Filed Pursuant to Rule 424(b)(3)
Registration
No. 333-269415
PROSPECTUS SUPPLEMENT NO. 5
(To Prospectus dated April 1, 2024)

BLUEROCK HOMES TRUST, INC.
This prospectus supplement
(the “Prospectus Supplement”) updates, amends, and supplements the prospectus dated April 1, 2024, as supplemented by (i)
that certain Prospectus Supplement No. 1 dated May 9, 2024, (ii) that certain Prospectus Supplement No. 2 dated May 22, 2024, (iii) that
certain Prospectus Supplement No. 3 dated June 11, 2024, and (iv) that certain Prospectus Supplement No. 4 dated August 8, 2024 (collectively,
the “Prospectus”), which forms a part of our Registration Statement on Form S-11 (Registration No. 333-269415). Capitalized
terms used in this Prospectus Supplement No. 5 and not otherwise defined herein have the meanings specified in the Prospectus.
This Prospectus Supplement
No. 5 is being filed to update, amend, and supplement the information in the Prospectus with the information contained in (a) our Current
Report on Form 8-K filed with the Securities and Exchange Commission (“SEC”) on November 14, 2024 (the “Form 8-K Filing”),
and (b) our Quarterly Report on Form 10-Q filed with the SEC on November 14, 2024 (the “Form 10-Q Filing”). Accordingly, we
have attached the Form 8-K Filing and the Form 10-Q Filing to this Prospectus Supplement.
You should read this Prospectus
Supplement in conjunction with the Prospectus, including any amendments and supplements thereto. This Prospectus Supplement is qualified
by reference to the Prospectus, except to the extent that the information contained in this Prospectus Supplement supersedes the information
contained in the Prospectus. This Prospectus Supplement is not complete without, and may not be utilized except in connection with, the
Prospectus.
Investing in our securities
involves significant risks. See the “Risk Factors” sections of the Prospectus and in Item 1A of our Annual Report on Form
10-K filed on March 12, 2024 for a discussion of the risks that should be considered in connection with an investment in our securities.
Neither the SEC nor
any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of the Prospectus
or this Prospectus Supplement. Any representation to the contrary is a criminal offense.
The date of this Prospectus Supplement is November
14, 2024
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): March 25, 2024
BLUEROCK HOMES TRUST, INC.
(Exact name of registrant as specified in its charter)
Maryland |
001-41322 |
87-4211187 |
(State or other jurisdiction of incorporation
or organization) |
(Commission File Number) |
(I.R.S. Employer Identification
No.) |
1345 Avenue of the Americas, 32nd Floor
New York, NY 10105
(Address of principal executive offices)
(212) 843-1601
(Registrant’s telephone number, including
area code)
None
(Former name or former address,
if changed since last report)
Securities registered pursuant to Section 12(b) of
the Exchange Act:
Title of each class |
Trading Symbol |
Name of each exchange
on which registered |
Class A Common Stock, $0.01 par value
per share |
BHM |
NYSE American |
Check the appropriate box below if the Form 8-K
filing is intended to simultaneously satisfy the filing obligations of the registrant under any of the following provisions:
¨
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2
of this chapter).
Emerging
Growth Company x
If an emerging growth
company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or
revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
|
ITEM 2.01 |
COMPLETION OF ACQUISITION OR DISPOSITION OF ASSETS |
On March 25, 2024, Bluerock
Homes Trust, Inc., a Maryland corporation (the “Company”), through a 95% owned joint venture entity of its operating partnership,
Bluerock Residential Holdings, L.P., a Delaware limited partnership, acquired a 294-unit residential community located in Houston, Texas
known as Villas at Huffmeister for a total purchase price of approximately $41.2 million, inclusive of a $3.1 million fair value reduction
related to assumed debt. The sale was based on arm’s length negotiations with an unaffiliated seller. In evaluating Villas at Huffmeister
as a potential investment, the Company considered a variety of factors, including overall valuation of net rental income, expected capital
expenditures, submarket demographics, community features and amenities, location, price per unit, and occupancy.
Senior Loan Financing for the Acquisition of
Villas at Huffmeister
The acquisition of Villas
at Huffmeister was funded with approximately $18.1 million of cash funded by the Company, inclusive of certain adjustments typical in
such real estate transactions, and a senior loan assumption in the principal amount of approximately $24.3 million (the “Villas
Senior Loan”), inclusive of a fair value debt adjustment. The Villas Senior Loan is secured by Villas at Huffmeister and bears interest
at a fixed rate of 3.56%, with monthly payments of principal and interest based on thirty-year amortization; previously, monthly payments
were interest-only through October 2024. The Villas Senior Loan matures on October 1, 2029 and can be prepaid, in whole, subject to a
prepayment premium if prepayment occurs before June 29, 2029; if prepayment of the Villas Senior Loan occurs after such date, no prepayment
penalty or premium is payable.
|
ITEM 9.01 |
FINANCIAL STATEMENETS AND EXHIBITS |
(a) |
Financial Statements of Real Estate Acquired
Villas at Huffmeister
Independent Auditor’s Report
Statement of Revenues and Certain Operating Expenses
for the Year Ended December 31, 2023
Notes to Statement of Revenues and Certain Operating
Expenses |
|
|
(b) |
Pro Forma Financial Information
Bluerock Homes Trust, Inc.
Pro Forma Condensed Consolidated Balance Sheet
as of December 31, 2023 (unaudited)
Notes to Pro Forma Condensed Consolidated Balance
Sheet as of December 31, 2023 (unaudited)
Pro Forma Condensed Consolidated Statement of
Operations for the year ended December 31, 2023 (unaudited)
Notes to Pro Forma Condensed Consolidated Statement
of Operations for the year ended December 31, 2023 (unaudited) |
Statements in this Current
Report on Form 8-K, including intentions, beliefs, expectations or projections relating to items such as the long-term performance of
the Company’s portfolio are forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended,
and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based on current expectations and assumptions
with respect to, among other things, future economic, competitive and market conditions, and future business decisions that may prove
incorrect or inaccurate. Important factors that could cause actual results to differ materially from those in the forward-looking statements
include the risks described under the heading “Risk Factors” in the Company’s Annual Report on Form 10-K filed with
the SEC on March 12, 2024 and its other filings with the SEC.
(c) |
Exhibit No. |
Description |
|
|
|
|
23.1 |
Consent of
Plante Moran, PC |
Independent Auditor’s Report
To the Board of Directors and Stockholders
Bluerock Homes Trust, Inc.
Opinion
We have audited the accompanying statements of
revenues and certain operating expenses of Villas at Huffmeister (the "Property") for the year ended December 31, 2023 and the
related notes thereto (“the Statements”).
In our opinion, the accompanying Statements present
fairly, in all material respects, the revenue and certain operating expenses of the Property described in Note 2 of the Statements for
the year ended December 31, 2023 in accordance with accounting principles generally accepted in the United States of America.
Basis for Opinion
We conducted our audit in accordance with auditing
standards generally accepted in the United States of America. Our responsibilities under those standards are further described in the
Auditor's Responsibilities for the Audit of the Statements section of our report. We are required to be independent of the Property
and to meet our ethical responsibilities in accordance with the relevant ethical requirements relating to our audit. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.
Emphasis of Matter – Purpose of the
Presentation
We draw attention to Note 2 to the Statements,
which describes that the Statements have been prepared for the purpose of complying with the rules and regulations of the Securities and
Exchange Commission for inclusion in the Form 8-K of Bluerock Homes Trust, Inc. and is not intended to be a complete presentation of the
Property's revenue and expenses. Our opinion is not modified with respect to this matter.
