Investment in Unconsolidated Joint Ventures (Tables)

6 Months Ended

Jun. 30, 2018

Investment in Unconsolidated Joint Ventures

Summary of investments in unconsolidated joint ventures

The following table summarizes our investment in unconsolidated joint ventures (dollar amounts in thousands):

	Type	Type		Total		Currently		Number
	of	of		Preferred		Paid in		of		Investment			Carrying
State	Properties	Investment		Return		Cash		Beds/ Units		Commitment			Value
Arizona	ALF/MC/ILF	Preferred Equity	(1)	15	%	7	%	585	$	25,650		$	23,859
Florida	ALF/IL/MC	Mezzanine	(2)	15	%	12	%	99		2,900	(3)		3,138	(3)
Florida	UDP-ALF/MC	Mezzanine	(2)	15	%	10	%	127		3,400			3,400
Total								811	$	31,950		$	30,397

⁽¹⁾ We have concluded that the JV is a variable interest entity (“VIE”) in accordance with GAAP. However, because we do not control the entity, nor do we have any role in the day-to-day management, we are not the primary beneficiary of the JV. Therefore, we account for the JV investment using the equity method.

⁽²⁾ We evaluated these acquisition, development and construction (“ADC”) arrangements and determined that the characteristics are similar to jointly-owned investments or partnerships, and accordingly, these investments are accounted for as unconsolidated joint ventures under the equity method of accounting instead of loan accounting.

⁽³⁾ Since interest payments were deferred and no interest was recorded for the first twelve months of the loan, we used the effective interest method in accordance with GAAP to recognize interest income and recorded the difference between the effective interest income and cash interest income to the loan principal balance.

Summary of capital contributions, income recognized and cash interest received from investments in unconsolidated joint ventures

The following table summarizes our capital contributions, income recognized, and cash interest received related to our investments in unconsolidated joint ventures (in thousands):

	Six Months Ended June 30,
Type	2018							2017
of		Capital		Income		Cash Interest			Capital		Income		Cash Interest
Properties		Contribution		Recognized		Received			Contribution		Recognized		Received
ALF/MC/ILF	$	497	$	951	$	1,062		$	987	$	719	$	619
ALF/IL/MC		—		255		194			—		255		135
UDP-ALF/MC		—		151		—	(1)		2,747		46		—	(1)
Total	$	497	$	1,357	$	1,256		$	3,734	$	1,020	$	754

We withheld $653 at the time of loan origination which is being applied to interest. As of June 30, 2018, we still hold $336 which will be applied to future interest.