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Loans Receivable and Other Lending Investments, net | 6 Months Ended
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Jun. 30, 2024
Receivables [Abstract] |
Loans Receivable and Other Lending Investments, net | Note 6—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): (1)
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | As of | ​
​ |  | June 30, 2024 |  | December 31, 2023 | ​
Loans | ​ |  |  | ​ |  |  | ​
Senior mortgages | ​ | $ | 3,050 | ​ | $ | 2,550 | ​
Subordinate mortgages | ​ |  | 14,757 | ​ |  | 14,266 | ​
Subtotal - gross carrying value of loans | ​ |  | 17,807 | ​ |  | 16,816 | ​
Other lending investments | ​ |  |  | ​ |  |  | ​
Available-for-sale debt securities | ​ |  | 13,386 | ​ |  | 4,579 | ​
Subtotal - other lending investments | ​ |  | 13,386 | ​ |  | 4,579 | ​
Total gross carrying value of loans receivable and other lending investments | ​ |  | 31,193 | ​ |  | 21,395 | ​
Allowance for loan losses | ​ |  | (512) | ​ |  | (497) | ​
Total loans receivable and other lending investments, net | ​ | $ | 30,681 | ​ | $ | 20,898 | ​
(1) | As of June 30, 2024 and December 31, 2023, accrued interest was $0.4 million and $0.2 million, respectively, and is recorded in “Accrued interest and operating lease income receivable, net” on the Company’s combined and consolidated balance sheets. During the three and six months ended June 30, 2024 and 2023, the Company did not reverse any accrued interest on its loan portfolio.
Allowance for Loan Losses—Changes in the Company’s allowance for loan losses were as follows for the three months ended June 30, 2024 and 2023 ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | General Allowance | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​
​ | ​ | Construction | ​ | ​ | ​ | ​ | Specific | ​ | ​ | ​
Three Months Ended June 30, 2024 | ​ | Loans | ​ | Loans | ​ | Allowance | ​ | Total
Allowance for loan losses at beginning of period | ​ | $ | — | ​ | $ | 514 | ​ | $ | — | ​ | $ | 514
Provision for (recovery of) loan losses(1) | ​ |  | — | ​ |  | (2) | ​ |  | — | ​ |  | (2)
Allowance for loan losses at end of period | ​ | $ | — | ​ | $ | 512 | ​ | $ | — | ​ | $ | 512
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Three Months Ended June 30, 2023 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Allowance for loan losses at beginning of period | ​ | $ | 78 | ​ | $ | 380 | ​ | $ | — | ​ | $ | 458
Provision for (recovery of) loan losses(1) | ​ |  | (78) | ​ |  | 9 | ​ |  | — | ​ |  | (69)
Allowance for loan losses at end of period | ​ | $ | — | ​ | $ | 389 | ​ | $ | — | ​ | $ | 389
(1) | During the three months ended June 30, 2024 and 2023, the Company recorded a recovery of loan losses of $2 thousand and $0.1 million, respectively, in its combined and consolidated statements of operations. The recovery in 2024 was due primarily to an improving macroeconomic forecast since March 31, 2024. The recovery in 2023 was due primarily to the repayment of loans during the three months ended June 30, 2023.
Changes in the Company’s allowance for loan losses were as follows for the six months ended June 30, 2024 and 2023 ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | General Allowance | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​
​ | ​ | Construction | ​ | ​ | ​ | ​ | Specific | ​ | ​ | ​
Six Months Ended June 30, 2024 | ​ | Loans | ​ | Loans | ​ | Allowance | ​ | Total
Allowance for loan losses at beginning of period | ​ | $ | — | ​ | $ | 497 | ​ | $ | — | ​ | $ | 497
Provision for (recovery of) loan losses(1) | ​ |  | — | ​ |  | 15 | ​ |  | — | ​ |  | 15
Allowance for loan losses at end of period | ​ | $ | — | ​ | $ | 512 | ​ | $ | — | ​ | $ | 512
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Six Months Ended June 30, 2023 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Allowance for loan losses at beginning of period | ​ | $ | 92 | ​ | $ | 437 | ​ | $ | 396 | ​ | $ | 925
Provision for (recovery of) loan losses(1) | ​ |  | (92) | ​ |  | (48) | ​ |  | (396) | ​ |  | (536)
Allowance for loan losses at end of period | ​ | $ | — | ​ | $ | 389 | ​ | $ | — | ​ | $ | 389
(1) | During the six months ended June 30, 2024 and 2023, the Company recorded a provision for loan losses of $15 thousand and $1.6 million, respectively, in its combined and consolidated statements of operations. The provision in 2024 was due primarily to a principal addition to a loan originated in September 2023 (refer to Note 5). The provision in 2023 was due primarily to a $2.2 million provision on the sale of a loan held for sale, which was partially offset by a recovery due to the repayment of loans during the six months ended June 30, 2023.
