Attached files
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EX-31.1 - CEO EXHIBIT 31.1 - MacKenzie Realty Capital, Inc. | exhibit31ceo.htm |
EX-32.2 - CFO EXHIBIT 32.2 - MacKenzie Realty Capital, Inc. | exhibit32cfo.htm |
EX-32.1 - CEO EXHIBIT 32.1 - MacKenzie Realty Capital, Inc. | exhibit32ceo.htm |
EX-31.2 - CFO EXHIBIT 31.2 - MacKenzie Realty Capital, Inc. | exhibit31cfo.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form 10-Q
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(Mark one)
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☑
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QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the quarterly period ended December 31, 2019
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☐
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TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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For the transition period from _________ to __________
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Commission file number 000-55006
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MacKenzie Realty Capital, Inc.
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(Exact name of registrant as specified in its charter)
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Maryland
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45-4355424
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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89 Davis Road, Suite 100, Orinda, CA 94563
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(Address of principal executive offices)
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(925) 631-9100
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(Registrant's telephone number, including area code)
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________________________________________________________________
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(Former name, former address and former fiscal year, if changed since last report)
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Securities registered pursuant to Section 12(b) of the Act: None
Indicate by check mark whether the registrant has (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☑ No ☐
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Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 or Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit such files.) Yes ☐ No ☐
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Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of "large accelerated filer,"
"accelerated filer," "smaller reporting company" and "emerging growth company" in Rule 12b-2 of the Exchange Act.
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Large accelerated filer ☐ Accelerated filer ☐ Non-accelerated filer ☑ Smaller reporting company ☐
Emerging growth company ☐
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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 ☐
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Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☑
Securities registered under Section 12(b) of the Act: None
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The number of the shares of issuer's Common Stock outstanding as of February 12, 2020 was 12,510,237.41.
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PART I.
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FINANCIAL INFORMATION
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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PART II.
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OTHER INFORMATION
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Item 1.
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Item 1A.
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Item 2.
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Item 3.
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Item 4.
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Item 5.
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Item 6.
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December 31, 2019
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June 30, 2019
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(Unaudited)
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Assets
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Investments, at fair value
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Non-controlled/non-affiliated investments (cost of $48,402,397 and $46,997,608, respectively)
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$
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47,812,270
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$
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48,839,999
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Affiliated investments (cost of $13,759,901 and $14,699,474, respectively)
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14,482,623
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15,916,187
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Controlled investments (cost of $43,341,173 and $35,541,173, respectively)
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47,977,465
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38,488,962
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Total investments, at fair value (cost of $105,503,471 and $97,238,255, respectively)
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110,272,358
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103,245,148
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Cash and cash equivalents
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3,003,939
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1,278,668
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Accounts receivable
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1,592,721
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3,170,068
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Other assets
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304,793
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219,050
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Deferred offering costs, net
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297,486
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440,320
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Total assets
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$
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115,471,297
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$
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108,353,254
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Liabilities
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Accounts payable and accrued liabilities
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$
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88,576
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$
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226,722
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Dividend payable
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2,096,915
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1,877,101
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Capital pending acceptance
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1,023,250
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668,165
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Due to related entities
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696,953
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2,465,885
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Total liabilities
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3,905,694
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5,237,873
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Net assets
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Common stock, $0.0001 par value, 80,000,000 shares authorized; 12,138,738.21 and 10,926,319.99 shares issued and outstanding, respectively
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1,214
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1,093
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Capital in excess of par value
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110,009,695
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99,077,308
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Total distributable earnings
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1,554,694
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4,036,980
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Total net assets
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111,565,603
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103,115,381
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Total liabilities and net assets
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$
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115,471,297
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$
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108,353,254
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Net asset value per share
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$
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9.19
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$
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9.44
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Name
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Asset Type
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Shares/Units
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Cost Basis
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Total
Fair Value |
% of
Net Assets |
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CBL & Associates Properties, Inc. - Preferred D
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(4)
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Publicly Traded Company
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188,000.00
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$ 1,707,042
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$ 930,600
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0.83
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Total Publicly Traded Company
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1,707,042
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930,600
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0.83
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Benefit Street Partners Realty Trust, Inc.
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(5)
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Non Traded Company
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183,169.61
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2,823,957
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2,485,612
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2.23
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Carter Validus Mission Critical REIT II, Inc. Class A
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(5)
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Non Traded Company
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167,826.26
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1,147,285
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1,201,636
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1.08
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CIM Real Estate Finance Trust, Inc.
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(5)
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Non Traded Company
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413,614.61
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2,461,996
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2,692,631
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2.41
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CNL Healthcare Properties, Inc.
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(5)
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Non Traded Company
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266,900.14
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1,554,356
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1,467,951
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1.32
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Cole Credit Property Trust V, Inc.
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(5)
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Non Traded Company
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36,825.76
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473,277
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536,920
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0.48
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Cole Credit Property Trust V, Inc. Class T
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(5)
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Non Traded Company
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395.88
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5,492
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5,772
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0.01
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Cole Office & Industrial REIT (CCIT II), Inc.
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(5)
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Non Traded Company
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11,048.42
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82,395
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89,603
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0.08
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Corporate Property Associates 18 Global A Inc.
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(5)
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Non Traded Company
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4,695.14
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39,627
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38,031
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0.03
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First Capital Real Estate Trust, Inc.
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(5)(6)
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Non Traded Company
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3,792.51
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15,161
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18,242
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0.02
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FSP 1441 Main Street
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(5)(6)
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Non Traded Company
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15.73
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8,559
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32,665
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0.03
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FSP 303 East Wacker Drive Corp. Liquidating Trust
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(5)(6)
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Non Traded Company
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3.00
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30
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631
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-
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FSP Energy Tower I Corp. Liquidating Trust
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(2)(5)(6)
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Non Traded Company
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19.35
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57,566
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58,921
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0.05
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FSP Grand Boulevard Liquidating Trust
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(5)(6)
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Non Traded Company
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7.50
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8
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2,657
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0.01
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FSP Satellite Place
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(2)(5)(6)
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Non Traded Company
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17.60
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545,988
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628,557
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0.56
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Griffin Capital Essential Asset REIT, Inc.
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(5)
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Non Traded Company
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22,982.73
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151,227
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170,762
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0.15
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Griffin-American Healthcare REIT III, Inc.
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(5)
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Non Traded Company
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4,496.87
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28,053
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32,108
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0.03
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GTJ REIT, Inc.
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(5)
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Non Traded Company
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1,000.00
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11,620
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11,460
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0.01
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Healthcare Trust, Inc.
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(5)
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Non Traded Company
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314,487.89
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3,549,807
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3,122,865
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2.80
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Highlands REIT Inc.
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(5)(6)
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Non Traded Company
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21,576,587.33
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3,993,678
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3,452,254
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3.09
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Hines Global REIT, Inc.
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(5)(6)
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Non Traded Company
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17,936.21
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120,637
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88,246
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0.08
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Hospitality Investors Trust, Inc.
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(5)(6)
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Non Traded Company
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18,766.77
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85,421
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74,879
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0.07
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InvenTrust Properties Corp.
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(5)
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Non Traded Company
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1,601,310.97
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2,006,003
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2,177,783
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1.95
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KBS Real Estate Investment Trust II, Inc.
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(5)(6)
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Non Traded Company
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1,365,338.21
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4,778,373
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3,959,481
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3.55
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KBS Real Estate Investment Trust III, Inc.
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(5)
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Non Traded Company
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65,717.13
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550,359
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565,167
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0.51
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New York City REIT, Inc.
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(5)(6)
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Non Traded Company
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233,047.69
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2,922,429
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2,996,993
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2.69
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NorthStar Healthcare Income, Inc.
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(5)(6)
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Non Traded Company
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23,573.29
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87,643
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61,291
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0.05
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Phillips Edison & Company, Inc
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(5)
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Non Traded Company
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843,528.95
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6,242,849
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6,891,631
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6.18
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SmartStop Self Storage REIT, Inc.
