XML 22 R12.htm IDEA: XBRL DOCUMENT
v3.22.1

Notes Receivable, Net | 3 Months Ended
--- | ---
Mar. 31, 2022
Accounts and Financing Receivable, after Allowance for Credit Loss [Abstract] |
Notes Receivable, Net | 3. Notes Re ceivable, Net The Company’s notes receivable, net are generally collateralized either by the underlying properties or the borrowers’ ownership interests in the entities that own the properties, and were as follows (dollars in thousands):
|  | March 31, |  |  | December 31, |  |  | March 31, 2022 |
Description |  | 2022 |  |  | 2021 |  |  | Number |  |  | Maturity Date |  |  | Interest Rate |
Core Portfolio (a) |  | $ | 154,331 |  |  | $ | 154,332 |  |  |  | 7 |  |  | Apr 2020 - Dec 2027 |  |  | 4.65% - 12.00% |
Fund III |  |  | — |  |  |  | 5,306 |  |  |  | — |  |  |  | — |  |  |  | — |
Total notes receivable |  |  | 154,331 |  |  |  | 159,638 |  |  |  |  |  |  |  |  |  |
Allowance for credit loss |  |  | (1,170 | ) |  |  | (5,752 | ) |  |  |  |  |  |  |  |  |
Notes receivable, net |  | $ | 153,161 |  |  | $ | 153,886 |  |  |  | 7 |  |  |  |  |  |  |
a) Includes one note receivable from an OP Unit holder, with a balance of $6.0 million at March 31, 2022 and December 31, 2021. During the three months ended March 31, 2022, the Company: • in January 2022, Fund III obtained the remaining venture partner's interest in exchange for its note with a balance of $5.3 million, accrued interest of $4.7 million less credit loss reserve of $4.6 million, via a foreclosure auction. The entity was previously accounted for as an equity method investment until Fund III acquired the venture partner's interest in a foreclosure auction. Fund III now owns 100% of the entity and consolidates it (Note 4). During the year ended December 31, 2021, the Company: • originated a new Core Portfolio note for $16.0 million with a stated interest rate of 9% and a maturity date of October 20, 2022 collateralized by a single tenant property in Silver Spring, Maryland on April 20, 2021; • exchanged 21,109 OP Units in settlement of a note receivable in the amount of $0.5 million on July 12, 2021 (Note 10); • originated a new Core Portfolio note for $43.0 million, of which $42.0 million was funded, with three tranches with stated interest rates ranging from 5% to 12% and a maturity date of September 17, 2024 collateralized by a retail condominium in Soho, New York on September 17, 2021; • extended the maturity date of one Core note receivable of $13.5 million from October 28, 2021 to June 1, 2022; and • recorded an increase in its allowance for credit loss of approximately $4.5 million primarily attributable to the Fund III note that matured in July 2020. Default One Core Portfolio note aggregating $21.6 million including accrued interest (exclusive of default interest and other amounts due on the loan that have not been recognized) was in default at March 31, 2022 and December 31, 2021. On April 1, 2020, the loan matured and was not repaid. The Company expects to take appropriate actions to recover the amounts due under the loan, and has issued a reservation of rights letter to the borrowers and guarantor, reserving all of its rights and remedies under the applicable loan documents and otherwise. The Company has determined that the collateral for this loan is sufficient to cover the loan’s carrying value at March 31, 2022 and December 31, 2021. Allowance for Credit Losses The Company monitors the credit quality of its notes receivable on an ongoing basis and considers indicators of credit quality such as loan payment activity, the estimated fair value of the underlying collateral, the seniority of the Company’s loan in relation to other debt secured by the collateral and the prospects of the borrower. Earnings from these notes and mortgages receivable are reported within the Company’s Structured Financing segment (Note 12). The Company’s estimated allowance for credit losses related to its Structured Financing segment has been computed for its amortized cost basis in the portfolio, including accrued interest (Note 5), factoring historical loss experience in the United States for similar loans, as adjusted for current conditions, as well as the Company’s expectations related to future economic conditions. Due to the lack of comparability across the Structured Financing portfolio, each loan was evaluated separately. As a result, there were five non-collateral-dependent loans with a total amortized cost of $144.8 million, inclusive of accrued interest of $14.3 million, for which an allowance for credit losses has been recorded aggregating $1.2 million at March 31, 2022. For two loans in this portfolio, aggregating $27.9 million, inclusive of accrued interest of $4.1 million at March 31, 2022, the Company has elected to apply a practical expedient in accordance with ASC 326 and did no t establish an allowance for credit losses because (i) these loans are collateral-dependent loans, which due to their settlement terms are not expected to be settled in cash but rather by the Company’s possession of the real estate collateral; and (ii) at March 31, 2022, the Company determined that the estimated fair value of the collateral at the expected realization date for these loans was sufficient to cover the carrying value of its investments in these notes receivable. Impairment charges may be required if and when such amounts are estimated to be nonrecoverable upon a realization event, which is generally at the time a loan is repaid, or in the case of foreclosure, when the underlying asset is sold; however, non-recoverability may also be concluded if it is reasonably certain that all amounts due will not be collected.

X
- References No definition available. + Details
Name: | us-gaap_AccountsAndNotesReceivableNetAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Publisher FASB -Name Accounting Standards Codification -Topic 310 -SubTopic 10 -URI http://asc.fasb.org/subtopic&trid=2196772 + Details
Name: | us-gaap_LoansNotesTradeAndOtherReceivablesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration