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INTEREST RATE SWAP DERIVATIVES | 12 Months Ended
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Dec. 31, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
INTEREST RATE SWAP DERIVATIVES | INTEREST RATE SWAP DERIVATIVES The Company, through its limited liability company subsidiaries, has entered into interest rate swap agreements with amortizing notational amounts relating to four of its mortgage notes payable. The notional amount is an indication of the extent of the Company’s involvement in each instrument at that time, but does not represent exposure to credit, interest rate or market risks. The Company acquired eight additional derivative instruments for certain mortgage notes payable as a result of the Merger with REIT I effective December 31, 2019. The following table summarizes the notional amount and other information related to the Company’s interest rate swaps as of December 31, 2019 and 2018.
|  | December 31, 2019 |  | December 31, 2018
Derivative Instruments |  | Number of Instruments |  | Notional Amount (i) |  | Reference Rate (ii) |  | Weighted Average Fixed Pay Rate |  | Weighted Average Remaining Term |  | Number of Instruments |  | Notional Amount (i) |  | Reference Rate (iii) |  | Weighted Average Fixed Pay Rate |  | Weighted Average Remaining Term
Interest Rate Swap Derivatives |  | 12 |  | $ | 48,215,139 |  |  | One-month LIBOR + applicable spread/Fixed at 1.21%-5.16% |  | 3.87 | % |  | 2.9 years |  | 4 |  |  | $ | 27,346,400 |  |  | One-month LIBOR + applicable spread/Fixed at 4.05%-5.16% |  | 4.73 | % |  | 5.1 years
(i) | The notional amount of the Company’s swaps decreases each month to correspond to the outstanding principal balance on the related mortgage. The minimum notional amounts (outstanding principal balance at the maturity date) as of December 31, 2019 and 2018 were $45,514,229 and $24,936,799, respectively.
(ii) | The reference rate was December 31, 2019.
(iii) | The reference rate was December 31, 2018.
The following table sets forth the fair value of the Company’s derivative instruments (Level 2 measurement), as well as their classification in the consolidated balance sheets:
|  |  |  | December 31, 2019 |  | December 31, 2018
Derivative Instrument |  | Balance Sheet Location |  | Number of Instruments |  | Fair Value |  | Number of Instruments |  | Fair Value
Interest Rate Swaps |  | Asset - Interest rate swap derivatives, at fair value (*) |  | 5 |  | $ | 34,567 |  |  | 2 |  |  | $ | 151,215 |
Interest Rate Swaps |  | Liability - Interest rate swap derivatives, at fair value (*) |  | 7 |  | $ | (1,021,724 | ) |  | 2 |  |  | $ | (300,929 | )
(*) | The fair value of the five interest rate swap derivative assets and three interest rate derivative liabilities acquired from REIT I were $34,567 and $(51,514), respectively, as of December 31, 2019.
The change in fair value of a derivative instrument that is not designated as a cash flow hedge for financial accounting purposes is recorded as interest expense in the consolidated statements of operations. None of the Company’s derivatives at December 31, 2019 or 2018 were designated as hedging instruments; therefore, the net unrealized losses recognized on interest rate swaps of $970,210 and $149,714, respectively, were recorded as increases in interest expense for year ended December 31, 2019 and 2018, respectively (see Note 7).

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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