Notes Receivable, Net

12 Months Ended

Dec. 31, 2016

Accounts and Notes Receivable, Net [Abstract]

Notes Receivable, Net

Notes Receivable, Net

The Company’s notes receivable, net were collateralized either by the underlying properties, the borrower’s ownership interest in the entities that own the properties and/or by the borrower’s personal guarantee, and were as follows (dollars in thousands):

	Number of Instruments December 31, 2016	December 31,
Description		2016		2015		Maturity Date at December 31, 2016	Interest Rate at December 31, 2016
Core Portfolio	10	$	216,400	$	113,048	May 2017 - September 2019	6.0% - 9.0%
Fund II	1	31,007		30,234		May 2020	2.5%
Fund III	1	4,506		3,906		July 2017	18.0%
Fund IV	3	24,250		—		April 2017 - February 2021	6.0% - 15.3%
	15	$	276,163	$	147,188

During 2016, the Company:

• issued one Core note receivable and three Fund IV notes receivable aggregating $47.5 million with a weighted-average effective interest rate of 9.8%, which were collateralized by four mixed-use real estate properties;

• received total collections of $42.8 million, including full repayment of five notes issued in prior periods aggregating $29.6 million; and

• restructured a $30.9 million Core mezzanine loan, which bore interest at 15.0%, and replaced it with a new $153.4 million loan collateralized by a first mortgage in the borrower's tenancy-in-common interest. The new loan, which was made to our partners in the Brandywine Portfolio, bears interest at 8.1% (Note 4).

During 2015, the Company:

• made total investments in six notes receivable of $78.0 million, with a weighted-average effective interest rate of 6.2%, which were collateralized by six mixed-use real estate properties; and

• received total collections of $29.4 million, including full repayment of four notes issued in prior periods aggregating $22.9 million.

At December 31, 2016 and 2015, one of the Core notes receivable in the amount of $12.0 million was in default; however, no principal reserve was established because the estimated fair value of the real estate collateral exceeded the carrying value of the note.

The Company monitors the credit quality of its notes receivable on an ongoing basis and considers indicators of credit quality such as loan payment activity, the estimated fair value of the underlying collateral, the seniority of the Company's loan in relation to other debt secured by the collateral and the prospects of the borrower.

Earnings from these notes and mortgages receivable are reported within the Company's Structured Financing segment (Note 12).