Company Quick10K Filing
Strategic Realty Trust
Price-0.00 EPS-0
Shares11 P/E0
MCap-0 P/FCF-0
Net Debt38 EBIT-1
TEV38 TEV/EBIT-55
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-03-31 Filed 2020-05-08
10-K 2019-12-31 Filed 2020-03-18
10-Q 2019-09-30 Filed 2019-11-08
10-Q 2019-06-30 Filed 2019-08-09
10-Q 2019-03-31 Filed 2019-05-10
10-K 2018-12-31 Filed 2019-03-19
10-Q 2018-09-30 Filed 2018-11-09
10-Q 2018-06-30 Filed 2018-08-10
10-Q 2018-03-31 Filed 2018-05-11
10-K 2017-12-31 Filed 2018-03-23
10-Q 2017-09-30 Filed 2017-11-13
10-Q 2017-06-30 Filed 2017-08-10
10-Q 2017-03-31 Filed 2017-05-11
10-K 2016-12-31 Filed 2017-03-24
10-Q 2016-09-30 Filed 2016-11-09
10-Q 2016-06-30 Filed 2016-08-12
10-Q 2016-03-31 Filed 2016-05-13
10-K 2015-12-31 Filed 2016-03-30
10-Q 2015-09-30 Filed 2015-11-13
10-Q 2015-06-30 Filed 2015-08-12
10-Q 2015-03-31 Filed 2015-05-14
10-K 2014-12-31 Filed 2015-03-27
10-Q 2014-09-30 Filed 2014-11-14
10-Q 2014-06-30 Filed 2014-08-12
10-Q 2014-03-31 Filed 2014-05-12
10-K 2013-12-31 Filed 2014-03-31
10-Q 2013-09-30 Filed 2013-11-14
10-Q 2013-06-30 Filed 2013-08-14
10-Q 2013-03-31 Filed 2013-05-20
10-K 2012-12-31 Filed 2013-04-01
10-Q 2012-09-30 Filed 2012-11-14
10-Q 2012-06-30 Filed 2012-08-14
10-Q 2012-03-31 Filed 2012-05-15
10-K 2011-12-31 Filed 2012-03-30
10-Q 2011-09-30 Filed 2011-11-14
10-Q 2011-06-30 Filed 2011-08-15
10-Q 2011-03-31 Filed 2011-05-16
10-K 2010-12-31 Filed 2011-04-01
10-Q 2010-09-30 Filed 2010-11-15
10-Q 2010-06-30 Filed 2010-08-16
10-Q 2010-03-31 Filed 2010-05-17
10-K 2009-12-31 Filed 2010-03-31
8-K 2020-04-21 Regulation FD, Other Events, Exhibits
8-K 2020-03-27 Other Events, Exhibits
8-K 2020-02-10 M&A
8-K 2020-01-22 Regulation FD, Other Events, Exhibits
8-K 2019-12-05 Enter Agreement
8-K 2019-08-23 Regulation FD, Other Events, Exhibits
8-K 2019-08-08 Other Events
8-K 2019-08-01 Enter Agreement, Exhibits
8-K 2019-06-20 Shareholder Vote
8-K 2019-05-07 Enter Agreement, Other Events
8-K 2019-04-23 Other Events, Exhibits
8-K 2019-04-16 Regulation FD, Exhibits
8-K 2019-04-16 Officers
8-K 2019-03-14 Other Events
8-K 2018-12-20 M&A
8-K 2018-11-19 Regulation FD, Exhibits
8-K 2018-11-08 Other Events
8-K 2018-10-29 Enter Agreement
8-K 2018-09-20 Enter Agreement
8-K 2018-09-06 Enter Agreement
8-K 2018-08-20 Regulation FD, Other Events, Exhibits
8-K 2018-08-09 Other Events
8-K 2018-08-02 Enter Agreement, Exhibits
8-K 2018-07-19 Enter Agreement, Exhibits
8-K 2018-06-20 Shareholder Vote
8-K 2018-05-30 Regulation FD, Exhibits
8-K 2018-05-10 Other Events
8-K 2018-04-27 Enter Agreement
8-K 2018-04-20 Enter Agreement
8-K 2018-03-30 Regulation FD, Exhibits
8-K 2018-03-21 Other Events
8-K 2018-03-01 Leave Agreement
8-K 2018-01-24 Enter Agreement
8-K 2017-12-07 Other Events

SRTR 10Q Quarterly Report

Part I
Item 1. Unaudited Condensed Consolidated Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures
Part II
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 3. Defaults Upon Senior Securities
Item 4. Mine Safety Disclosures
Item 5. Other Information
Item 6. Exhibits
EX-31.1 exhibit311-3312020.htm
EX-31.2 exhibit312-3312020.htm
EX-32.1 exhibit321-3312020.htm
EX-32.2 exhibit322-3312020.htm

Strategic Realty Trust Earnings 2020-03-31

Balance SheetIncome StatementCash Flow
3052441831226102012201420172020
Assets, Equity
4.51.6-1.3-4.2-7.1-10.02012201220132014
Rev, G Profit, Net Income
553311-11-33-552012201420172020
Ops, Inv, Fin

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________________________
FORM 10-Q
_________________________________
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 2020
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from              to             
Commission file number 000-54376
_________________________________
STRATEGIC REALTY TRUST, INC.
(Exact name of registrant as specified in its charter)
_________________________________
Maryland
 
 
90-0413866
(State or Other Jurisdiction of
Incorporation or Organization)
 
 
(I.R.S. Employer Identification No.)
 
 
 
 
 
P.O. Box 5049
 
 
 
San Mateo,
California
 
 
94402
(Address of Principal Executive Offices)
 
 
(Zip Code)
(650) 343-9300
(Registrant’s Telephone Number, Including Area Code)
_________________________________
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: (1) has 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   ý     No  
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of 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   ý     No  
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.
Large accelerated filer
Accelerated filer
 
 
 
 
Non-accelerated filer
ý
Smaller reporting company
 
 
 
 
 
 
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. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes       No   ý
As of May 6, 2020, there were 10,739,814 shares of the registrant’s common stock issued and outstanding.




STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
TABLE OF CONTENTS
 
Page
 
 
 
 
Item 1.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Item 2.
 
 
 
Item 3.
 
 
 
Item 4.
 
 
 
 
 
 
Item 1.
 
 
 
Item 1A.
 
 
 
Item 2.
 
 
 
Item 3.
 
 
 
Item 4.
 
 
 
Item 5.
 
 
 
Item 6.
 
 
 
 



PART I
FINANCIAL INFORMATION
The accompanying interim unaudited condensed consolidated financial statements as of and for the three months ended March 31, 2020, have been prepared by Strategic Realty Trust, Inc. (the “Company”) pursuant to the rules and regulations of the Securities and Exchange Commission (the “SEC”) regarding interim financial reporting. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States of America for complete financial statements and should be read in conjunction with the audited consolidated financial statements and related notes thereto included in the Company’s Annual Report on Form 10-K as of and for the year ended December 31, 2019, as filed with the SEC on March 18, 2020 (the “2019 Annual Report on Form 10-K”). The interim unaudited condensed consolidated financial statements herein should also be read in conjunction with the Notes to Condensed Consolidated Financial Statements and Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this Quarterly Report on Form 10-Q. The results of operations for the three months ended March 31, 2020, are not necessarily indicative of the operating results expected for the full year. The information furnished in the Company’s accompanying unaudited condensed consolidated balance sheets and unaudited condensed consolidated statements of operations, equity, and cash flows reflects all adjustments that, in management’s opinion, are necessary for a fair presentation of the aforementioned financial statements. Such adjustments are of a normal recurring nature.

