Other Assets

6 Months Ended

Jun. 30, 2021

Other Assets

Other Assets

9. Other Assets

Other assets consist of the following:

	June 30,		December 31,
	2021		2020
Restricted investments	$	—	$	1,171
Investments - equity securities		339		2,623
Accounts receivable, net		13,354		10,791
Homesite sales receivable		7,175		5,675
Notes receivable, net		15,585		10,877
Inventory		2,520		2,026
Prepaid expenses		7,581		7,135
Straight-line rent		2,702		3,174
Operating lease right-of-use assets		863		808
Other assets		6,613		5,743
Retained interest investments		13,331		12,905
Accrued interest receivable for Senior Notes held by SPE		2,938		2,938
Total other assets	$	73,001	$	65,866

Restricted Investments

As of December 31, 2020, the Company’s restricted investments were related to the Company’s deferred compensation plan. As part of the Pension Plan termination in 2014, the Company directed the Pension Plan to transfer the Pension Plan’s surplus assets into a suspense account in the Company’s 401(k) plan. The Company retained the risks and rewards of ownership of these assets; therefore, the assets held in the suspense account were included in the Company’s condensed consolidated balance sheets until they were allocated to 401(k) plan participants. The final

allocation of the assets occurred in March 2021. During both the six months ended June 30, 2021 and 2020, the Company recorded an expense of $1.2 million for the fair value of the assets, less expenses, that were allocated to participants. Refer to Note 6. Financial Instruments and Fair Value Measurements.

Investments - Equity Securities

As of June 30, 2021 and December 31, 2020, investments - equity securities included $0.3 million and $2.6 million, respectively, of preferred stock investments recorded at fair value. During the three and six months ended June 30, 2021, the Company recognized $0.5 million and $1.1 million, respectively, of unrealized loss on investments related to equity securities still held as of June 30, 2021. During the three and six months ended June 30, 2020, the Company recognized less than $0.1 million and $4.8 million, respectively, of unrealized loss on investments related to equity securities still held as of June 30, 2020. These amounts were included within investment income, net on the condensed consolidated statements of income.

Accounts Receivable, Net

The Company’s accounts receivable, net primarily include receivables related to certain homesite sales, leasing receivables, membership initiation fees, hospitality receivables and other receivables. At each reporting period, accounts receivable in the scope of Topic 326 are pooled by type and judgements are made based on historical losses and expected credit losses based on economic trends to determine the allowance for credit losses primarily using the aging method. Actual losses could differ from those estimates. Write-offs are recorded when the Company concludes that all or a portion of the receivable is no longer collectible and recoveries on receivables previously charged-off are credited to the allowance. As of both June 30, 2021 and December 31, 2020, accounts receivable were presented net of allowance for credit losses of $0.2 million and net of allowance for lease related receivables of $0.1 million. During the six months ended June 30, 2021, allowance for credit losses related to accounts receivable, net increased less than $0.1 million.

Homesite Sales Receivable

Homesite sales receivable from contracts with customers include estimated homesite residuals and certain estimated fees that are recognized as revenue at the time of sale to homebuilders, subject to constraints. Any change in circumstances from the estimated amounts will be updated at each reporting period. The receivable will be collected as the homebuilders build the homes and sell to retail consumers, which can occur over multiple years.

The following table presents the changes in homesite sales receivable:

				Increases Due To		Decreases Due to
		Balance		Revenue Recognized		Amounts		Balance
		January 1, 2021		for Homesites Sold		Received/Transferred		June 30, 2021
Homesite sales receivable	$	5,675	$	3,462	$	(1,962)	$	7,175

				Increases Due To		Decreases Due to
		Balance		Revenue Recognized		Amounts		Balance
		January 1, 2020		for Homesites Sold		Received/Transferred		June 30, 2020
Homesite sales receivable	$	5,211	$	1,075	$	(1,367)	$	4,919

Notes Receivable, Net

Notes receivable, net consists of the following:

	June 30,		December 31,
	2021		2020
Interest bearing revolving promissory note with the unconsolidated Latitude Margaritaville Watersound JV, secured by the JV's real property — bearing interest at a rate of 5.0%, matures June 2025	$	7,565	$	2,714
Various interest bearing homebuilder notes, secured by the real estate sold — bearing interest at a rate of 5.5%, due June 2021 through May 2023		7,336		7,544
Interest bearing notes with JV partners, secured by the partner's membership interest in the JV — bearing interest at a rate of 8.0%, due May 2039 through July 2039		551		556
Non-interest bearing note with a tenant for tenant improvements, due October 2025		80		—
Various mortgage notes, secured by certain real estate, bearing interest at rates of 5.2% to 6.7%, due December 2022 through November 2023		53		63
Total notes receivable, net	$	15,585	$	10,877

In June 2020, the Company entered into a $10.0 million secured revolving promissory note (the “Latitude Margaritaville Watersound JV Note”) with the unconsolidated Latitude Margaritaville Watersound JV. The Latitude Margaritaville Watersound JV Note was provided to finance the development of the pod-level, non-spine infrastructure, which will be repaid by the JV as each home is sold by the JV, with the aggregate unpaid principal and all accrued and unpaid interest due at maturity in June 2025. The Latitude Margaritaville Watersound JV Note is secured by a mortgage and security interest in and on the real property and improvements located on the real property of the JV. See Note 4. Joint Ventures for additional information.

The Company may allow homebuilders to pay for homesites during the home construction period in the form of homebuilder notes. The Company evaluates the carrying value of all notes receivable and the need for an allowance for credit losses at each reporting date. As of both June 30, 2021 and December 31, 2020, notes receivable were presented net of allowance for credit losses of $0.1 million. As of June 30, 2021 and December 31, 2020, accrued interest receivable was $0.4 million and $0.2 million, respectively, and is included within other assets on the condensed consolidated balance sheets.

Retained Interest Investments

The Company has a beneficial interest in certain bankruptcy-remote qualified SPEs used in the installment sale monetization of certain sales of timberlands in 2007 and 2008. The SPEs’ assets are not available to satisfy the Company’s liabilities or obligations and the liabilities of the SPEs are not the Company’s liabilities or obligations. Therefore, the SPEs’ assets and liabilities are not consolidated in the Company’s condensed consolidated financial statements as of June 30, 2021 and December 31, 2020. The Company’s continuing involvement with the SPEs is the receipt of the net interest payments and the remaining principal of approximately $16.5 million to be received at the end of the installment notes’ fifteen year maturity period, in 2022 through 2024. The Company has a beneficial or retained interest investment related to these SPEs of $13.3 million and $12.9 million as of June 30, 2021 and December 31, 2020, respectively, recorded in other assets on the Company’s condensed consolidated balance sheets.