Real estate owned (REO) (Tables)

6 Months Ended

Jun. 30, 2016

Transactions and activity, including changes in the net book values, are presented in the following table for the three and six months ended June 30, 2016 ($ in thousands).

	Three Months Ended June 30,			Six Months Ended June 30,
Balance, beginning of period	$	82,164		$	82,949
Acquisitions		—			1,388
Dispositions		(2,082	)		(4,416	)
Improvements/betterments		84			245
Balance, end of period	$	80,166		$	80,166

REO Held for Sale by Property Type

REO summarized by property classification is presented in the following table ($ in thousands).

	June 30, 2016				December 31, 2015
	Properties		NBV		Properties		NBV
Property classification
Rental		9	$	76,366		8	$	79,149
Non-Rental		3		3,800		3		3,800
Total REO, net		12	$	80,166		11	$	82,949

Earnings/(Loss) from Rental Operations of the Real Estate Owned, Held as Investment

Earnings from rental operations are presented in the following table for the three and six months ended June 30, 2016 and 2015 ($ in thousands).

	Three Months Ended				Six Months Ended
	2016		2015		2016		2015
Rental income	$	1,414	$	2,544	$	2,781	$	5,128
Operating expenses, rentals
Administration and payroll		198		344		383		687
Homeowner association fees		115		182		230		376
Professional services		16		14		26		17
Utilities and maintenance		183		242		388		544
Advertising and promotions		4		19		9		37
Property taxes		188		301		397		620
Other		59		81		81		141
Total operating expenses, rentals		763		1,183		1,514		2,422
Net operating income		651		1,361		1,267		2,706
Depreciation		—		77		—		294
Receiver fees		2		4		2		10
Rental operations, net		649		1,280		1,265		2,402
Interest on mortgages		274		393		502		773
Rental operation, net of mortgage interest	$	375	$	887	$	763	$	1,629

Schedule of Participating Mortgage Loans

Mortgages payable transactions are summarized in the following table for the six months ended June 30, 2016 ($ in thousands).

	2016
Principal, January 1	$	27,509
Mortgages acquired by foreclosure⁽¹⁾		926
Principal repaid		(1,207	)
Principal, June 30	$	27,228

(1)

In February, 2016, the partnership took ownership of a property through foreclosure of its second mortgage, subject to the existing deed of trust. The loan was paid in full in June, 2016.

Mortgage payable as of June 30, 2016 and December 31, 2015 are summarized in the following table (mortgage balance $ in thousands).

June 30,

December 31,

2016

2015

NorthMarq Capital – Secured by a condominium complex,

located in Los Angeles County, matures July 1, 2022,

interest rate (3.11%) varies monthly (LIBOR plus 2.73%),

monthly payment⁽²⁾⁽³⁾ $167,753

27,228

27,509

(2)	Monthly payments include amounts for various impounds such as property taxes, insurance, and repairs.

(3)	Monthly payments based upon a 30-year amortization, with a balloon payment due at maturity.

Schedule of Future Minimum Rental Payments for Operating Leases

Future minimum payments of principal at June 30, 2016 are presented in the following table ($ in thousands).

2016 (July 1 to December 31)	$	290
2017		595
2018		613
2019		633
2020		653
Thereafter		24,444
Total	$	27,228