3


ITEM 1. UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except shares and per share amounts)
(unaudited)
 
March 31,
 
December 31,
 
2020
 
2019
ASSETS
 
 
 
Investments in real estate
 
 
 
Land
$
13,791

 
$
13,536

Building and improvements
23,732

 
23,732

Tenant improvements
1,418

 
1,264

 
38,941

 
38,532

Accumulated depreciation
(3,548
)
 
(3,308
)
Investments in real estate, net
35,393

 
35,224

Properties under development and development costs
 
 
 
Land
25,851

 
25,851

Buildings
550

 
554

Development costs
23,037

 
20,813

Properties under development and development costs
49,438

 
47,218

Cash, cash equivalents and restricted cash
6,306

 
7,241

Prepaid expenses and other assets, net
242

 
114

Tenant receivables, net of $128 and $14 bad debt reserve
697

 
727

Lease intangibles, net
1,347

 
1,321

Assets held for sale

 
9,216

Deferred financing costs, net

 
105

TOTAL ASSETS (1)
$
93,423

 
$
101,166

LIABILITIES AND EQUITY
 
 
 
LIABILITIES
 
 
 
Notes payable, net
$
35,649

 
$
33,927

Accounts payable and accrued expenses
1,686

 
2,404

Amounts due to affiliates
71

 
140

Other liabilities
148

 
180

Liabilities related to assets held for sale

 
8,939

Below-market lease liabilities, net
281

 
296

TOTAL LIABILITIES (1)
37,835

 
45,886

Commitments and contingencies (Note 12)


 


EQUITY
 
 
 
Stockholders’ equity
 
 
 
Preferred stock, $0.01 par value; 50,000,000 shares authorized, none issued and outstanding

 

Common stock, $0.01 par value; 400,000,000 shares authorized; 10,739,814 and 10,759,721 shares issued and outstanding at March 31, 2020 and December 31, 2019, respectively
110

 
110

Additional paid-in capital
94,602

 
94,719

Accumulated deficit
(40,154
)
 
(40,571
)
Total stockholders’ equity
54,558

 
54,258

Non-controlling interests
1,030

 
1,022

TOTAL EQUITY
55,588

 
55,280

TOTAL LIABILITIES AND EQUITY
$
93,423

 
$
101,166

(1)
As of March 31, 2020 and December 31, 2019, includes approximately $50.2 million and $49.4 million, respectively, of assets related to consolidated variable interest entities that can be used only to settle obligations of the consolidated variable interest entities and approximately $19.9 million and $18.5 million, respectively, of liabilities of consolidated variable interest entities for which creditors do not have recourse to the general credit of the Company. Refer to Note 4. “Variable Interest Entities”.
See accompanying notes to condensed consolidated financial statements.

4


STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except shares and per share amounts)
(unaudited)
 
Three Months Ended
March 31,
 
2020
 
2019
Revenue:
 
 
 
Rental and reimbursements
$
807

 
$
944

 
 
 
 
Expense:
 
 
 
Operating and maintenance
450


270

General and administrative
405


399

Depreciation and amortization
301


377

Interest expense
171


189

 
1,327

 
1,235

Operating loss
(520
)
 
(291
)
 
 
 
 
Other income (loss):
 
 
 
Equity in loss of unconsolidated joint ventures

 
(20
)
Net gain on disposal of real estate
947

 

Income (loss) before income taxes
427

 
(311
)
Income taxes
(2
)
 

Net income (loss)
425

 
(311
)
Net income (loss) attributable to non-controlling interests
8

 
(7)
Net income (loss) attributable to common stockholders
$
417

 
$
(304
)
 
 
 
 
Earnings (loss) per common share - basic and diluted
$
0.04

 
$
(0.03
)
 
 
 
 
Weighted average shares outstanding used to calculate earnings (loss) per common share - basic and diluted
10,759,198

 
10,862,806

See accompanying notes to condensed consolidated financial statements.

5


STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF EQUITY
(in thousands, except shares)
(unaudited)
 
Number of
Shares
 
Par Value
 
Additional
Paid-in Capital
 
Accumulated
Deficit
 
Total
Stockholders’
Equity
 
Non-controlling
Interests
 
Total
Equity
BALANCE — December 31, 2019
10,759,721

 
$
110

 
$
94,719

 
$
(40,571
)
 
$
54,258

 
$
1,022

 
$
55,280

Redemption of common shares
(19,907
)
 

 
(117
)
 

 
(117
)
 

 
(117
)
Net income

 

 

 
417

 
417

 
8

 
425

BALANCE — March 31, 2020
10,739,814

 
$
110

 
$
94,602

 
$
(40,154
)
 
$
54,558

 
$
1,030

 
$
55,588

 
 
 
 
 
 
 
 
 
 
 
 
 
 
BALANCE — December 31, 2018
10,863,299

 
$
110

 
$
95,336

 
$
(38,546
)
 
$
56,900

 
$
1,170

 
$
58,070

Redemption of common shares
(20,855
)
 

 
(126
)
 

 
(126
)
 

 
(126
)
Quarterly distributions

 

 

 
(651
)
 
(651
)
 
(14
)
 
(665
)
Net loss

 

 

 
(304
)
 
(304
)
 
(7
)
 
(311
)
BALANCE — March 31, 2019
10,842,444

 
$
110

 
$
95,210

 
$
(39,501
)
 
$
55,819

 
$
1,149

 
$
56,968

See accompanying notes to condensed consolidated financial statements.

6


STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
(unaudited)
 
Three Months Ended March 31,
 
2020
 
2019
Cash flows from operating activities:
 
 
 
Net income (loss)
$
425

 
$
(311
)
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
 
 
 
Net gain on disposal of real estate
(947
)
 

Equity in loss of unconsolidated joint ventures

 
20

Straight-line rent
(14
)
 
(27
)
Amortization of deferred costs
171

 
158

Depreciation and amortization
301

 
377

Amortization of above and below-market leases
(13
)
 
(5
)
Provision for losses on tenant receivable
168

 

Changes in operating assets and liabilities:
 
 
 
Prepaid expenses and other assets
(128
)
 
32

Tenant receivables
(119
)
 
(11
)
Accounts payable and accrued expenses
(153
)
 
(22
)
Amounts due to affiliates
(69
)
 
(18
)
Other liabilities
(32
)
 
(117
)
Net cash provided by (used in) operating activities
(410
)
 
76

 
 
 
 
Cash flows from investing activities:
 
 
 
Proceeds from the sale of real estate
9,920

 

Investment in properties under development and development costs
(2,485
)
 
(724
)
Improvements, capital expenditures, and leasing costs
(279
)
 
(53
)
Investments in unconsolidated joint ventures

 
(38
)
Net cash provided by (used in) investing activities
7,156

 
(815
)
 
 
 
 
Cash flows from financing activities:
 
 
 
Redemption of common shares
(117
)
 
(126
)
Quarterly distributions
(220
)
 
(666
)
Proceeds from notes payable
1,590

 
1,500

Repayment of notes payable
(8,927
)
 

Payment of loan fees from investments in consolidated variable interest entities

 
(62
)
Payment of loan fees and financing costs
(7
)
 

Net cash provided by (used in) financing activities
(7,681
)
 
646

 
 
 
 
Net decrease in cash, cash equivalents and restricted cash
(935
)
 
(93
)
Cash, cash equivalents and restricted cash – beginning of period
7,241

 
3,347

Cash, cash equivalents and restricted cash – end of period
$
6,306

 
$
3,254

 
 
 
 
Supplemental disclosure of non-cash investing and financing activities and other cash flow information:
 
 
 
Distributions declared but not paid
$

 
$
665

Change in accrued liabilities capitalized to investment in development
(353
)
 
109

Change to accrued mortgage note payable interest capitalized to investment in development
15

 

Amortization of deferred loan fees capitalized to investment in development
73

 
89

Changes in capital improvements, accrued but not paid
(7
)
 

Cash paid for interest, net of amounts capitalized
13

 
57

See accompanying notes to condensed consolidated financial statements.

