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LOANS RECEIVABLE AND OTHER INVESTMENTS
 9 Months Ended
Sep. 30, 2019
Receivables [Abstract]  
LOANS RECEIVABLE AND OTHER INVESTMENTS LOANS RECEIVABLE AND OTHER INVESTMENTS
As of September 30, 2019 and December 31, 2018, the Company’s loans receivable and other investments consisted of the following (dollars in thousands):
 
 
 
 
 
 
 
 
 
 
 
 
September 30, 2019
 
 
Investment
 
Quantity
as of
September 30,
2019
 
Property Type
 
Principal Balance
as of
September 30,
2019 (1)
 
Book Value
as of
September 30,
2019
 
Book Value
as of
December 31, 2018
 
Weighted Average Contractual Interest Rate / Rate of Return
 
Weighted Average Annualized Effective Interest Rate / Rate of Return
 
Maturity Date
as of
September 30,
2019
Loans Receivable:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Mortgage
 
1

 
Specialty Hospital
 
$
19,000

 
$
19,000

 
$
18,577

 
10.0
%
 
10.0
%
 
01/31/27
Construction
 
2

 
Senior Housing
 
5,884

 
5,935

 
4,629

 
8.0
%
 
7.7
%
 
10/14/19- 09/30/22
Mezzanine
 
—

 
Skilled Nursing
 
—

 
—

 
2,188

 
N/A

 
N/A

 
N/A
Other
 
17

 
Multiple
 
43,602

 
39,673

 
45,324

 
6.7
%
 
7.1
%
 
09/23/19- 08/31/28
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
20

 
 
 
68,486

 
64,608

 
70,718

 
7.7
%
 
8.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loan loss reserve
 
 
 
—

 
(783
)
 
(1,258
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
$
68,486

 
$
63,825

 
$
69,460

 
 
 
 
 
 
Other Investments:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Preferred Equity
 
9

 
Skilled Nursing / Senior Housing
 
44,005

 
44,417

 
44,262

 
12.0
%
 
12.0
%
 
N/A
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total
 
29

 
 
 
$
112,491

 
$
108,242

 
$
113,722

 
9.4
%
 
9.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

(1) 
Principal balance includes amounts funded and accrued but unpaid interest / preferred return and excludes capitalizable fees.
As of September 30, 2019 and December 31, 2018, the Company had six and seven loans receivable investments, respectively, with an aggregate principal balance of $2.8 million and $27.7 million, respectively, that were considered to have deteriorated credit quality. As of September 30, 2019 and December 31, 2018, the book value of the outstanding loans with deteriorated credit quality was $1.2 million and $4.2 million, respectively. During the nine months ended September 30, 2019, one loan with deteriorated credit quality was repaid.
The following table presents changes in the accretable yield for the three and nine months ended September 30, 2019 and 2018 (in thousands):
 
 
Three Months Ended September 30,
 
Nine Months Ended September 30,
 
 
2019
 
2018
 
2019
 
2018
Accretable yield, beginning of period
 
$
112

 
$
1,081

 
$
449

 
$
2,483

Accretion recognized in earnings
 
(53
)
 
(348
)
 
(357
)
 
(2,477
)
Reduction due to payoff
 
—

 
—

 
(33
)
 
—

Net reclassification from nonaccretable difference
 
—

 
—

 
—

 
727

Accretable yield, end of period
 
$
59

 
$
733

 
$
59

 
$
733

 
 
 
 
 
 
 
 
 

During the three months ended September 30, 2019, the Company recorded no provision for specific loan losses, and during the nine months ended September 30, 2019, the Company recorded a $1.2 million provision for specific loan losses. During the three and nine months ended September 30, 2019, the Company increased its portfolio-based loan loss reserve by $0.1 million and $0.2 million, respectively.
As of September 30, 2019, the Company had no specific loan loss reserve and a $0.8 million portfolio-based loan loss reserve. As of September 30, 2019, the Company did not consider any loans receivable investments to be impaired. As of September 30, 2019, two loans receivable investments with no book value were on nonaccrual status. As of September 30, 2019, the Company did not consider any preferred equity investments to be impaired, and no preferred equity investments were on nonaccrual status.
As of December 31, 2018, the Company had a $0.7 million specific loan loss reserve and a $0.6 million portfolio-based loan loss reserve. As of December 31, 2018, the Company considered one loan receivable investment with a principal balance of $1.3 million to be impaired, and two loans receivable investments with an aggregate book value of $1.3 million were on nonaccrual status. Additionally, as of December 31, 2018, the Company recognized interest income related to one loan
receivable investment, with a book value of $4.3 million, that was more than 90 days past due. As of December 31, 2018, the Company did not consider any preferred equity investments to be impaired, and no preferred equity investments were on nonaccrual status.
During each of the three and nine months ended September 30, 2018, the Company recorded a $0.6 million provision for specific loan losses, and during the three and nine months ended September 30, 2018, the Company increased its portfolio-based loan loss reserve by $0.3 million and $0.6 million, respectively.