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NOTES AND INTEREST RECEIVABLE
 3 Months Ended
Mar. 31, 2020
Receivables [Abstract]  
NOTES AND INTEREST RECEIVABLE

NOTE 5.               NOTES AND INTEREST RECEIVABLE

 

A portion of our assets are invested in mortgage notes receivable, principally secured by real estate. We may originate mortgage loans in conjunction with providing purchase money financing of property sales. Notes receivable are generally collateralized by real estate or interests in real estate and guarantees, unless noted otherwise, are so secured. Management intends to service and hold for investment the mortgage notes in our portfolio. A majority of the notes receivable provide for principal to be paid at maturity.

 

Below is a summary of our notes receivable as of March 31, 2020 (dollars in thousands):

 

 

 

 

 

 

Maturity

 

 

Interest

 

 

 

 

 

 

Borrower

 

 

 

 

Date

 

 

Rate

 

 

Amount

 

Security

 

Performing loans:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Prospectus Endeavors 4, LLC

 

 

 

 

01/23

 

 

12.00

%

 

 

5,907

 

 

Secured

 

Prospectus Endeavors 6, LLC

 

 

 

 

10/22

 

 

12.00

%

 

 

496

 

 

Secured

 

Oulan-Chikh Family Trust

 

 

 

 

03/21

 

 

8.00

%

 

 

174

 

 

Secured

 

H198, LLC (McKinney Ranch Land)

 

 

 

 

09/20

 

 

6.00

%

 

 

4,554

 

 

Secured

 

Forest Pines Phase I

 

 

 

 

11/20

 

 

5.00

%

 

 

2,869

 

 

Secured

 

Spyglass Apartments of Ennis, LP

 

 

 

 

11/20

 

 

5.00

%

 

 

5,335

 

 

Secured

 

Bellwether Ridge

 

 

 

 

05/20

 

 

5.00

%

 

 

3,853

 

 

Secured

 

Parc at Windmill Farms

 

 

 

 

05/20

 

 

5.00

%

 

 

7,697

 

 

Secured

 

Autumn Breeze

 

 

 

 

10/21

 

 

5.00

%

 

 

1,414

 

 

Secured

 

Plum Tree

 

 

 

 

10/21

 

 

5.00

%

 

 

492

 

 

Secured

 

Parc at Ingleside

 

 

 

 

12/21

 

 

5.00

%

 

 

1,827

 

 

Secured

 

RNC Revolving Line of Credit

 

 

 

 

09/24

 

 

5.00

%

 

 

8,851

 

 

Secured

 

Steeple Crest

 

 

 

 

10/20

 

 

5.00

%

 

 

6,665

 

 

Secured

 

RAI PFBL 2018 Purch Fee Note Weatherford

 

 

 

 

12/21

 

 

12.00

%

 

 

525

 

 

Secured

 

Unified Housing Foundation, Inc. (Echo Station) (1)

 

 

 

 

12/32

 

 

12.00

%

 

 

1,481

 

 

Secured

 

Unified Housing Foundation, Inc. (Lakeshore Villas) (1)

 

 

 

 

12/32

 

 

12.00

%

 

 

2,000

 

 

Secured

 

Unified Housing Foundation, Inc. (Lakeshore Villas) (1)

 

 

 

 

12/32

 

 

12.00

%

 

 

6,369

 

 

Secured

 

Unified Housing Foundation, Inc. (Limestone Ranch) (1)

 

 

 

 

12/32

 

 

12.00

%

 

 

1,953

 

 

Secured

 

Unified Housing Foundation, Inc. (Limestone Ranch) (1)

 

 

 

 

12/32

 

 

12.00

%

 

 

2,000

 

 

Secured

 

Unified Housing Foundation, Inc. (Limestone Ranch) (1)

 

 

 

 

12/32

 

 

12.00

%

 

 

4,000

 

 

Secured

 

Unified Housing Foundation, Inc. (Timbers of Terrell) (1)

 

 

 

 

12/32

 

 

12.00

%

 

 

1,323

 

 

Secured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

12/21

 

 

12.00

%

 

 

10,401

 

 

Unsecured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

06/20

 

 

12.00

%

 

 

5,314

 

 

Unsecured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

03/22

 

 

12.00

%

 

 

4,782

 

 

Unsecured

 

Unified Housing Foundation, Inc. (Lakeshore Villas) (1)

 

 

 

 

07/21

 

 

12.00

%

 

 

838

 

 

Secured

 

Unified Housing Foundation, Inc. (Limestone Ranch) (1)

 

 

 

 

07/21

 

 

12.00

%

 

 

773

 

 

Secured

 

Unified Housing Foundation, Inc. (Marquis at Vista Ridge) (1)

 

 

 

 

07/21

 

 

12.00

%

 

 

839

 

 

Secured

 

Unified Housing Foundation, Inc. (Timbers at the Park) (1)

 

 

 

 

07/21

 

 

12.00

%

 

 

432

 

 

Secured

 

Unified Housing Foundation, Inc. (Bella Vista) (1)

 

 

 

 

08/21

 

 

12.00

%

 

 

212

 

 

Secured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

03/23

 

 

12.00

%

 

 

61

 

 

Unsecured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

03/23

 

 

12.00

%

 

 

1,482

 

 

Unsecured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

03/23

 

 

12.00

%

 

 

4,792

 

 

Unsecured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

03/23

 

 

12.00

%

 

 

716

 

 

Unsecured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

03/23

 

 

12.00

%

 

 

317

 

 

Unsecured

 

Unified Housing Foundation, Inc. (1)

 

 

 

 

10/21

 

 

12.00

%

 

 

6,831

 

 

Unsecured

 

Other related party notes

 

 

 

 

Various

 

 

Various

 

 

 

1,825

 

 

Various secured interests

 

Other non-related party notes

 

 

 

 

Various

 

 

Various

 

 

 

11,691

 

 

Various secured interests

 

Accrued interest

 

 

 

 

 

 

 

 

 

 

 

7,604

 

 

 

 

Total Performing

 

 

 

 

 

 

 

 

 

 

$

128,695

 

 

 

 

                                 

Allowance for estimated losses

 

 

 

 

 

 

 

 

 

 

 

(1,825

)

 

 

 

Total

 

 

 

 

 

 

 

 

 

 

$

126,870

 

 

 

 

 

(1) Related party notes

 

We invest in mortgage loans, secured by mortgages that are subordinate to one or more prior liens either on the fee or a leasehold interest in real estate. Recourse on such loans ordinarily includes the real estate on which the loan is made, other collateral and guarantees.

 

At March 31, 2020, we had mortgage loans and accrued interest receivable from related parties, net of allowances, totaling $60.5 million and recognized interest income of $4.1 million related to these notes receivables. During the quarter just ended, the Company collected $1.2 million and purchased from a related party $7.4 million of notes receivables with an interest rate of 12% and maturity date of March 2023.

 

The Company has various notes receivable from Unified Housing foundation, Inc. (“UHF”). UHF is determined to be a related party due to our significant investment in the performance of the collateral secured under the notes receivable. Payments are due from surplus cash flow from operations, sale or refinancing of the underlying properties. These notes are cross collateralized to the extent that any surplus cash available from any of the properties underlying these notes will be used to repay outstanding interest and principal for the remaining notes. Furthermore, any surplus cash available from any of the properties UHF owns, besides the properties underlying these notes, can be used to repay outstanding interest and principal for these notes. The allowance on the notes was a purchase allowance that was netted against the notes when acquired.