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Real Estate Assets
9 Months Ended12 Months Ended
Sep. 30, 2011
Dec. 31, 2010
Real Estate and Accumulated Depreciation Disclosure [Abstract]  
Real Estate and Accumulated Depreciation Disclosure [Text Block]
3. REAL ESTATE ASSETS AND LEASE INTANGIBLES
             
A summary of the twenty properties and seventy-nine model home properties
 owned by the Company as of September 30, 2011 is as follows:
             
           Real estate
   Date    Square Property assets, net
 Property Name Acquired Location  Footage Description (in thousands)
 Casa Grande Apartments  April 1999 Cheyenne, Wyoming 29,250 Residential $ 1,446.4
 Havana/Parker Complex  June 2006 Aurora, Colorado 114,000 Office   5,371.0
 7-Eleven  September 2006 Escondido, California 3,000 Retail   1,287.8
 Garden Gateway Plaza  March 2007 Colorado Springs, Colorado 115,052 Office   13,085.2
 World Plaza  September 2007 San Bernardino, California 55,098 Retail   5,613.2
 Regatta Square  October 2007 Denver, Colorado 5,983 Retail   1,984.1
 Sparky’s Palm Self-Storage  November 2007 Highland, California 50,250 Self Storage   4,627.2
 Sparky’s Joshua Self-Storage  December 2007 Hesperia, California 149,750 Self Storage   7,193.1
 Executive Office Park  July 2008 Colorado Springs, Colorado 65,084 Office   8,719.3
 Waterman Plaza  August 2008 San Bernardino, California 21,170 Retail   6,512.4
 Pacific Oaks Plaza  September 2008 Escondido, California 16,000 Office   4,557.4
 Morena Office Center  January 2009 San Diego, California 26,784 Office   5,933.1
 Fontana Medical Plaza  February 2009 Fontana, California 10,500 Office   2,116.7
 Rangewood Medical Office Building  March 2009 Colorado Springs, Colorado 18,222 Office   2,385.7
 Sparky’s Thousand Palms Self-Storage  August 2009 Thousand Palms, California 113,126 Self Storage   5,868.3
 Sparky’s Hesperia East Self-Storage  December 2009 Hesperia, California 72,940 Self Storage   2,727.5
 Sparky’s Rialto Self-Storage  May 2010 Rialto, California 101,343 Self Storage   5,170.4
 Genesis Plaza  August 2010 San Diego, California 57,685 Office   8,983.8
 Dakota Bank Buildings May 2011 Fargo, North Dakota 119,749 Office   8,886.0
 Yucca Valley Retail Center September 2011 Yucca Valley, California 85,996 Retail   6,515.0
  NetREIT, Inc properties           108,983.6
             
 14 model home properties  Various in          
   2009 CA and NV 34,320 Residential   5,647.6
             
 48 model home properties  Various in          
   2010 & 2011 CA, AZ, OR, WA, TX, SC,       
     NC, ID and FL 199,947 Residential   11,024.8
             
 17 model home properties,            
  held in income funds Various TX, WA, OH, NC,       
   2003-2008 NV, CA, NJ and MI 37,389 Residential   4,558.2
             
  Model home properties           21,230.6
             
     Total real estate assets, net     $ 130,214.2

  The following table sets forth the components of the Company’s real estate assets:
        
    September 30,  December 31,
    2011  2010
  Land $ 26,179,319 $ 22,413,950
  Buildings and other   109,281,490   98,639,739
  Tenant improvements   5,285,963   4,147,535
     140,746,772   125,201,224
  Less:     
  Accumulated depreciation and amortization   (10,532,570)   (8,075,805)
  Real estate assets, net $ 130,214,202 $ 117,125,419

Operations from each property are included in the Company's condensed consolidated financial statements from the date of acquisition.

 

The Company acquired the following properties in 2011:

 

In January 2011, NetREIT Dubose acquired two model home properties in Texas and leased them back to the home builder. The purchase price for the properties was $0.45 million. NetREIT Dubose paid the purchase price through a cash payment of $0.23 million and two promissory notes totaling $0.22 million.

 

In February 2011, NetREIT Dubose acquired five model home properties in California and leased them back to the home builder. The purchase price for the properties was $1.5 million. NetREIT Dubose paid the purchase price through a cash payment of $0.75 million and five promissory notes totaling $0.75 million.

 

In March 2011, NetREIT Dubose acquired four model home properties in South Carolina, Florida and Texas and leased them back to the home builder. The purchase price for the properties was $1.0 million. NetREIT Dubose paid the purchase price through a cash payment of $0.50 million and four promissory notes totaling $0.50 million.

 

In May 2011, the Company acquired vacant land consisting of approximately 3 acres adjacent to its Sparky's Rialto Self-Storage facility for approximately $0.4 million paid in cash. The Company intends to use the land for additional motor home parking or for other purposes.

 

In May 2011, the Company acquired the Dakota Bank Buildings for the purchase price of approximately $9.6 million. The Property is a six-story, two building office complex built in 1981 and 1986 located on 1.58 acres and consists of approximately120,000 rentable square feet in downtown Fargo, North Dakota. The Company made a down payment of approximately $3.875 million and financed the remainder of the purchase price through a monthly adjustable rate mortgage with interest at 3.0% over the one month Libor with an interest rate floor of 5.75% and ceiling of 9.75%.

 

In June 2011, NetREIT Dubose acquired three model home properties in Texas and leased them back to the home builder. The purchase price for the properties was approximately $0.60 million. NetREIT Dubose paid the purchase price through a cash payment of approximately $0.30 million and three promissory notes totaling approximately $0.30 million.

 

In August 2011, NetREIT Dubose acquired eight model home properties in Texas, Florida, North Carolina and South Carolina and leased them back to the home builder. The purchase price for the properties was approximately $1.9 million. NetREIT Dubose paid the purchase price through a cash payment of approximately $1.0 million and eight promissory notes totaling approximately $0.90 million.

 

In September 2011, the Company acquired the Yucca Valley Retail Center for the purchase price of approximately $6.8 million. The Property is a neighborhood shopping center complex built in approximately 1978 consisting of five separate parcels. The Property consists of approximately 86,000 rentable square feet and is currently 93% leased and anchored by a national chain grocery store. The Company paid the purchase price through a cash payment of approximately $3.5 million and assumed a loan secured by the property of approximately $3.3 million with an interest rate of 5.62%.

 

The Company disposed of the following properties in 2011:

 

During the nine months ended September 30, 2011, NetREIT Dubose disposed of eighteen model home properties. The sales price aggregated approximately $6.6 million and approximately $4.4 million in mortgage notes payable were retired in connection with these sales.

The Company allocated the purchase price of the properties acquired during the nine months
  ended September 30, 2011 as follows:              
              Above BelowTotal
     Buildings Tenant In-place Market Market  Purchase
  Land  and other  Improvements  Leases  Leases Leases Price
Model Home                    
 Properties$ 925,120 $ 4,721,260 $ - $ - $ - $  $ 5,646,380
                      
Sparky's Rialto                    
 Self-Storage  415,000   -   -   -   -      415,000
                      
Dakota Bank                    
 Building  832,000   8,123,461   131,982   45,186   442,371      9,575,000
                      
Yucca Valley                    
 Retail Center  2,445,331   3,549,162   520,485   819,979   274,168   (841,425)   6,767,700
                      
                      
                      
                      
                      
The Company allocation of properties sold during the nine months ended September 30, 2011 is as follows:
                      
     Buildings Accumulated  Net Book          
  Land  and other  Depreciation  Value         
Model Home                    
 Properties$ 852,083 $ 5,960,113 $ 188,345 $ 6,623,851         
                      
                      
                      
                      
                      
The Company allocated the purchase price of the properties acquired during
 the twelve months ended December 31, 2010 as follows:      
                      
                 Above Total
      Buildings Tenant In-place Leasing  Market  Purchase
  Land   and other  Improvements  Leases  Costs Leases Price
Sparky's Rialto                    
 Self-Storage$ 1,055,000 $ 3,820,000 $ - $ - $ - $ - $ 4,875,000
                      
Genesis Plaza  1,400,000   7,543,510   200,954   219,070   247,774   388,692   10,000,000
                      
Model Home                    
 Properties  1,043,097   4,630,953   -   -   -   -   5,674,050

