3. LOANS RECEIVABLE

During the three months ended March 31, 2016, we originated $861.3 million of loans, and funded $586.1 million under new and existing loans.

The following table details overall statistics for our loans receivable portfolio as of March 31, 2016 ($ in thousands):


	Floating Rate			Fixed Rate			Total
Number of loans		96			30			126
Principal balance	$	7,397,918		$	1,948,329		$	9,346,247
Net book value	$	7,362,047		$	1,951,716		$	9,313,763
Unfunded loan commitments⁽¹⁾	$	962,425		$	2,715		$	965,140
Weighted-average cash coupon⁽²⁾		L+4.08	%		5.64	%		4.82	%
Weighted-average all-in yield⁽²⁾		L+4.51	%		5.73	%		5.18	%
Weighted-average maximum maturity (years)⁽³⁾		3.2			2.2			3.0

(1)	Unfunded commitments will primarily be funded to finance property improvements or lease-related expenditures by the borrowers. These future commitments will expire over the next four years.

(2)

As of March 31, 2016, our floating rate loans were indexed to various benchmark rates, with 83% of floating rate loans indexed to USD LIBOR. In addition, $146.9 million of our floating rate loans earned interest based on floors that are above the applicable index, with an average floor of 1.80%, as of March 31, 2016. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, purchase discounts, and accrual of both extension and exit fees. Cash coupon and all-in yield for the total portfolio assume applicable floating benchmark rate for weighted-average calculation.

(3)	Maximum maturity assumes all extension options are exercised by the borrower, however our loans may be repaid prior to such date. As of March 31, 2016, 63% of our loans were subject to yield maintenance or other prepayment restrictions and 37% were open to repayment by the borrower without penalty.

The following table details overall statistics for our loans receivable portfolio as of December 31, 2015 ($ in thousands):


	Floating Rate			Fixed Rate			Total
Number of loans		92			33			125
Principal balance	$	7,098,180		$	2,010,181		$	9,108,361
Net book value	$	7,064,279		$	2,012,728		$	9,077,007
Unfunded loan commitments⁽¹⁾	$	696,276		$	4,382		$	700,658
Weighted-average cash coupon⁽²⁾		L+4.09	%		5.63	%		4.84	%
Weighted-average all-in yield⁽²⁾		L+4.49	%		5.78	%		5.18	%
Weighted-average maximum maturity (years)⁽³⁾		3.3			2.6			3.1

(1)	Unfunded commitments will primarily be funded to finance property improvements or lease-related expenditures by the borrowers. These future commitments will expire over the next four years.

(2)

As of December 31, 2015, our floating rate loans were indexed to various benchmark rates, with 84% of floating rate loans indexed to USD LIBOR. In addition, $147.9 million of our floating rate loans earned interest based on floors that are above the applicable index, with an average floor of 1.80%, as of December 31, 2015. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, purchase discounts, and accrual of both extension and exit fees. Cash coupon and all-in yield for the total portfolio assume applicable floating benchmark rate for weighted-average calculation.

(3)

Maximum maturity assumes all extension options are exercised by the borrower, however our loans may be repaid prior to such date. As of December 31, 2015, 64% of our loans were subject to yield maintenance or other prepayment restrictions and 36% were open to repayment by the borrower without penalty.

Activity relating to our loans receivable portfolio was as follows ($ in thousands):


	Principal			Deferred Fees /			Net Book
	Balance			Other Items⁽¹⁾			Value
December 31, 2015	$	9,108,361		$	(31,354	)	$	9,077,007
Loan originations and fundings		586,066			—			586,066
Loan repayments		(375,374	)		—			(375,374	)
Unrealized gain on foreign currency translation		27,194			340			27,534
Deferred fees and other items⁽¹⁾		—			(10,424	)		(10,424	)
Amortization of fees and other items⁽¹⁾		—			8,954			8,954

March 31, 2016	$	9,346,247		$	(32,484	)	$	9,313,763

(1)	Other items primarily consist of purchase discounts or premiums, exit fees, and deferred origination expenses.

