Interest income from notes and mortgages receivable is reported within the Company’s Structured Financing segment (Note 12). Interest receivable is included in Other assets, net (Note 5). The Company’s notes receivable, net, are generally collateralized by either the underlying real estate or the borrowers’ equity interests in the entities that own the properties. The balances were as follows (dollars in thousands):


	June 30,			December 31,			June 30, 2025
Description	2025			2024			Number		Maturity Date	Interest Rate
Notes receivable	$	156,386		$	128,588			7	Apr 2020 - Dec 2027	4.65% - 13.75%
Allowance for credit losses		(1,704	)		(2,004	)
Notes receivable, net	$	154,682		$	126,584			7

In April 2025, the Company modified a redeemable preferred equity investment in a property that is accounted for as a note receivable, with a principal balance of $54.0 million as of March 31, 2025. The maturity date was extended from February 25, 2025 to February 9, 2027, with an option for a one-year extension. As part of this modification, the borrower repaid $25.3 million of accrued interest. The Company also provided a mezzanine loan and additional advances under the preferred equity related to the same asset in the aggregate amount of $28.5 million, which also matures on February 9, 2027 and bears interest at a fixed rate of 9.00%. The borrower entity was determined to be a VIE in which the Company holds a variable interest, but is not the primary beneficiary. Accordingly the VIE is not consolidated (Note 15).

The following table presents the activity in the allowance for credit losses for the six months ended June 30, 2025 and year ended December 31, 2024 (in thousands):


	June 30,			December 31,
	2025			2024
Allowance for credit losses as of beginning of periods	$	2,004		$	1,279
Provision of loan losses		(300	)		725
Total credit allowance	$	1,704		$	2,004

As of June 30, 2025, the Company had six performing notes with a total amortized cost of $142.5 million, including accrued interest of $4.0 million. Each note was evaluated individually due to the lack of comparability across the Structured Financing portfolio.

One note receivable, totaling $21.6 million including accrued interest (exclusive of default interest and other amounts due on the loan that have not been recognized), was in default as of June 30, 2025 and December 31, 2024. The loan matured on April 1, 2020 and was not repaid. The Company expects to take appropriate actions to recover the amounts due under the loan and has issued a reservation of rights letter to the borrowers and guarantor, reserving all of its rights and remedies under the applicable note documents and otherwise. The Company applied the collateral-dependent practical expedient in accordance with ASC Topic 326: Financial Instruments - Credit Losses (“ASC 326”) as the note is expected to be settled through foreclosure or possession of the underlying collateral. Based on the estimated fair value of the collateral at the expected realization date, no allowance for credit losses was recorded.