Loans Receivable and Other Lending Investments, net (Tables)

6 Months Ended

Jun. 30, 2014

Schedule of the Company's loans and other lending investments by class

The following is a summary of the Company's loans receivable and other lending investments by class ($ in thousands):



	As of
Type of Investment	June 30, 2014			December 31, 2013
Senior mortgages	$	851,307		$	1,071,662
Subordinate mortgages	71,696			60,679
Corporate/Partnership loans	489,988			473,045
Total gross carrying value of loans	1,412,991			1,605,386
Reserves for loan losses	(137,904		)	(377,204		)
Total loans receivable, net	1,275,087			1,228,182
Other lending investments—securities	181,320			141,927
Total loans receivable and other lending investments, net(1)	$	1,456,407		$	1,370,109

Explanatory Note:

_______________________________________________________________________________


(1)	The Company's recorded investment in loans as of June 30, 2014 and December 31, 2013 also includes accrued interest of $7.7 million and $6.5 million, respectively, which are included in "Accrued interest and operating lease income receivable, net" on the Company's Consolidated Balance Sheets.

Schedule of changes in the Company's reserve for loan losses

Reserve for Loan Losses—Changes in the Company's reserve for loan losses were as follows ($ in thousands):



	For the Three Months Ended June 30,						For the Six Months Ended June 30,
	2014			2013			2014			2013
Reserve for loan losses at beginning of period	$	370,076		$	521,795		$	377,204		$	524,499
Provision for (recovery of) loan losses(1)	(2,792		)	5,020			(6,192		)	15,226
Charge-offs	(229,380		)	(46,989		)	(233,108		)	(59,899		)
Reserve for loan losses at end of period	$	137,904		$	479,826		$	137,904		$	479,826

Explanatory Note:

_______________________________________________________________________________


(1)	For the three and six months ended June 30, 2014, the provision for loan losses includes recoveries of previously recorded loan loss reserves of $2.4 million and $7.6 million, respectively. For the three and six months ended June 30, 2013, the provision for loan losses includes recoveries of previously recorded loan loss reserves of $6.4 million and $11.0 million, respectively.

Schedule of recorded investment in loans and associated reserve for loan losses

The Company's recorded investment in loans (comprised of a loan's carrying value plus accrued interest) and the associated reserve for loan losses were as follows ($ in thousands):



	Individually Evaluated for Impairment(1)			Collectively Evaluated for Impairment(2)			Loans Acquired with Deteriorated Credit Quality(3)		Total
As of June 30, 2014
Loans	$	323,145		$	1,097,581		$	—	$	1,420,726
Less: Reserve for loan losses	(107,304		)	(30,600		)	—		(137,904		)
Total	$	215,841		$	1,066,981		$	—	$	1,282,822
As of December 31, 2013
Loans	$	752,425		$	849,613		$	9,889	$	1,611,927
Less: Reserve for loan losses	(348,004		)	(29,200		)	—		(377,204		)
Total	$	404,421		$	820,413		$	9,889	$	1,234,723

Explanatory Notes:

_______________________________________________________________________________

(1)

The carrying value of these loans include unamortized discounts, premiums, deferred fees and costs aggregating to a net discount of $2.0 million and a net premium of $0.5 million as of June 30, 2014 and December 31, 2013, respectively. The Company's loans individually evaluated for impairment primarily represent loans on non-accrual status and therefore, the unamortized amounts associated with these loans are not currently being amortized into income.


(2)	The carrying value of these loans include unamortized discounts, premiums, deferred fees and costs aggregating to a net discount of $8.3 million and $4.6 million as of June 30, 2014 and December 31, 2013, respectively.


(3)	The carrying value of the loan includes unamortized discounts, premiums, deferred fees and costs aggregating to a net premium of $0.4 million as of December 31, 2013. The loan had a cumulative principal balance of $10.2 million as of December 31, 2013. The loan was repaid during the six months ended June 30, 2014.

