Loans Receivable and Other Lending Investments, net

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



	As of
Type of Investment	March 31, 2019			December 31, 2018
Senior mortgages	$	690,860		$	760,749
Corporate/Partnership loans	143,426			148,583
Subordinate mortgages	10,338			10,161
Total gross carrying value of loans	844,624			919,493
Reserves for loan losses	(53,298		)	(53,395		)
Total loans receivable, net	791,326			866,098
Other lending investments—securities	103,520			122,126
Total loans receivable and other lending investments, net	$	894,846		$	988,224

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



	For the Three Months Ended March 31,
	2019			2018
Reserve for loan losses at beginning of period	$	53,395		$	78,489
Recovery of loan losses	(97		)	(855		)
Charge-offs	—			(8,168		)
Reserve for loan losses at end of period	$	53,298		$	69,466

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⁾			Total
As of March 31, 2019
Loans	$	66,500		$	783,334		$	849,834
Less: Reserve for loan losses	(40,888		)	(12,410		)	(53,298		)
Total⁽³⁾	$	25,612		$	770,924		$	796,536
As of December 31, 2018
Loans	$	66,725		$	857,662		$	924,387
Less: Reserve for loan losses	(40,395		)	(13,000		)	(53,395		)
Total⁽³⁾	$	26,330		$	844,662		$	870,992

_______________________________________________________________________________

(1)

The carrying value of these loans include unamortized discounts, premiums, deferred fees and costs totaling net discounts of $0.5 million and $0.5 million as of March 31, 2019 and December 31, 2018, respectively. The Company's loans individually evaluated for impairment primarily represent loans on non-accrual status; 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 totaling net discounts of $2.5 million and $3.1 million as of March 31, 2019 and December 31, 2018, respectively.

(3)

The Company's recorded investment in loans as of March 31, 2019 and December 31, 2018, including accrued interest of $5.2 million and $4.9 million, respectively, is included in "Accrued interest and operating lease income receivable, net" on the Company's consolidated balance sheets. As of March 31, 2019 and December 31, 2018, the total amounts exclude $103.5 million and $122.1 million, respectively, of securities that are evaluated for impairment under ASC 320.

Credit Characteristics—As part of the Company's process for monitoring the credit quality of its loans, it performs a quarterly loan portfolio assessment and assigns risk ratings to each of its performing loans. Risk ratings, which range from 1 (lower risk) to 5 (higher risk), are based on judgments, which are inherently uncertain, and there can be no assurance that actual performance will be similar to current expectation. The Company designates loans as non-performing at such time as: (1) the loan becomes 90 days delinquent; (2) the loan has a maturity default; or (3) management determines it is probable that we will be unable to collect all amounts due according to the contractual terms of the loan. All non-performing loans are placed on non-accrual status and income is only recognized in certain cases upon actual cash receipt.

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 March 31, 2019			As of December 31, 2018
	Performing Loans		Weighted Average Risk Ratings	Performing Loans		Weighted Average Risk Ratings
Senior mortgages	$	628,408	2.81	$	697,807	2.76
Corporate/Partnership loans	144,556		2.89	149,663		2.84
Subordinate mortgages	10,370		3.00	10,192		3.00
Total	$	783,334	2.83	$	857,662	2.77

The Company's recorded investment in loans, aged by payment status and presented by class, was as follows ($ in thousands):



	Current		Less Than and Equal to 90 Days		Greater Than 90 Days⁽¹⁾		Total Past Due		Total
As of March 31, 2019
Senior mortgages	$	634,408	$	—	$	60,500	$	60,500	$	694,908
Corporate/Partnership loans	144,556		—		—		—		144,556
Subordinate mortgages	10,370		—		—		—		10,370
Total	$	789,334	$	—	$	60,500	$	60,500	$	849,834
As of December 31, 2018
Senior mortgages	$	703,807	$	—	$	60,725	$	60,725	$	764,532
Corporate/Partnership loans	149,663		—		—		—		149,663
Subordinate mortgages	10,192		—		—		—		10,192
Total	$	863,662	$	—	$	60,725	$	60,725	$	924,387

_______________________________________________________________________________

(1)

As of March 31, 2019, the Company had two loans which were greater than 90 days delinquent and were in various stages of resolution, including legal and foreclosure-related proceedings and environmental matters, and ranged from 4.0 to 10.0 years outstanding. As of December 31, 2018, the Company had two loans which were greater than 90 days delinquent and were in various stages of resolution, including legal and foreclosure-related proceedings and environmental matters, and ranged from 4.0 to 9.0 years outstanding.

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



	As of March 31, 2019							As of December 31, 2018
	Recorded Investment		Unpaid Principal Balance		Related Allowance			Recorded Investment		Unpaid Principal Balance		Related Allowance
With an allowance recorded:
Senior mortgages	$	66,500	$	66,461	$	(40,888	)	$	66,725	$	66,777	$	(40,395	)
Total	$	66,500	$	66,461	$	(40,888	)	$	66,725	$	66,777	$	(40,395	)

____________________________________________________________


(1)	All of the Company's non-accrual loans are considered impaired and included in the table above.

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 March 31,
	2019				2018
	Average Recorded Investment		Interest Income Recognized		Average Recorded Investment		Interest Income Recognized
With no related allowance recorded:
Subordinate mortgages	$	—	$	—	$	—	$	92
Subtotal	—		—		—		92
With an allowance recorded:
Senior mortgages	66,612		—		74,390		—
Corporate/Partnership loans	—		—		156,605		—
Subtotal	66,612		—		230,995		—
Total:
Senior mortgages	66,612		—		74,390		—
Corporate/Partnership loans	—		—		156,605		—
Subordinate mortgages	—		—		—		92
Total	$	66,612	$	—	$	230,995	$	92

Securities—Other lending investments—securities include the following ($ in thousands):



	Face Value		Amortized Cost Basis		Net Unrealized Gain		Estimated Fair Value		Net Carrying Value
As of March 31, 2019
Available-for-Sale Securities
Municipal debt securities	$	21,140	$	21,140	$	1,475	$	22,615	$	22,615
Held-to-Maturity Securities
Debt securities	100,000		80,905		—		80,905		80,905
Total	$	121,140	$	102,045	$	1,475	$	103,520	$	103,520
As of December 31, 2018
Available-for-Sale Securities
Municipal debt securities	$	21,185	$	21,185	$	476	$	21,661	$	21,661
Held-to-Maturity Securities
Debt securities	120,866		100,465		7		100,472		100,465
Total	$	142,051	$	121,650	$	483	$	122,133	$	122,126

As of March 31, 2019, the contractual maturities of the Company's securities were as follows ($ in thousands):



	Held-to-Maturity Securities				Available-for-Sale Securities
	Amortized Cost Basis		Estimated Fair Value		Amortized Cost Basis		Estimated Fair Value
Maturities
Within one year	$	—	$	—	$	—	$	—
After one year through 5 years	80,905		80,905		—		—
After 5 years through 10 years	—		—		—		—
After 10 years	—		—		21,140		22,615
Total	$	80,905	$	80,905	$	21,140	$	22,615