Cover
Cover - shares shares in Millions | 3 Months Ended | |
Mar. 31, 2023 | May 05, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2023 | |
Document Transition Report | false | |
Entity File Number | 000-54939 | |
Entity Registrant Name | CIM REAL ESTATE FINANCE TRUST, INC. | |
Entity Incorporation, State or Country Code | MD | |
Entity Tax Identification Number | 27-3148022 | |
Entity Address, Address Line One | 2398 East Camelback Road, 4th Floor | |
Entity Address, City or Town | Phoenix, | |
Entity Address, State or Province | AZ | |
Entity Address, Postal Zip Code | 85016 | |
City Area Code | (602) | |
Local Phone Number | 778-8700 | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Non-accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 436.9 | |
Entity Central Index Key | 0001498547 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2023 | |
Document Fiscal Period Focus | Q1 | |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Real estate assets: | ||
Land | $ 338,087 | $ 578,970 |
Buildings, fixtures and improvements | 864,447 | 1,462,726 |
Intangible lease assets | 164,136 | 276,684 |
Condominium developments | 131,633 | 130,494 |
Total real estate assets, at cost | 1,498,303 | 2,448,874 |
Less: accumulated depreciation and amortization | (154,235) | (270,946) |
Total real estate assets, net | 1,344,068 | 2,177,928 |
Investment in unconsolidated entities | 97,384 | 100,604 |
Real estate-related securities ($520,639 and $576,391 held at fair value as of March 31, 2023 and December 31, 2022, respectively) | 520,639 | 576,391 |
Loans held-for-investment and related receivables, net | 3,976,316 | 4,043,898 |
Less: Current expected credit losses | (43,779) | (42,344) |
Total loans held-for-investment and related receivables, net | 3,932,537 | 4,001,554 |
Cash and cash equivalents | 555,245 | 118,978 |
Restricted cash | 58,390 | 57,616 |
Rents and tenant receivables, net | 20,977 | 33,968 |
Derivative assets, prepaid expenses and other assets | 10,711 | 26,243 |
Deferred costs, net | 17,152 | 16,429 |
Accrued interest receivable | 23,412 | 22,343 |
Assets held for sale | 65,011 | 0 |
Total assets | 6,645,526 | 7,132,054 |
LIABILITIES AND STOCKHOLDERS’ EQUITY | ||
Repurchase facilities, notes payable and credit facilities, net | 3,961,213 | 4,422,833 |
Accrued expenses and accounts payable | 26,357 | 25,666 |
Due to affiliates | 13,816 | 16,086 |
Intangible lease liabilities, net | 14,269 | 19,054 |
Distributions payable | 15,310 | 14,828 |
Deferred rental income and other liabilities | 5,960 | 7,274 |
Total liabilities | 4,036,925 | 4,505,741 |
Commitments and contingencies (Note 11) | ||
Redeemable common stock | 170,451 | 170,238 |
STOCKHOLDERS’ EQUITY | ||
Preferred stock, $0.01 par value per share; 10,000,000 shares authorized, none issued and outstanding | 0 | 0 |
Common stock, $0.01 par value per share; 490,000,000 shares authorized, 437,429,808 and 437,397,414 shares issued and outstanding as of March 31, 2023 and December 31, 2022, respectively | 4,374 | 4,373 |
Capital in excess of par value | 3,529,644 | 3,529,523 |
Accumulated distributions in excess of earnings | (1,021,032) | (1,029,287) |
Accumulated other comprehensive loss | (74,836) | (48,526) |
Total stockholders’ equity | 2,438,150 | 2,456,083 |
Non-controlling interests | 0 | (8) |
Total equity | 2,438,150 | 2,456,075 |
Total liabilities, redeemable common stock, non-controlling interests and stockholders’ equity | $ 6,645,526 | $ 7,132,054 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Statement of Financial Position [Abstract] | ||
Fair value of CMBS | $ 520,639 | $ 576,391 |
Preferred stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 490,000,000 | 490,000,000 |
Common stock, shares issued (in shares) | 437,429,808 | 437,397,414 |
Common stock, shares outstanding (in shares) | 437,429,808 | 437,397,414 |
Condensed Consolidated Statemen
Condensed Consolidated Statements Of Operations - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Revenues: | ||
Rental and other property income | $ 38,781 | $ 73,736 |
Interest income | 108,083 | 31,463 |
Total revenues | 146,864 | 105,199 |
Expenses: | ||
General and administrative | 3,298 | 3,475 |
Interest expense, net | 66,234 | 29,996 |
Property operating | 2,576 | 7,727 |
Real estate tax | 817 | 6,713 |
Expense reimbursements to related parties | 3,568 | 3,694 |
Management fees | 12,579 | 13,347 |
Transaction-related | 13 | 7 |
Depreciation and amortization | 15,110 | 19,141 |
Real estate impairment | 4,814 | 3,291 |
Increase in provision for credit losses | 1,453 | 4,709 |
Total expenses | 110,462 | 92,100 |
Other income (expense): | ||
Gain on disposition of real estate and condominium developments, net | 19,623 | 32,574 |
(Loss) gain on investment in unconsolidated entities | (770) | 5,340 |
Unrealized gain (loss) on equity security | 2,258 | (2,346) |
Other income, net | 324 | 1,305 |
Loss on extinguishment of debt | (3,645) | (10,871) |
Total other income (expense) | 17,790 | 26,002 |
Net income | 54,192 | 39,101 |
Net income allocated to noncontrolling interest | 8 | 9 |
Net income attributable to the Company | $ 54,184 | $ 39,092 |
Weighted average number of common shares outstanding: | ||
Basic (in shares) | 437,433,853 | 437,374,008 |
Diluted (in shares) | 437,433,853 | 437,374,008 |
Net income per common share: | ||
Basic (in usd per share) | $ 0.12 | $ 0.09 |
Diluted (in usd per share) | $ 0.12 | $ 0.09 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 54,192 | $ 39,101 |
Other comprehensive loss | ||
Unrealized loss on real estate-related securities | (26,310) | (4,878) |
Unrealized gain on interest rate swaps | 0 | 1,488 |
Amount of gain reclassified from other comprehensive loss into income as interest expense, net | 0 | (7) |
Total other comprehensive loss | (26,310) | (3,397) |
Comprehensive income | 27,882 | 35,704 |
Comprehensive income attributable to noncontrolling interest | 8 | 9 |
Comprehensive income attributable to the Company | $ 27,874 | $ 35,695 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements Of Stockholders’ Equity - USD ($) $ in Thousands | Total | Total Stockholders’ Equity | Common Stock | Capital in Excess of Par Value | Accumulated Distributions in Excess of Earnings | Accumulated Other Comprehensive Income (Loss) | Non-Controlling Interests |
Beginning balance (in shares) at Dec. 31, 2021 | 437,373,981 | ||||||
Beginning balance at Dec. 31, 2021 | $ 2,528,961 | $ 2,527,888 | $ 4,374 | $ 3,529,126 | $ (1,008,561) | $ 2,949 | $ 1,073 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock (in shares) | 1,329,825 | ||||||
Issuance of common stock | 9,574 | 9,574 | $ 13 | 9,561 | |||
Equity-based compensation | 37 | 37 | 37 | ||||
Distributions declared on common stock | (40,018) | (40,018) | (40,018) | ||||
Redemptions of common stock (in shares) | (1,345,814) | ||||||
Redemptions of common stock | (9,689) | (9,689) | $ (13) | (9,676) | |||
Changes in redeemable common stock | 115 | 115 | 115 | ||||
Distributions to non-controlling interests | (14) | (14) | |||||
Comprehensive income (loss) | 35,704 | 35,695 | 39,092 | (3,397) | 9 | ||
Ending balance (in shares) at Mar. 31, 2022 | 437,357,992 | ||||||
Ending balance at Mar. 31, 2022 | $ 2,524,670 | 2,523,602 | $ 4,374 | 3,529,163 | (1,009,487) | (448) | 1,068 |
Beginning balance (in shares) at Dec. 31, 2022 | 437,397,414 | 437,397,414 | |||||
Beginning balance at Dec. 31, 2022 | $ 2,456,075 | 2,456,083 | $ 4,373 | 3,529,523 | (1,029,287) | (48,526) | (8) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||||
Issuance of common stock (in shares) | 1,637,923 | ||||||
Issuance of common stock | 10,763 | 10,763 | $ 17 | 10,746 | |||
Equity-based compensation | 120 | 120 | 120 | ||||
Distributions declared on common stock | (45,929) | (45,929) | (45,929) | ||||
Redemptions of common stock (in shares) | (1,605,529) | ||||||
Redemptions of common stock | (10,548) | (10,548) | $ (16) | (10,532) | |||
Changes in redeemable common stock | (213) | (213) | (213) | ||||
Comprehensive income (loss) | $ 27,882 | 27,874 | 54,184 | (26,310) | 8 | ||
Ending balance (in shares) at Mar. 31, 2023 | 437,429,808 | 437,429,808 | |||||
Ending balance at Mar. 31, 2023 | $ 2,438,150 | $ 2,438,150 | $ 4,374 | $ 3,529,644 | $ (1,021,032) | $ (74,836) | $ 0 |
Condensed Consolidated Statem_4
Condensed Consolidated Statements Of Stockholders’ Equity (Parenthetical) - $ / shares | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Statement of Stockholders' Equity [Abstract] | ||
Distributions declared on common stock (in USD per share) | $ 0.11 | $ 0.09 |
Condensed Consolidated Statem_5
Condensed Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Cash flows from operating activities: | ||
Net income | $ 54,192 | $ 39,101 |
Adjustments to reconcile net loss to net cash provided by operating activities: | ||
Depreciation and amortization, net | 15,125 | 19,108 |
Amortization of deferred financing costs | 3,190 | 3,381 |
Amortization and accretion on deferred loan fees | (3,324) | (2,441) |
Amortization of premiums and discounts on credit investments | (8,481) | (591) |
Capitalized interest income on real estate-related securities | (284) | (272) |
Equity-based compensation | 120 | 37 |
Straight-line rental income | (1,120) | (1,721) |
Write-offs for uncollectible lease-related receivables | 338 | 187 |
Gain on disposition of real estate assets and condominium developments, net | (19,623) | (32,574) |
Loss (gain) on sale of credit investments, net | 64 | (65) |
Loss (gain) on investment in unconsolidated entities | 770 | (5,340) |
Gain on sale of marketable security | 0 | (22) |
Unrealized (gain) loss on equity security | (2,258) | 2,368 |
Amortization of fair value adjustment and gain on interest rate swaps | 0 | 92 |
Loss (gain) on interest rate caps | 1,960 | (1,176) |
Impairment of real estate assets | 4,814 | 3,291 |
Increase in provision for credit losses | 1,453 | 4,709 |
Write-off of deferred financing costs | 2,354 | 7,068 |
Return on investment in unconsolidated entities | 0 | 531 |
Changes in assets and liabilities: | ||
Rents and tenant receivables, net | 4,901 | 33,078 |
Prepaid expenses and other assets | 13,572 | (20,530) |
Accrued interest receivable | (1,069) | (2,792) |
Accrued expenses and accounts payable | 2,008 | (7,648) |
Deferred rental income and other liabilities | (1,314) | (9,167) |
Due to affiliates | (2,270) | 1,457 |
Net cash provided by operating activities | 65,118 | 30,069 |
Cash flows from investing activities: | ||
Investment in unconsolidated entities | 0 | (24,750) |
Return of investment in unconsolidated entities | 2,450 | 0 |
Investment in real estate-related securities | (9,401) | (155,618) |
Investment in liquid corporate senior loans | (26,804) | (61,030) |
Investment in real estate assets and capital expenditures | (2,495) | (9,533) |
Investment in corporate senior loans | (16,763) | (10,000) |
Investment in first mortgage loans | (17,007) | (784,129) |
Origination and exit fees received on loans held-for-investment | 0 | 9,540 |
Principal payments received on loans held-for-investment | 123,996 | 102,475 |
Principal payments received on real estate-related securities | 48,975 | 0 |
Net proceeds from sale of real estate-related securities | 0 | 132 |
Net proceeds from disposition of real estate assets and condominium developments | 775,144 | 923,400 |
Net proceeds from sale of liquid corporate senior loans | 8,311 | 23,834 |
Redemption of investment in unconsolidated entities | 0 | 48,500 |
Net cash provided by investing activities | 886,406 | 62,821 |
Cash flows from financing activities: | ||
Redemptions of common stock | (10,548) | (9,689) |
Distributions to stockholders | (34,684) | (30,357) |
Proceeds from borrowings | 53,275 | 903,060 |
Repayments of borrowings, and prepayment penalties | (519,069) | (857,815) |
Termination of interest rate swaps | 0 | (101) |
Distributions to non-controlling interests | 0 | (14) |
Deferred financing costs paid | (3,457) | (4,550) |
Net cash (used in) provided by financing activities | (514,483) | 534 |
Net increase in cash and cash equivalents and restricted cash | 437,041 | 93,424 |
Cash and cash equivalents and restricted cash, beginning of period | 176,594 | 144,173 |
Cash and cash equivalents and restricted cash, end of period | 613,635 | 237,597 |
Reconciliation of cash and cash equivalents and restricted cash to the condensed consolidated balance sheets: | ||
Cash and cash equivalents | 555,245 | 165,111 |
Restricted cash | 58,390 | 72,486 |
Total cash and cash equivalents and restricted cash | 613,635 | 237,597 |
Supplemental Disclosures of Non-Cash Investing and Financing Activities: | ||
Distributions declared and unpaid | 15,310 | 13,339 |
Accrued capital expenditures | 468 | 1,315 |
Accrued deferred financing costs | 174 | 157 |
Construction reserve allocation | (190) | 0 |
Mortgage notes payable assumed by buyer in connection with disposition of real estate assets | 0 | (19,250) |
Common stock issued through distribution reinvestment plan | 10,763 | 9,574 |
Change in fair value of derivative instruments | 0 | 1,389 |
Change in fair value of real estate-related securities | (26,309) | (7,246) |
Supplemental Cash Flow Disclosures: | ||
Interest paid | 63,543 | 28,622 |
Cash paid for taxes | $ 39 | $ 47 |
ORGANIZATION AND BUSINESS
ORGANIZATION AND BUSINESS | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
ORGANIZATION AND BUSINESS | NOTE 1 — ORGANIZATION AND BUSINESS CIM Real Estate Finance Trust, Inc. (the “Company”) is a non-exchange traded real estate investment trust (“REIT”) formed as a Maryland corporation on July 27, 2010, that elected to be taxed, and operates its business to qualify, as a REIT for U.S. federal income tax purposes beginning with its taxable year ended December 31, 2012. The Company seeks to attain attractive risk-adjusted returns and create long term value for its investors by investing in a diversified portfolio of senior secured mortgage loans, creditworthy long-term net-leased property investments and other senior loan and liquid credit investments. As of March 31, 2023, the Company owned 228 properties, comprising approximately 6.9 million rentable square feet of commercial space located in 37 states. As of March 31, 2023, the rentable square feet at these properties was 98.9% leased, including month-to-month agreements, if any. As of March 31, 2023, the Company’s loan portfolio consisted of 349 loans with a net book value of $3.9 billion, and investments in real estate-related securities of $520.6 million. As of March 31, 2023, the Company owned condominium developments with a net book value of $131.6 million. A majority of the Company’s business is conducted through CIM Real Estate Finance Operating Partnership, LP, a Delaware limited partnership, of which the Company is the sole general partner and owns, directly or indirectly, 100% of the partnership interests. The Company is externally managed by CIM Real Estate Finance Management, LLC, a Delaware limited liability company (“CMFT Management”), which is an affiliate of CIM Group, LLC (“CIM Group”). CIM Group is a community-focused real estate and infrastructure owner, operator, lender and developer. CIM Group is headquartered in Los Angeles, CA, with offices in Atlanta, GA, Chicago, IL, Dallas, TX, New York, NY, Orlando, FL, Phoenix, AZ and Tokyo, Japan. CIM Group also maintains additional offices across the United States, as well as in Korea, Hong Kong and the United Kingdom to support its platform. The Company relies upon CIM Capital IC Management, LLC, the Company’s investment advisor (the “Investment Advisor”), to provide substantially all of the Company’s day-to-day management with respect to investments in securities and certain other investments. Collectively, CMFT Management, the Company’s manager, and the Investment Advisor, together with certain other affiliates of CIM Group, serve as the Company’s sponsor, which is referred to as the Company’s “sponsor” or “CIM”. On January 26, 2012, the Company commenced its initial public offering on a “best efforts” basis of up to a maximum of $2.975 billion in shares of common stock (the “Initial Offering”). The Company ceased issuing shares in the Initial Offering on April 4, 2014. At the completion of the Initial Offering, a total of approximately 297.4 million shares of common stock had been issued, including approximately 292.3 million shares of common stock sold to the public pursuant to the primary portion of the Initial Offering and approximately 5.1 million shares of common stock issued pursuant to the distribution reinvestment plan (“DRIP”) portion of the Initial Offering. The remaining approximately 404,000 unsold shares from the Initial Offering were deregistered. The Company registered $247.0 million of shares of common stock under the DRIP (the “Initial DRIP Offering”) pursuant to a Registration Statement on Form S-3 (Registration No. 333-192958), which was filed with the U.S. Securities and Exchange Commission (the “SEC”) on December 19, 2013 and automatically became effective with the SEC upon filing. The Company ceased issuing shares under the Initial DRIP Offering effective as of June 30, 2016. At the completion of the Initial DRIP Offering, a total of approximately $241.7 million of shares of common stock had been issued. The remaining $5.3 million of unsold shares from the Initial DRIP Offering were deregistered. The Company registered an additional $600.0 million of shares of common stock under the DRIP (the “Secondary DRIP Offering,” and together with the Initial DRIP Offering, the “DRIP Offerings,” and the DRIP Offerings collectively with the Initial Offering, the “Offerings”) pursuant to a Registration Statement on Form S-3 (Registration No. 333-212832), which was filed with the SEC on August 2, 2016 and automatically became effective with the SEC upon filing. The Company began to issue shares under the Secondary DRIP Offering on August 2, 2016 and continues to issue shares under the Secondary DRIP Offering. The Company’s board of directors (the “Board”) establishes an updated estimated per share net asset value (“NAV”) of the Company’s common stock on at least an annual basis for purposes of assisting broker-dealers that participated in the Initial Offering in meeting their customer account reporting obligations under Financial Industry Regulatory Authority Rule 2231. |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | NOTE 2 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The summary of significant accounting policies presented below is designed to assist in understanding the Company’s condensed consolidated financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in all material respects, and have been consistently applied in preparing the accompanying condensed consolidated financial statements. Principles of Consolidation and Basis of Presentation The condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the SEC regarding interim financial reporting, including the instructions to Form 10-Q and Article 10 of Regulation S-X, and do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the statements for the interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair presentation of the results for such periods. Results for these interim periods are not necessarily indicative of full year results. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements as of and for the year ended December 31, 2022, and related notes thereto, set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The condensed consolidated financial statements should also be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this Quarterly Report on Form 10-Q. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In determining whether the Company has controlling interests in an entity and is required to consolidate the accounts in that entity, the Company analyzes its credit and real estate investments in accordance with standards set forth in GAAP to determine whether the entities are variable interest entities (“VIEs”), and if so, whether the Company is the primary beneficiary. The Company’s judgment with respect to its level of influence or control over an entity and whether the Company is the primary beneficiary of a VIE involves consideration of various factors, including the form of the Company’s ownership interest, the Company’s voting interest, the size of the Company’s investment (including loans), and the Company’s ability to participate in major policy-making decisions. The Company’s ability to correctly assess its influence or control over an entity affects the presentation of these credit and real estate investments on the Company’s condensed consolidated financial statements. Reclassifications Certain amounts in the Company’s prior period condensed consolidated financial statements have been reclassified to conform to the current period presentation. The Company has chosen to break out the details of $30.0 million of interest expense, net from other income, net into expenses in the Company’s condensed consolidated statement of operations for the three months ended March 31, 2022, driven by the Company’s current investment portfolio composition being predominantly comprised of credit investments. This reclassification of interest expense, net did not have an impact on net income or cash flow from operating activities. I n addition, the Company has chosen to break out the details of $2.3 million of unrealized loss on equity security from other income, net in the Company’s condensed consolidated statement of operations for the three months ended March 31, 2022. The Company has also chosen to break out the details of $7.2 million of accrued interest receivable from derivative assets, prepaid expenses and other assets derivative assets, prepaid expenses and other assets Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Real Estate Assets Real estate assets are stated at cost, less accumulated depreciation and amortization. The Company considers the period of future benefit of each respective asset to determine the appropriate useful life. The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term Recoverability of Real Estate Assets The Company continually monitors events and changes in circumstances that could indicate that the carrying amounts of its real estate assets may not be recoverable. Impairment indicators that the Company considers include, but are not limited to: bankruptcy or other credit concerns of a property’s major tenant, such as a history of late payments, lease concessions and other factors; a significant decrease in a property’s revenues due to lease terminations; vacancies; co-tenancy clauses; reduced lease rates; changes in anticipated holding periods; significant increases to budgeted costs for units under development; and a reduction in prevailing market values for assets being considered for disposition. When indicators of potential impairment are present, the Company assesses the recoverability of the assets by determining whether the carrying amount of the assets will be recovered through the undiscounted future cash flows expected from the use of the assets and their eventual disposition. In the event that such expected undiscounted future cash flows do not exceed the carrying amount, the Company will adjust the real estate assets to their respective fair values and recognize an impairment loss. Generally, fair value is determined using a discounted cash flow analysis and recent comparable sales transactions. During the three months ended March 31, 2023, as part of the Company’s quarterly impairment review procedures, the Company recorded impairment charges of $4.8 million related to one property, due to the sales price being less than its respective carrying value. The Company’s impairment assessment as of March 31, 2023 was based on the most current information available to the Company, including expected holding periods. If the Company’s expected holding periods for assets change, subsequent tests for impairment could result in additional impairment charges in the future. The Company cannot provide any assurance that additional material impairment charges with respect to the Company’s real estate assets will not occur during 2023 or in future periods. During the three months ended March 31, 2022, the Company recorded impairment charges of $3.3 million related to seven properties, all of which was due to sales prices that were less than their respective carrying values. The assumptions and uncertainties utilized in the evaluation of the impairment of real estate assets are discussed in detail in Note 3 — Fair Value Measurements. See also Note 4 — Real Estate Assets for further discussion regarding real estate investment activity. Assets Held for Sale When a real estate asset is identified by the Company as held for sale, the Company will cease recording depreciation and amortization of the assets related to the property and estimate its fair value, net of selling costs. If, in management’s opinion, the fair value, net of selling costs, of the asset is less than the carrying amount of the asset, an adjustment to the carrying amount is then recorded to reflect the estimated fair value of the property, net of selling costs. As of March 31, 2023, in connection with the Realty Income Purchase and Sale Agreement (as defined in Note 4 — Real Estate Assets), the Company identified 27 properties with a fair value of $65.0 million as held for sale. The Company disposed of these properties subsequent to March 31, 2023, as further discussed in Note 17 — Subsequent Events. Dispositions of Real Estate Assets Gains and losses from dispositions are recognized once the various criteria relating to the terms of sale and any subsequent involvement by the Company with the asset sold are met. A discontinued operation includes only the disposal of a component of an entity and represents a strategic shift that has (or will have) a major effect on an entity’s financial results. Given the Company’s current asset portfolio and strategy, the Company’s dispositions during the three months ended March 31, 2023 and 2022 did not qualify for discontinued operations presentation and thus, the results of the properties and condominiums that were sold will remain in operating income, and any associated gains or losses from the dispositions are included in gain on disposition of real estate and condominium developments, net. See Note 4 — Real Estate Assets for a discussion of the disposition of individual properties and condominiums during the three months ended March 31, 2023. Allocation of Purchase Price of Real Estate Assets Upon the acquisition of real properties, the Company allocates the purchase price to acquired tangible assets, consisting of land, buildings and improvements, and to identified intangible assets and liabilities, consisting of the value of above- and below-market leases and the value of in-place leases and other intangibles, based in each case on their relative fair values. The Company utilizes independent appraisals to assist in the determination of the fair values of the tangible assets of an acquired property (which includes land and buildings). The information in the appraisal, along with any additional information available to the Company’s management, is used in estimating the amount of the purchase price that is allocated to land. Other information in the appraisal, such as building value and market rents, may be used by the Company’s management in estimating the allocation of purchase price to the building and to intangible lease assets and liabilities. The appraisal firm has no involvement in management’s allocation decisions other than providing this market information. The determination of the fair values of the real estate assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, capitalization and discount rates, interest rates and other variables. The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations. Certain acquisition-related expenses related to asset acquisitions are capitalized and allocated to tangible and intangible assets and liabilities, as described above. Acquisition-related manager expense reimbursements are expensed as incurred and are included in expense reimbursements to related parties in the accompanying condensed consolidated statements of operations. Other acquisition-related expenses continue to be expensed as incurred and are included in transaction-related expenses in the accompanying condensed consolidated statements of operations. Investment in Unconsolidated Entities CMFT MT JV Holdings, LLC, an indirect wholly-owned subsidiary of the Company, is engaged in an unconsolidated joint venture arrangement through CIM NP JV Holdings, LLC (“NP JV Holdings”) (the “Unconsolidated Joint Venture”), of which it owns 50% of the outstanding equity. Through the Unconsolidated Joint Venture, which holds approximately 90% of the membership interest in NewPoint JV, LLC (the “NewPoint JV”) pursuant to the terms of the Operating Agreement entered into between the Unconsolidated Joint Venture and NewPoint Bridge Lending, LLC, the Company indirectly owns approximately 45% of the outstanding equity of the NewPoint JV on a fully diluted basis. The Company accounts for its investment under the equity method. The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and is subsequently adjusted for the Company’s share of equity in NP JV Holdings’ earnings and distributions, including unrealized gains and losses as a result of changes in fair value of the NewPoint JV. The Company records its share of NP JV Holdings’ profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s condensed consolidated balance sheet and such share is recognized as a profit or loss on the condensed consolidated statements of operations. The Company recorded a loss totaling $770,000, which represented its share of NP JV Holdings’ loss, during the three months ended March 31, 2023 in the condensed consolidated statements of operations. As of March 31, 2023, the Company’s aggregate investment in NP JV Holdings of $97.4 million is included in investment in unconsolidated entities on the condensed consolidated balance sheets. For more information, refer to Note 6 — Investment in Unconsolidated Entities. On March 31, 2022, the Company fully redeemed its $60.7 million investment in CIM UII Onshore, L.P. (“CIM UII Onshore”). Prior to redemption, the Company had less than 5% ownership of CIM UII Onshore and accounted for its investment under the equity method. The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and subsequently adjusted for the Company’s share of equity in CIM UII Onshore’s earnings and distributions. Prior to redemption, the Company recorded its share of CIM UII Onshore’s profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s consolidated balance sheet and such share is recognized as a profit or loss on the consolidated statements of operations. During the three months ended March 31, 2022, the Company recorded its share of CIM UII Onshore’s gain totaling $5.2 million. The Company received distributions of $531,000 related to its investment in CIM UII Onshore, all of which was recognized as a return on investment. Restricted Cash The Company had $58.4 million and $57.6 million in restricted cash as of March 31, 2023 and December 31, 2022, respectively. Included in restricted cash was $16.8 million and $15.4 million held by lenders in lockbox accounts, as of March 31, 2023 and December 31, 2022, respectively. As part of certain debt agreements, rents from certain encumbered properties are deposited directly into a lockbox account, from which the monthly debt service payment is disbursed to the lender and the excess is disbursed to the Company. Also included in restricted cash was $22.0 million and $22.6 million of construction reserves, amounts held by lenders in escrow accounts for real estate taxes and other lender reserves for certain properties, in accordance with the associated lender’s loan agreement as of March 31, 2023 and December 31, 2022, respectively. In addition, the Company had a $19.6 million deposit held as cash collateral included in restricted cash as of March 31, 2023 and December 31, 2022 to be applied by Barclays Bank PLC (“Barclays”) as repayment of certain eligible assets transferred under the master repurchase agreement with Barclays. Real Estate-Related Securities Real estate-related securities consists primarily of the Company’s investments in commercial mortgage-backed securities (“CMBS”) and equity securities. The Company determines the appropriate classification for real estate-related securities at the time of purchase and reevaluates such designation as of each balance sheet date. As of March 31, 2023, the Company classified its investments in CMBS as available-for-sale as the Company is not actively trading the securities; however, the Company may sell them prior to their maturity. These investments are carried at their estimated fair value with unrealized gains and losses reported in other comprehensive loss. During the three months ended March 31, 2023, the Company invested $9.4 million in CMBS. As of March 31, 2023, the Company had investments in 18 CMBS with an estimated aggregate fair value of $480.1 million. In addition, the Company had an investment in an equity security with an estimated aggregate fair value of $40.5 million as of March 31, 2023, which is comprised of RTL Common Stock received as consideration in connection with the RTL Purchase and Sale Agreement (both of which are defined in Note 4 — Real Estate Assets). This investment is carried at its estimated fair value with unrealized gains and losses reported on the condensed consolidated statements of operations. During the three months ended March 31, 2023, the Company recorded $1.4 million of dividend income on RTL Common Stock, which is included in other income, net on the condensed consolidated statements of operations. The Company also recorded $2.3 million of unrealized gain and $2.4 million of unrealized loss on RTL Common Stock during the three months ended March 31, 2023 and 2022, respectively, which is included in unrealized gain (loss) on equity security in the condensed consolidated statements of operations. The Company monitors its available-for-sale securities for changes in fair value. A loss is recognized when the Company determines that a decline in the estimated fair value of a security below its amortized cost has resulted from a credit loss or other factors. The Company records impairments related to credit losses through current expected credit losses. However, the allowance is limited by the amount that the fair value is less than the amortized cost basis. For additional information regarding the Company’s process for estimating current expected credit losses for its real estate-related securities, see the Current Expected Credit Losses section below. The amortized cost of real estate-related securities is adjusted for amortization of premiums and accretion of discounts to maturity computed under the effective interest method and is recorded in the accompanying condensed consolidated statements of operations in interest income. Upon the sale of a security, the realized net gain or loss is computed on the specific identification method. Interest earned is either received in cash or capitalized to real estate-related securities in the Company’s condensed consolidated balance sheets. Interest is capitalized when certain conditions are met as specified in each security agreement. During the three months ended March 31, 2023 and 2022, the Company capitalized $284,000 and $272,000, respectively, of interest income to real estate-related securities. Loans Held-for-Investment The Company’s loans held-for-investment include loans related to real estate assets, as well as credit investments, including commercial mortgage loans and other loans and securities related to commercial real estate assets, as well as corporate loan opportunities that are consistent with the Company’s investment strategy and objectives. The Company intends to hold the loans held-for-investment for the foreseeable future or until maturity. Loans held-for-investment are carried on the Company’s condensed consolidated balance sheets at amortized cost, net of any current expected credit losses. Discounts or premiums, origination fees and exit fees are amortized as a component of interest income using the effective interest method over the life of the respective loans, or on a straight-line basis when it approximates the effective interest method. Upon the sale of a loan, the realized net gain or loss is computed on the specific identification method. Interest earned is either received in cash or capitalized to loans held-for-investment and related receivables, net in the Company’s condensed consolidated balance sheets. Interest is capitalized when certain conditions are met as specified in each loan agreement. Accrual of interest income is suspended on nonaccrual loans. Loans that are past due 90 days or more as to principal or interest, or where reasonable doubt exists as to timely collection, are generally considered nonperforming and placed on nonaccrual status. Interest collected is recognized on a cash basis by crediting income when received. Loans may be restored to accrual status when all principal and interest are current and full repayment of the remaining contractual principal and interest are reasonably assured. As of March 31, 2023, one of the Company’s liquid corporate senior loan investments was on a nonaccrual status with a carrying value of $2.9 million, which represented less than 1% of the carrying value of the Company’s liquid corporate senior loans portfolio. Current Expected Credit Losses The Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”), on January 1, 2020. Current expected credit losses (“CECL”) required under ASU 2016-13 reflects the Company’s current estimate of potential credit losses related to the Company’s loans held-for-investment included in the condensed consolidated balance sheets. Changes to current expected credit losses are recognized through net income on the Company’s condensed consolidated statements of operations. While ASU 2016-13 does not require any particular method for determining current expected credit losses, it does specify current expected credit losses should be based on relevant information about past events, including historical loss experience, current portfolio and market conditions, and reasonable and supportable forecasts for the duration of each respective loan. In addition, other than a few narrow exceptions, ASU 2016-13 requires that all financial instruments subject to the credit loss model have some amount of loss reserve to reflect the GAAP principal underlying the credit loss model that all loans, debt securities, and similar assets have some inherent risk of loss, regardless of credit quality, subordinate capital, or other mitigating factors. The Company estimates the current expected credit loss for its first mortgage loans primarily using the Weighted Average Remaining Maturity method, which has been identified as an acceptable method for estimating CECL reserves in the Financial Accounting Standards Board (“FASB”) Staff Q&A Topic 326, No. 1. This method requires the Company to reference historic loan loss data across a comparable data set and apply such loss rate to each loan investment over its expected remaining term, taking into consideration expected economic conditions over the relevant timeframe. The Company considers loan investments that are both (i) expected to be substantially repaid through the operation or sale of the underlying collateral, and (ii) for which the borrower is experiencing financial difficulty, to be “collateral-dependent” loans. For such loans that the Company determines that foreclosure of the collateral is probable, the Company measures the expected losses based on the difference between the fair value of the collateral less costs to sell and the amortized cost basis of the loan as of the measurement date. For collateral-dependent loans that the Company determines foreclosure is not probable, the Company applies a practical expedient to estimate expected losses using the difference between the collateral’s fair value (less costs to sell the asset if repayment is expected through the sale of the collateral) and the amortized cost basis of the loan. For the Company’s liquid corporate senior loans and corporate senior loans, the Company uses a probability of default and loss given default method using a comparable data set. The Company may use other acceptable alternative approaches in the future depending on, among other factors, the type of loan, underlying collateral, and availability of relevant historical market loan loss data. Quarterly, the Company evaluates the risk of all loans and assigns a risk rating based on a variety of factors, grouped as follows: (i) loan and credit structure, including the as-is loan-to-value (“LTV”) ratio and structural features; (ii) quality and stability of real estate value and operating cash flow, including debt yield, dynamics of the geography, property type and local market, physical condition, stability of cash flow, leasing velocity and quality and diversity of tenancy; (iii) performance against underwritten business plan; and (iv) quality, experience and financial condition of sponsor, borrower and guarantor(s). Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from least risk to greatest risk, respectively, which ratings are defined as follows: 1- Outperform — Most satisfactory asset quality and liquidity, good leverage capacity. A “1” rating maintains predictable and strong cash flows from operations. The trends and outlook for the credit's operations, balance sheet, and industry are neutral to favorable. Collateral, if appropriate, exceeds performance metrics; 2- Meets or Exceeds Expectations — Acceptable asset quality, moderate excess liquidity, modest leverage capacity. A “2” rating could have some financial/non-financial weaknesses which are offset by strengths; however, the credit demonstrates an ample current cash flow from operations. The trends and outlook for the credit's operations, balance sheet, and industry are generally positive or neutral. Collateral performance, if appropriate, meets or exceeds substantially all performance metrics included in original or current underwriting / business plan; 3- Satisfactory — Acceptable asset quality, somewhat strained liquidity, minimal leverage capacity. A “3” rating is at times characterized by acceptable cash flows from operations. The trends and conditions of the credit's operations and balance sheet are neutral. Collateral performance, if appropriate, meets or is on track to meet underwriting; business plan can reasonably be achieved; 4- Underperformance — The debt investment possesses credit deficiencies or potential weaknesses which deserve management’s close and continued attention. The portfolio company’s operations and/or balance sheet have demonstrated an adverse trend or deterioration which, while serious, has not reached the point where the liquidation of debt is jeopardized. These weaknesses are generally considered correctable by the borrower in the normal course of business but may weaken the asset or inadequately protect the Company’s credit position if not checked or corrected. Collateral performance, if appropriate, falls short of original underwriting, material differences exist from business plan, or both; technical milestones have been missed; defaults may exist, or may soon occur absent material improvement; and 5- Default/Possibility of Loss — The debt investment is protected inadequately by the current enterprise value or paying capacity of the obligor or of the collateral, if any. The underlying company’s operations have well-defined weaknesses based upon objective evidence, such as recurring or significant decreases in revenues and cash flows. Major variance from business plan; loan covenants or technical milestones have been breached; timely exit from loan via sale or refinancing is questionable; risk of principal loss. Collateral performance, if appropriate, is significantly worse than underwriting. The Company generally assigns a risk rating of “3” to all newly originated or acquired loans held-for-investment during a most recent quarter, except in the case of specific circumstances warranting an exception. In estimating credit losses related to real estate-related securities, management considers a variety of factors, including, but not limited to, the extent to which the fair value is less than the amortized cost basis, recent events specific to the security, industry or geographic area, the payment structure of the security, the failure of the issuer of the security to make scheduled interest or principal payments, and external credit ratings and recent changes in such ratings. Leases The Company has lease agreements with lease and non-lease components. The Company has elected to not separate non-lease components from lease components for all classes of underlying assets (primarily real estate assets) and will account for the combined components as rental and other property income. Non-lease components included in rental and other property income include certain tenant reimbursements for maintenance services (including common-area maintenance services or “CAM”), real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. As a lessor, the Company has further determined that this policy will be effective only on a lease that has been classified as an operating lease and the revenue recognition pattern and timing is the same for both types of components. The Company is not a party to any material leases where it is the lessee. Significant judgments and assumptions are inherent in not only determining if a contract contains a lease, but also the lease classification, terms, payments, and, if needed, discount rates. Judgments include the nature of any options, including if they will be exercised, evaluation of implicit discount rates and the assessment and consideration of “fixed” payments for straight-line rent revenue calculations. Lease costs represent the initial direct costs incurred in the origination, negotiation and processing of a lease agreement. Such costs include outside broker commissions and other independent third-party costs and are amortized over the life of the lease on a straight-line basis. Costs related to salaries and benefits, supervision, administration, unsuccessful origination efforts and other activities not directly related to completed lease agreements are expensed as incurred. Upon successful lease execution, leasing commissions are capitalized. Development Activities Project costs and expenses, including interest incurred, associated with the development, construction and lease-up of a real estate project are capitalized as construction in progress. During the three months ended March 31, 2023 and 2022, the Company capitalized $2.7 million and $3.1 million, respectively, of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets. Included in the amounts capitalized during the three months ended March 31, 2023 and 2022 was $458,000 and $387,000, respectively, of capitalized interest expense. Revenue Recognition Revenue from leasing activities Rental and other property income is primarily derived from fixed contractual payments from operating leases, and therefore, is generally recognized on a straight-line basis over the term of the lease, which typically begins the date the tenant takes control of the space. When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation. Variable rental and other property income consists primarily of tenant reimbursements for recoverable real estate taxes and operating expenses which are included in rental and other property income in the period when such costs are incurred, with offsetting expenses in real estate taxes and property operating expenses, respectively, within the condensed consolidated statements of operations. The Company defers the recognition of variable rental and other property income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved. The Company continually reviews whether collection of lease-related receivables, including any straight-line rent, and current and future operating expense reimbursements from tenants are probable. The determination of whether collectability is probable takes into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. Upon the determination that the collectability of a receivable is not probable, the Company will record a reduction to rental and other property income for amounts p |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | NOTE 3 — FAIR VALUE MEASUREMENTS GAAP defines fair value, establishes a framework for measuring fair value, and requires disclosures about fair value measurements. GAAP emphasizes that fair value is intended to be a market-based measurement, as opposed to a transaction-specific measurement. Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date under current market conditions. Depending on the nature of the asset or liability, various techniques and assumptions can be used to estimate the fair value. Assets and liabilities are measured using inputs from three levels of the fair value hierarchy, as follows: Level 1 — Inputs are quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. An active market is defined as a market in which transactions for the assets or liabilities occur with sufficient frequency and volume to provide pricing information on an ongoing basis. Level 2 — Inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active (markets with few transactions), inputs other than quoted prices that are observable for the asset or liability (i.e., interest rates, yield curves, etc.), and inputs that are derived principally from or corroborated by observable market data correlation or other means (market corroborated inputs). Level 3 — Unobservable inputs, which are only used to the extent that observable inputs are not available, reflect the Company’s assumptions about the pricing of an asset or liability. The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities: Real estate-related securities — The Company generally determines the fair value of its real estate-related securities by utilizing broker-dealer quotations, reported trades or valuation estimates from pricing models to determine the reported price. Pricing models for real estate-related securities are generally discounted cash flow models that usually consider the attributes applicable to a particular class of security (e.g., credit rating, seniority), current market data, and estimated cash flows for each class and incorporate deal collateral performance such as prepayment speeds and default rates, as available. Depending upon the significance of the fair value inputs used in determining these fair values, these securities are valued using Level 1, Level 2 or Level 3 inputs. As of March 31, 2023, the Company concluded that $307.5 million of its CMBS fell under Level 2 and $172.6 million of its CMBS fell under Level 3. The Company’s equity security investment is valued using Level 1 inputs. The estimated fair value of the Company’s equity security is based on quoted market prices that are readily and regularly available in an active market. Credit facilities and notes payable — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date. Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs. These financial instruments are valued using Level 2 inputs. As of March 31, 2023, the estimated fair value of the Company’s debt was $3.86 billion, compared to a carrying value of $3.98 billion. The estimated fair value of the Company’s debt as of December 31, 2022 was $4.32 billion, compared to a carrying value of $4.44 billion. Derivative instruments — The Company’s derivative instruments are comprised of interest rate caps. All derivative instruments are carried at fair value and are valued using Level 2 inputs. The fair value of these instruments is determined using interest rate market pricing models. In addition, credit valuation adjustments are incorporated into the fair values to account for the Company’s potential nonperformance risk and the performance risk of the respective counterparties. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. However, as of March 31, 2023 and December 31, 2022, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. Loans held-for-investment — The Company’s loans held-for-investment are recorded at cost upon origination and adjusted by net loan origination fees and discounts. The Company estimates the fair value of its loans held-for-investment by performing a present value analysis for the anticipated future cash flows using an appropriate market discount rate taking into consideration the credit risk. The Company has determined that its commercial real estate (“CRE”) loans held-for-investment and corporate senior loans are classified in Level 3 of the fair value hierarchy. The Company’s liquid corporate senior loans are classified as Level 2 or Level 3 depending on the number of market quotations or indicative prices from pricing services that are available, and whether the depth of the market is sufficient to transact at those prices in amounts approximating the Company’s investment position at the measurement date. As of March 31, 2023, $542.2 million and $129.5 million of the Company’s liquid corporate senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively. As of December 31, 2022, $494.4 million and $168.0 million of the Company’s liquid corporate senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively. As of March 31, 2023, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $3.91 billion, compared to its carrying value of $3.93 billion. As of December 31, 2022, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $3.98 billion, compared to its carrying value of $4.00 billion. Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, restricted cash, tenant receivables, accounts payable and accrued expenses, other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well as their highly-liquid nature. Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments. Considerable judgment is necessary to develop estimated fair values of financial assets and liabilities. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize, or be liable for, upon disposition of the financial assets and liabilities. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. The Company does not expect that changes in classifications between levels will be frequent. Items Measured at Fair Value on a Recurring Basis In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial assets that are required to be measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022 (in thousands): Balance as of Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets: CMBS $ 480,133 $ — $ 307,507 $ 172,626 Equity security 40,506 40,506 — — Interest rate caps 3,080 — 3,080 — Total financial assets $ 523,719 $ 40,506 $ 310,587 $ 172,626 Balance as of Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets: CMBS $ 538,142 $ — $ 348,241 $ 189,901 Equity security 38,249 38,249 — — Interest rate caps 5,040 — 5,040 — Total financial assets $ 581,431 $ 38,249 $ 353,281 $ 189,901 The following are reconciliations of the changes in financial assets with Level 3 inputs in the fair value hierarchy for the three months ended March 31, 2023 (in thousands): Level 3 Beginning Balance, January 1, 2023 $ 189,901 Total gains and losses: Unrealized loss included in other comprehensive loss, net (21,911) Purchases and payments received: Discounts, net 4,352 Capitalized interest income 284 Ending Balance, March 31, 2023 $ 172,626 Items Measured at Fair Value on a Non-Recurring Basis (Including Impairment Charges) Certain financial and nonfinancial assets and liabilities are measured at fair value on a nonrecurring basis and are subject to fair value adjustments in certain circumstances, such as when there is evidence of impairment. The Company’s process for identifying and recording impairment related to real estate assets and intangible assets is discussed in Note 2 — Summary of Significant Accounting Policies. As discussed in Note 4 — Real Estate Assets, during the three months ended March 31, 2023, real estate assets related to one property was deemed to be impaired and its carrying value was reduced to an estimated fair value of $4.8 million, resulting in impairment charges of $4.8 million. During the three months ended March 31, 2022, real estate assets related to seven properties were deemed to be impaired and their carrying values were reduced to an estimated fair value of $29.1 million, resulting in impairment charges of $3.3 million. The Company estimates fair values using Level 3 inputs and a combined income and market approach, specifically using discounted cash flow analysis and recent comparable sales transactions. The evaluation of real estate assets for potential impairment requires the Company’s management to exercise significant judgment and to make certain key assumptions, including, but not limited to, the following: (1) terminal capitalization rates; (2) discount rates; (3) the number of years the property will be held; (4) property operating expenses; and (5) re-leasing assumptions, including the number of months to re-lease, market rental income and required tenant improvements. There are inherent uncertainties in making these estimates such as market conditions and the future performance and sustainability of the Company’s tenants. The Company determined that the selling prices used to determine the fair values were Level 2 inputs. The following summarizes the ranges of discount rates and terminal capitalization rates used for the Company’s impairment test for the real estate assets during the three months ended March 31, 2023 and 2022: Three Months Ended March 31, 2023 2022 Discount Rate Terminal Capitalization Rate Discount Rate Terminal Capitalization Rate 9.7% 7.5% – 9.2% 8.0% – 9.7% 7.5% – 9.2% The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 2022 Asset class impaired: Land $ 1,144 $ 964 Buildings, fixtures and improvements 3,652 1,974 Intangible lease assets 18 354 Intangible lease liabilities — (1) Total impairment loss $ 4,814 $ 3,291 |
REAL ESTATE ASSETS
REAL ESTATE ASSETS | 3 Months Ended |
Mar. 31, 2023 | |
Real Estate [Abstract] | |
