Notes Receivable and Current Expected Credit Losses (Tables)

3 Months Ended

Mar. 31, 2020

Receivables [Abstract]

Summary of Mezzanine Loans

The Company had the following notes receivable outstanding as of March 31, 2020 and December 31, 2019 ($ in thousands):

	Outstanding loan amount										Interest compounding
Development Project	March 31, 2020			December 31, 2019		Maximum loan commitment		Interest rate
The Residences at Annapolis Junction	$	42,517		$	40,049	$	48,105	10.0	%		Monthly
Delray Plaza	15,484			12,995		17,000		15.0	%	(a)	Annually
Nexton Square	15,904			15,097		17,000		10.0	%		Monthly
Interlock Commercial	75,846			59,224		95,000		15.0	%		None
Solis Apartments at Interlock	26,425			25,588		41,100		13.0	%		Annually
Total mezzanine	176,176			152,953		$	218,205
Other notes receivable	1,167			1,147
Notes receivable guarantee premium	4,511			5,271
Allowance for credit losses	(3,202		)	—
Total notes receivable	$	178,652		$	159,371

Summary of Interest Income

The Company recognized interest income for the three months ended March 31, 2020 and 2019 as follows (in thousands):

	Three Months Ended March 31,
Development Project	2020			2019
1405 Point	$	—		$	610
The Residences at Annapolis Junction	2,468		(a)	2,024		(b)
North Decatur Square	—			638
Delray Plaza	489			310
Nexton Square	391			510
Interlock Commercial	3,017		(a)	743
Solis Apartments at Interlock	838			463
Total mezzanine	7,203			5,298
Other interest income	23			21
Total interest income	$	7,226		$	5,319

________________________________________

(a) Includes partial recognition of interest income related to an exit fee that is due upon repayment of the loan.

(b) Includes amortization of the $5.0 million loan modification fee paid by the borrower in November 2018.

Financing Receivable Credit Quality Indicators

The following table presents amortized cost basis of the portfolio by year of origination and risk rating as of March 31, 2020 (in thousands):

	Year of Origination
Risk Ratings	2020		2019		2018		2017		2016		Total
Pass	$	—	$	—	$	120,495	$	—	$	—	$	120,495
Special Mention	—		—		—		—		—		—
Substandard	—		—		—		14,839		42,150		56,989
Total amortized cost basis	$	—	$	—	$	120,495	$	14,839	$	42,150	$	177,484

Allowance for Credit Losses on Financing Receivables

Changes in the allowance for the three months ended March 31, 2020 were as follows (in thousands):

	Three Months Ended March 31, 2020
Beginning balance (December 31, 2019)	$	—
Cumulative effect of accounting change	2,825
Provision for unrealized credit losses	377
Ending balance	$	3,202