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Basis of Presentation and Principles of Consolidation | 9 Months Ended
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Sep. 30, 2023
Business and Organization |
Basis of Presentation and Principles of Consolidation | Note 2—Basis of Presentation and Principles of Consolidation Basis of Presentation—The accompanying unaudited combined and consolidated financial statements have been prepared in conformity with the instructions to Form 10-Q and Article 10-01 of Regulation S-X for interim financial statements. Accordingly, they do not include all the information and footnotes required by generally accepted accounting principles in the United States of America (“GAAP”) for complete financial statements. These unaudited combined and consolidated financial statements and related notes should be read in conjunction with the combined and consolidated financial statements and related notes included in the Information Statement. The preparation of these combined and consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that 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 revenues and expenses during the reporting periods. Actual results could differ from those estimates. In the opinion of management, the accompanying combined and consolidated financial statements contain all adjustments consisting of normal recurring adjustments necessary for a fair statement of the results for the interim periods presented. Such operating results may not be indicative of the expected results for any other interim periods or the entire year. The combined and consolidated financial statements of the Company prior to the Spin-off on March 31, 2023 represented a combination of entities under common control that have been “carved out” from iStar’s consolidated financial statements. Historically, financial statements of the Company have not been prepared as it was not operated separately from iStar. These combined and consolidated financial statements reflect the revenues and expenses of the Company and include certain assets and liabilities that were included in the Spin-Off, which have been reflected at iStar’s historical basis. All intercompany balances and transactions have been eliminated. The combined and consolidated financial statements may not be indicative of the Company’s future performance and do not necessarily reflect what the financial position, results of operations and cash flows would have been had the Company operated as a standalone company during the periods presented. ​ These combined and consolidated financial statements include an allocation of general and administrative expenses and interest expense to the Company from iStar through the date of the Spin-Off. General and administrative expenses include certain iStar corporate functions, including executive oversight, treasury, finance, human resources, tax compliance and planning, internal audit, financial reporting, information technology and investor relations. General and administrative expenses, including stock-based compensation, represent a pro rata allocation of costs from iStar’s real estate finance, operating properties, land and development and corporate business segments based on the Company’s average net assets for those segments as a percentage of iStar’s average net assets for those segments. Interest expense, net of amounts capitalized, was allocated to the Company by calculating the Company’s average net assets as a percentage of the average net assets in iStar’s segments and multiplying that percentage by the interest expense allocated to iStar’s segments. The Company believes the allocation methodology for general and administrative expenses and interest expense is reasonable. Accordingly, the general and administrative expense and interest expense allocations presented in our combined and consolidated statements of operations for historical periods does not necessarily reflect what our general and administrative expenses and interest expense will be as a standalone public company. For the three months ended September 30, 2022, the Company was allocated $7.0 million of general and administrative expense and $9.5 million of interest expense. For the three months ended September 30, 2022, the general and administrative expense allocation includes ($0.2) million of stock-based compensation (refer to Note 3). For the nine months ended September 30, 2023 and 2022, the Company was allocated $14.1 million and $5.9 million, respectively, of general and administrative expense and $8.0 million and $33.3 million, respectively, of interest expense. For the nine months ended September 30, 2023 and 2022, the general and administrative expense allocation includes $1.8 million and ($13.2) million, respectively, of stock-based compensation (refer to Note 3). Subsequent to the Spin-Off, the Company has its own general and administrative expense and interest expense as a stand-alone public company. ​ Prior to the Spin-Off, certain of the entities included in the Company’s financial statements did not have bank accounts for the periods presented, and certain cash transactions for the Company were transacted through bank accounts owned by iStar. The combined and consolidated statements of cash flows for the periods presented were prepared as if operating, investing and financing transactions for the Company had been transacted through its own bank accounts. ​ Principles of Combination and Consolidation—The combined and consolidated financial statements include on a carve-out basis the historical balance sheets and statements of operations and cash flows of assets, liabilities and operations included in the Spin-Off. For periods prior to March 31, 2023, the Company was allocated a number of shares of Safe common stock based on estimates driven by the total value of stock that iStar expected to contribute to the Company and the price per share of Safe common stock (refer to Note 7). Information for the periods subsequent to March 31, 2023 reflect the actual number of Safe Shares contributed to the Company. Consolidated VIEs—The Company consolidates VIEs for which it is considered the primary beneficiary. The liabilities of these VIEs are non-recourse to the Company and can only be satisfied from each VIE’s respective assets. The Company did not have any unfunded commitments related to consolidated VIEs as of September 30, 2023 and December 31, 2022. The following table presents the assets and liabilities of the Company’s consolidated VIEs as of September 30, 2023 and December 31, 2022 ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | As of
​ |  | September 30, 2023 |  | December 31, 2022
ASSETS | ​ | ​ |  |  | ​ |
Real estate | ​ | ​ |  |  | ​ |
Real estate, at cost | ​ | $ | 94,624 | ​ | $ | 94,159
Less: accumulated depreciation | ​ |  | (20,505) | ​ |  | (18,033)
Real estate, net | ​ |  | 74,119 | ​ |  | 76,126
Land and development, net | ​ |  | 112,662 | ​ |  | 128,717
Cash and cash equivalents | ​ |  | 18,610 | ​ |  | 3,754
Accrued interest and operating lease income receivable, net | ​ |  | 23 | ​ |  | —
Deferred operating lease income receivable, net | ​ |  | 7 | ​ |  | 6
Deferred expenses and other assets, net | ​ |  | 7,331 | ​ |  | 6,921
Total assets | ​ | $ | 212,752 | ​ | $ | 215,524
LIABILITIES | ​ |  |  | ​ |  |
Accounts payable, accrued expenses and other liabilities | ​ | $ | 26,198 | ​ | $ | 24,406
Total liabilities | ​ |  | 26,198 | ​ |  | 24,406
​ Unconsolidated VIEs—The Company had investments in VIEs where it was not the primary beneficiary and accordingly the VIEs have not been consolidated in the Company’s combined and consolidated financial statements. As of December 31, 2022, the Company’s maximum exposure to loss from these investments does not exceed the sum of the $32.1 million carrying value of the investments, which are classified in “Other investments” on the Company’s combined and consolidated balance sheets.

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