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(5)
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Non Traded Company
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2,330.00
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16,472
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21,180
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0.02
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Steadfast Apartment REIT
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(5)
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Non Traded Company
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2,083.29
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17,197
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26,479
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0.02
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Steadfast Income REIT
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(5)
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Non Traded Company
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116,961.62
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782,246
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802,357
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0.72
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Strategic Realty Trust, Inc.
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(5)
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Non Traded Company
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303,626.06
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1,215,173
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1,253,976
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1.12
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Summit Healthcare REIT, Inc.
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(2)(5)(6)
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Non Traded Company
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1,407,838.92
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1,924,502
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2,548,188
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2.28
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The Parking REIT Inc.
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(5)(6)
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Non Traded Company
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17,989.90
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230,880
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173,962
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0.16
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Total Non Traded Company (1)
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37,930,266
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37,690,891
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33.79
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3100 Airport Way South LP
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(5)
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LP Interest
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1.00
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355,000
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356,584
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0.32
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5210 Fountaingate, LP
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(2)(5)(6)
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LP Interest
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9.89
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500,000
|
526,835
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0.47
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Addison NC, LLC
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(3)(5)(6)
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LP Interest
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200,000.00
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2,000,000
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3,750,000
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3.36
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Addison Property Member, LLC
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(3)(5)
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LP Interest
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731,485.60
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7,316,326
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8,404,769
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7.53
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Bishop Berkeley, LLC
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(3)(5)
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LP Interest
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4,050.00
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4,050,000
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4,479,139
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4.01
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BP3 Affiliate, LLC
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(2)(5)(6)
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LP Interest
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1,538.00
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1,538,000
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1,538,000
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1.38
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BR Cabrillo LLC
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(5)(6)
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LP Interest
|
346,723.32
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104,942
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131,755
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0.12
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BR Everwood Investment Co, LLC
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(2)(5)
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LP Interest
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3,750,000.00
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3,750,000
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3,750,000
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3.36
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BR Westerly Investment Co, LLC
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(2)(5)
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LP Interest
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4,120,667.41
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4,120,667
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4,120,667
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3.69
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Britannia Preferred Members, LLC -Class 1
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(3)(5)(6)
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LP Interest
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103.88
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2,597,000
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3,246,250
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2.91
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Britannia Preferred Members, LLC -Class 2
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(3)(5)(6)
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LP Interest
|
514,858.30
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6,826,931
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7,002,073
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6.28
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Capitol Hill Partners, LLC
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(3)(5)(6)
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LP Interest
|
190,000.00
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1,900,000
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1,894,300
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1.70
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||||||
Citrus Park Hotel Holdings, LLC
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(3)(5)
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LP Interest
|
5,000,000.00
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5,000,000
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5,000,000
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4.48
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||||||
CRP I Roll Up, LLC
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(5)
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LP Interest
|
4,500,000.00
|
4,500,000
|
5,175,000
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4.64
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||||||
CRP III Roll Up, LLC
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(5)
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LP Interest
|
6,000,000.00
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6,000,000
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6,600,000
|
5.92
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||||||
Dimensions28 LLP
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(3)(5)
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LP Interest
|
10,800.00
|
10,801,015
|
11,363,328
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10.19
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||||||
Lakemont Partners, LLC
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(2)(5)
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LP Interest
|
1,000.00
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1,000,000
|
1,013,771
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0.91
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||||||
MPF Pacific Gateway - Class B
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(2)(5)(6)
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LP Interest
|
23.20
|
6,287
|
7,316
|
0.01
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||||||
Redwood Mortgage Investors VIII
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(5)
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LP Interest
|
56,300.04
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29,700
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36,594
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0.03
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||||||
Satellite Investment Holdings, LLC - Class B
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(5)(6)
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LP Interest
|
0.31
|
22
|
15,405
|
0.01
|
||||||
Secured Income, LP
|
(2)(5)(6)
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LP Interest
|
64,670.00
|
316,890
|
290,368
|
0.26
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||||||
Sunlit Holdings, LLC
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(3)(5)
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LP Interest
|
5,000,000.00
|
2,800,000
|
2,800,000
|
2.51
|
||||||
The Weatherly Building, LLC
|
(5)(6)
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LP Interest
|
17.50
|
118,721
|
47,846
|
0.04
|
||||||
The Weatherly, LTD
|
(5)(6)
|
LP Interest
|
60.00
|
184,761
|
63,261
|
0.06
|
||||||
Total LP Interest
|
|
|
|
65,816,262
|
71,613,261
|
64.19
|
||||||
|
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|
||||||
Coastal Realty Business Trust, REEP, Inc. - A
|
(3)(5)(6)
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Investment Trust
|
72,320.00
|
49,901
|
37,606
|
0.03
|
||||||
Total Investment Trust
|
|
|
|
49,901
|
37,606
|
0.03
|
||||||
|
|
|
|
|
|
|
||||||
Total Investments
|
|
|
|
$ 105,503,471
|
$ 110,272,358
|
98.84
|
(1) Investments primarily in non-traded public REITs or their successors.
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(2) Under the 1940 Act, the Company generally is deemed to be an “affiliated person” of a portfolio company if it owns between 5% and 25% of the portfolio company’s voting securities. As of
December 31, 2019, the Company is deemed to be “affiliated” with these portfolio companies despite that fact that the Company does not have the power to exercise control over the management or policies of such portfolio companies. See
additional disclosures in Note 5.
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(3) Under the 1940 Act, the Company generally is deemed to “control” a portfolio company if it owns more than 25% of the portfolio company’s voting securities or it has the power to exercise control over the
management or policies of such portfolio company. As of December 31, 2019, the Company is deemed to be in “control” of these portfolio companies despite that fact that the Company does not have the power to exercise control over
the management or policies of such portfolio companies. See additional disclosures in Note 5.
|
(4) Non-qualifying assets under Section 55(a) of the 1940 Act. As of December 31, 2019, the total percentage of non-qualifying assets is 0.81 %, and, as a business development company, non-qualifying assets may not
exceed 30% of our total assets.
|
(5) Investments in illiquid securities, or securities that are not traded on a national exchange. As of December 31, 2019, 94.69% of the Company's total assets are in illiquid securities.
|
(6) Investments in non-income producing securities. As of December 31, 2019, 28.27% of the Company's total assets are in non-income producing securities.
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Name
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Asset Type
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Shares/Units
|
Cost Basis
|
Total
Fair Value |
% of
Net Assets |
||||||
|
|
|
|
|
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|
||||||
American Finance Trust Inc., Class A
|
(4)
|
Publicly Traded Company
|
197,340.00
|
$ 2,186,682
|
$ 2,151,006
|
2.09
|
||||||
Total Publicly Traded Company
|
|
|
|
2,186,682
|
2,151,006
|
2.09
|
||||||
|
|
|
|
|
|
|
||||||
Benefit Street Partners Realty Trust, Inc.
|
(5)
|
Non Traded Company
|
214,175.77
|
3,207,614
|
3,075,563
|
2.96
|
||||||
BRE Select Hotels Corp. - Preferred A
|
(5)
|
Non Traded Company
|
358,717.00
|
594,992
|
670,801
|
0.65
|
||||||
Carter Validus Mission Critical REIT
|
(5)
|
Non Traded Company
|
315,639.56
|
1,087,300
|
1,325,686
|
1.29
|
||||||
Cole Credit Property Trust IV, Inc.
|
(5)
|
Non Traded Company
|
314,451.92
|
1,879,482
|
2,185,441
|
2.12
|
||||||
Cole Credit Property Trust V, Inc.
|
(5)
|
Non Traded Company
|
8,631.50
|
116,442
|
112,123
|
0.11
|
||||||
Cole Credit Property Trust V, Inc. Class T
|
(5)
|
Non Traded Company
|
395.88
|
5,492
|
5,143
|
-
|
||||||
CNL Healthcare Properties, Inc.
|
(5)(6)
|
Non Traded Company
|
104,158.67
|
658,615
|
625,994
|
0.61
|
||||||
Hines Global REIT, Inc.
|
(5)
|
Non Traded Company
|
17,936.21
|
120,637
|
92,013
|
0.09
|
||||||
Corporate Property Associates 18 Global A Inc.
|
(5)
|
Non Traded Company
|
4,695.14
|
39,627
|
37,139
|
0.04
|
||||||
First Capital Real Estate Trust, Inc.
|
(5)(6)
|
Non Traded Company
|
3,792.51
|
15,161
|
18,242
|
0.02
|
||||||
FSP 1441 Main Street
|
(5)(6)
|
Non Traded Company
|
15.73
|
8,559
|
31,245
|
0.03
|
||||||
FSP 303 East Wacker Drive Corp. Liquidating Trust
|
(5)(6)
|
Non Traded Company
|
3.00
|
30
|
600
|
-
|
||||||
FSP Energy Tower I Corp. Liquidating Trust
|
(2)(5)(6)
|
Non Traded Company
|
19.35
|
57,567
|
57,566
|
0.06
|
||||||
FSP Grand Boulevard Liquidating Trust
|
(5)(6)
|
Non Traded Company
|
7.50
|
8
|
8
|
-
|
||||||
FSP Satellite Place
|
(2)(5)(6)
|
Non Traded Company
|
17.60
|
546,482
|
712,585
|
0.69
|
||||||
Griffin-American Healthcare REIT III, Inc.
|
(5)
|
Non Traded Company
|
686.48
|
4,494
|
5,149
|
-
|
||||||
Griffin Capital Essential Asset REIT, Inc.
|
(5)
|
Non Traded Company
|
21,368.03
|
140,003
|
169,021
|
0.16
|
||||||
GTJ REIT, Inc.
|
(5)
|
Non Traded Company
|
1,000.00
|
11,620
|
11,980
|
0.01
|
||||||
Healthcare Trust, Inc.
|
(5)
|
Non Traded Company
|
305,526.76
|
3,473,952
|
3,211,086
|
3.11
|
||||||
Highlands REIT Inc.
|
(5)(6)
|
Non Traded Company
|
21,255,526.80
|
3,965,354
|
3,825,995
|
3.71
|
||||||
Hospitality Investors Trust, Inc.
|
(5)(6)
|
Non Traded Company
|
1,650.75
|
11,802
|
9,327
|
0.01
|
||||||
InvenTrust Properties Corp.
|
(5)
|
Non Traded Company
|
14,799.52
|
22,603
|
26,195
|
0.03
|
||||||
KBS Real Estate Investment Trust II, Inc.
|
(5)
|
Non Traded Company
|
1,364,838.21
|
4,776,934
|
4,831,527
|
4.69
|
||||||
KBS Real Estate Investment Trust III, Inc.
|
(5)
|
Non Traded Company
|
62,516.45
|
515,050
|
593,906
|
0.58
|
||||||
New York City REIT, Inc.
|
(5)(6)
|
Non Traded Company
|
241,297.69
|
3,032,703
|
3,136,870
|
3.04
|
||||||
NorthStar Healthcare Income, Inc.
|
(5)(6)
|
Non Traded Company
|
23,573.29
|
87,643
|
66,477
|
0.06
|
||||||
Phillips Edison & Company, Inc
|
(5)
|
Non Traded Company
|
777,332.00
|
5,760,907
|
6,350,802
|
6.16
|
||||||
Steadfast Apartment REIT
|
(5)
|
Non Traded Company
|
2,083.29
|
17,197
|
26,041
|
0.03
|
||||||
Steadfast Income REIT
|
(5)
|
Non Traded Company
|
109,471.94
|
740,163
|
743,314
|
0.72
|
||||||
Strategic Realty Trust, Inc.
|
(5)
|
Non Traded Company
|
199,425.07
|
792,538
|
853,539
|
0.83
|
||||||
Summit Healthcare REIT, Inc.
|
(2)(5)(6)
|
Non Traded Company
|
1,406,200.22
|
1,922,248
|
2,587,408
|
2.51
|
||||||
The Parking REIT Inc.
|
(5)(6)
|
Non Traded Company
|
17,989.90
|
230,880
|
242,504
|
0.24
|
||||||
Total Non Traded Company (1)
|
|
|
|
33,844,099
|
35,641,290
|
34.56
|
||||||
|
|
|
|
|
|
|
||||||
3100 Airport Way South LP
|
(5)
|
LP Interest
|
1.00
|
355,000
|
387,990
|
0.37
|
||||||
5210 Fountaingate, LP
|
(2)(5)
|
LP Interest
|
9.89
|
500,000
|
552,693
|
0.54
|
||||||
Addison NC, LLC
|
(3)(5)(6)
|
LP Interest
|
200,000.00
|
2,000,000
|
3,600,000
|
3.49
|
||||||
Addison Property Member, LLC
|
(3)(5)
|
LP Interest
|
731,485.60
|
7,316,326
|
7,314,855
|
7.08
|
||||||
Arrowpoint Burlington LLC
|
(2)(5)
|
LP Interest
|
7.50
|
750,000
|
1,088,910
|
1.06
|
||||||
Bishop Berkeley, LLC
|
(3)(5)
|
LP Interest
|
4,050.00
|
4,050,000
|
4,051,013
|
3.93
|
||||||
BP3 Affiliate, LLC
|
(2)(5)(6)
|
LP Interest
|
1,350.00
|
1,350,000
|
1,350,000
|
1.31
|
||||||
BR Cabrillo LLC
|
(5)(6)
|
LP Interest
|
346,723.32
|
104,942
|
131,755
|
0.13
|
||||||
BR Desota Investment Co, LLC
|
(2)(5)
|
LP Interest
|
4,250,000.00
|
4,250,000
|
4,250,000
|
4.12
|
||||||
BR Quinn35 Investment Co, LLC
|
(2)(5)
|
LP Interest
|
4,000,000.00
|
4,000,000
|
4,000,000
|
3.88
|
||||||
Britannia Preferred Members, LLC -Class 1
|
(3)(5)(6)
|
LP Interest
|
103.88
|
2,597,000
|
2,986,550
|
2.90
|
||||||
Britannia Preferred Members, LLC -Class 2
|
(3)(5)(6)
|
LP Interest
|
514,858.30
|
6,826,931
|
7,758,915
|
7.52
|
||||||
Capitol Hill Partners, LLC
|
(3)(5)(6)
|
LP Interest
|
190,000.00
|
1,900,000
|
1,852,500
|
1.80
|
||||||
CRP I Roll Up, LLC
|
(5)
|
LP Interest
|
4,500,000.00
|
4,500,000
|
4,995,000
|
4.84
|
||||||
CRP III Roll Up, LLC
|
(5)
|
LP Interest
|
6,000,000.00
|
6,000,000
|
6,540,000
|
6.34
|
||||||
Dimensions28 LLP
|
(3)(5)(6)
|
LP Interest
|
10,800.00
|
10,801,015
|
10,886,076
|
10.56
|
||||||
Lakemont Partners, LLC
|
(2)(5)
|
LP Interest
|
1,000.00
|
1,000,000
|
1,007,700
|
0.98
|
||||||
MPF Pacific Gateway - Class B
|
(2)(5)(6)
|
LP Interest
|
23.20
|
6,287
|
7,316
|
0.01
|
||||||
Redwood Mortgage Investors VIII
|
(5)
|
LP Interest
|
56,300.04
|
29,700
|
39,410
|
0.04
|
||||||
Satellite Investment Holdings, LLC - Class A
|
(5)
|
LP Interest
|
22.00
|
2,200,000
|
2,200,000
|
2.13
|
||||||
Secured Income, LP
|
(2)(5)(6)
|
LP Interest
|
64,670.00
|
316,890
|
302,009
|
0.29
|
||||||
The Weatherly Building, LLC
|
(5)(6)
|
LP Interest
|
17.50
|
118,721
|
47,846
|
0.05
|
||||||
The Weatherly, LTD
|
(5)(6)
|
LP Interest
|
60.00
|
184,761
|
63,261
|
0.06
|
||||||
Total LP Interest
|
|
|
|
61,157,573
|
65,413,799
|
63.43
|
||||||
|
|
|
|
|
|
|
||||||
Coastal Realty Business Trust, REEP, Inc. - A
|
(3)(5)(6)
|
Investment Trust
|
72,320.00
|
49,901
|
39,053
|
0.04
|
||||||
Total Investment Trust
|
|
|
|
49,901
|
39,053
|
0.04
|
||||||
|
|
|
|
|
|
|
||||||
Total Investments
|
|
|
|
$ 97,238,255
|
$ 103,245,148
|
100.12
|
(1) Investments primarily in non-traded public REITs or their successors.
|
(2) Under the 1940 Act, the Company generally is deemed to be an “affiliated person” of a portfolio company if it owns between 5% and 25% of the portfolio company’s voting securities. As of June
30, 2019, the Company is deemed to be “affiliated” with these portfolio companies despite that fact that the Company does not have the power to exercise control over the management or policies of such portfolio companies. See additional
disclosures in Note 5.
|
(3) Under the 1940 Act, the Company generally is deemed to “control” a portfolio company if it owns more than 25% of the portfolio company’s voting securities or it has the power to exercise
control over the management or policies of such portfolio company. As of June 30, 2019, the Company is deemed to be in “control” of these portfolio companies despite that fact that the Company does not have the power to exercise control over
the management or policies of such portfolio companies. See additional disclosures in Note 5.
|
(4) Non-qualifying assets under Section 55(a) of the 1940 Act. As of June 30, 2019, the total percentage of non-qualifying assets is 1.99%, and as a business development company non-qualifying
assets may not exceed 30% of our total assets.
|
(5) Investments in illiquid securities, or securities that are not traded on a national exchange. As of June 30, 2019, 93.30% of the Company's total assets are in illiquid securities.
|
(6) Investments in non-income producing securities. As of June 30, 2019, 37.23% of the Company's total assets are in non-income producing securities.
|
|
|||||||||||||||
|
Three Months Ended
December 31, |
Six Months Ended
December 31, |
|||||||||||||
|
2019
|
2018
|
2019
|
2018
|
|||||||||||
Investment income
|
|||||||||||||||
Non-controlled/non-affiliated investments:
|
|||||||||||||||
Dividend and operational/sales distributions
|
$
|
1,351,904
|
$
|
1,102,669
|
$
|
2,313,696
|
$
|
6,502,498
|
|||||||
Interest and other income
|
149,594
|
68,310
|
327,979
|
212,188
|
|||||||||||
Affiliated investments:
|
|||||||||||||||
Dividend and operational/sales distributions
|
228,840
|
20,000
|
447,611
|
57,312
|
|||||||||||
Controlled investments:
|
|||||||||||||||
Dividend and operational/sales distributions
|
654,986
|
-
|
1,237,933
|
-
|
|||||||||||
Total investment income
|
2,385,324
|
1,190,979
|
4,327,219
|
6,771,998
|
|||||||||||
|
|||||||||||||||
Operating expenses
|
|||||||||||||||
Base management fee (note 5)
|
630,285
|
541,612
|
1,240,280
|
1,053,791
|
|||||||||||
Portfolio structuring fee (note 5)
|
165,981
|
159,331
|
361,592
|
371,023
|
|||||||||||
Subordinated incentive fee (reversal) (note 5)
|
-
|
(356,181
|
)
|
-
|
1,209,548
|
||||||||||
Administrative cost reimbursements (note 5)
|
170,000
|
156,000
|
340,000
|
312,000
|
|||||||||||
Transfer agent cost reimbursements (note 5)
|
20,000
|
-
|
40,000
|
-
|
|||||||||||
Amortization of deferred offering costs
|
446,516
|
129,623
|
640,208
|
234,802
|
|||||||||||
Professional fees
|
30,919
|
25,953
|
148,521
|
112,028
|
|||||||||||
Directors' fees
|
18,500
|
15,500
|
34,000
|
31,000
|
|||||||||||
Printing and mailing
|
24,590
|
11,407
|
62,040
|
41,498
|
|||||||||||
Other general and administrative
|
19,051
|
32,449
|
34,163
|
59,323
|
|||||||||||
Total operating expenses
|
1,525,842
|
715,694
|
2,900,804
|
3,425,013
|
|||||||||||
|
|||||||||||||||
Net investment income before taxes
|
859,482
|
475,285
|
1,426,415
|
3,346,985
|
|||||||||||
Income tax benefit - (note 2)
|
-
|
(12,968
|
)
|
-
|
(12,968
|
)
|
|||||||||
Net investment income
|
859,482
|
488,253
|
1,426,415
|
3,359,953
|
|||||||||||
|
|||||||||||||||
Realized and unrealized gain (loss) on investments
|
|||||||||||||||
Net realized gain (loss)
|
|||||||||||||||
Non-controlled/non-affiliated investments
|
717,674
|
(1,604,128
|
)
|
826,688
|
2,033,532
|
||||||||||
Affiliated investments:
|
583,331
|
-
|
583,331
|
-
|
|||||||||||
Total net realized gain (loss)
|
1,301,005
|
(1,604,128
|
)
|
1,410,019
|
2,033,532
|
||||||||||
Net unrealized gain (loss)
|
|||||||||||||||
Non-controlled/non-affiliated investments
|
(1,823,089
|
)
|
784,042
|
(2,432,516
|
)
|
(4,141,984
|
)
|
||||||||
Affiliated investments
|
(612,811
|
)
|
88,015
|
(493,991
|
)
|
240,162
|
|||||||||
Controlled investments
|
141,122
|
566,859
|
1,688,503
|
695,082
|
|||||||||||
Total net unrealized gain (loss)
|
(2,294,778
|
)
|
1,438,916
|
(1,238,004
|
)
|
(3,206,740
|
)
|
||||||||
|
|||||||||||||||
Total net realized and unrealized gain (loss) on investments
|
(993,773
|
)
|
(165,212
|
)
|
172,015
|
(1,173,208
|
)
|
||||||||
|
|||||||||||||||
Net increase (decrease) in net assets resulting from operations
|
$
|
(134,291
|
)
|
$
|
323,041
|
$
|
1,598,430
|
$
|
2,186,745
|
||||||
|
|||||||||||||||
Net increase (decrease) in net assets resulting from operations per share
|
$
|
(0.01
|
)
|
$
|
0.03
|
$
|
0.14
|
$
|
0.23
|
||||||
|
|||||||||||||||
Weighted average common shares outstanding
|
12,070,832
|
9,660,553
|
11,731,300
|
9,332,478
|
|
Three Months Ended
|
Six Months Ended
|
||||||||||||||
|
December 31, 2019
|
December 31, 2018
|
December 31, 2019
|
December 31, 2018
|
||||||||||||
Operations
|
||||||||||||||||
Net investment income
|
$
|
859,482
|
$
|
488,253
|
$
|
1,426,415
|
$
|
3,359,953
|
||||||||
Net realized gain (loss)
|
1,301,005
|
(1,604,128
|
)
|
1,410,019
|
2,033,532
|
|||||||||||
Net unrealized gain (loss)
|
(2,294,778
|
)
|
1,438,916
|
(1,238,004
|
)
|
(3,206,740
|
)
|
|||||||||
Net increase (decrease) in net assets resulting from operations
|
(134,291
|
)
|
323,041
|
1,598,430
|
2,186,745
|
|||||||||||
|
||||||||||||||||
Dividends
|
||||||||||||||||
Dividends to stockholders
|
(2,910,017
|
)
|
(1,994,972
|
)
|
(4,080,716
|
)
|
(3,566,523
|
)
|
||||||||
|
||||||||||||||||
Capital share transactions
|
||||||||||||||||
Issuance of common stock
|
5,500,305
|
5,218,691
|
11,966,284
|
12,258,448
|
||||||||||||
Issuance of common stock through reinvestment of dividends
|
813,102
|
697,390
|
1,629,033
|
1,353,191
|
||||||||||||
Redemption of common stock
|
(924,659
|
)
|
(179,504
|
)
|
(1,555,685
|
)
|
(463,635
|
)
|
||||||||
Selling commissions and fees
|
(519,100
|
)
|
(438,764
|
)
|
(1,107,124
|
)
|
(1,122,752
|
)
|
||||||||
Net increase in net assets resulting from capital share transactions
|
4,869,648
|
5,297,813
|
10,932,508
|
12,025,252
|
||||||||||||
|
||||||||||||||||
Total increase in net assets
|
1,825,340
|
3,625,882
|
8,450,222
|
10,645,474
|
||||||||||||
|
||||||||||||||||
Net assets at beginning of the period
|
109,740,263
|
92,614,911
|
103,115,381
|
85,595,319
|
||||||||||||
|
||||||||||||||||
Net assets at end of the period
|
$
|
111,565,603
|
$
|
96,240,793
|
$
|
111,565,603
|
$
|
96,240,793
|
|
||||||||
|
Six Months Ended
December 31, |
|||||||
|
2019
|
2018
|
||||||
Cash flows from operating activities:
|
||||||||
Net increase in net assets resulting from operations
|
$
|
1,598,430
|
$
|
2,186,745
|
||||
Adjustments to reconcile net increase in net assets resulting from
|
||||||||
operations to net cash from operating activities:
|
||||||||
Proceeds from sale of investments, net
|
6,324,865
|
37,407,048
|
||||||
Return of capital
|
12,814,896
|
9,805,754
|
||||||
Purchase of investments
|
(25,994,956
|
)
|
(69,525,249
|
)
|
||||
Net realized gain on investments
|
(1,410,019
|
)
|
(2,033,532
|
)
|
||||
Net unrealized loss on investments
|
1,238,004
|
3,206,740
|
||||||
Amortization of deferred offering costs
|
640,208
|
234,802
|
||||||
Changes in assets and liabilities:
|
||||||||
Accounts receivable
|
1,577,347
|
5,441,108
|
||||||
Other assets
|
(76,965
|
)
|
(6,211
|
)
|
||||
Payment of deferred offering costs
|
(497,374
|
)
|
(400,816
|
)
|
||||
Accounts payable and accrued liabilities
|
(139,296
|
)
|
232,872
|
|||||
Income tax payable
|
-
|
(35,873
|
)
|
|||||
Due to related entities
|
(1,768,932
|
)
|
28,977
|
|||||
Deferred tax liability
|
-
|
(3,518
|
)
|
|||||
Net cash from operating activities
|
(5,693,792
|
)
|
(13,461,153
|
)
|
||||
|
||||||||
Cash flows from financing activities:
|
||||||||
Proceeds from issuance of common stock
|
11,966,284
|
12,258,448
|
||||||
Redemption of common stock
|
(1,555,685
|
)
|
(463,635
|
)
|
||||
Dividends to stockholders
|
(2,231,869
|
)
|
(1,657,167
|
)
|
||||
Payment of selling commissions and fees
|
(1,114,752
|
)
|
(1,135,336
|
)
|
||||
Change in capital pending acceptance
|
355,085
|
460,887
|
||||||
Net cash from financing activities
|
7,419,063
|
9,463,197
|
||||||
|
||||||||
Net increase (decrease) in cash and cash equivalents
|
1,725,271
|
(3,997,956
|
)
|
|||||
|
||||||||
Cash and cash equivalents at beginning of the period
|
1,278,668
|
8,442,249
|
||||||
|
||||||||
Cash and cash equivalents at end of the period
|
$
|
3,003,939
|
$
|
4,444,293
|
||||
|
||||||||
Non-cash financing activities:
|
||||||||
Issuance of common stock through reinvestment of dividends
|
$
|
1,629,033
|
$
|
1,353,191
|
|
December 31, 2019
|
June 30, 2019
|
||||||||||||||
Asset Type
|
Cost
|
Fair Value
|
Cost
|
Fair Value
|
||||||||||||
Publicly Traded Companies
|
$
|
1,707,042
|
$
|
930,600
|
$
|
2,186,682
|
$
|
2,151,006
|
||||||||
Non Traded Companies
|
37,930,266
|
37,690,891
|
33,844,099
|
35,641,290
|
||||||||||||
LP Interests
|
65,816,262
|
71,613,261
|
61,157,573
|
65,413,799
|
||||||||||||
Investment Trust
|
49,901
|
37,606
|
49,901
|
39,053
|
||||||||||||
Total
|
$
|
105,503,471
|
$
|
110,272,358
|
$
|
97,238,255
|
$
|
103,245,148
|
||||||||
|
Asset Type
|
Total
|
Level I
|
Level II
|
Level III
|
||||||||||||
Publicly Traded Company
|
$
|
930,600
|
$
|
930,600
|
$
|
-
|
$
|
-
|
||||||||
Non Traded Companies
|
37,690,891
|
-
|
-
|
37,690,891
|
||||||||||||
LP Interests
|
71,613,261
|
-
|
-
|
71,613,261
|
||||||||||||
Investment Trust
|
37,606
|
-
|
-
|
37,606
|
||||||||||||
Total
|
$
|
110,272,358
|
$
|
930,600
|
$
|
-
|
$
|
109,341,758
|
Asset Type
|
Total
|
Level I
|
Level II
|
Level III
|
||||||||||||
Publicly Traded Companies
|
$
|
2,151,006
|
$
|
2,151,006
|
$
|
-
|
$
|
-
|
||||||||
Non Traded Companies
|
35,641,290
|
-
|
-
|
35,641,290
|
||||||||||||
LP Interests
|
65,413,799
|
-
|
-
|
65,413,799
|
||||||||||||
Investment Trust
|
39,053
|
-
|
-
|
39,053
|
||||||||||||
Total
|
$
|
103,245,148
|
$
|
2,151,006
|
$
|
-
|
$
|
101,094,142
|
||||||||
|
Balance at July 1, 2019
|
$
|
101,094,142
|
||
Purchases of investments
|
24,287,915
|
|||
Proceeds from sales, net
|
(3,510,705
|
)
|
||
Return of capital
|
(12,814,896
|
)
|
||
Net realized gains
|
782,541
|
|||
Net unrealized losses
|
(497,239
|
)
|
||
Ending balance at December 31, 2019
|
$
|
109,341,758
|
||
|
Balance at July 1, 2018
|
$
|
67,923,423
|
||
Purchases of investments
|
40,621,647
|
|||
Transfers to Level I and II
|
(1,991,230
|
)
|
||
Proceeds from sales, net
|
(15,386,999
|
)
|
||
Return of capital
|
(9,805,754
|
)
|
||
Net realized gains
|
2,938,497
|
|||
Net unrealized losses
|
(2,516,685
|
)
|
||
Ending balance at December 31, 2018
|
$
|
81,782,899
|
Asset Type
|
|
Fair Value
|
|
Primary Valuation Techniques
|
|
Unobservable Inputs Used
|
|
Range
|
|
Wt. Average
|
|
|
|
|
|
|
|
|
|
|
|
Non Traded Companies
|
|
$ 813,982
|
|
Direct Capitalization Method
|
|
Capitalization rate
|
|
5.0% - 7.2%
|
|
6.7%
|
|
|
|
|
|
|
Liquidity discount
|
|
23.0% - 50.0%
|
|
32.6%
|
Non Traded Companies
|
|
113,116
|
|
Estimated Liquidation Value
|
|
Sponsor provided value
|
|
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
8.0% - 70.0%
|
|
20.9%
|
Non Traded Companies
|
|
36,763,793
|
|
Market Activity
|
|
Secondary market industry publication
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LP Interests
|
|
26,941,801
|
|
Direct Capitalization Method
|
|
Capitalization rate
|
|
3.3% - 7.3%
|
|
5.0%
|
|
|
|
|
|
|
Liquidity discount
|
|
19.0% - 29.0%
|
|
19.7%
|
LP Interests
|
|
29,976,020
|
|
Discounted Cash Flow
|
|
Discount rate
|
|
9.0% - 30.0%
|
|
17.1%
|
|
|
|
|
|
|
Discount term (months)
|
|
3.0 - 36.0
|
|
16.1
|
LP Interests
|
|
250,178
|
|
Estimated Liquidation Value
|
|
Sponsor provided value
|
|
|
|
|
|
|
|
|
|
|
Underlying property sale contract
|
|
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
19.0% - 34.0%
|
|
33.2%
|
LP Interests
|
|
14,445,262
|
|
Market Activity
|
|
Acquisition Cost
|
|
|
|
|
|
|
|
|
|
|
Book value of underlying loans
|
|
|
|
|
|
|
|
|
|
|
Capital call provision
|
|
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
30.0%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Investment Trust
|
|
37,606
|
|
Direct Capitalization Method
|
|
Capitalization rate
|
|
6.6%
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
24.0%
|
|
|
|
|
$ 109,341,758
|
|
|
|
|
|
|
|
|
Asset Type
|
|
Fair Value
|
|
Primary Valuation Techniques
|
|
Unobservable Inputs Used
|
|
Range
|
|
Wt. Average
|
|
|
|
|
|
|
|
|
|
|
|
Non Traded Companies
|
|
$ 1,010,852
|
|
Direct Capitalization Method
|
|
Capitalization rate
|
|
6.3% - 6.9%
|
|
6.9%
|
|
|
|
|
|
|
Liquidity discount
|
|
19.0% - 34.0%
|
|
20.7%
|
Non Traded Companies
|
|
670,801
|
|
Discounted Cash Flow
|
|
Discount rate
|
|
24.0%
|
|
|
|
|
|
|
|
|
Discount term (months)
|
|
28.0
|
|
|
Non Traded Companies
|
|
107,660
|
|
Estimated Liquidation Value
|
|
Sponsor provided value
|
|
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
12.0% - 70.0%
|
|
23.5%
|
Non Traded Companies
|
|
33,851,977
|
|
Market Activity
|
|
Secondary market industry publication
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LP Interests
|
|
26,798,895
|
|
Direct Capitalization Method
|
|
Capitalization rate
|
|
4.2% - 7.3%
|
|
5.3%
|
|
|
|
|
|
|
Liquidity discount
|
|
19.0% - 25.0%
|
|
19.4%
|
LP Interests
|
|
27,636,406
|
|
Discounted Cash Flow
|
|
Discount rate
|
|
15.0% - 30.0%
|
|
17.8%
|
|
|
|
|
|
|
Discount term (months)
|
|
18.0 - 24.0
|
|
19.4
|
LP Interests
|
|
250,178
|
|
Estimated Liquidation Value
|
|
Sponsor provided value
|
|
|
|
|
|
|
|
|
|
|
Underlying contracted agreement
|
|
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
19.0% - 34.0%
|
|
33.2%
|
LP Interests
|
|
10,728,320
|
|
Market Activity
|
|
Acquisition Cost
|
|
|
|
|
|
|
|
|
|
|
Book value of underlying loans
|
|
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
19.0% - 30.0%
|
|
19.4%
|
|
|
|
|
|
|
|
|
|
|
|
Investment Trust
|
|
39,053
|
|
Direct Capitalization Method
|
|
Capitalization rate
|
|
6.0%
|
|
|
|
|
|
|
|
|
Liquidity discount
|
|
25.0%
|
|
|
|
|
$ 101,094,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Base Management Fee Annual %
|
3.0%
|
|
2.0%
|
|
1.5%
|
|
Total Gross Invested Capital
|
|||||||||
|
||||||||||||||||
For the Year Ended June 30, 2020
|
||||||||||||||||
Quarter ended:
|
||||||||||||||||
September 30, 2019
|
$
|
20,000,000
|
$
|
80,000,000
|
$
|
15,998,789
|
$
|
115,998,789
|
||||||||
December 31, 2019
|
20,000,000
|
80,000,000
|
21,409,289
|
121,409,289
|
||||||||||||
|
||||||||||||||||
For the Year Ended June 30, 2019
|
||||||||||||||||
Quarter ended:
|
||||||||||||||||
September 30, 2018
|
$
|
20,000,000
|
$
|
72,435,844
|
$
|
-
|
$
|
92,435,844
|
||||||||
December 31, 2018
|
20,000,000
|
78,322,307
|
-
|
98,322,307
|
|
Six Months Ended |
Unpaid as of |
||||||||||||||
Types and Recipient |
December 31, 2019 |
December 31, 2018 |
December 31, 2019 |
June 30, 2019 |
||||||||||||
|
||||||||||||||||
Base Management fees- the Adviser |
$ |
1,240,280 |
$ |
1,053,791 |
$ |
630,285 |
$ |
584,737 |
||||||||
Portfolio Structuring fee- the Adviser |
361,592 |
371,023 |
- |
- |
||||||||||||
Subordinated Incentive fee - the Adviser |
- |
1,209,548 |
- |
1,789,870 |
||||||||||||
Administrative Cost Reimbursements- MacKenzie |
340,000 |
312,000 |
- |
- |
||||||||||||
Transfer agent cost reimbursements - MacKenzie |
40,000 |
- |
- |
(30,000 |
)* |
|||||||||||
Organization & Offering Cost (2) - MacKenzie |
269,107 |
271,187 |
63,085 |
116,115 |
||||||||||||
Other expenses (1)- MacKenzie |
3,583 |
5,163 |
||||||||||||||
|
||||||||||||||||
Due to related entities |
$ |
696,953 |
$ |
2,465,885 |
December 31, 2019
|
||||||||||||||||||||||||||||
Name of issuer and title of issue
|
Fair Value at
June 30, 2019 |
Gross Additions
|
Gross Reductions (1)
|
Net Realized Gains (losses)
|
Net Change in Unrealized Gains/(Losses)
|
Fair Value at
December 31, 2019 |
Interest/Dividend/Other income
Six Months Ended December 31, 2019 |
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
Affiliated Investments:
|
||||||||||||||||||||||||||||
5210 Fountaingate, LP
|
$
|
552,693
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(25,858
|
)
|
$
|
526,835
|
$
|
-
|
|||||||||||||
Arrowpoint Burlington LLC
|
1,088,910
|
-
|
(1,333,331
|
)
|
583,331
|
(338,910
|
)
|
-
|
-
|
|||||||||||||||||||
BP3 Affiliate, LLC
|
1,350,000
|
188,000
|
-
|
-
|
-
|
1,538,000
|
-
|
|||||||||||||||||||||
BR Desota Investment Co, LLC
|
4,250,000
|
-
|
(4,250,000
|
)
|
-
|
-
|
-
|
46,623
|
||||||||||||||||||||
BR Everwood Investment Co, LLC
|
-
|
3,750,000
|
-
|
-
|
-
|
3,750,000
|
46,257
|
|||||||||||||||||||||
BR Quinn35 Investment Co, LLC
|
4,000,000
|
-
|
(4,000,000
|
)
|
-
|
-
|
-
|
167,768
|
||||||||||||||||||||
BR Westerly Investment Co, LLC
|
-
|
4,120,667
|
-
|
-
|
-
|
4,120,667
|
178,423
|
|||||||||||||||||||||
FSP Energy Tower I Corp. Liquidating Trust
|
57,566
|
-
|
-
|
-
|
1,355
|
58,921
|
-
|
|||||||||||||||||||||
FSP Satellite Place
|
712,585
|
(494
|
)
|
-
|
-
|
(83,534
|
)
|
628,557
|
-
|
|||||||||||||||||||
Lakemont Partners, LLC
|
1,007,700
|
-
|
-
|
-
|
6,071
|
1,013,771
|
8,540
|
|||||||||||||||||||||
MPF Pacific Gateway - Class B
|
7,316
|
-
|
-
|
-
|
-
|
7,316
|
-
|
|||||||||||||||||||||
Secured Income, LP
|
302,009
|
-
|
-
|
-
|
(11,641
|
)
|
290,368
|
-
|
||||||||||||||||||||
Summit Healthcare REIT, Inc.
