Equity and Redeemable Non-controlling Interest |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Jun. 30, 2026 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Noncontrolling Interest [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Equity and Redeemable Non-controlling Interest | Note 10. Equity and Redeemable Non-controlling Interest The Company is authorized to issue an unlimited amount of shares at the current NAV per share value. Share Repurchase Plan The Company has adopted a share repurchase plan whereby, following the third anniversary of the initial closing held on February 1, 2023 (the “Lock-Out Period”), shareholders may request that the Company repurchase all or a portion of their shares on a quarterly basis. At the discretion of the Trustee, the Company has commenced the share repurchase plan effective as of February 1, 2026. Prior to the commencement of the share repurchase plan, exceptions to the Lock-Out Period could be granted in certain limited circumstances in the Trustee’s sole discretion. Shares will be repurchased pursuant to the share repurchase plan as of the last calendar day of each quarter (a “Repurchase Date") at a repurchase price equal to the transaction price applicable to such Repurchase Date (which will generally be equal to the most recently determined NAV per share as of the Repurchase Date); provided, however, that any shares that have been held for less than 12 months will be repurchased at a price equal to 98% of the applicable transaction price (the “Early Repurchase Deduction”). The Company is not obligated to repurchase any shares pursuant to the share repurchase plan and may choose to repurchase only some, or none, of the shares that have been requested to be repurchased in any quarter at the Trustee’s sole discretion. In addition, the aggregate NAV of total repurchases of shares in a quarter will be limited to no more than 5.0% of the Company’s aggregate NAV per calendar quarter (measured using the average aggregate NAV attributable to shareholders as of the end of the immediately preceding three months). The Early Repurchase Deduction will be retained by the Company for the benefit of remaining shareholders. The following table summarizes the share repurchases completed during the six months ended June 30, 2026:
(1) Repurchases are limited under the share repurchase plan as described above. (2) Share repurchases were funded from sources permitted under the Company’s share repurchase plan. (3) Amount shown net of Early Repurchase Deduction. (4) Represents aggregate NAV of the shares repurchased under the Company’s Share Repurchase Plan over aggregate NAV of all shares outstanding, in each case, based on the NAV as of the last calendar day of the prior month. (5) All repurchase requests under the Company’s share repurchase plan were satisfied. Distributions The Company generally intends to distribute substantially all of its taxable income, which does not necessarily equal net income as calculated in accordance with GAAP, to its shareholders each year to comply with the REIT provisions of the IRC. Accrued distributions are included in Distributions Payable on the Company’s Consolidated Balance Sheets. The following tables detail the Company’s distributions for the six months ended June 30, 2026:
The following tables detail the Company’s distributions for the six months ended June 30, 2025:
Distribution Reinvestment Plan The Company has adopted a distribution reinvestment plan (“DRIP”) whereby shareholders shall have the cash distributions otherwise payable to them by the Company automatically reinvested in additional shares unless they elect to receive such distributions in cash. Any cash distributions attributable to the shares owned by participants who elect into the DRIP will be reinvested effective the first of the month following the declaration date in additional shares on behalf of the participants. The per share purchase price for shares purchased pursuant to the DRIP will be equal to the most recently determined NAV per share at the time the distribution is payable. Shares acquired under the DRIP will entitle the participant to the same rights and be treated in the same manner as shares purchased in the Offering. Redeemable Non-controlling Interest in Consolidated Joint Ventures On November 2, 2023, the Company acquired the Trails at Silverdale property through the establishment of a JV. On September 12, 2024, the Company acquired the Sylva on Main property through the establishment of a separate JV. The Company’s JV partners have a right to require the Company to repurchase their interest in the JVs at a defined price any time after a five-year lockout period from the date of purchase. Therefore, the non-controlling partners’ shares of the assets, liabilities and operations of the JVs are included in Redeemable Non-controlling Interest in Consolidated Joint Ventures on the Company’s Consolidated Balance Sheets and reported as mezzanine equity of the Company. The interests of the non-controlling partners are generally calculated as the JV partners’ ownership percentages of the JVs. The arrangements provide the JV partners a profit interest based on agreed upon internal rate of return hurdles being achieved. Any profit interest due to the JV partners is reported within Redeemable Non-controlling Interest in Consolidated Joint Ventures on the Company’s Consolidated Balance Sheets. The Redeemable Non-controlling Interest in Consolidated Joint Ventures is recorded at the greater of the carrying amount (adjusted for the JV’s share of the allocation of income or loss and distributions) or the redemption value (which is based on fair value) of such interest at the end of each measurement period. The redemption value is determined as of the period-end date based on the JV’s NAV. NAV is equivalent to GAAP equity adjusted for unrealized real estate appreciation, accumulated depreciation and amortization, and straight-line rent adjustments. For purposes of determining the Company’s NAV, the fair value of investments in real estate is determined based on a combination of valuations provided by a third party valuation firm and property appraisals performed externally by third party appraisal firms. The redemption values of the JVs were greater than the adjusted carrying values for the six months ended June 30, 2026, as such an adjustment of approximately $0.7 million was recorded to Redeemable Non-controlling Interest in Consolidated Joint Ventures on the Company’s Consolidated Balance Sheet. The redemption values of the JVs were greater than the adjusted carrying values for the year ended December 31, 2025, as such an adjustment of approximately $1.8 million was recorded to Redeemable Non-controlling Interest in Consolidated Joint Ventures on the Company’s Consolidated Balance Sheet. The following table details the changes in Redeemable Non-controlling Interest in Consolidated Joint Ventures:
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||