Mortgage and Other Notes Receivable

12 Months Ended

Dec. 31, 2013

Mortgage and Other Notes Receivable [Abstract]

Mortgage and Other Notes Receivable

MORTGAGE AND OTHER NOTES RECEIVABLE

Each of the Company's mortgage notes receivable is collateralized by either a first mortgage, a second mortgage or by an assignment of 100% of the partnership interests that own the real estate assets.  Other notes receivable include amounts due from tenants or government sponsored districts and unsecured notes received from third parties as whole or partial consideration for property or investments.  Interest rates on mortgage and other notes receivable range from 2.7% to 10.0%, with a weighted average interest rate of 6.47% and 7.33% at December 31, 2013 and 2012, respectively. Maturities of these notes receivable range from May 2014 to January 2047.

In the fourth quarter of 2013, the Company received a $7,430 promissory note in conjunction with the sale of a land parcel. The note receivable bears interest of 5.0% and fully amortizes through its maturity date in November 2023. See Note 14 for additional information.

In the second quarter of 2013, Mortgage Holdings, LLC, a subsidiary of the Company, entered into a $2,700 loan agreement with an affiliate of Horizon Group Properties, Inc. ("Horizon"), the Company's noncontrolling interest partner in The Outlet Shoppes at Atlanta. The note receivable bears interest of 7.0% through its maturity date in May 2015 and is secured by Horizon's interest in The Outlet Shoppes at Atlanta.

In the first quarter of 2013, Woodstock GA Investments, LLC, a joint venture in which the Company owns a 75.0%interest, received $3,525 of the balance on its $6,581 note receivable with an entity that owns an interest in land in Woodstock, GA, adjacent to the site of The Outlet Shoppes at Atlanta. The loan was made in the second quarter of 2012 and bears interest of 10.0% through its maturity date in May 2014. The loan is secured by the entity's interest in the adjacent land.

In the third quarter of 2011, the Company and a noncontrolling interest investor purchased a mezzanine loan with a face amount of $5,879 for $5,300, which represented a discount of $579. The borrower under the mezzanine loan was an entity that owned The Outlet Shoppes at Gettysburg, an outlet shopping center located in Gettysburg, PA. The loan bore interest at the greater of LIBOR plus 900 basis points or 10% and matured on February 2016. The terms of the mezzanine loan agreement provided that the Company and its noncontrolling interest investor could, subject to approval of the senior lender, convert the mezzanine loan into equity of the borrower. Upon conversion, the Company and noncontrolling investor would own 50.0% and 12.6%, respectively, of the borrower. The terms also provided that the Company could elect to acquire an additional 10% interest in the borrower for a total interest of 60%. In the second quarter of 2012, the Company and its noncontrolling interest partner exercised their rights under the terms of the agreement with the borrower and converted the mezzanine loan into a member interest in the outlet shopping center. See Note 3 for additional information.

In the fourth quarter of 2011, the Company entered into a loan agreement pursuant to which the Company loaned $9,150 to an entity that owned The Outlet Shoppes at El Paso, an outlet shopping center located in El Paso, TX. The note receivable bore interest of 13.0% through June 2013, and thereafter, at the greater of 13.0% or LIBOR plus 900 basis points. The loan matured upon the earlier of (i) 60 days prior to the maturity date of the senior loan on the outlet shopping center or (ii) the date on which the senior loan was fully repaid. The terms of the loan agreement provided that if the Company did not elect to acquire a 75% interest in the borrower, the Company could convert the loan into a non-voting common interest in the borrower, subject to the approval of the senior lender. In the second quarter of 2012, the Company acquired a 75.0% interest in the outlet shopping center and the borrower used a portion of the proceeds to repay the $9,150 mezzanine loan to the Company. See Note 3 for additional information.

The Company reviews its mortgage and other notes receivable to determine if the balances are realizable based on factors affecting the collectability of those balances.  Factors may include credit quality, timeliness of required periodic payments, past due status and management discussions with obligors. As of December 31, 2013, the Company believes that its mortgage and other notes receivable balance of $30,424 is fully collectable.