UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
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None
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
Title of Each Class |
|
Trading Symbol(s) |
|
Name of Each Exchange on Which Registered |
None |
|
None |
|
None |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.01. Completion of Acquisition or Disposition of Asset.
On July 31, 2024, a subsidiary of Strategic Student & Senior Housing Trust, Inc. (the “Registrant”) sold the Registrant’s sole remaining student housing property located in Fayetteville, Arkansas (the “Fayetteville Property”) to YOUnion at Fayetteville SPE, LLC (the “Buyer”). Buyer is a subsidiary of a joint venture (the “Joint Venture”) between an affiliate of Virtus Real Estate, LLC (“Virtus”) and an affiliate of our sponsor, Strategic Asset Management I, LLC (“SAM”). The Virtus affiliate owns 95% and the SAM affiliate owns 5% of the Joint Venture. In addition, a SAM affiliate serves as the property manager of the Fayetteville Property on behalf of the Joint Venture. The sale price for the Fayetteville Property was $72.25 million in cash, less closing costs. The mortgage loan encumbering the Fayetteville Property of approximately $34.5 million was repaid in full at closing. The net proceeds from the sale of the Fayetteville Property will be primarily used to repay the total outstanding balance on the KeyBank Bridge Loan of approximately $25.4 million, and the remainder of the net proceeds will be used for other corporate purposes, including but not limited to payment of a disposition fee and reimbursement of fees and expenses owed to the advisor of the Registrant, a subsidiary of SAM, and distributions to stockholders. The Fayetteville Property was purchased by the Registrant in the second quarter of 2017 for a purchase price of $57 million, excluding acquisition costs.
Item 9.01. Financial Statements and Exhibits.
(b) Pro forma Financial Information.
The unaudited pro forma consolidated balance sheet of the Registrant, as of March 31, 2024, and the unaudited pro forma consolidated statements of operations for the three months ended March 31, 2024 and 2023, and for the years ended December 31, 2023, 2022, and 2021, are filed as Exhibit 99.1 to the Current Report on Form 8-K and are incorporated herein by reference.
(d) Exhibits.
99.1 |
|
104 |
Cover Page Interactive Data File (embedded within the inline XBRL document). |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
Strategic STUDENT & SENIOR HOUSING Trust, Inc.
Date: August 2, 2024 |
By: |
/s/ Matt F. Lopez |
|
|
Matt F. Lopez |
|
|
Chief Financial Officer, Treasurer, and Secretary |
|
|
(Principal Financial and Accounting Officer) |
Exhibit 99.1
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
INDEX TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
1
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
SUMMARY OF UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
On July 31, 2024, a subsidiary of Strategic Student & Senior Housing Trust, Inc. (the “Registrant”) sold the Registrant’s sole remaining student housing property located in Fayetteville, Arkansas (the “Fayetteville Property”) to YOUnion at Fayetteville SPE, LLC (the “Buyer”). Buyer is a subsidiary of a joint venture (the “Joint Venture”) between an affiliate of Virtus Real Estate, LLC (“Virtus”) and an affiliate of our sponsor, Strategic Asset Management I, LLC (“SAM”). The Virtus affiliate owns 95% and the SAM affiliate owns 5% of the Joint Venture. In addition, a SAM affiliate serves as the property manager of the Fayetteville Property on behalf of the Joint Venture. The sale price for the Fayetteville Property was $72.25 million in cash, less closing costs. The mortgage loan encumbering the Fayetteville Property of approximately $34.5 million was repaid in full at closing. The net proceeds from the sale of the Fayetteville Property will be primarily used to repay the KeyBank Bridge Loan of approximately $25.4 million, and the remainder of the net proceeds will be used for other corporate purposes, including but not limited to payment of disposition fee and reimbursement of fees and expenses owed to the advisor of the Registrant, a subsidiary of SAM, and distributions to stockholders. The Fayetteville property sale qualified as discontinued operations as the property met the criteria of held for sale as of June 16, 2024, and the disposal represents a strategic shift in our business as we no longer own or operate any student housing properties after the sale.
The accompanying unaudited pro forma consolidated financial information gives effect to the sale of the Fayetteville Property. The unaudited pro forma balance sheet of the Registrant as of March 31, 2024 is presented as if the sale of the Fayetteville Property had occurred on March 31, 2024. Since the Fayetteville Property sale qualified as discontinued operations, the accompanying unaudited pro forma consolidated statements of operations of the Registrant for the three months ended March 31, 2024 and 2023, and for the years ended December 31, 2023, 2022, and 2021, are presented as if the Fayetteville Property sale occurred on January 1, 2021 and the proceeds were received and used on January 1, 2021.
