SEGMENT REPORTING

6 Months Ended

Jun. 30, 2016

Segment Reporting [Abstract]

SEGMENT REPORTING

NOTE 14: SEGMENT REPORTING

As a group, our executive officers act as the Chief Operating Decision Maker (“CODM”). The CODM reviews operating results of our reportable segments to make decisions about investments and resources and to assess performance for each of these reportable segments. We conduct our business through the following reportable segments:

· Our real estate lending, owning and managing segment concentrates on lending, owning and managing commercial real estate assets throughout the United States. The form of our investment may range from first mortgage loans to equity ownership of a commercial real estate property. We manage our investments internally through our asset management and property management professionals.

· Our IRT segment concentrates on the ownership of apartment properties in opportunistic markets throughout the United States. As of June 30, 2016, IRT owns $1,314,115 in gross real estate investments, before accumulated depreciation.

	Real Estate Lending Owning and Management			IRT		Eliminations (a)			Consolidated
Three Months Ended June 30, 2016:
Net interest margin	$	14,490		$	—	$	(96	)	$	14,394
Property income		29,571			38,327		—			67,898
Fee and other income		9,834			—		(7,059	)		2,775
Provision for losses		1,344			—		—			1,344
Depreciation and amortization expense		15,171			7,635		—			22,806
Operating income		(7,686	)		2,027		—			(5,659	)
Change in fair value of financial instruments		(1,592	)		—		—			(1,592	)
Income tax benefit (provision)		1,756			—		—			1,756
Net income (loss)		64			30,790		(4,449	)		26,405
Three Months Ended June 30, 2015:
Net interest margin	$	16,766		$	—	$	(241	)	$	16,525
Property income		32,816			22,718		—			55,534
Fee and other income		12,049			—		(4,420	)		7,629
Provision for losses		2,000			—		—			2,000
Depreciation and amortization expense		11,287			5,720		—			17,007
Operating income		1,406			353		1			1,760
Change in fair value of financial instruments		8,356			—		—			8,356
Income tax benefit (provision)		(715	)		—		—			(715	)
Net income (loss)		27,396			353		(1,308	)		26,441

(a) The transactions that occur between the reportable segments include advisory and property management services, as well as providing commercial mortgages on our owned real estate.

	Real Estate Lending Owning and Management			IRT			Eliminations (a)			Consolidated
Six Months Ended June 30, 2016:
Net interest margin	$	31,237		$	-		$	(361	)	$	30,876
Property income		59,627			76,993			—			136,620
Fee and other income		19,559			—			(13,932	)		5,627
Provision for losses		2,669			—			—			2,669
Depreciation and amortization expense		27,920			19,162			—			47,082
Operating income		(11,336	)		(563	)		—			(11,899	)
Change in fair value of financial instruments		(5,680	)		—			—			(5,680	)
Income tax benefit (provision)		2,749			—			—			2,749
Net income (loss)		(10,405	)		30,744			(4,437	)		15,902
Six Months Ended  June 30, 2015:
Net interest margin	$	33,338		$	-		$	(479	)	$	32,859
Property income		64,433			44,375			—			108,808
Fee and other income		21,839			—			(8,616	)		13,223
Provision for losses		4,000			—			—			4,000
Depreciation and amortization expense		24,273			11,758			—			36,031
Operating income		(1,598	)		111			—			(1,487	)
Change in fair value of financial instruments		12,846			—			—			12,846
Income tax benefit (provision)		(1,297	)		—			—			(1,297	)
Net income (loss)		29,213			112			(2,618	)		26,707

(a) The transactions that occur between the reportable segments include advisory and property management services, as well as providing commercial mortgages on our owned real estate.