Notes Receivable

9 Months Ended

Sep. 30, 2022

4.	Notes Receivable

Notes receivable consists of mezzanine loans and other loan arrangements. The following table is a summary of our notes receivable components as of September 30, 2022 and December 31, 2021 (in thousands):


	September 30, 2022		December 31, 2021
Mezzanine loans ⁽¹⁾	$	36,816	$	11,815
Other loans		22,198		16,808
Notes receivable credit loss reserve		(590)		(286)
Total	$	58,424	$	28,337

(1)

During the first quarter of 2022, we originated a $25,000 mezzanine loan for the recapitalization of a five-property seniors housing portfolio. The mezzanine loan has a term of approximately five years, with two one-year extension options and bears interest at 8% with an IRR of 11%. The five communities are located in Oregon and Montana, have a total of 621 units, and include independent living, assisted living and memory care.

The following table summarizes our notes receivable activity for the nine months ended September 30, 2022 and 2021 (in thousands):


	Nine Months Ended September 30,
		2022			2021
Advances under notes receivable	$	37,008	⁽¹⁾	$	6,453
Interest reserve withheld		—			353
Principal payments received under notes receivable		(6,618)			(2,553)
Provision for credit losses		(303)			43
Net increase in notes receivable	$	30,087		$	4,296

(1)

Includes origination of a $25,000 mezzanine loan for the recapitalization of five assisted living communities located in Oregon and Montana. Additionally includes origination of a working capital loan for a commitment of up to $2,000, of which $1,867 has been funded and $9,761 of funding under a working capital loan to HMG Healthcare, LLC (“HMG”).