7


STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(unaudited)
1. ORGANIZATION AND BUSINESS
Strategic Realty Trust, Inc. (the “Company”) was formed on September 18, 2008, as a Maryland corporation. Effective August 22, 2013, the Company changed its name from TNP Strategic Retail Trust, Inc. to Strategic Realty Trust, Inc. The Company believes it qualifies as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Internal Revenue Code”), and has elected REIT status beginning with the taxable year ended December 31, 2009, the year in which the Company began material operations.
Since the Company’s inception, its business has been managed by an external advisor. The Company has no direct employees and all management and administrative personnel responsible for conducting the Company’s business are employed by its advisor. Currently, the Company is externally managed and advised by SRT Advisor, LLC, a Delaware limited liability company (the “Advisor”) pursuant to an advisory agreement with the Advisor (the “Advisory Agreement”) initially executed on August 10, 2013, and subsequently renewed every year through 2019. The current term of the Advisory Agreement terminates on August 9, 2020. The Advisor is an affiliate of Glenborough, LLC (together with its affiliates, “Glenborough”), a privately held full-service real estate investment and management company focused on the acquisition, management and leasing of commercial properties.
Substantially all of the Company’s business is conducted through Strategic Realty Operating Partnership, L.P. (the “OP”). During the Company’s initial public offering (“Offering”), as the Company accepted subscriptions for shares of its common stock, it transferred substantially all of the net proceeds of the Offering to the OP as a capital contribution. The Company is the sole general partner of the OP. As of March 31, 2020 and December 31, 2019, the Company owned 98.0% and 98.0%, respectively, of the limited partnership interests in the OP.
The Company’s principal demand for funds has been for the acquisition of real estate assets, the payment of operating expenses, interest on outstanding indebtedness, the payment of distributions to stockholders, and investments in development of properties. Substantially all of the proceeds of the completed Offering have been used to fund investments in real properties and other real estate-related assets, for payment of operating expenses, for payment of interest, for payment of various fees and expenses, such as acquisition fees and management fees, and for payment of distributions to stockholders. The Company’s available capital resources, cash and cash equivalents on hand and sources of liquidity are currently limited. The Company expects its future cash needs will be funded using cash from operations, future asset sales, debt financing and the proceeds to the Company from any sale of equity that it may conduct in the future.
The Company invests in and manages a portfolio of income-producing retail properties, located in the United States, real estate-owning entities and real estate-related assets. The Company has invested directly, and indirectly through joint ventures, in a portfolio of income-producing retail properties located throughout the United States, with a focus on grocery anchored multi-tenant retail centers, including neighborhood, community and lifestyle shopping centers, multi-tenant shopping centers and free standing single-tenant retail properties. During the first quarter of 2016, the Company invested, through joint ventures, in two significant retail projects under development.
As of March 31, 2020, in addition to the development projects, the Company’s portfolio of properties was comprised of 7 properties with approximately 43,000 rentable square feet of retail space located in two states, as well as an improved land parcel. As of March 31, 2020, the rentable space at the Company’s retail properties was 81% leased.
COVID-19 Pandemic
Currently, one of the most significant risks and uncertainties facing the Company, the retail industry, the real estate industry and the economy generally is the potential adverse effect of the ongoing public health crisis of the novel coronavirus disease (COVID-19) pandemic. The full extent to which the COVID-19 pandemic impacts the Company’s operations and those of its tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. Refer to Note 13 for additional information.

8

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Principles of Consolidation and Basis of Presentation
The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with U.S. generally accepted accounting principles (“GAAP”) as contained within the Financial Accounting Standards Board’s (“FASB”) Accounting Standards Codification (“ASC”) and the rules and regulations of the Securities and Exchange Commission (the “SEC”), including the instructions to Form 10-K and Regulation S-X.
The interim unaudited condensed consolidated financial statements include the accounts of the Company, the OP, their direct and indirect owned subsidiaries, and the accounts of joint ventures that are determined to be variable interest entities for which the Company is the primary beneficiary. All significant intercompany balances and transactions are eliminated in consolidation. In the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary to present fairly the Company’s condensed consolidated financial position, results of operations and cash flows have been included.
The Company evaluates the need to consolidate joint ventures and variable interest entities based on standards set forth in ASC Topic 810, Consolidation (“ASC 810”). In determining whether the Company has a controlling interest in a joint venture or a variable interest entity and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the partners/members, as well as whether the entity is a variable interest entity for which the Company is the primary beneficiary. As of March 31, 2020 and December 31, 2019, the Company held variable interests in two variable interest entities and consolidated those entities. Refer to Note 4. “Variable Interest Entities” for additional information.
Cash, Cash Equivalents and Restricted Cash
Cash and cash equivalents represent current bank accounts and other bank deposits free of encumbrances and having maturity dates of three months or less from the respective dates of deposit. The Company limits cash investments to financial institutions with high credit standing; therefore, the Company believes it is not exposed to any significant credit risk in cash.
Restricted cash includes escrow accounts for real property taxes, insurance, capital expenditures and tenant improvements, debt service and leasing costs held by lenders.
The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported on the condensed consolidated balance sheets that sum to the total of the same such amounts shown on the condensed consolidated statement of cash flows (amounts in thousands):
 
March 31, 2020
 
December 31, 2019
Cash and cash equivalents
$
5,361

 
$
6,119

Restricted cash
945

 
1,122

Total cash, cash equivalents, and restricted cash
$
6,306

 
$
7,241


Recent Accounting Pronouncements
The FASB issued the following ASUs, which could have potential impact to the Company’s condensed consolidated financial statements:
In August 2018, the FASB issued ASU No. 2018-13, Fair Value Measurement (Topic 820) Disclosure Framework-Changes to the Disclosure Requirements for Fair Value Measurement (“ASU 2018-13”). ASU 2018-13 modifies the disclosure requirements on fair value measurements in Topic 820. ASU 2018-13 is effective for fiscal years beginning after December 15, 2019. Early adoption is permitted for any removed or modified disclosures upon issuance of ASU 2018-13 and delayed adoption of the additional disclosures until the effective date. The Company adopted ASU 2018-13 effective January 1, 2020. The adoption of ASU 2018-13 did not have an impact on the Company’s condensed consolidated financial statements.
In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments – Credit Losses (“ASU 2016-13”). ASU 2016-13 requires a financial asset, measured at amortized cost basis to be presented at the net amount expected to be collected. ASU 2016-13 was effective for fiscal years beginning after December 15, 2019, with adoption permitted for fiscal years beginning after December 15, 2018. Adjustments resulting from adopting ASU 2016-13 shall be applied through a cumulative-effect adjustment to retained earnings. In November 2019, the FASB issued ASU No. 2019-10, Financial Instruments—Credit Losses (Topic 326), Derivatives and Hedging (Topic 815), and Leases (Topic 842) Effective Dates (“ASU 2019-10”). ASU 2019-10 extended the mandatory effective date for smaller reporting companies to beginning after December 15, 2022. The adoption of

9

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

Financial Instruments - Credit Losses is not expected to have an impact on the Company’s condensed consolidated financial statements.
3. REAL ESTATE INVESTMENTS
Sale of Properties
On February 10, 2020, the Company consummated the disposition of Topaz Marketplace, located in Hesperia, California, for approximately $10.5 million in cash. The Company used the net proceeds from the sale to repay the line of credit in its entirety. The disposition of Topaz Marketplace resulted in a gain of approximately $0.9 million, which was included in the Company’s condensed consolidated statement of operations. The Company retained a residual land parcel, that is an improved drive-thru pad.
Since the sale of this property does not represent a strategic shift that will have a major effect on the Company’s operations and financial results, the results of operations of this property were not reported as discontinued operations in the Company’s condensed consolidated financial statements. The Company used the net proceeds from the sale of this property to repay the outstanding balance on its line of credit.
The Company’s condensed consolidated statements of operations include net operating income of approximately $52 thousand and $82 thousand for the three months ended March 31, 2020 and 2019, respectively, related to Topaz Marketplace.
Pro Forma Financial Information
The pro forma financial information below is based upon the Company’s historical condensed consolidated statements of operations for the three months ended March 31, 2020 and 2019, adjusted to give effect to the above sale transaction as if it had been completed at the beginning of 2020 and 2019, respectively. The pro forma financial information is presented for information purposes only, and may not be indicative of what actual results of operations would have been had the transaction occurred at the beginning of 2020 and 2019, respectively, nor does it purport to represent results of operations for future periods (amounts in thousands, except per share amounts):
 
(Pro Forma)
 
Three Months Ended March 31,
 
2020
 
2019
Rental and reimbursement revenues
$
689

 
$
726

Net income
373

 
555

Net income attributable to common stockholders
366

 
544

 
 
 
 
Net income per share, attributable to common shares - basic and diluted
$
0.03

 
$
0.05


Assets Held for Sale and Liabilities Related to Assets Held for Sale
Assets and liabilities related to Shops at Turkey Creek, located in Knoxville, Tennessee, were previously classified as held for sale, as the Company was in contract to sell the property. The buyer canceled the contract due to the uncertainty related to COVID-19. As a result, as of March 31, 2020, Shops at Turkey Creek no longer met certain criteria to be classified as held for sale. As such, all related assets, net of depreciation and liabilities were recorded within the relevant categories in the condensed consolidated balance sheet.
Additionally, as of March 31, 2020, the residual land parcel at Topaz Marketplace, located in Hesperia, California, no longer met certain criteria to be classified as held for sale. As such, the value related to the parcel was recorded within the relevant line item in the condensed consolidated balance sheet.
There were no assets classified as held for sale at March 31, 2020.
4. VARIABLE INTEREST ENTITIES
The Company has variable interests in, and is the primary beneficiary of, variable interest entities (“VIEs”) through its investments in (i) the Sunset & Gardner Joint Venture (formerly known as Gelson’s Joint Venture) and (ii) the 3032 Wilshire Joint Venture. The Company has consolidated the accounts of these variable interest entities.

