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FINANCIAL INSTRUMENTS
12 Months Ended
Dec. 31, 2019
Financial Instruments [Abstract]  
FINANCIAL INSTRUMENTS

NOTE 14 - FINANCIAL INSTRUMENTS

The net carrying amount of cash and cash equivalents, restricted cash, contractual receivables, other assets and accrued expenses and other liabilities reported in the Consolidated Balance Sheets approximates fair value because of the short maturity of these instruments (Level 1).

At December 31, 2019 and 2018, the net carrying amounts and fair values of other financial instruments were as follows:

    

December 31, 2019

December 31, 2018

    

Carrying

    

Fair

    

Carrying

    

Fair

    

Amount

    

Value

    

Amount

    

Value

(in thousands)

Assets:

Investments in direct financing leases – net

 

$

11,488

$

11,488

    

$

132,262

    

$

132,262

Mortgage notes receivable – net

 

773,563

 

819,083

 

710,858

 

735,892

Other investments – net

 

419,228

 

412,934

 

504,626

 

503,907

Total

$

1,204,279

$

1,243,505

$

1,347,746

$

1,372,061

Liabilities:

 

  

 

  

 

  

 

  

Revolving line of credit

$

125,000

$

125,000

$

313,000

$

313,000

Term loan

2,275

2,275

U.S. term loan

 

348,878

 

350,000

 

423,065

 

425,000

Sterling term loan

 

132,059

 

132,480

 

127,394

 

127,990

Omega OP term loan

 

74,763

 

75,000

 

99,553

 

100,000

2015 term loan

 

249,038

 

250,000

 

248,713

 

250,000

4.375% notes due 2023 – net

 

695,812

 

749,693

 

694,643

 

700,062

4.95% notes due 2024 – net

 

395,702

 

442,327

 

394,691

 

406,386

4.50% notes due 2025 – net

 

396,163

 

430,529

 

395,402

 

392,122

5.25% notes due 2026 – net

 

595,732

 

675,078

 

595,027

 

605,700

4.50% notes due 2027 – net

 

689,445

 

759,475

 

687,981

 

671,555

4.75% notes due 2028 – net

 

541,891

 

602,967

 

540,883

 

537,508

3.625% notes due 2029 – net

488,263

500,792

HUD mortgages - net

387,405

379,866

Subordinated debt – net

 

13,714

 

15,253

 

20,270

 

22,589

Total

$

5,136,140

$

5,490,735

$

4,540,622

$

4,551,912

Fair value estimates are subjective in nature and are dependent on a number of important assumptions, including estimates of future cash flows, risks, discount rates and relevant comparable market information associated with each financial instrument (see Note 2 – Summary of Significant Accounting Policies). The use of different market assumptions and estimation methodologies may have a material effect on the reported estimated fair value amounts.

The following methods and assumptions were used in estimating fair value disclosures for financial instruments.

Direct financing leases:  The fair value of the investments in direct financing leases, excluding those related to Orianna, are estimated using a discounted cash flow analysis, using interest rates being offered for similar leases to borrowers with similar credit ratings (Level 3). For the Orianna direct financing lease as of December 31, 2018, the Company estimated the fair value of its investment based on the expected liquidating payments from the Trust as further described in Note 4 – Direct Financing Leases (Level 3).  
Mortgage notes receivable:  The fair value of the mortgage notes receivables are estimated using a discounted cash flow analysis, using interest rates being offered for similar loans to borrowers with similar credit ratings (Level 3).
Other investments:  Other investments are primarily comprised of notes receivable. The fair values of notes receivable are estimated using a discounted cash flow analysis, using interest rates being offered for similar loans to borrowers with similar credit ratings (Level 3).
Revolving line of credit, secured borrowing and term loans:  The fair value of our borrowings under variable rate agreements are estimated using a present value technique based on expected cash flows discounted using the current market rates (Level 3).
Senior notes and subordinated debt:  The fair value of our borrowings under fixed rate agreements are estimated using a present value technique based on inputs from trading activity provided by a third party (Level 2).
HUD mortgages: The fair value of our borrowings under HUD debt agreements are estimated using an expected present value technique based on quotes obtained by HUD debt brokers (Level 2).