values included in Other assets; and less net below-market lease values, deferred revenue and unamortized tenant improvements included in Other liabilities, each as shown on the accompanying Condensed Consolidated Balance Sheet.
(2) | Excludes approximately $1.1 million of deferred financing costs related to mortgage notes and bonds payable included in Mortgage notes and bonds payable, net on the accompanying Condensed Consolidated Balance Sheet.
(3) | There are three agricultural leases and one commercial lease on this property. Each of the agricultural leases expires on June 30, 2017, and the commercial lease expires on June 30, 2018.
(4) | There are two leases in place on this property, one expiring on June 30, 2017, and the other expiring on June 30, 2019.
(5) | Pledged as collateral under the MetLife Facility subsequent to September 30, 2016. See Note 10, "Subsequent Events," for further discussion.
Real Estate The following table sets forth the components of our investments in tangible real estate assets as of September 30, 2016, and December 31, 2015:
|  | September 30, 2016 |  | December 31, 2015
Real estate: |  |  |  |
Land and land improvements |  | $ | 251,906,593 |  |  | $ | 192,020,381 |
Irrigation systems |  | 33,355,718 |  |  | 21,849,508 |
Buildings |  | 14,670,759 |  |  | 11,184,647 |
Horticulture |  | 14,281,209 |  |  | 1,490,695 |
Other improvements |  | 4,804,376 |  |  | 1,872,606 |
Real estate, at cost |  | 319,018,655 |  |  | 228,417,837 |
Accumulated depreciation |  | (9,781,651 | ) |  | (6,634,412 | )
Real estate, net |  | $ | 309,237,004 |  |  | $ | 221,783,425 |
Real estate depreciation expense on these tangible assets was $1,224,612 and $3,161,434 for the three and nine months ended September 30, 2016, respectively, and $595,539 and $1,647,177 for the three and nine months ended September 30, 2015, respectively. Included in the figures above are amounts related to improvements on certain of our properties paid for by our tenants but owned by us, or tenant improvements. As of September 30, 2016, and December 31, 2015, we recorded tenant improvements, net of accumulated depreciation, of $1,882,114 and $1,302,009, respectively. We recorded both depreciation expense and additional rental revenue related to these tenant improvements of $30,753 and $98,225 during the three and nine months ended September 30, 2016, respectively, and $14,780 and $27,502 for the three and nine months ended September 30, 2015, respectively. Intangible Assets and Liabilities The following table summarizes the carrying values of lease intangible assets and the related accumulated amortization as of September 30, 2016, and December 31, 2015:
|  | September 30, 2016 |  | December 31, 2015
Lease intangibles: |  |  |  |
In-place leases |  | $ | 1,727,483 |  |  | $ | 1,225,955 |
Leasing costs |  | 1,086,846 |  |  | 677,112 |
Tenant relationships |  | 886,743 |  |  | 886,743 |
Lease intangibles, at cost |  | 3,701,072 |  |  | 2,789,810 |
Accumulated amortization |  | (1,585,987 | ) |  | (1,026,269 | )
Lease intangibles, net |  | $ | 2,115,085 |  |  | $ | 1,763,541 |
Total amortization expense related to these lease intangible assets was $207,234 and $582,095 for the three and nine months ended September 30, 2016, respectively, and $193,621 and $645,448 for the three and nine months ended September 30, 2015, respectively. The following table summarizes the carrying values of certain lease intangible assets or liabilities included in Other assets and Other liabilities, respectively, on the accompanying Condensed Consolidated Balance Sheets and the related accumulated amortization or accretion, respectively, as of September 30, 2016, and December 31, 2015.
|  | September 30, 2016 |  | December 31, 2015
Intangible Asset or Liability |  | Deferred Rent Asset (Liability) |  | Accumulated (Amortization) Accretion |  | Deferred Rent Asset (Liability) |  | Accumulated (Amortization) Accretion
Above-market lease values(1) |  | $ | 19,528 |  |  | $ | (12,422 | ) |  | $ | 19,528 |  |  | $ | (7,540 | )
Below-market lease values and deferred revenue(2) |  | (785,917 | ) |  | 46,818 |  |  | (202,579 | ) |  | 23,205 |
|  | $ | (766,389 | ) |  | $ | 34,396 |  |  | $ | (183,051 | ) |  | $ | 15,665 |
(1) | Above-market lease values are included as part of Other assets in the accompanying Condensed Consolidated Balance Sheets, and the related amortization is recorded as a reduction of rental income.
