XML 39 R28.htm IDEA: XBRL DOCUMENT v3.8.0.1
Transactions with Related Parties
3 Months Ended
Mar. 31, 2018
Related Party Transactions [Abstract]  
Transactions with Related Parties

20. Transactions with Related Parties

The General Partner of the Partnership, AFCA 2, is entitled to receive an administrative fee from the Partnership equal to 0.45% per annum of the outstanding principal balance of any of its MRBs, property loans collateralized by real property, and other investments for which the owner of the financed property or other third party is not obligated to pay such administrative fee directly to AFCA 2.  The Partnership paid or accrued administrative fees to AFCA 2 of approximately $922,000 and $865,000 for the three months ended March 31, 2018 and 2017, respectively. In addition to the administrative fees paid directly by the Partnership, AFCA 2 receives administrative fees directly from the owners of properties financed by certain of the MRBs held by the Partnership.  These administrative fees also equal 0.45% per annum of the outstanding principal balance of these MRBs and totaled approximately $25,000 and $15,000 for the three months ended March 31, 2018 and 2017, respectively.

AFCA 2 earns placement fees in connection with the acquisition of certain MRBs, equity investments in unconsolidated entities and select property loans.  These placement fees were paid by the owners of the respective properties and, accordingly, have not been reflected in the accompanying condensed consolidated financial statements because these properties are not considered consolidated VIEs or related parties.  AFCA 2 earned placement fees of approximately $1,068,000 and $938,000 for the three months ended March 31, 2018 and 2017, respectively.

An affiliate of AFCA 2, Burlington Capital Properties, LLC (“Properties Management”) provided property management services for the MF Properties (excluding Suites on Paseo) and eight of the properties collateralizing MRBs during the three months ended March 31, 2018. Properties Management earned total fees related to the MF Properties of approximately $50,000 and $113,000 for the three months ended March 31, 2018 and 2017, respectively.  For MF Properties, the property management fees are reflected as real estate operating expenses on the Partnership’s condensed consolidated statements of operations. For the properties collateralizing MRBs, the property management fees are not Partnership expenses, but are paid in each case by the owner of the Residential Properties. These property management fees are paid out of the revenues generated by the respective property prior to the payment of debt service on the Partnership's MRBs and property loans, if applicable.

An affiliate of AFCA 2, Farnam Capital Advisors, LLC (“Farnam Cap”), acts as an origination advisor and consultant to the borrowers when MRBs, Investments in unconsolidated entities, select notes receivable, and financing facilities are acquired by the Partnership. Origination fees paid to this affiliate by the borrower of certain acquired bonds were zero and approximately $269,000 for the three months ended March 31, 2018 and 2017, respectively. These origination fees were paid by the borrower and since they are not Partnership expenses, they have not been reflected in the accompanying condensed consolidated financial statements. The Partnership paid consulting fees to the affiliate of zero and approximately $921,000 for services related to the origination of Term A/B Trusts during the three months ended March 31, 2018 and 2017, respectively.