The Company’s investment in loans, all of which were collectively evaluated for impairment, and the associated allowance for loan losses were as follows as of June 30, 2024 and December 31, 2023 ($ in thousands):
​ | ​ | ​ | ​
As of June 30, 2024 |  | ​ |
Loans | ​ | $ | 17,807
Less: Allowance for loan losses | ​ |  | (512)
Total | ​ | $ | 17,295
As of December 31, 2023 | ​ |  |
Loans | ​ | $ | 16,816
Less: Allowance for loan losses | ​ |  | (497)
Total | ​ | $ | 16,319
​ 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) interest payments become 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 amortized cost basis in performing senior mortgage and subordinate mortgages, presented by year of origination and by credit quality, as indicated by risk rating, as of June 30, 2024 were as follows ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Year of Origination |  |  | ​
​ |  | 2024 |  | 2023 |  | 2022 |  | 2021 |  | 2020 |  | Prior to 2020 |  | Total
Senior mortgages | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Risk rating | ​ | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  | ​ | ​ |
1.0 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | —
1.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
3.0 | ​ |  | — | ​ |  | 3,050 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | 3,050
3.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
5.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
Subtotal | ​ | $ | — | ​ | $ | 3,050 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 3,050
Subordinate mortgages | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Risk rating | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
1.0 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | —
1.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
3.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | 14,757 | ​ |  | 14,757
3.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
5.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
Subtotal | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 14,757 | ​ | $ | 14,757
Total | ​ | $ | — | ​ | $ | 3,050 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 14,757 | ​ | $ | 17,807
​ The Company’s amortized cost basis in performing senior mortgages and subordinate mortgages, presented by year of origination and by credit quality, as indicated by risk rating, as of December 31, 2023 were as follows ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | Year of Origination |  |  | ​
​ |  | 2023 |  | 2022 |  | 2021 |  | 2020 |  | 2019 |  | Prior to 2019 |  | Total
Senior mortgages | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Risk rating | ​ | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  | ​ | ​ |
1.0 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | —
1.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
3.0 | ​ |  | 2,550 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | 2,550
3.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
5.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
Subtotal(1) | ​ | $ | 2,550 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 2,550
Subordinate mortgages | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Risk rating | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
1.0 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | —
1.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
2.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
3.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | 14,266 | ​ |  | 14,266
3.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
4.5 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
5.0 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | —
Subtotal | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 14,266 | ​ | $ | 14,266
Total | ​ | $ | 2,550 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 14,266 | ​ | $ | 16,816
​ The Company’s amortized cost basis in loans, aged by payment status and presented by class, was as follows ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ |  | Less Than |  | Greater |  | ​ | ​ |  | ​ | ​
​ | ​ | ​ | ​ | ​ | or Equal | ​ | Than | ​ | Total | ​ | ​ | ​
​ | ​ | Current | ​ | to 90 Days | ​ | 90 Days | ​ | Past Due | ​ | Total
As of June 30, 2024 | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Senior mortgages | ​ | $ | 3,050 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 3,050
Subordinate mortgages | ​ | ​ | 14,757 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | 14,757
Total | ​ | $ | 17,807 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 17,807
As of December 31, 2023 | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Senior mortgages | ​ | $ | 2,550 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 2,550
Subordinate mortgages | ​ |  | 14,266 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | 14,266
Total | ​ | $ | 16,816 | ​ | $ | — | ​ | $ | — | ​ | $ | — | ​ | $ | 16,816
​ Other lending investments—Other lending investments includes the following securities ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ | ​ |  | ​ | ​ |  | Net |  | ​ | ​ |  | Net
​ | ​ | ​ | ​ | ​ | Amortized | ​ | Unrealized | ​ | Estimated | ​ | Carrying
​ | ​ | Face Value | ​ | Cost Basis | ​ | Gain (Loss) | ​ | Fair Value | ​ | Value
As of June 30, 2024 |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |
Available-for-sale securities |  | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Municipal debt securities(1) | ​ | $ | 13,170 | ​ | $ | 13,170 | ​ | $ | 216 | ​ | $ | 13,386 | ​ | $ | 13,386
Total | ​ | $ | 13,170 | ​ | $ | 13,170 | ​ | $ | 216 | ​ | $ | 13,386 | ​ | $ | 13,386
As of December 31, 2023 | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Available-for-Sale Securities | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |
Municipal debt securities(1) | ​ | $ | 4,220 | ​ | $ | 4,220 | ​ | $ | 359 | ​ | $ | 4,579 | ​ | $ | 4,579
Total | ​ | $ | 4,220 | ​ | $ | 4,220 | ​ | $ | 359 | ​ | $ | 4,579 | ​ | $ | 4,579
​ ​ ​
(1) | In September 2023, the Company acquired two securities for $4.2 million. In February 2024, the Company acquired one security for $0.8 million. In May 2024, the Company acquired three securities for $8.2 million.
As of June 30, 2024, the contractual maturities of the Company’s securities were as follows ($ in thousands):
​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | Amortized | ​ | Estimated
​ | ​ | Cost Basis |  | Fair Value
Maturities |  | ​ |  |  | ​ |
Within one year | ​ | $ | — | ​ | $ | —
After one year through 5 years | ​ |  | — | ​ |  | —
After 5 years through 10 years | ​ |  | — | ​ |  | —
After 10 years | ​ |  | 13,170 | ​ |  | 13,386
Total | ​ | $ | 13,170 | ​ | $ | 13,386
​

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//310-10/tableOfContent + Details
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- References No definition available. + Details
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