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Allowance for Credit Losses
 9 Months Ended
Sep. 30, 2025
Credit Loss [Abstract]  
Allowance for Credit Losses Allowance for Credit Losses
Under ASC 326, we are required to estimate and record a non-cash allowance for current expected credit losses, or CECL allowance, related to our historical and any future investments in sales-type leases, lease financing receivables, loans and securities classified as held-to-maturity.
The following tables detail the allowance for credit losses as of September 30, 2025 and December 31, 2024:
September 30, 2025
($ In thousands)Amortized Cost
Allowance (1)
Net InvestmentAllowance as a % of Amortized Cost
Investments in leases – sales-type$24,565,707 $(802,091)$23,763,616 3.27 %
Investments in leases – financing receivables19,390,805 (750,732)18,640,073 3.87 %
Investments in loans and securities2,472,048 (39,049)2,432,999 1.58 %
Other assets – sales-type sub-leases862,469 (20,372)842,097 2.36 %
Totals$47,291,029 $(1,612,244)$45,678,785 3.41 %
December 31, 2024
($ In thousands)Amortized Cost
Allowance (1)
Net InvestmentAllowance as a % of Amortized Cost
Investments in leases – sales-type$24,383,843 $(802,742)$23,581,101 3.29 %
Investments in leases – financing receivables19,167,432 (737,112)18,430,320 3.85 %
Investments in loans and securities1,676,530 (24,997)1,651,533 1.49 %
Other assets – sales-type sub-leases863,374 (20,598)842,776 2.39 %
Totals$46,091,179 $(1,585,449)$44,505,730 3.44 %
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(1) The total allowance excludes the CECL allowance for unfunded commitments of our loans and for unfunded commitments made to our tenants to fund the development and construction of improvements at our properties. As of September 30, 2025 and December 31, 2024, such allowance is $9.7 million and $9.5 million, respectively, and is recorded in Other liabilities.
The following chart reflects the roll-forward of the allowance for credit losses on our real estate portfolio for the three and nine months ended September 30, 2025 and 2024:
Three Months Ended
September 30,		Nine Months Ended
September 30,
(In thousands)2025202420252024
Beginning Balance$1,643,241 $1,534,515 $1,594,931 $1,472,386 
Initial allowance from current period investments— — 8,126 2,914 
Current period change in credit allowance(21,314)(31,022)18,870 28,193 
Charge-offs— — — — 
Recoveries— — — — 
Ending Balance$1,621,927 $1,503,493 $1,621,927 $1,503,493 
During the three months ended September 30, 2025, we recognized a $20.2 million decrease in our allowance for credit losses primarily driven by a decrease in the volatility of the equity market performance of our tenants partially offset by negative changes in the macroeconomic forecast during the current quarter, both of which impact the reasonable and supportable period, or R&S Period, probability of default, or PD.
During the nine months ended September 30, 2025, we recognized a $24.8 million increase in our allowance for credit losses primarily driven by the equity market performance of our tenants and negative changes in the macroeconomic forecast during the current period. In addition, we recorded an initial CECL allowance of $8.1 million on our $960.0 million of debt investment activity during the period. The increase was partially offset by standard annual updates to the CECL model used and certain related inputs, which decreased the estimate used for the Long-Term Period PD.
During the three months ended September 30, 2024, we recognized a $31.6 million decrease in our allowance for credit losses primarily driven by positive changes in the macroeconomic forecast during the applicable quarter and equity market performance of our tenants. This decrease was partially offset by adjustments made to the assumptions used to project future cash flows for one of our investments.
During the nine months ended September 30, 2024, we recognized a $32.3 million increase in our allowance for credit losses primarily driven by the market performance of our tenants and negative changes in the macroeconomic forecast during the period as well as adjustments made to the assumptions used to project future cash flows for one of our investments.
As of September 30, 2025 and December 31, 2024, and since our formation on October 6, 2017, all of our lease agreements and loan and security investments are current in payment of their obligations to us and no investments are on non-accrual status.
Credit Quality Indicators
We assess the credit quality of our investments through the credit ratings of the senior secured debt of the guarantors of our leases, as we believe that our lease agreements have a similar credit profile to a senior secured debt instrument. The credit quality indicators are reviewed by us on a quarterly basis as of quarter-end. In instances where the guarantor of one of our lease agreements does not have senior secured debt with a credit rating, we use either a comparable proxy company or the overall corporate credit rating, as applicable. We also use this credit rating to determine the Long-Term Period PD when estimating credit losses for each investment.
The following tables detail the amortized cost basis and year of origination of our Investments in leases - sales-type and financing receivables, Investments in loans and securities and Other assets by the credit quality indicator we assigned to each lease or loan guarantor as of September 30, 2025 and December 31, 2024:
Amortized Cost Basis by Year of Origination as of September 30, 2025 (1)
(In thousands)20252024202320222021PriorTotal
Ba2$— $— $— $4,854,002 $— $— $4,854,002 
Ba3— — — 13,041,180 2,191,905 18,420,044 33,653,129 
B1— — — 2,388,638 — 926,711 3,315,349 
B2— — 449,223 — — — 449,223 
B3— — 287,053 300,829 — 891,294 1,479,176 
Caa1— — 395,709 — — 343,409 739,118 
N/A (2)
573,099 348,782 1,080,107 799,044 — — 2,801,032 
Total$573,099 $348,782 $2,212,092 $21,383,693 $2,191,905 $20,581,458 $47,291,029 
Amortized Cost Basis by Year of Origination as of December 31, 2024 (1)
(In thousands)20242023202220212020PriorTotal
Ba2$— $— $4,795,479 $— $— $— $4,795,479 
Ba3— — 12,882,102 2,182,313 5,667,136 12,634,167 33,365,718 
B1— — 2,359,188 — — 924,344 3,283,532 
B2— 447,554 — — 887,545 — 1,335,099 
B3— 667,922 299,859 — — 341,426 1,309,207 
N/A (2)
313,761 987,422 700,961 — — — 2,002,144 
Total$313,761 $2,102,898 $21,037,589 $2,182,313 $6,554,681 $13,899,937 $46,091,179 
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(1)Excludes the CECL allowance for unfunded commitments recorded in Other liabilities as such commitments are not currently reflected on our Balance Sheet, rather the CECL allowance is based on our current best estimate of future funding commitments.
(2)We estimate the CECL allowance for our loan investments, and certain of our lease investments with similar credit characteristics, using a traditional commercial real estate model based on standardized credit metrics to estimate potential losses.