Real Estate Loans Receivable

12 Months Ended

Dec. 31, 2010

Real Estate Loans Receivable [Abstract]

6. Real Estate Loans Receivable

The following is a summary of our real estate loans receivable (in thousands):


	December 31,
	2010		2009
Mortgage loans	$	109,283	$	74,517
Other real estate loans		327,297		352,846

Totals	$	436,580	$	427,363

The following is a summary of our real estate loan activity for the periods presented (in thousands):


	Year Ended
	December 31, 2010								December 31, 2009									December 31, 2008
	Senior								Senior									Senior
	Housing		Medical						Housing			Medical						Housing			Medical
	and Care⁽¹⁾		Facilities			Totals			and Care⁽¹⁾			Facilities			Totals			and Care⁽¹⁾			Facilities		Totals
Advances on real estate loans receivable:
Investments in new loans	$	9,742	$	41,644		$	51,386		$	20,036		$	—		$	20,036		$	121,493		$	—	$	121,493
Draws on existing loans		46,113		1,236			47,349			52,910			1,471			54,381			21,265			—		21,265

Sub-total		55,855		42,880			98,735			72,946			1,471			74,417			142,758			—		142,758
Less: Seller financing on property sales		—		(1,470	)		(1,470	)		—			—			—			(59,649	)		—		(59,649	)

Net cash advances on real estate loans		55,855		41,410			97,265			72,946			1,471			74,417			83,109			—		83,109
Receipts on real estate loans receivable:
Loan payoffs		5,619		6,233			11,852			61,659			32,197			93,856			8,815			—		8,815
Principal payments on loans		24,203		7,440			31,643			15,890			2,033			17,923			9,354			—		9,354

Total receipts on real estate loans		29,822		13,673			43,495			77,549			34,230			111,779			18,169			—		18,169

Net advances (receipts) on real estate loans	$	26,033	$	27,737		$	53,770		$	(4,603	)	$	(32,759	)	$	(37,362	)	$	64,940		$	—	$	64,940


(1)		Represents activity for the senior housing triple-net segment.

The following is a summary of the allowance for losses on loans receivable for the periods presented (in thousands):


	Year Ended December 31,
	2010			2009			2008
Balance at beginning of year	$	5,183		$	7,500		$	7,406
Provision for loan losses		29,684			23,261			94
Charge-offs		(33,591	)		(25,578	)		—

Balance at end of year	$	1,276		$	5,183		$	7,500

As a result of our quarterly evaluations, we recorded $29,684,000 of provision for loan losses during the year ended December 31, 2010. This amount includes the write-off of loans totaling $33,591,000 primarily related to certain early stage senior housing and CCRC development projects. These related to three separate borrowers where new factors arose that, under the circumstances, resulted in the determination to record the write-offs. This was offset by a net reduction of the allowance balance by $3,907,000, resulting in an allowance for loan losses of $1,276,000 relating to real estate loans with outstanding balances of $9,691,000, all of which were on non-accrual status at December 31, 2010.

During the quarter ended September 30, 2010, we received title to a parcel of land and an equity interest in satisfaction of certain loans outstanding with a combined balance of $38,848,000. For balance sheet purposes, the land parcel is recorded as land and the equity interest is accounted for as an equity method investment (in our senior housing triple-net segment), the amounts of which were recorded at their estimated fair values at the transaction dates. The equity interest is in an entity deemed to be a VIE, however, we have determined that we are not the primary beneficiary as we do not have the ability to direct and influence the activities that most significantly impact the entity’s economic performance. Our exposure to loss is limited to the recorded equity investment balance of $29,578,000.

The following is a summary of our loan impairments (in thousands):


	Year Ended December 31,
	2010		2009		2008
Balance of impaired loans at end of year	$	9,691	$	67,126	$	72,770
Allowance for loan losses		1,276		5,183		7,500

Balance of impaired loans not reserved	$	8,415	$	61,943	$	65,270

Average impaired loans for the year	$	38,409	$	69,948	$	36,785
Interest recognized on impaired loans⁽¹⁾		103		530		3,288


(1)		Represents interest recognized prior to placement on non-accrual status.