REAL ESTATE ASSETS | NOTE 4 — REAL ESTATE ASSETS Property Acquisitions During the three months ended March 31, 2023 and 2022, the Company did not acquire any properties. Condominium Development Project During the three months ended March 31, 2023 and 2022, the Company capitalized $2.7 million and $3.1 million, respectively, of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets. Condominium Dispositions During the three months ended March 31, 2023, the Company disposed of one condominium unit for a sales price of $1.6 million, resulting in proceeds of $1.5 million after closing costs and a gain of $60,000. During the three months ended March 31, 2022, the Company disposed of condominium units for an aggregate sales price of $21.1 million, resulting in proceeds of $19.4 million after closing costs and a gain of $3.3 million. The Company has no continuing involvement that would preclude sale treatment with these condominium units. The gain on sale of condominium units is included in gain on disposition of real estate and condominium developments, net in the condensed consolidated statements of operations. 2023 Property Dispositions and Real Estate Assets Held for Sale On December 29, 2022, certain subsidiaries of the Company entered into an Agreement of Purchase and Sale (the “Realty Income Purchase and Sale Agreement”) with certain subsidiaries of Realty Income Corporation (NYSE: O) (“Realty Income”), to sell to Realty Income 185 single-tenant net lease properties encompassing approximately 4.6 million gross rentable square feet of commercial space across 34 states for total consideration of $894.0 million. The consideration is to be paid in cash. During the three months ended March 31, 2023, the Company disposed of 152 properties, including 150 retail properties and two industrial properties, for an aggregate gross sales price of $781.2 million, resulting in proceeds of $773.7 million after closing costs and a gain of $19.6 million. The sale of 151 of these properties closed pursuant to the Realty Income Purchase and Sale Agreement for total consideration of $779.0 million, resulting in proceeds of $771.5 million after closing costs and a gain of $19.5 million. The Company has no continuing involvement that would preclude sale treatment with these properties. The gain on sale of real estate is included in gain on disposition of real estate and condominium developments, net in the condensed consolidated statements of operations. As of March 31, 2023, the Company identified 27 properties with a fair value of $65.0 million as held for sale, all of which are in connection with the Realty Income Purchase and Sale Agreement. The Company disposed of these properties subsequent to March 31, 2023, as further discussed in Note 17 — Subsequent Events. 2022 Property Dispositions and Real Estate Assets Held for Sale On December 20, 2021, certain subsidiaries of the Company entered into an Agreement of Purchase and Sale, as amended (the “RTL Purchase and Sale Agreement”), with American Finance Trust, Inc. (now known as The Necessity Retail REIT, Inc.) (NASDAQ: RTL) (“RTL”), American Finance Operating Partnership, L.P. (now known as The Necessity Retail REIT Operating Partnership, L.P.) (“RTL OP”), and certain of their subsidiaries (collectively, the “Purchaser”) to sell to the Purchaser 79 shopping centers and two single-tenant properties encompassing approximately 9.5 million gross rentable square feet of commercial space across 27 states for total consideration of $1.32 billion (the “Purchase Price”). The Purchase Price includes the Purchaser’s option to seek the assumption of certain existing debt, and Purchaser’s issuance of up to $53.4 million in value of RTL’s Class A common stock, par value $0.01 per share (“RTL Common Stock”), or Class A units in RTL OP (“RTL OP Units”), subject to certain limits described more fully in the RTL Purchase and Sale Agreement. During the three months ended March 31, 2022, the Company disposed of 69 properties, including 32 retail properties and 37 anchored shopping centers, for an aggregate gross sales price of $925.3 million, resulting in proceeds of $923.2 million after closing costs and a gain of $29.2 million. The sale of 56 of these properties closed pursuant to the RTL Purchase and Sale Agreement for total consideration of $811.8 million, which consisted of $758.4 million in cash proceeds and $53.4 million of RTL Common Stock, which shares are subject to certain registration rights as described in the RTL Purchase and Sale Agreement. During the three months ended March 31, 2022, the Company recognized earnout income of $31.5 million related to the disposition of these properties pursuant to the RTL Purchase and Sale Agreement, and recorded a related receivable of $21.3 million in prepaid expenses and other assets in the condensed consolidated balance sheets. The Company has no continuing involvement with these properties. The gain on sale of real estate, including the earnout income, is included in gain on disposition of real estate and condominium developments, net in the condensed consolidated statements of operations. As of March 31, 2022, the Company identified 26 properties with a carrying value of $487.5 million as held for sale, 25 of which are in connection with the RTL Purchase and Sale Agreement. The Company disposed of these properties in phases subsequent to March 31, 2022. Impairment The Company performs quarterly impairment review procedures, primarily through continuous monitoring of events and changes in circumstances that could indicate that the carrying value of certain of its real estate assets may not be recoverable. See Note 2 — Summary of Significant Accounting Policies for a discussion of the Company’s accounting policies regarding impairment of real estate assets. During the three months ended March 31, 2023, one property totaling approximately 45,000 square feet with a carrying value of $9.6 million was deemed to be impaired and its carrying value was reduced to an estimated fair value of $4.8 million, resulting in impairment charges of $4.8 million, which were recorded in the condensed consolidated statements of operations. During the three months ended March 31, 2022, seven properties totaling approximately 215,000 square feet with a carrying value of $32.4 million were deemed to be impaired and their carrying values were reduced to an estimated fair value of $29.1 million, resulting in impairment charges of $3.3 million, which were recorded in the condensed consolidated statements of operations. See Note 3 — Fair Value Measurements for a further discussion regarding these impairment charges. |
INTANGIBLE LEASE ASSETS AND LIA
INTANGIBLE LEASE ASSETS AND LIABILITIES | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
INTANGIBLE LEASE ASSETS AND LIABILITIES | NOTE 5 — INTANGIBLE LEASE ASSETS AND LIABILITIES Intangible lease assets and liabilities consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands, except weighted average life remaining): March 31, 2023 December 31, 2022 Intangible lease assets: In-place leases and other intangibles, net of accumulated amortization of $46,214 and $86,881, respectively (with a weighted average life remaining of 11.7 years and 11.1 years, respectively) $ 110,887 $ 174,954 Acquired above-market leases, net of accumulated amortization of $2,773 and $4,210, respectively (with a weighted average life remaining of 11.7 years and 12.9 years, respectively) 4,262 10,639 Total intangible lease assets, net $ 115,149 $ 185,593 Intangible lease liabilities: Acquired below-market leases, net of accumulated amortization of $4,221 and $5,575, respectively (with a weighted average life remaining of 12.8 years and 12.4 years, respectively) $ 14,269 $ 19,054 Amortization of the above-market leases is recorded as a reduction to rental and other property income, and amortization expense for the in-place leases and other intangibles is included in depreciation and amortization in the accompanying condensed consolidated statements of operations. Amortization of below-market leases is recorded as an increase to rental and other property income in the accompanying condensed consolidated statements of operations. The following table summarizes the amortization related to the intangible lease assets and liabilities for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 2022 In-place lease and other intangible amortization $ 5,082 $ 6,786 Above-market lease amortization $ 234 $ 316 Below-market lease amortization $ 433 $ 579 As of March 31, 2023, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands): Amortization In-Place Leases and Above-Market Leases Below-Market Leases Remainder of 2023 $ 9,139 $ 348 $ 915 2024 11,694 424 1,126 2025 11,300 424 1,120 2026 10,092 379 1,120 2027 9,292 356 1,120 Thereafter 59,370 2,331 8,868 Total $ 110,887 $ 4,262 $ 14,269 |
INVESTMENT IN UNCONSOLIDATED EN
INVESTMENT IN UNCONSOLIDATED ENTITIES | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
INVESTMENT IN UNCONSOLIDATED ENTITIES | NOTE 6 — INVESTMENT IN UNCONSOLIDATED ENTITIES During the year ended December 31, 2021, the Company entered into the Unconsolidated Joint Venture, of which the Company owns 50% of the outstanding equity. The Unconsolidated Joint Venture holds approximately 90% of the membership interest in the NewPoint JV. Through the Unconsolidated Joint Venture, the Company has an approximate 45% interest in the NewPoint JV and accounts for its investment under the equity method. The primary purpose of the NewPoint JV is to source, underwrite, close and service on an ongoing basis multifamily bridge loans, participation interests, and other debt instruments such as loans. As of March 31, 2023, the carrying value of the Company’s investment in NP JV Holdings was $97.4 million, which approximates fair value and is included in investment in unconsolidated entities on the condensed consolidated balance sheets. The Company received $2.4 million in distributions related to its investment in NP JV Holdings during the three months ended March 31, 2023, all of which was recognized as a return of investment and reduced the invested capital and the carrying amount. As of March 31, 2023, the Company had $112.6 million of unfunded commitments related to NewPoint JV. These commitments are not reflected in the accompanying condensed consolidated balance sheets. The Company provided a limited guaranty to NewPoint JV, under which the Company agreed to guarantee the Unconsolidated Joint Venture’s cross indemnity and its share of capital contribution obligations under the agreement with NewPoint JV. |
REAL ESTATE-RELATED SECURITIES
REAL ESTATE-RELATED SECURITIES | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
REAL ESTATE-RELATED SECURITIES | NOTE 7 — REAL ESTATE-RELATED SECURITIES As of March 31, 2023, the Company had real estate-related securities with an aggregate estimated fair value of $520.6 million, which included 18 CMBS investments and an investment in a publicly-traded equity security. The CMBS mature on various dates from July 2023 through June 2058 and have interest rates ranging from 6.2% to 12.2% as of March 31, 2023, with one CMBS earning a zero coupon rate. The following is a summary of the Company’s real estate-related securities as of March 31, 2023 (in thousands): Real Estate-Related Securities Amortized Cost Basis Unrealized Loss Fair Value CMBS $ 554,950 $ (74,817) $ 480,133 Equity security 53,388 (12,882) 40,506 Total real estate-related securities $ 608,338 $ (87,699) $ 520,639 The following table provides the activity for the real estate-related securities during the three months ended March 31, 2023 (in thousands): Amortized Cost Basis Unrealized Loss Fair Value Real estate-related securities as of January 1, 2023 $ 640,037 $ (63,646) $ 576,391 Face value of real estate-related securities acquired 9,738 — 9,738 Premiums and discounts on purchase of real estate-related securities, net of acquisition costs (336) — (336) Amortization of discount on real estate-related securities 7,590 — 7,590 Capitalized interest income on real estate-related securities 284 — 284 Principal payments received on real estate-related securities (1) (48,975) — (48,975) Unrealized loss on real estate-related securities — (24,053) (24,053) Real estate-related securities as of March 31, 2023 $ 608,338 $ (87,699) $ 520,639 ____________________________________ (1) Includes the repayment of the Company’s position in two different tranches of a CMBS instrument prior to their stated maturity dates. During the three months ended March 31, 2023, the Company invested $9.4 million in CMBS. Unrealized gains and losses on CMBS are recorded in other comprehensive loss, with a portion of the amount subsequently reclassified into other income, net in the accompanying condensed consolidated statements of operations as securities are sold and gains and losses are recognized. Unrealized gains and losses on the equity security are reported on the condensed consolidated statements of operations. During the three months ended March 31, 2023, the Company recorded $26.3 million of unrealized loss on its CMBS, which is included in other comprehensive loss in the accompanying condensed consolidated statements of comprehensive income, and recorded $2.3 million of unrealized gain on the Company’s equity security, which is included in unrealized gain (loss) on equity security in the accompanying condensed consolidated statements of operations. The scheduled maturities of the Company’s CMBS as of March 31, 2023 are as follows (in thousands): CMBS Amortized Cost Estimated Fair Value Due within one year $ 364,798 $ 312,595 Due after one year through five years 148,125 136,452 Due after five years through ten years — — Due after ten years 42,027 31,086 Total $ 554,950 $ 480,133 Actual maturities of real estate-related securities can differ from contractual maturities because borrowers on certain corporate credit securities may have the right to prepay their respective debt obligations at any time. In addition, factors such as prepayments and interest rates may affect the yields on such securities. In estimating credit losses related to real estate-related securities, management considers a variety of factors, including, but not limited to, the extent to which the fair value is less than the amortized cost basis, recent events specific to the security, industry or geographic area, the payment structure of the security, the failure of the issuer of the security to make scheduled interest or principal payments, and external credit ratings and recent changes in such ratings. As of March 31, 2023, the Company had no credit losses related to real estate-related securities. |
LOANS HELD-FOR-INVESTMENT
LOANS HELD-FOR-INVESTMENT | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
LOANS HELD-FOR-INVESTMENT | NOTE 8 — LOANS HELD-FOR-INVESTMENT The Company’s loans held-for-investment consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands): As of March 31, As of December 31, 2023 2022 First mortgage loans (1) $ 3,198,651 $ 3,285,193 Total CRE loans held-for-investment and related receivables, net 3,198,651 3,285,193 Liquid corporate senior loans 703,866 701,540 Corporate senior loans 73,799 57,165 Loans held-for-investment and related receivables, net $ 3,976,316 $ 4,043,898 Less: Current expected credit losses $ (43,779) $ (42,344) Total loans held-for-investment and related receivable, net $ 3,932,537 $ 4,001,554 ____________________________________ (1) As of March 31, 2023, first mortgage loans included $20.1 million of contiguous mezzanine loan components that, as a whole, have expected credit quality similar to that of a first mortgage loan. The following table details overall statistics for the Company’s loans held-for-investment as of March 31, 2023 and December 31, 2022 (dollar amounts in thousands): CRE Loans (1) (2) Liquid Corporate Senior Loans Corporate Senior Loans March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022 Number of loans 28 29 315 317 6 4 Principal balance $ 3,216,545 $ 3,306,411 $ 710,334 $ 708,254 $ 74,917 $ 57,918 Net book value $ 3,176,350 $ 3,264,841 $ 683,585 $ 680,345 $ 72,602 $ 56,368 Weighted-average interest rate 8.0 % 7.6 % 8.5 % 8.0 % 11.3 % 10.5 % Weighted-average maximum years to maturity 3.4 3.6 4.6 4.7 4.4 4.6 Unfunded loan commitments (3) $ 287,515 $ 304,649 $ 1,425 $ 1,425 $ 3,794 $ 4,324 ____________________________________ (1) As of March 31, 2023, 100% of the Company’s CRE loans by principal balance earned a floating rate of interest, primarily indexed to SOFR and U.S. dollar LIBOR. (2) Maximum maturity date assumes all extension options are exercised by the borrowers; however, the Company’s CRE loans may be repaid prior to such date. (3) Unfunded loan commitments are subject to the satisfaction of borrower milestones and are not reflected in the accompanying condensed consolidated balance sheets. This balance does not include unsettled liquid corporate senior loan purchases of $18.0 million that are included in cash and cash equivalents in the accompanying condensed consolidated balance sheets. Activity relating to the Company’s loans held-for-investment portfolio was as follows (in thousands): CRE Loans Liquid Corporate Senior Loans Corporate Senior Loans Total Loan Portfolio Balance, January 1, 2023 $ 3,264,841 $ 680,345 $ 56,368 $ 4,001,554 Loan originations and acquisitions 17,007 27,521 17,182 61,710 Sale of loans — (8,311) — (8,311) Principal repayments received (1) (106,873) (16,940) (183) (123,996) Deferred fees and other items (2) — (780) (420) (1,200) Accretion and amortization of fees and other items 3,324 836 55 4,215 Current expected credit losses (3) (1,949) 914 (400) (1,435) Balance, March 31, 2023 $ 3,176,350 $ 683,585 $ 72,602 $ 3,932,537 ____________________________________ (1) Includes the repayment of a $105.0 million first mortgage loan prior to the maturity date. (2) Other items primarily consist of purchase discounts or premiums and deferred origination expenses. (3) Does not include current expected losses for unfunded or unsettled loan commitments. Such amounts are included in accrued expenses and accounts payable on the accompanying condensed consolidated balance sheets. Current Expected Credit Losses Current expected credit losses reflect the Company’s current estimate of potential credit losses related to loans held-for-investment included in the Company’s condensed consolidated balance sheets. Refer to Note 2 — Summary of Significant Accounting Policies for further discussion of the Company’s current expected credit losses. The following table presents the activity in the Company’s current expected credit losses related to loans held-for-investment by loan type for the three months ended March 31, 2023 (in thousands): First Mortgage Loans Unfunded First Mortgage Loans (1) Liquid Corporate Senior Loans Unfunded or Unsettled Liquid Corporate Senior Loans (1) Corporate Senior Loans Unfunded Corporate Senior Loans (1) Total Current expected credit losses as of January 1, 2023 $ 20,352 $ 1,890 $ 21,195 $ 377 $ 797 $ 66 $ 44,677 Provision for (reversal of) credit losses 1,949 138 (914) (121) 400 1 1,453 Current expected credit losses as of March 31, 2023 $ 22,301 $ 2,028 $ 20,281 $ 256 $ 1,197 $ 67 $ 46,130 ____________________________________ (1) Current expected losses for unfunded or unsettled loan commitments are included in accrued expenses and accounts payable on the condensed consolidated balance sheets. Changes to current expected credit losses are recognized through net income on the Company’s condensed consolidated statements of operations. Risk Ratings As further described in Note 2 — Summary of Significant Accounting Policies, the Company evaluates its loans held-for-investment portfolio on a quarterly basis. Each quarter, the Company assesses the risk factors of each loan, and assigns a risk rating based on several factors. Factors considered in the assessment include, but are not limited to, loan and credit structure, current LTV ratio, debt yield, collateral performance, and the quality and condition of the sponsor, borrower, and guarantor(s). Loans are rated “1” (less risk) through “5” (greater risk), which ratings are defined in Note 2 — Summary of Significant Accounting Policies. The Company’s primary credit quality indicator is its risk ratings, which are further discussed above. The following table presents the net book value of the Company’s loans held-for-investment portfolio as of March 31, 2023 by year of origination, loan type, and risk rating (dollar amounts in thousands): Amortized Cost of Loans Held-For-Investment by Year of Origination (1) As of March 31, 2023 Number of Loans 2023 2022 2021 2020 2019 Total First mortgage loans by internal risk rating: 1 — $ — $ — $ — $ — $ — $ — 2 1 — — — 87,702 — 87,702 3 24 — 1,167,412 1,509,502 72,804 49,509 2,799,227 4 3 — 80,467 231,255 — — 311,722 5 — — — — — — — Total first mortgage loans 28 — 1,247,879 1,740,757 160,506 49,509 3,198,651 Liquid corporate senior loans by internal risk rating: 1 — — — — — — — 2 2 — — — 5,285 — 5,285 3 303 17,033 127,230 371,650 159,915 2,317 678,145 4 9 — 3,248 6,240 8,029 — 17,517 5 1 (2) — 2,919 — — — 2,919 Total liquid corporate senior loans 315 17,033 133,397 377,890 173,229 2,317 703,866 Corporate senior loans by internal risk rating: 1 — — — — — — — 2 — — — — — — — 3 6 16,248 57,551 — — — 73,799 4 — — — — — — — 5 — — — — — — — Total corporate senior loans 6 16,248 57,551 — — — 73,799 Less: Current expected credit losses (43,779) Total loans held-for-investment and related receivables, net 349 $ 3,932,537 Weighted Average Risk Rating (3) 3.1 ____________________________________ (1) Date loan was originated or acquired by the Company. Origination dates are subsequently updated to reflect material loan modifications. (2) As of March 31, 2023, one of the Company’s liquid corporate senior loan investments was on nonaccrual status with a carrying value of $2.9 million, which represented less than 1% of the carrying value of the Company’s liquid corporate senior loans portfolio. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | NOTE 9 — DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES In the normal course of business, the Company uses certain types of derivative instruments for the purpose of managing or hedging its interest rate risk. As of March 31, 2023, the Company had two non-designated interest rate cap agreements. The following table summarizes the terms of the Company’s interest rate cap agreements as of March 31, 2023 and December 31, 2022 (dollar amounts in thousands): Outstanding Notional Fair Value of Assets as of Balance Sheet Amount as of Strike Effective Maturity March 31, December 31, Location March 31, 2023 Rates Dates Dates 2023 2022 Interest Rate Caps Derivative assets, prepaid expenses and other assets $ 712,000 3.50% (1) to 4.00% (2) 7/15/2021 to 9/13/2022 7/15/2023 to 10/9/2023 $ 3,080 $ 5,040 ____________________________________ (1) The index used for this derivative instrument is 1-Month LIBOR. (2) The index used for this derivative instrument is 1-Month Term SOFR. Additional disclosures related to the fair value of the Company’s derivative instruments are included in Note 3 — Fair Value Measurements. The notional amount under the derivative instruments is an indication of the extent of the Company’s involvement in each instrument, but does not represent exposure to credit, interest rate or market risks. Accounting for changes in the fair value of a derivative instrument depends on the intended use and designation of the derivative instrument. The Company has interest rate caps that are used to manage exposure to interest rate movements, but do not meet the requirements to be designated as hedging instruments. The change in fair value of the derivative instruments that are not designated as hedges is recorded directly to earnings in other income, net on the accompanying condensed consolidated statements of operations. Interest rate swaps are designated as cash flow hedges in order to hedge the variability of the anticipated cash flows on the Company’s variable rate debt. The change in fair value of the derivative instruments designated as hedges is recorded in other comprehensive loss, with a portion of the amount subsequently reclassified to interest expense as interest payments are made on the Company’s variable rate debt. During the year ended December 31, 2022, two of the Company’s interest rate swap agreements matured and three interest rate swap agreements were terminated prior to the maturity dates. For the three months ended March 31, 2023, no amounts were reclassified from other comprehensive loss as a change to interest expense. For the three months ended March 31, 2022, the amount of gain reclassified from other comprehensive loss as a decrease to interest expense was $7,000. The total unrealized gain on interest rate swaps of $1.6 million as of March 31, 2022 is included in accumulated other comprehensive loss in the accompanying condensed consolidated statements of stockholders’ equity. No such unrealized amounts on interest rate swaps were remaining in other comprehensive loss as of March 31, 2023. The Company includes cash flows from interest rate swap agreements in net cash flows provided by operating activities on its condensed consolidated statements of cash flows, as the Company’s accounting policy is to present cash flows from hedging instruments in the same category in its condensed consolidated statements of cash flows as the category for cash flows from the hedged items. The Company has agreements with each of its derivative counterparties that contain provisions whereby if the Company defaults on certain of its unsecured indebtedness, the Company could also be declared in default on its derivative obligations, resulting in an acceleration of payment. If the Company had breached any of these provisions, it could have been required to settle its obligations under the agreements at their aggregate termination value, inclusive of interest payments and accrued interest. In addition, the Company is exposed to credit risk in the event of non-performance by its derivative counterparties. The Company believes it mitigates its credit risk by entering into agreements with creditworthy counterparties. The Company records credit risk valuation adjustments on its derivative instruments based on the credit quality of the Company and the respective counterparty. There were no events of default related to the derivative instruments as of March 31, 2023. |
REPURCHASE FACILITIES, NOTES PA