10

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

Through March 31, 2020, post the initial capital contributions, the Company made additional capital contributions totaling approximately $6.6 million and $6.9 million to the Sunset & Gardner Joint Venture and Wilshire Joint Venture, respectively.
The following reflects the aggregate assets and liabilities of the Sunset & Gardner Joint Venture and the Wilshire Joint Venture, which were consolidated by the Company, as of March 31, 2020 and December 31, 2019 (amounts in thousands):
 
March 31,
 
December 31,
 
2020
 
2019
ASSETS
 
 
 
Properties under development and development costs:
 
 
 
Land
$
25,851

 
$
25,851

Buildings
550

 
554

Development costs
23,037

 
20,813

Properties under development and development costs
49,438

 
47,218

Cash, cash equivalents and restricted cash
634

 
2,154

Prepaid expenses and other assets, net
87

 
7

Lease intangibles, net
73

 
4

TOTAL ASSETS (1)
$
50,232

 
$
49,383

 
 
 
 
LIABILITIES
 
 
 
Notes payable, net (2)
$
18,375

 
$
16,713

Accounts payable and accrued expenses
1,410

 
1,702

Amounts due to affiliates
65

 
111

Other liabilities
5

 
5

TOTAL LIABILITIES
$
19,855

 
$
18,531

(1)
The assets of the Sunset & Gardner Joint Venture and Wilshire Joint Venture can be used only to settle obligations of the respective consolidated joint ventures.
(2)
As of March 31, 2020 and December 31, 2019, includes reclassification of approximately $0.4 million and $0.5 million, respectively, of deferred financing costs, net, as a contra-liability. The creditors of the consolidated joint ventures do not have recourse to the general credit of the Company. The notes payable of the Wilshire Joint Venture is partially guaranteed by the Company, refer to Note 7, “Notes Payable, Net”. The notes payable of the Sunset & Gardner Joint Venture is not guaranteed by the Company.
5. LEASES
Operating Leases
The Company’s real estate properties are leased to tenants under operating leases for which the terms and expirations vary. As of March 31, 2020, the leases at the Company’s properties, excluding properties classified as held for sale, have remaining terms (excluding options to extend) of up to 11.7 years with a weighted-average remaining term (excluding options to extend) of approximately 6.8 years. The leases may have provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other terms and conditions as negotiated. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. Generally, upon the execution of a lease, the Company requires security deposits from tenants in the form of a cash deposit and/or a letter of credit. Amounts required as security deposits vary depending upon the terms of the respective leases and the creditworthiness of the tenant, but generally are not significant amounts. Therefore, exposure to credit risk exists to the extent that a receivable from a tenant exceeds the amount of its security deposit. Security deposits received in cash related to tenant leases are included in other liabilities in the accompanying condensed consolidated balance sheets and totaled approximately $0.1 million and $0.2 million as of March 31, 2020 and December 31, 2019, respectively.

11

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

The following table presents the components of income from real estate operations for the three months ended March 31, 2020 and 2019 (amounts in thousands):
 
Three Months Ended
March 31,
 
2020
 
2019
Lease income - operating leases
$
636

 
$
702

Variable lease income (1)
171

 
242

Rental and reimbursements income
$
807

 
$
944

(1)
Primarily includes tenant reimbursements for real estate taxes, insurance and common area maintenance.
As of March 31, 2020, the future minimum rental income from the Company’s properties under non-cancelable operating leases, was as follows (amounts in thousands):
Remainder of 2020
$
1,515

2021
2,036

2022
2,053

2023
2,078

2024
2,031

Thereafter
5,813

Total
$
15,526


6. LEASE INTANGIBLES AND BELOW-MARKET LEASE LIABILITIES, NET
As of March 31, 2020 and December 31, 2019, the Company’s acquired lease intangibles and below-market lease liabilities, were as follows (amounts in thousands):
 
Lease Intangibles
 
Below-Market Lease Liabilities
 
March 31,
2020
 
December 31,
2019
 
March 31,
2020
 
December 31,
2019
Cost
$
2,173

 
$
2,084

 
$
(492
)
 
$
(492
)
Accumulated amortization
(826
)
 
(763
)
 
211

 
196

Total
$
1,347

 
$
1,321

 
$
(281
)
 
$
(296
)

The Company’s amortization of lease intangibles and below-market lease liabilities for the three months ended March 31, 2020 and 2019, were as follows (amounts in thousands): 
 
Lease Intangibles
 
Below-Market Lease Liabilities
 
Three Months Ended
March 31,
 
Three Months Ended
March 31,
 
2020
 
2019
 
2020
 
2019
Amortization
$
(63
)
 
$
(89
)
 
$
15

 
$
16


7. NOTES PAYABLE, NET
Multi-Property Secured Financing
On December 24th, the Company entered into a Loan Agreement (the “SRT Loan Agreement”) with PFP Holding Company, LLC (the “SRT Lender”) for a non-recourse secured loan (the “SRT Loan”).
The SRT Loan is secured by first deeds of trust on the Company’s five San Francisco assets (Fulton Shops, 8 Octavia, 400 Grove, 450 Hayes and 388 Fulton Street) as well as the Company’s Silverlake Collection located in Los Angeles. Proceeds from the SRT Loan were used by the Company to pay down the Company’s credit facility and in connection with such payment, the properties referenced above were released from liens related to that credit facility. The SRT Loan matures on January 9, 2023. The Company has an option to extend the term of the loan for two additional twelve-month periods, subject to the satisfaction of certain covenants and conditions contained in the SRT Loan Agreement. The Company has the right to prepay the SRT Loan in whole at any time or in part from time to time, subject to the payment of yield maintenance payments if such prepayment

12

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

occurs in the first 18 months of the loan term, calculated through the 18th monthly payment date, as well as certain expenses, costs or liabilities potentially incurred by the SRT Lender as a result of the prepayment and subject to certain other conditions contained in the loan documents. Individual properties may be released from the SRT Loan collateral in connection with bona fide third-party sales, subject to compliance with certain covenants and conditions contained in the SRT Loan Agreement. Any prepayment or repayment on or before the first 12 months of the loan term in connection with a bona fide third-party sale of a property securing the SRT Loan shall only require the payment of yield maintenance payments calculated through the 12th monthly payment date.
As of March 31, 2020, the SRT Loan had a principal balance of approximately $18.0 million. The SRT Loan is a floating LIBOR rate loan which bears interest at 30-day LIBOR (with a floor of 1.50%) plus 2.80%. The default rate is equal to 5% above the rate that otherwise would be in effect. Monthly payments are interest-only with the entire principal balance and all outstanding interest due at maturity.
Pursuant to the SRT Loan, the Company must comply with certain matters contained in the loan documents including but not limited to, (i) requirements to deliver audited and unaudited financial statements, SEC filings, tax returns, pro forma budgets, and quarterly compliance certificates, and (ii) minimum limits on the Company’s liquidity and tangible net worth. The SRT Loan contains customary covenants, including, without limitation, covenants with respect to maintenance of properties and insurance, compliance with laws and environmental matters, covenants limiting or prohibiting the creation of liens, and transactions with affiliates. At March 31, 2020, the Company was in compliance with the covenants in effect as of that date.
In connection with the SRT Loan, the Company executed customary non-recourse carveout and environmental guaranties, together with limited additional assurances with regard to the condominium structures of the San Francisco assets.
Line of Credit
On February 10, 2020, the Company used proceeds from the sale of Topaz Marketplace to repay the line of credit in its entirety. The line of credit expired of its own accord on February 15, 2020, with no balance outstanding. As part of the payoff, Shops at Turkey Creek was released from the line of credit.
Effective January 8, 2020, the Company elected to permanently reduce the maximum aggregate commitment under its line of credit from $30.0 million to $10.5 million. All other terms of the credit facility remained the same.
The Company’s line of credit was a revolving credit facility with an initial maximum aggregate commitment of $30.0 million. Effective February 15, 2017, the Company’s line of credit was refinanced to increase the maximum aggregate commitment under the credit facility from $30.0 million to $60.0 million. The credit facility matured on February 15, 2020. Each loan made pursuant to the credit facility will be either a LIBOR loan or a base rate loan, at the election of the Company, plus an applicable margin, as defined. Monthly payments are interest only with the entire principal balance and all outstanding interest due at maturity. The Company paid the lender an unused commitment fee, quarterly in arrears, which was accrued at 0.30% per annum, if the usage under the Company’s line of credit was less than or equal to 50% of the line of credit amount, and 0.20% per annum if the usage under the Company’s line of credit was greater than 50% of the line of credit amount. The Company was providing a guaranty of all of its obligations under the Company’s line of credit. Effective November 7, 2019, the Company elected to permanently reduce the maximum aggregate commitment under its line of credit from $60.0 million to $30.0 million. All other terms of the credit facility remained the same.
Loans Secured by Properties Under Development
On May 7, 2019, the Company refinanced and repaid its financing from Loan Oak Fund, LLC with a new construction loan from ReadyCap Commercial, LLC (the “Lender”) (the “Wilshire Construction Loan”). As of March 31, 2020, the Wilshire Construction Loan had a principal balance of approximately $10.1 million, with future funding availability up to a total of approximately $13.9 million, and bears an interest rate of 1-month LIBOR plus an interest margin of 4.25% per annum, payable monthly. The Wilshire Loan is scheduled to mature on May 10, 2022, with options to extend for two additional twelve-month periods, subject to certain conditions as stated in the loan agreement. The Wilshire Construction Loan is secured by a first Deed of Trust on the property. The Company executed a guaranty that guaranties that the loan interest reserve amounts are kept in compliance with the terms of the loan agreement. The Lender also required that a principal in the upstream owner of the Company’s joint venture partner in the Wilshire Joint Venture (the “Guarantor”), guarantees performance of borrower’s obligations under the loan agreement with respect to the completion of capital improvements to the property. The Company executed an Indemnity Agreement in favor of the Guarantor against liability under that completion guaranty except to the extent caused by gross negligence or willful misconduct, as well as for liabilities incurred under the Environmental Indemnity Agreement executed by the Guarantor in favor of the Lender. The Company used working capital funds of approximately $3.1 million to repay the difference between the Wilshire Construction Loan initial advance and the prior loan, to pay transaction costs, as well as to fund certain required interest and construction reserves. 

