Transactions with Related Parties

6 Months Ended

Jun. 30, 2014

Related Party Transactions [Abstract]

Transactions with Related Parties

13. TRANSACTIONS WITH RELATED PARTIES

As of June 30, 2014, our consolidated balance sheet included $4.4 million of accrued management fees and $25,000 of expense reimbursements payable to our Manager. During the six months ended June 30, 2014, we paid $5.9 million of management fees to our Manager and reimbursed our Manager for $90,000 of expenses incurred on our behalf. In addition, as of June 30, 2014, our consolidated balance sheet included $191,000 of preferred distributions payable by CT Legacy Partners to an affiliate of our Manager. During the six months ended June 30, 2014, CT Legacy Partners made aggregate preferred distributions of $1.2 million to such affiliate.

On October 3, 2013, we issued 339,431 shares of restricted class A common stock with a grant date fair value of $8.5 million to our Manager under the 2013 Manager Plan. The shares of restricted class A common stock vest ratably in quarterly installments over three years from the date of issuance. We recorded a non-cash expense related to these shares of $1.7 million during the six months ended June 30, 2014. Refer to Note 11 for further discussion of our restricted class A common stock.

During the six months ended June 30, 2014, CT CDO I, which is consolidated by us, paid $139,000 of special servicing fees to an affiliate of our Manager.

There may be conflicts between us and our Manager with respect to certain of the investments in the CT Legacy Partners and CTOPI portfolios where an affiliate of our Manager holds a related investment that is senior, junior, or pari passu to the investments held by these portfolios. In addition, the Management Agreement with our Manager excludes from the management fee calculation our interests in CT Legacy Partners, CTOPI, and CT CDO I, which may result in further conflicts between our economic interests and those of our Manager. Refer to Note 9 for further discussion of the Management Agreement with our Manager.

On June 20, 2014, CT CDO I, CT Legacy Partners, CTOPI, and other affiliates of our Manager entered into a deed-in-lieu of foreclosure transaction which resulted in a restructuring of the interests held by each entity with respect to certain loans in our CT Legacy Portfolio segment with an aggregate principal balance of $35.0 million and an aggregate book value of $27.0 million.