REAL ESTATE AND RELATED LEASE INTANGIBLES, NET (Tables)

6 Months Ended

Jun. 30, 2019

Real Estate [Abstract]

Schedule of real estate properties by category

The following tables present additional detail related to our real estate portfolio, net, including foreclosed properties ($ in thousands):

	June 30, 2019			December 31, 2018
Land	$	197,086		$	195,644
Building	817,595			814,314
In-place leases and other intangibles	158,868			162,002
Less: Accumulated depreciation and amortization	(189,172		)	(173,938		)
Real estate and related lease intangibles, net	$	984,377		$	998,022
Below market lease intangibles, net (other liabilities)	$	(39,163	)	$	(40,367	)

Schedule of depreciation and amortization expense recorded

The following table presents depreciation and amortization expense on real estate recorded by the Company ($ in thousands):

	Three Months Ended June 30,				Six Months Ended June 30,
	2019		2018		2019		2018
Depreciation expense (1)	$	7,697	$	8,208	$	15,382	$	15,995
Amortization expense	2,213		2,429		4,730		5,447
Total real estate depreciation and amortization expense	$	9,910	$	10,637	$	20,112	$	21,442

(1)

Depreciation expense on the consolidated statements of income also includes $25 thousand and $19 thousand of depreciation on corporate fixed assets for the three months ended June 30, 2019 and 2018, respectively, and $50 thousand and $37 thousand of depreciation on corporate fixed assets for the six months ended June 30, 2019 and 2018, respectively.

Schedule of expected amortization expense related to the acquired in-place lease intangibles, for property owned

The following table presents expected adjustment to operating lease income and expected amortization expense during the next five years and thereafter related to the above and below market leases and acquired in-place lease and other intangibles for property owned as of June 30, 2019 ($ in thousands):

Period Ending December 31,	Adjustment to Operating Lease Income		Amortization Expense
2019 (last 6 months)	$	517	$	3,327
2020	1,036		6,347
2021	1,037		6,259
2022	1,041		6,195
2023	1,041		6,195
Thereafter	29,756		66,043
Total	$	34,428	$	94,366

Schedule of contractual future minimum rent under leases

The following is a schedule of non-cancellable, contractual, future minimum rent under leases (excluding property operating expenses paid directly by tenant under net leases) at June 30, 2019 ($ in thousands):

 

Period Ending December 31,	Amount
2019 (last 6 months)	$	42,016
2020	77,970
2021	68,304
2022	64,406
2023	62,219
Thereafter	510,864
Total	$	825,779

Schedule of real estate properties acquired

The purchase prices were allocated to the asset acquisitions during the six months ended June 30, 2018, as follows ($ in thousands):

	Purchase Price Allocation
Land	$	40,019
Building	73,794
Intangibles	2,065
Below Market Lease Intangibles	(330		)
Total purchase price	$	115,548

During the six months ended June 30, 2018, the Company acquired the following properties ($ in thousands):

Acquisition Date	Type	Primary Location(s)	Purchase Price		Ownership Interest (1)
March 2018	Diversified(2)	Lithia Springs, GA	$	24,466	70.6%
April 2018	Net Lease	Kirbyville, MO	1,156		100.0%
April 2018	Net Lease	Gladwin, MI	1,171		100.0%
April 2018	Net Lease	Foley, MN	1,176		100.0%
April 2018	Net Lease	Moscow Mills, MO	1,237		100.0%
April 2018	Net Lease	Wonder Lake, IL	1,255		100.0%
May 2018	Diversified(3)	Isla Vista, CA	85,087		75.0%
Total real estate acquisitions			$	115,548

(1) Properties were consolidated as of acquisition date.

(2) Joint venture partner contributed $2.9 million to the partnership.

(3)

Joint venture partner contributed $4.6 million to the partnership.

During the six months ended June 30, 2019, the Company acquired the following properties ($ in thousands):

Acquisition Date	Type	Primary Location(s)	Purchase Price/Fair Value on the Date of Foreclosure		Ownership Interest (1)
Purchases of real estate
February 2019	Net Lease	Houghton Lake, MI	$	1,242	100.0%
February 2019	Net Lease	Trenton, MO	1,164		100.0%
April 2019	Net Lease	Centralia, IL	1,242		100.0%
June 2019	Net Lease	Fayette, MO	1,423		100.0%
Total purchases of real estate			5,071
Real estate acquired via foreclosure
February 2019	Diversified	Omaha, NE	18,200		100.0%
Total real estate acquired via foreclosure			18,200
Total real estate acquisitions			$	23,271

(1)

Properties were consolidated as of acquisition date.

The purchase prices were allocated to the asset acquisitions during the six months ended June 30, 2019, as follows ($ in thousands):

	Purchase Price Allocation
Land	$	3,789
Building	18,885
Intangibles	854
Below Market Lease Intangibles	(257		)
Total purchase price	$	23,271

Schedule of properties sold

The Company sold the following properties during the six months ended June 30, 2019 ($ in thousands):

Sales Date	Type	Primary Location(s)	Net Sales Proceeds		Net Book Value		Realized Gain/(Loss)				Properties	Units Sold	Units Remaining
N/A	Condominium	Las Vegas, NV	$	—	$	—	$	—			—	—	1
Various	Condominium	Miami, FL	3,917		3,550		367				—	13	9
April 2019	Diversified	Wayne, NJ	1,729		4,799		(3,070		)	(1)	1	—	—
May 2019	Diversified	Grand Rapids, MI	10,019		8,254		1,765			(2)	1	—	—
Totals			$	15,665	$	16,603	$	(938	)

The Company sold the following properties during the six months ended June 30, 2018 ($ in thousands):

Sales Date	Type	Primary Location(s)	Net Sales Proceeds		Net Book Value		Realized Gain/(Loss)			Properties	Units Sold	Units Remaining
Various	Condominium	Las Vegas, NV	$	4,509	$	1,939	$	2,570		—	6	7
Various	Condominium	Miami, FL	3,296		2,662		634			—	12	36
March 2018	Diversified	El Monte, CA	71,807		52,610		19,197		(1)	1	—	—
March 2018	Diversified	Richmond, VA	20,966		11,370		9,596		(2)	1	—	—
Totals			$	100,578	$	68,581	$	31,997

(1) This property had a third party investor. The third party investor has been allocated $7.0 million of the realized gain, which is included in net (income) loss attributable to noncontrolling interest in consolidated joint ventures, for the six months ended June 30, 2018, on the consolidated statements of income.

(2)

This property had a third party investor. The third party investor has been allocated $0.4 million of the realized gain, which is included in net (income) loss attributable to noncontrolling interest in consolidated joint ventures, for the six months ended June 30, 2018, on the consolidated statements of income.