XML 32 R15.htm IDEA: XBRL DOCUMENT
v3.24.1

DEBT | 12 Months Ended
--- | ---
Dec. 31, 2023
Debt Disclosure [Abstract] |
DEBT | 7. DEBT The following table summarizes the debt balances as of December 31, 2023 and 2022, and the debt activity for the year ended December 31, 2023 (in thousands):
|  |  |  | During the Year Ended December 31, 2023 |  |
|  | Balances as of December 31, 2022 |  | Debt Issuances & Assumptions |  | Repayments |  | Accretion & (Amortization) |  | Balances as of December 31, 2023
Mortgages Payable: |  |  |  |  |  |  |  |  |  |
Fixed rate mortgages payable |  | $ | 97,100 |  |  | $ | 66,600 |  |  | $ | — |  |  | $ | — |  |  | $ | 163,700 |
Variable rate mortgage payable |  | — |  |  | 182,600 |  |  | (95,600) |  |  | — |  |  | 87,000 |
|  | 97,100 |  |  | 249,200 |  |  | (95,600) |  |  | — |  |  | 250,700 |
Deferred debt issuance costs — Mortgages Payable |  | (94) |  |  | (1,899) |  |  | — |  |  | 1,039 |  |  | (954) |
Total Mortgages Payable |  | 97,006 |  |  | 247,301 |  |  | (95,600) |  |  | 1,039 |  |  | 249,746 |
Secured Borrowings – Government Guaranteed Loans: |  |  |  |  |  |  |  |  |  |
Outstanding Balance |  | 5,979 |  |  | — |  |  | (2,972) |  |  | — |  |  | 3,007 |
Unamortized premiums |  | 258 |  |  | — |  |  | — |  |  | (158) |  |  | 100 |
Total Secured Borrowings—Government Guaranteed Loans |  | 6,237 |  |  | — |  |  | (2,972) |  |  | (158) |  |  | 3,107 |
Other Debt: |  |  |  |  |  |  |  |  |  |
2022 credit facility revolver |  | — |  |  | 267,000 |  |  | (170,000) |  |  | — |  |  | 97,000 |
2022 credit facility term loan |  | 56,230 |  |  | — |  |  | — |  |  | — |  |  | 56,230 |
Junior subordinated notes |  | 27,070 |  |  | — |  |  | — |  |  | — |  |  | 27,070 |
SBA 7(a) loan-backed notes |  | — |  |  | 54,141 |  |  | (12,747) |  |  | — |  |  | 41,394 |
Deferred debt issuance costs — other |  | (779) |  |  | (1,312) |  |  | — |  |  | 503 |  |  | (1,588) |
Discount on junior subordinated notes |  | (1,497) |  |  | — |  |  | — |  |  | 99 |  |  | (1,398) |
Total Other Debt |  | 81,024 |  |  | 319,829 |  |  | (182,747) |  |  | 602 |  |  | 218,708 |
Total Debt, Net |  | $ | 184,267 |  |  | $ | 567,130 |  |  | $ | (281,319) |  |  | $ | 1,483 |  |  | $ | 471,561 |
Fixed Rate Mortgages Payable—The Company’s fixed rate mortgages payable are secured by a deed of trust on the properties underlying such mortgages and assignments of rents receivable. As of December 31, 2023, the Company’s fixed rate mortgages payable had fixed interest rates of 4.14% and 6.25% per annum, with payments of interest only, due on July 1, 2026 and June 7, 2024, respectively. In regards to the mortgage payable maturing on June 7, 2024, there is a one-year extension option available which the Company expects to execute prior to maturity. These loans are nonrecourse. On December 21, 2023, the Company made a prepayment of $13.0 million on one of its variable rate mortgages and refinanced the remaining $66.6 million, changing the rate from a variable interest rate to a fixed rate of 6.25% per annum (the “1150 Clay Refinance”). Variable Rate Mortgage Payable—The Company’s variable rate mortgage payable is secured by a deed of trust on the property and assignment of rents receivable. As of December 31, 2023, the Company’s variable rate mortgage payable had a variable interest rate of SOFR plus 3.36%, with monthly payments of interest only due on July 7, 2025 with an extension option subject to certain conditions being met. The loan is nonrecourse. The $95.6 million of variable rate mortgage repayments in the table above includes the impact of the 1150 Clay Refinance. Secured Borrowings—Government Guaranteed Loans—Secured borrowings—government guaranteed loans represent sold loans which are treated as secured borrowings because the loan sales did not meet the derecognition criteria provided for in ASC 860-30, Secured Borrowing and Collateral. These loans included cash premiums that are amortized as a reduction to interest expense over the life of the loan using the effective interest method and are fully amortized when the underlying loan is repaid in full. As of December 31, 2023, the Company’s secured borrowings-government guaranteed loans included $1.4 million of loans sold for a premium and excess spread, with a variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 9.28% at December 31, 2023, and $1.6 million of loans sold for an excess spread, with a variable rate, reset quarterly, based on prime rate with weighted average coupon rate of 6.88% at December 31, 2023. 2022 Credit Facility—In December 2022 the Company refinanced its 2018 credit facility and replaced it with a new 2022 credit facility, entered into with a bank syndicate, that includes a $56.2 million term loan (the “2022 Credit Facility Term Loan”) as well as a revolver allowing the Company to borrow up to $150.0 million (the “2022 Credit Facility Revolver”), both of which are collectively subject to a borrowing base calculation. The 2022 credit facility is secured by certain properties in the Company’s real estate portfolio: six office properties and one hotel property (as well as the hotel’s adjacent parking garage and retail property). The 2022 credit facility bears interest at (A) the base rate plus 1.50% or (B) SOFR plus 2.60%. As of December 31, 2023, the variable interest rate was 7.96%. The 2022 Credit Facility Revolver is also subject to an unused commitment fee of 0.15% or 0.25% depending on the amount of aggregate unused commitments. The 2022 credit facility is guaranteed by the Company and the Company is subject to certain financial maintenance covenants. The 2022 credit facility matures in December 2025 and provides for two one-year extension options under certain conditions, including providing notice of the election and paying an extension fee of 0.15% of each lender’s commitment being extended on the effective date of such extension. As of December 31, 2023 and 2022, $53.0 million and $150.0 million, respectively, was available for future borrowings. Junior Subordinated Notes—The Company has junior subordinated notes with a variable interest rate which resets quarterly based on the three-month SOFR plus 3.51%, with quarterly interest only payments. The junior subordinated balance is due at maturity on March 30, 2035. The junior subordinated notes may be redeemed at par at the Company’s option. SBA 7(a) Loan-Backed Notes—On March 9, 2023, the Company completed a securitization of the unguaranteed portion of certain of its SBA 7(a) loans receivable with the issuance of $54.1 million of unguaranteed SBA 7(a) loan-backed notes (with net proceeds of approximately $43.3 million, after payment of fees and expenses in connection with the securitization and the funding of a reserve account and an escrow account). The SBA 7(a) loan-backed notes are collateralized by the right to receive payments and other recoveries attributable to the unguaranteed portions of certain of our SBA 7(a) loans receivable. The SBA 7(a) loan-backed notes mature on March 20, 2048, with monthly payments due as payments on the collateralized loans are received. The SBA 7(a) loan-backed notes bear interest at a per annum rate equal to the lesser of (i) the 30-day average compounded SOFR plus 2.90% and (ii) the prime rate minus 0.35%. As of December 31, 2023, the variable interest rate was 8.15%. The Company reflects the SBA 7(a) loans receivable as assets on its consolidated balance sheet and the SBA 7(a) loan-backed notes as debt on its consolidated balance sheet. The restricted cash on the Company’s consolidated balance sheets included funds related to the Company’s SBA 7(a) loan-backed notes was $5.7 million as of December 31, 2023. Deferred debt issuance costs, which represent legal and third-party fees incurred in connection with the Company’s borrowing activities, are capitalized and amortized to interest expense on a straight-line basis over the life of the related loan, approximating the effective interest method. Deferred debt issuance costs are presented net of accumulated amortization and are a reduction to total debt. As of December 31, 2023 and 2022, accrued interest and unused commitment fees payable of $1.8 million and $562,000, respectively, are included in accounts payable and accrued expenses. Future principal payments on the Company’s debt (face value) as of December 31, 2023 are as follows:
Years Ending December 31, |  | Mortgages Payable |  | Secured Borrowings Principal (1) |  | 2022 Credit Facility |  | Other (1) (2) |  | Total
|  | (in thousands)
2024 |  | $ | 66,600 |  |  | $ | 173 |  |  | $ | — |  |  | $ | 12,039 |  |  | $ | 78,812 |
2025 |  | 87,000 |  |  | 188 |  |  | 153,230 |  |  | 9,947 |  |  | 250,365 |
2026 |  | 97,100 |  |  | 204 |  |  | — |  |  | 8,504 |  |  | 105,808 |
2027 |  | — |  |  | 220 |  |  | — |  |  | 10,904 |  |  | 11,124 |
2028 |  | — |  |  | 238 |  |  | — |  |  | — |  |  | 238 |
Thereafter |  | — |  |  | 1,984 |  |  | — |  |  | 27,070 |  |  | 29,054 |
|  | $ | 250,700 |  |  | $ | 3,007 |  |  | $ | 153,230 |  |  | $ | 68,464 |  |  | $ | 475,401 |
(1)Principal payments on secured borrowings and SBA 7(a) loan-backed notes, which are included in Other, are generally dependent upon cash flows received from the underlying loans. The Company’s estimate of their repayment is based on scheduled payments on the underlying loans. The Company’s estimate will differ from actual amounts to the extent the Company experiences prepayments and/or loan liquidations or charge-offs. (2)Represents the junior subordinated notes and SBA 7(a) loan-backed notes.

X
- References No definition available. + Details
Name: | us-gaap_DebtDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 470 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//470/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1E -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I + Details
Name: | us-gaap_DebtDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration