UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 10-Q

(Mark One)

 

x

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

 

For the Quarterly period ended  September 30, 2019

 

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 1-7865

 

HMG/COURTLAND PROPERTIES, INC.

(Exact name of small business issuer as specified in its charter)

 

Delaware

 

59-1914299

(State or other jurisdiction of

 

(I.R.S. Employer

incorporation or organization)

 

Identification No.)

 

1870 S. Bayshore Drive,
Coconut Grove,
Florida

 

33133

(Address of principal executive offices)

 

(Zip Code)

 

305-854-6803

(Registrant's telephone number, including area code)

 

Not Applicable

(Former name, former address and former fiscal year, if changed since last report)

 

Indicate by check mark whether the issuer (1) has filed all reports required to be filed by Sections 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 x  No ¨

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted 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 and post such files).
Yes
x  No ¨

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, 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 x

 

 

 

 

Emerging growth company ¨

 

 

 

 

(Do not check if a smaller reporting company)

 

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the exchange Act).   Yes ¨  No x

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Common Stock - Par value $1.00 per share

 

HMG

 

NYSE

 

APPLICABLE ONLY TO CORPORATE ISSUERS:

 

State the number of shares outstanding of each of the issuer's classes of common equity, as of the latest practicable date.  1,013,292 Common shares were outstanding as of November 13, 2019. 

 
 
  
 
 

 

HMG/COURTLAND PROPERTIES, INC.

 

Index

 

 

 

PAGE

 

 

NUMBER

PART I.

Condensed Consolidated Financial Information

 

 

 

 

 

Item 1.  Financial Statements

 

 

 

 

 

Condensed Consolidated Balance Sheets as of September 30, 2019 (Unaudited) and December 31, 2018

1

 

 

 

 

Condensed Consolidated Statements of Income for the Three and Nine Months Ended September 30, 2019 and 2018 (Unaudited)

2

 

 

 

 

Condensed Consolidated Statements of Changes in Stockholder’s Equity for the Three and Nine Months Ended September 30, 2019 and 2018 (Unaudited)

3

 

 

 

 

Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2019 and 2018 (Unaudited)

4

 

 

 

 

Notes to Condensed Consolidated Financial Statements (Unaudited)

5

 

 

 

 

Item 2.  Management's Discussion and Analysis of Financial Condition and Results of Operations

11

 

 

 

 

Item 3.  Quantitative and Qualitative Disclosures About Market Risk

12

 

 

 

 

Item 4.  Controls and Procedures

12

 

 

 

PART II.

Other Information

 

 

Item 1.  Legal Proceedings

12

 

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

12

 

Item 3.   Defaults Upon Senior Securities

12

 

Item 4.  Mine Safety Disclosures

12

 

Item 5.  Other Information

12

 

Item 6.  Exhibits

12

Signatures

13

 

Cautionary Statement.  This Form 10-Q contains certain statements relating to future results of the Company that are considered "forward-looking statements" within the meaning of the Private Litigation Reform Act of 1995.  Actual results may differ materially from those expressed or implied as a result of certain risks and uncertainties, including, but not limited to, changes in political and economic conditions; interest rate fluctuation; competitive pricing pressures within the Company's market; equity and fixed income market fluctuation; technological change; changes in law; changes in fiscal, monetary, regulatory and tax policies; monetary fluctuations as well as other risks and uncertainties detailed elsewhere in this Form 10-Q or from time-to-time in the filings of the Company with the Securities and Exchange Commission.  Such forward-looking statements speak only as of the date on which such statements are made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement is made or to reflect the occurrence of unanticipated events. 

 

 

 

HMG/COURTLAND PROPERTIES, INC.  AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

 

 

 

 

 

 

 

 

 

September 30,

 

 

December 31,

 

 

 

2019

 

 

2018

 

 

 

(UNAUDITED)

 

 

 

 

Investment properties, net of accumulated depreciation:

 

 

 

 

 

 

 

 

Office building and other commercial property

 

$

929,812

 

 

$

875,198

 

Total investment properties, net

 

 

929,812

 

 

 

875,198

 

 

 

 

 

 

 

 

 

 

Cash and cash equivalents

 

 

16,237,134

 

 

 

19,738,174

 

Investments in marketable securities

 

 

3,491,531

 

 

 

3,075,718

 

Other investments

 

 

5,919,222

 

 

 

6,039,456

 

Investment in affiliate

 

 

1,437,632

 

 

 

1,637,985

 

Loans, notes and other receivables

 

 

1,799,055

 

 

 

1,796,926

 

Investment in residential real estate partnership

 

 

3,203,225

 

 

 

200,000

 

Other assets

 

 

72,779

 

 

 

73,477

 

TOTAL ASSETS

 

$

33,090,390

 

 

$

33,436,934

 

 

 

 

 

 

 

 

 

 

LIABILITIES

 

 

 

 

 

 

 

 

Margin payable

 

$

9,926,672

 

 

$

9,857,918

 

Dividends payable

 

 

-

 

 

 

506,646

 

Accounts payable, accrued expenses and other liabilities

 

 

407,256

 

 

 

370,632

 

Amounts due to Adviser

 

 

64,356

 

 

 

40,426

 

Note payable to affiliate

 

 

1,000,000

 

 

 

1,340,000

 

Deferred income taxes payable

 

 

63,338

 

 

 

47,888

 

TOTAL LIABILITIES

 

 

11,461,622

 

 

 

12,163,510

 

 

 

 

 

 

 

 

 

 

STOCKHOLDERS' EQUITY

 

 

 

 

 

 

 

 

Excess common stock, $1 par value; 100,000 shares authorized: no shares issued

 

 

-

 

 

 

-

 

Common stock, $1 par value; 1,050,000 shares authorized, 1,013,292 issued as of September 30, 2019 and 1,046,393 shares issued as of December 31, 2018

 

 

1,013,292

 

 

 

1,046,393

 

Additional paid-in capital

 

 

23,859,686

 

 

 

24,157,986

 

Less: Treasury shares at cost 33,101 shares

 

 

-

 

 

 

(340,281

)

Undistributed gains from sales of properties, net of losses

 

 

54,642,764

 

 

 

54,642,764

 

Undistributed losses from operations

 

 

(58,136,652

)

 

 

(58,473,807

)

Total stockholders' equity

 

 

21,379,090

 

 

 

21,033,055

 

Noncontrolling interest

 

 

249,678

 

 

 

240,369

 

TOTAL EQUITY

 

 

21,628,768

 

 

 

21,273,424

 

TOTAL LIABILITIES AND EQUITY

 

$

33,090,390

 

 

$

33,436,934

 

 

See notes to the condensed consolidated financial statements

 
 
 1 
 

HMG/COURTLAND PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)

 

 

 

For the three months ended

 

 

For the nine months ended

 

 

 

September 30,

 

 

September 30,

 

 

 

2019

 

 

2018

 

 

2019

 

 

2018

 

REVENUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Real estate rentals and related revenue

 

$

18,786

 

 

$

18,092

 

 

$

56,358

 

 

$

54,275

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

EXPENSES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Operating expenses:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Rental and other properties

 

 

31,223

 

 

 

343,196

 

 

 

76,236

 

 

 

382,916

 

Adviser's base fee

 

 

165,000

 

 

 

165,000

 

 

 

495,000

 

 

 

495,000

 

General and administrative

 

 

41,048

 

 

 

92,540

 

 

 

150,550

 

 

 

212,682

 

Professional fees and expenses

 

 

22,637

 

 

 

13,527

 

 

 

144,662

 

 

 

134,819

 

Directors' fees and expenses

 

 

21,583

 

 

 

17,452

 

 

 

59,744

 

 

 

57,817

 

Depreciation and amortization

 

 

3,849

 

 

 

3,849

 

 

 

11,548

 

 

 

11,548

 

Interest expense

 

 

13,447

 

 

 

19,032

 

 

 

42,748

 

 

 

68,262

 

Total expenses

 

 

298,787

 

 

 

654,596

 

 

 

980,488

 

 

 

1,363,044

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Loss before other income, income taxes and gain on sale of real estate

 

 

(280,001

)

 

 

(636,504

)

 

 

(924,130

)

 

 

(1,308,769

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net realized and unrealized gains from investments in marketable securities

 

 

12,190

 

 

 

1,829

 

 

 

252,747

 

 

 

26,291

 

Equity gain (loss) from operations of residential real estate partnerships

 

 

3,225

 

 

 

-

 

 

 

3,225

 

 

 

(143,890

)

Net income from other investments

 

 

479,258

 

 

 

80,208

 

 

 

654,239

 

 

 

370,616

 

Interest, dividend and other income

 

 

136,909

 

 

 

82,756

 

 

 

375,336

 

 

 

271,298

 

Total other income

 

 

631,582

 

 

 

164,793

 

 

 

1,285,547

 

 

 

524,315

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income (loss) before taxes and gain on sale of real estate

 

 

351,581

 

 

 

(471,711

)

 

 

361,417

 

 

 

(784,454

)

Provision for income taxes

 

 

(12,010

)

 

 

(26,532

)

 

 

(14,954

)

 

 

(60,111

)

Net income (loss) before gain on sale of real estate

 

 

339,571

 

 

 

(498,243

)

 

 

346,463

 

 

 

(844,565

)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain on sale of real estate, net

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,473,887

 

Net income (loss)

 

 

339,571

 

 

 

(498,243

)

 

 

346,463

 

 

 

4,629,322

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Gain attributable to non-controlling interest

 

 

(850

)

 

 

(3,097

)

 

 

(9,308

)

 

 

(14,010

)

Net income (loss) attributable to the company

 

$

338,721

 

 

$

(501,340

)

 

$

337,155

 

 

$

4,615,312

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Weighted average common shares outstanding-basic and diluted

 

 

1,013,292

 

 

 

1,013,292

 

 

 

1,013,292

 

 

 

1,011,349

 

Net income (loss) per common share:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted net income (loss) per share

 

$

0.33

 

 

$

(0.49

)

 

$

0.33

 

 

$

4.56

 

 

See notes to the condensed consolidated financial statements

 

 
 2 

 

HMG/COURTLAND PROPERTIES, INC. AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2019 AND 2018 (Unaudited)

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Additional

 

 

Undistributed 

Gains from Sales
of Properties
 

 

 

Undistributed 

Losses from 

 

 

Treasury Stock

 

 

Total
Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Paid-In Capital

 

 

Net of Losses

 

 

Operations

 

 

Shares

 

 

Cost

 

 

Equity

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Balance as of January 1, 2018

 

 

1,035,493

 

 

$

1,035,493

 

 

$

24,076,991

 

 

$

52,208,753

 

 

$

(57,120,990

)

 

 

33,101

 

 

$

(340,281

)

 

$

19,859,966

 

Net income (loss) for three months ended March 31, 2018

 

 

-

 

 

 

-

 

 

 

-

 

 

 

5,473,887

 

 

 

(282,994

)

 

 

-

 

 

 

-

 

 

 

5,190,893

 

Stock options exercised, net of 1,600 re-load shares

 

 

10,900

 

 

 

10,900

 

 

 

80,995

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

91,895

 

Dividend paid -$2.50 per share

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,533,230

)

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(2,533,230

)

Balance as of March 31, 2018

 

 

1,046,393

 

 

 

1,046,393

 

 

 

24,157,986

 

 

 

55,149,410

 

 

 

(57,403,984

)

 

 

33,101

 

 

 

(340,281

)

 

 

22,609,524

 

Net loss for three months ended June 30, 2018

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(74,240

)

 

 

-

 

 

 

-

 

 

 

(74,240

)

Balance as of June 30, 2018

 

 

1,046,393

 

 

 

1,046,393

 

 

 

24,157,986

 

 

 

55,149,410

 

 

 

(57,478,224

)

 

 

33,101

 

 

 

(340,281

)

 

 

22,535,284

 

Net loss for three months ended September 30, 2018

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(501,340

)

 

 

-

 

 

 

-

 

 

 

(501,340

)

Balance as of September 30, 2018

 

 

1,046,393

 

 

$

1,046,393

 

 

$

24,157,986

 

 

$

55,149,410

 

 

$

(57,979,564

)

 

 

33,101

 

 

$

(340,281

)

 

$

22,033,944

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Common Stock

 

 

Additional

 

 

Undistributed 

Gains from Sales
of Properties
 

 

 

Undistributed 

Losses from 

 

 

Treasury Stock

 

 

Total
Stockholders'

 

 

 

Shares

 

 

Amount

 

 

Paid-In Capital

 

 

Net of Losses

 

 

Operations

 

 

Shares

 

 

Cost

 

 

Equity

 

Balance as of January 1, 2019

 

 

1,046,393

 

 

$

1,046,393

 

 

$

24,157,986

 

 

$

54,642,764

 

 

$

(58,473,807

)

 

 

33,101

 

 

$

(340,281

)

 

$

21,033,055

 

Net loss for three months ended March 31, 2019

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

(11,116

)

 

 

-

 

 

 

-

 

 

 

(11,116

)

Balance as of March 31, 2019

 

 

1,046,393

 

 

 

1,046,393

 

 

 

24,157,986

 

 

 

54,642,764

 

 

 

(58,484,923

)

 

 

33,101

 

 

 

(340,281

)

 

 

21,021,939

 

Net income for three months ended June 30, 2019

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

9,550

 

 

 

-

 

 

 

-

 

 

 

9,550

 

Retired 33,101 treasury shares

 

 

(33,101

)

 

 

(33,101

)

 

 

(307,180

)

 

 

-

 

 

 

-

 

 

 

(33,101

)

 

 

340,281

 

 

 

-

 

Balance as of June 30, 2019

 

 

1,013,292

 

 

 

1,013,292

 

 

 

23,850,806

 

 

 

54,642,764

 

 

 

(58,475,373

)

 

 

-

 

 

 

-

 

 

 

21,031,489

 

Net income for three months ended September 30, 2019

 

 

-

 

 

 

-

 

 

 

-

 

 

 

-

 

 

 

338,721

 

 

 

-

 

 

 

-

 

 

 

338,721

 

Stock compensation expense

 

 

 

 

 

 

 

 

 

 

8,880

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

8,880

 

Balance as of September 30, 2019

 

 

1,013,292

 

 

$

1,013,292

 

 

$

23,859,686

 

 

$

54,642,764

 

 

$

(58,136,652

)

 

$

-

 

 

$

-

 

 

$

21,379,090

 

 

See notes to the condensed consolidated financial statements

 

 
 3 

 

HMG/COURTLAND PROPERTIES, INC.  AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)

 

 

 

 

 

 

For the nine months ended 

September 30, 

 

 

 

2019

 

 

2018

 

CASH FLOWS FROM OPERATING ACTIVITIES:

 

 

 

 

 

 

 

 

Net income attributable to the Company

 

$

337,155

 

 

$

4,615,312

 

Adjustments to reconcile net income attributable to the Company to net cash used in operating activities:

 

 

 

 

 

 

 

 

Depreciation expense

 

 

11,548

 

 

 

11,548

 

Stock compensation expense

 

 

8,880

 

 

 

-

 

Net income from other investments, excluding impairment losses

 

 

(654,239

)

 

 

(370,616

)

Equity (gain) on sale of property in residential real estate partnership

 

 

-

 

 

 

(5,473,887

)

Equity (gain) loss from operations of residential real estate partnership

 

 

(3,225

)

 

 

143,890

 

Net (gains) from investments in marketable securities

 

 

(252,747

)

 

 

(26,291

)

Net gain attributable to non-controlling interest

 

 

9,308

 

 

 

14,010

 

Deferred income tax expense

 

 

15,450

 

 

 

60,111

 

Changes in assets and liabilities:

 

 

 

 

 

 

 

 

Other assets and other receivables

 

 

(7,616

)

 

 

62,942

 

Accounts payable, accrued expenses and other liabilities

 

 

(1,785

)

 

 

(223,636

)

Total adjustments

 

 

(874,426

)

 

 

(5,801,929

)

Net cash used in operating activities

 

 

(537,271

)

 

 

(1,186,617

)

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES:

 

 

 

 

 

 

 

 

Net proceeds from sales and redemptions of securities

 

 

1,096,670

 

 

 

1,140,259

 

Investments in marketable securities

 

 

(959,737

)

 

 

(1,379,385

)

Distribution from investment in residential real estate partnership, Orlando, FL

 

 

6,187

 

 

 

7,525,000

 

Contributions to investment residential real estate partnership, Fort Myers, FL

 

 

(3,000,000

)

 

 

(200,000

)

Distributions from other investments

 

 

1,435,879

 

 

 

1,560,667

 

Contributions to other investments

 

 

(919,613

)

 

 

(1,079,783

)

Proceeds from collections of mortgage loans and notes receivables

 

 

-

 

 

 

500,000

 

Distribution from affiliate

 

 

220,899

 

 

 

193,286

 

Purchases and improvements of properties

 

 

(66,162

)

 

 

(26,097

)

Net cash (used in) provided by investing activities

 

 

(2,185,877

)

 

 

8,233,947

 

 

 

 

 

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Margin borrowings

 

 

68,754

 

 

 

9,725,280

 

Dividend paid

 

 

(506,646

)

 

 

(2,533,230

)

Repayment of note payable to affiliate

 

 

(340,000

)

 

 

(210,000

)

Proceeds from stock options exercised

 

 

-

 

 

 

91,895

 

Net cash (used in) provided by financing activities

 

 

(777,892

)

 

 

7,073,945

 

 

 

 

 

 

 

 

 

 

Net (decrease) increase in cash and cash equivalents

 

 

(3,501,040

)

 

 

14,121,275

 

Cash and cash equivalents at beginning of the period

 

 

19,738,174

 

 

 

5,223,995

 

Cash and cash equivalents at end of the period

 

$

16,237,134

 

 

$

19,345,270

 

 

 

 

 

 

 

 

 

 

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:

 

 

 

 

 

 

 

 

Cash paid during the period for interest

 

$

43,000

 

 

$

68,000

 

 

 

 

 

 

 

 

 

 

NON-CASH INVESTING AND FINANCING ACTIVITIES:

 

 

 

 

 

 

 

 

Retirement of treasury stock during the period

 

$

340,281

 

 

$

-

 

 

See notes to the condensed consolidated financial statements

 
 
 4 

 

HMG/COURTLAND PROPERTIES, INC. AND SUBSIDIARIES

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

 

1.

CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

 

In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements prepared in accordance with instructions for Form 10-Q, include all adjustments (consisting only of normal recurring accruals) which are necessary for a fair presentation of the results for the periods presented.  Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these condensed consolidated financial statements be read in conjunction with the Company's Annual Report for the year ended December 31, 2018.  The balance sheet as of December 31, 2018 was derived from audited consolidated financial statements as of that date. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for future periods or the full year.

 

The condensed consolidated financial statements include the accounts of HMG/Courtland Properties, Inc. (the "Company") and entities in which the Company owns a majority voting interest or controlling financial interest. All material transactions and balances with consolidated and unconsolidated entities have been eliminated in consolidation or as required under the equity method.

 

2.

RECENT ACCOUNTING PRONOUNCEMENTS

 

In June 2018, the FASB issued ASU 2018-07, “Compensation – Stock Compensation (Topic 718).” ASU 2018-07 simplifies the accounting for nonemployee stock-based payment transactions. This ASU is effective for public entities for interim and annual reporting periods beginning after December 15, 2018, and early application is permitted. The adoption of this guidance on January 1, 2019 did not have an impact on the Company’s consolidated financial statements.

 

In February 2016, the FASB issued ASU 2016-02, “Leases,” which created a new Topic, ASC Topic 842 and established the core principle that a lessee should recognize the assets, representing rights-of-use, and liabilities to make lease payments that arise from leases. For leases with a term of 12 months or less, a lessee is permitted to make an election under which such assets and liabilities would not be recognized, and lease expense would be recognized generally on a straight-line basis over the lease term. This ASU is effective for public entities for interim and annual reporting periods beginning after December 15, 2018, and early application is permitted. The adoption of this guidance on January 1, 2019 did not have an impact on the Company’s consolidated financial statements.

 

The Company does not believe that any recently issued, but not yet effective accounting standards, if currently adopted, will have a material effect on the Company’s consolidated financial position, results of operations and cash flows.

 

3.

INVESTMENT IN RESIDENTIAL REAL ESTATE PARTNERSHIP (FORT MYERS, FL)

 

As previously reported on Form 8-K dated July 19, 2019, pursuant to the terms of a Construction and Mini Perm Loan Agreement ("Loan Agreement"), between Murano At Three Oaks Associates LLC, a Florida limited liability company formed in September 2018 (the “Borrower”) which is 25% owned by HMG, and PNC Bank, National Association ("Lender"), Lender provided a construction loan to the Borrower for the principal sum of approximately $41.59 million (“Loan”). The proceeds of the Loan shall be used to finance the construction of multi-family residential apartments containing 318 units totaling approximately 312,000 net rentable square feet on a 17.5-acre site located in Fort Myers, Florida ("Project").  The Project site was purchased by the Borrower concurrently with the closing of the Loan. Total development costs for the Project are estimated at approximately $56.08 million and the Borrower’s equity totals approximately $14.49 million. HMG’s share of the equity is 25%, or approximately $3.62 million, all of which has been funded to date including approximately $423,000 funded on October 8, 2019. Construction activities on the Project site began in August 2019. There is no outstanding amount on the loan as of September 30, 2019.

 
 5 
 

HMG and the other members (or affiliates thereof) of the Borrower ("Guarantors") entered into a Completion Guaranty ("Completion Guaranty") and a Guaranty and Suretyship Agreement ("Repayment Guaranty") (collectively, the “Guaranties”). Under the Completion Guaranty, each Guarantor shall unconditionally guaranty, as a primary obligor, and become surety for the prompt payment and performance by Borrower of the “Guaranteed Obligations” (as defined). Under the Repayment Guaranty, Guarantor unconditionally guarantees, as a primary obligor, and becomes surety for the prompt payment and performance of, as defined (i) all Interest Obligations, (ii) all Loan Document Obligations, (iii) all Expense Obligations, (iv) the Carrying Cost Obligations, (v) the Principal Amount, (vi) interest on each of the foregoing including, if applicable, interest at the Default Rate (as defined). At all times prior to the First Reduction Date (as defined below), the Guarantors are collectively responsible for 30% of the Principal Obligations, (ii) at all times after the First Reduction Date, the Guarantors are collectively responsible for15% of the Principal Obligations, and (iii) at all times after the Second Reduction Date, 0% of the Principal Obligations. First Reduction Conditions" means satisfaction of the following conditions: (i) no Event of Default has occurred and is continuing; (ii) Completion of Construction has occurred; and (iii) the Project has achieved a DSCR of not less than 1.25 to 1.00 for two (2) consecutive fiscal quarters.

 

Each Guarantor is required to maintain compliance with the following financial covenants, as defined: (1) liquidity shall not be less than $2.5 million. Liquidity is defined as the sum of unencumbered, unrestricted cash and cash equivalents and marketable securities, and (2) net worth shall not be less than $10 million.  As of September 30, 2019, HMG was in compliance with all covenants required by Guarantors in the Loan Agreement.

4.

INVESTMENTS IN MARKETABLE SECURITIES

 

Investments in marketable securities consist primarily of large capital corporate equity and debt securities in varying industries or issued by government agencies with readily determinable fair values. These securities are stated at market value, as determined by the most recent traded price of each security at the balance sheet date. Consistent with the Company's overall current investment objectives and activities its entire marketable securities portfolio is classified as trading. Accordingly, all unrealized gains (losses) on this portfolio are recorded in income.  Included in investments in marketable securities is approximately $1.90 million and $1.76 million of large capital real estate investment trusts (REITs) as of September 30, 2019 and December 31, 2018, respectively.

 

Net realized and unrealized gain from investments in marketable securities for the three and nine months ended September 30, 2019 and 2018 is summarized below:

 

 

 

Three months ended

September 30,

 

 

Nine months ended

September 30,

 

Description

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Net realized gain from sales of securities

 

$

17,000

 

 

$

39,000

 

 

$

6,000

 

 

$

35,000

 

Unrealized net (loss) gain in trading securities

 

 

(5,000

)

 

 

(37,000

)

 

 

247,000

 

 

 

(9,000

)

Total net gain from investments in marketable securities

 

$

12,000

 

 

$

2,000

 

 

$

253,000

 

 

$

26,000

 

 

For the three months ended September 30, 2019, net realized gain from sales of marketable securities was approximately $17,000 which consisted of $19,000 of gross gains and $2,000 of gross losses. For the nine months ended September 30, 2019, net realized loss from sales of marketable securities was approximately $6,000 and consisted of approximately $66,000 of gross gains net of $60,000 of gross losses.

 

For the three months ended September 30, 2018, net realized gain from sales of marketable securities was approximately $39,000 of which approximately $44,000 consisted of gross gains and $5,000 of gross losses. For the nine months ended September 30, 2018, net realized gain from sales of marketable securities was approximately $35,000 and consisted of approximately $68,000 of gross gains net of $33,000 of gross losses.

 

Investment gains and losses on marketable securities may fluctuate significantly from period to period in the future and could have a significant impact on the Company's net earnings. However, the amount of investment gains or losses on marketable securities for any given period has no predictive value and variations in amount from period to period have no practical analytical value.

 

5.

OTHER INVESTMENTS

 

As of September 30, 2019, the Company’s portfolio of other investments had an aggregate carrying value of approximately $5.9 million and we have committed to fund approximately $919,000 as required by agreements with the investees. The carrying value of these investments is equal to contributions less distributions and loss valuation adjustments, if any.

 

 
 6 

During the nine months ended September 30, 2019, we made cash contributions to other investments of approximately $920,000. This consisted of $700,000 in three new investments.  One in February 2019 for $200,000 in a partnership which holds residential mortgages acquired from a bank at discount, one in June 2019 for $300,000 in a partnership that is constructing residential apartments in Atlanta, GA and one in July 2019 for $200,000 in a real estate private lending fund.  We also made follow on contributions to existing investments of approximately $220,000.

 

During the nine months ended September 30, 2019, we received cash distributions from other investments of approximately $1,436,000.  This consisted of distributions from existing investments (primarily real estate related), including $563,000 received in September 2019 from a partnership which sold its sole asset, a multifamily residential property located in Austin, Texas.  We recognized a gain of $429,000 on this investment, before incentive fee.  In August 2019, we redeemed a stock fund for $316,000 and recognized a gain of $66,000, before incentive fee. Also, in the first quarter of 2019 the Company’s $300,000 investments in a private insurance company publicly registered all shares and began trading on the NASDAQ on March 29, 2019.  Accordingly, we have transferred this investment to marketable securities.  As of September 30, 2019, this investment had an unrealized loss of approximately $98,000.

 

Net income from other investments for the three and nine months ended September 30, 2019 and 2018, is approximately as follows:

 

 

Three months ended

September 30,

 

 

Nine months ended

September 30,

 

Description

 

2019

 

 

2018

 

 

2019

 

 

2018

 

Partnerships owning real estate and related

 

$

409,000

 

 

$

26,000

 

 

$

536,000

 

 

$

191,000

 

Partnerships owning diversified businesses

 

 

61,000

 

 

 

29,000

 

 

 

97,000

 

 

 

70,000

 

Other (bank stocks)  

 

 

-

 

 

 

-

 

 

 

-

 

 

 

34,000

 

Income from investment in 49% owned affiliate (T.G.I.F. Texas, Inc.)

 

 

9,000

 

 

 

25,000

 

 

 

21,000

 

 

 

76,000

 

Total net income from other investments

 

$

479,000

 

 

$

80,000

 

 

$

654,000

 

 

$

371,000

 

 

The following tables present approximate gross unrealized losses and fair values for those investments that were in an unrealized loss position as of September 30, 2019 and December 31, 2018, aggregated by investment category and the length of time that investments have been in a continuous loss position:

 

 

 

As of September 30, 2019

 

 

 

12 Months or Less

 

 

Greater than 12 Months

 

 

Total

 

Investment Description

 

Fair Value

 

 

Unrealized

Loss

 

 

Fair Value

 

 

Unrealized

Loss

 

 

Fair Value

 

 

Unrealized

Loss

 

Partnerships owning investments in technology related industries

 

$

-

 

 

$

-

 

 

$

150,000

 

 

$

(11,000

)

 

$

150,000

 

 

$

(11,000

)

Partnerships owning investments in diversified businesses

 

 

513,000

 

 

 

(30,000

)

 

 

-

 

 

 

-

 

 

 

513,000

 

 

 

(30,000

)

Total

 

$

513,000

 

 

$

(30,000

)

 

$

150,000

 

 

$

(11,000

)

 

$

663,000

 

 

$

(41,000

)

 

 

 

 

 

 

As of December 31, 2018

 

 

 

12 Months or Less

 

 

Greater than 12 Months

 

 

Total

 

Investment Description

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

Partnerships owning investments in technology related industries

 

$

-

 

 

$

-

 

 

$

132,000

 

 

$

(18,000

)

 

$

132,000

 

 

$

(18,000

)

Partnerships owning investments in diversified businesses

 

 

273,00

 

 

 

(27,000

)

 

 

 

 

 

 

 

 

 

 

273,000

 

 

 

(27,000

)

Total

 

$

273,000

 

 

 

(27,000

)

 

 

132,000

 

 

$

(18,000

)

 

$

405,000

 

 

$

(45,000

)

 

When evaluating the investments for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and the Company’s intent to sell, or whether it is more likely than not it will be required to sell, the investment before recovery of the investment’s amortized cost basis.

 
 
 7 

In accordance with ASC Topic 320-10-65, Recognition and Presentation of Other-Than-Temporary Impairments there were no impairment valuation adjustments for the three and nine months ended September 30, 2019 and 2018.

 

6.

FAIR VALUE OF FINANCIAL INSTRUMENTS

 

In accordance with ASC Topic 820, the Company measures cash and cash equivalents and marketable debt and equity securities at fair value on a recurring basis. Other investments are measured at fair value on a nonrecurring basis.

 

The following are the major categories of assets and liabilities measured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018, using quoted prices in active markets for identical assets (Level 1) and significant other observable inputs (Level 2).  For the periods presented, there were no major assets measured at fair value on a recurring basis where significant unobservable inputs were used (Level 3):

 

Assets and liabilities measured at fair value on a recurring basis are summarized below:

 

 

 

Fair value measurement at reporting date using

 

Description

 

Total 

September 30,
2019 

 

 

Quoted Prices in Active 

Markets for Identical Assets
(Level 1) 

 

 

Significant Other 

Observable Inputs
(Level 2) 

 

 

Significant 

Unobservable Inputs
(Level 3) 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Money market mutual funds

 

$

1,040,000

 

 

$

1,040,000

 

 

 

-

 

 

$

-

 

US T-Bills

 

 

14,282,000

 

 

 

14,282,000

 

 

 

-

 

 

 

-

 

Marketable securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate debt securities

 

 

520,000

 

 

 

-

 

 

$

520,000

 

 

 

-

 

Marketable equity securities

 

 

2,971,000

 

 

 

2,971,000

 

 

 

-

 

 

 

-

 

Total assets

 

$

18,813,000

 

 

$

18,293,000

 

 

$

520,000

 

 

$

-

 

 

 

 

Fair value measurement at reporting date using

 

Description

 

Total 

December 31,
2018 

 

 

Quoted Prices in Active 

Markets for Identical Assets
(Level 1) 

 

 

Significant Other 

Observable Inputs
(Level 2) 

 

 

Significant 

Unobservable Inputs
(Level 3) 

 

Assets:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Cash equivalents:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Time deposits

 

$

355,000

 

 

$

-

 

 

$

355,000

 

 

$

-

 

Money market mutual funds

 

 

1,594,000

 

 

 

1,594,000

 

 

 

-

 

 

 

-

 

US T-Bills

 

 

17,429,000

 

 

 

17,429,000

 

 

 

-

 

 

 

-

 

Marketable securities:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Corporate debt securities

 

 

502,000

 

 

 

-

 

 

 

502,000

 

 

 

-

 

Marketable equity securities

 

 

2,574,000

 

 

 

2,574,000

 

 

 

-

 

 

 

-

 

Total assets

 

$

22,454,000

 

 

$

21,597,000

 

 

$

857,000

 

 

$

-

 

 

Carrying amount is the estimated fair value for corporate debt securities and time deposits based on a market-based approach using observable (Level 2) inputs such as prices of similar assets in active markets.

 

7.

INCOME TAXES

 

The Company as a qualifying real estate investment trust (“REIT”) distributes its taxable ordinary income to stockholders in conformity with requirements of the Internal Revenue Code and is not required to report deferred items due to its ability to distribute all taxable income. In addition, net operating losses can be carried forward to reduce future taxable income but cannot be carried back.

 

The Company’s 95%-owned taxable REIT subsidiary, CII, files a separate income tax return and its operations are not included in the REIT’s income tax return.

 

 
 8 
 
Distributed capital gains on sales of real estate as they relate to REIT activities are not subject to taxes; however, undistributed capital gains may be subject to corporate tax.

 

On December 14, 2018 the Company declared a capital gain dividend of $0.50 per share which was payable on January 9, 2019 to all shareholders of record as of December 28, 2018.

 

The Company accounts for income taxes in accordance with ASC Topic 740, “Accounting for Income Taxes.” ASC Topic 740 requires a Company to use the asset and liability method of accounting for income taxes. Under this method, deferred income taxes are recognized for the tax consequences of “temporary differences” by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. The effect on deferred income taxes of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred taxes only pertain to CII. As of September 30, 2019, and December 31, 2018, the Company has recorded a net deferred tax liability of $63,000 and $48,000, respectively, primarily as a result of timing differences associated with the carrying value of the investment in affiliate (TGIF) and other investments. CII’s NOL carryover to 2019 is approximately at $1 million and has been fully reserved due to CII historically having tax losses.

 

The provision for income taxes in the consolidated statements of comprehensive income consists approximately of the following:

 

Nine months ended September 30,

 

2019

 

 

2018

 

Current:

 

 

 

 

 

 

 

 

Federal

 

$

-

 

 

$

-

 

State

 

 

-

 

 

 

-

 

 

 

 

-

 

 

 

-

 

Deferred:

 

 

 

 

 

 

 

 

Federal

 

$

13,000

 

 

$

43,000

 

State

 

 

2,000

 

 

 

10,000

 

 

 

 

15,000

 

 

 

53,000

 

Increased valuation allowance

 

 

-

 

 

 

7,000

 

Total

 

$

15,000

 

 

$

60,000

 

 

The Company follows the provisions of ASC Topic 740-10, “Accounting for Uncertainty in Income Taxes” which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with ASC Topic 740 and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This topic also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.

 

Based on our evaluation, we have concluded that there are no significant uncertain tax positions requiring recognition in our consolidated financial statements. Our evaluation was performed for the tax years ended December 31, 2018. The Company’s federal income tax returns since 2014 are subject to examination by the Internal Revenue Service, generally for a period of three years after the returns were filed.

  

We may from time to time be assessed interest or penalties by major tax jurisdictions, although any such assessments historically have been minimal and immaterial to our financial results. In the event we have received an assessment for interest and/or penalties, it has been classified in the consolidated financial statements as selling, general and administrative expense.

 

8.

STOCK OPTIONS

 

Stock based compensation expense is recognized using the fair-value method for all awards. On July 25, 2019 the Company granted options to purchase 8,000 shares of the Company’s common stock to three directors and one officer.  The exercise price of the options is equal to $13.20 per share, the market price of the stock on the date of grant and the options expires on June 29, 2021.  The Company determined the fair value of its option awards using the Black-Scholes option pricing model.  The following assumptions were used to value the options granted during the nine months ended September 30, 2019: 2 year expected life; expected volatility of approximately 19.5%; risk-free of 1.93% and annual dividend yield of 4%.  The expected life for options granted during the period represents the period of time that options are to be outstanding based on the expiration date of the Plan.  Expected volatilities are based upon historical volatility of the Company’s stock over a period equal to the 2 year expected life.

 
 
 9 

 

The weighted average fair value for options granted during the nine months ended September 30, 2019 was $1.11 per share.  For the nine months ended September 30, 2019 the Company recorded approximately $9,000 in stock expense compensation relating to the options granted in 2019. 

 

The following table summarizes stock option activity during the nine months ended September 30, 2019:

 

 

 

 

 

 

Weighted

 

 

 

 

 

 

Average

 

 

 

Options

 

 

Exercise

 

 

 

Outstanding

 

 

Price

 

Outstanding at January 1, 2019

 

 

1,600

 

 

$

15.30

 

Exercised

 

 

-

 

 

 

-

 

Forfeited

 

 

-

 

 

 

-

 

Expired unexercised

 

 

-

 

 

 

-

 

Granted options

 

 

8,000

 

 

 

13.20

 

Outstanding at September 30, 2019

 

 

9,600

 

 

$

13.55

 

 

The following table summarizes information concerning outstanding and exercisable options as of September 30, 2019:

 

 

 

Number of 

securities to be
issued upon 

exercise of
outstanding options 

 

 

Weighted-average 

exercise price of
outstanding options 

 

 

Number of securities 

remaining available for future
issuance under equity 

compensation plans 

 

Equity compensation plan approved by shareholders

 

 

9,600

 

 

$

13.55

 

 

 

36,608

 

Equity compensation plan not approved by shareholders

 

 

 

 

 

 

 

 

 

Total

 

 

9,600

 

 

$

13.55

 

 

 

36,608

 

 

As of September 30, 2019, the stock options outstanding and exercisable had no intrinsic value.

 10 

 

Item 2.

Management's Discussion and Analysis of Financial Condition and Results of Operations

 

RESULTS OF OPERATIONS 

The Company reported net income of approximately $339,000 ($0.33 per share) and $337,000 ($0.33 per share) for the three and nine months ended September 30, 2019, respectively. The Company reported a net loss of approximately $501,000 ($0.49 per share) for the three months ended September 30, 2018, and net income of approximately $4.6 million ($4.56 per share) for the nine months ended September 30, 2018.

 

REVENUES 

Rentals and related revenues for the three and nine months ended September 30, 2019 were approximately $19,000 and $56,000, respectively and primarily consists of rent from the Advisor to CII for its corporate office. For the three and nine months ended September 30, 2018 rental and related revenues were $18,000 and $54,000, respectively.

 

Net realized and unrealized gains from investments in marketable securities: 

Net realized gain from the sale of marketable securities for the three and nine months ended September 30, 2019 was approximately $17,000 and $6,000, respectively.  Unrealized net loss from investments in marketable securities for the three months ended September 30, 2019 was approximately $5,000. Unrealized net gain from investments in marketable securities for the nine months ended September 30, 2019 was approximately $247,000. Net realized gain from investments in marketable securities for the three and nine months ended September 30, 2018 was approximately $39,000 and $35,000, respectively.  Unrealized net loss from investments in marketable securities for the three and nine months ended September 30, 2018 was approximately $37,000 and $9,000, respectively.  For further details refer to Note 4 to Condensed Consolidated Financial Statements (unaudited).

 

Equity gain (loss) from operations in residential real estate partnerships: 

Equity gain (loss) from operations in residential real estate partnerships for the three and nine months ended September 30, 2019 was approximately $3,000 from interest income earned from member contributions prior to construction of multi-family residential apartments in Fort Myers, FL. Equity loss from operations in residential real estate partnerships for the nine months ended September 30, 2018 was approximately$144,000 relating to the multi-family residential apartments which property was sold in February 2018 and the Company recognized a gain on the sale of approximately $5.47 million, net of incentive fee in the first quarter of 2018.

 

Net income from other investments: 

Net income from other investments for the three and nine months ended September 30, 2019 was approximately $479,000 and $654,000, respectively.  Net income from other investments for the three and nine months ended September 30, 2018 was approximately $80,000 and $371,000, respectively.   For further details refer to Note 5 to Condensed Consolidated Financial Statements (unaudited).

 

Interest, dividend and other income: 

Interest, dividend and other income for the three and nine months ended September 30, 2019 was approximately $137,000 and $375,000, respectively.  Interest, dividend and other income for the three and nine months ended September 30, 2018 was approximately $83,000 and $271,000, respectively.  The increases in the three and nine-month comparable periods was primarily due to increased interest income from investments in US T-bills.

 

EXPENSES 

Rental and other properties operating expenses for the three and nine months ended September 30, 2019 as compared with the same periods in 2018 decreased by $312,000 (91%) and $307,000 (80%), respectively.  The decreases were primarily the result of non-recurring estimated environmental remediation costs relating the Company’s property located in Montpelier, Vermont.

 

General and administrative expenses for the three and nine months ended September 30, 2019 as compared with the same periods in 2018 decreased by $51,000 (56%) and $62,000 (29%), respectively.  The decreases were primarily attributable to decreased dues and subscriptions expenses relating to Courtland Investments, Inc. and decreased non-recurring costs relating to a proposed real estate venture in Orlando which was not pursued, and the related deposits were written off in 2018.

 

Interest expense for the nine months ended September 30, 2019 as compared with the same period in 2018 decreased by approximately $25,000 (37%).  The decrease was primarily due to decreased interest rates.

 

EFFECT OF INFLATION: 

Inflation affects the costs of holding the Company's investments. Increased inflation would decrease the purchasing power of our mainly liquid investments.

 
 
 11 
 

LIQUIDITY, CAPITAL EXPENDITURE REQUIREMENTS AND CAPITAL RESOURCES

The Company's material commitments primarily consist of a note payable to the Company’s 49% owned affiliate, T.G.I.F. Texas, Inc. (“TGIF”) of approximately $1.0 million due on demand, contributions committed to other investments of approximately $919,000 due upon demand. The $9.93 million in margin is primarily related to the purchase of US T-bills at quarter end.  The T-bills were sold in October 2019 and the related margin was repaid.  The purchase of T-bills at each fiscal quarter end is for the purposes of qualifying for the REIT asset test. The funds necessary to meet these obligations are expected from the proceeds from the sales of investments, distributions from investments and available cash. 

 

MATERIAL COMPONENTS OF CASH FLOWS 

For the nine months ended September 30, 2019, net cash used in operating activities was approximately $537,000, primarily consisting of operating expenses less interest, dividend and other income.

 

For the nine months ended September 30, 2019, net cash used in investing activities was approximately $2.19 million.  This consisted primarily of contributions to investment in residential real estate partnership (Fort Myers, FL) of $3.0 million, purchases of marketable securities of $960,000, contribution to other investments of $920,000 and purchases and improvements of properties of $66,000. These uses of funds were partially offset by sources of cash consisting primarily of $1.10 million of net proceeds from sales and redemptions of marketable securities, distributions from other investments of $1.44 million and distribution from affiliate of $221,000.

 

For the nine months ended September 30, 2019, net cash used in financing activities was approximately $778,000, consisting of $507,000 dividends paid and $340,000 principal payment on note due to affiliate.  These uses of funds were partially offset by increased margin borrowings (net of repayments) of $69,000.

 

Item 3.

Quantitative and Qualitative Disclosures about Market Risk

Not applicable

 

Item 4.

Controls and Procedures

(a)

Evaluation of Disclosure Controls and Procedures.

Our Chief Executive Officer and Chief Financial Officer, after evaluating the effectiveness of our disclosure controls and procedures (as defined in the Securities Exchange Act Rules 13a-15(e) and 15d-15(e)) as of the end of the period covered by this Quarterly Report on Form 10-Q have concluded that, based on such evaluation, our disclosure controls and procedures were effective and designed to ensure that material information relating to us and our consolidated subsidiaries, which we are required to disclose in the reports we file or submit under the Securities Exchange Act of 1934, was made known to them by others within those entities and reported within the time periods specified in the SEC's rules and forms.

 

(b)

Changes in Internal Control Over Financial Reporting.

There were no changes in the Company's internal controls over financial reporting identified in connection with the evaluation of such internal control over financial reporting that occurred during our last fiscal quarter which have materially affected, or reasonably likely to materially affect, our internal control over financial reporting.

 

PART II.   OTHER INFORMATION

 

Item 1.

Legal Proceedings: None

 

Item 2.

Unregistered Sales of Equity Securities and Use of Proceeds:

As previously reported on December 14, 2018, HMG announced that its Board of Directors has authorized the purchase of up to $500,000 of HMG common stock on the open market or through privately negotiated transactions.  The program will be in place through December 31, 2021.  During the nine months ended September 30, 2019, there were no shares purchased as part of this publicly announced program.

 

Item 3.

Defaults Upon Senior Securities: None.

 

Item 4.

Mine Safety Disclosures: Not applicable.

 

Item 5.

Other Information: None

 

Item 6.

Exhibits:

 

(a)  Certifications pursuant to 18 USC Section 1350-Sarbanes-Oxley Act of 2002. Filed herewith.

 
 
 12 
 

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.

 

HMG/COURTLAND PROPERTIES, INC.

 

 

 

/s/ Maurice Wiener

Dated:  November 13, 2019

CEO and President

 

 

 

Dated:  November 13, 2019

/s/Carlos Camarotti

 

CFO and Vice President

 
 
 13 
 

Exhibits:

 

EXHIBIT 31A: CERTIFICATION REQUIRED UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Maurice Wiener, certify that:

 

1.  I have reviewed this quarterly report on Form 10-Q of HMG/Courtland Properties, Inc.

 

2.  Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

 

3.  Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

 

4.  The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have: 

a)  designed such disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)), or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; 

b)  designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; 

c)  evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

d)  disclosed this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting;

 

5.  The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function): 

a)  all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and 

b)  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

 

Date:  November 13, 2019

 

  /s/ Maurice Wiener

 

Maurice Wiener, Principal Executive Officer

 

 
 
 

Exhibits:

 

EXHIBIT 31B: CERTIFICATION REQUIRED UNDER SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 

I, Carlos Camarotti, certify that:

 

1.  I have reviewed this quarterly report on Form 10-Q of HMG/Courtland Properties, Inc.

 

2.  Based on my knowledge, this quarterly report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this quarterly report;

 

3.  Based on my knowledge, the financial statements, and other financial information included in this quarterly report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this quarterly report;

 

4.  The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f) for the registrant and have: 

a)  designed such disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e)), or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this quarterly report is being prepared; 

b)  designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; 

c)  evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and 

d)  disclosed this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; 

 

5.  The registrant’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of registrant’s board of directors (or persons performing the equivalent function): 

a)  all significant deficiencies in the design or operation of internal controls which could adversely affect the registrant’s ability to record, process, summarize and report financial data and have identified for the registrant’s auditors any material weaknesses in internal controls; and 

b)  any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal controls over financial reporting.

 

Date:  November 13, 2019

 

  /s/ Carlos Camarotti

 

Carlos Camarotti, Principal Financial Officer

 

 
 
 

EXHIBIT 32:

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of HMG/Courtland Properties, Inc. (the "Company") on Form 10-Q for the period ending September 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Maurice Wiener, Principal Executive Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13 or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods indicated in the Report.

 

/s/ Maurice Wiener

 

Principal Executive Officer

 

HMG/Courtland Properties, Inc.

 

 

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

 

In connection with the Quarterly Report of HMG/Courtland Properties, Inc. (the "Company") on Form 10-Q for the period ending September 30, 2019 as filed with the Securities and Exchange Commission on the date hereof (the "Report"), I, Carlos Camarotti, Principal Financial Officer of the Company, certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that:

(1) The Report fully complies with the requirements of section 13 or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company for the periods indicated in the Report.

 

/s/ Carlos Camarotti

 

Principal Financial Officer

 

HMG/Courtland Properties, Inc.

 

 
 
 
v3.19.3
INVESTMENTS IN MARKETABLE SECURITIES (Tables)
9 Months Ended
Sep. 30, 2019
Investments, Debt and Equity Securities [Abstract]  
Gain (Loss) on Securities [Table Text Block]
Net realized and unrealized gain from investments in marketable securities for the three and nine months ended September 30, 2019 and 2018 is summarized below:
 
 
 
Three months ended
September 30,
 
 
Nine months ended
September 30,
 
Description
 
2019
 
 
2018
 
 
2019
 
 
2018
 
Net realized gain from sales of securities
 
$
17,000
 
 
$
39,000
 
 
$
6,000
 
 
$
35,000
 
Unrealized net (loss) gain in trading securities
 
 
(5,000
)
 
 
(37,000
)
 
 
247,000
 
 
 
(9,000
)
Total net gain from investments in marketable securities
 
$
12,000
 
 
$
2,000
 
 
$
253,000
 
 
$
26,000
 
v3.19.3
FAIR VALUE OF FINANCIAL INSTRUMENTS
9 Months Ended
Sep. 30, 2019
Fair Value Disclosures [Abstract]  
Fair Value Disclosures [Text Block]
6.
FAIR VALUE OF FINANCIAL INSTRUMENTS
 
In accordance with ASC Topic 820, the Company measures cash and cash equivalents and marketable debt and equity securities at fair value on a recurring basis. Other investments are measured at fair value on a nonrecurring basis.
 
The following are the major categories of assets and liabilities me
a
sured at fair value on a recurring basis as of September 30, 2019 and December 31, 2018, using quoted prices in active markets for identical assets (Level 1) and significant other observable inputs (Level 2).  For the periods presented, there were no major assets measured at fair value on a recurring basis where significant unobservable inputs were used (Level 3):
 
Assets and liabilities measured at fair value on a recurring basis are summarized below:
 
 
 
Fair value measurement at reporting date using
 
Description
 
Total
 
September 30,
2019 
 
 
Quoted Prices in Active
 
Markets for Identical Assets
(Level 1) 
 
 
Significant Other
 
Observable Inputs
(Level 2) 
 
 
Significant
 
Unobservable Inputs
(Level 3) 
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash equivalents:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market mutual funds
 
$
1,040,000
 
 
$
1,040,000
 
 
 
-
 
 
$
-
 
US T-Bills
 
 
14,282,000
 
 
 
14,282,000
 
 
 
-
 
 
 
-
 
Marketable securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities
 
 
520,000
 
 
 
-
 
 
$
520,000
 
 
 
-
 
Marketable equity securities
 
 
2,971,000
 
 
 
2,971,000
 
 
 
-
 
 
 
-
 
Total assets
 
$
18,813,000
 
 
$
18,293,000
 
 
$
520,000
 
 
$
-
 
 
 
 
Fair value measurement at reporting date using
 
Description
 
Total
 
December 31,
2018 
 
 
Quoted Prices in Active
 
Markets for Identical Assets
(Level 1) 
 
 
Significant Other
 
Observable Inputs
(Level 2) 
 
 
Significant
 
Unobservable Inputs
(Level 3) 
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash equivalents:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Time deposits
 
$
355,000
 
 
$
-
 
 
$
355,000
 
 
$
-
 
Money market mutual funds
 
 
1,594,000
 
 
 
1,594,000
 
 
 
-
 
 
 
-
 
US T-Bills
 
 
17,429,000
 
 
 
17,429,000
 
 
 
-
 
 
 
-
 
Marketable securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities
 
 
502,000
 
 
 
-
 
 
 
502,000
 
 
 
-
 
Marketable equity securities
 
 
2,574,000
 
 
 
2,574,000
 
 
 
-
 
 
 
-
 
Total assets
 
$
22,454,000
 
 
$
21,597,000
 
 
$
857,000
 
 
$
-
 
 
Carrying amount is the estimated fair value for corporate debt securities and time deposits based on a market-based approach using observable (Level 2) inputs such as prices of similar assets in active markets.
v3.19.3
INCOME TAXES (Details Textual) - USD ($)
1 Months Ended
Dec. 14, 2018
Sep. 30, 2019
Dec. 31, 2018
Income Tax Disclosure [Line Items]      
Deferred Income Tax Liabilities, Net   $ 63,000 $ 48,000
Common Stock, Dividends, Per Share, Cash Paid $ 0.50    
Cii [Member]      
Income Tax Disclosure [Line Items]      
Noncontrolling Interest, Ownership Percentage by Parent   95.00%  
Cii [Member] | Change in Accounting Method Accounted for as Change in Estimate [Member]      
Income Tax Disclosure [Line Items]      
Operating Loss Carryforwards   $ 1,000,000  
v3.19.3
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
9 Months Ended
Sep. 30, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Condensed Financial Statements [Text Block]
1
.
CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
 
In the opinion of the Company, the accompanying unaudited condensed consolidated financial statements prepared in accordance with instructions for Form 10-Q, include all adjustments (consisting only of normal recurring accruals) which are necessary for a fair presentation of the results for the periods presented.  Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted.  It is suggested that these condensed consolidated financial statements be read in conjunction with the Company's Annual Report for the year ended December 31, 2018.  The balance sheet as of December 31, 2018 was derived from audited consolidated financial statements as of that date. The results of operations for the three and nine months ended September 30, 2019 are not necessarily indicative of the results to be expected for future periods or the full year.
 
The condensed consolidated financial statements include the accounts of HMG/Courtland Properties, Inc. (the "Company") and entities in which the Company owns a majority voting interest or controlling financial interest. All material transactions and balances with consolidated and unconsolidated entities have been eliminated in consolidation or as required under the equity method.
v3.19.3
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
REVENUES        
Real estate rentals and related revenue $ 18,786 $ 18,092 $ 56,358 $ 54,275
Operating expenses:        
Rental and other properties 31,223 343,196 76,236 382,916
Adviser's base fee 165,000 165,000 495,000 495,000
General and administrative 41,048 92,540 150,550 212,682
Professional fees and expenses 22,637 13,527 144,662 134,819
Directors' fees and expenses 21,583 17,452 59,744 57,817
Depreciation and amortization 3,849 3,849 11,548 11,548
Interest expense 13,447 19,032 42,748 68,262
Total expenses 298,787 654,596 980,488 1,363,044
Loss before other income, income taxes and gain on sale of real estate (280,001) (636,504) (924,130) (1,308,769)
Net realized and unrealized gains from investments in marketable securities 12,190 1,829 252,747 26,291
Equity gain (loss) from operations of residential real estate partnerships 3,225 0 3,225 (143,890)
Net income from other investments 479,258 80,208 654,239 370,616
Interest, dividend and other income 136,909 82,756 375,336 271,298
Total other income 631,582 164,793 1,285,547 524,315
Income (loss) before taxes and gain on sale of real estate 351,581 (471,711) 361,417 (784,454)
Provision for income taxes (12,010) (26,532) (14,954) (60,111)
Net income (loss) before gain on sale of real estate 339,571 (498,243) 346,463 (844,565)
Gain on sale of real estate, net 0 0 0 5,473,887
Net income (loss) 339,571 (498,243) 346,463 4,629,322
Gain attributable to non-controlling interest (850) (3,097) (9,308) (14,010)
Net income (loss) attributable to the company $ 338,721 $ (501,340) $ 337,155 $ 4,615,312
Weighted average common shares outstanding-basic and diluted 1,013,292 1,013,292 1,013,292 1,011,349
Net income (loss) per common share:        
Basic and diluted net income (loss) per share $ 0.33 $ (0.49) $ 0.33 $ 4.56
v3.19.3
OTHER INVESTMENTS (Details) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Investments, All Other Investments [Abstract]        
Partnerships owning real estate and related $ 409,000 $ 26,000 $ 536,000 $ 191,000
Partnerships owning diversified businesses 61,000 29,000 97,000 70,000
Other (bank stocks) 0 0 0 34,000
Income from investment in 49% owned affiliate (T.G.I.F. Texas, Inc.) 9,000 25,000 21,000 76,000
Total net income from other investments $ 479,000 $ 80,000 $ 654,000 $ 371,000
v3.19.3
STOCK OPTIONS (Tables)
9 Months Ended
Sep. 30, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Share-based Compensation, Stock Options, Activity [Table Text Block]
The following table summarizes stock option activity during the nine months ended September 30, 2019:
 
 
 
 
 
 
Weighted
 
 
 
 
 
 
Average
 
 
 
Options
 
 
Exercise
 
 
 
Outstanding
 
 
Price
 
Outstanding at January 1, 2019
 
 
1,600
 
 
$
15.30
 
Exercised
 
 
-
 
 
 
-
 
Forfeited
 
 
-
 
 
 
-
 
Expired unexercised
 
 
-
 
 
 
-
 
Granted options
 
 
8,000
 
 
 
13.20
 
Outstanding at September 30, 2019
 
 
9,600
 
 
$
13.55
 
Schedule of Share-based Compensation, Shares Authorized under Stock Option Plans, by Exercise Price Range [Table Text Block]
The following table summarizes information concerning outstanding and exercisable options as of September 30, 2019:
 
 
 
Number of
 
securities to be
issued upon 
exercise of
outstanding options 
 
 
Weighted-average
 
exercise price of
outstanding options 
 
 
Number of securities
 
remaining available for future
issuance under equity 
compensation plans 
 
Equity compensation plan approved by shareholders
 
 
9,600
 
 
$
13.55
 
 
 
36,608
 
Equity compensation plan not approved by shareholders
 
 
 
 
 
 
 
 
 
Total
 
 
9,600
 
 
$
13.55
 
 
 
36,608
 
v3.19.3
INCOME TAXES (Details) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Current:        
Federal     $ 0 $ 0
State     0 0
Total     0 0
Deferred:        
Federal     13,000 43,000
State     2,000 10,000
Total     15,000 53,000
Increased valuation allowance     0 7,000
Total $ 12,010 $ 26,532 $ 14,954 $ 60,111
v3.19.3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Details) - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure $ 18,813,000 $ 22,454,000
Fair Value, Inputs, Level 1 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 18,293,000 21,597,000
Fair Value, Inputs, Level 2 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 520,000 857,000
Fair Value, Inputs, Level 3 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
Time Deposits [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure   355,000
Time Deposits [Member] | Fair Value, Inputs, Level 1 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure   0
Time Deposits [Member] | Fair Value, Inputs, Level 2 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure   355,000
Time Deposits [Member] | Fair Value, Inputs, Level 3 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure   0
Money Market Mutual Funds [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 1,040,000 1,594,000
Money Market Mutual Funds [Member] | Fair Value, Inputs, Level 1 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 1,040,000 1,594,000
Money Market Mutual Funds [Member] | Fair Value, Inputs, Level 2 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
Money Market Mutual Funds [Member] | Fair Value, Inputs, Level 3 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
U S T bills [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 14,282,000 17,429,000
U S T bills [Member] | Fair Value, Inputs, Level 1 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 14,282,000 17,429,000
U S T bills [Member] | Fair Value, Inputs, Level 2 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
U S T bills [Member] | Fair Value, Inputs, Level 3 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
Corporate Debt Securities [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 520,000 502,000
Corporate Debt Securities [Member] | Fair Value, Inputs, Level 1 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
Corporate Debt Securities [Member] | Fair Value, Inputs, Level 2 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 520,000 502,000
Corporate Debt Securities [Member] | Fair Value, Inputs, Level 3 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
Marketable Equity Securities [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 2,971,000 2,574,000
Marketable Equity Securities [Member] | Fair Value, Inputs, Level 1 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 2,971,000 2,574,000
Marketable Equity Securities [Member] | Fair Value, Inputs, Level 2 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure 0 0
Marketable Equity Securities [Member] | Fair Value, Inputs, Level 3 [Member]    
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Cash and Cash Equivalents, Fair Value Disclosure $ 0 $ 0
v3.19.3
INVESTMENTS IN MARKETABLE SECURITIES (Details Textual) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Mar. 31, 2019
Dec. 31, 2018
Marketable Securities [Line Items]            
Marketable Securities Gain $ 19,000 $ 44,000 $ 66,000 $ 68,000    
Marketable Securities Loss 2,000 5,000 60,000 33,000    
Marketable Securities 3,491,531   3,491,531   $ 300,000 $ 3,075,718
Net realized gain (loss) from sales of securities 17,000 $ 39,000 6,000 $ 35,000    
Real Estate Investment Trusts [Member]            
Marketable Securities [Line Items]            
Marketable Securities $ 1,900,000   $ 1,900,000     $ 1,760,000
v3.19.3
INCOME TAXES (Tables)
9 Months Ended
Sep. 30, 2019
Income Tax Disclosure [Abstract]  
Schedule of Components of Income Tax Expense (Benefit) [Table Text Block]
The provision for income taxes in the consolidated statements of comprehensive income consists approximately of the following:
 
Nine months ended September 30,
 
2019
 
 
2018
 
Current:
 
 
 
 
 
 
 
 
Federal
 
$
-
 
 
$
-
 
State
 
 
-
 
 
 
-
 
 
 
 
-
 
 
 
-
 
Deferred:
 
 
 
 
 
 
 
 
Federal
 
$
13,000
 
 
$
43,000
 
State
 
 
2,000
 
 
 
10,000
 
 
 
 
15,000
 
 
 
53,000
 
Increased valuation allowance
 
 
-
 
 
 
7,000
 
Total
 
$
15,000
 
 
$
60,000
 
v3.19.3
RECENT ACCOUNTING PRONOUNCEMENTS (Policies)
9 Months Ended
Sep. 30, 2019
Accounting Policies [Abstract]  
New Accounting Pronouncements, Policy [Policy Text Block]
In June 2018, the FASB issued ASU 2018-07, “Compensation – Stock Compensation (Topic 718).” ASU 2018-07 simplifies the accounting for nonemployee stock-based payment transactions. This ASU is effective for public entities for interim and annual reporting periods beginning after December 15, 2018, and early application is permitted. The adoption of this guidance on January 1, 2019 did not have an impact on the Company’s consolidated financial statements.
 
In February 2016, the FASB issued ASU 2016-02, “Leases,” which created a new Topic, ASC Topic 842 and established the core principle that a lessee should recognize the assets, representing rights-of-use, and liabilities to make lease payments that arise from leases. For leases with a term of 12 months or less, a lessee is permitted to make an election under which such assets and liabilities would not be recognized, and lease expense would be recognized generally on a straight-line basis over the lease term. This ASU is effective for public entities for interim and annual reporting periods beginning after December 15, 2018, and early application is permitted. The adoption of this guidance on January 1, 2019 did not have an impact on the Company’s consolidated financial statements.
 
The Company does not believe that any recently issued, but not yet effective accounting standards, if currently adopted, will have a material effect on the Company’s consolidated financial position, results of operations and cash flows.
v3.19.3
OTHER INVESTMENTS
9 Months Ended
Sep. 30, 2019
Investments, All Other Investments [Abstract]  
Investments and Other Noncurrent Assets [Text Block]
5.
OTHER INVESTMENTS
 
 
 
 
As of September 30, 2019, the Company’s portfolio of other investments had an aggregate carrying value of approximately $5.9 million and we have committed to fund approximately $919,000 as required by agreements with the investees. The carrying value of these investments is equal to contributions less distributions and loss valuation adjustments, if any.
 
During the nine months ended September 30, 2019, we m
a
de cash contributions to other investments of approximately $920,000. This consisted of $700,000 in three new investments.  One in February 2019 for $200,000 in a partnership which holds residential mortgages acquired from a bank at discount, one in June 2019 for $300,000 in a partnership that is constructing residential apartments in Atlanta, GA and one in July 2019 for $200,000 in a real estate private lending fund.  We also made follow on contributions to existing investments of approximately $220,000.
 
During the nine months ended September 30, 2019, we received cash distributions from other investments of approximately $1,436,000.  This consisted of distributions from exis
t
ing investments (primarily real estate related), including $563,000 received in September 2019 from a partnership which sold its sole asset, a multifamily residential property located in Austin, Texas.  We recognized a gain of $429,000 on this investment, before incentive fee.  In August 2019, we redeemed a stock fund for $316,000 and recognized a gain of $66,000, before incentive fee. Also, in the first quarter of 2019 the Company’s $300,000 investments in a private insurance company publicly registered all shares and began trading on the NASDAQ on March 29, 2019.  Accordingly, we have transferred this investment to marketable securities.  As of September 30, 2019, this investment had an unrealized loss of approximately $98,000.
 
Net income from other investments for the three and nine months ended September 30, 2019 and 2018, is approximately as follows:
 
 
 
Three months ended
September 30,
 
 
Nine months ended
September 30,
 
Description
 
2019
 
 
2018
 
 
2019
 
 
2018
 
Partnerships owning real estate and related
 
$
409,000
 
 
$
26,000
 
 
$
536,000
 
 
$
191,000
 
Partnerships owning diversified businesses
 
 
61,000
 
 
 
29,000
 
 
 
97,000
 
 
 
70,000
 
Other (bank stocks)  
 
 
-
 
 
 
-
 
 
 
-
 
 
 
34,000
 
Income from investment in 49% owned affiliate (T.G.I.F. Texas, Inc.)
 
