Investment Securities, at Fair Value

3 Months Ended

Mar. 31, 2014

Investments, Debt and Equity Securities [Abstract]

Investment Securities, at Fair Value

Note 8 — Investment Securities, at Fair Value

Investment securities are considered available-for-sale and, therefore, increases or decreases in the fair value of these investments are recorded in accumulated other comprehensive income (loss) as a component of equity on the consolidated balance sheets unless the securities are considered to be other than temporarily impaired at which time the losses are reclassified to expense.

The following tables detail the unrealized gains and losses on investment securities as of March 31, 2014 and December 31, 2013 (in thousands):

	March 31, 2014
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Investments in real estate fund	$	1,605	$	43	$	—		$	1,648
CMBS		209,076		3,546		(467	)		212,155
Total	$	210,681	$	3,589	$	(467	)	$	213,803
	December 31, 2013
	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses			Fair Value
Investments in real estate fund	$	1,589	$	—	$	(105	)	$	1,484
CMBS		60,452		498		(367	)		60,583
Total	$	62,041	$	498	$	(472	)	$	62,067

CMBS

In connection with the Cole Merger, the Company acquired 15 CMBS with an estimated aggregate fair value of $151.2 million as of the Cole Acquisition Date. As of March 31, 2014, the Company owned 25 CMBS with an estimated aggregate fair value of $212.2 million. As of March 31, 2014, certain of these securities were pledged as collateral under repurchase agreements (the “Repurchase Agreements”), as discussed in Note 13 — Other Debt. As of December 31, 2013, the Company owned 10 CMBS with an estimated aggregate fair value of $60.6 million.

As of March 31, 2014, the fair value of six CMBS were below their amortized cost. The Company evaluated each of the securities for other-than-temporary impairment at March 31, 2014, and determined that no other-than-temporary impairment charges on its securities were appropriate. The Company believes that none of the unrealized losses on investment securities are other-than-temporary because management expects the Company will receive all contractual principal and interest related to these investments. In addition, the Company did not have the intent to sell the securities or believe it would be required to sell them as of March 31, 2014.

The scheduled maturity of the Company’s CMBS as of March 31, 2014 is as follows (in thousands):

	March 31, 2014
	Amortized Cost		Fair Value
Due within one year	$	—	$	—
Due after one year through five years		1,325		1,348
Due after five years through 10 years		178,885		181,055
Due after 10 years		28,866		29,752
	$	209,076	$	212,155

Investment in Real Estate Fund

As of March 31, 2014, the Company had investments in a real estate fund that is sponsored by an affiliate of the Former Manager of the Company and which invests primarily in equity securities of other publicly traded REITs.