Property Loans, Net of Loan Loss Allowances

9 Months Ended

Sep. 30, 2021

Property Loans Net Of Loan Loss Allowance [Abstract]

Property Loans, Net of Loan Loss Allowances

10. Property Loans, Net of Loan Loss Allowances

The following tables summarize the Partnership’s property loans, net of loan loss allowances, as of September 30, 2021 and December 31, 2020:

	September 30, 2021
	Outstanding Balance		Loan Loss Allowance			Property Loan Principal, net of allowance
Avistar (February 2013 portfolio)	$	201,972	$	-		$	201,972
Avistar (June 2013 portfolio)		251,622		-			251,622
Centennial Crossings ^{(1) (2)}		3,017,729		-			3,017,729
Cross Creek		11,101,887		(7,393,814	)		3,708,073
Greens Property		850,000		-			850,000
Hilltop at Signal Hills ^{(1) (2)}		1,000,000		-			1,000,000
Legacy Commons at Signal Hills ^{(1) (2)}		1,000,000		-			1,000,000
Live 929 Apartments		1,241,348		(1,241,348	)		-
Oasis at Twin Lakes ^{(1) (2)}		13,948,971		-			13,948,971
Ohio Properties		2,390,446		-			2,390,446
Osprey Village ⁽¹⁾⁽²⁾		1,000,000		-			1,000,000
Scharbauer Flats Apartments ^{(1) (2)}		3,309,613		-			3,309,613
Willow Place Apartments ⁽²⁾		1,000,000		-			1,000,000
Total	$	40,313,588	$	(8,635,162	)	$	31,678,426

⁽¹⁾	The property loan is held in trust in connection with a TOB financing (Note 16).

⁽²⁾	The property loan and associated GIL are on parity and share a first mortgage lien position on all real and personal property associated with the underlying property. Affiliates of the borrower have guaranteed limited-to-full payment of principal and accrued interest on the property loan.

	December 31, 2020
	Outstanding Balance		Loan Loss Allowance			Property Loan Principal, net of allowance
Arbors at Hickory Ridge	$	191,264	$	-		$	191,264
Avistar (February 2013 portfolio)		201,972		-			201,972
Avistar (June 2013 portfolio)		251,622		-			251,622
Centennial Crossings ^{(1) (2)}		3,017,729		-			3,017,729
Cross Creek		11,101,887		(7,393,814	)		3,708,073
Greens Property		850,000		-			850,000
Live 929 Apartments		911,232		(911,232	)		-
Ohio Properties		2,390,446		-			2,390,446
Scharbauer Flats Apartments ^{(1) (2)}		2,309,613		-			2,309,613
Total	$	21,225,765	$	(8,305,046	)	$	12,920,719

⁽¹⁾	The property loan is held in trust in connection with a TOB financing (Note 16).

⁽²⁾	The property loan and associated GIL are on parity and share a first mortgage lien position on all real and personal property associated with the underlying property. Affiliates of the borrower have guaranteed limited-to-full payment of principal and accrued interest on the property loan.

The Partnership recognized a provision for loan loss and associated loan loss allowance of zero and approximately $330,000 for the three and nine months ended September 30, 2021, respectively, related to the Live 929 Apartments property loan as the Partnership determined it was probable the outstanding balance will not be collectible.

The Partnership recognized a provision for loan loss and associated loan loss allowance of approximately $812,000 for the three and nine months ended September 30, 2020 related to Live 929 Apartments property loan as the Partnership determined it was probable the outstanding balance will not be collectible.

The interest to be earned on the Live 929 Apartments and Cross Creek property loans was in nonaccrual status for the three and nine months ended September 30, 2021. The discounted cash flow method used by management to establish the net realizable value of these property loans determined the collection of the interest accrued was not probable. In addition, for the three and nine months ended September 30, 2021 and 2020, interest to be earned on approximately $983,000 of property loan principal for the Ohio Properties was in nonaccrual status as, in management’s opinion, the interest was not considered collectible.

Activity in the First Nine Months of 2021

Concurrent with the acquisition of GILs (Note 7), the Partnership committed to provide property loans for the construction of the underlying properties on a draw-down basis for Legacy Commons at Signal Hills, Hilltop at Signal Hills, Osprey Village, and Willow Place Apartments. Property loan commitments for these properties total $100.3 million.

In March 2021, the Partnership amended the secured property loan with Live 929 Apartments to increase the total available loan amount to $1.5 million from $1.0 million. The property loan is subordinate to the MRBs associated with the property.

In August 2021, the Partnership received approximately $328,000 as payment in full for outstanding principal and interest on a note receivable due from Arbors at Hickory Ridge.

Activity in the First Nine Months of 2020

Concurrent with the acquisition of GILs (Note 7), the Partnership committed to provide property loans for the construction of the underlying properties on a draw-down basis for Scharbauer Flats Apartments, Oasis at Twin Lakes, and Centennial Crossings. Property loan commitments for these properties total $76.1 million.

During the third quarter of 2020, the Partnership advanced Live 929 Apartments approximately $406,000 under the secured property loan entered into in August 2019.

The following table summarizes the Partnership’s remaining property loan commitments as of September 30, 2021:

	Maturity Date ⁽¹⁾	Interest Rate		Maximum Remaining Commitment
Centennial Crossings	9/1/2023	LIBOR + 2.50%	⁽²⁾		21,232,271
Hilltop at Signal Hills	8/1/2023	SOFR + 3.07%	⁽²⁾		20,197,939
Legacy Commons at Signal Hills	2/1/2024	SOFR + 3.07%	⁽²⁾		31,233,972
Oasis at Twin Lakes	8/1/2023	LIBOR + 2.50%	⁽²⁾		13,755,209
Scharbauer Flats Apartments	1/1/2023	LIBOR + 2.85%			20,850,387
Osprey Village	8/1/2024	SOFR + 3.07%	⁽²⁾		24,500,000
Willow Place Apartments	10/1/2024	SOFR + 3.30%	⁽³⁾		20,351,328
Total				$	152,121,106

⁽¹⁾	^{The borrower may elect to extend the maturity date for a period ranging between six and twelve months upon meeting certain conditions, including payment of a non-refundable extension fee.}

⁽²⁾	The index is subject to a floor of 0.5%.

⁽³⁾	The index is subject to a floor of 0.25%.