13

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

On October 29, 2018, the Company entered into a loan agreement with Lone Oak Fund, LLC (the “Sunset & Gardner Loan”). The Sunset & Gardner Loan has a principal balance of approximately $8.7 million, and bears an interest rate of 6.9% per annum. The Sunset & Gardner Loan was scheduled to mature on October 31, 2019. The Company extended the Sunset & Gardner Loan for an additional twelve month period under the same terms. The new maturity date is October 31, 2020. The Sunset & Gardner Loan is secured by a first Deed of Trust on the property.
The following is a schedule of future principal payments for all of the Company’s notes payable outstanding as of March 31, 2020 (amounts in thousands): 
Remainder of 2020
$
8,700

2021

2022
10,084

2023
18,000

   Total (1)
$
36,784

(1)
Total future principal payments reflect actual amounts due to creditors, and excludes reclassification of $1.1 million deferred financing costs, net.
During the three months ended March 31, 2020, the Company incurred and expensed approximately $0.2 million of interest costs, which consisted of amortization of deferred financing costs. During the three months ended March 31, 2019, the Company incurred and expensed approximately $0.2 million of interest costs, which primarily consisted of amortization of deferred financing costs. Also during the three months months ended March 31, 2020 and 2019, the Company incurred and capitalized approximately $0.4 million and $0.6 million, respectively, of interest expense related to the variable interest entities, which included amortization of deferred financing costs of approximately $80 thousand and $68 thousand, respectively, for each period.
As of both March 31, 2020 and December 31, 2019, interest expense payable was approximately $0.2 million, including an amount related to the variable interest entities of approximately $0.1 million, for each period.
8. FAIR VALUE DISCLOSURES
Certain financial assets and liabilities are measured at fair value on a recurring basis. The Company determines fair value using the following hierarchy:
Level 1: unadjusted quoted prices in active markets that are accessible at the measurement date for identical assets or liabilities;
Level 2: quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which significant inputs and significant value drivers are observable in active markets; and
Level 3: prices or valuation techniques where little or no market data is available for inputs that are significant to the fair value measurement.
The Company believes the total carrying values reflected on its consolidated balance sheets for cash, cash equivalents and restricted cash, accounts receivable, accounts payable and accrued expenses, amounts due to affiliates, mortgage loan and construction loan secured by properties under development, and the Company’s multi-property secured financing, reasonably approximated their fair values based on their nature, terms, and interest rates that approximate current market rates at March 31, 2020.
As part of the Company’s ongoing evaluation of the Company’s real estate portfolio, the Company estimates the fair value of its investments in real estate by obtaining outside independent appraisals on all of the operating properties. The appraised values are compared with the carrying values of its real estate portfolio to determine if there are indications of impairment.
For both the three months ended March 31, 2020 and 2019, the Company did not record any impairment losses.
9. EQUITY
Share Redemption Program
On April 1, 2015, the Company’s board of directors approved the reinstatement of the share redemption program (which had been suspended since January 15, 2013) and adopted the Amended and Restated Share Redemption Program (the “SRP”). Under the SRP, only shares submitted for repurchase in connection with the death or “qualifying disability” (as defined in the

14

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

SRP) of a stockholder are eligible for repurchase by the Company. Under the current SRP, as amended to date, the number of shares to be redeemed is limited to the lesser of (i) a total of $3.8 million for redemptions sought upon a stockholder’s death and a total of $1.2 million for redemptions sought upon a stockholder’s qualifying disability, and (ii) 5% of the weighted-average number of shares of the Company’s common stock outstanding during the prior calendar year. Share repurchases pursuant to the SRP are made at the sole discretion of the Company. The Company reserves the right to reject any redemption request for any reason or no reason or to amend or terminate the share redemption program at any time subject to the notice requirements in the SRP.
The redemption price for shares that are redeemed is 100% of the Company’s most recent estimated net asset value per share as of the applicable redemption date. A redemption request must be made within one year after the stockholder’s death or disability.
The SRP provides that any request to redeem less than $5,000 worth of shares will be treated as a request to redeem all of the stockholder’s shares. If the Company cannot honor all redemption requests received in a given quarter, all requests, including death and disability redemptions, will be honored on a pro rata basis. If the Company does not completely satisfy a redemption request in one quarter, it will treat the unsatisfied portion as a request for redemption in the next quarter when funds are available for redemption, unless the request is withdrawn. The Company may increase or decrease the amount of funding available for redemptions under the SRP on ten business days’ notice to stockholders. Shares submitted for redemption during any quarter will be redeemed on the penultimate business day of such quarter. The record date for quarterly distributions has historically been and is expected to continue to be the last business day of each quarter; therefore, shares that are redeemed during any quarter are expected to be redeemed prior to the record date and thus would not be eligible to receive the distribution declared for such quarter.
The following table summarizes share redemption activity during the three months ended March 31, 2020 and 2019 (amounts in thousands, except shares):
 
Three Months Ended
March 31,
 
2020
 
2019
Shares of common stock redeemed
19,907

 
20,855

Purchase price
$
117

 
$
126


As stated above, cumulatively, through March 31, 2020, pursuant to the Original Share Redemption Program and the Amended and Restated SRP, the Company has redeemed 878,458 shares sold in the Offering and/or its dividend reinvestment plan for $6.2 million.
Quarterly Distributions
In order to qualify as a REIT, the Company is required to distribute at least 90% of its annual REIT taxable income, subject to certain adjustments, to its stockholders. Some or all of the Company’s distributions have been paid, and in the future may continue to be paid from sources other than cash flows from operations. The Company’s board of directors evaluates the Company’s ability to make quarterly distributions based on the Company’s operational cash needs.

15

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

In light of the COVID-19 pandemic, its impact on the economy and the related future uncertainty, on March 27, 2020, the board of directors of the Company voted to suspend the payment of any dividend for the quarter ending March 31, 2020, and to reconsider future dividend payments on a quarter by quarter basis as more information becomes available on the impact of COVID-19 and related impact to the Company.
The following table set forth the quarterly distributions declared to the Company’s common stockholders and Common Unit holders for the year ended 2019 (amounts in thousands, except per share amounts):
 
Distribution Record
Date
 
Distribution
Payable
Date
 
Distribution Per Share of Common Stock /
Common Unit
 
Total Common
Stockholders
Distribution
 
Total Common
Unit Holders
Distribution
 
Total
Distribution
First Quarter 2019
3/31/2019
 
4/30/2019
 
$
0.06

 
$
651

 
$
14

 
$
665

Second Quarter 2019
6/30/2019
 
7/31/2019
 
0.06

 
648

 
14

 
662

Third Quarter 2019
9/30/2019
 
10/31/2019
 
0.06

 
646

 
13

 
659

Fourth Quarter 2019
12/31/2019
 
1/31/2020
 
0.02

 
215

 
5

 
220

Total
 
 
 
 
 
 
$
2,160

 
$
46

 
$
2,206

 
10. EARNINGS PER SHARE
EPS is computed by dividing net income (loss) attributable to common stockholders by the weighted average number of common shares outstanding during each period. Diluted EPS is computed after adjusting the basic EPS computation for the effect of potentially dilutive securities outstanding during the period. The effect of non-vested shares, if dilutive, is computed using the treasury stock method. The Company applies the two-class method for determining EPS as its outstanding shares of non-vested restricted stock are considered participating securities as dividend payments are not forfeited even if the underlying award does not vest. There was no unvested stock as of March 31, 2020. The Company’s excess of distributions over earnings related to participating securities are shown as a reduction in income (loss) attributable to common stockholders in the Company’s computation of EPS.
The following table sets forth the computation of the Company’s basic and diluted earnings per share for the three months ended March 31, 2020 and 2019 (amounts in thousands, except shares and per share amounts):
 
