The Company’s loans receivable portfolio as of December 31, 2021 was comprised of the following loans (in thousands, except for number of investments and number of loans):

	Number of Investments	Number of Loans	Loan Commitment⁽⁵⁾		Principal Outstanding		Carrying Value			Weighted Average Stated Rate⁽²⁾			Weighted Average Interest Rate⁽⁴⁾
Loans receivable held-for-investment:
Variable:
Senior loans^(1,3)	51	88	$	7,163,032	$	6,119,619	$	6,085,351			L + 4.06%	%		5.16	%
Subordinate loans	3	4		137,079		133,119		133,552			L + 10.38%	%		11.37	%
				7,300,111		6,252,738		6,218,903			L + 4.19%	%		5.29	%
Fixed:
Senior loans⁽¹⁾	3	4	$	62,573	$	62,573	$	62,782						10.09	%
Subordinate loans	2	2		125,927		125,927		125,620						8.49	%
				188,500		188,500		188,402						9.02	%
Total/Weighted Average			$	7,488,611	$	6,441,238	$	6,407,305						5.40	%
Allowance for loan losses								(67,010	)
Loans receivable held-for-investment, net							$	6,340,295

The Company’s loans receivable portfolio as of December 31, 2020 was comprised of the following loans (in thousands, except for number of investments and number of loans):

	Number of Investments	Number of Loans	Loan Commitment⁽⁵⁾		Principal Outstanding		Carrying Value⁽⁶⁾		Weighted Average Stated Rate⁽²⁾			Weighted Average Interest Rate⁽⁴⁾
Loans receivable held-for- investment
Variable:
Senior loans^(1,3)	46	80	$	6,395,473	$	5,272,201	$	5,252,577		L + 4.35%	%		5.93	%
Subordinate loans	8	11		852,982		782,646		782,167		L + 8.72%	%		10.20	%
				7,248,455		6,054,847		6,034,744		L + 4.91%	%		6.48	%
Fixed:
Senior loans⁽¹⁾	2	3	$	75,669	$	75,669	$	69,523					12.59	%
Subordinate loans	2	2		25,527		21,815		21,558					11.00	%
				101,196		97,484		91,081					12.24	%
Total/Weighted Average			$	7,349,651	$	6,152,331	$	6,125,825					6.57	%

Certain loans receivable held by the Company include LIBOR floors, which establish the minimum interest rate a borrower may pay on a loan. The weighted average LIBOR floor in place based on unpaid principal balance on floating rate loans is 1.1% as of December 31, 2021.

One-month LIBOR Floor Range	Unpaid Principal Balance		% of Total			Cumulative %
Fixed rate	$	221,963		3	%		3	%
2.00% - 2.50%		1,333,912		21	%		24	%
1.50% - 1.99%		1,381,483		22	%		46	%
1.00% - 1.49%		815,291		13	%		59	%
0.50% - 0.99%		210,930		3	%		62	%
< 0.50%		1,545,111		24	%		86	%
No floor		932,548		14	%		100	%
Total	$	6,441,238

As of December 31, 2021 and 2020, the weighted average yield to maturity on loans receivable was 5.6% and 7.0%, respectively. For loans that are floating rate loans, the weighted average yield was calculated using the respective applicable benchmark rates, incorporating the impact of LIBOR floors, as applicable. The weighted average term to initial maturity of the loans receivable portfolio is 1.8 years and 1.4 years as of December 31, 2021 and 2020, respectively. The weighted average term to maturity with the exercise of all extension options is 3.3 years and 3.1 years as of December 31, 2021 and 2020, respectively.

There was a total of $366.5 million and $615.8 million of outstanding principal balance on non-accrual status at December 31, 2021 and 2020, respectively. There were six investments representing 5.6% of the loans receivable and interests in loans receivable portfolio on non-accrual status at December 31, 2021, of which there were four investments, representing $273.6 million or 4.1% of the loans receivable and interests in loans receivable portfolio, on non-accrual status as a result of interest payments becoming 90 days past due. During the years ended December 31, 2021 and 2020, $3.4 million and $0, respectively, of income was recognized related to one of these loans while on non-accrual status. There were five investments representing $382.3 million of outstanding principal balance, or 5.9% of the loans receivable and interests in loans receivable portfolio at December 31, 2020 on non-accrual status as a result of interest payments becoming 90 days past due. There were no loans greater than 90 days past due that are on accrual status.