|
2,587,408
|
2,254
|
-
|
-
|
(41,474
|
)
|
2,548,188
|
-
|
||||||||||||||||||||
|
||||||||||||||||||||||||||||
|
$
|
15,916,187
|
$
|
8,060,427
|
$
|
(9,583,331
|
)
|
$
|
583,331
|
$
|
(493,991
|
)
|
$
|
14,482,623
|
$
|
447,611
|
||||||||||||
Controlled Investments:
|
||||||||||||||||||||||||||||
Addison NC, LLC
|
3,600,000
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
150,000
|
$
|
3,750,000
|
$
|
-
|
|||||||||||||||
Addison Property Member, LLC
|
7,314,855
|
-
|
-
|
-
|
1,089,914
|
8,404,769
|
627,201
|
|||||||||||||||||||||
Bishop Berkeley, LLC
|
4,051,013
|
-
|
-
|
-
|
428,126
|
4,479,139
|
46,023
|
|||||||||||||||||||||
Britannia Preferred Members, LLC -Class 1
|
2,986,550
|
-
|
-
|
-
|
259,700
|
3,246,250
|
-
|
|||||||||||||||||||||
Britannia Preferred Members, LLC -Class 2
|
7,758,915
|
-
|
-
|
-
|
(756,842
|
)
|
7,002,073
|
-
|
||||||||||||||||||||
Capitol Hill Partners, LLC
|
1,852,500
|
-
|
-
|
-
|
41,800
|
1,894,300
|
-
|
|||||||||||||||||||||
Citrus Park Hotel Holdings, LLC
|
-
|
5,000,000
|
-
|
-
|
-
|
5,000,000
|
60,000
|
|||||||||||||||||||||
Coastal Realty Business Trust, REEP, Inc. - A
|
39,053
|
-
|
-
|
-
|
(1,447
|
)
|
37,606
|
-
|
||||||||||||||||||||
Dimensions28 LLP
|
10,886,076
|
-
|
-
|
-
|
477,252
|
11,363,328
|
238,841
|
|||||||||||||||||||||
Sunlit Holdings, LLC
|
-
|
5,000,000
|
(2,200,000
|
)
|
-
|
-
|
2,800,000
|
265,868
|
||||||||||||||||||||
|
||||||||||||||||||||||||||||
|
$
|
38,488,962
|
$
|
10,000,000
|
$
|
(2,200,000
|
)
|
$
|
-
|
$
|
1,688,503
|
$
|
47,977,465
|
$
|
1,237,933
|
June 30, 2019
|
||||||||||||||||||||||||||||
Name of issuer and title of issue
|
Fair Value at
June 30, 2018 |
Gross Additions
|
Gross Reductions (1)
|
Net Realized Gains (losses)
|
Net Change in Unrealized Gains/(Losses)
|
Fair Value at
June 30, 2019 |
Interest/Dividend/Other income
Year Ended June 30, 2019 |
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
Affiliated Investments:
|
||||||||||||||||||||||||||||
5210 Fountaingate, LP
|
$
|
555,728
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
(3,035
|
)
|
$
|
552,693
|
$
|
18,124
|
|||||||||||||
Arrowpoint Burlington LLC
|
869,072
|
-
|
-
|
-
|
219,838
|
1,088,910
|
83,333
|
|||||||||||||||||||||
BP3 Affliliate, LLC
|
-
|
1,350,000
|
-
|
-
|
-
|
1,350,000
|
-
|
|||||||||||||||||||||
BR Desota Investment Co, LLC
|
-
|
4,250,000
|
-
|
-
|
-
|
4,250,000
|
205,560
|
|||||||||||||||||||||
BR Quinn35 Investment Co, LLC
|
-
|
4,000,000
|
-
|
-
|
-
|
4,000,000
|
69,056
|
|||||||||||||||||||||
FSP Energy Tower I Corp. Liquidating Trust
|
301,373
|
415,374
|
(661,307
|
)
|
-
|
2,126
|
57,566
|
1,080,192
|
||||||||||||||||||||
FSP Satellite Place
|
499,140
|
151,169
|
-
|
-
|
62,276
|
712,585
|
-
|
|||||||||||||||||||||
Lakemont Partners, LLC
|
-
|
1,000,000
|
-
|
-
|
7,700
|
1,007,700
|
4,381
|
|||||||||||||||||||||
MPF Pacific Gateway - Class B
|
6,613
|
-
|
-
|
-
|
703
|
7,316
|
-
|
|||||||||||||||||||||
Secured Income, LP
|
320,763
|
-
|
-
|
-
|
(18,754
|
)
|
302,009
|
-
|
||||||||||||||||||||
Summit Healthcare REIT, Inc.
|
2,043,379
|
193,066
|
-
|
-
|
350,963
|
2,587,408
|
88,683
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
|
$
|
4,596,068
|
$
|
11,359,609
|
$
|
(661,307
|
)
|
$
|
-
|
$
|
621,817
|
$
|
15,916,187
|
$
|
1,549,329
|
|||||||||||||
Controlled Investments:
|
||||||||||||||||||||||||||||
Addison NC, LLC
|
$
|
3,000,000
|
$
|
-
|
$
|
-
|
$
|
-
|
$
|
600,000
|
$
|
3,600,000
|
$
|
-
|
||||||||||||||
Addison Property Member, LLC
|
-
|
7,316,326
|
-
|
-
|
(1,471
|
)
|
7,314,855
|
598,191
|
||||||||||||||||||||
Bandon PV Holdings, LLC
|
-
|
5,250,000
|
(5,256,262
|
)
|
6,262
|
-
|
-
|
173,390
|
||||||||||||||||||||
Bishop Berkeley, LLC
|
-
|
4,050,000
|
-
|
-
|
1,013
|
4,051,013
|
23,011
|
|||||||||||||||||||||
BR Gate Investment Co, LLC
|
-
|
3,475,000
|
(3,475,000
|
)
|
-
|
-
|
-
|
-
|
||||||||||||||||||||
Britannia Preferred Members, LLC -Class 1
|
-
|
2,597,000
|
-
|
-
|
389,550
|
2,986,550
|
-
|
|||||||||||||||||||||
Britannia Preferred Members, LLC -Class 2
|
2,547,000
|
5,326,932
|
-
|
-
|
(115,017
|
)
|
7,758,915
|
-
|
||||||||||||||||||||
Capitol Hill Partners, LLC
|
1,919,000
|
-
|
-
|
-
|
(66,500
|
)
|
1,852,500
|
-
|
||||||||||||||||||||
Coastal Realty Business Trust, REEP, Inc. - A
|
41,222
|
-
|
-
|
-
|
(2,169
|
)
|
39,053
|
-
|
||||||||||||||||||||
Dimensions28 LLP
|
-
|
10,801,015
|
-
|
-
|
85,061
|
10,886,076
|
165,600
|
|||||||||||||||||||||
|
||||||||||||||||||||||||||||
|
$
|
7,507,222
|
$
|
38,816,273
|
$
|
(8,731,262
|
)
|
$
|
6,262
|
$
|
890,467
|
$
|
38,488,962
|
$
|
960,192
|
(1)
|
Gross reductions include decreases in the cost basis of investments resulting from return of capital distributions.
