XML 42 R19.htm IDEA: XBRL DOCUMENT
v2.4.0.8

Mortgage Notes Payable (Tables) | 9 Months Ended
--- | ---
Sep. 30, 2014
Mortgage Notes Payable [Abstract] |
Mortgage Notes Payable | Mortgage notes payable as of September 30, 2014 and December 31, 2013 consisted of the following:
Property Securing Mortgage Note | Location |  | Monthly Payment |  |  | Interest Rate |  | Maturity Date |  | September 30, 2014 |  |  | December 31, 2013 |
Havana/Parker Complex (1) | Aurora, Colorado |  | $ | 24,330 |  |  |  | 6.51 | % | July 1, 2016 |  | $ | 3,098,780 |  |  | $ | 3,098,780 |
Garden Gateway Plaza | Colorado Springs, Colorado |  |  | 42,383 |  |  |  | 5.00 | % | February 5, 2020 |  |  | 7,003,156 |  |  |  | 7,119,544 |
Waterman Plaza | San Bernardino, California |  |  | 25,995 |  |  |  | 6.50 | % | September 1, 2015 |  |  | 3,391,155 |  |  |  | 3,457,973 |
Sparky's Palms Self-Storage | Thousand Palms, California |  |  | 28,865 |  |  | Variable rate ranging from 5.5% to 10.5%, currently 5.5% |  | March 1, 2034 |  |  | 4,127,864 |  |  |  | 4,215,349 |
Sparky's Hesperia East Self-Storage | Hesperia, California |  |  | 5,171 |  |  | Variable rate, currently 4.75% |  | December 18, 2022 |  |  | 835,950 |  |  |  | 890,774 |
Sparky's Rialto Self-Storage | Rialto, California |  |  | 19,323 |  |  |  | 4.75 | % | May 15, 2023 |  |  | 2,130,979 |  |  |  | 2,166,791 |
Genesis Plaza | San Diego, California |  |  | 28,219 |  |  |  | 4.65 | % | September 1, 2015 |  |  | 4,523,780 |  |  |  | 4,618,147 |
Executive Office Park | Colorado Springs, Colorado |  |  | 26,962 |  |  |  | 5.79 | % | July 1, 2025 |  |  | 4,396,657 |  |  |  | 4,447,699 |
Dakota Center | Fargo, North Dakota |  |  | 36,031 |  |  |  | 4.74 | % | May 31, 2016 |  |  | 11,033,087 |  |  |  | 5,417,950 |
Yucca Valley Retail Center | Yucca Valley, California |  |  | 23,919 |  |  |  | 5.62 | % | April 11, 2015 |  |  | 3,011,523 |  |  |  | 3,095,974 |
Rangewood Medical Office Building | Colorado Springs, Colorado |  |  | 9,858 |  |  |  | 4.95 | % | January 1, 2019 |  |  | 1,108,586 |  |  |  | 1,155,305 |
Regatta Square | Denver, Colorado |  |  | 7,562 |  |  |  | 4.95 | % | January 1, 2019 |  |  | 1,222,266 |  |  |  | 1,244,615 |
Port of San Diego Complex | San Diego, California |  |  | 61,573 |  |  |  | 4.75 | % | March 5, 2020 |  |  | 10,429,338 |  |  |  | 10,608,385 |
Morena Office Center | San Diego, California |  |  | 13,896 |  |  |  | 4.50 | % | June 1, 2021 |  |  | 2,366,704 |  |  |  | 2,411,282 |
Pacific Oaks Plaza | Escondido, California |  |  | 9,450 |  |  |  | 4.50 | % | June 1, 2021 |  |  | 1,609,338 |  |  |  | 1,639,658 |
Shoreline Medical Office Building | Half Moon Bay, California |  |  | 26,043 |  |  |  | 5.10 | % | June 1, 2022 |  |  | 3,875,133 |  |  |  | 3,959,914 |
Sparky's Palm, Joshua and Sunrise Self-Storage | Highland, Hesperia and Thousand Palms, California, respectively |  |  | 42,788 |  |  |  | 4.70 | % | December 6, 2022 |  |  | 8,018,686 |  |  |  | 8,116,028 |
The Presidio | Colorado Springs, Colorado |  |  | 36,701 |  |  |  | 5.60 | % | January 6, 2015 |  |  | 5,393,008 |  |  |  | 5,492,375 |
Sparky's Lancaster Self-Storage | Lancaster, California |  |  | 13,200 |  |  |  | 5.00 | % | June 1, 2020 |  |  | 1,919,652 |  |  |  | 1,965,504 |
Fontana Medical Plaza | Fontana, California |  |  | 11,479 |  |  |  | 4.75 | % | August 28, 2019 |  |  | 1,954,607 |  |  |  | 1,990,880 |
