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MORTGAGE LOAN RECEIVABLES (Tables)
 6 Months Ended
Jun. 30, 2018
SEC Schedule, 12-29, Real Estate Companies, Investment in Mortgage Loans on Real Estate [Abstract]  
Schedule of mortgage loan receivables
December 31, 2017 ($ in thousands)
 
 
Outstanding
Face Amount
 
Carrying
Value
 
Weighted
Average
Yield (1)
 
Remaining
Maturity
(years)
 
 
 
 
 
 
 
 
Mortgage loans held by consolidated subsidiaries
$
3,300,709

 
$
3,282,462

 
7.18
%
 
1.61
Provision for loan losses
N/A

 
(4,000
)
 
 
 
 
Mortgage loan receivables held for investment, net, at amortized cost
3,300,709

 
3,278,462

 
 
 
 
Mortgage loan receivables held for sale
232,527

 
230,180

 
4.88
%
 
8.17
Total
3,533,236

 
3,508,642

 
7.03
%
 
2.04
 
(1)
December 31, 2017 LIBOR rates are used to calculate weighted average yield for floating rate loans.
June 30, 2018 ($ in thousands)
 
 
Outstanding
Face Amount
 
Carrying
Value
 
Weighted
Average
Yield (1)
 
Remaining
Maturity
(years)
 
 
 
 
 
 
 
 
Mortgage loans held by consolidated subsidiaries(2)
$
3,788,546

 
$
3,764,172

 
7.70
%
 
1.48
Provision for loan losses
N/A

 
(7,300
)
 
 
 
 
Mortgage loan receivables held for investment, net, at amortized cost
3,788,546

 
3,756,872

 
 
 
 
Mortgage loan receivables held for sale
108,340

 
107,744

 
5.24
%
 
9.79
Total
$
3,896,886

 
$
3,864,616

 
7.65
%
 
1.71
 
(1)
June 30, 2018 London Interbank Offered Rate (“LIBOR”) rates are used to calculate weighted average yield for floating rate loans.
(2)
Includes amounts relating to consolidated variable interest entities. See Note 3.
Summary of mortgage loan receivables by loan type
The following table summarizes mortgage loan receivables by loan type ($ in thousands):
 
 
June 30, 2018
 
December 31, 2017
 
Outstanding
Face Amount
 
Carrying
Value
 
Outstanding
Face Amount
 
Carrying
Value
 
 
 
 
 
 
 
 
Mortgage loan receivables held for investment, net, at amortized cost:
 

 
 

 
 

 
 

First mortgage loans
$
3,630,000

 
$
3,606,248

 
$
3,140,788

 
$
3,123,268

Mezzanine loans
158,546

 
157,924

 
159,921

 
159,194

Mortgage loan receivables held for investment, net, at amortized cost
3,788,546

 
3,764,172

 
3,300,709

 
3,282,462

Mortgage loan receivables held for sale
 

 
 

 
 

 
 

First mortgage loans
108,340

 
107,744

 
232,527

 
230,180

Total mortgage loan receivables held for sale
108,340

 
107,744

 
232,527

 
230,180

 
 
 
 
 
 
 
 
Provision for loan losses
N/A

 
(7,300
)
 
N/A

 
(4,000
)
Total
$
3,896,886

 
$
3,864,616

 
$
3,533,236

 
$
3,508,642
Schedule of activity in loan portfolio
For the six months ended June 30, 2018 and 2017, the activity in our loan portfolio was as follows ($ in thousands):

 
Mortgage loan receivables held for investment, net, at amortized cost:
 
 
 
Mortgage loans held by consolidated subsidiaries
 
Provision for loan losses
 
Mortgage loan 
receivables held
for sale
 
 
 
 
 
 
Balance, December 31, 2017
$
3,282,462

 
$
(4,000
)
 
$
230,180

Origination of mortgage loan receivables
914,489

 
—

 
764,948

Purchases of mortgage loan receivables
—

 
—

 
—

Repayment of mortgage loan receivables
(497,124
)
 
—

 
(286
)
Proceeds from sales of mortgage loan receivables
—

 
—

 
(842,727
)
Realized gain on sale of mortgage loan receivables(1)
—

 
—

 
11,032

Transfer between held for investment and held for sale(2)
55,403

 
—

 
(55,403
)
Accretion/amortization of discount, premium and other fees
8,942

 
—

 
—

Loan loss provision
—

 
(3,300
)
 
—

Balance, June 30, 2018
$
3,764,172

 
$
(7,300
)
 
$
107,744

 

(1)
Includes $0.5 million of realized losses on loans related to lower of cost or market adjustments for the six months ended June 30, 2018.
(2)
During the six months ended June 30, 2018, the Company reclassified from mortgage loan receivables held for sale to mortgage loan receivables held for investment, net, at amortized cost, three loans with a combined outstanding face amount of $57.6 million, a combined book value of $55.4 million (fair value at date of reclassification) and a remaining maturity of 2.5 years. The loans had been recorded at lower of cost or market prior to their reclassification. The discount to fair value is the result of an increase in market interest rates since the loan’s origination and not a deterioration in credit of the borrower or collateral coverage and the Company expects to collect all amounts due under the loan. These transfers have been reflected as non-cash items on the consolidated statement of cash flows for the six months ended June 30, 2018.

 
Mortgage loan receivables held for investment, net, at amortized cost:
 
 
 
Mortgage loans held by consolidated subsidiaries
 
Provision for loan losses
 
Mortgage loan
receivables held
for sale
 
 
 
 
 
 
Balance, December 31, 2016
$
2,000,095

 
$
(4,000
)
 
$
357,882

Origination of mortgage loan receivables
563,392

 
—

 
564,492

Purchases of mortgage loan receivables
94,079

 
—

 
—

Repayment of mortgage loan receivables
(155,325
)
 
—

 
(1,184
)
Proceeds from sales of mortgage loan receivables
—

 
—

 
(563,929
)
Realized gain on sale of mortgage loan receivables(1)
—

 
—

 
24,905

Transfer between held for investment and held for sale(2)
119,952

 
—

 
(119,952
)
Accretion/amortization of discount, premium and other fees
4,539

 
—

 
—

Balance, June 30, 2017
$
2,626,732

 
$
(4,000
)
 
$
262,214

 
(1)
Includes $1.0 million of realized losses on loans related to lower of cost or market adjustments for the six months ended June 30, 2017.
(2)
During the six months ended June 30, 2017, the Company reclassified from mortgage loan receivables held for sale to mortgage loan receivables held for investment, net, at amortized cost, a loan with an outstanding face amount of $120.0 million, a book value of $119.9 million (fair value at date of reclassification) and a remaining maturity of three years. The loan had been recorded at lower of cost or market prior to its reclassification. The discount to fair value is the result of an increase in market interest rates since the loan’s origination and not a deterioration in credit of the borrower or collateral coverage and the Company expects to collect all amounts due under the loan. This transfer has been reflected as a non-cash item on the consolidated statement of cash flows for the six months ended June 30, 2017.
Schedule of provision for loan losses
Provision for Loan Losses ($ in thousands)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2018
 
2017
 
2018
 
2017
 
 
 
 
 
 
 
 
Provision for loan losses at beginning of period
$
7,000

 
$
4,000

 
$
4,000

 
$
4,000

Provision for loan losses
300

 
—

 
3,300

 
—

Provision for loan losses at end of period
$
7,300

 
$
4,000

 
$
7,300

 
$
4,000