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COMMERCIAL MORTGAGE LOANS
3 Months Ended
Mar. 31, 2014
Receivables [Abstract]  
COMMERCIAL MORTGAGE LOANS

NOTE 4. COMMERCIAL MORTGAGE LOANS

On January 31, 2014, the Company acquired a mezzanine loan secured by the borrower’s equity interest in an upper upscale hotel in Atlanta, Georgia, that was previously subject to the Company’s first commercial mortgage loan investment. The Company purchased the $5.0 million performing loan at par. The loan matures in February 2019 and bears a fixed interest rate of 12.00% per annum. Interest revenue recognized during the three months ended March 31, 2014 was approximately $100,000.

The Company’s commercial mortgage loan portfolio comprised the following at March 31, 2014:

 

Description

   Date of
Investment
     Maturity
Date
     Original Face
Amount
     Current Face
Amount
     Carrying
Value
     Coupon Rate  

Mezz – Hotel – Atlanta, GA

     January 2014         February 2019       $ 5,000,000      $ 5,000,000       $ 5,000,000        12.00
        

 

 

    

 

 

    

 

 

    

Total

         $ 5,000,000      $ 5,000,000       $ 5,000,000     
        

 

 

    

 

 

    

 

 

    

On August 7, 2013, the Company acquired a $19.6 million first mortgage loan secured by a hotel in Atlanta, Georgia, for approximately $17.5 million, a discount of approximately $2.05 million. The discount was being accreted into income ratably through the contractual maturity date in March 2014, which is included in Interest Income from Commercial Mortgage Loan in the consolidated financial statements. On January 6, 2014, the remaining commercial mortgage loan principal of $19.5 million was paid in full. The total revenue recognized during the three months ended March 31, 2014 was approximately $844,000 including the remaining accretion of the purchase discount of approximately $650,000, interest income of approximately $36,000, and an exit fee of approximately $195,000, offset by the remaining amortization of fees of approximately $37,000.

The Company’s commercial mortgage loan portfolio comprised the following at December 31, 2013:

 

Description

  

Date of
Investment

  

Maturity
Date

   Original Face
Amount
     Current Face
Amount
     Carrying
Value
     Coupon

Hotel – Atlanta, GA

   August 2013    March 2014    $ 19,560,000       $ 19,465,000       $ 18,845,053       30-day LIBOR

plus 4.50%

        

 

 

    

 

 

    

 

 

    

Total

         $ 19,560,000       $ 19,465,000       $ 18,845,053      
        

 

 

    

 

 

    

 

 

    

The carrying value of the commercial mortgage loan as of December 31, 2013 consisted of the following:

 

     Total  

Current Face Amount

   $ 19,465,000   

Unamortized Fees

     29,711   

Unaccreted Purchase Discount

     (649,658
  

 

 

 

Total

   $ 18,845,053