The accompanying unaudited pro forma consolidated financial statements reflect all adjustments that in the opinion of management, are necessary to present fairly the pro forma results of operations and financial position of the Registrant as of and for the periods indicated. The accompanying unaudited pro forma consolidated financial statements are presented for illustrative and informational purposes only and are not intended to represent or be indicative of the financial condition or results of operations that would have actually occurred had the transactions occurred on the date or at the beginning of the periods indicated, nor does it purport to represent the Registrant's future financial position or results of operations. The unaudited pro forma adjustments are based on information and assumptions that management considers reasonable and factually supportable.
Since the information presented below is only a summary and does not provide all of the information contained in the historical consolidated financial statements of the Registrant you should read “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Registrant's historical consolidated financial statements and notes thereto included in the Registrant's Annual Report on Form 10-K for the years ended December 31, 2023, 2022, and 2021 and its Quarterly Report on Form 10-Q for the three months ended March 31, 2024 and 2023.
2
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED BALANCE SHEET
March 31, 2024
|
|
Strategic Student & Senior Housing Trust, Inc. |
|
Fayetteville Sale (2) |
Note 3 |
Strategic Student & Senior Housing Trust, Inc. |
ASSETS |
|
|
|
|
|
|
Real estate facilities: |
|
|
|
|
|
|
Land |
|
$16,908,000 |
|
$(4,903,000) |
a |
$12,005,000 |
Buildings |
|
199,202,635 |
|
(45,929,599) |
a |
153,273,036 |
Site improvements |
|
3,587,917 |
|
(839,000) |
a |
2,748,917 |
Furniture, fixtures and equipment |
|
12,548,889 |
|
(3,257,503) |
a |
9,291,386 |
|
|
232,247,441 |
|
(54,929,102) |
|
177,318,339 |
Accumulated depreciation |
|
(42,196,030) |
|
11,499,267 |
a |
(30,696,763) |
|
|
190,051,411 |
|
(43,429,835) |
|
146,621,576 |
Construction in process |
|
431,585 |
|
(51,034) |
a |
380,551 |
Total real estate facilities, net |
|
190,482,996 |
|
(43,480,869) |
|
147,002,127 |
Cash and cash equivalents |
|
5,785,082 |
|
14,851,748 |
b |
20,636,830 |
Restricted cash |
|
1,933,202 |
|
— |
|
1,933,202 |
Other assets |
|
1,312,291 |
|
645,975 |
c |
1,958,266 |
Total assets |
|
$199,513,571 |
|
$(27,983,146) |
|
$171,530,425 |
LIABILITIES, TEMPORARY EQUITY, AND EQUITY (DEFICIT) |
|
|
|
|
|
|
Debt, net |
|
$160,190,756 |
|
$(54,846,899) |
d |
$105,343,857 |
Accounts payable and accrued liabilities |
|
3,935,416 |
|
(1,024,811) |
e |
2,910,605 |
Due to affiliates |
|
16,468,605 |
|
147,813 |
f |
16,616,418 |
Distributions payable |
|
7,209,841 |
|
— |
|
7,209,841 |
Total liabilities |
|
187,804,618 |
|
(55,723,897) |
|
132,080,721 |
Commitments and contingencies |
|
|
|
|
|
|
Redeemable common stock |
|
5,350,610 |
|
— |
|
5,350,610 |
Preferred equity in our Operating Partnership |
|
10,165,594 |
|
— |
|
10,165,594 |
Equity (Deficit): |
|
|
|
|
|
|
Strategic Student & Senior Housing Trust, Inc. Equity (Deficit): |
|
|
|
|
|
|
Preferred stock, $0.001 par value; 200,000,000 shares authorized; none issued |
|
— |
|
— |
|
— |
Class A Common stock, $0.001 par value; 245,000,000 shares authorized; |
|
11,632 |
|
— |
|
11,632 |
Class T Common stock, $0.001 par value; 115,000,000 shares authorized; |
|
78 |
|
— |
|
78 |
Class W Common stock, $0.001 par value; 70,000,000 shares authorized; |
|
87 |
|
— |
|
87 |
Class Y Common stock, $0.001 par value; 200,000,000 shares authorized; |
|
1,122 |
|
— |
|
1,122 |
Class Z Common stock, $0.001 par value; 70,000,000 shares authorized; |
|
167 |
|
— |
|
167 |
Additional paid-in capital |
|
97,733,091 |
|
— |
|
97,733,091 |
Distributions |
|
(17,722,288) |
|
— |
|
(17,722,288) |
Accumulated deficit |
|
(82,695,080) |
|
27,685,381 |
g |
(55,009,699) |
Total Strategic Student & Senior Housing Trust, Inc. equity (deficit) |
|
(2,671,191) |
|
27,685,381 |
|
25,014,190 |
Noncontrolling interests in our Operating Partnership |
|
(1,136,060) |
|
55,370 |
h |
(1,080,690) |
Total equity (deficit) |
|
(3,807,251) |
|
27,740,751 |
|
23,933,500 |
Total liabilities, temporary equity, and equity (deficit) |
|
$199,513,571 |
|
$(27,983,146) |
|
$171,530,425 |
See accompanying notes to the unaudited pro forma consolidated financial statements.
3
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 2024
|
|
Strategic Student & Senior Housing Trust, Inc. |
|
|
Fayetteville Sale (2) |
|
Note 4 |
Strategic Student & Senior Housing Trust, Inc. |
|
|||
Revenues: |
|
|
|
|
|
|
|
|
|
|||
Leasing and related revenues – student |
|
$ |
1,439,176 |
|
|
$ |
(1,439,176 |
) |
i |
$ |
— |
|
Leasing and related revenues – senior |
|
|
8,376,011 |
|
|
|
— |
|
|
|
8,376,011 |
|
Total revenues |
|
|
9,815,187 |
|
|
|
(1,439,176 |
) |
|
|
8,376,011 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Property operating expenses – student |
|
|
629,075 |
|
|
|
(629,075 |
) |
j |
|
— |
|
Property operating expenses – senior |
|
|
6,257,400 |
|
|
|
— |
|
|
|
6,257,400 |
|
Property operating expenses – affiliates |
|
|
625,848 |
|
|
|
(126,455 |
) |
k |
|
499,393 |
|
General and administrative |
|
|
432,925 |
|
|
|
— |
|
|
|
432,925 |
|
Depreciation |
|
|
1,677,835 |
|
|
|
(355,835 |
) |
l |
|
1,322,000 |
|
Total operating expenses |
|
|
9,623,083 |
|
|
|
(1,111,365 |
) |
|
|
8,511,718 |
|
Income (loss) from operations |
|
|
192,104 |
|
|
|
(327,811 |
) |
|
|
(135,707 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|||
Interest expense |
|
|
(2,249,291 |
) |
|
|
924,009 |
|
m |
|
(1,325,282 |
) |
Interest expense – debt issuance costs |
|
|
(130,613 |
) |
|
|
95,093 |
|
m |
|
(35,520 |
) |
Other |
|
|
(34,863 |
) |
|
|
— |
|
|
|
(34,863 |
) |
Net loss from continuing operations |
|
|
(2,222,663 |
) |
|
|
691,291 |
|
|
|
(1,531,372 |
) |
Less: Distributions to preferred unitholders in our Operating Partnership |
|
|
(347,582 |
) |
|
|
— |
|
|
|
(347,582 |
) |
Net loss from continuing operations attributable to the noncontrolling interests in our Operating Partnership |
|
|
5,100 |
|
|
|
(1,383 |
) |
n |
|
3,717 |
|
Net loss from continuing operations attributable to Strategic Student & Senior Housing Trust, Inc. common stockholders |
|
$ |
(2,565,145 |
) |
|
$ |
689,908 |
|
|
$ |
(1,875,237 |
) |
Net (loss) income per common share attributable to common shareholders - continuing operations: |
|
|
|
|
|
|
|
|
|
|||
Net loss per Class A share – basic and diluted |
|
$ |
(0.20 |
) |
|
|
|
|
$ |
(0.14 |
) |
|
Net loss per Class T share – basic and diluted |
|
$ |
(0.20 |
) |
|
|
|
|
$ |
(0.14 |
) |
|
Net loss per Class W share – basic and diluted |
|
$ |
(0.20 |
) |
|
|
|
|
$ |
(0.14 |
) |
|
Net loss per Class Y share – basic and diluted |
|
$ |
(0.20 |
) |
|
|
|
|
$ |
(0.14 |
) |
|
Net loss per Class Z share – basic and diluted |
|
$ |
(0.20 |
) |
|
|
|
|
$ |
(0.14 |
) |
|
Weighted average Class A shares outstanding – |
|
|
11,626,680 |
|
|
|
|
|
|
11,626,680 |
|
|
Weighted average Class T shares outstanding – |
|
|
77,598 |
|
|
|
|
|
|
77,598 |
|
|
Weighted average Class W shares outstanding – |
|
|
85,548 |
|
|
|
|
|
|
85,548 |
|
|
Weighted average Class Y shares outstanding – |
|
|
1,123,349 |
|
|
|
|
|
|
1,123,349 |
|
|
Weighted average Class Z shares outstanding – |
|
|
166,494 |
|
|
|
|
|
|
166,494 |
|
|
See accompanying notes to the unaudited pro forma consolidated financial statements.
4
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Three Months Ended March 31, 2023
|
|
Strategic Student & Senior Housing Trust, Inc. |
|
|
Fayetteville Sale (2) |
|
Note 4 |
Strategic Student & Senior Housing Trust, Inc. |
|
|||
Revenues: |
|
|
|
|
|
|
|
|
|
|||
Leasing and related revenues – student |
|
$ |
1,216,951 |
|
|
$ |
(1,216,951 |
) |
i |
$ |
— |
|
Leasing and related revenues – senior |
|
|
7,883,845 |
|
|
|
— |
|
|
|
7,883,845 |
|
Total revenues |
|
|
9,100,796 |
|
|
|
(1,216,951 |
) |
|
|
7,883,845 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Property operating expenses – student |
|
|
650,403 |
|
|
|
(650,403 |
) |
j |
|
— |
|
Property operating expenses – senior |
|
|
5,738,543 |
|
|
|
— |
|
|
|
5,738,543 |
|
Property operating expenses – affiliates |
|
|
615,864 |
|
|
|
(124,096 |
) |
k |
|
491,768 |
|
General and administrative |
|
|
501,758 |
|
|
|
— |
|
|
|
501,758 |
|
Depreciation |
|
|
1,786,268 |
|
|
|
(344,240 |
) |
l |
|
1,442,028 |
|
Total operating expenses |
|
|
9,292,836 |
|
|
|
(1,118,739 |
) |
|
|
8,174,097 |
|
Income (loss) from operations |
|
|
(192,040 |
) |
|
|
(98,212 |
) |
|
|
(290,252 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|||
Interest expense |
|
|
(2,208,950 |
) |
|
|
877,412 |
|
m |
|
(1,331,538 |
) |
Interest expense – debt issuance costs |
|
|
(80,214 |
) |
|
|
44,690 |
|
m |
|
(35,524 |
) |
Other |
|
|
954 |
|
|
|
— |
|
|
|
954 |
|
Net loss from continuing operations |
|
|
(2,480,250 |
) |
|
|
823,890 |
|
|
|
(1,656,360 |
) |
Less: Distributions to preferred unitholders in our Operating Partnership |
|
|
(322,853 |
) |
|
|
— |
|
|
|
(322,853 |
) |
Net loss from continuing operations attributable to the noncontrolling interests in our Operating Partnership |
|
|
5,370 |
|
|
|
(1,648 |
) |
n |
|
3,722 |
|
Net loss from continuing operations attributable to Strategic Student & Senior Housing Trust, Inc. common stockholders |
|
$ |
(2,797,733 |
) |
|
$ |
822,242 |
|
|
$ |
(1,975,491 |
) |
Net (loss) income per common share attributable to common shareholders - continuing operations: |
|
|
|
|
|
|
|
|
|
|||
Net loss per Class A share – basic and diluted |
|
$ |
(0.21 |
) |
|
|
|
|
$ |
(0.15 |
) |
|
Net loss per Class T share – basic and diluted |
|
$ |
(0.21 |
) |
|
|
|
|
$ |
(0.15 |
) |
|
Net loss per Class W share – basic and diluted |
|
$ |
(0.21 |
) |
|
|
|
|
$ |
(0.15 |
) |
|
Net loss per Class Y share – basic and diluted |
|
$ |
(0.21 |
) |
|
|
|
|
$ |
(0.15 |
) |
|
Net loss per Class Z share – basic and diluted |
|
$ |
(0.21 |
) |
|
|
|
|
$ |
(0.15 |
) |
|
Weighted average Class A shares outstanding – |
|
|
11,624,180 |
|
|
|
|
|
|
11,624,180 |
|
|
Weighted average Class T shares outstanding – |
|
|
77,598 |
|
|
|
|
|
|
77,598 |
|
|
Weighted average Class W shares outstanding – |
|
|
85,548 |
|
|
|
|
|
|
85,548 |
|
|
Weighted average Class Y shares outstanding – |
|
|
1,123,349 |
|
|
|
|
|
|
1,123,349 |
|
|
Weighted average Class Z shares outstanding – |
|
|
166,494 |
|
|
|
|
|
|
166,494 |
|
|
See accompanying notes to the unaudited pro forma consolidated financial statements.
5
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Year Ended December 31, 2023
|
|
Strategic Student & Senior Housing Trust, Inc. |
|
|
Fayetteville Sale (2) |
|
Note 4 |
Strategic Student & Senior Housing Trust, Inc. |
|
|||
Revenues: |
|
|
|
|
|
|
|
|
|
|||
Leasing and related revenues – student |
|
$ |
5,076,260 |
|
|
$ |
(5,076,260 |
) |
i |
$ |
— |
|
Leasing and related revenues – senior |
|
|
32,592,265 |
|
|
|
— |
|
|
|
32,592,265 |
|
Total revenues |
|
|
37,668,525 |
|
|
|
(5,076,260 |
) |
|
|
32,592,265 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Property operating expenses – student |
|
|
2,679,173 |
|
|
|
(2,679,173 |
) |
j |
|
— |
|
Property operating expenses – senior |
|
|
23,550,735 |
|
|
|
— |
|
|
|
23,550,735 |
|
Property operating expenses – affiliates |
|
|
2,484,303 |
|
|
|
(500,117 |
) |
k |
|
1,984,186 |
|
General and administrative |
|
|
2,441,031 |
|
|
|
— |
|
|
|
2,441,031 |
|
Depreciation |
|
|
7,070,186 |
|
|
|
(1,398,771 |
) |
l |
|
5,671,415 |
|
Total operating expenses |
|
|
38,225,428 |
|
|
|
(4,578,061 |
) |
|
|
33,647,367 |
|
Income (loss) from operations |
|
|
(556,903 |
) |
|
|
(498,199 |
) |
|
|
(1,055,102 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|||
Interest expense |
|
|
(9,023,857 |
) |
|
|
3,655,147 |
|
m |
|
(5,368,710 |
) |
Interest expense – debt issuance costs |
|
|
(320,856 |
) |
|
|
178,755 |
|
m |
|
(142,101 |
) |
Other |
|
|
147,631 |
|
|
|
— |
|
|
|
147,631 |
|
Net loss from continuing operations |
|
|
(9,753,985 |
) |
|
|
3,335,703 |
|
|
|
(6,418,282 |
) |
Less: Distributions to preferred unitholders in our Operating Partnership |
|
|
(1,341,278 |
) |
|
|
— |
|
|
|
(1,341,278 |
) |
Net loss from continuing operations attributable to the noncontrolling interests in our Operating Partnership |
|
|
21,688 |
|
|
|
(6,671 |
) |
n |
|
15,017 |
|
Net loss from continuing operations attributable to Strategic Student & Senior Housing Trust, Inc. common stockholders |
|
$ |
(11,073,575 |
) |
|
$ |
3,329,032 |
|
|
$ |
(7,744,543 |
) |
Net (loss) income per common share attributable to common shareholders - continuing operations: |
|
|
|
|
|
|
|
|
|
|||
Net loss per Class A share – basic and diluted |
|
$ |
(0.85 |
) |
|
|
|
|
$ |
(0.59 |
) |
|
Net loss per Class T share – basic and diluted |
|
$ |
(0.85 |
) |
|
|
|
|
$ |
(0.59 |
) |
|
Net loss per Class W share – basic and diluted |
|
$ |
(0.85 |
) |
|
|
|
|
$ |
(0.59 |
) |
|
Net loss per Class Y share – basic and diluted |
|
$ |
(0.85 |
) |
|
|
|
|
$ |
(0.59 |
) |
|
Net loss per Class Z share – basic and diluted |
|
$ |
(0.85 |
) |
|
|
|
|
$ |
(0.59 |
) |
|
Weighted average Class A shares outstanding – |
|
|
11,625,584 |
|
|
|
|
|
|
11,625,584 |
|
|
Weighted average Class T shares outstanding – |
|
|
77,598 |
|
|
|
|
|
|
77,598 |
|
|
Weighted average Class W shares outstanding – |
|
|
85,548 |
|
|
|
|
|
|
85,548 |
|
|
Weighted average Class Y shares outstanding – |
|
|
1,123,349 |
|
|
|
|
|
|
1,123,349 |
|
|
Weighted average Class Z shares outstanding – |
|
|
166,494 |
|
|
|
|
|
|
166,494 |
|
|
See accompanying notes to the unaudited pro forma consolidated financial statements.
6
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Year Ended December 31, 2022
|
|
Strategic Student & Senior Housing Trust, Inc. |
|
|
Fayetteville Sale (2) |
|
Note 4 |
Strategic Student & Senior Housing Trust, Inc. |
|
|||
Revenues: |
|
|
|
|
|
|
|
|
|
|||
Leasing and related revenues – student |
|
$ |
4,522,789 |
|
|
$ |
(4,370,557 |
) |
i |
$ |
152,232 |
|
Leasing and related revenues – senior |
|
|
29,908,045 |
|
|
|
— |
|
|
|
29,908,045 |
|
Total revenues |
|
|
34,430,834 |
|
|
|
(4,370,557 |
) |
|
|
30,060,277 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Property operating expenses – student |
|
|
2,657,691 |
|
|
|
(2,579,638 |
) |
j |
|
78,053 |
|
Property operating expenses – senior |
|
|
21,562,383 |
|
|
|
— |
|
|
|
21,562,383 |
|
Property operating expenses – affiliates |
|
|
2,436,654 |
|
|
|
(493,302 |
) |
k |
|
1,943,352 |
|
General and administrative |
|
|
1,718,876 |
|
|
|
— |
|
|
|
1,718,876 |
|
Depreciation |
|
|
7,415,888 |
|
|
|
(1,831,648 |
) |
l |
|
5,584,240 |
|
Total operating expenses |
|
|
35,791,492 |
|
|
|
(4,904,588 |
) |
|
|
30,886,904 |
|
Gain on sale of real estate, net |
|
|
12,101,937 |
|
|
|
— |
|
|
|
12,101,937 |
|
Income (loss) from operations |
|
|
10,741,279 |
|
|
|
534,031 |
|
|
|
11,275,310 |
|
Other income (expense): |
|
|
|
|
|
|
|
|
|
|||
Interest expense |
|
|
(8,266,519 |
) |
|
|
2,802,912 |
|
m |
|
(5,463,607 |
) |
Interest expense – debt issuance costs |
|
|
(370,415 |
) |
|
|
215,031 |
|
m |
|
(155,384 |
) |
Loss on extinguishment of debt |
|
|
(1,985,602 |
) |
|
|
— |
|
|
|
(1,985,602 |
) |
Other |
|
|
606,608 |
|
|
|
— |
|
|
|
606,608 |
|
Net income (loss) from continuing operations |
|
|
725,351 |
|
|
|
3,551,974 |
|
|
|
4,277,325 |
|
Less: Distributions to preferred unitholders in our Operating Partnership |
|
|
(1,256,632 |
) |
|
|
— |
|
|
|
(1,256,632 |
) |
Net income (loss) from continuing operations attributable to the noncontrolling interests in our Operating Partnership |
|
|
(2,963 |
) |
|
|
(7,104 |
) |
n |
|
(10,067 |
) |
Net income (loss) from continuing operations attributable to Strategic Student & Senior Housing Trust, Inc. common stockholders |
|
$ |
(534,244 |
) |
|
$ |
3,544,870 |
|
|
$ |
3,010,626 |
|
Net (loss) income per common share attributable to common shareholders - continuing operations: |
|
|
|
|
|
|
|
|
|
|||
Net loss per Class A share – basic and diluted |
|
$ |
(0.04 |
) |
|
|
|
|
$ |
0.23 |
|
|
Net loss per Class T share – basic and diluted |
|
$ |
(0.04 |
) |
|
|
|
|
$ |
0.23 |
|
|
Net loss per Class W share – basic and diluted |
|
$ |
(0.04 |
) |
|
|
|
|
$ |
0.23 |
|
|
Net loss per Class Y share – basic and diluted |
|
$ |
(0.04 |
) |
|
|
|
|
$ |
0.23 |
|
|
Net loss per Class Z share – basic and diluted |
|
$ |
(0.04 |
) |
|
|
|
|
$ |
0.23 |
|
|
Weighted average Class A shares outstanding – |
|
|
11,622,536 |
|
|
|
|
|
|
11,622,536 |
|
|
Weighted average Class T shares outstanding – |
|
|
77,598 |
|
|
|
|
|
|
77,598 |
|
|
Weighted average Class W shares outstanding – |
|
|
85,548 |
|
|
|
|
|
|
85,548 |
|
|
Weighted average Class Y shares outstanding – |
|
|
1,123,349 |
|
|
|
|
|
|
1,123,349 |
|
|
Weighted average Class Z shares outstanding – |
|
|
166,494 |
|
|
|
|
|
|
166,494 |
|
|
See accompanying notes to the unaudited pro forma consolidated financial statements.
7
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
UNAUDITED PRO FORMA CONSOLIDATED STATEMENT OF OPERATIONS
For the Year Ended December 31, 2021
|
|
Strategic Student & Senior Housing Trust, Inc. |
|
|
Fayetteville Sale (2) |
|
Note 4 |
Strategic Student & Senior Housing Trust, Inc. |
|
|||
Revenues: |
|
|
|
|
|
|
|
|
|
|||
Leasing and related revenues – student |
|
$ |
8,090,778 |
|
|
$ |
(4,036,222 |
) |
i |
$ |
4,054,556 |
|
Leasing and related revenues – senior |
|
|
26,179,636 |
|
|
|
— |
|
|
|
26,179,636 |
|
Total revenues |
|
|
34,270,414 |
|
|
|
(4,036,222 |
) |
|
|
30,234,192 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|||
Property operating expenses – student |
|
|
4,098,690 |
|
|
|
(2,360,113 |
) |
j |
|
1,738,577 |
|
Property operating expenses – senior |
|
|
19,227,624 |
|
|
|
— |
|
|
|
19,227,624 |
|
Property operating expenses – affiliates |
|
|
2,832,734 |
|
|
|
(492,181 |
) |
k |
|
2,340,553 |
|
General and administrative |
|
|
1,278,446 |
|
|
|
— |
|
|
|
1,278,446 |
|
Depreciation |
|
|
8,674,660 |
|
|
|
(1,807,805 |
) |
l |
|
6,866,855 |
|
Intangible amortization expense |
|
|
626,332 |
|
|
|
— |
|
|
|
626,332 |
|
Total operating expenses |
|
|
36,738,486 |
|
|
|
(4,660,099 |
) |
|
|
32,078,387 |
|
Income (loss) from operations |
|
|
(2,468,072 |
) |
|
|
623,877 |
|
|
|
(1,844,195 |
) |
Other income (expense): |
|
|
|
|
|
|
|
|
|
|||
Interest expense |
|
|
(9,533,011 |
) |
|
|
2,423,012 |
|
m |
|
(7,109,999 |
) |
Interest expense – debt issuance costs |
|
|
(468,703 |
) |
|
|
277,175 |
|
m |
|
(191,528 |
) |
Forgiveness of PPP Loans |
|
|
1,971,157 |
|
|
|
— |
|
|
|
1,971,157 |
|
Other |
|
|
1,168,175 |
|
|
|
— |
|
|
|
1,168,175 |
|
Net income (loss) from continuing operations |
|
|
(9,330,454 |
) |
|
|
3,324,064 |
|
|
|
(6,006,390 |
) |
Less: Distributions to preferred unitholders in our |
|
|
(1,171,988 |
) |
|
|
— |
|
|
|
(1,171,988 |
) |
Less: Accretion of preferred equity costs |
|
|
(7,765 |
) |
|
|
— |
|
|
|
(7,765 |
) |
Net income (loss) from continuing operations attributable to the noncontrolling interests in our Operating Partnership |
|
|
22,666 |
|
|
|
(6,648 |
) |
n |
|
16,018 |
|
Net income (loss) from continuing operations attributable to Strategic Student & Senior Housing Trust, Inc. common stockholders |
|
$ |
(10,487,541 |
) |
|
$ |
3,317,416 |
|
|
$ |
(7,170,125 |
) |
Net (loss) income per common share attributable to common shareholders - continuing operations: |
|
|
|
|
|
|
|
|
|
|||
Net loss per Class A share – basic and diluted |
|
$ |
(0.80 |
) |
|
|
|
|
$ |
(0.55 |
) |
|
Net loss per Class T share – basic and diluted |
|
$ |
(0.80 |
) |
|
|
|
|
$ |
(0.55 |
) |
|
Net loss per Class W share – basic and diluted |
|
$ |
(0.80 |
) |
|
|
|
|
$ |
(0.55 |
) |
|
Net loss per Class Y share – basic and diluted |
|
$ |
(0.80 |
) |
|
|
|
|
$ |
(0.55 |
) |
|
Net loss per Class Z share – basic and diluted |
|
$ |
(0.80 |
) |
|
|
|
|
$ |
(0.55 |
) |
|
Weighted average Class A shares outstanding – |
|
|
11,619,060 |
|
|
|
|
|
|
11,619,060 |
|
|
Weighted average Class T shares outstanding – |
|
|
77,598 |
|
|
|
|
|
|
77,598 |
|
|
Weighted average Class W shares outstanding – |
|
|
85,548 |
|
|
|
|
|
|
85,548 |
|
|
Weighted average Class Y shares outstanding – |
|
|
1,123,349 |
|
|
|
|
|
|
1,123,349 |
|
|
Weighted average Class Z shares outstanding – |
|
|
166,494 |
|
|
|
|
|
|
166,494 |
|
|
See accompanying notes to the unaudited pro forma consolidated financial statements.
8
STRATEGIC STUDENT & SENIOR HOUSING TRUST, INC. AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Basis of Presentation
The historical column of the Unaudited Pro Forma Consolidated Balance Sheet as of March 31, 2024 was derived from the Registrant’s unaudited consolidated balance sheet included in the Registrant’s Quarterly Report on Form 10-Q filed with the SEC for the three months ended March 31, 2024. The historical column of the Unaudited Pro Forma Consolidated Statement of Operations for the three months ended March 31, 2024 and 2023, and the years ended December 31, 2023, 2022, and 2021, was derived from the Registrant’s unaudited and audited consolidated financial statements included in the Registrant’s Quarterly Reports on Form 10-Q and Annual Reports on Form 10-K filed with the SEC for the three months ended March 31, 2024, and the year ended December 31, 2023. The Fayetteville property sale qualified as discontinued operations as the property met the criteria of held for sale as of June 16, 2024, and the disposal represents a strategic shift in our business as we no longer own or operate student housing properties.
Unaudited Pro Forma Consolidated Balance Sheet as of March 31, 2024
(1) Reflects the Registrant's historical Consolidated Balance Sheet as of March 31, 2024.
(2) Amounts represent the adjustments necessary to remove the assets and liabilities associated with the Fayetteville Property, and exhibit the effect of the sale of the property as if it occurred on March 31, 2024.
Unaudited Pro Forma Consolidated Statement of Operations for the three months ended March 31, 2024
(1) Reflects the Registrant's historical Consolidated Statement of Operations for the three months ended March 31, 2024.
(2) Amounts represent the adjustments necessary to remove the effect of the Fayetteville Property from the Consolidated Statement of Operations as if the Fayetteville Property sale occurred on January 1, 2021.
Unaudited Pro Forma Consolidated Statement of Operations for the three months ended March 31, 2023
(1) Reflects the Registrant's historical Consolidated Statement of Operations for the three months ended March 31, 2023.
(2) Amounts represent the adjustments necessary to remove the effect of the Fayetteville Property from the Consolidated Statement of Operations as if the Fayetteville Property sale occurred on January 1, 2021.
Unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 2023
(1) Reflects the Registrant's historical Consolidated Statement of Operations for the year ended December 31, 2023.
(2) Amounts represent the adjustments necessary to remove the effect of the Fayetteville Property from the Consolidated Statement of Operations as if the Fayetteville Property sale occurred on January 1, 2021.
Unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 2022
(1) Reflects the Registrant's historical Consolidated Statement of Operations for the year ended December 31, 2022.
(2) Amounts represent the adjustments necessary to remove the effect of the Fayetteville Property from the Consolidated Statement of Operations as if the Fayetteville Property sale occurred on January 1, 2021.
Unaudited Pro Forma Consolidated Statement of Operations for the year ended December 31, 2021
(1) Reflects the Registrant's historical Consolidated Statement of Operations for the year ended December 31, 2021.
(2) Amounts represent the adjustments necessary to remove the effect of the Fayetteville Property from the Consolidated Statement of Operations as if the Fayetteville Property sale occurred on January 1, 2021.
9
Note 2. Property Sale
Fayetteville Sale
On July 31, 2024, the Registrant sold the Fayetteville Property. The sale price for the Fayetteville Property was $72.25 million in cash, less closing costs. Subsequent to March 31, 2024, on April 10, 2024, we entered into a $34.5 million mortgage loan with JPMorgan Chase Bank, N.A, which repaid and replaced the Registrant’s existing $29.5 million Fayetteville JPM Mortgage Loan. The JPM Mortgage Loan had an initial term of one year with a maturity date of April 9, 2025. The mortgage loan encumbering the Fayetteville Property of approximately $34.5 million was repaid in full at closing. In addition, the net proceeds from the sale of the Fayetteville Property were required to be used to repay in full the KeyBank Bridge Loan totaling approximately $25.5 million, and the remainder of the net proceeds will be used for other corporate purposes, including but not limited to payment of disposition fee and reimbursement of fees and expenses owed to the advisor of the Registrant, a subsidiary of SAM, and distributions to stockholders.
Note 3. Unaudited Consolidated Balance Sheet - Pro Forma Adjustments
(a) Represents the removal of real estate facilities, including related accumulated depreciation and construction in process, in conjunction with the Fayetteville Property sale as if it occurred on March 31, 2024.
(b) Represents the net cash received in conjunction with the Fayetteville Property sale as if it occurred March 31, 2024, after repayment of debt, escrow holdback, closing costs, and other liabilities.
(c) Represents the escrow holdback of approximately $0.7 million and removal of other assets of approximately $0.1 million associated with the Fayetteville Property sale as if it occurred March 31, 2024.
(d) Represents the payoffs of both the original JPM Fayetteville first mortgage of approximately $29.5 million and the KeyBank Bridge Loan of approximately $25.6 million, net associated debt issuance costs, in conjunction with the Fayetteville Property sale as if it occurred March 31, 2024.
(e) Represents the removal of all accounts payable and accrued liabilities assumed by the buyer or settled in conjunction with the sale of the Fayetteville Property as if it occurred March 31, 2024.
(f) Represents the removal of all due to/from affiliates associated with the Fayetteville Property, in conjunction with the sale as if it occurred March 31, 2024.
(g) Represents the preliminary net gain on sale of the Fayetteville Property as if it occurred March 31, 2024. The preliminary net gain calculation is subject to revision upon finalization of all closing contingencies and adjustments.
(h) Represents the net gain on the sale of Fayetteville Property attributable to the non-controlling interest in our Operating Partnership.
Note 4. Consolidated Statements of Operations - Pro Forma Adjustments
(i) Represents the removal of all leasing and related revenues related to the Fayetteville Property.
(j) Represents the removal of all property operating expenses related to the Fayetteville Property.
(k) Represents the removal of all property operating expenses - affiliates, which includes property management and asset management fees, related to the Fayetteville Property.
(l) Represents the removal of all depreciation related to the Fayetteville Property.
(m) Represents the removal of all interest expense and debt issuance costs related to the Fayetteville Property JPMorgan $29.5 million mortgage and the $25.6 million KeyBank bridge loan, which required repayment upon the sale of the Fayetteville Property.
(n) Represents the income (loss) from the operations of the Fayetteville Property attributable to the noncontrolling interests in our Operating Partnership.
10