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES | NOTE 10 — REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES As of March 31, 2023, the Company had $4.0 billion of debt outstanding, including net deferred financing costs, with a weighted average years to maturity of 3.5 years and a weighted average interest rate of 5.9%. The weighted average years to maturity is computed using the scheduled repayment date as specified in each loan agreement where applicable. The weighted average interest rate is computed using the interest rate in effect until the scheduled repayment date. The following table summarizes the debt balances as of March 31, 2023 and December 31, 2022, and the debt activity for the three months ended March 31, 2023 (in thousands): During the Three Months Ended March 31, 2023 Balance as of December 31, 2022 Debt Issuances & Assumptions (1) Repayments & Modifications (2) Amortization Balance as of Notes payable – fixed rate debt $ 36,538 $ — $ (36,538) $ — $ — Notes payable – variable rate debt 465,517 1,112 (5,569) — 461,060 First lien mortgage loan 121,940 — (121,940) — — ABS mortgage notes 763,035 — (1,935) — 761,100 Credit facilities 738,500 35,000 (240,000) — 533,500 Repurchase facilities 2,318,381 17,163 (111,796) — 2,223,748 Total debt 4,443,911 53,275 (517,778) — 3,979,408 Deferred costs – credit facility (3) (740) — 679 (4) 61 — Deferred costs – fixed rate debt and first lien mortgage loan (1,109) — 702 (4) 407 — Deferred costs – variable rate debt (5,261) (40) 602 (4) 488 (4,211) Deferred costs – ABS mortgage notes (13,968) (493) — 477 (13,984) Total debt, net $ 4,422,833 $ 52,742 $ (515,795) $ 1,433 $ 3,961,213 ____________________________________ (1) Includes deferred financing costs incurred during the period. (2) In connection with the repayment of certain mortgage notes and the termination of the CMFT Credit Facility, the Company recognized a loss on extinguishment of debt of $3.6 million during the three months ended March 31, 2023, which included $1.3 million in prepayment penalties. (3) Deferred costs related to the term portion of the CMFT Credit Facility (defined below). (4) In connection with the repayment of certain mortgage notes and the termination of the CMFT Credit Facility, the Company wrote off approximately $2.0 million of unamortized deferred loan costs. Notes Payable During the three months ended March 31, 2023, the Company legally defeased a mortgage loan with an outstanding balance of $23.7 million, resulting in a $205,000 loss on extinguishment of debt in the Company’s condensed consolidated statement of operations during the three months ended March 31, 2023, and repaid the remaining $12.8 million of fixed rate debt outstanding, both in connection with the disposition of the underlying properties securing the fixed rate debt. As of March 31, 2023, the Company had $461.1 million of variable rate debt outstanding, which included $423.5 million of borrowings financed through a note on note financing arrangement with Massachusetts Mutual Life Insurance Company (the “Mass Mutual Financing”). In addition, upon completing foreclosure proceedings to take control of the assets which previously secured the Company’s mezzanine loans in January 2021, the Company assumed $102.6 million in variable rate debt related to the underlying properties (the “Assumed Variable Rate Debt”), which the Company subsequently refinanced and paid down the outstanding balance during the year ended December 31, 2022. The amended borrowing agreement related to the refinanced Assumed Variable Rate Debt provides for borrowings up to $62.0 million. As of March 31, 2023, the amount outstanding on the refinanced Assumed Variable Rate Debt totaled $37.6 million. The Company’s outstanding variable rate debt had a weighted average interest rate of 7.2% as of March 31, 2023, and matures on various dates from October 2024 to January 2028. First Lien Mortgage Loan On July 15, 2021, JPMorgan Chase Bank, N.A., as administrative agent (“JPMorgan Chase”), and DBR Investments Co. Limited originated a $650.0 million first lien mortgage loan (the “Mortgage Loan”) to 114 single purpose entities, each of which is an affiliate of the Company and is managed on a day-to-day basis by affiliates of CIM. During the three months ended March 31, 2023, the Company paid down the $121.9 million outstanding balance on the Mortgage Loan, $105.8 million of which was in connection with the sale of properties pursuant to the Realty Income Purchase and Sale Agreement. Refer to Note 4 — Real Estate Assets for additional information regarding the sale. ABS Mortgage Notes On July 28, 2021, the Company issued $774.0 million aggregate principal amount of asset backed securities (“ABS”) mortgage notes, Series 2021-1 (the “Class A Notes”) in six classes, as shown below: Class of Notes Initial Principal Balance Note Rate Anticipated Repayment Date Rated Final Payment Date Credit Rating (1) A-1 (AAA) $ 146,400,000 2.09% July 2028 July 2051 AAA (sf) A-2 (AAA) $ 219,600,000 2.57% July 2031 July 2051 AAA (sf) A-3 (AA) $ 39,200,000 2.51% July 2028 July 2051 AA (sf) A-4 (AA) $ 58,800,000 3.04% July 2031 July 2051 AA (sf) A-5 (A) $ 124,000,000 2.91% July 2028 July 2051 A (sf) A-6 (A) $ 186,000,000 3.44% July 2031 July 2051 A (sf) ____________________________________ (1) Reflects credit rating from Standard & Poor’s Financial Services LLC (“Standard & Poor’s”). The collateral pool for the Class A Notes is comprised of 175 of the Company’s double- and triple-net leased single tenant properties, together with the related leases and certain other rights and interests. The aggregate balance of gross real estate assets, net of gross intangible lease liabilities, securing the Class A Notes was $963.8 million. As of March 31, 2023, amounts outstanding on the Class A Notes totaled $761.1 million with a weighted average interest rate of 2.8%. The Company may prepay the Class A Notes in full on or after the payment date beginning in July 2026 for the Class A-1 (AAA) Notes, the Class A-3 (AA) Notes and the Class A-5 (A) Notes, and on or after the payment date in July 2028 for the Class A-2 (AAA) Notes, the Class A-4 (AA) Notes and the Class A-6 (A) Notes. Credit Facilities During the three months ended March 31, 2023, CMFT CL Lending Sub AB, LLC (the “Borrower”), an indirect wholly owned subsidiary of the Company, entered into a revolving loan and security agreement (the “Loan and Security Agreement”) with each of the lenders from time to time party thereto (the “Lenders”), Ally Bank as administrative agent and arranger (“Ally Bank”), U.S. Bank Trust Company, National Association, as the collateral custodian, and U.S. Bank National Association as the document custodian, which provides for borrowings in an aggregate principal amount up to $300.0 million (the “Loan Facility”), which may be increased during the revolving period (as defined below) to an aggregate principal amount up to $500.0 million as agreed to by the Borrower, any applicable Lender and Ally Bank. Borrowings under the Loan and Security Agreement will bear interest equal to SOFR for the relevant interest period, plus an applicable rate. The applicable rate is 2.875% per annum (and an additional 2.00% per annum following an event of default under the Loan and Security Agreement). The revolving period begins on February 10, 2023 and concludes on the day preceding the earlier to occur of (i) the scheduled revolving period end date of February 10, 2026, (ii) the date of the declaration of the revolving period end date upon the occurrence and continuation of an event of default, and (iii) the termination date. The termination date is the earlier to occur of (i) February 10, 2028 (two years after the revolving period end date) and (ii) the date of the declaration of the termination date or the date of the automatic occurrence of the termination date upon the occurrence and continuation of an event of default. As of March 31, 2023, no amounts were borrowed and outstanding under the Loan Facility. The Company had a credit agreement with the lenders from time to time parties thereto, JPMorgan Chase, as administrative agent, letter of credit issuer and syndication agent, and PNC Bank, N.A., as syndication agent, that provided for borrowings in the initial amount of $300.0 million (the “CMFT Credit Facility”). The CMFT Credit Facility was set to mature on July 15, 2025. During the three months ended March 31, 2023, the Company paid down the $240.0 million outstanding balance under the CMFT Credit Facility and terminated the CMFT Credit Facility. CMFT Corporate Credit Securities, LLC, an indirect wholly-owned, bankruptcy-remote subsidiary of the Company, has a revolving credit and security agreement (the “Third Amended Credit and Security Agreement”) with the lenders from time to time parties thereto, Citibank, N.A. (“Citibank”), as administrative agent, CMFT Securities Investments, LLC, a wholly-owned subsidiary of the Company (“CMFT Securities”), as equityholder and as collateral manager, Citibank (acting through its Agency & Trust division), as both a collateral agent and as a collateral custodian, and Virtus Group, LP, as collateral administrator. The Third Amended Credit and Security Agreement provides for available borrowings under the revolving credit facility to an aggregate principal amount up to $550.0 million (the “Credit Securities Revolver”). The Credit Securities Revolver may be increased from time to time pursuant to the Third Amended Credit and Security Agreement. As of March 31, 2023, the amounts borrowed and outstanding under the Credit Securities Revolver totaled $533.5 million at a weighted average interest rate of 7.0%. Borrowings under the Third Amended Credit and Security Agreement will bear interest equal to the one-month Term SOFR (as defined in the Third Amended Credit and Security Agreement) for the relevant interest period, plus an applicable rate. The applicable rate is dependent on the type of loan being financed, which includes broadly syndicated, private and middle market loans meeting certain criteria as set forth in the Third Amended Credit and Security Agreement and ranges from 1.90% to 2.75% per annum during the first two years of the reinvestment period and 2.00% to 2.85% during the last year of the reinvestment period and 2.10% to 2.95% per annum during the amortization period (and, in each case, an additional 2.00% per annum following an event of default under the Third Amended Credit and Security Agreement). The reinvestment period began on December 31, 2019 and concludes on the earlier of (i) the date that is three years after June 23, 2022, the date the third amendment became effective, (ii) the final maturity date and (iii) the date on which the total assets under management of the Company and its wholly-owned subsidiaries is less than $1.25 billion (the “Reinvestment Period”). The final maturity date is the earliest to occur of: (i) the date that the Credit Securities Revolver is paid down and (ii) the second anniversary after the Reinvestment Period concludes. Borrowings under the Third Amended Credit and Security Agreement are secured by substantially all of the assets held by CMFT Corporate Credit Securities, LLC, which shall primarily consist of liquid corporate senior secured loans subject to certain eligibility criteria under the Third Amended Credit and Security Agreement. The Company believes it was in compliance with the financial covenants under the Company’s various fixed and variable rate debt agreements, as of March 31, 2023. Repurchase Facilities As of March 31, 2023, indirect wholly-owned subsidiaries of the Company (collectively, the “CMFT Lending Subs”), had Master Repurchase Agreements with Citibank, Barclays, Wells Fargo Bank, N.A. (“Wells Fargo”), Deutsche Bank AG (“Deutsche Bank”), and J.P. Morgan Securities LLC (“J.P. Morgan”) (collectively, the “Repurchase Agreements”) to provide financing primarily through each bank’s purchase of the Company’s CRE mortgage loans and CMBS and future funding advances (the “Repurchase Facilities”). The following table is a summary of the Repurchase Facilities as of March 31, 2023 (dollar amounts in thousands): Repurchase Facility Date of Agreement Maturity Date (1) Maximum Facility Size Weighted Average Interest Rate Loans Financed under Repurchase Facility (2) Amount Financed Citibank 6/4/2020 8/17/2024 $ 400,000 6.5% (3) $ 468,204 $ 336,035 Barclays 9/21/2020 9/22/2025 1,250,000 6.6% (3) 1,097,301 806,317 Wells Fargo 5/20/2021 8/30/2025 750,000 6.4% (3) 898,108 696,712 Deutsche Bank 10/8/2021 10/8/2023 300,000 7.1% (3) 196,194 148,863 J.P. Morgan 6/1/2022 4/3/2023 (4) — (4) 5.9% (5) 416,242 235,821 Total $ 2,700,000 $ 3,076,049 $ 2,223,748 __________________________________ (1) As of March 31, 2023, the repurchase facility with Citibank and Wells Fargo each have two one-year extension options remaining, the repurchase facility with Barclays has one one-year extension option remaining and the repurchase facility with Deutsche Bank has four one-year extension options remaining. All repurchase facilities are subject to certain conditions set forth in their respective Repurchase Agreements. (2) CRE mortgage loan balances financed under the Repurchase Facilities with Citibank, Barclays, Wells Fargo and Deutsche Bank reflect the aggregate outstanding principal balance while the CMBS balance financed under the J.P. Morgan Repurchase Facility reflects fair value. (3) Advances under the Repurchase Agreements accrue interest at per annum rates based on the one-month LIBOR, Term SOFR (as such term is defined in the applicable Repurchase Agreement) or the daily compounded SOFR plus a spread ranging from 1.30% to 2.85% to be determined on a case-by-case basis between Citibank, Barclays,Wells Fargo or Deutsche Bank and the CMFT Lending Subs. (4) Facilities under the repurchase facility with J.P. Morgan (“J.P. Morgan Repurchase Facility”) carry a rolling term which is reset monthly. Such facilities carry no maximum facility size. (5) Under the Master Repurchase Agreement with J.P. Morgan, advances under the repurchase agreement may be made based on one-month Term SOFR plus a spread designated by J.P. Morgan, which as of March 31, 2023, ranges from 0.95% to 1.35%. The Repurchase Agreements provide for simultaneous agreements by Citibank, Barclays, Wells Fargo, Deutsche Bank and J.P. Morgan to re-sell such purchased CRE mortgage loans and CMBS back to CMFT Lending Subs at a certain future date or upon demand. In connection with certain of the Repurchase Agreements, the Company (as the guarantor) entered into guaranties with Citibank, Barclays, Wells Fargo, and Deutsche Bank (the “Guaranties”), under which the Company agreed to guarantee up to 25% of the CMFT Lending Subs’ obligations under certain Repurchase Agreements. The Repurchase Agreements and the Guaranties contain representations, warranties, covenants, conditions precedent to funding, events of default and indemnities that are customary for agreements of these types. In addition, the Guaranties contain financial covenants that require the Company to maintain: (i) minimum liquidity of not less than the lower of (a) $50.0 million and (b) the greater of (A) $10.0 million and (B) 5% of the Company’s recourse indebtedness, as defined in the Guaranties; (ii) minimum consolidated net worth greater than or equal to $1.0 billion plus (a) 75% of the equity issued by the Company following the respective closing dates of the Repurchase Agreements (the “Repurchase Closing Dates”) minus (b) the aggregate amount of any redemptions or similar transaction by the Company from the Repurchase Closing Dates; (iii) maximum leverage ratio of total indebtedness to total equity less than or equal to 80%; and (iv) minimum interest coverage ratio of EBITDA (as defined in the Guaranties) to interest expense equal to or greater than 1.40. The Company believes it was in compliance with the financial covenants under the Repurchase Agreements as of March 31, 2023. Maturities The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to March 31, 2023 (in thousands): Principal Repayments Remainder of 2023 $ 387,264 2024 373,576 2025 1,503,029 2026 — 2027 911,179 Thereafter 804,360 Total $ 3,979,408 |
COMMITMENTS AND CONTINGENCIES
COMMITMENTS AND CONTINGENCIES | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | NOTE 11 — COMMITMENTS AND CONTINGENCIES Litigation In the ordinary course of business, the Company may become subject to litigation and claims. The Company is not aware of any material pending legal proceedings, other than ordinary routine litigation incidental to the Company’s business, to which the Company is a party or of which the Company’s properties are the subject. Unfunded Commitments As of March 31, 2023, the Company had $292.7 million of unfunded loan commitments related to its existing CRE loans held-for-investment, corporate senior loans, and liquid corporate senior loans, and $112.6 million of unfunded commitments related to NewPoint JV. These commitments are not reflected in the accompanying condensed consolidated balance sheet. As of March 31, 2023, the Company had $18.0 million of unsettled liquid corporate senior loan acquisitions, $13.0 million of which settled subsequent to March 31, 2023. Unsettled acquisitions are included in cash and cash equivalents in the accompanying condensed consolidated balance sheet. |
RELATED-PARTY TRANSACTIONS AND
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS | NOTE 12 — RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS The Company has incurred fees and expenses payable to CMFT Management and certain of its affiliates in connection with the acquisition, management and disposition of its assets. On March 24, 2023, the Company and CMFT Management entered into the second amended and restated management agreement (the “Management Agreement”), which amended and restated the amended and restated management agreement between the parties dated August 20, 2019. Management and investment advisory fees The Company pays CMFT Management a management fee, payable quarterly in arrears, equal to the greater of (a) $250,000 per annum ($62,500 per quarter) and (b) 1.50% per annum (0.375% per quarter) of the Company’s Equity (as defined in the Management Agreement). CMFT Securities has an investment advisory and management agreement dated December 6, 2019 (the “Investment Advisory and Management Agreement”) with the Investment Advisor. CMFT Securities was formed for the purpose of holding any securities investments and certain other investments made by the Company. The Investment Advisor, a wholly-owned subsidiary of CIM Group, is registered as an investment advisor under the Investment Advisers Act of 1940, as amended (the “Advisers Act”). Pursuant to the Investment Advisory and Management Agreement, the Investment Advisor manages the day-to-day business affairs of CMFT Securities and its investments in corporate credit and real estate-related securities (collectively, the “Managed Assets”), subject to the supervision of the Board. In connection with the services provided by the Investment Advisor, CMFT Securities pays the Investment Advisor an investment advisory fee (the “Investment Advisory Fee”), payable quarterly in arrears, equal to 1.50% per annum (0.375% per quarter) of CMFT Securities’ Equity (as defined in the Investment Advisory and Management Agreement). Because the Managed Assets are excluded from the calculation of management fees payable by the Company to CMFT Management pursuant to the Management Agreement, the total management and advisory fees payable by the Company to its external advisors are not increased as a result of the Investment Advisory and Management Agreement. In addition, the Investment Advisor has a sub-advisory agreement dated December 6, 2019 (the “Sub-Advisory Agreement”) with OFS Capital Management, LLC (the “Sub-Advisor”) to act as an investment sub-advisor to CMFT Securities. The Sub-Advisor is registered as an investment adviser under the Advisers Act and is an affiliate of the Investment Advisor. The Sub-Advisor principally provides investment management services with respect to the corporate credit-related securities held by CMFT Securities and its subsidiaries. The Sub-Advisor may allocate a portion of these corporate credit-related securities to its other clients, including affiliates of CIM Group. On a quarterly basis, the Investment Advisor designates 50% of the sum of the Investment Advisory Fee and incentive compensation attributable to the assets for which the Sub-Advisor has provided investment management services payable to the Investment Advisor as sub-advisory fees. Incentive compensation CMFT Management is entitled to receive incentive compensation, payable with respect to each quarter, which is generally equal to the excess of (a) the product of (i) 20% and (ii) the excess of (A) Core Earnings (as defined in the Management Agreement) of the Company for the previous 12-month period, over (B) the product of (1) the Company’s Consolidated Equity (as defined in the Management Agreement) in the previous 12-month period, and (2) 7% per annum, over (b) the sum of any incentive compensation paid to CMFT Management with respect to the first three calendar quarters of such previous 12-month period (or such lesser number of completed calendar quarters preceding the applicable period, if applicable). During the three months ended March 31, 2023 and 2022, no incentive compensation fees were incurred. In addition, the Investment Advisor is eligible to receive a portion of the incentive compensation payable to CMFT Management pursuant to the Management Agreement. In the event that the incentive compensation is earned and payable with respect to any quarter, CMFT Management calculates the portion of the incentive compensation that was attributable to the Managed Assets and payable to the Investment Advisor. Expense reimbursements to related parties The Company reimburses CMFT Management, the Investment Advisor or their affiliates for certain expenses paid or incurred in connection with the services provided to the Company. The Company will reimburse CMFT Management, the Investment Advisor, or their affiliates for salaries and benefits paid to personnel who provide services to the Company, excluding the Company’s executive officers and any portfolio management, acquisitions or investment professionals. The Company recorded fees and expense reimbursements as shown in the table below for services provided by CMFT Management or its affiliates related to the services described above during the periods indicated (in thousands): Three Months Ended March 31, 2023 2022 Management fees $ 12,579 $ 13,347 Expense reimbursements to related parties $ 3,568 $ 3,694 Due to Affiliates Of the amounts shown above, $13.8 million and $16.1 million had been incurred, but not yet paid, for services provided by CMFT Management or its affiliates in connection with the management and operating activities during the three months ended March 31, 2023 and 2022, respectively, and such amounts were recorded as liabilities of the Company as of such dates. Development Management Agreements On January 7, 2021, the Company completed foreclosure proceedings to take control of the assets which previously secured its mezzanine loans, including 75 condominium units and 21 rental units across four buildings in New York. Upon foreclosure, and with the approval of the Board’s former valuation, compensation and affiliate transactions committee, CIM NY Management, LLC, an affiliate of the Company’s manager, CMFT Management, entered into a Development Management Agreement with the indirect wholly owned subsidiaries of the Company that own each of the four buildings (the “Building Owners”), wherein CIM NY Management, LLC will act as project manager in overseeing the development and construction of property improvements in accordance with each respective Development Management Agreement (the “Development Services”). In consideration for the Development Services, CIM NY Management, LLC will receive a development management fee from the Building Owners equal to 4% of the aggregate gross project costs expended during the term of the Development Management Agreement, subject to the conditions in each respective Development Management Agreement. During the three months ended March 31, 2023 and 2022, the Company recorded $76,000 and $130,000, respectively, in development management fees. Additionally, CIM NY Management, LLC is reimbursed by the Building Owners for expenses incurred in connection with the Development Services, including services provided that are incidental to but not part of the Development Services. The Development Management Agreement shall remain in effect until the project completion date, and is terminable by either party with fifteen days prior notice to the other party, with or without cause. Affiliated Investments In September 2021, the Company co-invested $68.4 million in preferred units and $138.8 million in a first mortgage loan to a third-party for the purchase of a multi-family, office and retail building in Fort Lauderdale, Florida with CIM Real Assets & Credit Fund, a fund that is advised by affiliates of CMFT Management (“CIM RACR”). The Company redeemed its investment in the preferred units during the year ended December 31, 2022 in exchange for an investment in a first mortgage loan. As of March 31, 2023, $203.6 million of the first mortgage loan was outstanding. In October 2021, the Company invested in a $130.0 million first mortgage loan, with an initial advance of $119.0 million, to a third-party, the proceeds of which were used to finance the acquisition of a property from a fund that is advised by an affiliate of CMFT Management. As of March 31, 2023, $123.0 million of the first mortgage loan was outstanding. In November 2021, the Company entered into the Unconsolidated Joint Venture (the “MT-FT JV”) with CMMT Holdings, LLC, a fund that is advised by an affiliate of CMFT Management (“CMMT”), for the purposes of investing in the NewPoint JV. The Company owns 50% of the equity interests of the MT-FT JV and has committed to fund capital to the MT-FT JV up to $212.5 million, of which $99.9 million has been funded, net of $39.9 million returned as a return of capital that can be called back by NewPoint JV through NP JV Holdings as a capital call on a future date. For more information on the NewPoint JV, see Note 2 — Summary of Significant Accounting Policies. In December 2021, the Company invested in a $155.0 million first mortgage loan, with an initial advance of $154.0 million, to a third-party, the proceeds of which were used to finance the acquisition of a property from a fund that is advised by an affiliate of CMFT Management. As of March 31, 2023, $154.0 million of the first mortgage loan was outstanding. In April 2022, the Company invested in a $147.0 million first mortgage loan, with an initial advance of $143.0 million, to a third-party, which was previously funded by a fund that is advised by an affiliate of CMFT Management. As of March 31, 2023, $145.5 million of the first mortgage loan was outstanding. During the year ended December 31, 2022, the Company and CIM RACR co-invested $75.9 million and $14.7 million, respectively, in five corporate senior loans to a third-party. During the three months ended March 31, 2023, the Company and CIM RACR co-invested $15.5 million and $3.1 million, respectively, in two corporate senior loans to a third-party. In addition, the Company and CIM RACR upsized a co-invested corporate senior loan to a third-party by $1.7 million and $348,000, respectively, during the three months ended March 31, 2023. As of March 31, 2023, $74.9 million of the corporate senior loans was outstanding. The Sub-Advisor provided investment management services related to these corporate senior loans pursuant to the Sub-Advisory Agreement. Subsequent to March 31, 2023, the Company and CIM RACR co-invested $34.1 million and $6.0 million, respectively, in two corporate senior loans to a third-party. The Sub-Advisor provided investment management services related to these corporate senior loans pursuant to the Sub-Advisory Agreement. |
ECONOMIC DEPENDENCY
ECONOMIC DEPENDENCY | 3 Months Ended |
Mar. 31, 2023 | |
Economic Dependency [Abstract] | |
ECONOMIC DEPENDENCY | NOTE 13 — ECONOMIC DEPENDENCY Under various agreements, the Company has engaged and may in the future engage CMFT Management or its affiliates to provide certain services that are essential to the Company, including asset management services, supervision of the management and leasing of properties owned by the Company, asset acquisition and disposition decisions, as well as other administrative responsibilities for the Company including accounting services and stockholder relations. As a result of these relationships, the Company is dependent upon CMFT Management or its affiliates. In the event that these companies are unable to provide the Company with these services, the Company would be required to find alternative providers of these services. |
STOCKHOLDERS_ EQUITY
STOCKHOLDERS’ EQUITY | 3 Months Ended |
Mar. 31, 2023 | |
Equity [Abstract] | |
STOCKHOLDERS’ EQUITY | NOTE 14 — STOCKHOLDERS’ EQUITY Equity-Based Compensation On August 10, 2018, the Board approved the adoption of the Company’s 2018 Equity Incentive Plan (the “2018 Plan”), under which 400,000 of the Company’s shares of common stock were reserved for issuance. On April 27, 2022, the Board and the compensation committee of the Board approved the Amended and Restated CIM Real Estate Finance Trust, Inc. 2022 Equity Incentive Plan (the “2022 Plan”) and the 2022 Plan was approved by the Company’s stockholders at the Company’s 2022 Annual Meeting of Stockholders held on July 12, 2022. The 2022 Plan superseded and replaced the 2018 Plan. Awards that are granted on or after the effective date of the 2022 Plan are subject to the terms and provisions of the 2022 Plan. The total number of shares of Company common stock reserved and available for issuance under the 2022 Plan at any time during the term of the 2022 Plan are 250,000 shares, which is a reduction from 400,000 shares authorized for issuance under the 2018 Plan, and awards of approximately 183,000 shares of common stock are available for future grant at March 31, 2023. Under the 2022 Plan, the Board or the compensation committee of the Board has the authority to grant certain awards to employees, non-employee directors, and consultants or advisors of the Company, including stock option awards, restricted stock awards or deferred stock awards, which awards will further align such persons’ interests with the interests of the Company’s stockholders. The Board or the compensation committee of the Board also has the authority to determine the terms of any award granted pursuant to the 2022 Plan, including vesting schedules, restrictions and acceleration of any restrictions. The 2022 Plan may be amended or terminated by the Board or the compensation committee of the Board at any time, subject to the right of the Company’s stockholders to approve certain amendments. As of March 31, 2023, the Company has granted awards of approximately 116,000 restricted shares in the aggregate to the independent members of the Board under the 2018 Plan and approximately 67,000 restricted shares in the aggregate to the independent members of the Board under the 2022 Plan. As of March 31, 2023, 116,000 of the restricted shares had vested based on one year of continuous service. The remaining 67,000 restricted shares issued had not vested or been forfeited as of |
LEASES
LEASES | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
LEASES | NOTE 15 — LEASES The Company’s real estate assets are leased to tenants under operating leases for which the terms, expirations and extension options vary. The Company’s operating leases do not convey to the lessee the right to purchase the underlying asset upon expiration of the lease period. To determine whether a contract contains a lease, the Company reviews contracts to determine if the agreement conveys the right to control the use of an asset. The Company accounts for lease and non-lease components as a single, combined operating lease component. Non-lease components primarily consist of maintenance services, including CAM, real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. Non-lease components are considered to be variable rental and other property income and are recognized in the period incurred. As of March 31, 2023, the Company’s leases had a weighted-average remaining term of 11.3 years. Certain leases include provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other negotiated terms and conditions. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of March 31, 2023, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands): Future Minimum Rental Income Remainder of 2023 $ 68,750 2024 90,135 2025 89,882 2026 87,107 2027 84,717 Thereafter 645,156 Total $ 1,065,747 A certain amount of the Company’s rental and other property income is from tenants with leases which are subject to contingent rent provisions. These contingent rents are subject to the tenant achieving periodic revenues in excess of specified levels. For the three months ended March 31, 2023 and 2022, the amount of the contingent rent earned by the Company was not significant . Rental and other property income during the three months ended March 31, 2023 and 2022 consisted of the following (in thousands): Three Months Ended March 31, 2023 2022 Fixed rental and other property income (1) $ 37,357 $ 64,706 Variable rental and other property income (2) 1,424 9,030 Total rental and other property income $ 38,781 $ 73,736 __________________________________ (1) Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases, and is net of uncollectible lease-related receivables. (2) Consists primarily of tenant reimbursements for recoverable real estate taxes and property operating expenses, and percentage rent. The Company has one property subject to a non-cancelable operating ground lease with a remaining term of 10.4 years, with a lease liability (in deferred rental income, derivative liabilities and other liabilities prepaid expenses, derivative assets and other assets The Company recognized $63,000 of ground lease expense during the three months ended March 31, 2023, of which $61,000 was paid in cash during the period it was recognized. As of March 31, 2023, the Company’s scheduled future minimum rental payments related to its operating ground lease is approximately $187,000 for the remainder of 2023, $250,000 annually for 2024 through 2028, and $1.2 million thereafter through the maturity date of the lease in August 2033. |
LEASES | NOTE 15 — LEASES The Company’s real estate assets are leased to tenants under operating leases for which the terms, expirations and extension options vary. The Company’s operating leases do not convey to the lessee the right to purchase the underlying asset upon expiration of the lease period. To determine whether a contract contains a lease, the Company reviews contracts to determine if the agreement conveys the right to control the use of an asset. The Company accounts for lease and non-lease components as a single, combined operating lease component. Non-lease components primarily consist of maintenance services, including CAM, real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. Non-lease components are considered to be variable rental and other property income and are recognized in the period incurred. As of March 31, 2023, the Company’s leases had a weighted-average remaining term of 11.3 years. Certain leases include provisions to extend the lease agreements, options for early termination after paying a specified penalty, rights of first refusal to purchase the property at competitive market rates, and other negotiated terms and conditions. The Company retains substantially all of the risks and benefits of ownership of the real estate assets leased to tenants. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants. As of March 31, 2023, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands): Future Minimum Rental Income Remainder of 2023 $ 68,750 2024 90,135 2025 89,882 2026 87,107 2027 84,717 Thereafter 645,156 Total $ 1,065,747 A certain amount of the Company’s rental and other property income is from tenants with leases which are subject to contingent rent provisions. These contingent rents are subject to the tenant achieving periodic revenues in excess of specified levels. For the three months ended March 31, 2023 and 2022, the amount of the contingent rent earned by the Company was not significant . Rental and other property income during the three months ended March 31, 2023 and 2022 consisted of the following (in thousands): Three Months Ended March 31, 2023 2022 Fixed rental and other property income (1) $ 37,357 $ 64,706 Variable rental and other property income (2) 1,424 9,030 Total rental and other property income $ 38,781 $ 73,736 __________________________________ (1) Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases, and is net of uncollectible lease-related receivables. (2) Consists primarily of tenant reimbursements for recoverable real estate taxes and property operating expenses, and percentage rent. The Company has one property subject to a non-cancelable operating ground lease with a remaining term of 10.4 years, with a lease liability (in deferred rental income, derivative liabilities and other liabilities prepaid expenses, derivative assets and other assets The Company recognized $63,000 of ground lease expense during the three months ended March 31, 2023, of which $61,000 was paid in cash during the period it was recognized. As of March 31, 2023, the Company’s scheduled future minimum rental payments related to its operating ground lease is approximately $187,000 for the remainder of 2023, $250,000 annually for 2024 through 2028, and $1.2 million thereafter through the maturity date of the lease in August 2033. |
SEGMENT REPORTING
SEGMENT REPORTING | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | NOTE 16 — SEGMENT REPORTING The Company has two reportable segments: Credit and Real Estate. Corporate/other represents all corporate level and unallocated items and includes the Company’s other asset management activities and expenses. There were no changes in the structure of the Company’s internal organization that prompted the change in reportable segments. Prior period amounts have been revised to conform to the current year presentation shown below. The following tables present segment reporting for the three months ended March 31, 2023 and 2022 (in thousands): Real Estate Credit Corporate/Other (1) Company Total Three Months Ended March 31, 2023 Rental and other property income $ 38,715 $ — $ 66 $ 38,781 Interest income — 108,083 — 108,083 Total revenues 38,715 108,083 66 146,864 General and administrative 74 372 2,852 3,298 Interest expense, net 8,151 54,016 4,067 66,234 Property operating 1,684 — 892 2,576 Real estate tax 425 — 392 817 Expense reimbursements to related parties — — 3,568 3,568 Management fees 3,250 9,329 — 12,579 Transaction-related 13 — — 13 Depreciation and amortization 15,110 — — 15,110 Real estate impairment 4,814 — — 4,814 Increase in provision for credit losses — 1,453 — 1,453 Total expenses 33,521 65,170 11,771 110,462 Other income (expense): Gain on disposition of real estate and condominium developments, net 19,563 — 60 19,623 Loss on investment in unconsolidated entities — (770) — (770) Unrealized gain on equity security — 2,258 — 2,258 Other (expense) income, net (1,842) 1,843 323 324 Loss on extinguishment of debt (1,172) — (2,473) (3,645) Segment net income (loss) $ 21,743 $ 46,244 $ (13,795) $ 54,192 Net income allocated to noncontrolling interest 8 — — 8 Segment net income (loss) attributable to the Company $ 21,735 $ 46,244 $ (13,795) $ 54,184 Total assets as of March 31, 2023 $ 1,315,426 $ 4,725,168 $ 604,932 $ 6,645,526 __________________________________ (1) Includes condominium and rental units acquired via foreclosure during the year ended December 31, 2021. Real Estate Credit Corporate/Other (1) (2) Company Total Three Months Ended March 31, 2022 Rental and other property income $ 73,639 $ — $ 97 $ 73,736 Interest income — 31,463 — 31,463 Total revenues 73,639 31,463 97 105,199 General and administrative 149 230 3,096 3,475 Interest expense, net 15,078 11,612 3,306 29,996 Property operating 7,136 — 591 7,727 Real estate tax 6,350 — 363 6,713 Expense reimbursements to related parties — — 3,694 3,694 Management fees 7,131 6,216 — 13,347 Transaction-related 7 — — 7 Depreciation and amortization 19,141 — — 19,141 Real estate impairment 3,291 — — 3,291 Increase in provision for credit losses — 4,709 — 4,709 Total expenses 58,283 22,767 11,050 92,100 Other income (expense): Gain on disposition of real estate and condominium developments, net 29,265 — 3,309 32,574 Gain on investment in unconsolidated entities — 168 5,172 5,340 Unrealized (loss) gain on equity security — (2,368) 22 (2,346) Other income, net 1,239 66 — 1,305 Loss on extinguishment of debt (10,737) — (134) (10,871) Segment net income (loss) $ 35,123 $ 6,562 $ (2,584) $ 39,101 Net income allocated to noncontrolling interest 9 — — 9 Segment net income (loss) attributable to the Company $ 35,114 $ 6,562 $ (2,584) $ 39,092 Total assets as of March 31, 2022 $ 2,919,412 $ 3,767,306 $ 281,702 $ 6,968,420 __________________________________ (1) Includes condominium and rental units acquired via foreclosure during the year ended December 31, 2021. (2) Includes the Company’s investment in CIM UII Onshore, L.P. (“CIM UII Onshore”). |
SUBSEQUENT EVENTS
SUBSEQUENT EVENTS | 3 Months Ended |
Mar. 31, 2023 | |
Subsequent Events [Abstract] | |
SUBSEQUENT EVENTS | NOTE 17 — SUBSEQUENT EVENTS Redemptions of Shares of Common Stock Subsequent to March 31, 2023, the Company redeemed approximately 1.6 million shares for $10.8 million (at a redemption price of $6.57 per share). The remaining redemption requests received during the three months ended March 31, 2023 totaling approximately 23.9 million shares went unfulfilled. Investment and Disposition Activity Subsequent to March 31, 2023, the Company’s investment and disposition activity included the following: • Sold 27 of the properties under contract for sale pursuant to the Realty Income Purchase and Sale Agreement for total consideration of $82.1 million and a gain of approximately $12.8 million. • In addition to the properties disposed of pursuant to the Realty Income Purchase and Sale Agreement, the Company disposed of two properties and condominium units for an aggregate gross sales price of $25.4 million, resulting in net proceeds of $23.9 million after closing costs and a net gain of approximately $7.6 million. • Purchased $63.5 million in CMBS. • Settled $13.0 million of liquid senior loan purchases, all of which were traded as of March 31, 2023, and sold $5.8 million of liquid senior loans. • Invested $44.1 million in three corporate senior loans to a third-party. • Funded an aggregate amount of $4.9 million to six of the Company’s first mortgage loans. Financing Activity Subsequent to March 31, 2023, the Company’s financing activity included the following: • Financed CMBS under the J.P. Morgan Repurchase Facility for $36.2 million and repaid $551,000 of borrowings under the J.P. Morgan Repurchase Facility. • Repaid $88.0 million of borrowings under the Credit Securities Revolver. • Repaid $5.0 million of borrowings under the Deutsche Bank Repurchase Facility. |
SUMMARY OF SIGNIFICANT ACCOUN_2
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Basis of Accounting | The summary of significant accounting policies presented below is designed to assist in understanding the Company’s condensed consolidated financial statements. These accounting policies conform to accounting principles generally accepted in the United States of America (“GAAP”) in all material respects, and have been consistently applied in preparing the accompanying condensed consolidated financial statements. |
Principles of Consolidation and Basis of Presentation | Principles of Consolidation and Basis of Presentation The condensed consolidated financial statements of the Company have been prepared in accordance with the rules and regulations of the SEC regarding interim financial reporting, including the instructions to Form 10-Q and Article 10 of Regulation S-X, and do not include all of the information and footnotes required by GAAP for complete financial statements. In the opinion of management, the statements for the interim periods presented include all adjustments, which are of a normal and recurring nature, necessary for a fair presentation of the results for such periods. Results for these interim periods are not necessarily indicative of full year results. The information included in this Quarterly Report on Form 10-Q should be read in conjunction with the Company’s audited consolidated financial statements as of and for the year ended December 31, 2022, and related notes thereto, set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2022. The condensed consolidated financial statements should also be read in conjunction with Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in this Quarterly Report on Form 10-Q. The condensed consolidated financial statements include the accounts of the Company and its wholly-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. In determining whether the Company has controlling interests in an entity and is required to consolidate the accounts in that entity, the Company analyzes its credit and real estate investments in accordance with standards set forth in GAAP to determine whether the entities are variable interest entities (“VIEs”), and if so, whether the Company is the primary beneficiary. The Company’s judgment with respect to its level of influence or control over an entity and whether the Company is the primary beneficiary of a VIE involves consideration of various factors, including the form of the Company’s ownership interest, the Company’s voting interest, the size of the Company’s investment (including loans), and the Company’s ability to participate in major policy-making decisions. The Company’s ability to correctly assess its influence or control over an entity affects the presentation of these credit and real estate investments on the Company’s condensed consolidated financial statements. |
Reclassifications | Reclassifications Certain amounts in the Company’s prior period condensed consolidated financial statements have been reclassified to conform to the current period presentation. The Company has chosen to break out the details of $30.0 million of interest expense, net from other income, net into expenses in the Company’s condensed consolidated statement of operations for the three months ended March 31, 2022, driven by the Company’s current investment portfolio composition being predominantly comprised of credit investments. This reclassification of interest expense, net did not have an impact on net income or cash flow from operating activities. I n addition, the Company has chosen to break out the details of $2.3 million of unrealized loss on equity security from other income, net in the Company’s condensed consolidated statement of operations for the three months ended March 31, 2022. The Company has also chosen to break out the details of $7.2 million of accrued interest receivable from derivative assets, prepaid expenses and other assets derivative assets, prepaid expenses and other assets |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. |
Real Estate Assets, Recoverability of Real Estate Assets, Assets Held for Sale, and Dispositions of Real Estate Assets | Real Estate Assets Real estate assets are stated at cost, less accumulated depreciation and amortization. The Company considers the period of future benefit of each respective asset to determine the appropriate useful life. The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term Recoverability of Real Estate Assets Dispositions of Real Estate Assets Gains and losses from dispositions are recognized once the various criteria relating to the terms of sale and any subsequent involvement by the Company with the asset sold are met. A discontinued operation includes only the disposal of a component of an entity and represents a strategic shift that has (or will have) a major effect on an entity’s financial results. Given the Company’s current asset portfolio and strategy, the Company’s dispositions during the three months ended March 31, 2023 and |
Allocation of Purchase Price of Real Estate Assets | Allocation of Purchase Price of Real Estate Assets Upon the acquisition of real properties, the Company allocates the purchase price to acquired tangible assets, consisting of land, buildings and improvements, and to identified intangible assets and liabilities, consisting of the value of above- and below-market leases and the value of in-place leases and other intangibles, based in each case on their relative fair values. The Company utilizes independent appraisals to assist in the determination of the fair values of the tangible assets of an acquired property (which includes land and buildings). The information in the appraisal, along with any additional information available to the Company’s management, is used in estimating the amount of the purchase price that is allocated to land. Other information in the appraisal, such as building value and market rents, may be used by the Company’s management in estimating the allocation of purchase price to the building and to intangible lease assets and liabilities. The appraisal firm has no involvement in management’s allocation decisions other than providing this market information. The determination of the fair values of the real estate assets and liabilities acquired requires the use of significant assumptions with regard to the current market rental rates, rental growth rates, capitalization and discount rates, interest rates and other variables. The use of alternative estimates may result in a different allocation of the Company’s purchase price, which could materially impact the Company’s results of operations. |
Investments in Unconsolidated Entities | Investment in Unconsolidated Entities CMFT MT JV Holdings, LLC, an indirect wholly-owned subsidiary of the Company, is engaged in an unconsolidated joint venture arrangement through CIM NP JV Holdings, LLC (“NP JV Holdings”) (the “Unconsolidated Joint Venture”), of which it owns 50% of the outstanding equity. Through the Unconsolidated Joint Venture, which holds approximately 90% of the membership interest in NewPoint JV, LLC (the “NewPoint JV”) pursuant to the terms of the Operating Agreement entered into between the Unconsolidated Joint Venture and NewPoint Bridge Lending, LLC, the Company indirectly owns approximately 45% of the outstanding equity of the NewPoint JV on a fully diluted basis. The Company accounts for its investment under the equity method. The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and is subsequently adjusted for the Company’s share of equity in NP JV Holdings’ earnings and distributions, including unrealized gains and losses as a result of changes in fair value of the NewPoint JV. The Company records its share of NP JV Holdings’ profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s condensed consolidated balance sheet and such share is recognized as a profit or loss on the condensed consolidated statements of operations. The Company recorded a loss totaling $770,000, which represented its share of NP JV Holdings’ loss, during the three months ended March 31, 2023 in the condensed consolidated statements of operations. As of March 31, 2023, the Company’s aggregate investment in NP JV Holdings of $97.4 million is included in investment in unconsolidated entities on the condensed consolidated balance sheets. For more information, refer to Note 6 — Investment in Unconsolidated Entities. On March 31, 2022, the Company fully redeemed its $60.7 million investment in CIM UII Onshore, L.P. (“CIM UII Onshore”). Prior to redemption, the Company had less than 5% ownership of CIM UII Onshore and accounted for its investment under the equity method. The equity method of accounting requires the investment to be initially recorded at cost, including transaction costs incurred to finalize the investment, and subsequently adjusted for the Company’s share of equity in CIM UII Onshore’s earnings and distributions. Prior to redemption, the Company recorded its share of CIM UII Onshore’s profits or losses on a quarterly basis as an adjustment to the carrying value of the investment on the Company’s consolidated balance sheet and such share is recognized as a profit or loss on the consolidated statements of operations. During the three months ended March 31, 2022, the Company recorded its share of CIM UII Onshore’s gain totaling $5.2 million. The Company received distributions of $531,000 related to its investment in CIM UII Onshore, all of which was recognized as a return on investment. |
Restricted Cash | Restricted CashAs part of certain debt agreements, rents from certain encumbered properties are deposited directly into a lockbox account, from which the monthly debt service payment is disbursed to the lender and the excess is disbursed to the Company. |
Real Estate-Related Securities | Real Estate-Related Securities Real estate-related securities consists primarily of the Company’s investments in commercial mortgage-backed securities (“CMBS”) and equity securities. The Company determines the appropriate classification for real estate-related securities at the time of purchase and reevaluates such designation as of each balance sheet date. The Company monitors its available-for-sale securities for changes in fair value. A loss is recognized when the Company determines that a decline in the estimated fair value of a security below its amortized cost has resulted from a credit loss or other factors. The Company records impairments related to credit losses through current expected credit losses. However, the allowance is limited by the amount that the fair value is less than the amortized cost basis. For additional information regarding the Company’s process for estimating current expected credit losses for its real estate-related securities, see the Current Expected Credit Losses section below. The amortized cost of real estate-related securities is adjusted for amortization of premiums and accretion of discounts to maturity computed under the effective interest method and is recorded in the accompanying condensed consolidated statements of operations in interest income. Upon the sale of a security, the realized net gain or loss is computed on the specific identification method. Interest earned is either received in cash or capitalized to real estate-related securities in the Company’s condensed consolidated balance sheets. Interest is capitalized when certain conditions are met as specified in each security agreement. During the three months ended March 31, 2023 and 2022, the Company capitalized $284,000 and $272,000, respectively, of interest income to real estate-related securities. |
Loans Held-for-Investment | Loans Held-for-Investment The Company’s loans held-for-investment include loans related to real estate assets, as well as credit investments, including commercial mortgage loans and other loans and securities related to commercial real estate assets, as well as corporate loan opportunities that are consistent with the Company’s investment strategy and objectives. The Company intends to hold the loans held-for-investment for the foreseeable future or until maturity. Loans held-for-investment are carried on the Company’s condensed consolidated balance sheets at amortized cost, net of any current expected credit losses. Discounts or premiums, origination fees and exit fees are amortized as a component of interest income using the effective interest method over the life of the respective loans, or on a straight-line basis when it approximates the effective interest method. Upon the sale of a loan, the realized net gain or loss is computed on the specific identification method. Interest earned is either received in cash or capitalized to loans held-for-investment and related receivables, net in the Company’s condensed consolidated balance sheets. Interest is capitalized when certain conditions are met as specified in each loan agreement. |
Current Expected Credit Losses | Current Expected Credit Losses The Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments - Credit Losses (Topic 326) (“ASU 2016-13”), on January 1, 2020. Current expected credit losses (“CECL”) required under ASU 2016-13 reflects the Company’s current estimate of potential credit losses related to the Company’s loans held-for-investment included in the condensed consolidated balance sheets. Changes to current expected credit losses are recognized through net income on the Company’s condensed consolidated statements of operations. While ASU 2016-13 does not require any particular method for determining current expected credit losses, it does specify current expected credit losses should be based on relevant information about past events, including historical loss experience, current portfolio and market conditions, and reasonable and supportable forecasts for the duration of each respective loan. In addition, other than a few narrow exceptions, ASU 2016-13 requires that all financial instruments subject to the credit loss model have some amount of loss reserve to reflect the GAAP principal underlying the credit loss model that all loans, debt securities, and similar assets have some inherent risk of loss, regardless of credit quality, subordinate capital, or other mitigating factors. The Company estimates the current expected credit loss for its first mortgage loans primarily using the Weighted Average Remaining Maturity method, which has been identified as an acceptable method for estimating CECL reserves in the Financial Accounting Standards Board (“FASB”) Staff Q&A Topic 326, No. 1. This method requires the Company to reference historic loan loss data across a comparable data set and apply such loss rate to each loan investment over its expected remaining term, taking into consideration expected economic conditions over the relevant timeframe. The Company considers loan investments that are both (i) expected to be substantially repaid through the operation or sale of the underlying collateral, and (ii) for which the borrower is experiencing financial difficulty, to be “collateral-dependent” loans. For such loans that the Company determines that foreclosure of the collateral is probable, the Company measures the expected losses based on the difference between the fair value of the collateral less costs to sell and the amortized cost basis of the loan as of the measurement date. For collateral-dependent loans that the Company determines foreclosure is not probable, the Company applies a practical expedient to estimate expected losses using the difference between the collateral’s fair value (less costs to sell the asset if repayment is expected through the sale of the collateral) and the amortized cost basis of the loan. For the Company’s liquid corporate senior loans and corporate senior loans, the Company uses a probability of default and loss given default method using a comparable data set. The Company may use other acceptable alternative approaches in the future depending on, among other factors, the type of loan, underlying collateral, and availability of relevant historical market loan loss data. Quarterly, the Company evaluates the risk of all loans and assigns a risk rating based on a variety of factors, grouped as follows: (i) loan and credit structure, including the as-is loan-to-value (“LTV”) ratio and structural features; (ii) quality and stability of real estate value and operating cash flow, including debt yield, dynamics of the geography, property type and local market, physical condition, stability of cash flow, leasing velocity and quality and diversity of tenancy; (iii) performance against underwritten business plan; and (iv) quality, experience and financial condition of sponsor, borrower and guarantor(s). Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from least risk to greatest risk, respectively, which ratings are defined as follows: 1- Outperform — Most satisfactory asset quality and liquidity, good leverage capacity. A “1” rating maintains predictable and strong cash flows from operations. The trends and outlook for the credit's operations, balance sheet, and industry are neutral to favorable. Collateral, if appropriate, exceeds performance metrics; 2- Meets or Exceeds Expectations — Acceptable asset quality, moderate excess liquidity, modest leverage capacity. A “2” rating could have some financial/non-financial weaknesses which are offset by strengths; however, the credit demonstrates an ample current cash flow from operations. The trends and outlook for the credit's operations, balance sheet, and industry are generally positive or neutral. Collateral performance, if appropriate, meets or exceeds substantially all performance metrics included in original or current underwriting / business plan; 3- Satisfactory — Acceptable asset quality, somewhat strained liquidity, minimal leverage capacity. A “3” rating is at times characterized by acceptable cash flows from operations. The trends and conditions of the credit's operations and balance sheet are neutral. Collateral performance, if appropriate, meets or is on track to meet underwriting; business plan can reasonably be achieved; 4- Underperformance — The debt investment possesses credit deficiencies or potential weaknesses which deserve management’s close and continued attention. The portfolio company’s operations and/or balance sheet have demonstrated an adverse trend or deterioration which, while serious, has not reached the point where the liquidation of debt is jeopardized. These weaknesses are generally considered correctable by the borrower in the normal course of business but may weaken the asset or inadequately protect the Company’s credit position if not checked or corrected. Collateral performance, if appropriate, falls short of original underwriting, material differences exist from business plan, or both; technical milestones have been missed; defaults may exist, or may soon occur absent material improvement; and 5- Default/Possibility of Loss — The debt investment is protected inadequately by the current enterprise value or paying capacity of the obligor or of the collateral, if any. The underlying company’s operations have well-defined weaknesses based upon objective evidence, such as recurring or significant decreases in revenues and cash flows. Major variance from business plan; loan covenants or technical milestones have been breached; timely exit from loan via sale or refinancing is questionable; risk of principal loss. Collateral performance, if appropriate, is significantly worse than underwriting. The Company generally assigns a risk rating of “3” to all newly originated or acquired loans held-for-investment during a most recent quarter, except in the case of specific circumstances warranting an exception. In estimating credit losses related to real estate-related securities, management considers a variety of factors, including, but not limited to, the extent to which the fair value is less than the amortized cost basis, recent events specific to the security, industry or geographic area, the payment structure of the security, the failure of the issuer of the security to make scheduled interest or principal payments, and external credit ratings and recent changes in such ratings. |
