11. Commitments and Contingencies

At December 31, 2018, we had commitments as follows (in thousands):


						Total
	Investment			2018		Commitment		Remaining
	Commitment			Funding		Funded		Commitment
Real estate properties (Note 5. Real Estate Investments)	$	77,882	(1)	$	28,343	$	45,787	$	32,095
Accrued incentives and earn-out liabilities		9,000	(2)		—		—		9,000
Mortgage loans (Note 5. Real Estate Investments)		64,200	(3)		4,330		18,591		45,609
Joint venture investments (Note 6. Investments in Unconsolidated Joint Ventures)		25,650			670		23,684		1,966
Notes receivable (Note 7. Notes Receivable)		7,828	(4)		124		124		7,704
Total	$	184,560		$	33,467	$	88,186	$	96,374

(1)

Represents commitments to purchase land and improvements, if applicable, and to develop, re-develop, renovate or expand seniors housing and health care properties. Additionally, we have certain master leases that provide for additional capital expenditure allowance upon pre-approval of projects.

(2)

During the twelve months ended December 31, 2018, we recorded non-cash interest expense of $377 related to these contingent liabilities. During the fourth quarter of 2018, we entered into an amended master lease agreement with Senior Lifestyle. Among the provisions of the amendment, the contingent lease incentive payable to Senior Lifestyle was removed. Therefore, we wrote-off the Senior Lifestyle contingent lease incentive of $6,219 and the related earn-out liability of $9,292 which resulted in income of approximately $3,000.

(3)

$35,700 represents commitments to expand and renovate the seniors housing and health care properties securing the mortgage loans and $28,500 represents contingent funding upon the borrower achieving certain coverage ratios.

(4)

During the fourth quarter of 2018, we entered into a $6,800 mezzanine loan commitment for the development of a 204-unit ILF/ALF/MC in Georgia which will be funded during the first quarter of 2019. The mezzanine loan has a five-year term and bears interest at 12%, with 8% current-pay during the first 46 months of the loan, and the balance accruing to the note and 12% current-pay thereafter.

Also, some of our lease agreements provide purchase options allowing the lessees to purchase the properties they currently lease from us. The following table summarizes information about purchase options included in our lease agreements:


	Type	Number
	of	of		Gross		Carrying	Option
State	Property	Properties		Investments		Value	Window
Kansas	MC	2	$	25,692	$	23,906	2019-2021
Texas	MC	2		25,265		24,955	2025-2027
Total			$	50,957	$	48,861

We are a party from time to time to various general and professional liability claims and lawsuits asserted against the lessees or borrowers of our properties, which in our opinion are not singularly or in the aggregate material to our results of operations or financial condition. These types of claims and lawsuits may include matters involving general or professional liability, which we believe under applicable legal principles are not our responsibility as a non-possessory landlord or mortgage holder. We believe that these matters are the responsibility of our lessees and borrowers pursuant to general legal principles and pursuant to insurance and indemnification provisions in the applicable leases or mortgages. We intend to continue to vigorously defend such claims.