Variable Interest Entities (Tables)

12 Months Ended

Dec. 31, 2013

Assets and Liabilities of Consolidated Variable Interest Entities

The following table presents the assets and liabilities of our consolidated VIEs as of each respective date.


	As of December 31, 2013			As of December 31, 2012
Assets
Investments in mortgages and loans, at amortized cost:
Commercial mortgages, mezzanine loans, other loans and preferred equity interests	$	1,816,507		$	1,917,925
Allowance for losses		(17,250	)		(17,125	)

Total investments in mortgages and loans		1,799,257			1,900,800
Investments in real estate, net of accumulated depreciation of $18,538 and 1,941, respectively		194,648			20,609
Investments in securities and security-related receivables, at fair value		566,577			654,795
Cash and cash equivalents		3,599			276
Restricted cash		40,793			50,203
Accrued interest receivable		68,456			67,271
Deferred financing costs, net of accumulated amortization of $17,107 and $13,633, respectively		10,263			12,741
Intangible assets, net of accumulated amortization of $568 and $0, respectively		517			0

Total assets	$	2,684,110		$	2,706,695

Liabilities and Equity
Indebtedness (including $377,235 and $187,048 at fair value, respectively)	$	1,946,536		$	1,724,356
Accrued interest payable		73,122			59,914
Accounts payable and accrued expenses		5,771			3,335
Derivative liabilities		113,323			151,438
Deferred taxes, borrowers’ escrows and other liabilities		5,805			4,877

Total liabilities		2,144,557			1,943,920
Equity:
Shareholders’ equity:
Accumulated other comprehensive income (loss)		(59,684	)		(90,954	)
RAIT investment		262,760			295,641
Retained earnings (deficit)		258,270			558,088

Total shareholders’ equity		461,346			762,775
Noncontrolling interests		78,207			0

Total liabilities and equity	$	2,684,110		$	2,706,695

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

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