Responsibilities of Management for the Statements
Management is responsible for the preparation
and fair presentation of the Statements in accordance with accounting principles generally accepted in the United States of America and
for the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the Statements
that are free from material misstatement, whether due to fraud or error.
Auditor’s Responsibilities for the
Audit of the Statements
Our objectives are to obtain reasonable assurance
about whether the Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's
report that includes our opinion. Reasonable assurance is a high level of assurance but is not absolute assurance and, therefore, is not
a guarantee that an audit conducted in accordance with generally accepted auditing standards (“GAAS”) will always detect a
material misstatement when it exists. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control. Misstatements
are considered material if there is a substantial likelihood that, individually or in the aggregate, they would influence the judgment
made by a reasonable user based on the Statements.
In performing an audit in accordance with GAAS,
we:
|
· |
Exercise professional judgment and maintain professional skepticism throughout the audit. |
|
· |
Identify and assess the risks of material misstatement of the Statements, whether due to fraud or error, and
design and perform audit procedures responsive to those risks. Such procedures include examining, on a test basis, evidence regarding
the amounts and disclosures in the Statements. |
|
· |
Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the Property's internal
control. Accordingly, no such opinion is expressed. |
|
· |
Evaluate the appropriateness of accounting policies used and the reasonableness of significant accounting
estimates made by management, as well as evaluate the overall presentation of the Statements. |
|
· |
Conclude whether, in our judgment, there are conditions or events, considered in the aggregate, that raise
substantial doubt about the Property's ability to continue as a going concern for a reasonable period of time. |
We are required to communicate with those charged
with governance regarding, among other matters, the planned scope and timing of the audit, significant audit findings, and certain internal
control-related matters that we identified during the audit.
/s/ Plante Moran, PC |
East Lansing, Michigan |
November 14, 2024 |
VILLAS AT HUFFMEISTER
STATEMENT OF REVENUES AND CERTAIN OPERATING
EXPENSES
(In thousands)
|
|
Year Ended
December 31, 2023 |
|
Revenues |
|
|
|
|
Rental and other property revenues |
|
$ |
5,516 |
|
Total revenues |
|
|
5,516 |
|
|
|
|
|
|
Certain Operating Expenses |
|
|
|
|
Property operating expenses |
|
|
2,594 |
|
Total certain operating expenses |
|
|
2,594 |
|
|
|
|
|
|
Revenues in Excess of Certain Operating Expenses |
|
$ |
2,922 |
|
See accompanying notes to statement of revenues
and certain operating expenses
VILLAS AT HUFFMEISTER
NOTES TO STATEMENT OF REVENUES AND CERTAIN OPERATING
EXPENSES
Note 1 – Business
Villas
at Huffmeister (the “Property”) was acquired pursuant to a purchase agreement between an affiliate of Bluerock Residential
Holdings, L.P. (Bluerock Homes Trust, Inc.’s operating partnership) and SIR Huffmeister Villas LLC on March 25, 2024.
Note 2 – Basis of Presentation
The
accompanying statement of revenues and certain operating expenses has been prepared for the purpose of complying with Rule 3-14
of Regulation S-X of the United States Securities and Exchange Commission promulgated under the Securities Act of 1933, as amended. Accordingly,
the statement is not representative of the actual operations for the period presented as revenues, and certain operating expenses, which
may not be directly attributable to the revenues and expenses expected to be incurred in the future operations of the Property, have been
excluded.
Use of Estimates
The preparation of the financial
statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires management
to make estimates and assumptions that affect the reporting and disclosure of revenues and certain expenses during the reporting period
to present the statement of revenues and certain operating expenses. Actual results could differ from those estimates.
Note 3 – Revenues
The
Property is located in Houston, Texas and contains 294 residential units that are rented to tenants under various lease agreements that
are generally one year in length. All leases are accounted for as operating leases. The Property recognizes rental revenue on a
straight-line basis over the terms of the rental agreements and in accordance with ASC Topic 842 Leases. Rental revenue is
recognized on an accrual basis and when the collectability of the amounts due from tenants is deemed probable. Rental revenue is included
within rental and other property revenues on the Property’s statement of revenues and certain operating expenses.
Tenant reimbursements for
common area maintenance and other recoverable expenses, such as pet, administrative, application and other fees, are recognized when the
services are provided and the performance obligations are satisfied. Tenant reimbursements are included within rental and other property
revenues on the Property’s statement of revenues and certain operating expenses.
Note 4 – Certain Operating Expenses
Certain
operating expenses include only those costs expected to be comparable to the proposed future operations of the Property. Property
operating expenses include administrative, repairs and maintenance, marketing, payroll, utilities, taxes, and insurance. Expenses such
as depreciation, amortization, and interest are excluded.
Note 5 – Commitments and Contingencies
The Property is subject to
various legal actions and claims arising in the ordinary course of business. Although the outcome of any legal matter cannot be predicted
with certainty, management does not believe that any of these legal proceedings or matters will have a material adverse effect on the
financial position or results of operations or liquidity of the Property.
Note 6 – Subsequent Events
The Property evaluated subsequent
events through November 14, 2024, the date the financial statements were available to be issued.
BLUEROCK HOMES TRUST, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL
STATEMENTS INFORMATION
The following unaudited pro
forma condensed consolidated financial statements of Bluerock Homes Trust, Inc. (together with its consolidated subsidiaries, the “Company,”
“we,” “our” or “us”) should be read in conjunction with our historical audited consolidated financial
statements as of and for the year ended December 31, 2023, and the related notes thereto.
The unaudited pro forma condensed
consolidated balance sheet as of December 31, 2023, and unaudited pro forma condensed consolidated statement of operations for the year
ended December 31, 2023, have been prepared to provide pro forma financial information with regard to the Villas at Huffmeister acquisition
on March 25, 2024, which the Company expects to consolidate.
The pro forma condensed consolidated
balance sheet at December 31, 2023 assumes that the Villas at Huffmeister acquisition referred to above occurred on January 1, 2023.
The pro forma condensed consolidated
statement of operations assume the transaction referred to above occurred on January 1, 2023.
Our pro forma financial information
is not necessarily indicative of what our actual financial position and results of operations would have been as of the date and for the
periods indicated, nor does it purport to represent our future financial position or results of operations.
All completed acquisitions
are accounted for as asset acquisitions. The purchase prices were allocated to the acquired assets and assumed liabilities based on their
estimated fair values at the dates of acquisition.
These unaudited pro forma
condensed consolidated financial statements are prepared for informational purposes only. In management’s opinion, all material
adjustments necessary to reflect the effects of the transactions referred to above have been made. Our unaudited pro forma condensed consolidated
financial statements are based on assumptions and estimates considered appropriate by the Company’s management. However, they are
not necessarily indicative of what our consolidated financial condition or results of operations would have been assuming the transactions
referred to above had occurred as of the dates indicated, nor do they purport to represent our consolidated financial position or results
of operations for future periods.
BLUEROCK HOMES TRUST, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE
SHEET
AS OF DECEMBER 31, 2023
(In thousands, except share and per share amounts)
|
|
|
|
|
Pro Forma Adjustments |
|
|
|
|
|
|
Bluerock Homes Trust, Inc.