Schedule of investment in performing loans, presented by class and by credit quality, as indicated by risk rating

The Company's recorded investment in performing loans, presented by class and by credit quality, as indicated by risk rating, was as follows ($ in thousands):



	As of
	June 30, 2014			December 31, 2013
	Performing Loans		Weighted Average Risk Ratings	Performing Loans		Weighted Average Risk Ratings
Senior mortgages	$	674,018	2.07	$	591,145	2.50
Subordinate mortgages	72,444		2.68	61,364		3.37
Corporate/Partnership loans	493,578		3.80	438,831		3.88
Total	$	1,240,040	2.80	$	1,091,340	3.11

Schedule of recorded investment in loans, aged by payment status and presented by class

As of June 30, 2014, the Company's recorded investment in loans, aged by payment status and presented by class, were as follows ($ in thousands):



	Current		Less Than and Equal to 90 Days		Greater Than 90 Days		Total Past Due		Total
Senior mortgages	$	640,441	$	67,335	$	146,928	$	214,263	$	854,704
Subordinate mortgages	72,444		—		—		—		72,444
Corporate/Partnership loans	493,578		—		—		—		493,578
Total	$	1,206,463	$	67,335	$	146,928	$	214,263	$	1,420,726

Schedule of recorded investment in impaired loans, presented by class

Impaired Loans—The Company's recorded investment in impaired loans, presented by class, were as follows ($ in thousands)(1):



	As of June 30, 2014							As of December 31, 2013
	Recorded Investment		Unpaid Principal Balance		Related Allowance			Recorded Investment		Unpaid Principal Balance		Related Allowance
With no related allowance recorded:
Senior mortgages	$	81,270	$	80,669	$	—		$	3,012	$	2,992	$	—
With an allowance recorded:
Senior mortgages	203,645		202,112		(104,248		)	650,337		645,463		(304,544		)
Corporate/Partnership loans	38,230		38,242		(3,056		)	99,076		99,067		(43,460		)
Subtotal	241,875		240,354		(107,304		)	749,413		744,530		(348,004		)
Total:
Senior mortgages	284,915		282,781		(104,248		)	653,349		648,455		(304,544		)
Corporate/Partnership loans	38,230		38,242		(3,056		)	99,076		99,067		(43,460		)
Total	$	323,145	$	321,023	$	(107,304	)	$	752,425	$	747,522	$	(348,004	)

Explanatory Note:

_______________________________________________________________________________

(1)

All of the Company's non-accrual loans are considered impaired and included in the table above. In addition, as of June 30, 2014 and December 31, 2013, certain loans modified through troubled debt restructurings with a recorded investment of $142.5 million and $231.8 million, respectively, are also included as impaired loans in accordance with GAAP although they are performing and on accrual status.

Schedule of average recorded investment in impaired loans and interest income recognized, presented by class

The Company's average recorded investment in impaired loans and interest income recognized, presented by class, were as follows ($ in thousands):



	For the Three Months Ended June 30,								For the Six Months Ended June 30,
	2014				2013				2014				2013
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Senior mortgages	$	87,642	$	186	$	16,561	$	8,212	$	59,432	$	687	$	47,067	$	9,057
Corporate/Partnership loans	—		—		10,051		320		—		—		10,070		440
Subtotal	87,642		186		26,612		8,532		59,432		687		57,137		9,497
With an allowance recorded:
Senior mortgages	354,695		70		878,381		450		453,242		123		891,912		956
Subordinate mortgages	—		—		53,966		—		—		—		53,971		—
Corporate/Partnership loans	63,142		52		61,945		80		75,120		117		62,329		157
Subtotal	417,837		122		994,292		530		528,362		240		1,008,212		1,113
Total:
Senior mortgages	442,337		256		894,942		8,662		512,674		810		938,979		10,013
Subordinate mortgages	—		—		53,966		—		—		—		53,971		—
Corporate/Partnership loans	63,142		52		71,996		400		75,120		117		72,399		597
Total	$	505,479	$	308	$	1,020,904	$	9,062	$	587,794	$	927	$	1,065,349	$	10,610

Schedule of troubled debt restructurings, presented by class

The recorded investment in these loans was impacted by the modifications as follows, presented by class ($ in thousands):



	For the Three Months Ended June 30, 2013					For the Six Months Ended June 30, 2013
	Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment		Number of Loans	Pre-Modification Outstanding Recorded Investment		Post-Modification Outstanding Recorded Investment
Senior mortgages	2	$	71,758	$	71,758	3	$	144,432	$	136,758

Marketable securities

As of June 30, 2014, other lending investments—securities includes the following ($ in thousands):



	Face Value		Amortized Cost Basis		Net Unrealized Gain (Loss)		Estimated Fair Value		Net Carrying Value
Available-for-Sale Securities
Municipal debt securities	$	1,040	$	1,040	$	92	$	1,132	$	1,132
Held-to-Maturity Securities
Corporate debt securities	175,000		180,188		—		180,188		180,188
Total	$	176,040	$	181,228	$	92	$	181,320	$	181,320