Three Months Ended
March 31,
 
2020
 
2019
Numerator - basic and diluted
 
 
 
Net income (loss)
$
425

 
$
(311
)
Net income (loss) attributable to non-controlling interests
8

 
(7
)
Net income (loss) attributable to common shares
$
417

 
$
(304
)
Denominator - basic and diluted
 
 
 
Basic weighted average common shares
10,759,198

 
10,862,806

Common Units (1)

 

Diluted weighted average common shares
10,759,198

 
10,862,806

Earnings (loss) per common share - basic and diluted
 
 
 
Net earnings (loss) attributable to common shares
$
0.04

 
$
(0.03
)
(1)
The effect of 217,475 convertible Common Units pursuant to the redemption rights outlined in the Company’s registration statement on Form S-11 have not been included as they would not be dilutive.
11. RELATED PARTY TRANSACTIONS
On August 7, 2013, the Company entered into the Advisory Agreement with the Advisor, which has been renewed for successive terms with a current expiration date of August 9, 2020. The Advisor manages the Company’s business as the Company’s external advisor pursuant to the Advisory Agreement. Pursuant to the Advisory Agreement, the Company will pay the Advisor specified fees for services related to the investment of funds in real estate and real estate-related investments, management of the Company’s investments and for other services.

16

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

Summary of Related Party Fees
The following table sets forth the Advisor related party costs incurred and payable by the Company for the periods presented (amounts in thousands):
 
Incurred
 
Payable as of
 
Three Months Ended
March 31,
 
March 31,
 
December 31,
Expensed
2020
 
2019
 
2020
 
2019
Asset management fees
$
167

 
$
157

 
$

 
$

Reimbursement of operating expenses
6

 
11

 

 

Property management fees
21

 
29

 
6

 
7

Disposition fees
157

 

 

 

Total
$
351

 
$
197

 
$
6

 
$
7

 
 
 
 
 
 
 
 
Capitalized
 
 
 
 
 
 
 
Acquisition fees
$
6

 
$
7

 
$

 
$

Leasing fees
39

 

 

 

Legal leasing fees
8

 

 

 

Construction management fees
66

 

 
65

 
111

Financing coordination fees

 

 

 
22

Total
$
119

 
$
7

 
$
65

 
$
133


Acquisition Fees
Under the Advisory Agreement, the Advisor is entitled to receive an acquisition fee equal to 1% of (1) the cost of each investment acquired directly by the Company or (2) the Company’s allocable cost of an investment acquired pursuant to a joint venture, in each case including purchase price, acquisition expenses and any debt attributable to such investments. An acquisition fee is capitalized by the Company when the related transaction does not qualify as a business combination; otherwise an acquisition fee is expensed.
Financing Coordination Fees
Under the Advisory Agreement, the Advisor is entitled to receive a financing coordination fee equal to 1% of the amount made available and/or outstanding under any (1) financing obtained or assumed, directly or indirectly, by the Company or the OP and used to acquire or originate investments, or (2) the refinancing of any financing obtained or assumed, directly or indirectly, by the Company or the OP.
Asset Management Fees
Under the Advisory Agreement, the Advisor is entitled to receive an asset management fee equal to a monthly fee of one-twelfth (1/12th) of 0.6% of the higher of (1) aggregate cost on a GAAP basis (before non-cash reserves and depreciation) of all investments the Company owns, including any debt attributable to such investments, or (2) the fair market value of the Company’s investments (before non-cash reserves and depreciation) if the board of directors has authorized the estimate of a fair market value of the Company’s investments; provided, however, that the asset management fee will not be less than $250,000 in the aggregate during any one calendar year.

17

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

Reimbursement of Operating Expenses
The Company reimburses the Advisor for all expenses paid or incurred by the Advisor in connection with the services provided to the Company, subject to the limitation that the Company will not reimburse the Advisor for any amount by which the Company’s total operating expenses (including the asset management fee described below) at the end of the four preceding fiscal quarters exceeded the greater of (1) 2% of its average invested assets (as defined in the Company’s Articles of Amendment and Restatement (the “Charter”)); or (2) 25% of its net income (as defined in the Charter) determined without reduction for any additions to depreciation, bad debts or other similar non-cash expenses and excluding any gain from the sale of the Company’s assets for that period (the “2%/25% Guideline”). The Advisor is required to reimburse the Company quarterly for any amounts by which total operating expenses exceed the 2%/25% Guideline in the previous expense year that the independent directors do not approve. The Company will not reimburse the Advisor for any of its personnel costs or other overhead costs except for customary reimbursements for personnel costs under property management agreements entered into between the OP and the Advisor or its affiliates. Notwithstanding the above, the Company may reimburse the Advisor for expenses in excess of the 2%/25% Guideline if a majority of the independent directors determine that such excess expenses are justified based on unusual and non-recurring factors. Pursuant to an amendment to the Advisory Agreement entered on August 2, 2018, the board of directors, including a majority of the independent directors identified certain unusual and non-recurring factors that would justify reimbursement to the Advisor of amounts in excess of the 2%/25% Guidelines and confirmed that the Advisor would not be obligated to reimburse the Company for these excess amounts to the extent the excess was caused by such factors.
For the three months ended March 31, 2020 and 2019, the Company’s total operating expenses (as defined in the Charter) did not exceed the 2%/25% Guideline.
Property Management Fees
Under the property management agreements between the Company and Glenborough, Glenborough is entitled to receive property management fees calculated at a maximum of up to 4% of the properties’ gross revenue. The property management agreements with Glenborough have been renewed for an additional 12 months, beginning on August 10, 2019. Property management agreements with Glenborough automatically renew every year, unless expressly terminated.
Disposition Fees
Under the Advisory Agreement, if the Advisor or its affiliates provide a substantial amount of services, as determined by the Company’s independent directors, in connection with the sale of a real property, the Advisor or its affiliates may be paid disposition fees up to 50% of a customary and competitive real estate commission, but not to exceed 3% of the contract sales price of each property sold.
Leasing Fees
Under the property management agreements, Glenborough is entitled to receive a separate fee for the leases of new tenants, and for expansions, extensions and renewals of existing tenants in an amount not to exceed the fee customarily charged by similarly situated parties rendering similar services in the same geographic area for similar properties.
Legal Leasing Fees
Under the property management agreements, Glenborough is entitled to receive a market-based legal leasing fee for the negotiation and production of new leases, renewals, and amendments.
Construction Management Fees
In connection with the construction or repair in or about a property, the property manager is responsible for coordinating and facilitating the planning and the performance of all construction and is entitled to receive a fee equal to 5% of the hard costs for the project in question.
12. COMMITMENTS AND CONTINGENCIES
Economic Dependency
The Company is dependent on the Advisor and its affiliates for certain services that are essential to the Company, including the identification, evaluation, negotiation, purchase, and disposition of real estate and real estate-related investments, management of the daily operations of the Company’s real estate and real estate-related investment portfolio, and other general and administrative responsibilities. In the event that the Advisor is unable to provide such services to the Company, the Company will be required to obtain such services from other sources.