Lease Intangibles
                   
The following table summarizes the net value of other intangible assets and the accumulated amortization for each
class of intangible asset:
   September 30, 2011  December 31, 2010
         Lease        Lease
   Lease  Accumulated  intangibles,  Lease  Accumulated  intangibles,
   intangibles   amortization   net   intangibles   amortization   net
In-place leases $ 1,875,589 $ (728,116) $ 1,147,473 $ 1,031,792 $ (558,854) $ 472,938
Leasing costs   1,047,837   (547,135)   500,702   894,487   (423,738)   470,749
Tenant                 
 relationships 332,721   (332,721)   -   332,721   (332,721)   -
Below-market                 
 leases (841,425)   -   (841,425)   -   -   -
Above-market                 
 leases 1,105,231   (238,173)   867,058   388,692   (42,772)   345,920
                   
  $ 3,519,953 $ (1,846,145) $ 1,673,808 $ 2,647,692 $ (1,358,085) $ 1,289,607

As of September 30, 2011, the estimated aggregate amortization expense for the three months ended
December 31,2011 and each of the five succeeding fiscal years and thereafter is as follows:
   Estimated
   Aggregate
   Amortization
   Expense
Three month period ending December 31, 2011 $ 283,085
2012   931,899
2013   431,619
2014   336,659
2015   240,582
Thereafter    (550,036)
  $ 1,673,808
    
The weighted average amortization period for the intangible assets, in-place leases, leasing costs, tenant
relationships above and below-market leases acquired as of September 30, 2011 was 23.2 years.
A summary of the eighteen properties and seventy four model home properties
 owned by the Company as of December 31, 2010 is as follows:
             
           Real estate
   Date    Square Property assets, net
 Property Name Acquired Location  Footage Description (in thousands)
 Casa Grande Apartments  April 1999 Cheyenne, Wyoming 29,250 Residential $ 1,500.0
 Havana/Parker Complex  June 2006 Aurora, Colorado 114,000 Office   5,469.8
 7-Eleven  September 2006 Escondido, California 3,000 Retail   1,304.0
 Garden Gateway Plaza  March 2007 Colorado Springs, Colorado 115,052 Office   13,088.5
 World Plaza  September 2007 San Bernardino, California 55,098 Retail   5,716.8
 Regatta Square  October 2007 Denver, Colorado 5,983 Retail   1,989.2
 Sparky’s Palm Self-Storage  November 2007 Highland, California 50,250 Self Storage   4,712.2
 Sparky’s Joshua Self-Storage  December 2007 Hesperia, California 149,750 Self Storage   7,322.7
 Executive Office Park  July 2008 Colorado Springs, Colorado 65,084 Office   8,849.0
 Waterman Plaza  August 2008 San Bernardino, California 21,170 Retail   6,592.5
 Pacific Oaks Plaza  September 2008 Escondido, California 16,000 Office   4,623.5
 Morena Office Center  January 2009 San Diego, California 26,784 Office   6,069.7
 Fontana Medical Plaza  February 2009 Fontana, California 10,500 Office   2,170.6
 Rangewood Medical Office Building  March 2009 Colorado Springs, Colorado 18,222 Office   2,451.9
 Sparky’s Thousand Palms Self-Storage  August 2009 Thousand Palms, California 113,126 Self Storage   5,976.1
 Sparky’s Hesperia East Self-Storage  December 2009 Hesperia, California 72,940 Self Storage   2,755.6
 Sparky’s Rialto Self-Storage  May 2010 Rialto, California 101,343 Self Storage   4,830.3
 Genesis Plaza  August 2010 San Diego, California 57,685 Office   9,053.6
  NetREIT, Inc properties           94,476.0
             
 19 model home properties  Various in          
   2009 CA and NV 47,637 Residential   7,483.8
             
 26 model home properties  Various in          
   2010 CA, AZ, OR, WA and TX 62,349 Residential   5,654.9
             
 29 model home properties,            
  held in income funds Various TX, AZ, WA, OH, NC,       
   2003-2008 NV, NJ and MI 69,907 Residential   9,510.7
             
  Model home properties           22,649.4
             
     Total real estate assets, net     $ 117,125.4