The Company currently originates and acquires first mortgage and mezzanine loans secured by commercial properties. These loans can potentially subject the Company to concentrations of credit risk as measured by various metrics, including the property type collateralizing the loan, loan size, loans to a single sponsor and loans in a single geographic area, among others. The Company’s loans held for investment are accounted for at amortized cost.

During the year ended December 31, 2018, the Company’s subsidiaries originated 26 loans with a total commitment of approximately $2.52 billion, an initial unpaid principal balance of $2.09 billion, and unfunded commitments upon closing of $436.2 million. During the year ended December 31, 2017, the Company originated 22 loans with a total commitment of approximately $1.95 billion, an initial unpaid principal balance of $1.61 billion, and unfunded commitments at closing of $331.2 million.

To fund these loan originations, the Company employed various financing methods, including secured revolving repurchase agreements, senior secured and secured credit agreements, collateralized loan obligations, asset-specific financings, a term loan facility, and the syndication of non-consolidated senior interests which are non-recourse to the Company and are recognized as sales. The Company did not have any non-consolidated senior interests outstanding as of December 31, 2018. Total commitments related to the syndication of non-consolidated senior interests for the year ended December 31, 2017 were $91.5 million.

The following tables present an overview of the loan investment portfolio as of December 31, 2018 and December 31, 2017 (dollars in thousands):

	December 31, 2018
Loans Receivable	Outstanding Principal		Unamortized Premium (Discount), Loan Origination Fees, net			Carrying Amount
Senior loans	$	4,313,591	$	(19,804	)	$	4,293,787
Subordinated and mezzanine loans		—		—			—
Subtotal before allowance		4,313,591		(19,804	)		4,293,787
Allowance for loan losses		—		—			—
Total	$	4,313,591	$	(19,804	)	$	4,293,787

	December 31, 2017
Loans Receivable	Outstanding Principal		Unamortized Premium (Discount), Loan Origination Fees, net			Carrying Amount
Senior loans	$	3,122,670	$	(22,143	)	$	3,100,527
Subordinated and mezzanine loans		75,446		(301	)		75,145
Subtotal before allowance		3,198,116		(22,444	)		3,175,672
Allowance for loan losses		—		—			—
Total	$	3,198,116	$	(22,444	)	$	3,175,672

For the year ended December 31, 2018, loan portfolio activity was as follows (dollars in thousands):

Balance at December 31, 2017	$	3,175,672
Additions during the period:
Loans originated		2,071,391
Additional fundings		258,308
Amortization of discount and origination fees		16,907
Deductions during the period:
Collection of principal		(1,228,491	)
Balance at December 31, 2018	$	4,293,787

At December 31, 2018 and December 31, 2017, there was $0.0 million and $2.0 million, respectively, of unamortized discount included in loans held for investment at amortized cost on the consolidated balance sheets.

On July 16, 2018, the Company sold its participation interest in a non-core, fixed rate performing loan purchased in December 2014 to a third party for total cash consideration of $2.6 million, including sale costs and fees, recognizing a loss on sale of $0.4 million which is recorded in Other Income, net.

The table below summarizes the carrying values and results of the Company’s internal risk rating review performed as of December 31, 2018 and December 31, 2017 (dollars in thousands):

	Carrying Value
Rating	December 31, 2018		December 31, 2017
1	$	29,923	$	—
2		959,314		1,318,816
3		3,099,401		1,680,913
4		205,149		175,943
5		—		—
Totals	$	4,293,787	$	3,175,672
Weighted Average Risk Rating⁽¹⁾		2.8		2.6

The weighted average risk rating at December 31, 2018 and December 31, 2017 was 2.8 and 2.6, respectively. During the three months ended December 31, 2018, one loan was moved from the Company’s Category 3 risk rating into its Category 2 risk rating, resulting from asset-level occupancy increases that have exceeded the Company’s underwriting. The Company also moved two loans from its Category 2 risk rating into its Category 3 risk rating as a result of recent decreases in the operating performance of the underlying collateral.

At December 31, 2018 and December 31, 2017, there were no loans on non-accrual status or that were impaired; thus, the Company did not record any allowance for loan losses.