Bismarck Office Building | Bismarck, North Dakota |  |  | 42,735 |  |  |  | 6.12 | % | October 1, 2016 |  |  | 3,337,405 |  |  |  | - |
Union Terrace | Lakewood, Colorado |  |  | 33,441 |  |  |  | 4.50 | % | August 5, 2024 |  |  | 6,600,000 |  |  |  | - |
Subtotal, NetREIT, Inc. properties |  |  |  |  |  |  |  |  |  |  |  |  | 91,387,654 |  |  |  | 77,112,927 |
2 Model Homes (2) | CA |  |  | 5,062 |  |  |  | 5.50 | % | February 10, 2014 |  |  | 329,840 |  |  |  | 1,222,266 |
3 Model Homes | TX |  |  | 2,799 |  |  |  | 5.75 | % | December 15, 2015 |  |  | 278,314 |  |  |  | 778,823 |
7 Model Homes | TX, NC |  |  | 6,016 |  |  |  | 5.75 | % | December 15, 2015 |  |  | - |  |  |  | 639,007 |
6 Model Homes | TX, NC |  |  | 5,012 |  |  |  | 5.87 | % | April 15, 2017 to June 15, 2017 |  |  | 508,917 |  |  |  | 3,212,444 |
8 Model Homes | AZ, CA, NJ |  |  | 13,758 |  |  |  | 5.48 | % | December 15, 2017 |  |  | 1,505,683 |  |  |  | 1,777,808 |
10 Model Homes | PA, TX |  |  | 14,561 |  |  |  | 5.08 | % | December 15, 2017 |  |  | 1,411,063 |  |  |  | 1,343,658 |
7 Model Homes | TX |  |  | 8,047 |  |  |  | 5.00 | % | January 15, 2018 to December 15, 2018 |  |  | 934,187 |  |  |  | 593,505 |
7 Model Homes | TX |  |  | 9,204 |  |  | 5.50% to 5.84% |  | June 30, 2014 to January 15, 2018 |  |  | 671,238 |  |  |  | 2,871,286 |
8 Model Homes | AZ, CA, NJ, TX |  |  | 13,181 |  |  | 5.07% to 5.13% |  | December 15, 2017 to July 15, 2018 |  |  | 1,375,537 |  |  |  | - |
2 Model Homes | PA , TX |  |  | 2,048 |  |  |  | 5.50 | % | February 13, 2019 |  |  | 277,096 |  |  |  | - |
2 Model Homes | PA |  |  | 2,445 |  |  |  | 5.13 | % | August 15, 2019 |  |  | 722,928 |  |  |  | - |
Subtotal, Model Home properties |  |  |  |  |  |  |  |  |  |  |  |  | 8,014,803 |  |  |  | 12,438,797 |
|  |  |  |  |  |  |  |  |  |  |  | $ | 99,402,457 |  |  | $ | 89,551,724 |
1. | In the quarter ended September 30, 2014, the Company determined that an additional impairment existed on its Havana Parker property and recorded an asset impairment of $950,000. At September 30, 2014, the book value of the property was $2.3 million and the property was encumbered with a CMBS loan with a balance of $3.1 million and a maturity date of July 1, 2016. The Company commenced paying the net cash flow from the property in order to get the loan assigned to the proper Servicing Agent qualified to negotiate a modification of the loan. The net cash flow is substantially less than the monthly payment due. The Company has made reduced mortgage payments for the previous eleven (11) mortgage payments. In May 2013, months before the decision to pay only the net cash flow generated by the Property, the Company engaged a third party consultant with experience in modification of CMBS loans to have the terms of the loan modified by the lender on the property. Negotiations with the lender are currently ongoing. However, on March 4, 2014, the Company received a notice of foreclosure from the lender stating that the covenants of the deed of trust have been violated for failure to pay principal and interest when due together with all other payments provided for in the evidence of debt secured by the deed of trust and other violations. The date of any foreclosure sale has been extended while negotiations are underway. We expect that the debt balance will be reduced, the interest rate will