(2) | Below-market lease values and deferred revenue are included as a part of Other liabilities in the accompanying Condensed Consolidated Balance Sheets, and the related accretion is recorded as an increase to rental income.
Total amortization related to above-market lease values and deferred revenue was $1,627 and $4,882 for the three and nine months ended September 30, 2016, respectively, and $4,496 and $15,286 for the three and nine months ended September 30, 2015, respectively. Total accretion related to below-market lease values and deferred revenue was $8,951 and $23,613 for the three and nine months ended September 30, 2016, respectively, and $52,591 and $160,324 for the three and nine months ended September 30, 2015, respectively. New Real Estate Activity Certain acquisitions during the periods presented were accounted for as business combinations in accordance with ASC 805, as there was a prior leasing history on the property. As such, the fair value of all assets acquired and liabilities assumed were determined in accordance with ASC 805, and all acquisition-related costs were expensed as incurred, other than those costs directly related to reviewing or assigning leases that we assumed upon acquisition, which were capitalized as part of leasing costs. For acquisitions accounted for as asset acquisitions under ASC 360, all acquisition-related costs were capitalized and included as part of the fair value allocation of the identifiable tangible assets acquired, other than those costs that directly related to originating new leases we executed upon acquisition, which were capitalized as part of leasing costs. In addition, total consideration for acquisitions may include a combination of cash and equity securities, such as OP Units. When OP Units are issued in connection with acquisitions, we determine the fair value of the OP Units issued based on the number of units issued multiplied by the closing price of the Company’s common stock on the date of acquisition. 2016 New Real Estate Activity During the nine months ended September 30, 2016, we acquired 13 new farms in seven separate transactions, which are summarized in the table below.
Property Name |  | Property Location |  | Acquisition Date |  | Total Acreage |  | No. of Farms |  | Primary Crop(s) |  | Lease Term |  | Renewal Options |  | Total Purchase Price |  | Acquisition Costs |  | Annualized Straight-line Rent(1) |  | Net Long-term Debt Issued
Gunbarrel Road (2) |  | Alamosa, CO |  | 3/3/2016 |  | 6,191 |  | 3 |  | Organic Potatoes |  | 5 years |  | 1 (5 years) |  | $ | 25,735,815 |  |  | $ | 119,085 |  | (3) | $ | 1,590,614 |  |  | $ | 15,531,000 |
Calaveras Avenue |  | Coalinga, CA |  | 4/5/2016 |  | 453 |  | 1 |  | Pistachios |  | 10 years |  | 1 (5 years) |  | 15,470,000 |  |  | 38,501 |  | (4) | 773,500 |  | (5) | 9,282,000 |
Orange Avenue |  | Fort Pierce, FL |  | 7/1/2016 |  | 401 |  | 1 |  | Vegetables |  | 7 years |  | 2 (7 years) |  | 5,100,000 |  |  | 37,615 |  | (4) | 291,173 |  |  | 3,120,000 |
Lithia Road |  | Plant City, FL |  | 8/11/2016 |  | 72 |  | 1 |  | Strawberries |  | 5 years |  | None |  | 1,700,000 |  |  | 38,296 |  | (3) | 97,303 |  |  | 1,020,000 |
Baca County(6) |  | Edler, CO |  | 9/1/2016 |  | 7,384 |  | 5 |  | Grass Hay and Alfalfa |  | 4 years |  | 1 (5 years) |  | 6,322,853 |  |  | 72,340 |  | (4) | 383,734 |  |  | — |
Diego Ranch(7) |  | Stanislaus, CA |  | 9/14/2016 |  | 1,357 |  | 1 |  | Almonds |  | 3 years |  | 3 (5 years) & 1 (3 years) |  | 13,996,606 |  |  | 63,114 |  | (3) | 621,115 |  |  | — |
Nevada Ranch |  | Merced, CA |  | 9/14/2016 |  | 1,130 |  | 1 |  | Almonds |  | 3 years |  | 3 (5 years) & 1 (3 years) |  | 13,231,832 |  |  | 40,833 |  | (3) | 574,274 |  |  | — |
|  |  |  |  |  | 16,988 |  | 13 |  |  |  |  |  |  |  | $ | 81,557,106 |  |  | $ | 409,784 |  |  | $ | 4,331,713 |  |  | $ | 28,953,000 |
(1) | Annualized straight-line amount is based on the minimum cash rental payments guaranteed under the lease, as required under GAAP.
(2) | As partial consideration for the acquisition of this property, we issued 745,879 OP Units, constituting an aggregate fair value of approximately $6.5 million as of the acquisition date. We incurred $25,500 of legal costs in connection with the issuance of these OP Units.
(3) | Acquisition accounted for as a business combination under ASC 805. In aggregate, $9,520 of these costs related to direct leasing costs incurred in connection with these acquisitions.
(4) | Acquisition accounted for as an asset acquisition under ASC 360.
(5) | Lease provides for a variable rent component based on the gross crop revenues earned on the property. The figure above represents only the minimum cash rents guaranteed under the lease.
(6) | As partial consideration for the acquisition of this property, we issued 125,677 OP Units, constituting an aggregate fair value of approximately $1.5 million as of the acquisition date. We incurred approximately $8,235 of legal costs in connection with the issuance of these OP Units.
(7) | As partial consideration for the acquisition of this property, we issued 343,750 OP Units, constituting an aggregate fair value of approximately $3.9 million as of the acquisition date. We incurred approximately $21,732 of legal costs in connection with the issuance of these OP Units.
The preliminary allocation of the purchase price for the farms acquired during the nine months ended September 30, 2016, are as follows:
Property Name |  | Land and Land Improvements |  | Buildings |  | Irrigation Systems |  | Other Improvements |  | Horticulture |  | In-place Leases |  | Leasing Costs |  | Above (Below)- Market Lease |  | Total Purchase Price
Gunbarrel Road |  | $ | 16,755,814 |  |  | $ | 3,438,291 |  |  | $ | 2,830,738 |  |  | $ | 2,079,102 |  |  | $ | — |  |  | $ | 381,977 |  |  | $ | 249,893 |  |  | — |  |  | $ | 25,735,815 |
Calaveras Avenue |  | 3,615,436 |  |  | — |  |  | 424,112 |  |  | — |  |  | 11,430,452 |  |  | — |  |  | — |  |  | — |  |  | 15,470,000 |
Orange Avenue |  | 4,135,741 |  |  | 29,777 |  |  | 934,482 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 5,100,000 |
Lithia Road |  | 1,461,090 |  |  | 10,656 |  |  | 213,325 |  |  | — |  |  | — |  |  | 7,739 |  |  | 16,265 |  |  | (9,075 | ) |  | 1,700,000 |
Baca County |  | 6,111,287 |  |  | 211,566 |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 6,322,853 |
Diego Ranch |  | 14,136,135 |  |  | — |  |  | 45,535 |  |  | — |  |  | — |  |  | 58,535 |  |  | 73,337 |  |  | (316,936 | ) |  | 13,996,606 |
Nevada Ranch |  | 12,863,790 |  |  | — |  |  | 505,196 |  |  | — |  |  | — |  |  | 53,276 |  |  | 66,895 |  |  | (257,325 | ) |  | 13,231,832 |
|  | $ | 59,079,293 |  |  | $ | 3,690,290 |  |  | $ | 4,953,388 |  |  | $ | 2,079,102 |  |  | $ | 11,430,452 |  |  | $ | 501,527 |  |  | $ | 406,390 |  |  | $ | (583,336 | ) |  | $ | 81,557,106 |
The allocation of the purchase price for the property acquired during the nine months ended September 30, 2016, is preliminary and may change during the measurement period if we obtain new information regarding the assets acquired or liabilities assumed at the acquisition date. Below is a summary of the total operating revenues and earnings recognized on the properties acquired during the three and nine months ended September 30, 2016:
|  |  |  | For the three months ended September 30, 2016 |  | For the nine months ended September 30, 2016
Property Name |  | Acquisition Date |  | Operating Revenues |  | Earnings(1) |  | Operating Revenues |  | Earnings(1)
Gunbarrel Road |  | 3/3/2016 |  | $ | 397,654 |  |  | $ | (28,515 | ) |  | $ | 919,306 |  |  | $ | (180,491 | )
Calaveras Avenue |  | 4/5/2016 |  | 193,375 |  |  | (8,478 | ) |  | 377,240 |  |  | (11,321 | )
Orange Avenue |  | 7/1/2016 |  | 72,793 |  |  | 15,884 |  |  | 72,793 |  |  | 15,884 |
Lithia Road |  | 8/11/2016 |  | 13,601 |  |  | (28,607 | ) |  | 13,601 |  |  | (28,607 | )
Baca County |  | 9/1/2016 |  | 31,978 |  |  | 30,799 |  |  | 31,978 |  |  | 30,799 |
Diego Ranch |  | 9/14/2016 |  | 31,056 |  |  | (10,070 | ) |  | 31,056 |  |  | (10,070 | )
Nevada Ranch |  | 9/14/2016 |  | 28,714 |  |  | (12,921 | ) |  | 28,714 |  |  | (12,921 | )
|  |  |  | $ | 769,171 |  |  | $ | (41,908 | ) |  | $ | 1,474,688 |  |  | $ | (196,727 | )
(1) | In aggregate, includes $128,161 and $229,476 of non-recurring acquisition-related costs during the three and nine months ended September 30, 2016, respectively.