Leases | Leases The Company has lease agreements with lease and non-lease components. The Company has elected to not separate non-lease components from lease components for all classes of underlying assets (primarily real estate assets) and will account for the combined components as rental and other property income. Non-lease components included in rental and other property income include certain tenant reimbursements for maintenance services (including common-area maintenance services or “CAM”), real estate taxes, insurance and utilities paid for by the lessor but consumed by the lessee. As a lessor, the Company has further determined that this policy will be effective only on a lease that has been classified as an operating lease and the revenue recognition pattern and timing is the same for both types of components. The Company is not a party to any material leases where it is the lessee. Significant judgments and assumptions are inherent in not only determining if a contract contains a lease, but also the lease classification, terms, payments, and, if needed, discount rates. Judgments include the nature of any options, including if they will be exercised, evaluation of implicit discount rates and the assessment and consideration of “fixed” payments for straight-line rent revenue calculations. |
Development Activities | Development Activities Project costs and expenses, including interest incurred, associated with the development, construction and lease-up of a real estate project are capitalized as construction in progress. During the three months ended March 31, 2023 and 2022, the Company capitalized $2.7 million and $3.1 million, respectively, of expenses associated with the development of condominiums acquired via foreclosure, which is included in condominium developments in the accompanying condensed consolidated balance sheets. Included in the amounts capitalized during the three months ended March 31, 2023 and 2022 was $458,000 and $387,000, respectively, of capitalized interest expense. |
Revenue Recognition | Revenue Recognition Revenue from leasing activities Rental and other property income is primarily derived from fixed contractual payments from operating leases, and therefore, is generally recognized on a straight-line basis over the term of the lease, which typically begins the date the tenant takes control of the space. When the Company acquires a property, the terms of existing leases are considered to commence as of the acquisition date for the purpose of this calculation. Variable rental and other property income consists primarily of tenant reimbursements for recoverable real estate taxes and operating expenses which are included in rental and other property income in the period when such costs are incurred, with offsetting expenses in real estate taxes and property operating expenses, respectively, within the condensed consolidated statements of operations. The Company defers the recognition of variable rental and other property income, such as percentage rents, until the specific target that triggers the contingent rental income is achieved. The Company continually reviews whether collection of lease-related receivables, including any straight-line rent, and current and future operating expense reimbursements from tenants are probable. The determination of whether collectability is probable takes into consideration the tenant’s payment history, the financial condition of the tenant, business conditions in the industry in which the tenant operates and economic conditions in the area in which the property is located. Upon the determination that the collectability of a receivable is not probable, the Company will record a reduction to rental and other property income for amounts previously recorded and a decrease in the outstanding receivable. Revenue from leases where collection is deemed to be not probable is recorded on a cash basis until collectability becomes probable. Management’s estimate of the collectability of lease-related receivables is based on the best information available at the time of estimate. The Company does not use a general reserve approach and lease-related receivables are adjusted and taken against rental and other property income only when collectability becomes not probable. Revenue from lending activities Interest income from the Company’s loans held-for-investment and real estate-related securities is comprised of interest earned on loans and the accretion and amortization of net loan origination fees and discounts. Interest income on loans is accrued as earned, with the accrual of interest suspended when the related loan becomes a nonaccrual loan. Interest income on the Company’s liquid corporate senior loans is accrued as earned beginning on the settlement date. |
Reportable Segments | Reportable Segments The Company’s segment information reflects how the chief operating decision makers review information for operational decision-making purposes. The Company has two reportable segments: Credit — engages primarily in acquiring and originating primarily floating rate first and second lien mortgage loans, either directly or through co-investments in joint ventures, related to real estate assets. This segment also includes investments in real estate-related securities, liquid corporate senior loans and corporate senior loans. Real estate — engages primarily in acquiring and managing geographically diversified income-producing retail, industrial and office properties that are primarily single-tenant properties, which are leased to creditworthy tenants under long-term net leases. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements From time to time, new accounting pronouncements are issued by various standard setting bodies that may have an impact on the Company’s accounting and reporting. Except as otherwise stated below, the Company is currently evaluating the effect that certain new accounting requirements may have on the Company’s accounting and related reporting and disclosures in the Company’s condensed consolidated financial statements. On March 31, 2022, the FASB issued ASU No. 2022-02, Troubled Debt Restructurings and Vintage Disclosures (Topic 326) (“ASU 2022-02”). ASU 2022-02 eliminates the recognition and measurement guidance for troubled debt restructurings (“TDRs”) and, instead, requires that an entity evaluate (consistent with the accounting for other loan modifications) whether the modification represents a new loan or a continuation of an existing loan. The ASU also enhances existing disclosure requirements and introduces new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. The ASU became effective for the Company beginning January 1, 2023 and is generally to be applied prospectively. ASU 2022-02 did not have an impact on the Company’s condensed consolidated financial statements for the three months ended March 31, 2023. In June 2022, the FASB issued ASU No. 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions |
Fair Value Measurement | The following describes the methods the Company uses to estimate the fair value of the Company’s financial assets and liabilities: Real estate-related securities — The Company generally determines the fair value of its real estate-related securities by utilizing broker-dealer quotations, reported trades or valuation estimates from pricing models to determine the reported price. Pricing models for real estate-related securities are generally discounted cash flow models that usually consider the attributes applicable to a particular class of security (e.g., credit rating, seniority), current market data, and estimated cash flows for each class and incorporate deal collateral performance such as prepayment speeds and default rates, as available. Depending upon the significance of the fair value inputs used in determining these fair values, these securities are valued using Level 1, Level 2 or Level 3 inputs. As of March 31, 2023, the Company concluded that $307.5 million of its CMBS fell under Level 2 and $172.6 million of its CMBS fell under Level 3. The Company’s equity security investment is valued using Level 1 inputs. The estimated fair value of the Company’s equity security is based on quoted market prices that are readily and regularly available in an active market. Credit facilities and notes payable — The fair value is estimated by discounting the expected cash flows based on estimated borrowing rates available to the Company as of the measurement date. Current and prior period liabilities’ carrying and fair values exclude net deferred financing costs. These financial instruments are valued using Level 2 inputs. As of March 31, 2023, the estimated fair value of the Company’s debt was $3.86 billion, compared to a carrying value of $3.98 billion. The estimated fair value of the Company’s debt as of December 31, 2022 was $4.32 billion, compared to a carrying value of $4.44 billion. Derivative instruments — The Company’s derivative instruments are comprised of interest rate caps. All derivative instruments are carried at fair value and are valued using Level 2 inputs. The fair value of these instruments is determined using interest rate market pricing models. In addition, credit valuation adjustments are incorporated into the fair values to account for the Company’s potential nonperformance risk and the performance risk of the respective counterparties. Although the Company has determined that the majority of the inputs used to value its derivatives fall within Level 2 of the fair value hierarchy, the credit valuation adjustments associated with those derivatives utilize Level 3 inputs, such as estimates of current credit spreads, to evaluate the likelihood of default by the Company and its counterparties. However, as of March 31, 2023 and December 31, 2022, the Company assessed the significance of the impact of the credit valuation adjustments on the overall valuation of its derivative positions and determined that the credit valuation adjustments are not significant to the overall valuation of the Company’s derivatives. As a result, the Company has determined that its derivative valuations in their entirety are classified in Level 2 of the fair value hierarchy. Loans held-for-investment — The Company’s loans held-for-investment are recorded at cost upon origination and adjusted by net loan origination fees and discounts. The Company estimates the fair value of its loans held-for-investment by performing a present value analysis for the anticipated future cash flows using an appropriate market discount rate taking into consideration the credit risk. The Company has determined that its commercial real estate (“CRE”) loans held-for-investment and corporate senior loans are classified in Level 3 of the fair value hierarchy. The Company’s liquid corporate senior loans are classified as Level 2 or Level 3 depending on the number of market quotations or indicative prices from pricing services that are available, and whether the depth of the market is sufficient to transact at those prices in amounts approximating the Company’s investment position at the measurement date. As of March 31, 2023, $542.2 million and $129.5 million of the Company’s liquid corporate senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively. As of December 31, 2022, $494.4 million and $168.0 million of the Company’s liquid corporate senior loans were classified in Level 2 and Level 3 of the fair value hierarchy, respectively. As of March 31, 2023, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $3.91 billion, compared to its carrying value of $3.93 billion. As of December 31, 2022, the estimated fair value of the Company’s loans held-for-investment and related receivables, net was $3.98 billion, compared to its carrying value of $4.00 billion. Other financial instruments — The Company considers the carrying values of its cash and cash equivalents, restricted cash, tenant receivables, accounts payable and accrued expenses, other liabilities, due to affiliates and distributions payable to approximate their fair values because of the short period of time between their origination and their expected realization as well as their highly-liquid nature. Due to the short-term maturities of these instruments, Level 1 inputs are utilized to estimate the fair value of these financial instruments. Considerable judgment is necessary to develop estimated fair values of financial assets and liabilities. Accordingly, the estimates presented herein are not necessarily indicative of the amounts the Company could realize, or be liable for, upon disposition of the financial assets and liabilities. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter. The Company does not expect that changes in classifications between levels will be frequent. |
SUMMARY OF SIGNIFICANT ACCOUN_3
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Accounting Policies [Abstract] | |
Summary of Estimated Useful Lives of Real Estate Assets By Class | The estimated useful lives of the Company’s real estate assets by class are generally as follows: Buildings 40 years Site improvements 15 years Tenant improvements Lesser of useful life or lease term Intangible lease assets Lease term |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value, Assets and Liabilities Measured on a Recurring Basis | In accordance with the fair value hierarchy described above, the following tables show the fair value of the Company’s financial assets that are required to be measured at fair value on a recurring basis as of March 31, 2023 and December 31, 2022 (in thousands): Balance as of Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets: CMBS $ 480,133 $ — $ 307,507 $ 172,626 Equity security 40,506 40,506 — — Interest rate caps 3,080 — 3,080 — Total financial assets $ 523,719 $ 40,506 $ 310,587 $ 172,626 Balance as of Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Financial assets: CMBS $ 538,142 $ — $ 348,241 $ 189,901 Equity security 38,249 38,249 — — Interest rate caps 5,040 — 5,040 — Total financial assets $ 581,431 $ 38,249 $ 353,281 $ 189,901 |
Reconciliation of the Changes in Liabilities With Level 3 Inputs | The following are reconciliations of the changes in financial assets with Level 3 inputs in the fair value hierarchy for the three months ended March 31, 2023 (in thousands): Level 3 Beginning Balance, January 1, 2023 $ 189,901 Total gains and losses: Unrealized loss included in other comprehensive loss, net (21,911) Purchases and payments received: Discounts, net 4,352 Capitalized interest income 284 Ending Balance, March 31, 2023 $ 172,626 |
Summary of Discount Rates and Terminal Capitalization rates of the Company’s Impairment Test | The following summarizes the ranges of discount rates and terminal capitalization rates used for the Company’s impairment test for the real estate assets during the three months ended March 31, 2023 and 2022: Three Months Ended March 31, 2023 2022 Discount Rate Terminal Capitalization Rate Discount Rate Terminal Capitalization Rate 9.7% 7.5% – 9.2% 8.0% – 9.7% 7.5% – 9.2% |
Summary of Impairment Charges by Asset Class | The following table presents the impairment charges by asset class recorded during the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 2022 Asset class impaired: Land $ 1,144 $ 964 Buildings, fixtures and improvements 3,652 1,974 Intangible lease assets 18 354 Intangible lease liabilities — (1) Total impairment loss $ 4,814 $ 3,291 |
INTANGIBLE LEASE ASSETS AND L_2
INTANGIBLE LEASE ASSETS AND LIABILITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Finite-lived Intangible Assets and Liabilities | Intangible lease assets and liabilities consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands, except weighted average life remaining): March 31, 2023 December 31, 2022 Intangible lease assets: In-place leases and other intangibles, net of accumulated amortization of $46,214 and $86,881, respectively (with a weighted average life remaining of 11.7 years and 11.1 years, respectively) $ 110,887 $ 174,954 Acquired above-market leases, net of accumulated amortization of $2,773 and $4,210, respectively (with a weighted average life remaining of 11.7 years and 12.9 years, respectively) 4,262 10,639 Total intangible lease assets, net $ 115,149 $ 185,593 Intangible lease liabilities: Acquired below-market leases, net of accumulated amortization of $4,221 and $5,575, respectively (with a weighted average life remaining of 12.8 years and 12.4 years, respectively) $ 14,269 $ 19,054 |
Schedule of Amortization Expense Related to the Intangible Lease Assets | The following table summarizes the amortization related to the intangible lease assets and liabilities for the three months ended March 31, 2023 and 2022 (in thousands): Three Months Ended March 31, 2023 2022 In-place lease and other intangible amortization $ 5,082 $ 6,786 Above-market lease amortization $ 234 $ 316 Below-market lease amortization $ 433 $ 579 |
Schedule of Finite-lived Intangible Assets, Future Amortization Expense | As of March 31, 2023, the estimated amortization relating to the intangible lease assets and liabilities is as follows (in thousands): Amortization In-Place Leases and Above-Market Leases Below-Market Leases Remainder of 2023 $ 9,139 $ 348 $ 915 2024 11,694 424 1,126 2025 11,300 424 1,120 2026 10,092 379 1,120 2027 9,292 356 1,120 Thereafter 59,370 2,331 8,868 Total $ 110,887 $ 4,262 $ 14,269 |
REAL ESTATE-RELATED SECURITIES
REAL ESTATE-RELATED SECURITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Investments, Debt and Equity Securities [Abstract] | |
Schedule of Securities Available for Sale | The following is a summary of the Company’s real estate-related securities as of March 31, 2023 (in thousands): Real Estate-Related Securities Amortized Cost Basis Unrealized Loss Fair Value CMBS $ 554,950 $ (74,817) $ 480,133 Equity security 53,388 (12,882) 40,506 Total real estate-related securities $ 608,338 $ (87,699) $ 520,639 The following table provides the activity for the real estate-related securities during the three months ended March 31, 2023 (in thousands): Amortized Cost Basis Unrealized Loss Fair Value Real estate-related securities as of January 1, 2023 $ 640,037 $ (63,646) $ 576,391 Face value of real estate-related securities acquired 9,738 — 9,738 Premiums and discounts on purchase of real estate-related securities, net of acquisition costs (336) — (336) Amortization of discount on real estate-related securities 7,590 — 7,590 Capitalized interest income on real estate-related securities 284 — 284 Principal payments received on real estate-related securities (1) (48,975) — (48,975) Unrealized loss on real estate-related securities — (24,053) (24,053) Real estate-related securities as of March 31, 2023 $ 608,338 $ (87,699) $ 520,639 ____________________________________ (1) Includes the repayment of the Company’s position in two different tranches of a CMBS instrument prior to their stated maturity dates. The scheduled maturities of the Company’s CMBS as of March 31, 2023 are as follows (in thousands): CMBS Amortized Cost Estimated Fair Value Due within one year $ 364,798 $ 312,595 Due after one year through five years 148,125 136,452 Due after five years through ten years — — Due after ten years 42,027 31,086 Total $ 554,950 $ 480,133 |
LOANS HELD-FOR-INVESTMENT (Tabl
LOANS HELD-FOR-INVESTMENT (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Schedule of Allowance for Financing Receivable | The Company’s loans held-for-investment consisted of the following as of March 31, 2023 and December 31, 2022 (in thousands): As of March 31, As of December 31, 2023 2022 First mortgage loans (1) $ 3,198,651 $ 3,285,193 Total CRE loans held-for-investment and related receivables, net 3,198,651 3,285,193 Liquid corporate senior loans 703,866 701,540 Corporate senior loans 73,799 57,165 Loans held-for-investment and related receivables, net $ 3,976,316 $ 4,043,898 Less: Current expected credit losses $ (43,779) $ (42,344) Total loans held-for-investment and related receivable, net $ 3,932,537 $ 4,001,554 ____________________________________ (1) As of March 31, 2023, first mortgage loans included $20.1 million of contiguous mezzanine loan components that, as a whole, have expected credit quality similar to that of a first mortgage loan. The following table details overall statistics for the Company’s loans held-for-investment as of March 31, 2023 and December 31, 2022 (dollar amounts in thousands): CRE Loans (1) (2) Liquid Corporate Senior Loans Corporate Senior Loans March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022 March 31, 2023 December 31, 2022 Number of loans 28 29 315 317 6 4 Principal balance $ 3,216,545 $ 3,306,411 $ 710,334 $ 708,254 $ 74,917 $ 57,918 Net book value $ 3,176,350 $ 3,264,841 $ 683,585 $ 680,345 $ 72,602 $ 56,368 Weighted-average interest rate 8.0 % 7.6 % 8.5 % 8.0 % 11.3 % 10.5 % Weighted-average maximum years to maturity 3.4 3.6 4.6 4.7 4.4 4.6 Unfunded loan commitments (3) $ 287,515 $ 304,649 $ 1,425 $ 1,425 $ 3,794 $ 4,324 ____________________________________ (1) As of March 31, 2023, 100% of the Company’s CRE loans by principal balance earned a floating rate of interest, primarily indexed to SOFR and U.S. dollar LIBOR. (2) Maximum maturity date assumes all extension options are exercised by the borrowers; however, the Company’s CRE loans may be repaid prior to such date. (3) Unfunded loan commitments are subject to the satisfaction of borrower milestones and are not reflected in the accompanying condensed consolidated balance sheets. This balance does not include unsettled liquid corporate senior loan purchases of $18.0 million that are included in cash and cash equivalents in the accompanying condensed consolidated balance sheets. Activity relating to the Company’s loans held-for-investment portfolio was as follows (in thousands): CRE Loans Liquid Corporate Senior Loans Corporate Senior Loans Total Loan Portfolio Balance, January 1, 2023 $ 3,264,841 $ 680,345 $ 56,368 $ 4,001,554 Loan originations and acquisitions 17,007 27,521 17,182 61,710 Sale of loans — (8,311) — (8,311) Principal repayments received (1) (106,873) (16,940) (183) (123,996) Deferred fees and other items (2) — (780) (420) (1,200) Accretion and amortization of fees and other items 3,324 836 55 4,215 Current expected credit losses (3) (1,949) 914 (400) (1,435) Balance, March 31, 2023 $ 3,176,350 $ 683,585 $ 72,602 $ 3,932,537 ____________________________________ (1) Includes the repayment of a $105.0 million first mortgage loan prior to the maturity date. (2) Other items primarily consist of purchase discounts or premiums and deferred origination expenses. (3) Does not include current expected losses for unfunded or unsettled loan commitments. Such amounts are included in accrued expenses and accounts payable on the accompanying condensed consolidated balance sheets. The following table presents the activity in the Company’s current expected credit losses related to loans held-for-investment by loan type for the three months ended March 31, 2023 (in thousands): First Mortgage Loans Unfunded First Mortgage Loans (1) Liquid Corporate Senior Loans Unfunded or Unsettled Liquid Corporate Senior Loans (1) Corporate Senior Loans Unfunded Corporate Senior Loans (1) Total Current expected credit losses as of January 1, 2023 $ 20,352 $ 1,890 $ 21,195 $ 377 $ 797 $ 66 $ 44,677 Provision for (reversal of) credit losses 1,949 138 (914) (121) 400 1 1,453 Current expected credit losses as of March 31, 2023 $ 22,301 $ 2,028 $ 20,281 $ 256 $ 1,197 $ 67 $ 46,130 ____________________________________ (1) Current expected losses for unfunded or unsettled loan commitments are included in accrued expenses and accounts payable on the condensed consolidated balance sheets. |
Schedule of Financing Receivable Credit Quality Indicators | The following table presents the net book value of the Company’s loans held-for-investment portfolio as of March 31, 2023 by year of origination, loan type, and risk rating (dollar amounts in thousands): Amortized Cost of Loans Held-For-Investment by Year of Origination (1) As of March 31, 2023 Number of Loans 2023 2022 2021 2020 2019 Total First mortgage loans by internal risk rating: 1 — $ — $ — $ — $ — $ — $ — 2 1 — — — 87,702 — 87,702 3 24 — 1,167,412 1,509,502 72,804 49,509 2,799,227 4 3 — 80,467 231,255 — — 311,722 5 — — — — — — — Total first mortgage loans 28 — 1,247,879 1,740,757 160,506 49,509 3,198,651 Liquid corporate senior loans by internal risk rating: 1 — — — — — — — 2 2 — — — 5,285 — 5,285 3 303 17,033 127,230 371,650 159,915 2,317 678,145 4 9 — 3,248 6,240 8,029 — 17,517 5 1 (2) — 2,919 — — — 2,919 Total liquid corporate senior loans 315 17,033 133,397 377,890 173,229 2,317 703,866 Corporate senior loans by internal risk rating: 1 — — — — — — — 2 — — — — — — — 3 6 16,248 57,551 — — — 73,799 4 — — — — — — — 5 — — — — — — — Total corporate senior loans 6 16,248 57,551 — — — 73,799 Less: Current expected credit losses (43,779) Total loans held-for-investment and related receivables, net 349 $ 3,932,537 Weighted Average Risk Rating (3) 3.1 ____________________________________ (1) Date loan was originated or acquired by the Company. Origination dates are subsequently updated to reflect material loan modifications. (2) As of March 31, 2023, one of the Company’s liquid corporate senior loan investments was on nonaccrual status with a carrying value of $2.9 million, which represented less than 1% of the carrying value of the Company’s liquid corporate senior loans portfolio. |
DERIVATIVE INSTRUMENTS AND HE_2
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Derivative Instruments | The following table summarizes the terms of the Company’s interest rate cap agreements as of March 31, 2023 and December 31, 2022 (dollar amounts in thousands): Outstanding Notional Fair Value of Assets as of Balance Sheet Amount as of Strike Effective Maturity March 31, December 31, Location March 31, 2023 Rates Dates Dates 2023 2022 Interest Rate Caps Derivative assets, prepaid expenses and other assets $ 712,000 3.50% (1) to 4.00% (2) 7/15/2021 to 9/13/2022 7/15/2023 to 10/9/2023 $ 3,080 $ 5,040 ____________________________________ (1) The index used for this derivative instrument is 1-Month LIBOR. (2) The index used for this derivative instrument is 1-Month Term SOFR. |
REPURCHASE FACILITIES, NOTES _2
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The following table summarizes the debt balances as of March 31, 2023 and December 31, 2022, and the debt activity for the three months ended March 31, 2023 (in thousands): During the Three Months Ended March 31, 2023 Balance as of December 31, 2022 Debt Issuances & Assumptions (1) Repayments & Modifications (2) Amortization Balance as of Notes payable – fixed rate debt $ 36,538 $ — $ (36,538) $ — $ — Notes payable – variable rate debt 465,517 1,112 (5,569) — 461,060 First lien mortgage loan 121,940 — (121,940) — — ABS mortgage notes 763,035 — (1,935) — 761,100 Credit facilities 738,500 35,000 (240,000) — 533,500 Repurchase facilities 2,318,381 17,163 (111,796) — 2,223,748 Total debt 4,443,911 53,275 (517,778) — 3,979,408 Deferred costs – credit facility (3) (740) — 679 (4) 61 — Deferred costs – fixed rate debt and first lien mortgage loan (1,109) — 702 (4) 407 — Deferred costs – variable rate debt (5,261) (40) 602 (4) 488 (4,211) Deferred costs – ABS mortgage notes (13,968) (493) — 477 (13,984) Total debt, net $ 4,422,833 $ 52,742 $ (515,795) $ 1,433 $ 3,961,213 ____________________________________ (1) Includes deferred financing costs incurred during the period. (2) In connection with the repayment of certain mortgage notes and the termination of the CMFT Credit Facility, the Company recognized a loss on extinguishment of debt of $3.6 million during the three months ended March 31, 2023, which included $1.3 million in prepayment penalties. (3) Deferred costs related to the term portion of the CMFT Credit Facility (defined below). (4) In connection with the repayment of certain mortgage notes and the termination of the CMFT Credit Facility, the Company wrote off approximately $2.0 million of unamortized deferred loan costs. On July 28, 2021, the Company issued $774.0 million aggregate principal amount of asset backed securities (“ABS”) mortgage notes, Series 2021-1 (the “Class A Notes”) in six classes, as shown below: Class of Notes Initial Principal Balance Note Rate Anticipated Repayment Date Rated Final Payment Date Credit Rating (1) A-1 (AAA) $ 146,400,000 2.09% July 2028 July 2051 AAA (sf) A-2 (AAA) $ 219,600,000 2.57% July 2031 July 2051 AAA (sf) A-3 (AA) $ 39,200,000 2.51% July 2028 July 2051 AA (sf) A-4 (AA) $ 58,800,000 3.04% July 2031 July 2051 AA (sf) A-5 (A) $ 124,000,000 2.91% July 2028 July 2051 A (sf) A-6 (A) $ 186,000,000 3.44% July 2031 July 2051 A (sf) ____________________________________ (1) Reflects credit rating from Standard & Poor’s Financial Services LLC (“Standard & Poor’s”). |