18

STRATEGIC REALTY TRUST, INC. AND SUBSIDIARIES
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (continued)
(unaudited)

Environmental
As an owner of real estate, the Company is subject to various environmental laws of federal, state and local governments. The Company is not aware of any environmental liability that could have a material adverse effect on its condensed consolidated financial condition or results of operations. However, changes in applicable environmental laws and regulations, the uses and conditions of properties in the vicinity of the Company’s properties, the activities of its tenants and other environmental conditions of which the Company is unaware with respect to the properties could result in future environmental liabilities.
13. SUBSEQUENT EVENTS
COVID-19 Pandemic
The Company is monitoring the impact of the COVID-19 pandemic on all aspects of its business, including how the pandemic will impact its tenants and business partners. While the Company did not incur significant disruptions from the COVID-19 pandemic during the three months ended March 31, 2020, a majority of the Company’s tenants have not paid April rent and have recently requested rent deferral or rent abatement as a result of the pandemic, and therefore, the Company is unable to predict the full impact that the pandemic will have on its financial condition, results of operations and cash flows due to numerous uncertainties. The Company is evaluating each tenant’s request for rent relief on an individual basis and is considering a number of factors. Not all tenant requests will result in modified agreements nor is the Company forgoing its contractual rights under its lease agreements. See Item 2 - “Management’s Discussion and Analysis of Financial Condition and Results of Operations - Impact of COVID-19” for additional information regarding the potential impact of COVID-19 on the Company’s operations.
The full extent to which the COVID-19 pandemic impacts the Company’s operations and those of its tenants will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. While the Company is not able at this time to estimate the impact of the COVID-19 pandemic on its financial position and results of operations, it could be material. 
Share Redemption Program
In order to preserve cash in light of the uncertainty relating to the duration of shelter-in-place orders and the economic impact of COVID-19 on the Company, by unanimous written consent executed on April 21, 2020, the Board approved the suspension of the SRP, which offered redemption opportunities only in connection with a stockholder’s death or qualifying disability.
Under the SRP, the Board may amend, suspend, or terminate the SRP with 30 days’ notice to the Company’s stockholders. The Current Report on Form 8-K, filed on April 21, 2020 with the SEC, serves as such required notice and therefore the suspension of the SRP will be effective on May 21, 2020. The SRP will remain suspended and no further redemptions will be made unless and until the Board approves the resumption of the SRP. During the suspension, the Company will continue to accept death and disability redemption filings from stockholders, but will not take any action with regard to those requests until the Board has elected to lift the suspension and provided the terms and conditions for any continuation of the program.

19


ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
The following discussion and analysis should be read in conjunction with our interim unaudited condensed consolidated financial statements and the notes thereto and the other unaudited financial data included in this Quarterly Report on Form 10-Q and in our audited consolidated financial statements and the notes thereto, and Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report on Form 10-K for the year ended December 31, 2019, as filed with the Securities and Exchange Commission, or SEC, on March 18, 2020, which we refer to herein as our “2019 Annual Report on Form 10-K.”
As used herein, the terms “we,” “our,” “us,” and “Company” refer to Strategic Realty Trust, Inc., and, as required by context, Strategic Realty Operating Partnership, L.P., a Delaware limited partnership, which we refer to as our “operating partnership” or “OP”, and to their respective subsidiaries. References to “shares” and “our common stock” refer to the shares of our common stock. 
Special Note Regarding Forward-Looking Statements
Certain statements included in this Quarterly Report on Form 10-Q that are not historical facts (including any statements concerning investment objectives, other plans and objectives of management for future operations or economic performance, or assumptions or forecasts related thereto) are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). These statements are only predictions. We caution that forward-looking statements are not guarantees. Actual events or our investments and results of operations could differ materially from those expressed or implied in any forward-looking statements. Forward-looking statements are typically identified by the use of terms such as “may,” “should,” “expect,” “could,” “intend,” “plan,” “anticipate,” “estimate,” “believe,” “continue,” “predict,” “potential” or the negative of such terms and other comparable terminology.
The forward-looking statements included herein are based upon our current expectations, plans, estimates, assumptions and beliefs, which involve numerous risks and uncertainties. Assumptions relating to the foregoing involve judgments with respect to, among other things, future economic, competitive and market conditions and future business decisions, all of which are difficult or impossible to predict accurately and many of which are beyond our control. Although we believe that the expectations reflected in such forward-looking statements are based on reasonable assumptions, our actual results and performance could differ materially from those set forth in the forward-looking statements. The following are some of the risks and uncertainties, although not all of the risks and uncertainties, that could cause our actual results to differ materially from those presented in our forward-looking statements:
The potential adverse effect of the ongoing public health crisis of the novel coronavirus disease (COVID-19) pandemic, or any future pandemic, epidemic or outbreak of infectious disease, on the financial condition, results of operations, cash flows and performance of the Company and its tenants, the real estate market and the global economy and financial markets.
Our executive officers and certain other key real estate professionals are also officers, directors, managers, key professionals and/or holders of a direct or indirect controlling interest in our advisor. As a result, they face conflicts of interest, including conflicts created by our advisor’s compensation arrangements with us and conflicts in allocating time among us and other programs and business activities.
We are uncertain of our sources for funding our future capital needs. If we cannot obtain debt or equity financing on acceptable terms, our ability to continue to acquire real properties or other real estate-related assets, fund or expand our operations and pay distributions to our stockholders will be adversely affected.
We depend on tenants for our revenue and, accordingly, our revenue is dependent upon the success and economic viability of our tenants. Revenues from our properties could decrease due to a reduction in tenants (caused by factors including, but not limited to, tenant defaults, tenant insolvency, early termination of tenant leases and non-renewal of existing tenant leases) and/or lower rental rates, making it more difficult for us to meet our financial obligations, including debt service and our ability to pay distributions to our stockholders.
A significant portion of our assets are concentrated in one state and in urban retail properties, any adverse economic, real estate or business conditions in this geographic area or in the urban retail market could affect our operating results and our ability to pay distributions to our stockholders.
Our current and future investments in real estate and other real estate-related investments may be affected by unfavorable real estate market and general economic conditions, which could decrease the value of those assets and reduce the investment return to our stockholders. Revenues from our properties could decrease. Such events would

20


make it more difficult for us to meet our debt service obligations and limit our ability to pay distributions to our stockholders.
Certain of our debt obligations have variable interest rates with interest and related payments that vary with the movement of LIBOR or other indices. Increases in these indices could increase the amount of our debt payments and limit our ability to pay distributions to our stockholders.
All forward-looking statements should be read in light of the risks identified in Part I, Item 1A of our 2019 Annual Report on Form 10-K. Any of the assumptions underlying the forward-looking statements included herein could be inaccurate, and undue reliance should not be placed upon on any forward-looking statements included herein. All forward-looking statements are made as of the date of this Quarterly Report on Form 10-Q, and the risk that actual results will differ materially from the expectations expressed herein will increase with the passage of time. Moreover, you should interpret many of the risks identified in this Quarterly Report, as well as the risks set forth above, as being heightened as a result of the ongoing and numerous adverse impacts of the COVID-19 pandemic. Except as otherwise required by the federal securities laws, we undertake no obligation to publicly update or revise any forward-looking statements made after the date of this Quarterly Report on Form 10-Q, whether as a result of new information, future events, changed circumstances or any other reason. In light of the significant uncertainties inherent in the forward-looking statements included in this Quarterly Report on Form 10-Q, and the risks described in Part I, Item 1A of our 2019 Annual Report on Form 10-K, the inclusion of such forward-looking statements should not be regarded as a representation by us or any other person that the objectives and plans set forth in this Quarterly Report on Form 10-Q will be achieved.

21


Overview
We are a Maryland corporation that was formed on September 18, 2008, to invest in and manage a portfolio of income-producing retail properties, located in the United States, real estate-owning entities and real estate-related assets, including the investment in or origination of mortgage, mezzanine, bridge and other loans related to commercial real estate. During the first quarter of 2016, we also invested, through joint ventures, in two significant retail projects under development. We have elected to be taxed as a real estate investment trust (“REIT”) for federal income tax purposes, commencing with the taxable year ended December 31, 2009, and we have operated and intend to continue to operate in such a manner. We own substantially all of our assets and conduct our operations through our operating partnership, of which we are the sole general partner. We also own a majority of the outstanding limited partner interests in the operating partnership.
Since our inception, our business has been managed by an external advisor. We do not have direct employees and all management and administrative personnel responsible for conducting our business are employed by our advisor. Currently we are externally managed and advised by SRT Advisor, LLC, a Delaware limited liability company (the “Advisor”) pursuant to an advisory agreement with the Advisor (the “Advisory Agreement”) initially executed on August 10, 2013, and subsequently renewed every year through 2019. The current term of the Advisory Agreement terminates on August 9, 2020. The Advisor is an affiliate of Glenborough, LLC (together with its affiliates, “Glenborough”), a privately held full-service real estate investment and management company focused on the acquisition, management and leasing of commercial properties.
Impact of COVID-19
On March 11, 2020, the World Health Organization declared COVID-19, a respiratory illness caused by the novel coronavirus, a pandemic, and on March 13, 2020, the United States declared a national emergency with respect to COVID-19. The COVID-19 pandemic has caused state and local governments to institute quarantines, shelter-in-place rules and restrictions on travel, the types of business that may continue to operate, and the types of construction projects that may continue. California, where the majority of our properties are located, declared a state of emergency on March 4, 2020 and instituted a shelter-in-place order on March 16, 2020 to reduce the spread of COVID-19.
COVID-19 and the efforts to contain its spread have significantly impacted the global economy, the U.S. economy, the economies of the local markets throughout California in which our properties are predominately located, and the broader financial markets. Nearly every industry has been impacted directly or indirectly, and the U.S. retail market has come under severe pressure due to numerous factors, including preventative measures taken by local, state and federal authorities to alleviate the public health crisis such as mandatory business closures, quarantines, restrictions on travel and shelter-in-place or stay-at-home orders. There is uncertainty as to the time, date and extent to which these restrictions will be relaxed, lifted or reinstated, businesses of tenants that have closed, either voluntarily or by mandate, will reopen or when customers will re-engage with tenants as they have in the past.
While we did not incur significant disruptions from the COVID-19 pandemic during the three months ended March 31, 2020, we believe that there is a reasonable risk that the COVID-19 outbreak could negatively impact our financial condition and results of operations, including but not limited to, declines in real estate rental revenues, the inability to sell certain properties at a favorable price, and a decrease in construction and leasing activity. A majority of our tenants have not paid April rent and have recently requested rent deferral or rent abatement as a result of the pandemic. Tenants that requested rent relief account for approximately 93% of our annualized rents. We are reviewing these requests on a case by case basis and are continuing to monitor and communicate with our commercial tenants to assess their needs and ability to pay rent. As of May 6, 2020, we have collected approximately 13% of April’s monthly billings to tenants. In most cases, it is in our best interest to help our tenants remain in business and reopen when shelter-in-place orders or other mandated closures are lifted. If these tenants fail, finding replacement tenants may be costly and time-consuming. In addition, while the majority of our properties are fully leased as of March 31, 2020, we expect that the effects of the COVID-19 pandemic may impact our ability to lease up available commercial space at certain properties. For example, while the Wilshire Property is nearing completion and was 60% leased as of March 31, 2020, there were three potential tenants who put their plans on hold in light of the COVID-19 pandemic, however they remain interested in the project. As of March 31, 2020, we had approximately 8,000 square feet of vacant commercial space and approximately 600 square feet of commercial lease expirations scheduled for the remainder of 2020.
To mitigate the impact of COVID-19 on our operations and liquidity, we have taken a number of proactive measures, which include the following:
Our Advisor has been able to transition all employees and operations to a remote work environment, beginning on March 16, 2020, and we have been fortunate that our operations have continued successfully during these difficult times.