2015 New Real Estate Activity During the nine months ended September 30, 2015, we acquired nine new farms in six separate transactions, which are summarized in the table below.
Property Name |  | Property Location |  | Acquisition Date |  | Total Acreage |  | No. of Farms |  | Primary Crop(s) |  | Lease Term |  | Renewal Options |  | Total Purchase Price |  | Acquisition Costs |  | Annualized Straight-line Rent(1) |  | Net Long-term Debt Issued
Espinosa Road(2) |  | Salinas, CA |  | 1/5/2015 |  | 331 |  | 1 |  | Strawberries |  | 1.8 years |  | None |  | $ | 16,905,500 |  |  | $ | 89,885 |  | (3) | $ | 778,342 |  |  | $ | 10,178,000 |
Parrish Road |  | Duette, FL |  | 3/10/2015 |  | 419 |  | 1 |  | Strawberries |  | 10.3 years |  | 2 (5 years) |  | 3,913,280 |  |  | 103,610 |  | (3) | 251,832 |  |  | 2,374,680 |
Immokalee Exchange |  | Immokalee, FL |  | 6/25/2015 |  | 2,678 |  | 2 |  | Misc. Vegetables |  | 5.0 years |  | 2 (5 years) |  | 15,757,700 |  |  | 152,571 |  | (3) | 960,104 |  |  | 9,360,000 |
Holt County |  | Stuart, NE |  | 8/20/2015 |  | 1,276 |  | 1 |  | Misc. Vegetables |  | 3.4 years |  | None |  | 5,504,000 |  |  | 27,589 |  | (3) | 289,815 |  |  | 3,301,000 |
Rock County |  | Bassett, NE |  | 8/20/2015 |  | 1,283 |  | 1 |  | Misc. Vegetables |  | 3.4 years |  | None |  | 5,504,000 |  |  | 27,589 |  | (3) | 289,815 |  |  | 3,301,000 |
Bear Mountain |  | Arvin, CA |  | 9/3/2015 |  | 854 |  | 3 |  | Almonds |  | 15.4 years |  | 1 (10 years) |  | 18,922,500 |  |  | 117,742 |  | (4) | 1,115,992 |  |  | 21,138,196 |
|  |  |  |  |  | 6,841 |  | 9 |  |  |  |  |  |  |  | $ | 66,506,980 |  |  | $ | 518,986 |  |  | $ | 3,685,900 |  |  | $ | 49,652,876 |
(1) | Annualized straight-line amount is based on the minimum cash rental payments guaranteed under the lease.
(2) | In connection with this acquisition, our Adviser earned a finder’s fee of $320,905, which the Adviser fully credited back to us during the nine months ended September 30, 2015. See Note 6, “Related-Party Transactions” for further discussion on this fee.
(3) | Acquisition accounted for as a business combination under ASC 805. In aggregate, $11,825 of these costs related to direct leasing costs incurred in connection with these acquisitions.
(4) | Acquisition accounted for as an asset acquisition under ASC 360.
