LIGHTSTONE VALUE PLUS REIT V, INC. Item 2.01 Completion of Acquisition or Disposition of Assets
OnNovember 15, 2021 ,Lightstone Value Plus REIT V, Inc. ("Lightstone REIT V" or the "Company"), through subsidiaries, (collectively, the "Sellers") entered into an agreement (the "River Club Agreement") to sell theRiver Club Apartments and the Townhomes atRiver Club , two student housing complexes with a total of 1,134 beds, (collectively, the "River Club Properties ") located inAthens, Georgia , toTGA River Club Apartments LLC andTGA River Club Townhomes LLC , (collectively, the "Buyers") unaffiliated third parties, for an aggregate contractual sales price of$77.3 million . OnDecember 22, 2021 , the Sellers completed the sale of theRiver Club Properties to the Buyers for$77.3 million pursuant to the terms of the River Club Agreement. In connection with the transaction, the Sellers repaid in full the existing outstanding mortgage indebtedness of$30.4 million secured by theRiver Club Properties (the "River Club Mortgage"). Additionally, prior to the sale of theRiver Club Properties , the Company paid approximately$10.2 million for the 15.0% membership interest held in theRiver Club Properties by a minority owner and as a result, at the time of the completion of the sale of theRiver Club Properties , owned 100.0% of the membership interests in theRiver Club Properties . The Company's net proceeds from the disposition of theRiver Club Properties were approximately$45.1 million , after the repayment in full of the River Club Mortgage, closing costs, expenses and pro rations and other
working capital adjustments.
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Item 9.01 Financial Statements and Exhibits.
(b) Pro forma financial information.
OnNovember 15, 2021 ,Lightstone Value Plus REIT V, Inc. ("Lightstone REIT V" or the "Company"), through subsidiaries, (collectively, the "Sellers") entered into an agreement (the "River Club Agreement") to sell theRiver Club Apartments and the Townhomes atRiver Club , two student housing complexes with a total of 1,134 beds, (collectively, the "River Club Properties ") located inAthens, Georgia , toTGA River Club Apartments LLC andTGA River Club Townhomes LLC , (collectively, the "Buyers") unaffiliated third parties, for an aggregate contractual sales price of$77.3 million . OnDecember 22, 2021 , the Sellers completed the sale of theRiver Club Properties to the Buyers for$77.3 million pursuant to the terms of the River Club Agreement. In connection with the transaction, the Sellers repaid in full the existing outstanding mortgage indebtedness of$30.4 million secured by theRiver Club Properties (the "River Club Mortgage"). Additionally, prior to the sale of theRiver Club Properties , the Company paid approximately$10.2 million for the 15.0% membership interest in theRiver Club Properties held by a minority owner and as a result, at the time of the completion of the sale of theRiver Club Properties , owned 100.0% of the membership interests of theRiver Club Properties . The Company's net proceeds from the disposition of theRiver Club Properties were approximately$45.1 million , after the repayment of the River Club Mortgage, closing costs, expenses and pro rations and other working capital adjustments.
The Company's unaudited pro forma consolidated balance sheet at
The unaudited pro forma condensed consolidated statements of operations for the nine months endedSeptember 30, 2021 and for the year endedDecember 31, 2020 include certain pro forma adjustments to illustrate the estimated effect of the disposition of theRiver Club Properties as if it had occurred on the first day of the earliest period presented. The unaudited pro forma consolidated financial statements are presented for informational purposes only and do not purport to be indicative of the Company's financial results as if the disposition of theRiver Club Properties had occurred on the first day of the earliest period presented. Further, the unaudited pro forma consolidated financial statements should not be viewed as indicative of the Company's financial results in the future; and should be read in conjunction with the Company's the audited historical consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the year endedDecember 31, 2020 , filed onMarch 25, 2021 and the Company's Quarterly Report on Form 10-Q for the quarter endedSeptember 30, 2021 , filed onNovember 12, 2021 . 3 LIGHTSTONE VALUE PLUS REIT V, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET AS OF SEPTEMBER 30, 2021 (Amounts in thousands) Lightstone Value Plus REIT V, Inc. Pro Forma Pro Forma (Historical) Adjustments Total Assets Net investment property $ 320,625$ (20,879 ) a$ 299,746 Cash and cash equivalents 38,065 77,250 b 72,966 (30,359 ) b (1,407 ) b (355 ) b (10,228 ) c Note receivable, net 13,742 - 13,742 Other assets 14,970 - 14,970 Total Assets $ 387,402$ 14,022 $ 401,424
Liabilities and Stockholders' Equity
Notes payable, net $ 270,593$ (30,359 ) b$ 240,234 Accounts payable and accrued and other liabilities 8,502 - 8,502 Total liabilities 279,095 (30,359 ) 248,736Total Company's stockholders' equity 109,770
42,998 d 152,768
Noncontrolling interests (1,463 ) 1,383 a (80 )
Total Stockholders' Equity 108,307 44,381 152,688 Total Liabilities and Stockholders' Equity $ 387,402
$ 14,022 $ 401,424 The accompanying notes are an integral part of these unaudited pro forma condensed consolidated financial statements. 4 LIGHTSTONE VALUE PLUS REIT V, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2021 (Amounts in thousands, except per share data) Lightstone Value Plus REIT V, Inc. Pro Forma Pro Forma (Historical) Adjustments (a) Total Rental revenues $ 30,864 $ (4,899 )$ 25,965
Expenses
Property operating expenses 10,336 (1,994 ) 8,342 Real estate taxes 4,228 (449 ) 3,779 General and administrative 5,046 (25 ) 5,021 Depreciation and amortization 9,590
(1,166 ) 8,424
Total operating expenses 29,200 (3,634 ) 25,566
Operating income 1,664 (1,265 ) 399
Interest expense, net (7,403 ) 482 (6,921 )
Interest income 1,493 - 1,493Gain on sale of investment property 27,821 - 27,821 Gain on disposition of unconsolidated joint venture 1,457
- 1,457
Other income, net 490 (41 ) 449
Net income 25,522 (824 ) 24,698Net income attributable to noncontrolling interests (145 ) 124 (21 )
Net income attributable to the Company's shares $ 25,377 $
(700 ) $ 24,677
Weighted average shares outstanding:
Basic and diluted 20,181 20,181
Basic and diluted loss per share $ 1.26 $ 1.22 5 LIGHTSTONE VALUE PLUS REIT V, INC. AND SUBSIDIARIES UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS FOR THE YEAR ENDED DECEMBER 31, 2020 (Amounts in thousands, except per share data) Lightstone Value Plus REIT V, Inc. Pro Forma Pro Forma (Historical) Adjustments (a) Total Rental revenues $ 39,978 $ (6,271 )$ 33,707
Expenses
Property operating expenses 13,049 (2,462 ) 10,587 Real estate taxes 5,454 (541 ) 4,913 General and administrative 6,493 (33 ) 6,460 Depreciation and amortization 12,227
(1,529 ) 10,698
Total operating expenses 37,223 (4,565 ) 32,658
Operating income 2,755 (1,706 ) 1,049
Interest expense, net (9,644 ) 799 (8,845 )
Interest income 1,877 - 1,877Gain on sale of investment property 5,474
- 5,474
Other income, net 721 (22 ) 699
Net income 1,183 (929 ) 254Net income attributable to noncontrolling interests (1,298 ) 139 (1,159 ) Net loss attributable to the Company's shares $ (115 ) $ (790 )$ (905 ) Weighted average shares outstanding: Basic and diluted 20,741 20,741 Basic and diluted loss per share $ (0.01 )
$ (0.04 ) 6 LIGHTSTONE VALUE PLUS REIT V, INC. AND SUBSIDIARIES NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Dollars in thousands unless otherwise indicated)
1. Basis of Pro Forma Presentation
The pro forma condensed consolidated financial statements included herein have
been prepared pursuant to the rules and regulations of the
The unaudited pro forma condensed consolidated financial statements ofLightstone Value Plus REIT V, Inc. (the "Company"), have been prepared based on the historical consolidated balance sheet of the Company as ofSeptember 30, 2021 and the historical consolidated statement of operations of the Company for the nine months endedSeptember 30, 2021 and for the for the year endedDecember 31, 2020 . The Company employs accounting policies that are in accordance with accounting principles generally accepted inthe United States of America . In management's opinion, all material adjustments necessary to reflect fairly the pro forma financial position and pro forma results of operations of the Company have
been made. The ongoing activity presented in these pro forma condensed consolidated financial statements represents the Company's assets, liabilities, revenues and expenses that reflect the disposition of theRiver Club Apartments and the Townhomes atRiver Club , two student housing complexes with a total of 1,134 beds, (collectively, the "River Club Properties ") located inAthens, Georgia . This pro forma financial information is presented for illustrative purposes only, and is not necessarily indicative of the consolidated operating results and consolidated financial position that might have been achieved had the transaction described above occurred on the dates indicated, nor are they necessarily indicative of the operating results and financial position that
may occur in the future. 2. Pro Forma Assumptions Pro forma adjustments: The accompanying condensed consolidated unaudited pro forma financial statements have been prepared as if the disposition of theRiver Club Properties was completed onSeptember 30, 2021 for balance sheet purposes andJanuary 1, 2020 for statement of operations purposes and reflect the following pro forma adjustments:
Adjustments to Unaudited Pro Forma Consolidated Balance Sheet
a) To reflect the elimination of the net book value of the
assets sold.
b) To reflect the net cash proceeds of
the disposition of the River Club Properties .
Reconciliation of Pro Forma Proceeds
(amounts in thousands)
Gross Proceeds $ 77,250 Repayment in full of outstanding mortgage indebtedness secured by the
(30,359 )
Closing costs paid from gross proceeds (1,407 )
Net operating costs paid at closing (355 ) Pro forma net proceeds$ 45,129 7
c) To reflect the payment of
of the minority partner in the
of the
d) To record the pro forma net gain of
River Club Properties . Reconciliation of ProForma Net Gain (amounts in thousands) Gross Proceeds$ 77,250 Net book value of assets sold (22,262 )
Purchase of noncontrolling interest (10,228 ) Closing costs paid from gross proceeds (1,407 ) Net operating costs received at closing (355 )
Pro forma net gain$ 42,998
Adjustments to Unaudited Pro Forma Consolidated Statements of Operations
a) These amounts represent the elimination of the operations on the completed
disposition of the
the nine months ended September 30, 2021 and for the for the year ended
December 31, 2020 , to give effect to the completed disposition as if it
had occurred on the first day of the earliest period presented.
3. Unaudited Pro Forma Earnings Per Share Data
The Company had no potentially dilutive securities outstanding during the
periods presented. Accordingly, pro forma earnings per share is calculated by
dividing net income attributable to the Company's common shareholders by the
weighted-average number of shares of common stock outstanding during the
applicable period.
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