22


We are in constant communication with our tenants and are assisting tenants in identifying local, state and federal resources that may be available to support their businesses and employees during the pandemic, including stimulus funds that may be available under the Coronavirus Aid, Relief, and Economic Security Act of 2020.
We believe we have adequate cash and cash equivalents to service our debts and pay for our ongoing general and administrative expenses for the foreseeable future. As of March 31, 2020, we have approximately $5.4 million in cash and cash equivalents. Furthermore, the Shops at Turkey Creek remain unencumbered by debt and is available for financing to provide us funds if needed.
We fully paid off the revolving line of credit with the SRT Loan (as defined below) from PFP Holding Company, LLC (the “SRT Lender”). The SRT Loan is secured by six of our core urban properties in Los Angeles and San Francisco. The SRT Loan does not have the sort of restrictive covenants and ongoing debt coverage ratios that could trigger a default caused by tenants not paying rent or seeking rent relief (unlike the former line of credit).
We remain in compliance with all the terms of the Wilshire Construction Loan (as defined below), which matures on May 10, 2022 with the options to extend for two additional twelve-month periods, subject to certain conditions. Similarly, we remain in compliance with the Sunset & Gardner Loan (as defined below), which matures on October 31, 2020, and we are in discussions to further extend the maturity date of the Sunset & Gardner Loan.
To further preserve cash and liquidity, we suspended our Amended and Restated Share Redemption Program (the “SRP”), such suspension to be effective on May 21, 2020. The SRP will remain suspended and no further redemptions will be made unless and until our board of directors (the “Board”) approves the resumption of the SRP. During the suspension, we will continue to accept death and disability redemption filings from stockholders, but will not take any action with regard to those requests until the Board has elected to lift the suspension and provided the terms and conditions for any continuation of the program. In addition, on March 27, 2020, the Board decided to suspend the payment of any dividend for the quarter ending March 31, 2020, and will reconsider future dividend payments on a quarter by quarter basis as more information becomes available on the impact of COVID-19 and related impact to us.
Given the uncertainty of the COVID-19 pandemic’s near and potential long-term impact on our business, the full extent of the financial impact cannot be reasonably estimated at this time. However, there are those who believe that, as more tools are developed to fight COVID-19 - increased testing, enhanced monitoring, data analysis and identification of effective therapeutics-the country can, anchored by advice of healthcare specialists, incrementally foster economic activity in the near term and at some point with a vaccine and time, the country should return to a more normal state as with other pandemics in the past.
Property Portfolio
As of March 31, 2020, our property portfolio included 7 retail properties, excluding a pad, which we refer to as “our properties” or “our portfolio,” comprising an aggregate of approximately 43,000 square feet of multi-tenant, commercial retail space located in two states. We purchased our properties for an aggregate purchase price of approximately $39.6 million. As of March 31, 2020 approximately 81% of our portfolio was leased (based on rentable square footage), with a weighted-average remaining lease term of approximately 6.8 years. As of December 31, 2019, approximately 90% of our portfolio was leased (based on rentable square footage), with a weighted-average remaining lease term of approximately 6.8 years.
(dollars in thousands)
 
 
 
Rentable Square
Feet
 
Percent Leased (2)
 
Effective
Rent (3)
(per Sq. Foot)
 
Date
Acquired
 
Original
Purchase
 Price (4)
 
Debt (5)
Property Name (1)
 
Location
 
 
 
 
 
 
Shops at Turkey Creek
 
Knoxville, TN
 
16,324

 
61
%
 
$
30.59

 
3/12/2012
 
$
4,300

 
$

400 Grove Street
 
San Francisco, CA
 
2,000

 
100
%
 
63.04

 
6/14/2016
 
2,890

 
1,450

8 Octavia Street
 
San Francisco, CA
 
3,640

 
47
%
 
53.89

 
6/14/2016
 
2,740

 
1,500

Fulton Shops
 
San Francisco, CA
 
3,758

 
100
%
 
57.68

 
7/27/2016
 
4,595

 
2,200

450 Hayes
 
San Francisco, CA
 
3,724

 
100
%
 
93.08

 
12/22/2016
 
7,567

 
3,650

388 Fulton
 
San Francisco, CA
 
3,110

 
100
%
 
68.13

 
1/4/2017
 
4,195

 
2,300

Silver Lake
 
Los Angeles, CA
 
10,497

 
100
%
 
68.80

 
1/11/2017
 
13,300

 
6,900

 
 
 
 
43,053

 
 
 
 
 
 
 
$
39,587

 
$
18,000

(1)
List of properties does not include a residual parcel at Topaz Marketplace as of March 31, 2020.

23


(2)
Percentage is based on leased rentable square feet of each property as of March 31, 2020.
(3)
Effective rent per square foot is calculated by dividing the annualized March 2020 contractual base rent by the total square feet occupied at the property. The contractual base rent does not include other items such as tenant concessions (e.g., free rent), percentage rent, and expense recoveries.
(4)
The purchase price for Shops at Turkey Creek includes the issuance of common units in our operating partnership to the sellers.
(5)
Debt represents the outstanding balance as of March 31, 2020, and excludes reclassification of approximately $0.7 million deferred financing costs, net, as a contra-liability. For more information on our financing, refer to Note 7. “Notes Payable, Net” to our condensed consolidated financial statements included in this Quarterly Report on Form 10-Q.
Properties Under Development
As of March 31, 2020, we had two properties under development. The properties are identified in the following table (dollar amounts in thousands):
Properties Under Development
 
Location
 
Estimated
Completion Date
 
Estimated
Expected
Square Feet
 
Debt
Wilshire Property
 
Santa Monica, CA
 
August, 2020
 
12,500

 
$
10,084

Sunset & Gardner Property
 
Hollywood, CA
 
January, 2022
 
37,000

 
8,700

Total
 
 
 
 
 
49,500

 
$
18,784

Results of Operations
Comparison of the three months ended March 31, 2020, versus the three months ended March 31, 2019.
The following table provides summary information about our results of operations for the three months ended March 31, 2020 and 2019 (amounts in thousands):
 
Three Months Ended
March 31,
 
 
 
 
 
2020
 
2019
 
$ Change
 
% Change
Rental revenue and reimbursements
$
807

 
$
944

 
$
(137
)
 
(14.5
)%
Operating and maintenance expenses
450

 
270

 
180

 
66.7
 %
General and administrative expenses
405

 
399

 
6

 
1.5
 %
Depreciation and amortization expenses
301

 
377

 
(76
)
 
(20.2
)%
Interest expense
171

 
189

 
(18
)
 
(9.5
)%
Operating loss
(520
)