COMMERCIAL REAL ESTATE INVESTMENTS

12 Months Ended

Dec. 31, 2013

COMMERCIAL REAL ESTATE INVESTMENTS

6.       COMMERCIAL REAL ESTATE INVESTMENTS

At December 31, 2013, commercial real estate investments were composed of the following:

CRE Debt and Preferred Equity Investments

	December 31, 2013
	Outstanding Principal		Carrying Value			Percentage of Loan Portfolio(1)
	(dollars in thousands)
Senior mortgages	$	669,512	$	669,949			42.2	%
Subordinate notes		41,059		41,408			2.6	%
Mezzanine loans		626,883		628,357			39.5	%
Preferred equity		249,769		249,145			15.7	%
Subtotal	$	1,587,223	$	1,588,859			100	%
Net origination fees				(4,890	)
Net investment in CRE Debt and Preferred  Equity Investments			$	1,583,969

(1) Based on outstanding principal

	December 31, 2013
	Senior Mortgages			Subordinate Notes			Mezzanine Loans			Preferred Equity			Total
	(dollars in thousands)
Beginning principal balance, net of loss reserves	$	100,907		$	41,293		$	545,109		$	39,769		$	727,078
Purchases/advances (principal)		594,143			-			184,704			210,000			988,847
Sales (principal)		(13,750	)		-			-			-			(13,750	)
Remaining premium (discount)		458			350			1,476			(624	)		1,660
Principal payments		(24,309	)		(235	)		(90,432	)		-			(114,976	)
Transfers		12,500			-			(12,500	)		-			-
Allowance for loan losses		-			-			-			-			-
Net carrying value (excluding origination fees)	$	669,949		$	41,408		$	628,357		$	249,145		$	1,588,859

Internal CRE Debt and Preferred Equity Investment Ratings

	December 31, 2013
			Percentage of CRE Debt and			Internal Ratings
Investment Type	Outstanding Principal		Preferred Equity Portfolio			Performing Loans		Watch List Loans		Workout Loans
	(dollars in thousands)
Senior mortgages	$	669,512		42.2	%	$	644,039	$	25,473	$	-
Subordinate notes		41,059		2.6	%		41,059		-		-
Mezzanine loans		626,883		39.5	%		620,883		6,000		-
Preferred equity		249,769		15.7	%		249,769		-		-
	$	1,587,223		100.00	%	$	1,555,750	$	31,473	$	-

Total Commercial Real Estate Investment

	December 31, 2013
	(dollars in thousands)
Real estate held for investment, at amortized cost
Land	$	6,639
Buildings and improvements		31,100
Subtotal		37,739
Less: accumulated depreciation		(877	)
Total real estate held for investment at amortized cost, net		36,862
Real estate held for sale at fair value		23,270
Total investment in commercial real estate, net		60,132
Net carrying value of CRE Debt and Preferred  Equity Investments		1,583,969
Total commercial real estate investments	$	1,644,101