Related-Party Transactions	9 Months Ended
Sep. 30, 2013
Related-Party Transactions
Related-Party Transactions	16. Related-Party Transactions *Management Agreement* We entered into a Management Agreement with our Manager upon closing of our IPO, which provides for an initial term of three years with automatic one-year extensions thereafter unless terminated as described below. Under the Management Agreement, our Manager, subject to the oversight of our board of directors, is required to manage our day-to-day activities, for which our Manager receives a base management fee and is eligible for an incentive fee and stock awards. Our Manager is also entitled to charge us for certain expenses incurred on our behalf, as described below. Refer to our consolidated financial statements and notes thereto included in our Form 10-K for further discussion of this agreement. Base Management Fee. For the three and nine months ended September 30, 2013, approximately $13.5 million and $35.9 million, respectively, was incurred for base management fees. For the three and nine months ended September 30, 2012, approximately $8.5 million and $23.3 million, respectively, was incurred for base management fees. Management fee payable as of September 30, 2013 and December 31, 2012 was $13.5 million and $0, respectively. Incentive Fee. For the three and nine months ended September 30, 2013, approximately $4.8 million and $4.8 million, respectively, was incurred in incentive fees. For the three and nine months ended September 30, 2012, $2.1 million and $7.5 million, respectively, were incurred in incentive fees. During the quarter ended September 30, 2012, we paid the Manager $2.3 million of the incentive fee earned, 50% in cash and the remaining 50% in stock through the issuance of 50,203 shares of common stock at a price of $22.61 per share. Incentive fee payable as of September 30, 2013 and December 31, 2012 was $4.8 million and $0.7 million, respectively. Expense Reimbursement. For the three and nine months ended September 30, 2013, approximately $1.8 million and $6.3 million was incurred, respectively, for executive compensation and other reimbursable expenses of which approximately $1.1 million and $1.1 million was payable as of September 30, 2013 and December 31, 2012, respectively. For the three and nine months ended September 30, 2012, approximately $1.7 million and $4.6 million was incurred, respectively, for executive compensation and other reimbursable expenses. *Loan Investments* On October 16, 2012, we co-originated $475.0 million in financing for the acquisition and redevelopment of a 10 story retail building located at 701 Seventh Avenue in the Times Square area of Manhattan through a joint venture with Starwood Distressed Opportunity Fund IX (“Fund IX”), an affiliate of our Manager. The financing consists of a fully funded $237.5 million first mortgage loan and a $237.5 million mezzanine loan, of which $137.5 million was funded at close. The remaining $100.0 million will be funded upon reaching certain milestones during the transformation of the property. On October 22, 2012, the joint venture sold a 25% participation in both the first mortgage and mezzanine loan to Vornado Realty Trust (“Vornado”). Upon settling this sale, the Company, Fund IX, and Vornado interest in the first mortgage and mezzanine loans are 56.25%, 18.75% and 25.0%, respectively, and each party will fund their pro rata share of any future fundings. On March 27, 2013, the joint venture, along with Vornado, sold its interest in the first mortgage to Berkadia Proprietary, LLC. Immediately following the sale of the first mortgage, the Company repurchased a 56.25% participation interest in the same first mortgage loan through a wholly owned subsidiary, resulting in no change in net interest for the Company. The joint venture distributed $43.9 million from the sale, net of fees, to Fund IX. The joint venture remains the holder of the mezzanine loan. On April 17, 2013, we purchased two B-notes for $146.7 million from entities substantially all of whose equity was owned by an affiliate of our Manager. The B-Notes are secured by two Class-A office buildings located in Austin, Texas. On May 17, 2013, we sold senior participation interests in the B-notes to a third party, generating $95.0 million in aggregate proceeds. We retained the subordinated interests. On August 12, 2013, we co-originated GBP-denominated first mortgage and mezzanine loans with Starfin Lux S.a.r.l. (“Starfin”), an affiliate of our Manager. The loans are collateralized by a development of a 109 unit retirement community and a 30 key nursing home in Battersea Park, London, England. We and Starfin committed $11.3 million and $22.5 million, respectively, in aggregate for the two loans. The first mortgage loan bears interest at 5.02% and the mezzanine loan bears interest at 15.12%, and the loans each have three-year terms. On September 13, 2013, we co-originated a EUR-denominated first mortgage loan with Starfin. The loan had an initial funding of approximately $102.3 million ($53.8 million for us and $48.5 million for Starfin), and future funding commitments totaling $24.6 million, of which the Company is committed to fund $12.9 million and Starfin is committed to fund $11.7 million. The loan bears interest at three-month EURIBOR plus 7.0% and is secured by a portfolio of approximately 20 retail properties located throughout Finland. The loan matures in October 2016. *Related Party Arrangements Resulting from the LNR Acquisition* As discussed in Note 8, we acquired 50% of a joint venture in connection with our acquisition of LNR. An affiliate of ours, Fund IX, owns the remaining 50% of the venture. As described in Note 4, in connection with the LNR acquisition, we were required to cash collateralize certain obligations of LNR, including letters of credit and performance obligations. Fund IX funded $6.2 million of this obligation, but the account is within our name and is thus reflected within our restricted cash balance. We have recognized a corresponding payable to Fund IX of $6.2 million within related party payable in our condensed consolidated balance sheets as of September 30, 2013.

16. Related-Party Transactions

Management Agreement

We entered into a Management Agreement with our Manager upon closing of our IPO, which provides for an initial term of three years with automatic one-year extensions thereafter unless terminated as described below. Under the Management Agreement, our Manager, subject to the oversight of our board of directors, is required to manage our day-to-day activities, for which our Manager receives a base management fee and is eligible for an incentive fee and stock awards. Our Manager is also entitled to charge us for certain expenses incurred on our behalf, as described below. Refer to our consolidated financial statements and notes thereto included in our Form 10-K for further discussion of this agreement.

Base Management Fee. For the three and nine months ended September 30, 2013, approximately $13.5 million and $35.9 million, respectively, was incurred for base management fees. For the three and nine months ended September 30, 2012, approximately $8.5 million and $23.3 million, respectively, was incurred for base management fees. Management fee payable as of September 30, 2013 and December 31, 2012 was $13.5 million and $0, respectively.

Incentive Fee. For the three and nine months ended September 30, 2013, approximately $4.8 million and $4.8 million, respectively, was incurred in incentive fees. For the three and nine months ended September 30, 2012, $2.1 million and $7.5 million, respectively, were incurred in incentive fees. During the quarter ended September 30, 2012, we paid the Manager $2.3 million of the incentive fee earned, 50% in cash and the remaining 50% in stock through the issuance of 50,203 shares of common stock at a price of $22.61 per share. Incentive fee payable as of September 30, 2013 and December 31, 2012 was $4.8 million and $0.7 million, respectively.

Expense Reimbursement. For the three and nine months ended September 30, 2013, approximately $1.8 million and $6.3 million was incurred, respectively, for executive compensation and other reimbursable expenses of which approximately $1.1 million and $1.1 million was payable as of September 30, 2013 and December 31, 2012, respectively. For the three and nine months ended September 30, 2012, approximately $1.7 million and $4.6 million was incurred, respectively, for executive compensation and other reimbursable expenses.

Loan Investments

On October 16, 2012, we co-originated $475.0 million in financing for the acquisition and redevelopment of a 10 story retail building located at 701 Seventh Avenue in the Times Square area of Manhattan through a joint venture with Starwood Distressed Opportunity Fund IX (“Fund IX”), an affiliate of our Manager. The financing consists of a fully funded $237.5 million first mortgage loan and a $237.5 million mezzanine loan, of which $137.5 million was funded at close. The remaining $100.0 million will be funded upon reaching certain milestones during the transformation of the property. On October 22, 2012, the joint venture sold a 25% participation in both the first mortgage and mezzanine loan to Vornado Realty Trust (“Vornado”). Upon settling this sale, the Company, Fund IX, and Vornado interest in the first mortgage and mezzanine loans are 56.25%, 18.75% and 25.0%, respectively, and each party will fund their pro rata share of any future fundings. On March 27, 2013, the joint venture, along with Vornado, sold its interest in the first mortgage to Berkadia Proprietary, LLC. Immediately following the sale of the first mortgage, the Company repurchased a 56.25% participation interest in the same first mortgage loan through a wholly owned subsidiary, resulting in no change in net interest for the Company. The joint venture distributed $43.9 million from the sale, net of fees, to Fund IX. The joint venture remains the holder of the mezzanine loan.

On April 17, 2013, we purchased two B-notes for $146.7 million from entities substantially all of whose equity was owned by an affiliate of our Manager. The B-Notes are secured by two Class-A office buildings located in Austin, Texas. On May 17, 2013, we sold senior participation interests in the B-notes to a third party, generating $95.0 million in aggregate proceeds. We retained the subordinated interests.

On August 12, 2013, we co-originated GBP-denominated first mortgage and mezzanine loans with Starfin Lux S.a.r.l. (“Starfin”), an affiliate of our Manager. The loans are collateralized by a development of a 109 unit retirement community and a 30 key nursing home in Battersea Park, London, England. We and Starfin committed $11.3 million and $22.5 million, respectively, in aggregate for the two loans. The first mortgage loan bears interest at 5.02% and the mezzanine loan bears interest at 15.12%, and the loans each have three-year terms.

On September 13, 2013, we co-originated a EUR-denominated first mortgage loan with Starfin. The loan had an initial funding of approximately $102.3 million ($53.8 million for us and $48.5 million for Starfin), and future funding commitments totaling $24.6 million, of which the Company is committed to fund $12.9 million and Starfin is committed to fund $11.7 million. The loan bears interest at three-month EURIBOR plus 7.0% and is secured by a portfolio of approximately 20 retail properties located throughout Finland. The loan matures in October 2016.

Related Party Arrangements Resulting from the LNR Acquisition

As discussed in Note 8, we acquired 50% of a joint venture in connection with our acquisition of LNR. An affiliate of ours, Fund IX, owns the remaining 50% of the venture.

As described in Note 4, in connection with the LNR acquisition, we were required to cash collateralize certain obligations of LNR, including letters of credit and performance obligations. Fund IX funded $6.2 million of this obligation, but the account is within our name and is thus reflected within our restricted cash balance. We have recognized a corresponding payable to Fund IX of $6.2 million within related party payable in our condensed consolidated balance sheets as of September 30, 2013.