The allocation of the purchase price for the farms acquired during the the nine months ended September 30, 2015, were as follows:
Property Name |  | Land and Land Improvements |  | Buildings and Improvements |  | Irrigation System |  | In-place Leases |  | Leasing Costs |  | Tenant Relationships |  | Total Purchase Price
Espinosa Road |  | $ | 15,852,466 |  |  | $ | 84,478 |  |  | $ | 497,401 |  |  | $ | 246,472 |  |  | $ | 43,894 |  |  | $ | 180,789 |  |  | $ | 16,905,500 |
Parrish Road |  | 2,403,064 |  |  | 42,619 |  |  | 1,299,851 |  |  | 54,405 |  |  | 77,449 |  |  | 35,892 |  |  | 3,913,280 |
Immokalee Exchange |  | 14,410,840 |  |  | 273,107 |  |  | 515,879 |  |  | 229,406 |  |  | 148,691 |  |  | 179,777 |  |  | 15,757,700 |
Holt County |  | 4,690,369 |  |  | 56,253 |  |  | 729,884 |  |  | — |  |  | 27,494 |  |  | — |  |  | 5,504,000 |
Rock County |  | 4,862,313 |  |  | 72,232 |  |  | 540,589 |  |  | — |  |  | 28,866 |  |  | — |  |  | 5,504,000 |
Bear Mountain |  | 18,428,247 |  |  | — |  |  | 494,253 |  |  | — |  |  | — |  |  | — |  |  | 18,922,500 |
|  | $ | 60,647,299 |  |  | $ | 528,689 |  |  | $ | 4,077,857 |  |  | $ | 530,283 |  |  | $ | 326,394 |  |  | $ | 396,458 |  |  | $ | 66,506,980 |
Below is a summary of the total operating revenues and earnings recognized on the properties acquired during the three and nine months ended September 30, 2015:
|  |  |  | For the three months ended September 30, 2015 |  | For the nine months ended September 30, 2015
Property Name |  | Acquisition Date |  | Operating Revenues |  | Earnings(1) |  | Operating Revenues |  | Earnings(1)
Espinosa Road |  | 1/5/2015 |  | $ | 194,586 |  |  | $ | (2,922 | ) |  | $ | 575,387 |  |  | $ | (53,281 | )
Parrish Road |  | 3/10/2015 |  | 62,958 |  |  | (10,175 | ) |  | 140,133 |  |  | (106,362 | )
Immokalee Exchange |  | 6/25/2015 |  | 240,026 |  |  | 94,302 |  |  | 240,026 |  |  | (60,045 | )
Holt County |  | 8/20/2015 |  | 33,500 |  |  | (6,075 | ) |  | 33,500 |  |  | (6,075 | )
Rock County |  | 8/20/2015 |  | 33,500 |  |  | (7,927 | ) |  | 33,500 |  |  | (7,927 | )
Bear Mountain |  | 9/3/2015 |  | 64,430 |  |  | 59,023 |  |  | 64,430 |  |  | 59,023 |
|  |  |  | $ | 629,000 |  |  | $ | 126,226 |  |  | $ | 1,086,976 |  |  | $ | (174,667 | )
(1) | In aggregate, includes $75,293 and $413,374 of non-recurring acquisition-related costs during the three and nine months ended September 30, 2015, respectively.
Acquired Intangibles and Liabilities The following table shows the weighted-average amortization period, in years, for the intangible assets acquired and liabilities assumed in connection with new real estate acquired as part of business combinations during the nine months ended September 30, 2016 and 2015:
|  | Weighted-Average Amortization Period (in Years)
Intangible Assets and Liabilities |  | 2016 |  | 2015
In-place leases |  | 8.7 |  |  | 4.1 |
Leasing costs |  | 10.6 |  |  | 5.5 |
Tenant relationships |  | — |  |  | 9.5 |
Below-market lease values and deferred revenue |  | 20.9 |  |  | — |
All intangible assets and liabilities | 14.0 |  |  | 6.2 |
Pro-Forma Financials During each of the nine months ended September 30, 2016 and 2015, we acquired six farms in transactions that qualified as business combinations. The following table reflects pro-forma consolidated financial information as if each farm acquired as part of a business combination was acquired on January 1 of the respective prior fiscal year. In addition, pro-forma earnings have been adjusted to assume that acquisition-related costs related to these farms were incurred at the beginning of the previous fiscal year.
|  | For the Three Months Ended September 30, |  | For the Nine Months Ended September 30,
|  | 2016 |  | 2015 |  | 2016 |  | 2015
|  | (Unaudited) |  | (Unaudited) |  | (Unaudited) |  | (Unaudited)
Operating Data: |  |  |  |  |  |  |  |
Total operating revenue |  | $ | 4,718,052 |  |  | $ | 3,460,986 |  |  | $ | 13,285,819 |  |  | $ | 8,864,148 |
Net income attributable to the company |  | $ | 211,822 |  |  | $ | (176,949 | ) |  | $ | 593,599 |  |  | $ | 914,580 |
Share and Per-share Data: |  |  |  |  |  |  |  |
Earnings per share of common stock – basic and diluted |  | $ | 0.02 |  |  | $ | (0.02 | ) |  | $ | 0.06 |  |  | $ | 0.10 |
Weighted-average common shares outstanding – basic and diluted |  | 10,018,331 |  |  | 9,060,314 |  |  | 10,001,466 |  |  | 9,060,314 |
The pro-forma consolidated results are prepared for informational purposes only. They are not necessarily indicative of what our consolidated financial condition or results of operations actually would have been assuming the acquisitions had occurred at the beginning of the respective previous periods, nor do they purport to represent our consolidated financial position or results of operations for future periods. Significant Existing Real Estate Activity On February 1, 2016, we completed certain irrigation improvements on Sycamore Road to increase overall water availability at a total cost of $993,319. As stipulated in the lease agreement with our tenant, we will earn additional rent on the total cost commensurate with the annual yield on the farmland, which will result in additional straight-line rental income of $53,550 per year throughout the remaining lease term. On February 8, 2016, we renewed the lease with the tenant occupying one of our McIntosh Road farms, which was set to expire on June 30, 2016. The lease was renewed for an additional three years, through June 30, 2019, with annualized, straight-line rental income of $63,000, representing a 17.9% increase over that of the previous lease. On April 5, 2016, we reimbursed the tenant occupying Wauchula Road for $569,607 of costs incurred to construct certain irrigation improvements on the farm. As stipulated in the lease, as of April 1, 2016, we began earning an additional $92,634 of annualized, straight-line rental income on this farm throughout the remaining lease term. On April 5, 2016, we reimbursed the tenant occupying Parrish Road for $500,000 of our portion of the costs incurred to construct certain irrigation improvements on the farm. As stipulated in the lease, as of April 1, 2016, we began earning an additional $139,073 of annualized, straight-line rental income on this farm throughout the remaining lease term. In addition, in connection with our acquisition of Parrish Road in March 2015, we committed to providing $745,000 as additional compensation and reimbursements of certain costs, contingent upon the approval by a local water management district of increases in certain water permits on the property. These water permits were approved on June 28, 2016, and we remitted $745,000 to the tenant, who was also the seller of the property, on June 30, 2016. On July 5, 2016, we received payment of approximately $164,000 (including $4,000 of accrued interest) from the California Department of Transportation ("CalTrans") in connection with the settlement of the eminent domain lawsuit for 4.5 acres of nonfarmable land on Espinosa Road. The portion of this payment allocated to our cost basis of the 4.5 nonfarmable acres was approximately $156,000, which was previously included in Investments in real estate, net on our Condensed Consolidated Balance Sheet. On July 15, 2016, we terminated the lease with the tenant occupying Colding Loop prior to its expiration, and, on August 5, 2016, we entered into a new lease with a new tenant to occupy the property. The new lease is scheduled to expire on August 4, 2017, and provides for minimum rental payments of $72,400 over its term. In connection with the early termination of the previous lease, we wrote off $20,697 and $84,600 of deferred rent asset balances to bad debt expense during the three and nine months ended September 30, 2016, respectively. In addition, during the three months ended September 30, 2016, we expensed $8,635 of unamortized leasing costs associated with the previous lease. On August 25, 2016, we renewed the