 
9,000
 
 
 
25,000
 
 
 
21,000
 
 
 
76,000
 
Total net income from other investments
 
$
479,000
 
 
$
80,000
 
 
$
654,000
 
 
$
371,000
 
 
 
 
 
 
 
 
 
 
The following tables present approximate gross unrealized losses and fair values for those investments that were in an unrealized loss position as of September 30, 2019 and December 31, 2018, aggregated by investment category and the length of time that investments have been in a continuous loss position:
 
 
 
As of September 30, 2019
 
 
 
12 Months or Less
 
 
Greater than 12 Months
 
 
Total
 
Investment Description
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
Partnerships owning investments in technology related industries
 
$
-
 
 
$
-
 
 
$
150,000
 
 
$
(11,000
)
 
$
150,000
 
 
$
(11,000
)
Partnerships owning investments in diversified businesses
 
 
513,000
 
 
 
(30,000
)
 
 
-
 
 
 
-
 
 
 
513,000
 
 
 
(30,000
)
Total
 
$
513,000
 
 
$
(30,000
)
 
$
150,000
 
 
$
(11,000
)
 
$
663,000
 
 
$
(41,000
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2018
 
 
 
12 Months or Less
 
 
Greater than 12 Months
 
 
Total
 
Investment Description
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
Partnerships owning investments in technology related industries
 
$
-
 
 
$
-
 
 
$
132,000
 
 
$
(18,000
)
 
$
132,000
 
 
$
(18,000
)
Partnerships owning investments in diversified businesses
 
 
273,00
 
 
 
(27,000
)
 
 
 
 
 
 
 
 
 
 
273,000
 
 
 
(27,000
)
Total
 
$
273,000
 
 
 
(27,000
)
 
 
132,000
 
 
$
(18,000
)
 
$
405,000
 
 
$
(45,000
)
 
 
 
 
 
 
 
 
 
When evaluating the investments for other-than-temporary impairment, the Company reviews factors such as the length of time and extent to which fair value has been below cost basis, the financial condition of the issuer and any changes thereto, and the Company’s intent to sell, or whether it is more likely than not it will be required to sell, the investment before recovery of the investment’s amortized cost basis.
 
In accordance with ASC Topic 320-10-65, Recognition and Pre
s
entation of Other-Than-Temporary Impairments there were no impairment valuation adjustments for the three and nine months ended September 30, 2019 and 2018.
v3.19.3
STOCK OPTIONS (Details)
9 Months Ended
Sep. 30, 2019
$ / shares
shares
Options Outstanding  
Outstanding at Beginning | shares 1,600
Exercised | shares 0
Forfeited | shares 0
Expired unexercised | shares 0
Granted options | shares 8,000
Outstanding at the end of the period | shares 9,600
Weighted Average Exercise Price  
Outstanding at Beginning | $ / shares $ 15.30
Exercised | $ / shares 0
Forfeited | $ / shares 0
Expired unexercised | $ / shares 0
Granted options | $ / shares 13.20
Outstanding at Ending | $ / shares $ 13.55
v3.19.3
Cover Page - shares
9 Months Ended
Sep. 30, 2019
Nov. 13, 2019
Cover [Abstract]    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Sep. 30, 2019  
Document Fiscal Year Focus 2019  
Document Fiscal Period Focus Q3  
Trading Symbol HMG  
Entity Registrant Name HMG COURTLAND PROPERTIES INC  
Entity Central Index Key 0000311817  
Current Fiscal Year End Date --12-31  
Entity Current Reporting Status Yes  
Entity Filer Category Non-accelerated Filer  
Entity Common Stock, Shares Outstanding   1,013,292
Entity Interactive Data Current Yes  
Entity Shell Company false  
Entity Small Business true  
Entity Emerging Growth Company false  
Title of 12(b) Security Common Stock  
Security Exchange Name NYSE  
Entity Address, State or Province FL  
v3.19.3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY - USD ($)
Total
Common Stock [Member]
Additional Paid-in Capital [Member]
Undistributed Gains from Sales of Properties Net of Losses [Member]
Undistributed Losses from Operations [Member]
Treasury Stock [Member]
Balance at Dec. 31, 2017 $ 19,859,966 $ 1,035,493 $ 24,076,991 $ 52,208,753 $ (57,120,990) $ (340,281)
Balance (in shares) at Dec. 31, 2017   1,035,493       33,101
Net income (loss) 5,190,893 $ 0 0 5,473,887 (282,994) $ 0
Stock options exercised, net of 1,600 re-load shares 91,895 $ 10,900 80,995 0 0 0
Stock options exercised, net of 1,600 re-load shares (in shares)   10,900        
Dividend paid -$2.50 per share (2,533,230) $ 0 0 (2,533,230) 0 0
Balance at Mar. 31, 2018 22,609,524 $ 1,046,393 24,157,986 55,149,410 (57,403,984) $ (340,281)
Balance (in shares) at Mar. 31, 2018   1,046,393       33,101
Balance at Dec. 31, 2017 19,859,966 $ 1,035,493 24,076,991 52,208,753 (57,120,990) $ (340,281)
Balance (in shares) at Dec. 31, 2017   1,035,493       33,101
Net income (loss) 4,615,312          
Retired 33,101 treasury shares 0          
Balance at Sep. 30, 2018 22,033,944 $ 1,046,393 24,157,986 55,149,410 (57,979,564) $ (340,281)
Balance (in shares) at Sep. 30, 2018   1,046,393       33,101
Balance at Mar. 31, 2018 22,609,524 $ 1,046,393 24,157,986 55,149,410 (57,403,984) $ (340,281)
Balance (in shares) at Mar. 31, 2018   1,046,393       33,101
Net income (loss) (74,240) $ 0 0 0 (74,240) $ 0
Balance at Jun. 30, 2018 22,535,284 $ 1,046,393 24,157,986 55,149,410 (57,478,224) $ (340,281)
Balance (in shares) at Jun. 30, 2018   1,046,393       33,101
Net income (loss) (501,340) $ 0 0 0 (501,340) $ 0
Balance at Sep. 30, 2018 22,033,944 $ 1,046,393 24,157,986 55,149,410 (57,979,564) $ (340,281)
Balance (in shares) at Sep. 30, 2018   1,046,393       33,101
Balance at Dec. 31, 2018 21,033,055 $ 1,046,393 24,157,986 54,642,764 (58,473,807) $ (340,281)
Balance (in shares) at Dec. 31, 2018   1,046,393       33,101
Net income (loss) (11,116) $ 0 0 0 (11,116) $ 0
Balance at Mar. 31, 2019 21,021,939 $ 1,046,393 24,157,986 54,642,764 (58,484,923) $ (340,281)
Balance (in shares) at Mar. 31, 2019   1,046,393       33,101
Balance at Dec. 31, 2018 21,033,055 $ 1,046,393 24,157,986 54,642,764 (58,473,807) $ (340,281)
Balance (in shares) at Dec. 31, 2018   1,046,393       33,101
Net income (loss) $ 337,155          
Stock options exercised, net of 1,600 re-load shares (in shares) 0          
Retired 33,101 treasury shares $ 340,281          
Balance at Sep. 30, 2019 21,379,090 $ 1,013,292 23,859,686 54,642,764 (58,136,652) $ 0
Balance (in shares) at Sep. 30, 2019   1,013,292        
Balance at Mar. 31, 2019 21,021,939 $ 1,046,393 24,157,986 54,642,764 (58,484,923) $ (340,281)
Balance (in shares) at Mar. 31, 2019   1,046,393       33,101
Net income (loss) 9,550 $ 0 0 0 9,550 $ 0
Retired 33,101 treasury shares $ 0 $ (33,101) (307,180) 0 0 $ 340,281
Retired 33,101 treasury shares (in shares) 33,101 (33,101)       (33,101)
Balance at Jun. 30, 2019 $ 21,031,489 $ 1,013,292 23,850,806 54,642,764 (58,475,373) $ 0
Balance (in shares) at Jun. 30, 2019   1,013,292       0
Net income (loss) 338,721 $ 0 0 0 338,721 $ 0
Stock compensation expense 8,880   8,880      
Balance at Sep. 30, 2019 $ 21,379,090 $ 1,013,292 $ 23,859,686 $ 54,642,764 $ (58,136,652) $ 0
Balance (in shares) at Sep. 30, 2019   1,013,292        
v3.19.3
RECENT ACCOUNTING PRONOUNCEMENTS
9 Months Ended
Sep. 30, 2019
New Accounting Pronouncements and Changes in Accounting Principles [Abstract]  
New Accounting Pronouncements and Changes in Accounting Principles [Text Block]
2.
RECENT ACCOUNTING PRONOUNCEMENTS
 
In June 2018, the FASB issued ASU 2018-07, “Compensation – Stock Compensation (Topic 718).” ASU 2018-07 simplifies the accounting for nonemployee stock-based payment transactions. This ASU is effective for public entities for interim and annual reporting periods beginning after December 15, 2018, and early application is permitted. The adoption of this guidance on January 1, 2019 did not have an impact on the Company’s consolidated financial statements.
 
In February 2016, the FASB issued ASU 2016-02, “Leases,” which created a new Topic, ASC Topic 842 and established the core principle that a lessee should recognize the assets, representing rights-of-use, and liabilities to make lease payments that arise from leases. For leases with a term of 12 months or less, a lessee is permitted to make an election under which such assets and liabilities would not be recognized, and lease expense would be recognized generally on a straight-line basis over the lease term. This ASU is effective for public entities for interim and annual reporting periods beginning after December 15, 2018, and early application is permitted. The adoption of this guidance on January 1, 2019 did not have an impact on the Company’s consolidated financial statements.
 
The Company does not believe that any recently issued, but not yet effective accounting standards, if currently adopted, will have a material effect on the Company’s consolidated financial position, results of operations and cash flows.
v3.19.3
OTHER INVESTMENTS (Details 1) - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Fair Value    
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value $ 513,000 $ 273,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value 150,000 132,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total 663,000 405,000
Unrealized    
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Loss (30,000) (27,000)
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss (11,000) (18,000)
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Loss (41,000) (45,000)
Partnerships Owning Investments In Technology Related Industries [Member]    
Fair Value    
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value 0 0
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value 150,000 132,000
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total 150,000 132,000
Unrealized    
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Loss 0 0
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss (11,000) (18,000)
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Loss (11,000) (18,000)
Partnerships owning investments in diversified businesses [Member]    
Fair Value    
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than Twelve Months, Fair Value 513,000 27,300
Available-for-sale Securities, Continuous Unrealized Loss Position, Twelve Months or Longer, Fair Value 0  
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value, Total 513,000 273,000
Unrealized    
Available-for-sale Securities, Continuous Unrealized Loss Position, Less than 12 Months, Aggregate Loss (30,000) (27,000)
Available-for-sale Securities, Continuous Unrealized Loss Position, 12 Months or Longer, Aggregate Loss 0  
Available-for-sale Securities, Continuous Unrealized Loss Position, Aggregate Loss $ (30,000) $ (27,000)
v3.19.3
INVESTMENT IN RESIDENTIAL REAL ESTATE PARTNERSHIP (FORT MYERS, FL) (Details Textual)
1 Months Ended
Oct. 08, 2019
USD ($)
Jul. 19, 2019
USD ($)
a
ft²
units
Number of Units in Real Estate Property | units   318
PNC Bank National Association [Member]    
Equity Method Investment, Underlying Equity in Net Assets   $ 14,490,000
Debt Instrument, Face Amount   41,590,000
Murano At Three Oaks Associates LLC [Member]    
Equity Method Investment, Underlying Equity in Net Assets   $ 3,620,000
Equity Method Investment, Ownership Percentage   25.00%
Fort Myers Florida [Member]    
Guarantor Obligations Financial Compliance Covenants   Each Guarantor is required to maintain compliance with the following financial covenants, as defined: (1) liquidity shall not be less than $2.5 million. Liquidity is defined as the sum of unencumbered, unrestricted cash and cash equivalents and marketable securities, and (2) net worth shall not be less than $10 million.
Development Costs, Period Cost   $ 56,080,000
Area Of Land Available For Renting | ft²   312,000
Area of Land | a   17.5
Fort Myers Florida [Member] | Construction Contracts [Member]    
Guarantor Obligations, Term   HMG and the other members (or affiliates thereof) of the Borrower ("Guarantors") entered into a Completion Guaranty ("Completion Guaranty") and a Guaranty and Suretyship Agreement ("Repayment Guaranty") (collectively, the “Guaranties”). Under the Completion Guaranty, each Guarantor shall unconditionally guaranty, as a primary obligor, and become surety for the prompt payment and performance by Borrower of the “Guaranteed Obligations” (as defined). Under the Repayment Guaranty, Guarantor unconditionally guarantees, as a primary obligor, and becomes surety for the prompt payment and performance of, as defined (i) all Interest Obligations, (ii) all Loan Document Obligations, (iii) all Expense Obligations, (iv) the Carrying Cost Obligations, (v) the Principal Amount, (vi) interest on each of the foregoing including, if applicable, interest at the Default Rate (as defined). At all times prior to the First Reduction Date (as defined below), the Guarantors are collectively responsible for 30% of the Principal Obligations, (ii) at all times after the First Reduction Date, the Guarantors are collectively responsible for15% of the Principal Obligations, and (iii) at all times after the Second Reduction Date, 0% of the Principal Obligations. First Reduction Conditions" means satisfaction of the following conditions: (i) no Event of Default has occurred and is continuing; (ii) Completion of Construction has occurred; and (iii) the Project has achieved a DSCR of not less than 1.25 to 1.00 for two (2) consecutive fiscal quarters.
Subsequent Event [Member]    
Payments To Acquire Residential Real Estate $ 423,000  
v3.19.3
STOCK OPTIONS (Details Textual)
9 Months Ended
Sep. 30, 2019
USD ($)
$ / shares
shares
Share-based Compensation Arrangements by Share-based Payment Award, Options, Grants in Period, Weighted Average Exercise Price $ 13.20
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Gross | shares 8,000
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Date Jun. 29, 2021
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Term 2 years
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Volatility Rate 19.50%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Risk Free Interest Rate 1.93%
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Expected Dividend Rate 4.00%
Share-based Compensation Arrangement by Share-based Payment Award, Options, Grants in Period, Weighted Average Grant Date Fair Value $ 1.11
Allocated Share-based Compensation Expense | $ $ 9,000
v3.19.3
INCOME TAXES
9 Months Ended
Sep. 30, 2019
Income Tax Disclosure [Abstract]  
Income Tax Disclosure [Text Block]
7.
INCOME TAXES
 
The Company as a qualifying real estate investment trust (“REIT”) distributes its taxable ordinary income to stockholders in conformity with requirements of the Internal Revenue Code and is not required to report deferred items due to its ability to distribute all taxable income. In addition, net operating losses can be carried forward to reduce future taxable income but cannot be carried back.
 
