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NOTES AND INTEREST RECEIVABLE
 3 Months Ended
Mar. 31, 2019
Receivables [Abstract]  
NOTES AND INTEREST RECEIVABLE

NOTE 5. NOTES AND INTEREST RECEIVABLE

 

A portion of our assets are invested in mortgage notes receivable, principally secured by real estate. We may originate mortgage loans in conjunction with providing purchase money financing of property sales. Notes receivable are generally collateralized by real estate or interests in real estate and guarantees, unless noted otherwise, are so secured. Management intends to service and hold for investment the mortgage notes in our portfolio. A majority of the notes receivable provide for principal to be paid at maturity.

 

Below is a summary of our notes receivable as of March 31, 2019 (dollars in thousands): 

 

Borrower   Maturity
Date		     Interest
Rate		     Amount     Security  
Performing loans:                            
H198, LLC (Las Vegas Land)   01/20     12.00 %     5,907       Secured  
H198, LLC (Legacy at Pleasant Grove Land)   10/19     12.00 %     496       Secured  
Oulan-Chikh Family Trust   03/21     8.00 %     174       Secured  
H198, LLC (McKinney Ranch Land)   09/20     6.00 %     4,554       Secured  
Forest Pines   09/19     5.00 %     2,230       Secured  
Spyglass Apartments of Ennis, LP   11/19     5.00 %     5,141       Secured  
Bellwether Ridge   05/20     5.00 %     3,540       Secured  
Parc at Windmill Farms   05/20     5.00 %     6,202       Secured  
Unified Housing Foundation, Inc. (Echo Station) (1)   12/32     12.00 %     1,481       Secured  
Unified Housing Foundation, Inc. (Inwood on the Park) (1)   12/32     12.00 %     3,639       Secured  
Unified Housing Foundation, Inc. (Kensington Park) (1)   12/32     12.00 %     3,933       Secured  
Unified Housing Foundation, Inc. (Lakeshore Villas) (1)   12/32     12.00 %     2,000       Secured  
Unified Housing Foundation, Inc. (Lakeshore Villas) (1)   12/32     12.00 %     6,369       Secured  
Unified Housing Foundation, Inc. (Lakeshore Villas) (1)   12/32     12.00 %     2,732       Secured  
Unified Housing Foundation, Inc. (Limestone Ranch) (1)   12/32     12.00 %     1,953       Secured  
Unified Housing Foundation, Inc. (Limestone Ranch) (1)   12/32     12.00 %     2,000       Secured  
Unified Housing Foundation, Inc. (Limestone Ranch) (1)   12/32     12.00 %     4,000       Secured  
Unified Housing Foundation, Inc. (Reserve at White Rock Phase I) (1)   12/32     12.00 %     2,485       Secured  
Unified Housing Foundation, Inc. (Reserve at White Rock Phase II) (1)   12/32     12.00 %     2,555       Secured  
Unified Housing Foundation, Inc. (Timbers of Terrell) (1)   12/32     12.00 %     1,323       Secured  
Unified Housing Foundation, Inc. (Tivoli) (1)   12/32     12.00 %     6,140       Secured  
Unified Housing Foundation, Inc. (Trails at White Rock) (1)   12/32     12.00 %     3,815       Secured  
Unified Housing Foundation, Inc. (1)   12/19     12.00 %     10,401       Unsecured  
Unified Housing Foundation, Inc. (1)   06/20     12.00 %     11,075       Unsecured  
Unified Housing Foundation, Inc. (1)   12/32     12.00 %     1,349       Unsecured  
Realty Advisors Management, Inc. (1)   12/24     2.28 %     20,387       Unsecured  
One Realco Corporation   01/20     3.00 %     7,000       Unsecured  
Other related party notes (1) (2)   Various     Various       2,363       Various secured interests  
Other non-related party notes   Various     Various       1,377       Various secured interests  
Other non-related party notes   Various     Various       2,671       Various unsecured interests  
Accrued interest                 9,439          
Total Performing               $ 138,731          
Allowance for estimated losses                 (14,269 )        
Total               $ 124,462          

 

(1) Related party notes.

(2) An allowance was taken for estimated losses at full value of note.

 

We invest in mortgage loans, secured by mortgages that are subordinate to one or more prior liens either on the fee or a leasehold interest in real estate. Recourse on such loans ordinarily includes the real estate on which the loan is made, other collateral and guarantees.

 

At March 31, 2019, we had mortgage loans and accrued interest receivable from related parties, net of allowances, totaling $114.3 million. We recognized interest income of $2.5 million related to these notes receivables.

 

The Company has various notes receivable from Unified Housing Foundation, Inc. (“UHF”) and Foundation for Better Housing, Inc. (“FBH”). UHF and FBH are determined to be related parties due to our reliance upon the performance of the collateral secured under the notes receivable. Payments are due from surplus cash flow of operations of the properties. A sale or refinance of any of the properties underlying these notes will be used to repay outstanding interest and principal for the remaining notes for the specific borrower. These notes are cross-collateralized for the specific borrower, but to the extent cash is received from a specific UHF or FBH property, it is applied first against any outstanding interest for the related-property note. The allowance on the UHF notes was a purchase allowance that was netted against the notes when acquired.