XML 24 R13.htm IDEA: XBRL DOCUMENT

REAL ESTATE LOANS RECEIVABLE

6 Months Ended

Jun. 30, 2025

REAL ESTATE LOANS RECEIVABLE [Abstract]

REAL ESTATE LOANS RECEIVABLE

NOTE 5 – REAL ESTATE LOANS RECEIVABLE

Real estate loans consist of mortgage notes and other real estate loans which are primarily collateralized by a first, second or third mortgage lien or a leasehold mortgage on, or an assignment of the partnership interest in the related properties. As of June 30, 2025, our real estate loans receivable consists of 23 fixed rate mortgage notes on 97 long-term care facilities and 20 other real estate loans. The facilities subject to the mortgage notes are operated by 18 independent healthcare operating companies and are located in 12 U.S. states and within the U.K. We monitor compliance with our real estate loans and, when necessary, have initiated collection, foreclosure and other proceedings with respect to certain outstanding real estate loans.

A summary of our real estate loans receivable by loan type is as follows:


		As of June 30, 2025
		Weighted			Weighted
		Average			Average Years			June 30,			December 31,
		Interest Rate			to Maturity			2025			2024

								(in thousands)
Mortgage notes receivable – gross		11.0	%		4.1	⁽¹⁾		$	968,365		$	982,327
Allowance for credit losses on mortgage notes receivable									(35,833)			(39,562)
Mortgage notes receivable – net									932,532			942,765
Other real estate loans – gross		9.1	%		6.9	⁽²⁾			520,732			517,220
Allowance for credit losses on other real estate loans									(36,444)			(31,687)
Other real estate loans – net									484,288			485,533
Total real estate loans receivable – net								$	1,416,820		$	1,428,298

(1)

Consists of mortgage notes with maturity dates ranging from 2025 through 2037 (with $194.1 million maturing in 2025). Two of the mortgage notes with an aggregate principal balance of $12.5 million are past due and have been written down, through our allowance for credit losses, to the estimated fair value of the underlying collateral of $1.5 million.

(2)	Consists of other real estate loans with maturity dates ranging from 2025 through 2035 (with $25.6 million maturing in 2025).

Interest income on real estate loans is included within interest income on the Consolidated Statements of Operations and is summarized as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2025			2024			2025			2024

	(in thousands)						(in thousands)
Mortgage notes – interest income	$	25,520		$	21,651		$	51,525		$	41,494
Other real estate loans – interest income		7,455			9,307			14,612			18,203
Total real estate loans interest income	$	32,975		$	30,958		$	66,137		$	59,697

The following is a summary of advances and principal repayments under our real estate loans:


	Three Months Ended						Six Months Ended
	June 30,						June 30,
	2025			2024			2025			2024

	(in thousands)						(in thousands)
Advances on new real estate loans receivable⁽¹⁾	$	25,604		$	112,895		$	45,651		$	154,136
Advances on existing real estate loans receivable		3,186			601			9,677			3,362
Principal repayments on real estate loans receivable⁽²⁾		(21,326)			(3,014)			(64,830)			(7,005)
Net cash advances (repayments) on real estate loans receivable	$	7,464		$	110,482		$	(9,502)		$	150,493

(1)

For the three and six months ended June 30, 2025, consists of advances under 12 and 14 new real estate loans originated during 2025 with weighted average interest rates of 10.0% and 10.3%, respectively. For the three and six months ended June 30, 2024, consists of advances under four and 11 new real estate loans with weighted average interest rates of 11.5% and 10.2%, respectively.

(2)

The six months ended June 30, 2025 includes $40.6 million of early repayments on mortgage notes with a weighted average interest rate of 11.6%, as of the repayment date, subject to the master mortgage agreement with Ciena Healthcare Management, Inc (“Ciena”). Excludes principal recoveries on loans written off in prior periods and cash recoveries related to interest payments received on loans that are written down to fair value and are being accounted for under the cost recovery method in which any payments received are applied directly against the principal balance outstanding.

Included below is additional discussion on any significant new loans issued and significant updates to any existing loans.

Maplewood Revolving Credit Facility

We have a $320 million revolving credit facility with Maplewood (the “Maplewood Revolver”) that bears interest at 7% per annum (consisting of 4% per annum of cash interest and 3% per annum PIK for 2025) and matures in June 2035. The amortized cost basis of the Maplewood Revolver was $263.6 million as of June 30, 2025 and December 31, 2024. Due to liquidity issues of the borrower, the Maplewood Revolver is on non-accrual status. Maplewood failed to make aggregate cash interest payments that were required under the loan agreement of $3.1 million and $5.4 million during the three and six months ended June 30, 2025, respectively, and of $0.7 million and $1.2 million during the three and six months ended June 30, 2024, respectively. As such, we did not record any interest income for the Maplewood Revolver during the three and six months ended June 30, 2025 and 2024.

As discussed within Note 4 – Contractual Receivables and Other Receivables and Lease Inducements, Omega entered into a settlement agreement with the Estate during the third quarter of 2024 that, among other things, grants Omega the right to direct the assignment of Mr. Smith’s equity to the key members of the existing Maplewood management team or their designee(s), with the Estate remaining liable under Mr. Smith’s guaranty until the transition is complete or one year from the court’s approval date, if earlier, and requires Omega to refrain from exercising contractual rights or remedies in connection with the defaults. We are still awaiting regulatory approvals related to licensure of the operating assets before the transition will be completed. There is no certainty that the regulatory approvals will be received or that this transition will be completed as intended, on a timely basis, or at all. If the proposed transition plan is not completed, we may incur a substantial loss on the Maplewood Revolver up to the amortized cost basis of the loan. As of June 30, 2025, the internal risk rating on the loan is a 5, which we believe appropriately reflects the risks associated with the loan as of June 30, 2025. See the allowance for credit losses attributable to real estate loans with a 5 internal risk rating within Note 7 – Allowance for Credit Losses.