Additionally, there was one loan, with an outstanding principal balance of $233.5 million at December 31, 2020, representing 3.6% of the loans receivable and interests in loans receivable portfolio at December 31, 2020 which had been placed on non-accrual status as a result of interest payments becoming 90 days past due, which was modified in December 2020 resulting in all past due interest being paid, in cash or compounded into the loan balance, bringing the loan current. Pursuant to GAAP, this loan was accounted for on a cash basis following the modification, meaning that interest income is recognized when received, until all principal and interest payments contractually due are reasonably assured of repayment and there is a consistent period of repayment by the borrower. The borrower of this loan made interest payments during the year ended December 31, 2021 and the loan was repaid on September 30, 2021. During the year ended December 31, 2021, $15.3 million of income was recognized related to this loan.

During the year ended December 31, 2021, the Company sold a senior loan with a carrying value of $48.1 million and recognized a loss of $0.1 million. The financial asset was legally isolated, the transferee has the ability to pledger the assets without constraint and control has been transferred to the transferee. Management determined the transaction constituted a sale.

During the year ended December 31, 2020, the Company sold a senior loan and a subordinate loan with a total carrying value of $151.7 million and recognized a realized loss of $0.6 million. The financial assets were legally isolated, the transferees have the ability to pledge the assets without constraint, and control has been transferred to the transferees. Management determined the transactions constituted sales.

During the year ended December 31, 2019, the Company sold two senior loans with a total carrying value of $347.2 million, received $4.9 million in repayment proceeds of non-cash interest advances and recognized a net gain of $0.1 million. The financial assets were legally isolated, the transferees have the ability to pledge the assets without constraint, and control has been transferred to the transferees. Management determined the transactions constituted sales.

As of December 31, 2021 and 2020, 46 and 49, respectively, of the Company’s investments were directly financed. See Note 5 – Repurchase Agreements, Loan Participations Sold, Notes Payable and Secured Term Loan, Net for details on the financings.

Activity relating to the loan receivable portfolio for the twelve months ended December 31, 2021 and 2020 (in thousands):

	Held-for- Investment			Held-for- Sale			Total
Balance at December 31, 2020	$	6,125,825		$	-		$	6,125,825
Initial funding of new loan originations and acquisitions		2,331,328			-			2,331,328
Advances on existing loans		623,198			-			623,198
Non-cash advances in lieu of interest		69,291			-			69,291
Origination fees on loans receivable, net		(29,827	)		-			(29,827	)
Exit fees received on loans receivable		(6,558	)		-			(6,558	)
Extension fees received on loans receivable		(2,711	)		-			(2,711	)
Repayments of loans receivable		(2,453,804	)		-			(2,453,804	)
Repayments of non-cash advances to loans in lieu of interest		(126,865	)		-			(126,865	)
Accretion of origination fees, net		25,237			-			25,237
Realized loss on sale of investments		-			(141	)		(141	)
Transfer to loans held for sale		(48,147	)		48,147			-
Sale of loans receivable held-for-sale		-			(48,006	)		(48,006	)
Transfer to real estate owned, net		(103,901	)		-			(103,901	)
Allowance for loan losses		(62,771	)		-			(62,771	)
Balance at December 31, 2021	$	6,340,295		$	-		$	6,340,295

	Held-for- Investment			Held-for- Sale			Total
Balance at December 31, 2019	$	5,940,268		$	—		$	5,940,268
Initial funding of new loan originations and acquisitions		226,661			—			226,661
Advances on existing loans		568,767			—			568,767
Non-cash advances in lieu of interest		90,065			—			90,065
Origination fees on loans receivable, net		(3,761	)		—			(3,761	)
Exit fees received on loans receivable		(1,247	)		—			(1,247	)
Extension fees received on loans receivable		(801	)		—			(801	)
Repayments of loans receivable		(548,545	)		—			(548,545	)
Repayments of non-cash advances to loans in lieu of interest		(15,784	)		—			(15,784	)
Accretion of origination fees, net		27,859			—			27,859
Realized loss on sale of investments		—			(640	)		(640	)
Transfer to loans held-for-sale		(151,657	)		151,657			—
Sale of loans receivable held-for-sale		—			(151,017	)		(151,017	)
Allowance for loan losses		(6,000	)		—			(6,000	)
Balance at December 31, 2020	$	6,125,825		$	—		$	6,125,825

The Company had one interest in loans receivable as of December 31, 2021 (in thousands):

The Company’s interests in loans receivable portfolio as of December 31, 2020 was comprised of the following loans (in thousands):

As of December 31, 2021 and 2020, the weighted average yield to maturity on interests in loans receivable was 6.7% and 5.9%, respectively. As all of the interests in loans are floating rate loans, the weighted average yield was calculated using the respective applicable benchmark rates, incorporating the impact of LIBOR floors, as applicable. The weighted average term to initial maturity of the interests in loans receivable portfolio is 0.1 and 0.8 years as of December 31, 2021 and 2020, respectively. The weighted average term to maturity with the exercise of all extension options is 1.6 and 2.1 years as of December 31, 2021 and 2020, respectively.

As of December 31, 2021 and 2020, all of the Company’s interests in loans receivable were directly financed. See Note 5 – Repurchase Agreements, Loan Participations Sold, Notes Payable and Secured Term Loan, net for details on the financings.

Activity relating to the interests in loan receivable portfolio for the years ended December 31, 2021 and 2020 (in thousands):

	December 31, 2021			December 31, 2020
Balance at beginning of period	$	338,270		$	222,891
Advances on existing interests in loans receivable		101,767			118,582
Non-cash advances to interests in loans receivable in lieu of interest		18,733			13,782
Exit fees received on interests in loans receivable		(265	)		—
Extension fees received on interests in loans receivable		—			(453	)
Repayments of interests in loans receivable		(269,988	)		(15,417	)
Repayment of non-cash advances to interests in loans receivable in lieu of interest		(27,903	)		(1,566	)
Accretion of origination fees, net		1,250			451
Allowance for loan loss		(14	)		—
Balance at end of period	$	161,850		$	338,270

The following table presents the Company’s loans receivable and interests in loans receivable portfolio by loan type, as well as property type and geographic location of the properties collateralizing these loans as of December 31, 2021 and 2020 (dollars in thousands):

	December 31, 2021						December 31, 2020
Loan Type (1)	Carrying Value			Percentage			Carrying Value ⁽²⁾		Percentage
Senior loans⁽¹⁾	$	6,309,997			96	%	$	5,660,370		88	%
Subordinate loans		259,172			4	%		803,725		12	%
	$	6,569,169			100	%	$	6,464,095		100	%
Allowance for loan losses	$	(67,024	)
	$	6,502,145

Property Type	Carrying Value			Percentage			Carrying Value ⁽²⁾		Percentage
Office	$	1,113,805			17	%	$	1,056,109		16	%
Mixed-use		734,613			11	%		1,336,337		21	%
Hospitality		1,176,842			18	%		1,051,658		16	%
Land		631,713			10	%		525,147		8	%
Multifamily		1,986,628			30	%		1,462,450		23	%
For Sale Condo		710,660			11	%		902,812		14	%
Other		214,908			3	%		129,582		2	%
	$	6,569,169			100	%	$	6,464,095		100	%
Allowance for loan losses	$	(67,024	)
	$	6,502,145

Geographic Location	Carrying Value			Percentage			Carrying Value ⁽²⁾		Percentage
United States
Northeast	$	2,734,550			41	%	$	3,078,980		48	%
Mid Atlantic		1,235,527			19	%		1,022,852		16	%
Midwest		309,298			5	%		237,879		4	%
Southeast		836,904			13	%		918,608		14	%
Southwest		269,461			4	%		87,750		1	%
West		1,156,896			18	%		1,109,026		17	%
Other		26,533			0	%		9,000		0	%
	$	6,569,169			100	%	$	6,464,095		100	%
Allowance for loan losses	$	(67,024	)
	$	6,502,145

The following table summarizes the Company’s interest and accretion income from loans receivable held-for-investment, from loans receivable held-for-sale, from interests in loans receivable held-for-investment, and from interest on cash balances for the years ended December 31, 2021, 2020 and 2019 (in thousands):

As of December 31, 2021 and 2020, no investment exceeded 10% of the Company’s assets. For the years ended December 31, 2021, 2020 and 2019, no investment contributed more than 10% of interest income.

During the year ended December 31, 2021, the Company entered into loan modifications that include, among other items, the repurposing of reserves, temporary partial deferral of the coupon to non-cash advances in lieu of interest, increases in loan commitments, and extensions of loan maturity dates, which in certain cases included incremental capital contributions from certain borrowers.

During the fourth quarter of 2021, the Company entered into a loan modification secured by an office building located in Washington, DC, which is classified as a TDR under GAAP. This modification included, among other items, a waiver of accrued and default interest, reduction of the personal guarantee to $11.2 million, and an extension of the loan’s maturity date. As of December 31, 2021, the loan had an outstanding principal balance and carrying value of $11.5 million. Pursuant to GAAP, this loan will be accounted for on a cost recovery basis following the modification, meaning that all payments received will relieve the unpaid outstanding loan balance until the balance is relieved. Any additional cash received once the original remaining loan balance has been repaid will be recognized as interest income on a cash basis.

During the third quarter of 2021, the Company entered into a loan modification secured by a hospitality asset located in Newport Beach, CA, which is classified as a TDR under GAAP. This modification included, among other items, waiver of default interest, the compounding of $3.4 million of unpaid interest into the unpaid principal balance, the receipt of $1.5 million of unpaid interest in cash, and an extension of the loan’s maturity date. As of December 31, 2021, the loan had an outstanding principal balance of $81.4 million and a carrying value of $77.5 million. Pursuant to GAAP, this loan has been accounted for on a cash basis following the modification, meaning that interest income is recognized when received, until all principal and interest payments contractually due are reasonable assured of repayment and there is a consistent period of repayment by the borrower. The borrower of this loan has made all subsequent interest payments and the loan remains current.

During the fourth quarter of 2020, the Company entered into a loan modification secured by a hospitality asset located in San Diego, CA, which is classified as a TDR under GAAP. This modification included, among other items, a waiver of exit fees, a principal repayment, a reduction of contractual interest payments and an extension of the loan’s maturity date. As of December 31, 2020 the loan had an outstanding principal balance of $97.5 million and a carrying value of $97.3 million. Following the modification, the Company recorded a decrease in contractual exit fees amortized to income of approximately $0.8 million which reduced the Company’s carrying value of the loan receivable. No further loss reserve or impairment were determined to be necessary. Following the modification, this loan returned to accrual status as the borrower funded interest reserves which demonstrated compliance with the restructured terms.

As further described in Note 2 – Summary of Significant Accounting Policies, the Company evaluates the credit quality of its loan portfolio on a quarterly basis. In conjunction with its quarterly loan portfolio review, the Company assesses the risk factors of each loan, and assigns a risk rating based on several factors. Factors considered in the assessment include, but are not limited to, current loan-to-value, debt yield, structure, cash flow volatility, exit plan, current market environment and sponsorship level. Loans are rated “1” (less risk) through “5” (greater risk), which ratings are defined in Note 2 – Summary of Significant Accounting Policies.

The following table allocates the principal balance and carrying value of the loans receivable and interests in loans receivable based on the Company’s internal risk ratings (in thousands):

December 31, 2021
Risk Rating		Number of Loans		Principal Balance		Carrying Value
	1		1	$	35,721	$	35,699
	2		7		705,886		703,714
	3		74		4,678,785		4,649,076
	4		15		1,155,879		1,154,147
	5		2		26,533		26,533
			99	$	6,602,804	$	6,569,169
Allowance for loan losses							(67,024	)
						$	6,502,145

As of December 31, 2021 and 2020, the average risk rating of the Company’s portfolio was 3.1, weighted by outstanding principal balance. At December 31, 2021 and 2020 the Company had loans with an aggregate outstanding principal balance of $1.2 billion and $1.4 billion, respectively, rated as category “4”, which represents 17.5% and 21.1% respectively, of the total portfolio. At December 31, 2021 and 2020, of the loans rated as category “4”, 32.1% and 40.3% respectively, relate to loans secured by hospitality assets. As of December 31, 2021 and 2020, the Company had two and one loans rated at category “5”, which represents 0.4% and 0.2%, respectively, of the total portfolio.

The allowance for loan losses required under GAAP reflects the Company’s current estimate of potential credit losses related to loans receivable, interests in loans receivable, accrued interest receivable and unfunded loan commitments. See Note 2 for further discussion of the Company’s allowance for loan losses.

At December 31, 2020, prior to the adoption of ASU 2016-13, the Company had recorded a $6.0 million provision for loan losses against a loan made to the personal estate of a former borrower, which had an outstanding principal balance and a carrying value of $15.0 million. The loan is on non-accrual status and is in maturity default. The amount of the loan loss provision as of December 31, 2021 and 2020 is based on the difference between the net present value of the projected cash flows of the loan receivable and its amortized cost basis as of December 31, 2021 and 2020.

In December 2021, the Company received principal repayments of $81.7 million on a senior loan with an outstanding principal balance of $95.0 million, and a maturity date of May 31, 2021, and recorded a principal charge-off of $1.8 million. Following the repayment, the maturity date of the loan was extended to January 1, 2023. As of December 31, 2021, the loan had a specific loan loss allowance of $0.3 million, which represents additional collectible interest through the maturity date as the loan remains on non-accrual status.

During year ended December 31, 2021, the Company recorded net reversals of $9.0 million in the allowance for credit losses, thus reducing the total allowance for loan losses to $73.5 million as of December 31, 2021. The decline was primarily attributable to expectations of improving macroeconomic conditions and actual improvements in operating results for many collateral properties adversely affected by COVID-19, as well as principal repayments on loans with allowances for credit losses and changes in unfunded commitments, offset in part by the impact of new loans with longer average term to fully extended maturity.

The following table illustrates the change in the allowance for loan losses for the year ended December 31, 2021 (dollars in thousands):

	Specific CECL Allowance (1)			Loans receivable held-for-investment			Interests in loans receivable held-for-investment			Accrued interest receivable			Unfunded loan commitments (2)			Total
Total allowance for loan losses, December 31, 2020	$	6,000		$	-		$	-		$	-		$	-		$	6,000
Initial CECL allowance, January 1, 2021		-			64,274			406			357			13,214			78,251
Increase (reversal) in allowance		2,094			(3,597	)		(392	)		(139	)		(6,928	)		(8,962	)
Principal charge-offs		(1,761	)		-												(1,761	)
Total allowance for loan losses, December 31, 2021	$	6,333		$	60,677		$	14		$	218		$	6,286		$	73,528
Percent of Unpaid Principal Balance at December 31, 2021																	1.1	%

The Company’s primary credit quality indicator is the Company’s internal risk ratings, which are further discussed above. The following table presents the amortized cost basis of the Company’s loans receivable and interest in loans receivable as of December 31, 2021 by year of origination and risk rating (dollars in thousands):

				Amortized Cost Basis by Origination Year as of December 31, 2021
Risk Rating	Number of Loans	Amortized Cost Basis		2021		2020		2019		2018		2017
1	1	$	35,699	$	-	$	-	$	-	$	35,699	$	-
2	7		703,714		439,981		-		-		236,735		26,998
3	74		4,649,076		1,851,857		276,792		1,991,121		431,913		97,393
4	15		1,154,147		-		-		67,000		1,087,147		-
5	2		26,533		-		-		15,000		-		11,533
	99	$	6,569,169	$	2,291,838	$	276,792	$	2,073,121	$	1,791,494	$	135,924