Historical
(a) |
|
|
Villas at Huffmeister
(b) |
|
|
Pro Forma Total |
|
ASSETS |
|
|
|
|
|
|
|
|
|
|
|
|
Net Real Estate Investments |
|
|
|
|
|
|
|
|
|
|
|
|
Land |
|
$ |
70,637 |
|
|
$ |
7,950 |
|
|
$ |
78,587 |
|
Buildings and improvements |
|
|
394,548 |
|
|
|
32,198 |
|
|
|
426,746 |
|
Furniture, fixtures and equipment |
|
|
13,277 |
|
|
|
620 |
|
|
|
13,897 |
|
Total Gross Operating Real Estate Investments |
|
|
478,462 |
|
|
|
40,768 |
|
|
|
519,230 |
|
Accumulated depreciation |
|
|
(32,452 |
) |
|
|
— |
|
|
|
(32,452 |
) |
Total Net Operating Real Estate Investments |
|
|
446,010 |
|
|
|
40,768 |
|
|
|
486,778 |
|
Operating real estate held for sale, net |
|
|
18,890 |
|
|
|
— |
|
|
|
18,890 |
|
Total Net Real Estate Investments |
|
|
464,900 |
|
|
|
40,768 |
|
|
|
505,668 |
|
Cash and cash equivalents |
|
|
80,163 |
|
|
|
(16,959 |
) |
|
|
63,204 |
|
Restricted cash |
|
|
6,221 |
|
|
|
— |
|
|
|
6,221 |
|
Notes and accrued interest receivable, net |
|
|
17,797 |
|
|
|
— |
|
|
|
17,797 |
|
Accounts receivable, prepaids and other assets, net |
|
|
21,383 |
|
|
|
— |
|
|
|
21,383 |
|
Preferred equity investments, net |
|
|
81,156 |
|
|
|
— |
|
|
|
81,156 |
|
In-place lease intangible assets, net |
|
|
— |
|
|
|
1,018 |
|
|
|
1,018 |
|
TOTAL ASSETS |
|
$ |
671,620 |
|
|
$ |
24,827 |
|
|
$ |
696,447 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
LIABILITIES AND EQUITY |
|
|
|
|
|
|
|
|
|
|
|
|
Mortgages payable |
|
$ |
96,670 |
|
|
$ |
23,935 |
|
|
$ |
120,605 |
|
Revolving credit facilities |
|
|
70,000 |
|
|
|
— |
|
|
|
70,000 |
|
Accounts payable |
|
|
691 |
|
|
|
— |
|
|
|
691 |
|
Other accrued liabilities |
|
|
9,438 |
|
|
|
— |
|
|
|
9,438 |
|
Due to affiliates |
|
|
3,509 |
|
|
|
— |
|
|
|
3,509 |
|
Distributions payable |
|
|
12,440 |
|
|
|
— |
|
|
|
12,440 |
|
Total Liabilities |
|
|
192,748 |
|
|
|
23,935 |
|
|
|
216,683 |
|
6.0% Series A Redeemable Preferred Stock, liquidation preference $25.00 per share, 30,000,000
shares authorized; 436,675 shares issued and outstanding at December 31, 2023 |
|
|
8,273 |
|
|
|
— |
|
|
|
8,273 |
|
Equity |
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders’ Equity |
|
|
|
|
|
|
|
|
|
|
|
|
Preferred stock, $0.01 par value, 220,000,000 shares authorized; no shares issued and outstanding
at December 31, 2023 |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Common stock - Class A, $0.01 par value, 562,500,000 shares authorized; 3,871,265 shares
issued and outstanding at December 31, 2023, historical and pro forma |
|
|
39 |
|
|
|
— |
|
|
|
39 |
|
Common stock - Class C, $0.01 par value, 187,500,000 shares authorized; 8,489 shares issued
and outstanding at December 31, 2023, historical and pro forma |
|
|
— |
|
|
|
— |
|
|
|
— |
|
Additional paid-in-capital |
|
|
122,369 |
|
|
|
— |
|
|
|
122,369 |
|
Retained earnings |
|
|
24,943 |
|
|
|
— |
|
|
|
24,943 |
|
Total Stockholders’ Equity |
|
|
147,351 |
|
|
|
— |
|
|
|
147,351 |
|
Noncontrolling Interests |
|
|
|
|
|
|
|
|
|
|
|
|
Operating partnership units |
|
|
307,945 |
|
|
|
— |
|
|
|
307,945 |
|
Partially owned properties |
|
|
15,303 |
|
|
|
892 |
|
|
|
16,195 |
|
Total Noncontrolling Interests |
|
|
323,248 |
|
|
|
892 |
|
|
|
324,140 |
|
Total Equity |
|
|
470,599 |
|
|
|
892 |
|
|
|
471,491 |
|
TOTAL LIABILITIES AND EQUITY |
|
$ |
671,620 |
|
|
$ |
24,827 |
|
|
$ |
696,447 |
|
See Notes to Unaudited Pro Forma Condensed Consolidated
Balance Sheet
BLUEROCK HOMES TRUST, INC.
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
BALANCE SHEET
AS OF DECEMBER 31, 2023
(a) |
Historical consolidated financial information derived from the Company’s
Annual Report on Form 10-K as of December 31, 2023. |
|
|
(b) |
The purchase of a 95% direct interest in Villas at Huffmeister for a purchase
price of $41.2 million, inclusive of a $3.1 million fair value reduction related to assumed debt, which the Company consolidated on its
balance sheet. The Company also assumed a $27.4 million mortgage loan associated with this acquisition. The carrying value of the loan
includes ($3.1) million of a fair value debt adjustment and ($0.4) million of deferred financing costs related to this acquisition. |
BLUEROCK HOMES TRUST, INC.
UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT
OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2023
(In thousands, except share and per share amounts)
|
|
|
|
|
Pro Forma
Adjustments |
|
|
|
|
|
|
Bluerock Homes Trust, Inc.
Historical
(a) |
|
|
Villas at
Huffmeister
(b) |
|
|
Pro Forma
Total |
|
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Rental and other property revenues |
|
$ |
40,999 |
|
|
$ |
5,516 |
|
|
$ |
46,515 |
|
Interest income from loan investments |
|
|
94 |
|
|
|
— |
|
|
|
94 |
|
Total revenues |
|
|
41,093 |
|
|
|
5,516 |
|
|
|
46,609 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Property operating |
|
|
19,164 |
|
|
|
2,594 |
|
|
|
21,758 |
|
Property management and asset management fees |
|
|
4,416 |
|
|
|
143 |
(c) |
|
|
4,559 |
|
General and administrative |
|
|
8,004 |
|
|
|
— |
|
|
|
8,004 |
|
Management fees to related party |
|
|
7,922 |
|
|
|
— |
|
|
|
7,922 |
|
Acquisition and other transaction costs |
|
|
1,820 |
|
|
|
— |
|
|
|
1,820 |
|
Weather-related losses, net |
|
|
(17 |
) |
|
|
— |
|
|
|
(17 |
) |
Depreciation and amortization |
|
|
16,178 |
|
|
|
2,238 |
(d) |
|
|
18,416 |
|
Total expenses |
|
|
57,487 |
|
|
|
4,975 |
|
|
|
62,462 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
Other income, net |
|
|
679 |
|
|
|
— |
|
|
|
679 |
|
Income from preferred equity investments |
|
|
11,632 |
|
|
|
— |
|
|
|
11,632 |
|
Provision for credit losses, net |
|
|
(174 |
) |
|
|
— |
|
|
|
(174 |
) |
Impairment of real estate investments, net |
|
|
(1,017 |
) |
|
|
— |
|
|
|
(1,017 |
) |
Interest expense, net |
|
|
(13,102 |
) |
|
|
(1,618 |
)(e) |
|
|
(14,720 |
) |
Interest income |
|
|
2,609 |
|
|
|
— |
|
|
|
2,609 |
|
Total other income (expense) |
|
|
627 |
|
|
|
(1,618 |
) |
|
|
(991 |
) |
Net loss |
|
|
(15,767 |
) |
|
|
(1,077 |
) |
|
|
(16,844 |
) |
Preferred stock dividends |
|
|
(130 |
) |
|
|
— |
|
|
|
(130 |
) |
Net loss attributable to noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
Operating partnership units |
|
|
(8,996 |
) |
|
|
(682 |
) |
|
|
(9,678 |
) |
Partially owned properties |
|
|
(2,398 |
) |
|
|
(54 |
) |
|
|
(2,452 |
) |
Net loss attributable to noncontrolling interests |
|
|
(11,394 |
) |
|
|
(736 |
) |
|
|
(12,130 |
) |
Net loss attributable to common stockholders |
|
$ |
(4,503 |
) |
|
$ |
(341 |
) |
|
$ |
(4,844 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Loss per common share (f) |
|
|
|
|
|
|
|
|
|
|
|
|
Net loss per common share – Basic |
|
$ |
(1.30 |
) |
|
|
|
|
|
$ |
(1.11 |
) |
Net loss per common share – Diluted |
|
$ |
(1.30 |
) |
|
|
|
|
|
$ |
(1.11 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average basic common shares outstanding |
|
|
3,845,349 |
|
|
|
|
|
|
|
3,845,349 |
|
Weighted average diluted common shares outstanding |
|
|
3,845,349 |
|
|
|
|
|
|
|
3,845,349 |
|
See Notes to Unaudited Pro Forma Condensed Consolidated
Statement of Operations
BLUEROCK HOMES TRUST, INC.
