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Commitments and Contingencies | 3 Months Ended
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Mar. 31, 2021
Commitments and Contingencies Disclosure [Abstract] |
Commitments and Contingencies |
| 13. | COMMITMENTS AND CONTINGENCIES
Lots Sales Agreement On November 23, 2015, SeD Maryland Development LLC completed the $15,700,000 acquisition of Ballenger Run, a 197-acre land sub-division development located in Frederick County, Maryland. Previously, on May 28, 2014, the RBG Family, LLC entered into a $15,000,000 assignable real estate sales contract with NVR, by which RBG Family, LLC would facilitate the sale of the 197 acres of Ballenger Run to NVR. On December 10, 2014, NVR assigned this contract to SeD Maryland Development, LLC through execution of an assignment and assumption agreement and entered into a series of lot purchase agreements by which NVR would purchase 443 subdivided residential lots from SeD Maryland Development, LLC. On December 31, 2018, SeD Maryland entered into the Third Amendment to the Lot Purchase Agreement for Ballenger Run with NVR. Pursuant to the Third Amendment, SeD Maryland will convert the 5.9 acre CCRC parcel to 36 lots (the 28 feet wide villa lot) and sell to NVR. Through the three months ended on March 31, 2021 and 2020, NVR purchased 27 lots and 27 lots, respectively. Through March 31, 2021 and December 31, 2020, NVR had purchased a total of 415 and 388 lots, respectively. Leases The Company leases offices in Maryland, Singapore, Magnolia, Texas, Hong Kong and South Korea through leased spaces aggregating approximately 15,811 square feet, under leases expiring on various dates from December 2020 to March 2024. The leases have rental rates ranging from $2,265 to $23,297 per month. Our total rent expense under these office leases was $140,271 and $85,558 in the three months ended March 31, 2021 and 2020, respectively. The following table outlines the details of lease terms:
Office Location |  | Lease Term as of December 31, 2020 |  | Renewed Lease term in 2021
Singapore |  | June 2020 to June 2021 |  |
Hong Kong |  | October 2020 to October 2022 |  |
South Korea |  | August 2020 to August 2022 |  |
Magnolia, Texas, USA |  | November 2019 to April 2021 |  | May 2021 to October 2021
Bethesda, Maryland, USA |  | August 2015 to December 2020 |  | January 2021 to March 2024
The Company adopted ASU No. 2016-02, Leases (Topic 842) (“ASU 2016-02”) to recognize a right-of-use asset and a lease liability for all the leases with terms greater than twelve months. We elected the practical expedient to not recognize operating lease right-of-use assets and operating lease liabilities for lease agreements with terms less than 12 months. Operating lease right-of-use assets and operating lease liabilities are recognized based on the present value of the future minimum lease payments over the lease term at commencement date. As our leases do not provide a readily determinable implicit rates, we estimate our incremental borrowing rates to discount the lease payments based on information available at lease commencement. Our incremental borrowings rates are 3.9% in 2021 and at a range from 0.5% to 4.5% per annum in 2020, which were used as the discount rates. The balances of operating lease right-of-use assets and operating lease liabilities as of March 31, 2021 were $722,507 and $736,561, respectively. The balances of operating lease right-of-use assets and operating lease liabilities as of December 31, 2020 were $574,754 and $574,754, respectively. The table below summarizes future payments due under these leases as of March 31, 2021. For the Years Ended December 31:
2021 |  | $ | 341,827 |
2022 |  |  | 292,830 |
2023 |  |  | 95,104 |
2024 |  |  | 24,430 |
Total Minimum Lease Payments |  |  | 754,191 |
Less: Effect of Discounting |  |  | (17,630 | )
Present Value of Future Minimum Lease Payments |  |  | 736,561 |
Less: Current Obligations under Leases |  |  | (51,686 | )
Long-term Lease Obligations |  |  | 684,875 |

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