Real Estate Notes Receivable

9 Months Ended

Sep. 30, 2013

Real Estate Notes Receivable, Net [Abstract]

Real Estate Notes Receivable

Real Estate Notes Receivable

Real estate notes receivable includes four promissory notes totaling $20.0 million as of September 30, 2013 and December 31, 2012. The promissory notes are secured by medical office buildings, with interest rates ranging from 10.85% to 10.95% per annum. The weighted average effective interest rate based on the purchase price of the notes was 14.57% per annum as of September 30, 2013. The promissory notes matured on November 1, 2013 and we expect to receive payment on the principal balance or extend the maturity date during the quarter ending December 31, 2013. The promissory notes have sufficient collateral coverage based on the value of the medical office buildings. The promissory notes will continue to accrue interest as the same per annum rates and as of September 30, 2013 all interest payments were current.

In addition, we originated two promissory notes in September 2013 totaling $8.5 million. The promissory notes are secured by medical office buildings in South Florida, each with an interest rate of 7.0% per annum. The properties are being actively marketed for sale and the notes will be repaid upon any sale. The promissory notes mature on October 1, 2016.

We monitor the credit quality of our real estate notes receivable on an ongoing basis by tracking possible credit quality indicators. As of September 30, 2013, all of our real estate notes receivable are current and we have not provided for any allowance for losses or recorded any impairments with respect to our notes receivable. We made no purchases or sales of real estate notes receivable during the nine months ended September 30, 2013.