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
FOR THE YEAR ENDED DECEMBER 31, 2023
(a) |
Historical consolidated
financial information derived from the Company’s Annual Report on Form 10-K as of December 31, 2023. |
|
|
(b) |
Represents adjustments to historical
operations of the Company to give effect to the purchase of Villas at Huffmeister on March 25, 2024 as if these assets had been acquired
on January 1, 2023. Adjustments were derived directly from the property’s actual results of operations, including pro forma adjustments
for the year ended December 31, 2023. Pro forma adjustments to historical results included: increasing property management and asset management
fees $0.14 million, increasing depreciation and amortization $2.24 million, increasing interest expense $1.62 million, and adjusting the
operating partnership units’ interest in the consolidated property’s net loss. |
|
|
(c) |
Represents property management and
asset management fees estimated to have been incurred for Villas at Huffmeister. Property management and asset management fees are calculated
as 2.75% of property revenues less certain adjustments, as applicable, per the property management agreement. |
|
|
(d) |
Represents depreciation and amortization
expense adjustment to historical results for the year ended December 31, 2023 based on the allocation of the purchase price. Depreciation
expense is calculated using the straight-line method over the asset’s estimated useful life as follows: 30-40 years for the building,
5-15 years for building and land improvements, and 3-8 years for furniture, fixtures and equipment. Amortization expense relates to the
Company’s identifiable intangible assets and consists of the value of in-place leases. In-place leases are amortized using the straight-line
method over the remaining non-cancelable term of the respective leases, which is on average six months. |
|
|
(e) |
Represents interest expense for
the Villas at Huffmeister acquisition estimated to have been incurred on the $27.4 million mortgage loan, which bears a fixed interest
rate of 3.56% and matures on October 1, 2029, calculated as if the loan was entered into on January 1, 2023, and a fair value adjustment
and deferred financing costs which are recognized at acquisition and amortized using the straight-line method over the remaining life
of the loan. The mortgage balance assumed in the pro forma balance sheet is presented at fair value less unamortized deferred financing
costs. |
|
|
(f) |
Earnings per share is calculated
in accordance with Accounting Standards Codification 260 – “Earnings per Share.” The historical earnings per share amounts
are the amounts reported in the Registrant’s Form 10-K for the year ended December 31, 2023. |
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
|
|
BLUEROCK HOMES
TRUST, INC. |
|
|
|
|
DATE: |
November 14, 2024 |
By: |
/s/ Christopher J. Vohs |
|
|
|
Christopher J. Vohs |
|
|
|
Chief Financial Officer and Treasurer |
Exhibit Index
Exhibit No. |
|
Exhibit |
|
|
|
23.1 |
|
Consent of Plante Moran, PC |
Exhibit 23.1
CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM
We consent to the incorporation by reference in
the Registration Statements on Form S-8 (File No. 333-267764) and Form S-11 (File No. 333-269415) of Bluerock Homes Trust, Inc. (each,
a “Registration Statement”), and the accompanying prospectuses to each Registration Statement, of our report dated November
14, 2024, relating to the statement of revenues and certain operating expenses of Villas at Huffmeister for the year ended December 31,
2023, which appears in this Form 8-K.
/s/ PLANTE MORAN, PC
East Lansing, Michigan
November 14, 2024
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 September 30, 2024
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 001-41322
BLUEROCK
HOMES TRUST, INC.
(Exact name of registrant
as specified in its charter)
|
|
|
Maryland |
|
87-4211187 |
(State or other jurisdiction
of incorporation or organization) |
|
(I.R.S. Employer
Identification No.) |
|
|
|
1345
Avenue of the Americas, 32nd Floor, New York, NY |
|
10105 |
(Address of principal
executive offices) |
|
(Zip Code) |
(212)
843-1601
(Registrant’s
telephone number, including area code)
Securities
registered pursuant to Section 12(b) of the Exchange Act:
Title
of each class |
|
Trading
Symbol |
|
Name
of each exchange on which registered |
Class A Common
Stock, $0.01 par value per share |
|
BHM |
|
NYSE American |
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 ☒
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 ☒ 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 |
☒ |
Smaller reporting company |
☐ |
Emerging growth company |
☒ |
|
|
Indicate by check mark
whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No
☒
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. ☐
Number
of shares outstanding of the registrant’s
classes
of common stock, as of November 11, 2024
Class A
Common Stock: 3,953,919 shares
Class C
Common Stock: 8,489 shares
BLUEROCK HOMES
TRUST, INC.
FORM 10-Q
September
30, 2024
PART I –
FINANCIAL INFORMATION
Item 1.
Financial Statements
BLUEROCK HOMES
TRUST, INC.
CONSOLIDATED BALANCE
SHEETS
(In
thousands, except share and per share amounts)
|
|
|
|
|
|
|
|
|
(Unaudited) |
|
|
|
|
|
September 30, |
|
December 31, |
|
|
2024 |
|
2023 |
ASSETS |
|
|
|
|
|
|
Net
Real Estate Investments |
|
|
|
|
|
|
Land |
|
$ |
78,342 |
|
$ |
70,637 |
Buildings
and improvements |
|
|
414,880 |
|
|
394,548 |
Furniture,
fixtures and equipment |
|
|
15,806 |
|
|
13,277 |
Total
Gross Operating Real Estate Investments |
|
|
509,028 |
|
|
478,462 |
Accumulated
depreciation |
|
|
(38,410) |
|
|
(32,452) |
Total
Net Operating Real Estate Investments |
|
|
470,618 |
|
|
446,010 |
Operating
real estate held for sale, net |
|
|
26,507 |
|
|
18,890 |
Total
Net Real Estate Investments |
|
|
497,125 |
|
|
464,900 |
Cash
and cash equivalents |
|
|
155,131 |
|
|
80,163 |
Restricted
cash |
|
|
9,673 |
|
|
6,221 |
Notes
and accrued interest receivable, net |
|
|
34,711 |
|
|
17,797 |
Accounts
receivable, prepaids and other assets, net |
|
|
30,642 |
|
|
19,688 |
Preferred
equity investments, net |
|
|
72,971 |
|
|
82,851 |
In-place
lease intangible assets, net |
|
|
491 |
|
|
— |
Non-real
estate assets associated with operating real estate held for sale |
|
|
85 |
|
|
— |
TOTAL
ASSETS |
|
$ |
800,829 |
|
$ |
671,620 |
|
|
|
|
|
|
|
LIABILITIES
AND EQUITY |
|
|
|
|
|
|
Mortgages
payable |
|
$ |
122,529 |
|
$ |
96,670 |
Revolving
credit facilities |
|
|
105,000 |
|
|
70,000 |
Accounts
payable |
|
|
1,017 |
|
|
691 |
Other
accrued liabilities |
|
|
12,130 |
|
|
9,438 |
Due
to affiliates |
|
|
3,615 |
|
|
3,509 |
Distributions
payable |
|
|
548 |
|
|
12,440 |
Liabilities
associated with operating real estate held for sale |
|
|
519 |
|
|
— |
Total
Liabilities |
|
|
245,358 |
|
|
192,748 |
6.0%
Series A Redeemable Preferred Stock, liquidation preference $25.00 per share, 30,000,000 shares authorized; 3,889,446 and 436,675 shares
issued and outstanding at September 30, 2024 and December 31, 2023, respectively |
|
|
85,992 |
|
|
8,273 |
Equity |
|
|
|
|
|
|
Stockholders’
Equity |
|
|
|
|
|
|
Preferred
stock, $0.01 par value, 220,000,000 shares authorized; no shares issued and outstanding at September 30, 2024 and December 31, 2023 |
|
|
— |
|
|
— |
Common
stock - Class A, $0.01 par value, 562,500,000 shares authorized; 3,953,919 and 3,871,265 shares issued and outstanding at September 30,
2024 and December 31, 2023, respectively |
|
|
40 |
|
|
39 |
Common
stock - Class C, $0.01 par value, 187,500,000 shares authorized; 8,489 shares issued and outstanding at September 30, 2024 and December
31, 2023 |
|
|
— |
|
|
— |
Additional
paid-in-capital |
|
|
119,683 |
|
|
122,369 |
Retained
earnings |
|
|
23,212 |
|
|
24,943 |
Total
Stockholders’ Equity |
|
|
142,935 |
|
|
147,351 |
Noncontrolling
Interests |
|
|
|
|
|
|
Operating
partnership units |
|
|
312,780 |
|
|
307,945 |
Partially
owned properties |
|
|
13,764 |
|
|
15,303 |
Total
Noncontrolling Interests |
|
|
326,544 |
|
|
323,248 |
Total
Equity |
|
|
469,479 |
|
|
470,599 |
TOTAL
LIABILITIES AND EQUITY |
|
$ |
800,829 |
|
$ |
671,620 |
See Notes to
Consolidated Financial Statements
BLUEROCK HOMES
TRUST, INC.
CONSOLIDATED
STATEMENTS OF OPERATIONS (Unaudited)
(In
thousands, except share and per share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three
Months Ended |
|
Nine
Months Ended |
|
|
September
30, |
|
September
30, |
|
|
2024 |
|
2023 |
|
2024 |
|
2023 |
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
Rental
and other property revenues |
|
$ |
11,976 |
|
$ |
10,183 |
|
$ |
34,670 |
|
$ |
30,591 |
Interest
income from loan investments |
|
|
730 |
|
|
— |
|
|
1,735 |
|
|
— |
Total
revenues |
|
|
12,706 |
|
|
10,183 |
|
|
36,405 |
|
|
30,591 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
Property
operating |
|
|
6,434 |
|
|
5,094 |
|
|
17,391 |
|
|
14,233 |
Property
management and asset management fees |
|
|
1,181 |
|
|
1,113 |
|
|
3,472 |
|
|
3,308 |
General
and administrative |
|
|
2,451 |
|
|
1,675 |
|
|
7,756 |
|
|
5,464 |
Management
fees to related party |
|
|
2,377 |
|
|
1,993 |
|
|
6,621 |
|
|
5,875 |
Acquisition
and other transaction costs |
|
|
17 |
|
|
7 |
|
|
21 |
|
|
1,787 |
Weather-related
losses, net |
|
|
178 |
|
|
— |
|
|
178 |
|
|
(17) |
Depreciation
and amortization |
|
|
4,883 |
|
|
4,100 |
|
|
13,712 |
|
|
12,092 |
Total
expenses |
|
|
17,521 |
|
|
13,982 |
|
|
49,151 |
|
|
42,742 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Other
income (expense) |
|
|
|
|
|
|
|
|
|
|
|
|
Other
income (expense), net |
|
|
166 |
|
|
(165) |
|
|
106 |
|
|
(121) |
Income
from preferred equity investments |
|
|
2,721 |
|
|
2,959 |
|
|
8,308 |
|
|
8,649 |
Provision
for credit losses, net |
|
|
(48) |
|
|
(37) |
|
|
(214) |
|
|
(63) |
Gain
on sale and impairment of real estate investments, net |
|
|
9,304 |
|
|
— |
|
|
8,770 |
|
|
661 |
Loss
on extinguishment of debt costs |
|
|
(118) |
|
|
— |
|
|
(118) |
|
|
— |
Interest
expense, net |
|
|
(5,248) |
|
|
(3,499) |
|
|
(12,818) |
|
|
(8,715) |
Interest
income |
|
|
1,585 |
|
|
923 |
|
|
3,918 |
|
|
1,665 |
Total
other income |
|
|
8,362 |
|
|
181 |
|
|
7,952 |
|
|
2,076 |
Net
income (loss) |
|
|
3,547 |
|
|
(3,618) |
|
|
(4,794) |
|
|
(10,075) |
Preferred
stock dividends |
|
|
(1,412) |
|
|
(12) |
|
|
(2,227) |
|
|
(12) |
Preferred
stock accretion |
|
|
— |
|
|
— |
|
|
(181) |
|
|
— |
Net
income (loss) attributable to noncontrolling interests |
|
|
|
|
|
|
|
|
|
|
|
|
Operating
partnership units |
|
|
2,010 |
|
|
(2,142) |
|
|
(3,695) |
|
|
(5,780) |
Partially
owned properties |
|
|
(796) |
|
|
(420) |
|
|
(1,776) |
|
|
(1,364) |
Net
income (loss) attributable to noncontrolling interests |
|
|
1,214 |
|
|
(2,562) |
|
|
(5,471) |
|
|
(7,144) |
Net
income (loss) attributable to common stockholders |
|
$ |
921 |
|
$ |
(1,068) |
|
$ |
(1,731) |
|
$ |
(2,943) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) per common share – Basic |
|
$ |
0.24 |
|
$ |
(0.28) |
|
$ |
(0.45) |
|
$ |
(0.77) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
income (loss) per common share – Diluted |
|
$ |
0.24 |
|
$ |
(0.28) |
|
$ |
(0.45) |
|
$ |
(0.77) |
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted
average basic common shares outstanding |
|
|
3,859,226 |
|
|
3,845,926 |
|
|
3,853,321 |
|
|
3,844,488 |
Weighted
average diluted common shares outstanding |
|
|
3,871,201 |
|
|
3,845,926 |
|
|
3,853,321 |
|
|
3,844,488 |
See Notes to Consolidated Financial Statements
BLUEROCK
HOMES TRUST, INC.
FOR
THE THREE MONTHS ENDED SEPTEMBER 30, 2024
CONSOLIDATED
STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited)
(In
thousands, except share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class
A Common Stock |
|
Class
C Common Stock |
|
Additional
|
|
|
|
|
|
|
|
|
|
|
|
Number |
|
|
|
|
Number |
|
|
|
|
Paid-in |
|
Retained
|
|
Noncontrolling |
|
|
|
|
|
of
Shares |
|
Par
Value |
|
of
Shares |
|
Par
Value |
|
Capital |
|
Earnings |
|
Interests |
|
Total Equity |
Balance,
July 1, 2024 |
|
3,946,348 |
|
$ |
39 |
|
8,489 |
|
$ |
— |
|
$ |
120,198 |
|
$ |
22,291 |
|
$ |
325,551 |
|
$ |
468,079 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of restricted Class A common stock and long-term incentive plan (“LTIP”) Units for equity incentive plan compensation, net
of shares withheld for employee taxes |
|
(186) |
|
|
— |
|
— |
|
|
— |
|
|
153 |
|
|
— |
|
|
727 |
|
|
880 |
Issuance
of C-LTIP Units to Manager |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
1,086 |
|
|
1,086 |
Series
A Preferred Stock distributions declared |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(1,412) |
|
|
— |
|
|
(1,412) |
Distributions
to partially owned properties’ noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(18) |
|
|
(18) |
Acquisition
of noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
(2,211) |
|
|
— |
|
|
(650) |
|
|
(2,861) |
Holder
redemption of Series A Preferred Stock and conversion into Class A common stock |
|
7,757 |
|
|
1 |
|
— |
|
|
— |
|
|
139 |
|
|
— |
|
|
— |
|
|
140 |
Contributions
from noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
38 |
|
|
38 |
Adjustment
for noncontrolling interest ownership in the Operating Partnership |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
1,404 |
|
|
— |
|
|
(1,404) |
|
|
— |
Net
income |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
2,333 |
|
|
1,214 |
|
|
3,547 |
Balance,
September 30, 2024 |
|
3,953,919 |
|
$ |
40 |
|
8,489 |
|
$ |
— |
|
$ |
119,683 |
|
$ |
23,212 |
|
$ |
326,544 |
|
$ |
469,479 |
See Notes to Consolidated
Financial Statements
BLUEROCK HOMES
TRUST, INC.
FOR
THE THREE MONTHS ENDED SEPTEMBER 30, 2023
CONSOLIDATED
STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited)
(In
thousands, except share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class
A Common Stock |
|
Class
C Common Stock |
|
Additional |
|
|
|
|
|
|
|
|
|
|
|
Number |
|
|
|
Number |
|
|
|
Paid-in |
|
Retained |
|
Noncontrolling |
|
|
|
|
|
of
Shares |
|
Par
Value |
|
of
Shares |
|
Par
Value |
|
Capital |
|
Earnings |
|
Interests |
|
Total
Equity |
Balance,
July 1, 2023 |
|
3,868,697 |
|
$ |
39 |
|
8,489 |
|
$ |
— |
|
$ |
125,666 |
|
$ |
31,450 |
|
$ |
329,081 |
|
$ |
486,236 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of restricted Class A common stock and LTIP Units for equity incentive plan compensation |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
47 |
|
|
— |
|
|
667 |
|
|
714 |
Issuance
of C-LTIP Units to Manager |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
2,347 |
|
|
2,347 |
Series
A Preferred Stock distributions declared |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(12) |
|
|
— |
|
|
(12) |
Distributions
to partially owned properties’ noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(34) |
|
|
(34) |
Adjustment
for noncontrolling interest ownership in the Operating Partnership |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
(1,056) |
|
|
— |
|
|
1,056 |
|
|
— |
Net
loss |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(1,056) |
|
|
(2,562) |
|
|
(3,618) |
Balance,
September 30, 2023 |
|
3,868,697 |
|
$ |
39 |
|
8,489 |
|
$ |
— |
|
$ |
124,657 |
|
$ |
30,382 |
|
$ |
330,555 |
|
$ |
485,633 |
See Notes to Consolidated
Financial Statements
BLUEROCK
HOMES TRUST, INC.
FOR
THE NINE MONTHS ENDED SEPTEMBER 30, 2024
CONSOLIDATED
STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited)
(In
thousands, except share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class
A Common Stock |
|
Class
C Common Stock |
|
Additional
|
|
|
|
|
|
|
|
|
|
|
|
Number |
|
|
|
|
Number |
|
|
|
|
Paid-in |
|
Retained
|
|
Noncontrolling |
|
|
|
|
|
of Shares |
|
Par
Value |
|
of Shares |
|
Par
Value |
|
Capital |
|
Earnings |
|
Interests |
|
Total Equity |
Balance,
January 1, 2024 |
|
3,871,265 |
|
$ |
39 |
|
8,489 |
|
$ |
— |
|
$ |
122,369 |
|
$ |
24,943 |
|
$ |
323,248 |
|
$ |
470,599 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of restricted Class A common stock and LTIP Units for equity incentive plan compensation, net of shares withheld for employee taxes |
|
73,551 |
|
|
— |
|
— |
|
|
— |
|
|
297 |
|
|
— |
|
|
2,139 |
|
|
2,436 |
Issuance
of C-LTIP Units to Manager |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
5,455 |
|
|
5,455 |
Series
A Preferred Stock distributions declared |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(2,227) |
|
|
— |
|
|
(2,227) |
Series
A Preferred Stock accretion |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(181) |
|
|
— |
|
|
(181) |
Distributions
to partially owned properties’ noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(104) |
|
|
(104) |
Acquisition
of noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
(2,211) |
|
|
— |
|
|
(650) |
|
|
(2,861) |
Holder
redemption of Series A Preferred Stock and conversion into Class A common stock |
|
9,103 |
|
|
1 |
|
— |
|
|
— |
|
|
164 |
|
|
— |
|
|
— |
|
|
165 |
Contributions
from noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
991 |
|
|
991 |
Adjustment
for noncontrolling interest ownership in the Operating Partnership |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
(936) |
|
|
— |
|
|
936 |
|
|
— |
Net
income (loss) |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
677 |
|
|
(5,471) |
|
|
(4,794) |
Balance,
September 30, 2024 |
|
3,953,919 |
|
$ |
40 |
|
8,489 |
|
$ |
— |
|
$ |
119,683 |
|
$ |
23,212 |
|
$ |
326,544 |
|
$ |
469,479 |
See Notes to Consolidated Financial
Statements
BLUEROCK
HOMES TRUST, INC.
FOR
THE NINE MONTHS ENDED SEPTEMBER 30, 2023
CONSOLIDATED
STATEMENT OF STOCKHOLDERS’ EQUITY (Unaudited)
(In
thousands, except share amounts)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Class
A Common Stock |
|
Class
C Common Stock |
|
Additional |
|
|
|
|
|
|
|
|
|
|
|
Number |
|
|
|
Number |
|
|
|
Paid-in |
|
Retained |
|
Noncontrolling |
|
|
|
|
|
of Shares |
|
Par
Value |
|
of Shares |
|
Par
Value |
|
Capital |
|
Earnings |
|
Interests |
|
Total
Equity |
Balance,
January 1, 2023 |
|
3,835,013 |
|
$ |
38 |
|
8,489 |
|
$ |
— |
|
$ |
126,623 |
|
$ |
33,325 |
|
$ |
332,002 |
|
$ |
491,988 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Issuance
of restricted Class A common stock and LTIP Units for equity incentive plan compensation |
|
31,260 |
|
|
1 |
|
— |
|
|
— |
|
|
62 |
|
|
— |
|
|
1,935 |
|
|
1,998 |
Issuance
of C-LTIP Units to Manager |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
6,763 |
|
|
6,763 |
Series
A Preferred Stock distributions declared |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(12) |
|
|
— |
|
|
(12) |
Distributions
to partially owned properties’ noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
(230) |
|
|
(230) |
Acquisition
of noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
1,515 |
|
|
— |
|
|
(6,564) |
|
|
(5,049) |
Conversion
of Operating Partnership Units to Class A common stock |
|
2,424 |
|
|
— |
|
— |
|
|
— |
|
|
100 |
|
|
— |
|
|
(100) |
|
|
— |
Contributions
from noncontrolling interests |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
250 |
|
|
250 |
Adjustment
for noncontrolling interest ownership in the Operating Partnership |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
(3,643) |
|
|
— |
|
|
3,643 |
|
|
— |
Net
loss |
|
— |
|
|
— |
|
— |
|
|
— |
|
|
— |
|
|
(2,931) |
|
|
(7,144) |
|
|
(10,075) |
Balance,
September 30, 2023 |
|
3,868,697 |
|
$ |
39 |
|
8,489 |
|
$ |
— |
|
$ |
124,657 |
|
$ |
30,382 |
|
$ |
330,555 |
|
$ |
485,633 |
See Notes to Consolidated Financial
Statements
BLUEROCK HOMES
TRUST, INC.
CONSOLIDATED
STATEMENTS OF CASH FLOWS (Unaudited)
(In
thousands)
|
|
|
|
|
|
|
|
|
Nine
Months Ended |
|
|
September 30, |
|
|
2024 |
|
2023 |
Cash
flows from operating activities |
|
|
|
|
|
|
Net
loss |
|
$ |
(4,794) |
|
$ |
(10,075) |
Adjustments
to reconcile net loss to net cash provided by operating activities: |
|
|
|
|
|
|
Depreciation
and amortization |
|
|
14,780 |
|
|
14,277 |
Amortization
of fair value adjustments |
|
|
46 |
|
|
(240) |
Income
from preferred equity investments |
|
|
(8,308) |
|
|
(8,649) |
Gain
on sale and impairment of real estate investments, net |
|
|
(8,770) |
|
|
(661) |
Fair
value adjustment of interest rate caps and swaps |
|
|
3,444 |
|
|
1,336 |
Provision
for credit losses, net |
|
|
214 |
|
|
63 |
Loss
on extinguishment of debt |
|
|
118 |
|
|
— |
Distributions
of income and income from preferred equity investments |
|
|
2,092 |
|
|
1,290 |
Share-based
compensation attributable to equity incentive plan |
|
|
2,436 |
|
|
1,997 |
Share-based
compensation to Manager – C-LTIP Units |
|
|
5,455 |
|
|
6,763 |
Changes in operating
assets and liabilities: |
|
|
|
|
|
|
Due
to affiliates, net |
|
|
107 |
|
|
363 |
Accounts
receivable, prepaids and other assets |
|
|
(5,198) |
|
|
(837) |
Notes
and accrued interest receivable |
|
|
(742) |
|
|
— |
Accounts
payable and other accrued liabilities |
|
|
3,174 |
|
|
1,162 |
Net
cash provided by operating activities |
|
|
4,054 |
|
|
6,789 |
|
|
|
|
|
|
|
Cash
flows from investing activities: |
|
|
|
|
|
|
Acquisitions
of real estate investments |
|
|
(51,454) |
|
|
(4,330) |
Capital
expenditures |
|
|
(5,939) |
|
|
(7,201) |
Purchase
of interest rate cap |
|
|
(2,688) |
|
|
— |
Investments
in notes receivable |
|
|
(24,554) |
|
|
— |
Repayments
on notes receivable |
|
|
8,284 |
|
|
— |
Proceeds
from sale of real estate investments |
|
|
43,996 |
|
|
5,625 |
Proceeds
from redemption of preferred equity investments |
|
|
12,768 |
|
|
8,494 |
Insurance
proceeds related to real estate investments |
|
|
149 |
|
|
— |
Investments
in preferred equity investments |
|
|
(3,005) |
|
|
(7,528) |
Net
cash used in investing activities |
|
|
(22,443) |
|
|
(4,940) |
|
|
|
|
|
|
|
Cash
flows from financing activities: |
|
|
|
|
|
|
Distributions
to common stockholders |
|
|
(3,879) |
|
|
— |
Distributions
to noncontrolling interests |
|
|
(8,509) |
|
|
— |
Distributions
to partially owned properties’ noncontrolling interests |
|
|
(104) |
|
|
(230) |
Distributions
to preferred stockholders |
|
|
(1,731) |
|
|
— |
Contributions
from noncontrolling interests |
|
|
991 |
|
|
250 |
Purchase
of interests from noncontrolling interests |
|
|
(2,573) |
|
|
(5,049) |
Borrowings
on mortgages payable |
|
|
23,660 |
|
|
— |
Repayments
on mortgages payable including prepayment penalties |
|
|
(21,272) |
|
|
(1,124) |
Proceeds
from revolving credit facilities |
|
|
35,000 |
|
|
21,000 |
Repayments
on revolving credit facilities |
|
|
— |
|
|
(6,000) |
Payments
of deferred financing fees |
|
|
(1,504) |
|
|
(1,092) |
Net
proceeds from issuance of 6.0% Series A Redeemable Preferred Stock |
|
|
76,730 |
|
|
3,417 |
Net
cash provided by financing activities |
|
|
96,809 |
|
|
11,172 |
|
|
|
|
|
|
|
Net
increase in cash, cash equivalents and restricted cash |
|
$ |
78,420 |
|
$ |
13,021 |
Cash,
cash equivalents and restricted cash, beginning of year |
|
|
86,384 |
|
|
82,562 |
Cash,
cash equivalents and restricted cash, end of period |
|
$ |
164,804 |
|
$ |
95,583 |
|
|
|
|
|
|
|
Reconciliation
of cash, cash equivalents and restricted cash |
|
|
|
|
|
|
Cash
and cash equivalents |
|
$ |
155,131 |
|
$ |
89,435 |
Restricted
cash |
|
|
9,673 |
|
|
6,148 |
Total
cash, cash equivalents and restricted cash, end of period |
|
$ |
164,804 |
|
$ |
95,583 |
|
|
|
|
|
|
|
Supplemental
disclosure of cash flow information |
|
|
|
|
|
|
Cash
paid for interest (net of interest capitalized) |
|
$ |
7,984 |
|
$ |
5,272 |
|
|
|
|
|
|
|
Supplemental
disclosure of non-cash investing and financing activities |
|
|
|
|
|
|
Distributions
payable – declared and unpaid |
|
$ |
548 |
|
$ |
12 |
Mortgage
assumed upon property acquisition |
|
$ |
24,333 |
|
$ |
— |
Capital
expenditures held in accounts payable and other accrued liabilities |
|
$ |
276 |
|
$ |
883 |
See
Notes to Consolidated Financial Statements
BLUEROCK HOMES
TRUST, INC.
NOTES TO CONSOLIDATED
FINANCIAL STATEMENTS
Note 1 –
Organization and Nature of Business
Bluerock
Homes Trust, Inc. (the “Company”) was incorporated in Maryland on December 16, 2021. The Company owns and operates high-quality
single-family properties located in attractive markets with a focus on the knowledge-economy and high-quality of life growth markets of
the Sunbelt and Western United States. The Company’s principal objective is to generate attractive risk-adjusted returns on investments
where it believes it can drive growth in funds from operations and net asset value by acquiring pre-existing single-family residential
units, developing build-to-rent communities, and through Value-Add renovations. The Company’s Value-Add strategy focuses on repositioning
lower-quality, less current assets to drive rent growth and expand margins to increase net operating income and maximize the Company’s
return on investment.
As
of September 30, 2024, the Company held twenty real estate investments, consisting of twelve consolidated investments and eight preferred
equity and loan investments. The twenty investments represent an aggregate of 4,000 residential units, comprised of 2,742 consolidated
units, of which 170 units are under development, and 1,258 units through preferred equity and loan investments, which includes planned
units and those under development. As of September 30, 2024, the Company’s consolidated operating investments were approximately
90.5% occupied; excluding units classified as held for sale and down/renovation units, the Company’s consolidated operating investments
were approximately 94.3% occupied.