The Company’s 95%-owned taxable REIT subsidiary, CII, files a separate income tax return and its operations are not included in the REIT’s income tax return.
 
Distributed capital g
a
ins on sales of real estate as they relate to REIT activities are not subject to taxes; however, undistributed capital gains may be subject to corporate tax.
 
On December 14, 2018 the Company declared a capital gain dividend of $0.50 per share which was payable on January 9, 2019 to all shareholders of record as of December 28, 2018.
 
The Company accounts for income taxes in accordance with ASC Topic 740, “Accounting for Income Taxes.” ASC Topic 740 requires a Company to use the asset and liability method of accounting for income taxes. Under this method, deferred income taxes are recognized for the tax consequences of “temporary differences” by applying enacted statutory tax rates applicable to future years to differences between the financial statement carrying amounts and the tax basis of existing assets and liabilities. The effect on deferred income taxes of a change in tax rates is recognized in income in the period that includes the enactment date. Deferred taxes only pertain to CII. As of September 30, 2019, and December 31, 2018, the Company has recorded a net deferred tax liability of $63,000 and $48,000, respectively, primarily as a result of timing differences associated with the carrying value of the investment in affiliate (TGIF) and other investments. CII’s NOL carryover to 2019 is approximately at $
1
million and has been fully reserved due to CII historically having tax losses.
 
The provision for income taxes in the consolidated statements of comprehensive income consists approximately of the following:
 
Nine months ended September 30,
 
2019
 
 
2018
 
Current:
 
 
 
 
 
 
 
 
Federal
 
$
-
 
 
$
-
 
State
 
 
-
 
 
 
-
 
 
 
 
-
 
 
 
-
 
Deferred:
 
 
 
 
 
 
 
 
Federal
 
$
13,000
 
 
$
43,000
 
State
 
 
2,000
 
 
 
10,000
 
 
 
 
15,000
 
 
 
53,000
 
Increased valuation allowance
 
 
-
 
 
 
7,000
 
Total
 
$
15,000
 
 
$
60,000
 
 
The Company follows the provisions of ASC Topic 740-10, “Accounting for Uncertainty in Income Taxes” which clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements in accordance with ASC Topic 740 and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. This topic also provides guidance on de-recognition, classification, interest and penalties, accounting in interim periods, disclosure and transition.
 
Based on our evaluation, we have concluded that there are no significant uncertain tax positions requiring recognition in our consolidated financial statements. Our evaluation was performed for the tax years ended December 31, 2018. The Company’s federal income tax returns since 2014 are subject to examination by the Internal Revenue Service, generally for a period of three years after the returns were filed.
  
We may from time to time be assessed interest or penalties by major tax jurisdictions, although any such assessments historically have been minimal and immaterial to our financial results. In the event we have received an assessment for interest and/or penalties, it has been classified in the consolidated financial statements as selling, general and administrative expense.
v3.19.3
INVESTMENT IN RESIDENTIAL REAL ESTATE PARTNERSHIP (FORT MYERS, FL)
9 Months Ended
Sep. 30, 2019
Investment In Real Estate Partnership [Abstract]  
Investment In Real Estate Partnership [Text Block]
3.
INVESTMENT IN RESIDENTIAL REAL ESTATE PARTNERSHIP (FORT MYERS, FL)
 
As previously reported on Form 8-K dated July 19, 2019, pursuant to the terms of a Construction and Mini Perm Loan Agreement ("Loan Agreement"), between Murano At Three Oaks Associates LLC, a Florida limited liability company formed in September 2018 (the “Borrower”) which is 25% owned by HMG, and PNC Bank, National Association ("Lender"), Lender provided a construction loan to the Borrower for the principal sum of approximately $41.59 million (“Loan”). The proceeds of the Loan shall be used to finance the construction of multi-family residential apartments containing 318 units totaling approximately 312,000 net rentable square feet on a 17.5-acre site located in Fort Myers, Florida ("Project").  The Project site was purchased by the Borrower concurrently with the closing of the Loan. Total development costs for the Project are estimated at approximately $56.08 million and the Borrower’s equity totals approximately $14.49 million. HMG’s share of the equity is 25%, or approximately $3.62 million, all of which has been funded to date including approximately $423,000 funded on October 8, 2019.
Construction activities on the Project site began in August 2019.
 
There is no outstanding amount on the loan as of September 30, 2019. 
 
 
HMG and the other members (or affiliates thereof) of the Borrower ("Guarantors") entered into a Completion Guaranty ("Completion Guaranty") and a Guaranty and Suretyship Agreement ("Repayment Guaranty") (collectively, the “Guaranties”). Under the Completion Guaranty, each Guarantor shall unconditionally guaranty, as a primary obligor, and become surety for the prompt payment and performance by Borrower of the “Guaranteed Obligations” (as defined). Under the Repayment Guaranty, Guarantor unconditionally guarantees, as a primary obligor, and becomes surety for the prompt payment and performance of, as defined (i) all Interest Obligations, (ii) all Loan Document Obligations, (iii) all Expense Obligations, (iv) the Carrying Cost Obligations, (v) the Principal Amount, (vi) interest on each of the foregoing including, if applicable, interest at the Default Rate (as defined). At all times prior to the First Reduction Date (as defined below), the Guarantors are collectively responsible for 30% of the Principal Obligations, (ii) at all times after the First Reduction Date, the Guarantors are collectively responsible for15% of the Principal Obligations, and (iii) at all times after the Second Reduction Date, 0% of the Principal Obligations. First Reduction Conditions" means satisfaction of the following conditions: (i) no Event of Default has occurred and is continuing; (ii) Completion of Construction has occurred; and (iii) the Project has achieved a DSCR of not less than 1.25 to 1.00 for two (2) consecutive fiscal quarters.
 
Each Guarantor is required to maintain compliance with the following financial covenants, as defined: (1) liquidity shall not be less than $2.5 million. Liquidity is defined as the sum of unencumbered, unrestricted cash and cash equivalents and marketable securities, and (2) net worth shall not be less than $10 million.
  As of September 30, 2019, HMG was in compliance with all covenants required by Guarantors in the Loan Agreement.
v3.19.3
OTHER INVESTMENTS (Tables)
9 Months Ended
Sep. 30, 2019
Investments, All Other Investments [Abstract]  
Investment Holdings, Schedule of Investments [Table Text Block]
Net income from other investments for the three and nine months ended September 30, 2019 and 2018, is approximately as follows:
 
 
 
Three months ended
September 30,
 
 
Nine months ended
September 30,
 
Description
 
2019
 
 
2018
 
 
2019
 
 
2018
 
Partnerships owning real estate and related
 
$
409,000
 
 
$
26,000
 
 
$
536,000
 
 
$
191,000
 
Partnerships owning diversified businesses
 
 
61,000
 
 
 
29,000
 
 
 
97,000
 
 
 
70,000
 
Other (bank stocks)  
 
 
-
 
 
 
-
 
 
 
-
 
 
 
34,000
 
Income from investment in 49% owned affiliate (T.G.I.F. Texas, Inc.)
 
 
9,000
 
 
 
25,000
 
 
 
21,000
 
 
 
76,000
 
Total net income from other investments
 
$
479,000
 
 
$
80,000
 
 
$
654,000
 
 
$
371,000
 
 
 
 
 
 
 
 
 
Available-for-sale Securities, Continuous Unrealized Loss Position, Fair Value [Table Text Block]
The following tables present approximate gross unrealized losses and fair values for those investments that were in an unrealized loss position as of September 30, 2019 and December 31, 2018, aggregated by investment category and the length of time that investments have been in a continuous loss position:
 
 
 
As of September 30, 2019
 
 
 
12 Months or Less
 
 
Greater than 12 Months
 
 
Total
 
Investment Description
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
Partnerships owning investments in technology related industries
 
$
-
 
 
$
-
 
 
$
150,000
 
 
$
(11,000
)
 
$
150,000
 
 
$
(11,000
)
Partnerships owning investments in diversified businesses
 
 
513,000
 
 
 
(30,000
)
 
 
-
 
 
 
-
 
 
 
513,000
 
 
 
(30,000
)
Total
 
$
513,000
 
 
$
(30,000
)
 
$
150,000
 
 
$
(11,000
)
 
$
663,000
 
 
$
(41,000
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
As of December 31, 2018
 
 
 
12 Months or Less
 
 
Greater than 12 Months
 
 
Total
 
Investment Description
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
 
Fair Value
 
 
Unrealized
Loss
 
Partnerships owning investments in technology related industries
 
$
-
 
 
$
-
 
 
$
132,000
 
 
$
(18,000
)
 
$
132,000
 
 
$
(18,000
)
Partnerships owning investments in diversified businesses
 
 
273,00
 
 
 
(27,000
)
 
 
 
 
 
 
 
 
 
 
273,000
 
 
 
(27,000
)
Total
 
$
273,000
 
 
 
(27,000
)
 
 
132,000
 
 
$
(18,000
)
 
$
405,000
 
 
$
(45,000
)
 
 
 
 
 
 
 
 
v3.19.3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares
Sep. 30, 2019
Dec. 31, 2018
Stockholders' Equity, Number of Shares, Par Value and Other Disclosures [Abstract]    
Excess common stock, par value $ 1 $ 1
Excess common stock, shares authorised 100,000 100,000
Excess common stock, shares issued 0 0
Common stock par value $ 1 $ 1
Common Stock, Shares Authorized 1,050,000 1,050,000
Common Stock, Shares, Issued 1,013,292 1,046,393
Treasury Stock, Shares   33,101
v3.19.3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($)
9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income attributable to the Company $ 337,155 $ 4,615,312
Adjustments to reconcile net income attributable to the Company to net cash used in operating activities:    
Depreciation expense 11,548 11,548
Stock compensation expense 8,880 0
Net income from other investments, excluding impairment losses (654,239) (370,616)
Equity (gain) on sale of property in residential real estate partnership 0 (5,473,887)
Equity (gain) loss from operations of residential real estate partnership (3,225) 143,890
Net (gains) from investments in marketable securities (252,747) (26,291)
Net gain attributable to non-controlling interest 9,308 14,010
Deferred income tax expense 15,450 60,111
Changes in assets and liabilities:    
Other assets and other receivables (7,616) 62,942
Accounts payable, accrued expenses and other liabilities (1,785) (223,636)
Total adjustments (874,426) (5,801,929)
Net cash used in operating activities (537,271) (1,186,617)
CASH FLOWS FROM INVESTING ACTIVITIES:    
Net proceeds from sales and redemptions of securities 1,096,670 1,140,259
Investments in marketable securities (959,737) (1,379,385)
Distribution from investment in residential real estate partnership, Orlando, FL 6,187 7,525,000
Contributions to investment residential real estate partnership, Fort Myers, FL (3,000,000) (200,000)
Distributions from other investments 1,435,879 1,560,667
Contributions to other investments (919,613) (1,079,783)
Proceeds from collections of mortgage loans and notes receivables 0 500,000
Distribution from affiliate 220,899 193,286
Purchases and improvements of properties (66,162) (26,097)
Net cash (used in) provided by investing activities (2,185,877) 8,233,947
CASH FLOWS FROM FINANCING ACTIVITIES:    
Margin borrowings 68,754 9,725,280
Dividend paid (506,646) (2,533,230)
Repayment of note payable to affiliate (340,000) (210,000)
Proceeds from stock options exercised 0 91,895
Net cash (used in) provided by financing activities (777,892) 7,073,945
Net (decrease) increase in cash and cash equivalents (3,501,040) 14,121,275
Cash and cash equivalents at beginning of the period 19,738,174 5,223,995
Cash and cash equivalents at end of the period 16,237,134 19,345,270
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:    
Cash paid during the period for interest 43,000 68,000
NON-CASH INVESTING AND FINANCING ACTIVITIES:    
Retirement of treasury stock during the period $ 340,281 $ 0
v3.19.3
STOCK OPTIONS (Details 1) - $ / shares
Sep. 30, 2019
Dec. 31, 2018
Number of securities to be issued upon exercise of outstanding options 9,600 1,600
Weighted-average exercise price of outstanding options $ 13.55 $ 15.30
Number of securities remaining available for future issuance under equity compensation plans 36,608  
Equity compensation plan approved by shareholders [Member]    
Number of securities to be issued upon exercise of outstanding options 9,600  
Weighted-average exercise price of outstanding options $ 13.55  
Number of securities remaining available for future issuance under equity compensation plans 36,608  
Equity compensation plan not approved by shareholders [Member]    
Number of securities to be issued upon exercise of outstanding options 0  
Weighted-average exercise price of outstanding options $ 0  
Number of securities remaining available for future issuance under equity compensation plans 0  
v3.19.3
FAIR VALUE OF FINANCIAL INSTRUMENTS (Tables)
9 Months Ended
Sep. 30, 2019
Fair Value Disclosures [Abstract]  
Fair Value, by Balance Sheet Grouping [Table Text Block]
Assets and liabilities measured at fair value on a recurring basis are summarized below:
 