Schedule of Repurchase Agreements | The following table is a summary of the Repurchase Facilities as of March 31, 2023 (dollar amounts in thousands): Repurchase Facility Date of Agreement Maturity Date (1) Maximum Facility Size Weighted Average Interest Rate Loans Financed under Repurchase Facility (2) Amount Financed Citibank 6/4/2020 8/17/2024 $ 400,000 6.5% (3) $ 468,204 $ 336,035 Barclays 9/21/2020 9/22/2025 1,250,000 6.6% (3) 1,097,301 806,317 Wells Fargo 5/20/2021 8/30/2025 750,000 6.4% (3) 898,108 696,712 Deutsche Bank 10/8/2021 10/8/2023 300,000 7.1% (3) 196,194 148,863 J.P. Morgan 6/1/2022 4/3/2023 (4) — (4) 5.9% (5) 416,242 235,821 Total $ 2,700,000 $ 3,076,049 $ 2,223,748 __________________________________ (1) As of March 31, 2023, the repurchase facility with Citibank and Wells Fargo each have two one-year extension options remaining, the repurchase facility with Barclays has one one-year extension option remaining and the repurchase facility with Deutsche Bank has four one-year extension options remaining. All repurchase facilities are subject to certain conditions set forth in their respective Repurchase Agreements. (2) CRE mortgage loan balances financed under the Repurchase Facilities with Citibank, Barclays, Wells Fargo and Deutsche Bank reflect the aggregate outstanding principal balance while the CMBS balance financed under the J.P. Morgan Repurchase Facility reflects fair value. (3) Advances under the Repurchase Agreements accrue interest at per annum rates based on the one-month LIBOR, Term SOFR (as such term is defined in the applicable Repurchase Agreement) or the daily compounded SOFR plus a spread ranging from 1.30% to 2.85% to be determined on a case-by-case basis between Citibank, Barclays,Wells Fargo or Deutsche Bank and the CMFT Lending Subs. (4) Facilities under the repurchase facility with J.P. Morgan (“J.P. Morgan Repurchase Facility”) carry a rolling term which is reset monthly. Such facilities carry no maximum facility size. (5) Under the Master Repurchase Agreement with J.P. Morgan, advances under the repurchase agreement may be made based on one-month Term SOFR plus a spread designated by J.P. Morgan, which as of March 31, 2023, ranges from 0.95% to 1.35%. |
Schedule of Maturities of Long-term Debt | The following table summarizes the scheduled aggregate principal repayments for the Company’s outstanding debt subsequent to March 31, 2023 (in thousands): Principal Repayments Remainder of 2023 $ 387,264 2024 373,576 2025 1,503,029 2026 — 2027 911,179 Thereafter 804,360 Total $ 3,979,408 |
RELATED-PARTY TRANSACTIONS AN_2
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Related Party Transactions [Abstract] | |
Schedule of Related Party Transactions | The Company recorded fees and expense reimbursements as shown in the table below for services provided by CMFT Management or its affiliates related to the services described above during the periods indicated (in thousands): Three Months Ended March 31, 2023 2022 Management fees $ 12,579 $ 13,347 Expense reimbursements to related parties $ 3,568 $ 3,694 |
LEASES (Tables)
LEASES (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Leases [Abstract] | |
Schedule of Future Minimum Rental Income from Operating Leases | As of March 31, 2023, the future minimum rental income from the Company’s real estate assets under non-cancelable operating leases, assuming no exercise of renewal options for the succeeding five fiscal years and thereafter, was as follows (in thousands): Future Minimum Rental Income Remainder of 2023 $ 68,750 2024 90,135 2025 89,882 2026 87,107 2027 84,717 Thereafter 645,156 Total $ 1,065,747 |
Schedule of Components of Lease Income | Rental and other property income during the three months ended March 31, 2023 and 2022 consisted of the following (in thousands): Three Months Ended March 31, 2023 2022 Fixed rental and other property income (1) $ 37,357 $ 64,706 Variable rental and other property income (2) 1,424 9,030 Total rental and other property income $ 38,781 $ 73,736 __________________________________ (1) Consists primarily of fixed contractual payments from operating leases with tenants recognized on a straight-line basis over the lease term, including amortization of acquired above- and below-market leases, and is net of uncollectible lease-related receivables. (2) Consists primarily of tenant reimbursements for recoverable real estate taxes and property operating expenses, and percentage rent. |
SEGMENT REPORTING (Tables)
SEGMENT REPORTING (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Information | The following tables present segment reporting for the three months ended March 31, 2023 and 2022 (in thousands): Real Estate Credit Corporate/Other (1) Company Total Three Months Ended March 31, 2023 Rental and other property income $ 38,715 $ — $ 66 $ 38,781 Interest income — 108,083 — 108,083 Total revenues 38,715 108,083 66 146,864 General and administrative 74 372 2,852 3,298 Interest expense, net 8,151 54,016 4,067 66,234 Property operating 1,684 — 892 2,576 Real estate tax 425 — 392 817 Expense reimbursements to related parties — — 3,568 3,568 Management fees 3,250 9,329 — 12,579 Transaction-related 13 — — 13 Depreciation and amortization 15,110 — — 15,110 Real estate impairment 4,814 — — 4,814 Increase in provision for credit losses — 1,453 — 1,453 Total expenses 33,521 65,170 11,771 110,462 Other income (expense): Gain on disposition of real estate and condominium developments, net 19,563 — 60 19,623 Loss on investment in unconsolidated entities — (770) — (770) Unrealized gain on equity security — 2,258 — 2,258 Other (expense) income, net (1,842) 1,843 323 324 Loss on extinguishment of debt (1,172) — (2,473) (3,645) Segment net income (loss) $ 21,743 $ 46,244 $ (13,795) $ 54,192 Net income allocated to noncontrolling interest 8 — — 8 Segment net income (loss) attributable to the Company $ 21,735 $ 46,244 $ (13,795) $ 54,184 Total assets as of March 31, 2023 $ 1,315,426 $ 4,725,168 $ 604,932 $ 6,645,526 __________________________________ (1) Includes condominium and rental units acquired via foreclosure during the year ended December 31, 2021. Real Estate Credit Corporate/Other (1) (2) Company Total Three Months Ended March 31, 2022 Rental and other property income $ 73,639 $ — $ 97 $ 73,736 Interest income — 31,463 — 31,463 Total revenues 73,639 31,463 97 105,199 General and administrative 149 230 3,096 3,475 Interest expense, net 15,078 11,612 3,306 29,996 Property operating 7,136 — 591 7,727 Real estate tax 6,350 — 363 6,713 Expense reimbursements to related parties — — 3,694 3,694 Management fees 7,131 6,216 — 13,347 Transaction-related 7 — — 7 Depreciation and amortization 19,141 — — 19,141 Real estate impairment 3,291 — — 3,291 Increase in provision for credit losses — 4,709 — 4,709 Total expenses 58,283 22,767 11,050 92,100 Other income (expense): Gain on disposition of real estate and condominium developments, net 29,265 — 3,309 32,574 Gain on investment in unconsolidated entities — 168 5,172 5,340 Unrealized (loss) gain on equity security — (2,368) 22 (2,346) Other income, net 1,239 66 — 1,305 Loss on extinguishment of debt (10,737) — (134) (10,871) Segment net income (loss) $ 35,123 $ 6,562 $ (2,584) $ 39,101 Net income allocated to noncontrolling interest 9 — — 9 Segment net income (loss) attributable to the Company $ 35,114 $ 6,562 $ (2,584) $ 39,092 Total assets as of March 31, 2022 $ 2,919,412 $ 3,767,306 $ 281,702 $ 6,968,420 __________________________________ (1) Includes condominium and rental units acquired via foreclosure during the year ended December 31, 2021. (2) Includes the Company’s investment in CIM UII Onshore, L.P. (“CIM UII Onshore”). |
ORGANIZATION AND BUSINESS (Deta
ORGANIZATION AND BUSINESS (Details) $ / shares in Units, ft² in Millions | 3 Months Ended | |||||||||
Apr. 04, 2014 shares | Mar. 31, 2023 USD ($) ft² loan property state $ / shares shares | Dec. 31, 2022 USD ($) shares | Dec. 29, 2022 state | Dec. 21, 2022 $ / shares | Dec. 20, 2021 state | Aug. 02, 2016 USD ($) | Jun. 30, 2016 USD ($) shares | Dec. 19, 2013 USD ($) | Jan. 26, 2012 USD ($) | |
Organization and Business [Line Items] | ||||||||||
Number of real estate properties | property | 228 | |||||||||
Rentable commercial space (sqft) | ft² | 6.9 | |||||||||
Number of states in which entity owns properties | state | 37 | 34 | 27 | |||||||
Percentage of rentable space leased | 98.90% | |||||||||
Number of loans | loan | 349 | |||||||||
Net book value | $ 3,932,537,000 | $ 4,001,554,000 | ||||||||
Real estate-related securities ($520,639 and $576,391 held at fair value as of March 31, 2023 and December 31, 2022, respectively) | 520,639,000 | 576,391,000 | ||||||||
Real estate investment property, at cost | $ 1,498,303,000 | $ 2,448,874,000 | ||||||||
Common stock, shares issued (in shares) | shares | 297,400,000 | 437,429,808 | 437,397,414 | |||||||
Common stock, shares deregistered (shares) | shares | 404,000 | |||||||||
NAV per share (in usd per share) | $ / shares | $ 6.57 | |||||||||
IPO | ||||||||||
Organization and Business [Line Items] | ||||||||||
Common stock, shares authorized, value (maximum) | $ 2,975,000,000 | |||||||||
Common stock, shares issued (in shares) | shares | 292,300,000 | |||||||||
Distribution Reinvestment Plan | ||||||||||
Organization and Business [Line Items] | ||||||||||
Common stock, shares issued (in shares) | shares | 5,100,000 | 241,700,000 | ||||||||
Common stock shares registered dividend reinvestment plan, value | $ 600,000,000 | $ 247,000,000 | ||||||||
Remaining unsold common stock | $ 5,300,000 | |||||||||
Share price (in usd per share) | $ / shares | $ 6.57 | |||||||||
CCPT IV OP | ||||||||||
Organization and Business [Line Items] | ||||||||||
General partner partnership interest percentage | 100% | |||||||||
Condominium developments | ||||||||||
Organization and Business [Line Items] | ||||||||||
Real estate investment property, at cost | $ 131,600,000 |
SUMMARY OF SIGNIFICANT ACCOUN_4
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reclassifications (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2022 | |
Accounting Policies [Abstract] | |||
Interest expense, net | $ 66,234 | $ 29,996 | |
Unrealized loss on equity securities | 2,300 | ||
Accrued interest receivable | 23,412 | 7,200 | $ 22,343 |
Derivative assets, prepaid expenses and other assets | $ 10,711 | $ 2,800 | $ 26,243 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Derivative assets, prepaid expenses and other assets | Derivative assets, prepaid expenses and other assets |
SUMMARY OF SIGNIFICANT ACCOUN_5
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Real Estate Assets (Details) | 3 Months Ended |
Mar. 31, 2023 | |
Buildings | |
Real Estate Properties [Line Items] | |
Property, plant and equipment, useful life | 40 years |
Site improvements | |
Real Estate Properties [Line Items] | |
Property, plant and equipment, useful life | 15 years |
SUMMARY OF SIGNIFICANT ACCOUN_6
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Recoverability of Real Estate Assets (Details) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 USD ($) property | Mar. 31, 2022 USD ($) property | |
Accounting Policies [Abstract] | ||
Impairment of real estate assets | $ | $ 4.8 | $ 3.3 |
Impairment of real estate, number of properties | property | 1 | 7 |
SUMMARY OF SIGNIFICANT ACCOUN_7
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Assets Held for Sale (Details) $ in Millions | Mar. 31, 2023 USD ($) loan | Mar. 31, 2022 USD ($) property |
Accounting Policies [Abstract] | ||
Number of real estate property held for sale | 27 | 26 |
Assets held for sale | $ 65 | $ 487.5 |
SUMMARY OF SIGNIFICANT ACCOUN_8
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Investments in Unconsolidated Entities (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||
Loss (gain) on investment in unconsolidated entities | $ (770) | $ 5,340 | |
Return on investment in unconsolidated entities | $ 0 | $ 531 | |
New Point JV, LLC | N P J V Holdings | |||
Schedule of Equity Method Investments [Line Items] | |||
Noncontrolling interest, ownership percentage by parent | 90% | ||
N P J V Holdings | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 50% | 50% | |
Equity method investments | $ 97,400 | ||
New Point JV, LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 45% | ||
Loss (gain) on investment in unconsolidated entities | $ (770) | ||
Equity method investments | 97,400 | ||
Return on investment in unconsolidated entities | $ 2,400 | ||
C I M U I I Onshore | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 5% | ||
Loss (gain) on investment in unconsolidated entities | $ 5,200 | ||
Equity method investments | 60,700 | ||
Return on investment in unconsolidated entities | $ 531 |
SUMMARY OF SIGNIFICANT ACCOUN_9
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Restricted Cash (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Restricted cash | $ 58,390 | $ 57,616 | $ 72,486 |
Cash collateral included in restricted cash | 19,600 | 19,600 | |
Restricted Lockbox Accounts | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Restricted cash | 16,800 | 15,400 | |
Escrow Deposits | |||
Restricted Cash and Cash Equivalents Items [Line Items] | |||
Restricted cash | $ 22,000 | $ 22,600 |
SUMMARY OF SIGNIFICANT ACCOU_10
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Real Estate-Related Securities (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) security | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Debt Securities, Available-for-sale [Line Items] | |||
Fair Value | $ 520,639 | $ 576,391 | |
Unrealized gain (loss) on equity security | 2,258 | $ (2,368) | |
Capitalized interest income on real estate-related securities | 284 | $ 272 | |
CMBS | |||
Debt Securities, Available-for-sale [Line Items] | |||
Net investments in debt securities | $ 9,400 | ||
Number of debt instruments | security | 18 | ||
Fair Value | $ 480,133 | ||
Unrealized gain (loss) on equity security | 2,300 | ||
RTL Common Stock | |||
Debt Securities, Available-for-sale [Line Items] | |||
Investments redeemed | 40,500 | ||
Dividend income, equity securities operating | 1,400 | ||
Equity security | |||
Debt Securities, Available-for-sale [Line Items] | |||
Fair Value | $ 40,506 |
SUMMARY OF SIGNIFICANT ACCOU_11
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Loans Held-for-Investments (Details) - Liquid corporate senior loans $ in Millions | Mar. 31, 2023 USD ($) |
Fair Value, Option, Quantitative Disclosures [Line Items] | |
Nonaccrual status with a carrying value | $ 2.9 |
Percentage carrying value of loan portfolio (less than) | 1% |
SUMMARY OF SIGNIFICANT ACCOU_12
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Development Activities (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Condominium developments | $ 131,633 | $ 130,494 | |
Capitalized interest cost | 458 | $ 387 | |
Condominium Units | |||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||
Condominium developments | $ 2,700 | $ 3,100 |
SUMMARY OF SIGNIFICANT ACCOU_13
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Reportable Segment (Details) | 3 Months Ended |
Mar. 31, 2023 segment | |
Accounting Policies [Abstract] | |
Number of reportable segments | 2 |
FAIR VALUE MEASUREMENTS - Narra
FAIR VALUE MEASUREMENTS - Narrative (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) property | Mar. 31, 2022 USD ($) property state | Dec. 31, 2022 USD ($) | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
CMBS | $ 520,639 | $ 576,391 | |
Impairment of real estate, number of properties | property | 1 | 7 | |
Impairment of real estate assets | $ 4,800 | $ 3,300 | |
Number of properties impaired | state | 7 | ||
Fair Value, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
CMBS | 480,133 | 538,142 | |
Carrying Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Loans receivable, fair value disclosure | 3,930,000 | 4,000,000 | |
Carrying value of impaired property | 9,600 | $ 32,400 | |
Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Loans receivable, fair value disclosure | 3,910,000 | 3,980,000 | |
Carrying value of impaired property | 4,800 | $ 29,100 | |
Level 2 | Fair Value, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
CMBS | 307,507 | 348,241 | |
Level 2 | Carrying Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Company's debt | 3,980,000 | 4,440,000 | |
Level 2 | Fair Value | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Company's debt | 3,860,000 | 4,320,000 | |
Level 2 | Fair Value | Syndicated Loans | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Loans receivable, fair value disclosure | 542,200 | 494,400 | |
Level 3 | Fair Value, Recurring | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
CMBS | 172,626 | 189,901 | |
Level 3 | Fair Value | Syndicated Loans | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Loans receivable, fair value disclosure | $ 129,500 | $ 168,000 |
FAIR VALUE MEASUREMENTS - Sched
FAIR VALUE MEASUREMENTS - Schedule of Fair Value, Assets and Liabilities Measured on a Recurring Basis (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Financial assets: | ||
CMBS | $ 520,639 | $ 576,391 |
Equity security | 520,639 | 576,391 |
Fair Value, Recurring | ||
Financial assets: | ||
CMBS | 480,133 | 538,142 |
Total financial assets | 523,719 | 581,431 |
Fair Value, Recurring | Interest Rate Caps | ||
Financial assets: | ||
Interest rate caps | 3,080 | 5,040 |
Fair Value, Recurring | Equity security | ||
Financial assets: | ||
Equity security | 40,506 | 38,249 |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Financial assets: | ||
CMBS | 0 | 0 |
Total financial assets | 40,506 | 38,249 |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest Rate Caps | ||
Financial assets: | ||
Interest rate caps | 0 | 0 |
Fair Value, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Equity security | ||
Financial assets: | ||
Equity security | 40,506 | 38,249 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | ||
Financial assets: | ||
CMBS | 307,507 | 348,241 |
Total financial assets | 310,587 | 353,281 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | Interest Rate Caps | ||
Financial assets: | ||
Interest rate caps | 3,080 | 5,040 |
Fair Value, Recurring | Significant Other Observable Inputs (Level 2) | Equity security | ||
Financial assets: | ||
Equity security | 0 | 0 |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | ||
Financial assets: | ||
CMBS | 172,626 | 189,901 |
Total financial assets | 172,626 | 189,901 |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | Interest Rate Caps | ||
Financial assets: | ||
Interest rate caps | 0 | 0 |
Fair Value, Recurring | Significant Unobservable Inputs (Level 3) | Equity security | ||
Financial assets: | ||
Equity security | $ 0 | $ 0 |
FAIR VALUE MEASUREMENTS - Level
FAIR VALUE MEASUREMENTS - Level 3 Reconciliation (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Total gains and losses: | |
Fair Value Recurring Basis Unobservable Input Reconciliation Liability Gain Loss Statement Of Other Comprehensive Income Extensible List Not Disclosed Flag | Unrealized loss included in other comprehensive loss, net |
Level 3 | |
Fair Value, Liabilities Measured on Recurring Basis, Unobservable Input Reconciliation, Calculation [Roll Forward] | |
Beginning balance | $ 189,901 |
Total gains and losses: | |
Unrealized loss included in other comprehensive loss, net | (21,911) |
Purchases and payments received: | |
Discounts, net | 4,352 |
Capitalized interest income | 284 |
Ending balance | $ 172,626 |
FAIR VALUE MEASUREMENTS - Disco
FAIR VALUE MEASUREMENTS - Discount Rates and Terminal Capitalization Rates (Details) | Mar. 31, 2023 | Mar. 31, 2022 |
Minimum | Discount Rate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 8% | |
Minimum | Terminal Capitalization Rate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 7.50% | 7.50% |
Maximum | Discount Rate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 9.70% | 9.70% |
Maximum | Terminal Capitalization Rate | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Discount rate | 9.20% | 9.20% |
FAIR VALUE MEASUREMENTS - Summa
FAIR VALUE MEASUREMENTS - Summary of Impairment Charges by Asset Class (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment of real estate assets | $ 4,814 | $ 3,291 |
Intangible lease liabilities | 0 | (1) |
Land | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment of real estate assets | 1,144 | 964 |
Buildings, fixtures and improvements | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment of real estate assets | 3,652 | 1,974 |
Intangible lease assets | ||
Impaired Long-Lived Assets Held and Used [Line Items] | ||
Impairment of real estate assets | $ 18 | $ 354 |
REAL ESTATE ASSETS - Property A
REAL ESTATE ASSETS - Property Acquisition (Details) - property | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Commercial Real Estate | ||
Real Estate [Line Items] | ||
Number of properties acquired | 0 | 0 |
REAL ESTATE ASSETS - Condominiu
REAL ESTATE ASSETS - Condominium Development Project and Dispositions (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) condominiumUnit | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Real Estate [Line Items] | |||
Condominium developments | $ 131,633 | $ 130,494 | |
Net proceeds from disposition of real estate assets and condominium developments | 775,144 | $ 923,400 | |
Gain on disposition of real estate, net | 19,623 | 32,574 | |
Condominium Units | |||
Real Estate [Line Items] | |||
Condominium developments | $ 2,700 | 3,100 | |
Condominium Dispositions | |||
Real Estate [Line Items] | |||
Number of condominium units sold | condominiumUnit | 1 | ||
Aggregate gross sales price | $ 1,600 | 21,100 | |
Net proceeds from disposition of real estate assets and condominium developments | 1,500 | 19,400 | |
Gain on disposition of real estate, net | $ 60 | $ 3,300 |
REAL ESTATE ASSETS - Property D
REAL ESTATE ASSETS - Property Dispositions and Real Estate Assets Held for Sale (Details) $ / shares in Units, $ in Thousands, ft² in Millions | 3 Months Ended | ||||
Dec. 29, 2022 USD ($) ft² property state | Dec. 20, 2021 USD ($) ft² property state center $ / shares | Mar. 31, 2023 USD ($) loan state property $ / shares | Mar. 31, 2022 USD ($) property | Dec. 31, 2022 USD ($) $ / shares | |
Real Estate [Line Items] | |||||
Number of real estate property held for sale | 27 | 26 | |||
Number of states in which entity owns properties | state | 34 | 27 | 37 | ||
Net proceeds from disposition of real estate assets and condominium developments | $ 775,144 | $ 923,400 | |||
Gain on disposition of real estate, net | 19,623 | 32,574 | |||
Common stock, value, issued (in share) | 4,374 | $ 4,373 | |||
Assets held for sale | $ 65,000 | $ 487,500 | |||
Common stock, par value (USD per share) | $ / shares | $ 0.01 | $ 0.01 | |||
Property Disposition 2023 | |||||
Real Estate [Line Items] | |||||
Area of real estate property | ft² | 4.6 | ||||
Aggregate gross sales price | $ 894,000 | ||||
Proceeds from sale of productive assets in cash | $ 771,500 | ||||
Property Disposition 2023 | Properties Sold | |||||
Real Estate [Line Items] | |||||
Number of properties disposed | property | 152 | ||||
Aggregate gross sales price | $ 781,200 | ||||
Net proceeds from disposition of real estate assets and condominium developments | 773,700 | ||||
Gain on disposition of real estate, net | 19,600 | ||||
Property Disposition 2023 | AFIN | |||||
Real Estate [Line Items] | |||||
Common stock, value, issued (in share) | 19,500 | ||||
Purchase And Sale Agreement | |||||
Real Estate [Line Items] | |||||
Number of real estate property held for sale | property | 25 | ||||
Aggregate gross sales price | $ 779,000 | $ 811,800 | |||
Number of properties disposed | property | 151 | 56 | |||
Other receivables | $ 21,300 | ||||
Property Disposition 2022 | |||||
Real Estate [Line Items] | |||||
Area of real estate property | ft² | 9.5 | ||||
Aggregate gross sales price | $ 1,320,000 | ||||
Proceeds from sale of productive assets in cash | 758,400 | ||||
Earnout income (loss) on disposition | 31,500 | ||||
Property Disposition 2022 | Properties Sold | |||||
Real Estate [Line Items] | |||||
Aggregate gross sales price | $ 925,300 | ||||
Number of properties disposed | property | 69 | ||||
Net proceeds from disposition of real estate assets and condominium developments | $ 923,200 | ||||
Gain on disposition of real estate, net | 29,200 | ||||
Property Disposition 2022 | AFIN | |||||
Real Estate [Line Items] | |||||
Common stock, value, issued (in share) | $ 53,400 | $ 53,400 | |||
Common stock, par value (USD per share) | $ / shares | $ 0.01 | ||||
Shopping Center | Property Disposition 2021 | |||||
Real Estate [Line Items] | |||||
Number of properties disposed | center | 79 | ||||
Single-Tenant Properties | Property Disposition 2023 | |||||
Real Estate [Line Items] | |||||
Number of real estate property held for sale | property | 185 | ||||
Single-Tenant Properties | Property Disposition 2022 | |||||
Real Estate [Line Items] | |||||
Number of real estate property held for sale | property | 2 | ||||
Retail Property | Property Disposition 2023 | Properties Sold | |||||
Real Estate [Line Items] | |||||
Number of properties disposed | property | 150 | ||||
Retail Property | Property Disposition 2022 | Properties Sold | |||||
Real Estate [Line Items] | |||||
Number of properties disposed | property | 32 | ||||
Anchored Shopping Center | Property Disposition 2022 | |||||
Real Estate [Line Items] | |||||
Number of properties disposed | property | 37 | ||||
Industrial Property | Property Disposition 2023 | Properties Sold | |||||
Real Estate [Line Items] | |||||
Number of properties disposed | property | 2 |
REAL ESTATE ASSETS - Impairment
REAL ESTATE ASSETS - Impairment (Details) ft² in Thousands, $ in Millions | 3 Months Ended | |
Mar. 31, 2023 USD ($) ft² property | Mar. 31, 2022 USD ($) ft² property | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Impairment of real estate, number of properties | property | 1 | 7 |
Area of real estate property impaired | ft² | 45 | 215 |
Impairment of real estate assets | $ 4.8 | $ 3.3 |
Carrying Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate asset deemed to be impaired | 9.6 | 32.4 |
Fair Value | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Real estate asset deemed to be impaired | $ 4.8 | $ 29.1 |
INTANGIBLE LEASE ASSETS AND L_3
INTANGIBLE LEASE ASSETS AND LIABILITIES - Components (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 | Dec. 31, 2022 | |
Intangible lease assets: | ||
Intangible leased assets | $ 115,149 | $ 185,593 |
Intangible lease liabilities: | ||
Acquired below market liabilities, net | 14,269 | 19,054 |
Below market lease, accumulated amortization | $ 4,221 | $ 5,575 |
Below market lease, weighted average useful life | 12 years 9 months 18 days | 12 years 4 months 24 days |
In-place leases and other intangibles | ||
Intangible lease assets: | ||
Intangible leased assets | $ 110,887 | $ 174,954 |
Accumulated amortization of intangible lease assets | $ 46,214 | $ 86,881 |
Useful life | 11 years 8 months 12 days | 11 years 1 month 6 days |
Acquired above-market leases | ||
Intangible lease assets: | ||
Intangible leased assets | $ 4,262 | $ 10,639 |
Accumulated amortization of intangible lease assets | $ 2,773 | $ 4,210 |
Useful life | 11 years 8 months 12 days | 12 years 10 months 24 days |
INTANGIBLE LEASE ASSETS AND L_4
INTANGIBLE LEASE ASSETS AND LIABILITIES - Schedule of Finite-Lived Intangible Assets Amortization Expense (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Finite-Lived Intangible Assets [Line Items] | ||
Below-market lease amortization | $ 433 | $ 579 |
In-place lease and other intangible amortization | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of intangible assets | 5,082 | 6,786 |
Above-market lease amortization | ||
Finite-Lived Intangible Assets [Line Items] | ||
Amortization of intangible assets | $ 234 | $ 316 |
INTANGIBLE LEASE ASSETS AND L_5
INTANGIBLE LEASE ASSETS AND LIABILITIES - Schedule of Finite-lived Intangible Assets and Liabilities, Future Amortization Expense (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Amortiztaion, In-Place Leases and Other Intangibles, Above-Market Leases | ||
Total | $ 115,149 | $ 185,593 |
Amortization, Below-Market Leases | ||
Remainder of 2023 | 915 | |
2024 | 1,126 | |
2025 | 1,120 | |
2026 | 1,120 | |
2027 | 1,120 | |
Thereafter | 8,868 | |
Total | 14,269 | 19,054 |
In-Place Leases and Other Intangibles | ||
Amortiztaion, In-Place Leases and Other Intangibles, Above-Market Leases | ||
Remainder of 2023 | 9,139 | |
2024 | 11,694 | |