lease with the tenant occupying Espinosa Road, which was originally set to expire on October 31, 2016. The lease was renewed for an additional four years, through October 31, 2020, with annualized, straight-line rental income of $997,017, representing a 28.1% increase over that of the previous lease. In connection with the renewal, we also assumed the responsibility for the property taxes on Espinosa Road, which were the tenant's responsibility under the old lease. Property taxes on Espinosa Road are approximately $144,000 for the property tax assessment year ending June 30, 2017. Portfolio Diversification and Concentrations Diversification The following table summarizes the geographic locations, by state, of our properties with leases in place as of September 30, 2016 and 2015:
|  | As of and For the Nine Months Ended September 30, 2016 |  | As of and For the Nine Months Ended September 30, 2015
|  | Number |  |  |  | % of |  |  |  | % of Total |  | Number |  |  |  | % of |  |  |  | % of Total
|  | of |  | Total |  | Total |  | Rental |  | Rental |  | of |  | Total |  | Total |  | Rental |  | Rental
State |  | Farms |  | Acres |  | Acres |  | Revenue |  | Revenue |  | Farms |  | Acres |  | Acres |  | Revenue |  | Revenue
California |  | 21 |  | 6,516 |  |  | 19.3 | % |  | $ | 6,986,099 |  |  | 56.4 | % |  | 18 |  | 3,576 |  |  | 24.0 | % |  | $ | 5,652,357 |  |  | 66.6 | %
Florida |  | 15 |  | 5,567 |  |  | 16.5 | % |  | 2,407,893 |  |  | 19.4 | % |  | 12 |  | 4,401 |  |  | 29.6 | % |  | 1,458,433 |  |  | 17.2 | %
Colorado |  | 8 |  | 13,575 |  |  | 40.1 | % |  | 951,285 |  |  | 7.7 | % |  | — |  | — |  |  | — |  |  | — |  |  | — | %
Oregon |  | 4 |  | 2,313 |  |  | 6.8 | % |  | 877,547 |  |  | 7.1 | % |  | 4 |  | 2,313 |  |  | 15.6 | % |  | 876,244 |  |  | 10.3 | %
Arizona |  | 2 |  | 3,000 |  |  | 8.9 | % |  | 543,642 |  |  | 4.4 | % |  | 1 |  | 1,761 |  |  | 11.8 | % |  | 243,953 |  |  | 2.9 | %
Nebraska |  | 2 |  | 2,559 |  |  | 7.6 | % |  | 434,722 |  |  | 3.5 | % |  | 2 |  | 2,559 |  |  | 17.2 | % |  | 67,000 |  |  | 0.8 | %
Michigan |  | 4 |  | 270 |  |  | 0.8 | % |  | 187,115 |  |  | 1.5 | % |  | 4 |  | 270 |  |  | 1.8 | % |  | 185,036 |  |  | 2.2 | %
|  | 56 |  | 33,800 |  |  | 100.0 | % |  | $ | 12,388,303 |  |  | 100.0 | % |  | 41 |  | 14,880 |  |  | 100.0 | % |  | $ | 8,483,023 |  |  | 100.0 | %
Concentrations Credit Risk As of September 30, 2016, our farms were leased to 39 different, third-party tenants, with certain tenants leasing more than one farm. Dole Food Company (“Dole”) leases two of our farms, and aggregate rental revenue attributable to Dole accounted for approximately $2.2 million, or 17.8% of the rental revenue recorded during the nine months ended September 30, 2016. If Dole fails to make rental payments or elects to terminate its leases, and the properties cannot be re-leased on satisfactory terms, there could be a material adverse effect on our financial performance and ability to continue operations. No other individual tenant represented greater than 10.0% of the total rental revenue recorded during the nine months ended September 30, 2016. Geographic Risk 21 of our 56 farms owned as of September 30, 2016, are located in California, and 15 farms are located in Florida. As of September 30, 2016, our farmland in California accounted for 6,516 acres, or 19.3% of the total acreage we owned. Furthermore, these farms accounted for approximately $7.0 million, or 56.4% of the rental revenue recorded during the nine months ended September 30, 2016. However, these farms are spread across three of the many different growing regions within California. As of September 30, 2016, our farmland in Florida accounted for 5,567 acres, or 16.5% of the total acreage we owned, and these farms accounted for approximately $2.4 million, or 19.4%, of the rental revenue recorded during the nine months ended September 30, 2016. Though we seek to continue to further diversify geographically, as may be desirable or feasible, should an unexpected natural disaster occur where our properties are located, there could be a material adverse effect on our financial performance and ability to continue operations. No other single state accounted for more than 10.0% of the total rental revenue recorded during the nine months ended September 30, 2016.

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