The
Company has elected to be treated, and currently qualifies, as a real estate investment trust (“REIT”) for federal income
tax purposes. As a REIT, the Company generally is not subject to corporate-level income taxes. To maintain its REIT status, the Company
is required, among other requirements, to distribute annually at least 90% of its “REIT taxable income,” as defined by the
Internal Revenue Code of 1986, as amended (the “Code”), to the Company’s stockholders. If the Company fails to qualify
as a REIT in any taxable year, it would be subject to federal income tax on its taxable income at regular corporate tax rates and it would
not be permitted to qualify as a REIT for four years following the year in which it lost its qualification. The Company intends to continue
to organize and operate in such a manner as to remain qualified as a REIT.
Note 2 –
Basis of Presentation and Summary of Significant Accounting Policies
Basis
of Presentation and Principles of Consolidation
The
Company conducts its operations through Bluerock Residential Holdings, L.P., its operating partnership (the “Operating Partnership”),
of which it is the sole general partner. The consolidated financial statements include the Company’s accounts and those of the Operating
Partnership and its subsidiaries. As of September 30, 2024, limited partners other than the Company owned approximately 69.29% of the
common units of the Operating Partnership, of which 57.09% is held by holders of limited partnership interest in the Operating Partnership
(“OP Units”) and 12.20% is held by holders of the Operating Partnership’s long-term incentive plan units (“LTIP
Units”), including 3.74% which are not vested as of September 30, 2024.
Certain
amounts in prior year financial statement presentation have been reclassified to conform to the current year presentation.
Real Estate Investments
and Preferred Equity Investments
The
Company first analyzes an investment to determine if it is a variable interest entity (“VIE”) in accordance with Financial
Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810: Consolidation
and, if so, whether the Company is the primary beneficiary requiring consolidation of the entity. A VIE is an entity that has (i) insufficient
equity to permit it to finance its activities without additional subordinated financial support or (ii) equity holders that lack
the characteristics of a controlling financial interest. VIEs are consolidated by the primary beneficiary, which is the entity that has
both the power to direct the activities that most significantly impact the entity’s economic performance and the obligation to absorb
losses or the right to receive benefits from the entity that potentially could be significant to the entity. Variable interests in a VIE
are contractual, ownership, or other financial interests in a VIE that change in value with changes in the fair value of the VIE’s
net assets. The Company continuously re-assesses at each level of the investment whether (i) the entity is a VIE, and (ii) the
Company is the primary beneficiary of the VIE. If it was determined that an entity in which the Company holds an interest qualified as
a VIE and the Company was the primary beneficiary, the entity would be consolidated.
If,
after consideration of the VIE accounting literature, the Company has determined that an entity is not a VIE, the Company assesses the
need for consolidation under all other provisions of ASC 810. These provisions provide for consolidation of majority-owned entities through
a majority voting interest held by the Company providing control.
In
assessing whether the Company is in control of and requiring consolidation of the limited liability company and partnership venture structures,
the Company evaluates the respective rights and privileges afforded each member or partner (collectively referred to as “member”).
The Company’s member would not be deemed to control the entity if any of the other members has either (i) substantive kickout
rights providing the ability to dissolve (liquidate) the entity or otherwise remove the managing member or general partner without cause
or (ii) substantive participating rights in the entity. Substantive participating rights (whether granted by contract or law) provide
for the ability to effectively participate in significant decisions of the entity that would be expected to be made in the ordinary course
of business.
The
Company analyzes each investment that involves real estate acquisition, development, and construction to consider whether the investment
qualifies as an investment in a real estate acquisition, development, and construction arrangement. The Company has evaluated its real
estate investments as required by ASC 310-10 Receivables and concluded that no investments are considered
an investment in a real estate acquisition, development, or construction arrangement. As such, the Company next evaluates if these investments
are considered a security under ASC 320 Investments – Debt Securities.
For
investments that meet the criteria of a security under ASC 320 Investments – Debt Securities,
except as noted regarding Note B of the Wayford at Pringle Loan Financing (refer to Note 6), the Company classifies each preferred equity
investment as a held-to-maturity debt security as the Company has the intention and ability to hold the investment to maturity. The Company
earns a fixed return on these investments which is included within income from preferred equity investments in its consolidated statements
of operations. The Company evaluates the collectability of each preferred equity investment and estimates a provision for credit loss,
as applicable. Refer to the Current Expected Credit Losses (“CECL”) section of this Note for further information regarding
CECL and the Company’s provision for credit losses. The Company accounts for these investments as preferred equity investments in
its consolidated balance sheets.
For
investments that do not meet the criteria of a security under ASC 320 Investments – Debt Securities,
the Company has concluded that the characteristics and the facts and circumstances indicate that loan accounting treatment is appropriate.
The Company recognizes interest income on its notes receivable on the accrual method unless a significant uncertainty of collection exists.
If a significant uncertainty exists, interest income is recognized as collected. Costs incurred to originate its notes receivable are
deferred and amortized using the effective interest method over the term of the related note receivable. The Company evaluates the collectability
of each loan investment and estimates a provision for credit loss, as applicable. Refer to the CECL section of this Note for further information
regarding CECL and the Company’s provision for credit losses.
Significant
Risks and Uncertainties
Uncertainty Due to
Economic Volatility
The
Company’s results of operations in the future may be directly or indirectly affected by uncertainties such as the effects of inflation
and related volatility in the market. As inflation accelerated rapidly in the first half of 2023, the Federal Reserve increased interest
rates a total of four times during 2023 to curb the effects of rising inflation. While the Federal Reserve held rates steady between July
2023 and September 2024 and reduced interest rates by 50-basis points in September 2024, there can be no assurances that interest rates
will not rise again, and the Company’s operating costs, including utilities and payroll, may increase as a result of increases in
inflation. Rising interest rates cause uncertainty in credit and capital markets which could have material and adverse effects on the
Company’s financial condition, results of operations and cash flows. The long-term impact of these economic developments will largely
depend on any future action by the Federal Reserve, future laws that may be enacted, the impact on job growth and the broader economy,
and reactions by consumers, companies, governmental entities and capital markets. The Company continues to closely monitor the impact
of economic volatility on all aspects of its business.
Summary
of Significant Accounting Policies
Refer
to the Company’s Annual Report on Form 10-K for the year ended December 31, 2023 as filed with the Securities and Exchange Commission
(“SEC”) on March 12, 2024 for discussion of the Company’s significant accounting policies. During the nine months ended
September 30, 2024, there were no material changes to these policies.
Interim Financial Information
The
accompanying unaudited consolidated financial statements of the Company have been prepared in accordance with accounting principles generally
accepted in the Unites States of America (“GAAP”) for interim financial reporting, and the instructions to Form 10-Q and Article
10-1 of Regulation S-X. Accordingly, the financial statements for interim reporting do not include all the information and notes or disclosures
required by GAAP for complete financial statements. In the opinion of management, all adjustments (consisting of normal recurring items)
considered necessary for a fair presentation have been included. Operating results for interim periods should not be considered indicative
of the operating results for a full year.
The
balance sheet at December 31, 2023 has been derived from the audited financial statements at that date but does not include all the information
and disclosures required by GAAP for complete financial statements. It is suggested that these condensed financial statements be read
in conjunction with the financial statements and notes thereto included in the Company’s audited consolidated financial statements
for the year ended December 31, 2023 contained in the Annual Report on Form 10-K as filed with the SEC on March 12, 2024.
Use of Estimates
The
preparation of the financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the
reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements
and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.
New Accounting Pronouncements