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Net Investment in Leases | 3 Months Ended
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Mar. 31, 2022
Leases [Abstract] |
Net Investment in Leases | Note 5—Net Investment in Leases In June 2021, the Company acquired two parcels of land for $42.0 million each and simultaneously entered into two Ground Leases with the respective tenants. Each Ground Lease also provides for a leasehold improvement allowance up to a maximum of $83.0 million. The Company also concurrently entered into an agreement pursuant to which SAFE would acquire the Ground Leases from the Company. If certain construction conditions are not met within a specified time period, SAFE will have no obligation to acquire the Ground Leases or fund the leasehold improvement allowances. The Company classified one of the Ground Leases as a sales-type lease and it is recorded in “Net investment in leases” on the Company’s consolidated balance sheets. For the three months ended March 31, 2022, the Company recognized $0.2 million of non-cash interest income in "Interest income from sales-type leases" in the Company’s consolidated statements of operations. In January 2022, the Company sold the Ground Lease to an investment fund in which the Company owns a 53% noncontrolling interest (refer to Note 8 – Ground Lease Plus Fund). One Ground Lease was entered into with the seller of the land and did not qualify for sale leaseback accounting, and as such, was accounted for as a financing transaction and $42.0 million was recorded in “Loans receivable held for sale” on the Company’s consolidated balance sheet at the time of acquisition. There can be no assurance that the conditions to closing will be satisfied and that SAFE will acquire the properties and Ground Leases from the Company. In January 2022, the Company sold the Ground Lease to the Ground Lease Plus Fund (refer to Note 8). In January 2022, the Company entered into a commitment to acquire land for $36.0 million and simultaneously structured and entered into a Ground Lease as part of the Ground Lease tenant’s recapitalization of an existing multifamily property. As of March 31, 2022, the Company had funded $28.2 million of this commitment. SAFE (refer to Note 8) waived its right of first refusal on this investment but entered into an agreement with the Company pursuant to which SAFE would acquire the land and related Ground Lease when certain construction related conditions are met. The Company’s net investment in leases were comprised of the following as of March 31, 2022 and December 31, 2021 ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | March 31, 2022 |  | December 31, 2021
Total undiscounted cash flows | ​ | $ | 356,338 | ​ | $ | 524,712
Unguaranteed estimated residual value | ​ |  | 21,750 | ​ |  | 42,000
Present value discount | ​ |  | (349,676) | ​ |  | (523,497)
Allowance for losses on net investment in leases | ​ |  | (281) | ​ |  | —
Net investment in leases(1) | ​ | $ | 28,131 | ​ | $ | 43,215
(1) | As of March 31, 2022 and December 31, 2021, the Company’s net investment in lease was current in its payment status and performing in accordance with the terms of the lease. As of March 31, 2022, the risk rating on the Company’s net investment in leases was 1.0.
Dispositions— During the three months ended March 31, 2021, the Company sold net lease assets for net proceeds of $6.6 million and recognized an aggregate impairment of $1.5 million in connection with the sales which is recorded in “Net income from discontinued operations” in the Company’s consolidated statements of operations. Future Minimum Lease Payments under Sales-type Leases—Future minimum lease payments to be collected under sales-type leases, excluding lease payments that are not fixed and determinable, in effect as of March 31, 2022, are as follows by year ($ in thousands):
​ | ​ | ​ | ​
​ |  | Amount
2022 (remaining nine months) | ​ | $ | 688
2023 | ​ |  | 934
2024 | ​ |  | 1,194
2025 | ​ |  | 1,240
2026 | ​ |  | 1,264
Thereafter | ​ |  | 351,018
Total undiscounted cash flows | ​ | $ | 356,338
​ Allowance for Losses on Net Investment in Leases—Changes in the Company’s allowance for losses on net investment in leases for the three months ended March 31, 2022 and 2021 were as follows ($ in thousands): ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Three Months Ended |
​ | ​ | March 31, 2022 |  | March 31, 2021 | ​
Allowance for losses on net investment in leases at beginning of period(1) |  | $ | — | ​ | $ | 10,871 |
Provision for (recovery of) losses on net investment in leases (2) | ​ | ​ | 281 | ​ | ​ | (1,601) | ​
Allowance for losses on net investment in leases at end of period(1) | ​ | $ | 281 | ​ | $ | 9,270 | ​
(1) | All 2021 amounts were for net investment in leases included in the Net Lease Sale (refer to Note 3 – Net Lease Sale and Discontinued Operations).
(2) | During the three months ended March 31, 2022, the Company recorded a provision for losses on net investment in leases of $0.3 million due primarily to the macroeconomic forecast on commercial real estate markets. During the three months ended March 31, 2021, the Company recorded a recovery of losses on net investment in leases of $1.6 million (which is included in “Net income from discontinued operations’) due primarily to an improving macroeconomic forecast on commercial real estate markets since December 31, 2020.

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- Definition The entire disclosure of lessor's sales-type leases. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 842 -SubTopic 30 -URI http://asc.fasb.org/subtopic&trid=77888252 + Details
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