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Redeemable Non-Controlling Interests | 9 Months Ended
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Sep. 30, 2021
Noncontrolling Interest [Abstract] |
Redeemable Non-Controlling Interests | Note 6 – Redeemable Non-Controlling Interests The following table reflects our Redeemable Non-Controlling Interests:
|  |  | Brown Family Trust |  | Irby Prop Partners |  | Hornstrom |  | GIP Fund I |  | Greenwal L.C. |  | Riverside Crossing L.C. |  | Total
Balance, December 31, 2019 |  |  | $1,200,000 |  | $- |  | $- |  | $- |  | $4,965,000 |  | $2,033,251 |  | $8,198,251
Distribution on Redeemable Non-Controlling Interest |  |  | (20,375) |  | - |  | - |  | - |  | (86,887) |  | (35,582) |  | (142,844)
Net income for the quarter |  |  | 20,375 |  | - |  | - |  | - |  | 86,887 |  | 35,582 |  | 142,844
Balance, March 31, 2020 |  |  | $1,200,000 |  | $- |  | $- |  | $- |  | $4,965,000 |  | $2,033,251 |  | $8,198,251
Distribution on Redeemable Non-Controlling Interest |  |  | (39,851) |  | - |  | - |  | - |  | - |  | - |  | (39,851)
Net income for the quarter |  |  | 39,851 |  | - |  | - |  | - |  | - |  | - |  | 39,851
Balance, June 30, 2020 |  |  | $1,200,000 |  | $- |  | $- |  | $- |  | $4,965,000 |  | $2,033,251 |  | $8,198,251
Distribution on Redeemable Non-Controlling Interest |  |  | (29,553) |  | - |  | - |  | - |  | (86,888) |  | (35,582) |  | (152,023)
Net income for the quarter |  |  | 29,553 |  | - |  | - |  | - |  | 86,888 |  | 35,582 |  | 152,023
Balance, September 30, 2020 |  |  | $1,200,000 |  | $- |  | $- |  | $- |  | $4,965,000 |  | $2,033,251 |  | $8,198,251
Balance, December 31, 2020 |  |  | $1,200,000 |  | $- |  | $- |  | $486,180 |  | $4,965,000 |  | $2,033,251 |  | $8,684,431
Issuance of Redeemable Non-Controlling Interest for property acquisition |  |  | 500,000 |  | - |  | - |  | - |  | - |  | - |  | 500,000
Distribution on Redeemable Non-Controlling Interest |  |  | (37,104) |  | - |  | - |  | - |  | (33,041) |  | (80,681) |  | (150,826)
Net income for the quarter |  |  | 37,104 |  | - |  | - |  | - |  | 33,041 |  | 80,681 |  | 150,826
Balance, March 31, 2021 |  |  | $1,700,000 |  | $- |  | $- |  | $486,180 |  | $4,965,000 |  | $2,033,251 |  | $9,184,431
Issuance of Redeemable Non-Controlling Interest for property acquisition |  |  | - |  | 950,000 |  | - |  | - |  | - |  | - |  | 950,000
Distribution on Redeemable Non-Controlling Interest |  |  | (41,125) |  | (15,275) |  | - |  | (2,748) |  | - |  | - |  | (59,148)
Net income for the quarter |  |  | 41,125 |  | 15,275 |  | - |  | 2,748 |  | - |  | - |  | 59,148
Balance, June 30, 2021 |  |  | $1,700,000 |  | $950,000 |  | $- |  | $486,180 |  | $4,965,000 |  | $2,033,251 |  | $10,134,431
Redemption of Redeemable Non-Controlling Interest for property disposal |  |  | (1,200,000) |  | - |  | - |  | - |  | - |  | - |  | (1,200,000)
Issuance of Redeemable Non-Controlling Interest for property acquisition |  |  | - |  | - |  | 650,000 |  | - |  | - |  | - |  | 650,000
Distribution on Redeemable Non-Controlling Interest |  |  | (31,399) |  | (19,081) |  | (6,838) |  | (7,898) |  | (33,040) |  | (80,863) |  | (179,119)
Net income for the quarter |  |  | 31,399 |  | 36,259 |  | 10,257 |  | 7,898 |  | 33,040 |  | 80,863 |  | 199,716
Balance, September 30, 2021 |  |  | $500,000 |  | $967,178 |  | $653,419 |  | $486,180 |  | $4,965,000 |  | $2,033,251 |  | $9,605,028
As part of the Company’s acquisition of a building for $4.5 million in Cocoa, FL, one of the Company’s operating subsidiaries entered into a preferred equity agreement with Brown Family Trust on September 11, 2019 pursuant to which the Company’s subsidiary received a capital contribution of $1,200,000. Pursuant to the agreement, the Company was required to pay the preferred equity member a 10% IRR on a monthly basis and redeem the entire amount due after 24 months at the option of the preferred equity member. The Operating Partnership, Generation Income Properties, LP, was the general manager of the subsidiary while Brown Family Trust was a preferred member. Because of the redemption right, the non-controlling interest was presented as temporary equity at redemption value. The Company redeemed the Brown Family Trust $1.2 million Redeemable Non-Controlling Interest upon the sale property in August 2021. As part of the Company’s acquisition of a building for $1.7 million in Manteo, NC, one of the Company’s operating subsidiaries entered into a preferred equity agreement with Brown Family Trust on February 11, 2021 pursuant to which the Company’s subsidiary received a capital contribution of $500,000. Pursuant to the agreement, the Company will pay the preferred equity member a 9% IRR on a monthly basis and redeem the entire amount due after 24 months at the option of the preferred equity member. The Operating Partnership, Generation Income Properties, LP, is the general manager of the subsidiary while Brown Family Trust is a preferred member. Because of the redemption right, the non-controlling interest in presented as temporary equity at redemption value. The