|
· |
CRBT, REEP, Inc.-A, which has an ownership interest in one of three general partners of a limited partnership which owns one multi-family property located in Frederick, Maryland.
|
|
For The Six Months Ended
|
For The Year Ended
|
||||||
|
December 31, 2019
|
June 30, 2019
|
||||||
Per Share Data:
|
(Unaudited)
|
|||||||
|
||||||||
Beginning net asset value ("NAV")
|
$
|
9.44
|
$
|
10.07
|
||||
|
||||||||
Net investment income (1)
|
0.12
|
0.57
|
||||||
Net realized gain (1)
|
0.12
|
0.12
|
||||||
Net unrealized loss (1)
|
(0.10
|
)
|
(0.40
|
)
|
||||
Net increase in net assets resulting from operations
|
0.14
|
0.29
|
||||||
|
||||||||
Issuance of common stock above (below) NAV (1) (4)
|
(0.05
|
)
|
(0.21
|
)
|
||||
Redemption of common stock below NAV (1) (6)
|
0.01
|
0.02
|
||||||
Dividends to stockholders (1) (5)
|
(0.35
|
)
|
(0.73
|
)
|
||||
Ending NAV
|
$
|
9.19
|
$
|
9.44
|
||||
|
||||||||
Weighted average common Shares outstanding
|
11,731,300
|
9,951,816
|
||||||
Shares outstanding at the end of period
|
12,138,738
|
10,926,320
|
||||||
Net assets at the end of period
|
$
|
111,565,603
|
$
|
103,115,381
|
||||
Average net assets (2)
|
$
|
107,340,492
|
$
|
94,355,350
|
||||
|
||||||||
Ratios to average net assets
|
||||||||
Total expenses (7)
|
2.70
|
%
|
6.62
|
%
|
||||
Net investment income (7)
|
1.33
|
%
|
5.98
|
%
|
||||
Total rate of return (2) (3) (7)
|
1.49
|
%
|
3.06
|
%
|
(1) Based on weighted average number of shares of common stock outstanding for the period.
|
|
||||
(2) Average net assets were derived from the beginning and ending period-end net assets.
|
|
|
|||
(3) Total rate of return is based on net increases (decreases) in net assets resulting from operations. An individual stockholder’s return may vary from this return based on the time of capital transactions.
|
|||||
(4) Net of sales commissions and dealer manager fees of $1.00 per share.
|
|
|
|
|
|
(5) Dividends are determined based on taxable income calculated in accordance with income tax regulations which may differ from amounts determined under GAAP.
|
|||||
(6) Amounts based on differences between the actual redemption price and the NAVs preceding the redemptions.
|
|||||
(7) Not annualized for interim reporting periods.
|
|
|
|
|
|
Dividends
|
|||||||
During the Quarter Ended
|
Per Share
|
Amount
|
||||||
September 30, 2019
|
$
|
0.175
|
$
|
1,983,801
|
||||
December 31, 2019
|
0.175
|
2,096,915
|
||||||
|
||||||||
|
$
|
0.350
|
$
|
4,080,716
|
|
Dividends
|
|||||||
During the Quarter Ended
|
Per Share
|
Amount
|
||||||
September 30, 2018
|
$
|
0.175
|
$
|
1,571,551
|
||||
December 31, 2018
|
0.206
|
1,994,972
|
||||||
|
||||||||
|
$
|
0.381
|
$
|
3,566,523
|
|
December 31, 2018
|
|||
Capital gain
|
$
|
6,236,421
|
||
|
||||
Total dividends
|
$
|
6,236,421
|
|
December 31, 2018
|
|||
Undistributed long term capital gain
|
$
|
129,808
|
||
Unrealized fair value appreciation
|
6,802,996
|
|||
|
$
|
6,932,804
|
|
December 31, 2019
|
June 30, 2019
|
||||||
Aggregate gross unrealized appreciation
|
$
|
10,160,876
|
$
|
9,058,278
|
||||
Aggregate gross unrealized depreciation
|
(3,184,704
|
)
|
(827,940
|
)
|
||||
Net unrealized appreciation
|
$
|
6,976,172
|
$
|
8,230,338
|
||||
|
||||||||
Aggregate cost (tax basis)
|
$
|
103,296,186
|
$
|
95,014,809
|
· |
the cost of calculating our NAV;
|
· |
the cost of effecting sales and repurchases of our shares and other securities;
|
· |
interest payable on debt, if any, to finance our investments;
|
· |
fees payable to third parties relating to, or associated with, making investments, including fees and expenses associated with performing due diligence reviews of prospective investments and third-party advisory fees;
|
· |
transfer agent and safekeeping fees;
|
· |
fees and expenses associated with marketing efforts;
|
· |
federal and state registration fees, and any stock exchange listing fees in the future;
|
· |
federal, state, and local taxes, if any;
|
· |
Independent Directors' fees and expenses;
|
· |
brokerage commissions;
|
· |
fidelity bond, directors and officers errors and omissions liability insurance, and other insurance premiums;
|
· |
direct costs and expenses of administration, including printing, mailing, and staff;
|
· |
fees and expenses associated with independent audits and outside legal costs;
|
· |
costs associated with our reporting and compliance obligations under the 1934 Act, the 1940 Act, and applicable federal and state securities laws; and
|
· |
all other expenses incurred by either MacKenzie or us in connection with administering our business, including payments under the Administration Agreement that will be based upon our allocable portion of overhead and other expenses
incurred by MacKenzie in performing its obligations under the Administration Agreement, including rent, the fees and expenses associated with performing compliance functions, and our allocable portion of the costs of compensation and
related expenses of our Chief Compliance Officer, our Chief Financial Officer, Director of Accounting and Financial Reporting, General Counsel, and any administrative support staff.
|
|
December 31, 2019 |
June 30, 2019 |
||||||||||||||
Asset Type |
Cost |
Fair Value |
Cost |
Fair Value |
||||||||||||
Publicly Traded Companies |
$ |
1,707,042 |
$ |
930,600 |
$ |
2,186,682 |
$ |
2,151,006 |
||||||||
Non Traded Companies |
37,930,266 |
37,690,891 |
33,844,099 |
35,641,290 |
||||||||||||
LP Interests |
65,816,262 |
71,613,261 |
61,157,573 |
65,413,799 |
||||||||||||
Investment Trust |
49,901 |
37,606 |
49,901 |
39,053 |
||||||||||||
Total |
$ |
105,503,471 |
$ |
110,272,358 |
$ |
97,238,255 |
$ |
103,245,148 |
Period
|
Total Number of Shares Purchased
|
Average Price Paid Per Share
|
Total Number of Shares Purchased as Part of Publicly Announced Plans
|
Maximum Dollar Value of Shares That May Yet Be Purchased Under Publicly Announced Plans
|
||||||||||||
|
||||||||||||||||
During the year ended June 30, 2020:
|
||||||||||||||||
August 13, 2019 through September 16, 2019
|
70,114.03
|
$
|
9.00
|
70,114.03
|
-
|
|||||||||||
November 18, 2019 through December 19, 2019
|
102,739.90
|
$
|
9.00
|
102,739.90
|
-
|
|||||||||||
|
||||||||||||||||
|
172,853.93
|
$
|
9.00
|
172,853.93
|
Exhibit
|
Description
|
|
|
|
|
|
|
MACKENZIE REALTY CAPITAL, INC.
|
||
|
|
|
|
|
|
Date: February 12, 2020
|
|
By: /s/ Robert Dixon
|
|
|
President and Chief Executive Officer
|
|
|
|
Date: February 12, 2020
|
|
By: /s/ Paul Koslosky
|
|
|
Treasurer and Chief Financial Officer
|