Fair Value of Financial Instruments

9 Months Ended

Sep. 30, 2014

The following table presents the carrying value and estimated fair value of the Company’s financial instruments not carried at fair value on the consolidated balance sheet at September 30, 2014 and December 31, 2013:



	September 30, 2014						December 31, 2013
	Carrying Value			Estimated Fair Value			Carrying Value			Estimated Fair Value
Cash and cash equivalents	$	58,649		$	58,649		$	20,096		$	20,096
Restricted cash	30,127			30,127			30,127			30,127
Securities, held-to-maturity	153,998			154,984			—			—
Commercial first mortgage loans	369,924			372,228			161,099			164,405
Subordinate loans	585,504			589,818			497,484			503,267
Borrowings under repurchase agreements	(537,766		)	(536,612		)	(202,033		)	(202,148		)
Convertible senior notes, net	(246,054		)	(253,476		)	—			—
Participations sold	(89,418		)	(89,996		)	—			—

To determine estimated fair values of the financial instruments listed above, market rates of interest, which include credit assumptions, are used to discount contractual cash flows. The estimated fair values are not necessarily indicative of the amount the Company could realize on disposition of the financial instruments. The use of different market assumptions or estimation methodologies could have a material effect on the estimated fair value amounts. The Company’s commercial first mortgage loans, subordinate loans and repurchase agreements are carried at amortized cost on the condensed consolidated financial statements and are classified as Level III in the fair value hierarchy.