current redemption amount is $500,000. Distributable operating funds are distributed first to Brown Family Trust until the unpaid preferred return is paid off and then to the Company. Income is allocated 100% to the Company. For the nine-months ended September 30, 2021 and 2020, the Company paid these Redeemable Interests $110 thousand and $90 thousand, respectively in preferred distributions for these two agreements. As part of the Company’s acquisition of a building for $1.7 million in Plant City, FL, one of the Company’s operating subsidiaries entered into a preferred equity agreement with preferred equity partners (Irby Prop Partners) on April 21, 2021 pursuant to which the Company’s subsidiary received a capital contribution of $950,000. Pursuant to the agreement, the Company will pay the preferred equity member a 12% total IRR with an 8% IRR paid on a monthly basis and the deferred IRR will be paid at the end of 24 months along with the entire $950,000 amount due after 24 months at the option of the preferred equity member. The Operating Partnership, Generation Income Properties, LP, is the general manager of the subsidiary. Because of the redemption right, the non-controlling interest in presented as temporary equity at redemption value. The current redemption amount is $967,178. Distributable operating funds are distributed first to the preferred equity partners until the unpaid preferred return is paid off and then to the Company. Income is allocated 100% to the Company. For the nine-months ended September 30, 2021, the Company paid these Redeemable Interests $34 thousand in distributions and accrued $17 thousand of the deferred IRR. As part of the Company’s investment in a tenant in common entity for $0.7 million in Rockville, IL, one of the Company’s operating subsidiaries entered into a preferred equity agreement with preferred equity partner (Mr. Hornstrom) on August 2, 2021 pursuant to which the Company’s subsidiary received a capital contribution of $650,000. Pursuant to the agreement, the Company will pay the preferred equity member a 12% total IRR with an 8% IRR paid on a monthly basis and the deferred IRR will be paid at the end of 24 months along with the entire $650,000 amount due after 24 months at the option of the preferred equity member. The Operating Partnership, Generation Income Properties, LP, is the general manager of the subsidiary. Because of the redemption right, the non-controlling interest in presented as temporary equity at redemption value. The current redemption amount is $653,419. Distributable operating funds are distributed first to the preferred equity partners until the unpaid preferred return is paid off and then to the Company. Income is allocated 100% to the Company. For the nine-months ended September 30, 2021, the Company paid these Redeemable Interests $7 thousand in distributions accrued $3 thousand of the deferred IRR. As part of the Company’s acquisition of two buildings on September 30, 2019 for $18.6 million in Norfolk, VA, the Operating Partnership entered into contribution agreements with two entities (Greenwal, LC and Riverside Crossing, L.C.) that resulted in the issuance of 349,913 common units in Operating Partnership at $20.00 per share for a total value of $6,998,251 or as of September 30, 2021 a 13.8% interest in our Operating Partnership. The contribution agreement allows for the two investors to require the Operating Partnership to redeem, all or a portion of its units for either (i) the Redemption Amount (within the meaning of the Partnership Agreement), or (ii) until forty-nine (49) months from date of Closing, cash in an agreed-upon Value (within the meaning of the Partnership Agreement) of $20.00 per share of common stock of the Company, as set forth on the Notice of Redemption. As such, the Company has determined their equity should be classified as a Redeemable Non-Controlling Interest. As part of the Company’s acquisition of one building on November 30, 2020 for $1.8 million in Tampa, FL, the Operating Partnership entered into a contribution agreement with one entity (GIP Fund I) that resulted in the issuance of 24,309 common units in Operating Partnership at $20.00 per share for a total value of $486,180 or as of September 30, 2021 a 1.0% interest in our Operating Partnership. The contribution agreement allows for the two investors to require the Operating Partnership to redeem, all or a portion of its units for either (i) the Redemption Amount (within the meaning of the Partnership Agreement), or (ii) until forty nine (49) months from date of Closing, cash in an agreed-upon Value (within the meaning of the Partnership Agreement) of $20.00 per share of common stock of the Company, as set forth on the Notice of Redemption. As such, the Company has determined their equity should be classified as a Redeemable Non-Controlling Interest. For the nine-months ended September 30, 2021 and 2020, the Company paid these three Redeemable Interests $238 thousand and $245 thousand, respectively in distributions.

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