RECEIVABLE FROM AND PAYABLE TO RELATED PARTIES

6 Months Ended

Jun. 30, 2015

RECEIVABLE FROM AND PAYABLE TO RELATED PARTIES

RECEIVABLE FROM AND PAYABLE TO RELATED PARTIES

NOTE 5. RECEIVABLE FROM AND PAYABLE TO RELATED PARTIES

From time to time, IOT and its related parties have made unsecured advances to each other which include transactions involving the purchase, sale, and financing of property. In addition, we have a cash management agreement with our Advisor. The agreement provides for excess cash to be invested in and managed by our Advisor, Pillar, a related party. The table below reflects the various transactions between IOT, Pillar, and TCI (dollars in thousands):

	TCI		Pillar			Total
Related party receivable, December 31, 2014	$	40,460	$	—		$	40,460
Cash transfers		—		1,875			1,875
Advisory fees		—		(350	)		(350	)
Net income fee		—		(90	)		(90	)
Cost reimbursements		—		(127	)		(127	)
Expenses paid by advisor		—		42			42
Financing (mortgage payments)		—		(734	)		(734	)
Interest income		792		—			792
Purchase of obligation		616		(616	)		—
Related party receivable, June 30, 2015	$	41,868	$	—		$	41,868

We have historically engaged in and will continue to engage in certain business transactions with related parties, including but not limited to asset acquisitions and dispositions. Transactions involving related parties cannot be presumed to be carried out on an arm’s length basis due to the absence of free market forces that naturally exist in business dealings between two or more unrelated entities. Related party transactions may not always be favorable to our business and may include terms, conditions and agreements that are not necessarily beneficial to or in the best interest of the Company.