 
 
Fair value measurement at reporting date using
 
Description
 
Total
 
September 30,
2019 
 
 
Quoted Prices in Active
 
Markets for Identical Assets
(Level 1) 
 
 
Significant Other
 
Observable Inputs
(Level 2) 
 
 
Significant
 
Unobservable Inputs
(Level 3) 
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash equivalents:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Money market mutual funds
 
$
1,040,000
 
 
$
1,040,000
 
 
 
-
 
 
$
-
 
US T-Bills
 
 
14,282,000
 
 
 
14,282,000
 
 
 
-
 
 
 
-
 
Marketable securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities
 
 
520,000
 
 
 
-
 
 
$
520,000
 
 
 
-
 
Marketable equity securities
 
 
2,971,000
 
 
 
2,971,000
 
 
 
-
 
 
 
-
 
Total assets
 
$
18,813,000
 
 
$
18,293,000
 
 
$
520,000
 
 
$
-
 
 
 
 
Fair value measurement at reporting date using
 
Description
 
Total
 
December 31,
2018 
 
 
Quoted Prices in Active
 
Markets for Identical Assets
(Level 1) 
 
 
Significant Other
 
Observable Inputs
(Level 2) 
 
 
Significant
 
Unobservable Inputs
(Level 3) 
 
Assets:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash equivalents:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Time deposits
 
$
355,000
 
 
$
-
 
 
$
355,000
 
 
$
-
 
Money market mutual funds
 
 
1,594,000
 
 
 
1,594,000
 
 
 
-
 
 
 
-
 
US T-Bills
 
 
17,429,000
 
 
 
17,429,000
 
 
 
-
 
 
 
-
 
Marketable securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Corporate debt securities
 
 
502,000
 
 
 
-
 
 
 
502,000
 
 
 
-
 
Marketable equity securities
 
 
2,574,000
 
 
 
2,574,000
 
 
 
-
 
 
 
-
 
Total assets
 
$
22,454,000
 
 
$
21,597,000
 
 
$
857,000
 
 
$
-
 
v3.19.3
STOCK OPTIONS
9 Months Ended
Sep. 30, 2019
Disclosure of Compensation Related Costs, Share-based Payments [Abstract]  
Disclosure of Compensation Related Costs, Share-based Payments [Text Block]
8.
STOCK OPTIONS
 
Stock based compensation expense is recognized u
s
ing the fair-value method for all awards. On July 25, 2019 the Company granted options to purchase 8,000 shares of the Company’s common stock to three directors and one officer.  The exercise price of the options is equal to $13.20 per share, the market price of the stock on the date of grant and the options expires on June 29, 2021.  The Company determined the fair value of its option awards using the Black-Scholes option pricing model.  The following assumptions were used to value the options granted during the nine months ended September 30, 2019: 2 year expected life; expected volatility of approximately 19.5%; risk-free of 1.93% and annual dividend yield of 4%.  The expected life for options granted during the period represents the period of time that options are to be outstanding based on the expiration date of the Plan.  Expected volatilities are based upon historical volatility of the Company’s stock over a period equal to the 2 year expected life.
 
The weighted average fair value for options granted d
u
ring the nine months ended September 30, 2019 was $
1.11
 per share.  For the nine months ended September 30, 2019 the Company recorded approximately $9,000 in stock expense
compensation 
relating to the options granted in 2019.
 
 
The following table summarizes stock option activity during the nine months ended September 30, 2019:
 
 
 
 
 
 
Weighted
 
 
 
 
 
 
Average
 
 
 
Options
 
 
Exercise
 
 
 
Outstanding
 
 
Price
 
Outstanding at January 1, 2019
 
 
1,600
 
 
$
15.30
 
Exercised
 
 
-
 
 
 
-
 
Forfeited
 
 
-
 
 
 
-
 
Expired unexercised
 
 
-
 
 
 
-
 
Granted options
 
 
8,000
 
 
 
13.20
 
Outstanding at September 30, 2019
 
 
9,600
 
 
$
13.55
 
 
The following table summarizes information concerning outstanding and exercisable options as of September 30, 2019:
 
 
 
Number of
 
securities to be
issued upon 
exercise of
outstanding options 
 
 
Weighted-average
 
exercise price of
outstanding options 
 
 
Number of securities
 
remaining available for future
issuance under equity 
compensation plans 
 
Equity compensation plan approved by shareholders
 
 
9,600
 
 
$
13.55
 
 
 
36,608
 
Equity compensation plan not approved by shareholders
 
 
 
 
 
 
 
 
 
Total
 
 
9,600
 
 
$
13.55
 
 
 
36,608
 
 
As of September 30, 2019, the stock options outstanding and exercisable had no intrinsic value.
v3.19.3
INVESTMENTS IN MARKETABLE SECURITIES
9 Months Ended
Sep. 30, 2019
Investments, Debt and Equity Securities [Abstract]  
Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]
4.
INVESTMENTS IN MARKETABLE SECURITIES
 
Investments in marketable securities consist primarily of l
a
rge capital corporate equity and debt securities in varying industries or issued by government agencies with readily determinable fair values. These securities are stated at market value, as determined by the most recent traded price of each security at the balance sheet date. Consistent with the Company's overall current investment objectives and activities its entire marketable securities portfolio is classified as trading. Accordingly, all unrealized gains (losses) on this portfolio are recorded in income.  Included in investments in marketable securities is approximately $1.90 million and $1.76 million of large capital real estate investment trusts (REITs) as of September 30, 2019 and December 31, 2018, respectively.
 
Net realized and unrealized gain from investments in marketable securities for the three and nine months ended September 30, 2019 and 2018 is summarized below:
 
 
 
Three months ended
September 30,
 
 
Nine months ended
September 30,
 
Description
 
2019
 
 
2018
 
 
2019
 
 
2018
 
Net realized gain from sales of securities
 
$
17,000
 
 
$
39,000
 
 
$
6,000
 
 
$
35,000
 
Unrealized net (loss) gain in trading securities
 
 
(5,000
)
 
 
(37,000
)
 
 
247,000
 
 
 
(9,000
)
Total net gain from investments in marketable securities
 
$
12,000
 
 
$
2,000
 
 
$
253,000
 
 
$
26,000
 
 
For the three months ended September 30, 2019, net realized gain from sales of marketable securities was approximately $17,000 which consisted of $19,000 of gross gains and $2,000 of gross losses. For the nine months ended September 30, 2019, net realized loss from sales of marketable securities was approximately $6,000 and consisted of approximately $66,000 of gross gains net of $60,000 of gross losses.
 
For the three months ended September 30, 2018, net realized gain from sales of marketable securities was approximately $39,000 of which approximately $44,000 consisted of gross gains and $5,000 of gross losses. For the nine months ended September 30, 2018, net realized gain from sales of marketable securities was approximately $35,000 and consisted of approximately $68,000 of gross gains net of $33,000 of gross losses.
 
Investment gains and losses on marketable securities may fluctuate significantly from period to period in the future and could have a significant impact on the Company's net earnings. However, the amount of investment gains or losses on marketable securities for any given period has no predictive value and variations in amount from period to period have no practical analytical value.
v3.19.3
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($)
Sep. 30, 2019
Dec. 31, 2018
Investment properties, net of accumulated depreciation:    
Office building and other commercial property $ 929,812 $ 875,198
Total investment properties, net 929,812 875,198
Cash and cash equivalents 16,237,134 19,738,174
Investments in marketable securities 3,491,531 3,075,718
Other investments 5,919,222 6,039,456
Investment in affiliate 1,437,632 1,637,985
Loans, notes and other receivables 1,799,055 1,796,926
Investment in residential real estate partnership 3,203,225 200,000
Other assets 72,779 73,477
TOTAL ASSETS 33,090,390 33,436,934
LIABILITIES    
Margin payable 9,926,672 9,857,918
Dividends payable 0 506,646
Accounts payable, accrued expenses and other liabilities 407,256 370,632
Amounts due to Adviser 64,356 40,426
Note payable to affiliate 1,000,000 1,340,000
Deferred income taxes payable 63,338 47,888
TOTAL LIABILITIES 11,461,622 12,163,510
STOCKHOLDERS' EQUITY    
Excess common stock, $1 par value; 100,000 shares authorized: no shares issued 0 0
Common stock, $1 par value; 1,050,000 shares authorized, 1,013,292 issued as of September 30, 2019 and 1,046,393 shares issued as of December 31, 2018 1,013,292 1,046,393
Additional paid-in capital 23,859,686 24,157,986
Less: Treasury shares at cost 33,101 shares 0 (340,281)
Undistributed gains from sales of properties, net of losses 54,642,764 54,642,764
Undistributed losses from operations (58,136,652) (58,473,807)
Total stockholders' equity 21,379,090 21,033,055
Noncontrolling interest 249,678 240,369
TOTAL EQUITY 21,628,768 21,273,424
TOTAL LIABILITIES AND EQUITY $ 33,090,390 $ 33,436,934
v3.19.3
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (Parenthetical)
3 Months Ended
Mar. 31, 2018
$ / shares
shares
Dividend Paid [Member]  
Dividends Paid, Amount Per Share | $ / shares $ 2.50
Common Stock Including Additional Paid in Capital [Member]  
Stock Issued During Period, Shares, New Issues | shares 1,600
v3.19.3
OTHER INVESTMENTS (Details Textual) - USD ($)
1 Months Ended 3 Months Ended 9 Months Ended
Jul. 31, 2019
Jun. 30, 2019
Feb. 28, 2019
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Mar. 31, 2019
Dec. 31, 2018
Other Investment [Line Items]                  
Other Investments       $ 5,919,222   $ 5,919,222     $ 6,039,456
Company committed to fund approximately as required by agreements with the investees       919,000   919,000      
Proceeds from Sale and Maturity of Other Investments           1,435,879 $ 1,560,667    
Payments to Acquire Other Investments           919,613 1,079,783    
Marketable Securities, Unrealized Gain (Loss)       (5,000) $ (37,000) 247,000 $ (9,000)    
Marketable Securities       $ 3,491,531   3,491,531   $ 300,000 $ 3,075,718
Other Investments [Member]                  
Other Investment [Line Items]                  
Marketable Securities, Unrealized Gain (Loss)           $ (98,000)      
TGIF Texas Inc [Member]                  
Other Investment [Line Items]                  
Equity Method Investment, Ownership Percentage       49.00%   49.00%      
Private Banks [Member]                  
Other Investment [Line Items]                  
Payments to Acquire Other Investments     $ 200,000            
Real Estate Private Lending Fund [Member]                  
Other Investment [Line Items]                  
Payments to Acquire Other Investments $ 200,000                
Multifamily Residential Property [Member]                  
Other Investment [Line Items]                  
Proceeds from Sale and Maturity of Other Investments           $ 563,000      
Gain (Loss) on Sale of Other Investments           429,000      
Stock Fund [Member]                  
Other Investment [Line Items]                  
Proceeds from Sale and Maturity of Other Investments           316,000      
Gain (Loss) on Sale of Other Investments           66,000      
Existing investments [Member]                  
Other Investment [Line Items]                  
Payments to Acquire Other Investments           220,000      
Real Estate Partnership [Member]                  
Other Investment [Line Items]                  
Payments to Acquire Other Investments   $ 300,000       $ 700,000      
v3.19.3
INVESTMENTS IN MARKETABLE SECURITIES (Details) - USD ($)
3 Months Ended 9 Months Ended
Sep. 30, 2019
Sep. 30, 2018
Sep. 30, 2019
Sep. 30, 2018
Marketable Securities, Gain (Loss) [Abstract]        
Net realized gain from sales of securities $ 17,000 $ 39,000 $ 6,000 $ 35,000
Unrealized net (loss) gain in trading securities (5,000) (37,000) 247,000 (9,000)
Total net gain from investments in marketable securities $ 12,190 $ 1,829 $ 252,747 $ 26,291