The tables below detail the types of loans in our loan portfolio, as well as the property type and geographic distribution of the properties securing these loans ($ in thousands):


	March 31, 2016					December 31, 2015
Asset Type	Net Book Value		Percentage			Net Book Value		Percentage
Senior loans⁽¹⁾	$	9,076,146		97	%	$	8,847,044		97	%
Subordinate loans⁽²⁾		237,617		3			229,963		3

	$	9,313,763		100	%	$	9,077,007		100	%


Property Type	Net Book Value		Percentage			Net Book Value		Percentage
Office	$	4,164,413		45	%	$	4,039,521		45	%
Hotel		1,871,777		20			1,903,544		21
Manufactured housing		1,349,509		14			1,361,572		15
Retail		802,471		9			684,944		8
Multifamily		551,701		6			580,112		6
Condominium		205,800		2			127,434		1
Other		368,092		4			379,880		4

	$	9,313,763		100	%	$	9,077,007		100	%


Geographic Location	Net Book Value		Percentage			Net Book Value		Percentage
United States
Northeast	$	2,190,170		23	%	$	2,260,392		25	%
Southeast		1,802,381		18			1,836,766		20
West		1,354,256		15			1,125,238		12
Southwest		953,204		10			1,035,839		11
Midwest		703,285		8			616,964		7
Northwest		350,545		4			390,307		4

Subtotal		7,353,841		78			7,265,506		79
International
United Kingdom		982,404		11			888,998		10
Canada		604,343		6			561,023		6
Germany		242,200		3			235,294		3
Spain		69,180		1			66,661		1
Netherlands		61,795		1			59,525		1

Subtotal		1,959,922		22			1,811,501		21

Total	$	9,313,763		100	%	$	9,077,007		100	%

(1)	Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2)	Includes mezzanine loans and subordinate interests in mortgages.

Loan Risk Ratings

As further described in Note 2, our Manager evaluates our loan portfolio on a quarterly basis. In conjunction with our quarterly loan portfolio review, our Manager assesses the risk factors of each loan, and assigns a risk rating based on several factors. Factors considered in the assessment include, but are not limited to, risk of loss, current LTV, debt yield, collateral performance, structure, exit plan, and sponsorship. Loans are rated “1” (less risk) through “5” (greater risk), which ratings are defined in Note 2.

The following table allocates the principal balance and net book value of our loans receivable based on our internal risk ratings ($ in thousands):


	March 31, 2016					December 31, 2015
Risk Rating	Number of Loans	Principal Balance		Net Book Value		Number of Loans	Principal Balance		Net Book Value
1	13	$	915,990	$	911,350	12	$	925,443	$	919,991
2	72		5,743,148		5,729,541	77		5,948,922		5,929,447
3	40		2,633,081		2,619,223	35		2,120,713		2,114,531
4	1		54,028		53,649	1		113,283		113,038
5	—		—		—	—		—		—

	126	$	9,346,247	$	9,313,763	125	$	9,108,361	$	9,077,007

We did not have any impaired loans, nonaccrual loans, or loans in maturity default as of March 31, 2016 or December 31, 2015. During the third quarter of 2015, one of the loans in our portfolio experienced a maturity default as a result of not meeting certain loan covenants. During the fourth quarter of 2015 and the first quarter of 2016, the loan was modified to include, among other changes: a redetermination of asset release pricing; an additional borrower contribution of capital; and an extension of the maturity date to August 31, 2016. During the three months ended March 31, 2016, two of the assets collateralizing the $113.3 million loan were sold and the loan was partially repaid by $59.3 million, resulting in a net book value of $53.6 million as of March 31, 2016. As of March 31, 2016 and December 31, 2015, the borrower was current with all terms of the loan and we expect to collect all contractual amounts due thereunder.