be reduced significantly and an option to extend the maturity date of the loan for an addition year. We also expect we will be required to bring the unpaid accrued interest payments current. We have evaluated the potential loss contingency in accordance with generally accepted accounting principles and concluded that it is not likely at this time that the Company will experience further losses. However, if the negotiations are not successful, the Lender may move forward with the court action and foreclose on the property. The loan on the Havana Parker property is non-recourse. Except as noted above, the Company is in compliance with all conditions and covenants of its mortgage notes payable. The Company has evaluated the potential loss contingency in accordance with generally accepted accounting principles and concluded that it is not likely at this time that the Company will experience further losses. However, if the negotiations are not successful, the Lender may move forward with the court action and foreclose on the property. The loan on the Havana Parker property is non-recourse. Except as noted above, the Company is in compliance with all conditions and covenants of its mortgage notes payable.
2. | The Company is working with the lender to extend the maturity date of this loan. The Company anticipates that the lender will extend the due date of these loans until such time as the model home securing the loan is sold.
Scheduled Principal Payments of Mortgage Notes Payable | Scheduled principal payments of mortgage notes payable as of September 30, 2014 are as follows:
Years Ending: |  | NetREIT, Inc. Principal Payments |  |  | Model Home Properties Principal Payments |  |  | Scheduled Principal Payments |
Three months remaining in 2014 |  | $ | 581,439 |  |  | $ | 116,919 |  |  | $ | 698,358 |
2015 |  |  | 17,790,064 |  |  |  | 598,224 |  |  |  | 18,388,288 |
2016 |  |  | 7,641,113 |  |  |  | 1,092,316 |  |  |  | 8,733,429 |
2017 |  |  | 1,554,170 |  |  |  | 1,682,409 |  |  |  | 3,236,579 |
2018 |  |  | 5,670,276 |  |  |  | 2,395,120 |  |  |  | 8,065,396 |
Thereafter |  |  | 58,150,592 |  |  |  | 2,129,815 |  |  |  | 60,280,407 |
Total |  | $ | 91,387,654 |  |  | $ | 8,014,803 |  |  | $ | 99,402,457 |

X
- Definition Tabular disclosure of the aggregate amount of payments due on known contractual obligations for the five years following the date of the latest balance sheet and the combined aggregate amount of maturities of known contractual obligations. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -SubTopic 10 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6802200&loc=d3e1835-112601 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-K (SK) -Number 229 -Section 303 -Paragraph a -Subparagraph 5 + Details
Name: | us-gaap_ContractualObligationFiscalYearMaturityScheduleTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- Details
Name: | us-gaap_MortgageLoansOnRealEstateAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition Tabular disclosure of information pertaining to short-term and long-debt instruments or arrangements, including but not limited to identification of terms, features, collateral requirements and other information necessary to a fair presentation. + References No definition available. + Details
Name: | us-gaap_ScheduleOfDebtTableTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration