XML 42 R27.htm IDEA: XBRL DOCUMENT v3.5.0.2
Transactions with Related Parties
9 Months Ended
Sep. 30, 2016
Transactions With Related Parties [Abstract]  
Related Party Transactions Disclosure [Text Block]

19. Transactions with Related Parties

The general partner of the Partnership, AFCA 2, is entitled to receive an administrative fee from the Partnership equal to 0.45% per annum of the outstanding principal balance of any of its mortgage revenue bonds, property loans collateralized by real property, and other investments for which the owner of the financed property or other third party is not obligated to pay such administrative fee directly to AFCA 2.  For the three and nine months ended September 30, 2016 the Partnership paid or accrued administrative fees to AFCA 2 of approximately $682,000 and $2.0 million, respectively. For the three and nine months ended September 30, 2015, the Partnership paid or accrued administrative fees to AFCA 2 of approximately $669,000 and $1.9 million, respectively. In addition to the administrative fees paid directly by the Partnership, AFCA 2 receives administrative fees directly from the owners of properties financed by certain of the mortgage revenue bonds held by the Partnership.  These administrative fees also equal 0.45% per annum of the outstanding principal balance of these mortgage revenue bonds and totaled approximately $16,000 and $46,000 for the three and nine months ended September 30, 2015, respectively. There were no such administrative fees received for the nine months ended September 30, 2016 as the properties financed by these mortgage revenue bonds were sold in 2015.

AFCA 2 earns mortgage placement fees in connection with the acquisition of certain mortgage revenue bonds and investments in unconsolidated entities and select notes receivable.  These mortgage placement fees were paid by the owners of the respective properties and, accordingly, have not been reflected in the accompanying condensed consolidated financial statements because these properties are not considered consolidated VIEs or related parties.  During the three and nine months ended September 30, 2016, AFCA 2 earned mortgage placement fees of approximately $687,000 and $1.2 million, respectively. In addition, AFCA 2 received a one-time $125,000 negotiated mortgage placement fee related to work performed for a transaction that did not materialize during the second quarter of 2016.  During the three and nine months ended September 30, 2015, AFCA 2 earned mortgage placement fees of approximately $259,000 and $1.0 million, respectively.  

An affiliate of AFCA 2, Burlington Capital Properties, LLC (f/k/a America First Properties Management Company, LLC) (“Properties Management”) provided property management services for seven of the MF Properties (including the Arboretum and Woodland Park that were sold in the second and third quarters of 2016, respectively) and seven of the properties collateralized by the mortgage revenue bonds, earning management fees of approximately $246,000 and $856,000 for the three and nine months ended September 30, 2016, respectively.  Properties Management provided property management services for nine MF Properties (including The Colonial and Glynn Place that were sold in the second and third quarters of 2015, respectively), the two Consolidated VIEs reported as discontinued operations, and six properties collateralized by mortgage revenue bonds, earning management fees of approximately $309,000 and $952,000 for the three and nine months ended September 30, 2015, respectively. For the properties collateralized by the mortgage revenue bonds, these property management fees are not Partnership expenses, but are paid in each case by the owner of the Residential Properties.  For MF Properties, the property management fees are reflected as real estate operating expenses on the Partnership’s condensed consolidated financial statements.  The property management fees are paid out of the revenues generated by the respective property prior to the payment of debt service on the Partnership's mortgage revenue bonds and property loans, if applicable.

An affiliate of AFCA 2, Farnam Capital Advisors, LLC, acts as an origination advisor and consultant to the borrowers when mortgage revenue bonds, investments in unconsolidated entities, select notes receivable, and financing facilities are acquired by the Partnership. For the three and nine months ended September 30, 2016, approximately $343,000 and $537,000, respectively, in origination fees were paid by the borrower of certain acquired mortgage revenue bonds and equity investments and have not been reflected in the accompanying condensed consolidated financial statements. During the three months ended September 30, 2016, approximately $1.2 million in consulting fees were paid by the Partnership to this affiliate for services related to establishment of Term A/B Trusts. In addition, Farnam Capital Advisors, LLC received a $125,000 origination fee for work performed related to a transaction that did not materialize during the second quarter of 2016.   For the three and nine months ended September 30, 2015, approximately $129,000 and $507,000, respectively, in origination fees were paid by the borrower of certain acquired bonds and have not been reflected in the accompanying condensed consolidated financial statements. During the three months ended September 30, 2015, approximately $790,000 in consulting fees were paid by the Partnership to this affiliate related to the M33 TEBS financing facility.