2025 | 11,300 | |
2026 | 10,092 | |
2027 | 9,292 | |
Thereafter | 59,370 | |
Total | 110,887 | 174,954 |
Above-Market Leases | ||
Amortiztaion, In-Place Leases and Other Intangibles, Above-Market Leases | ||
Remainder of 2023 | 348 | |
2024 | 424 | |
2025 | 424 | |
2026 | 379 | |
2027 | 356 | |
Thereafter | 2,331 | |
Total | $ 4,262 | $ 10,639 |
INVESTMENT IN UNCONSOLIDATED _2
INVESTMENT IN UNCONSOLIDATED ENTITIES (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Dec. 31, 2021 | |
Schedule of Equity Method Investments [Line Items] | |||
Return on investment in unconsolidated entities | $ 0 | $ 531 | |
Loss (gain) on investment in unconsolidated entities | $ (770) | $ 5,340 | |
New Point JV, LLC | N P J V Holdings | |||
Schedule of Equity Method Investments [Line Items] | |||
Noncontrolling interest, ownership percentage by parent | 90% | ||
N P J V Holdings | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 50% | 50% | |
Equity method investments | $ 97,400 | ||
New Point JV, LLC | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 45% | ||
Equity method investments | $ 97,400 | ||
Return on investment in unconsolidated entities | 2,400 | ||
Loss (gain) on investment in unconsolidated entities | $ (770) | ||
C I M U I I Onshore | |||
Schedule of Equity Method Investments [Line Items] | |||
Equity method investment, ownership percentage | 5% | ||
Equity method investments | $ 60,700 | ||
Return on investment in unconsolidated entities | 531 | ||
Loss (gain) on investment in unconsolidated entities | 5,200 | ||
Investments redeemed | $ 60,700 |
REAL ESTATE-RELATED SECURITIE_2
REAL ESTATE-RELATED SECURITIES - Narrative (Details) | 3 Months Ended | ||
Mar. 31, 2023 USD ($) security | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Debt Instrument [Line Items] | |||
CMBS | $ 520,639,000 | $ 576,391,000 | |
Unrealized loss on real estate-related securities | (26,300,000) | ||
Unrealized loss on equity security | 2,258,000 | $ (2,368,000) | |
Credit losses | 24,053,000 | ||
CMBS | |||
Debt Instrument [Line Items] | |||
CMBS | $ 520,600,000 | ||
Number of debt instruments | security | 18 | ||
Net investments in debt securities | $ 9,400,000 | ||
Unrealized loss on equity security | 2,300,000 | ||
Credit losses | $ 0 | ||
CMBS Two | Minimum | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 6.20% | ||
CMBS Two | Maximum | |||
Debt Instrument [Line Items] | |||
Stated interest rate | 12.20% | ||
CMBS One | |||
Debt Instrument [Line Items] | |||
Number of debt instruments | security | 1 | ||
Stated interest rate | 0% |
REAL ESTATE-RELATED SECURITIE_3
REAL ESTATE-RELATED SECURITIES - Summary of Real Estate Securities (Details) $ in Thousands | Mar. 31, 2023 USD ($) tranche | Dec. 31, 2022 USD ($) |
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost Basis | $ 608,338 | $ 640,037 |
Unrealized Loss | (87,699) | (63,646) |
Fair Value | 520,639 | $ 576,391 |
CMBS | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost Basis | 554,950 | |
Unrealized Loss | (74,817) | |
Fair Value | $ 480,133 | |
Number of tranches | tranche | 2 | |
Equity security | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost Basis | $ 53,388 | |
Unrealized Loss | (12,882) | |
Fair Value | $ 40,506 |
REAL ESTATE-RELATED SECURITIE_4
REAL ESTATE-RELATED SECURITIES - Activity for the Real Estate-Related Securities (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Amortized Cost Basis | ||
Beginning balance | $ 640,037 | |
Face value of real estate-related securities acquired | 9,738 | |
Premiums and discounts on purchase of real estate-related securities, net of acquisition costs | (336) | |
Amortization of discount on real estate-related securities | 7,590 | |
Capitalized interest income on real estate-related securities | 284 | $ 272 |
Principal payments received on real estate-related securities | (48,975) | |
Ending balance | 608,338 | |
Unrealized Loss | ||
Beginning balance | (63,646) | |
Realized gain on sale of real estate-related securities | 0 | (22) |
Unrealized loss on real estate-related securities | (24,053) | |
Ending balance | (87,699) | |
Fair Value | ||
Beginning balance | 576,391 | |
Face value of real estate-related securities acquired | 9,738 | |
Premiums and discounts on purchase of real estate-related securities, net of acquisition costs | (336) | |
Amortization of discount on real estate-related securities | 7,590 | |
Capitalized interest income on real estate-related securities | 284 | $ 272 |
Unrealized loss on real estate-related securities | (24,053) | |
Ending balance | $ 520,639 |
REAL ESTATE-RELATED SECURITIE_5
REAL ESTATE-RELATED SECURITIES - The Scheduled Maturities of Real Estate-Related Securities (Details) - CMBS $ in Thousands | Mar. 31, 2023 USD ($) |
Amortized Cost | |
Due within one year | $ 364,798 |
Due after one year through five years | 148,125 |
Due after five years through ten years | 0 |
Due after ten years | 42,027 |
Total | 554,950 |
Estimated Fair Value | |
Due within one year | 312,595 |
Due after one year through five years | 136,452 |
Due after five years through ten years | 0 |
Due after ten years | 31,086 |
Total | $ 480,133 |
LOANS HELD-FOR-INVESTMENT - Sch
LOANS HELD-FOR-INVESTMENT - Schedule of Loans Held for Investment (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Oct. 31, 2021 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans held-for-investment and related receivables, net | $ 3,976,316 | $ 4,043,898 | |
Less: Current expected credit losses | (43,779) | (42,344) | |
Net book value | 3,932,537 | 4,001,554 | |
Contiguous mezzanine loan components | 20,100 | ||
First Mortgage Loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans held-for-investment and related receivables, net | 3,198,651 | 3,285,193 | $ 130,000 |
Less: Current expected credit losses | (22,301) | (20,352) | |
Total CRE loans held-for-investment and related receivables, net | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans held-for-investment and related receivables, net | 3,198,651 | 3,285,193 | |
Net book value | 3,176,350 | 3,264,841 | |
Liquid corporate senior loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans held-for-investment and related receivables, net | 703,866 | 701,540 | |
Less: Current expected credit losses | (20,281) | (21,195) | |
Net book value | 683,585 | 680,345 | |
Corporate senior loans | |||
Accounts, Notes, Loans and Financing Receivable [Line Items] | |||
Loans held-for-investment and related receivables, net | 73,799 | 57,165 | |
Less: Current expected credit losses | (1,197) | (797) | |
Net book value | $ 72,602 | $ 56,368 |
LOANS HELD-FOR-INVESTMENT - Sta
LOANS HELD-FOR-INVESTMENT - Statistics (Details) $ in Thousands | 3 Months Ended | 12 Months Ended |
Mar. 31, 2023 USD ($) loan | Dec. 31, 2022 USD ($) loan | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of loans | loan | 349 | |
Net book value | $ 3,932,537 | $ 4,001,554 |
Loans receivable with variable rate of interest | 100% | |
Unfunded Loan Commitment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unfunded loan commitments | $ 292,700 | |
Unfunded or Unsettled Liquid Senior Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unfunded loan commitments | $ 18,000 | |
CRE Loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of loans | loan | 28 | 29 |
Principal balance | $ 3,216,545 | $ 3,306,411 |
Net book value | $ 3,176,350 | $ 3,264,841 |
Weighted-average interest rate | 8% | 7.60% |
Weighted-average maximum years to maturity | 3 years 4 months 24 days | 3 years 7 months 6 days |
CRE Loans | Unfunded Loan Commitment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unfunded loan commitments | $ 287,515 | $ 304,649 |
Liquid corporate senior loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of loans | loan | 315 | 317 |
Principal balance | $ 710,334 | $ 708,254 |
Net book value | $ 683,585 | $ 680,345 |
Weighted-average interest rate | 8.50% | 8% |
Weighted-average maximum years to maturity | 4 years 7 months 6 days | 4 years 8 months 12 days |
Liquid corporate senior loans | Unfunded Loan Commitment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unfunded loan commitments | $ 1,425 | $ 1,425 |
Corporate senior loans | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Number of loans | loan | 6 | 4 |
Principal balance | $ 74,917 | $ 57,918 |
Net book value | $ 72,602 | $ 56,368 |
Weighted-average interest rate | 11.30% | 10.50% |
Weighted-average maximum years to maturity | 4 years 4 months 24 days | 4 years 7 months 6 days |
Corporate senior loans | Unfunded Loan Commitment | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Unfunded loan commitments | $ 3,794 | $ 4,324 |
LOANS HELD-FOR-INVESTMENT - Act
LOANS HELD-FOR-INVESTMENT - Activity (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Beginning Balance, Net Book Value | $ 4,001,554 |
Loan originations and acquisitions | 61,710 |
Sale of loans | (8,311) |
Principal repayments received | (123,996) |
Deferred fees and other items | (1,200) |
Accretion and amortization of fees and other items | 4,215 |
Current expected credit losses | (1,435) |
Ending Balance, Net Book Value | 3,932,537 |
CRE Loans | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Beginning Balance, Net Book Value | 3,264,841 |
Loan originations and acquisitions | 17,007 |
Sale of loans | 0 |
Principal repayments received | (106,873) |
Deferred fees and other items | 0 |
Accretion and amortization of fees and other items | 3,324 |
Current expected credit losses | (1,949) |
Ending Balance, Net Book Value | 3,176,350 |
Liquid corporate senior loans | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Beginning Balance, Net Book Value | 680,345 |
Loan originations and acquisitions | 27,521 |
Sale of loans | (8,311) |
Principal repayments received | (16,940) |
Deferred fees and other items | (780) |
Accretion and amortization of fees and other items | 836 |
Current expected credit losses | 914 |
Ending Balance, Net Book Value | 683,585 |
Corporate senior loans | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Beginning Balance, Net Book Value | 56,368 |
Loan originations and acquisitions | 17,182 |
Sale of loans | 0 |
Principal repayments received | (183) |
Deferred fees and other items | (420) |
Accretion and amortization of fees and other items | 55 |
Current expected credit losses | (400) |
Ending Balance, Net Book Value | 72,602 |
First Mortgage Loans | |
Accounts, Notes, Loans and Financing Receivable [Line Items] | |
Principal repayments received | $ (105,000) |
LOANS HELD-FOR-INVESTMENT - All
LOANS HELD-FOR-INVESTMENT - Allowance for Financing Receivable (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | $ 42,344 | |
Provision for (reversal of) credit losses | 1,453 | $ 4,709 |
Current expected credit losses as of end of the period | 43,779 | |
Gross Credit Losses | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | 44,677 | |
Current expected credit losses as of end of the period | 46,130 | |
First Mortgage Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | 20,352 | |
Provision for (reversal of) credit losses | 1,949 | |
Current expected credit losses as of end of the period | 22,301 | |
Unfunded First Mortgage Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | 1,890 | |
Provision for (reversal of) credit losses | 138 | |
Current expected credit losses as of end of the period | 2,028 | |
Liquid Corporate Senior Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | 21,195 | |
Provision for (reversal of) credit losses | (914) | |
Current expected credit losses as of end of the period | 20,281 | |
Unfunded or Unsettled Liquid Senior Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | 377 | |
Provision for (reversal of) credit losses | (121) | |
Current expected credit losses as of end of the period | 256 | |
Corporate Senior Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | 797 | |
Provision for (reversal of) credit losses | 400 | |
Current expected credit losses as of end of the period | 1,197 | |
Unfunded Corporate Senior Loans | ||
Financing Receivable, Allowance for Credit Loss [Roll Forward] | ||
Current expected credit losses as of beginning of the period | 66 | |
Provision for (reversal of) credit losses | 1 | |
Current expected credit losses as of end of the period | $ 67 |
LOANS HELD-FOR-INVESTMENT - S_2
LOANS HELD-FOR-INVESTMENT - Schedule of Primary Credit Quality Indicator (Details) $ in Thousands | Mar. 31, 2023 USD ($) loan | Dec. 31, 2022 USD ($) | Oct. 31, 2021 USD ($) |
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 349 | ||
Loans held-for-investment and related receivables, net | $ 3,976,316 | $ 4,043,898 | |
Less: Current expected credit losses | (43,779) | (42,344) | |
Total loans held-for-investment and related receivables, net | $ 3,932,537 | 4,001,554 | |
Weighted Average Risk Rating | 3.1 | ||
Liquid corporate senior loans | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Nonaccrual status with a carrying value | $ 2,900 | ||
Percentage carrying value of loan portfolio (less than) | 1% | ||
First Mortgage Loans | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 28 | ||
2023 | $ 0 | ||
2022 | 1,247,879 | ||
2021 | 1,740,757 | ||
2020 | 160,506 | ||
2019 | 49,509 | ||
Loans held-for-investment and related receivables, net | 3,198,651 | 3,285,193 | $ 130,000 |
Less: Current expected credit losses | $ (22,301) | (20,352) | |
First Mortgage Loans | 1 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 0 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 0 | ||
First Mortgage Loans | 2 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 1 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 87,702 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 87,702 | ||
First Mortgage Loans | 3 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 24 | ||
2023 | $ 0 | ||
2022 | 1,167,412 | ||
2021 | 1,509,502 | ||
2020 | 72,804 | ||
2019 | 49,509 | ||
Loans held-for-investment and related receivables, net | $ 2,799,227 | ||
First Mortgage Loans | 4 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 3 | ||
2023 | $ 0 | ||
2022 | 80,467 | ||
2021 | 231,255 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 311,722 | ||
First Mortgage Loans | 5 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 0 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 0 | ||
Liquid corporate senior loans | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 315 | ||
2023 | $ 17,033 | ||
2022 | 133,397 | ||
2021 | 377,890 | ||
2020 | 173,229 | ||
2019 | 2,317 | ||
Loans held-for-investment and related receivables, net | 703,866 | 701,540 | |
Less: Current expected credit losses | (20,281) | (21,195) | |
Total loans held-for-investment and related receivables, net | $ 683,585 | 680,345 | |
Liquid corporate senior loans | 1 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 0 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 0 | ||
Liquid corporate senior loans | 2 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 2 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 5,285 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 5,285 | ||
Liquid corporate senior loans | 3 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 303 | ||
2023 | $ 17,033 | ||
2022 | 127,230 | ||
2021 | 371,650 | ||
2020 | 159,915 | ||
2019 | 2,317 | ||
Loans held-for-investment and related receivables, net | $ 678,145 | ||
Liquid corporate senior loans | 4 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 9 | ||
2023 | $ 0 | ||
2022 | 3,248 | ||
2021 | 6,240 | ||
2020 | 8,029 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 17,517 | ||
Liquid corporate senior loans | 5 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 1 | ||
2023 | $ 0 | ||
2022 | 2,919 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 2,919 | ||
Corporate senior loans | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 6 | ||
2023 | $ 16,248 | ||
2022 | 57,551 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | 73,799 | 57,165 | |
Less: Current expected credit losses | (1,197) | (797) | |
Total loans held-for-investment and related receivables, net | $ 72,602 | $ 56,368 | |
Corporate senior loans | 1 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 0 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 0 | ||
Corporate senior loans | 2 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 0 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 0 | ||
Corporate senior loans | 3 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 6 | ||
2023 | $ 16,248 | ||
2022 | 57,551 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 73,799 | ||
Corporate senior loans | 4 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 0 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 0 | ||
Corporate senior loans | 5 | |||
Financing Receivable, Credit Quality Indicator [Line Items] | |||
Number of Loans | loan | 0 | ||
2023 | $ 0 | ||
2022 | 0 | ||
2021 | 0 | ||
2020 | 0 | ||
2019 | 0 | ||
Loans held-for-investment and related receivables, net | $ 0 |
DERIVATIVE INSTRUMENTS AND HE_3
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Narrative (Details) $ in Thousands | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2023 USD ($) agreement | Mar. 31, 2022 USD ($) | Dec. 31, 2022 derivative | |
Derivatives, Fair Value [Line Items] | |||
Derivative, number of instruments matured (derivative) | derivative | 2 | ||
Derivative, number of instruments terminated (derivative) | derivative | 3 | ||
Amount of gain reclassified from other comprehensive loss into income as interest expense, net | $ | $ 0 | $ (7) | |
Interest rate swaps | |||
Derivatives, Fair Value [Line Items] | |||
Total unrealized gain (loss) on interest rate swap | $ | $ 0 | $ 1,600 | |
Interest Rate Caps | |||
Derivatives, Fair Value [Line Items] | |||
Derivative, number of instruments held (derivative) | agreement | 2 |
DERIVATIVE INSTRUMENTS AND HE_4
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Schedule of Derivative Instruments (Details) - Derivative assets, prepaid expenses and other assets - Interest Rate Caps - Cash Flow Hedging - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Derivative [Line Items] | ||
Outstanding notional amount | $ 712,000 | |
Fair value of assets | $ 3,080 | $ 5,040 |
Minimum | ||
Derivative [Line Items] | ||
Interest rates | 3.50% | |
Maximum | ||
Derivative [Line Items] | ||
Interest rates | 4% |
REPURCHASE FACILITIES, NOTES _3
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES - Narrative (Details) | 3 Months Ended | ||||||
Jul. 15, 2021 USD ($) entity | Jun. 04, 2020 USD ($) | Mar. 31, 2023 USD ($) property | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | Jul. 28, 2021 USD ($) | Jan. 31, 2021 USD ($) | |
Debt Instrument [Line Items] | |||||||
Repurchase facilities, notes payable and credit facilities, net | $ 3,961,213,000 | $ 4,422,833,000 | |||||
Weighted average years to maturity | 3 years 6 months | ||||||
Debt, weighted average interest rate | 5.90% | ||||||
Long-term debt | $ 3,979,408,000 | 4,443,911,000 | |||||
Loss on extinguishment of debt | (3,645,000) | $ (10,871,000) | |||||
Repayments of lines of credit | $ 519,069,000 | $ 857,815,000 | |||||
Number of properties used as collateral | property | 175 | ||||||
Reinvestment Period | |||||||
Debt Instrument [Line Items] | |||||||
Reinvestment period | 2 years | ||||||
Credit facilities | Affiliated Entity | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 2,700,000,000 | ||||||
Amount Financed | $ 2,223,748,000 | ||||||
Consolidated net worth, minimum | $ 1,000,000,000 | ||||||
Equity issued by the company, minimum | 75% | ||||||
Maximum leverage ratio to total indebtedness to total equity (less than or equal) | 80% | ||||||
Minimum interest coverage ratio of EBITDA to interest expense (greater than or equal) | 1.40 | ||||||
Credit facilities | Affiliated Entity | Term a | |||||||
Debt Instrument [Line Items] | |||||||
Minimum liquidity | $ 50,000,000 | ||||||
Credit facilities | Affiliated Entity | Term b | |||||||
Debt Instrument [Line Items] | |||||||
Minimum liquidity | $ 10,000,000 | ||||||
Recourse indebtedness | 5% | ||||||
Senior Loan | Affiliated Entity | |||||||
Debt Instrument [Line Items] | |||||||
Percent of lending guaranteed (up to) | 25% | ||||||
Variable Rate Debt | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 62,000,000 | ||||||
Short-term debt | $ 37,600,000 | ||||||
Citibank | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Debt, weighted average interest rate | 7% | ||||||
Line of credit facility, maximum borrowing capacity | 550,000,000 | ||||||
Amount Financed | $ 533,500,000 | ||||||
Citibank | Credit facilities | Affiliated Entity | |||||||
Debt Instrument [Line Items] | |||||||
Debt, weighted average interest rate | 6.50% | ||||||
Line of credit facility, maximum borrowing capacity | $ 400,000,000 | ||||||
Amount Financed | $ 336,035,000 | ||||||
J.P. Morgan | |||||||
Debt Instrument [Line Items] | |||||||
Reinvestment period | 3 years | ||||||
Minimum required assets under management | $ 1,250,000,000 | ||||||
J.P. Morgan | Credit facilities | Affiliated Entity | |||||||
Debt Instrument [Line Items] | |||||||
Debt, weighted average interest rate | 5.90% | ||||||
Amount Financed | $ 235,821,000 | ||||||
Mortgage Notes Payable | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 23,700,000 | $ 102,600,000 | |||||
Loss on extinguishment of debt | 205,000 | ||||||
Notes payable – fixed rate debt | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 0 | 36,538,000 | |||||
Repayments of lines of credit | $ 12,800,000 | ||||||
Variable Rate Debt | |||||||
Debt Instrument [Line Items] | |||||||
Debt, weighted average interest rate | 7.20% | ||||||
Long-term debt | $ 461,060,000 | 465,517,000 | |||||
Variable Rate Debt | Massachusetts Mutual Life Insurance Company | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 423,500,000 | ||||||
First lien mortgage loan | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | 0 | 121,940,000 | |||||
Initial Principal Balance | $ 650,000,000 | ||||||
Number of single purpose entities | entity | 114 | ||||||
Repayments of lines of credit | 121,900,000 | ||||||
First lien mortgage loan | Realty Income Purchase and Sale Agreement | |||||||
Debt Instrument [Line Items] | |||||||
Repayments of lines of credit | $ 105,800,000 | ||||||
ABS mortgage notes | |||||||
Debt Instrument [Line Items] | |||||||
Debt, weighted average interest rate | 2.80% | ||||||
Long-term debt | $ 761,100,000 | 763,035,000 | |||||
Initial Principal Balance | $ 774,000,000 | ||||||
Debt instrument, collateral amount | 963,800,000 | ||||||
Credit facilities | |||||||
Debt Instrument [Line Items] | |||||||
Long-term debt | $ 533,500,000 | $ 738,500,000 | |||||
Debt instrument, basis spread on variable rate | 2% | ||||||
Credit facilities | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | |||||||
Debt Instrument [Line Items] | |||||||
Debt instrument, basis spread on variable rate | 2.875% | ||||||
Credit facilities | Reinvestment Period | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 1.90% | 2% | |||||
Credit facilities | Reinvestment Period | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 2.75% | 2.85% | |||||
Credit facilities | Amortization Period | Minimum | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 2.10% | ||||||
Credit facilities | Amortization Period | Maximum | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 2.95% | ||||||
Credit facilities | CMFT Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | $ 300,000,000 | ||||||
Credit facilities | CMFT Credit Facility | Term Loan | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | 300,000,000 | ||||||
Credit facilities | CMFT Credit Facility | Revolving Loan | |||||||
Debt Instrument [Line Items] | |||||||
Line of credit facility, maximum borrowing capacity | 500,000,000 | ||||||
Credit facilities | CMFT Credit Facility | Revolving Credit Facility | |||||||
Debt Instrument [Line Items] | |||||||
Repayments of lines of credit | $ 240,000,000 | ||||||
Credit facilities | J.P. Morgan | |||||||
Debt Instrument [Line Items] | |||||||
Stated interest rate | 2% |
REPURCHASE FACILITIES, NOTES _4
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES - Schedule of Debt (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Short-Term and Long-Term Debt [Roll Forward] | ||
Total debt, Beginning Balance | $ 4,443,911 | |
Total debt, net, Beginning Balance | 4,422,833 | |
Debt issuances & assumptions | 53,275 | |
Total debt, net, Debt Issuances & Assumptions | 52,742 | |
Total debt, Repayments & Modifications | (517,778) | |
Total debt, net, Repayments & Modifications | (515,795) | |
Amortization | 1,433 | |
Total debt, Ending Balance | 3,979,408 | |
Total debt, net, Ending Balance | 3,961,213 | |
Loss on extinguishment of debt | (3,645) | $ (10,871) |
Prepayment penalties | 1,300 | |
Write-off of deferred financing costs | 2,354 | $ 7,068 |
Notes payable – fixed rate debt | ||
Short-Term and Long-Term Debt [Roll Forward] | ||
Total debt, Beginning Balance | 36,538 | |
Debt issuances & assumptions | 0 | |
Total debt, Repayments & Modifications | (36,538) | |
Total debt, Ending Balance | 0 | |
Variable Rate Debt | ||
Short-Term and Long-Term Debt [Roll Forward] | ||
Total debt, Beginning Balance | 465,517 | |
Deferred costs, Beginning Balance | (5,261) | |
Debt issuances & assumptions | 1,112 | |
Deferred costs, Debt Issuances & Assumptions | (40) | |
Total debt, Repayments & Modifications | (5,569) | |
Deferred costs, Repayments & Modifications | 602 | |
Deferred costs, Accretion and (Amortization) | 488 | |
Total debt, Ending Balance | 461,060 | |
Deferred costs, Ending Balance | (4,211) | |
First lien mortgage loan | ||
Short-Term and Long-Term Debt [Roll Forward] | ||
Total debt, Beginning Balance | 121,940 | |
Debt issuances & assumptions | 0 | |
Total debt, Repayments & Modifications | (121,940) | |
Total debt, Ending Balance | 0 | |
ABS mortgage notes | ||
Short-Term and Long-Term Debt [Roll Forward] | ||
Total debt, Beginning Balance | 763,035 | |
Deferred costs, Beginning Balance | (13,968) | |
Debt issuances & assumptions | 0 | |
Deferred costs, Debt Issuances & Assumptions | (493) | |
Total debt, Repayments & Modifications | (1,935) | |
Deferred costs, Repayments & Modifications | 0 | |
Deferred costs, Accretion and (Amortization) | 477 | |
Total debt, Ending Balance | 761,100 | |
Deferred costs, Ending Balance | (13,984) | |
Credit facilities | ||
Short-Term and Long-Term Debt [Roll Forward] | ||
Total debt, Beginning Balance | 738,500 | |
Deferred costs, Beginning Balance | (740) | |
Debt issuances & assumptions | 35,000 | |
Deferred costs, Debt Issuances & Assumptions | 0 | |
Total debt, Repayments & Modifications | (240,000) | |
Deferred costs, Repayments & Modifications | 679 | |
Deferred costs, Accretion and (Amortization) | 61 | |
Total debt, Ending Balance | 533,500 | |
Deferred costs, Ending Balance | 0 | |
Repurchase facilities | ||
Short-Term and Long-Term Debt [Roll Forward] | ||
Total debt, Beginning Balance | 2,318,381 | |
Debt issuances & assumptions | 17,163 | |
Total debt, Repayments & Modifications | (111,796) | |
Total debt, Ending Balance | 2,223,748 | |
Deferred costs – fixed rate debt and first lien mortgage loan | ||
Short-Term and Long-Term Debt [Roll Forward] | ||
Deferred costs, Beginning Balance | (1,109) | |
Deferred costs, Debt Issuances & Assumptions | 0 | |
Deferred costs, Repayments & Modifications | 702 | |
Deferred costs, Accretion and (Amortization) | 407 | |
Deferred costs, Ending Balance | 0 | |
Write-off of deferred financing costs | $ 2,000 |
REPURCHASE FACILITIES, NOTES _5
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES- Schedule of ABS Mortgage Notes (Details) - ABS mortgage notes | Jul. 28, 2021 USD ($) |
Line of Credit Facility [Line Items] | |
Initial Principal Balance | $ 774,000,000 |
A-1 (AAA) | |
Line of Credit Facility [Line Items] | |
Initial Principal Balance | $ 146,400,000 |
Note Rate | 2.09% |
A-2 (AAA) | |
Line of Credit Facility [Line Items] | |
Initial Principal Balance | $ 219,600,000 |
Note Rate | 2.57% |
A-3 (AA) | |
Line of Credit Facility [Line Items] | |
Initial Principal Balance | $ 39,200,000 |
Note Rate | 2.51% |
A-4 (AA) | |
Line of Credit Facility [Line Items] | |
Initial Principal Balance | $ 58,800,000 |
Note Rate | 3.04% |
A-5 (A) | |
Line of Credit Facility [Line Items] | |
Initial Principal Balance | $ 124,000,000 |
Note Rate | 2.91% |
A-6 (A) | |
Line of Credit Facility [Line Items] | |
Initial Principal Balance | $ 186,000,000 |
Note Rate | 3.44% |
REPURCHASE FACILITIES, NOTES _6
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES - Schedule of Repurchase Facilities (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) option | |
Line of Credit Facility [Line Items] | |
Weighted Average Interest Rate | 5.90% |
Maximum | One-Month LIBOR | |
Line of Credit Facility [Line Items] | |
Debt instrument, basis spread on variable rate | 2.85% |
Minimum | One-Month LIBOR | |
Line of Credit Facility [Line Items] | |
Debt instrument, basis spread on variable rate | 1.30% |
Deutsche Bank | |
Line of Credit Facility [Line Items] | |
Number of extension options | option | 4 |
Extension period | 1 year |
J.P. Morgan | Maximum | One-Month Term SOFR | |
Line of Credit Facility [Line Items] | |
Debt instrument, basis spread on variable rate | 1.35% |
J.P. Morgan | Minimum | One-Month Term SOFR | |
Line of Credit Facility [Line Items] | |
Debt instrument, basis spread on variable rate | 0.95% |
Citibank, Barclays And Wells Fargo | |
Line of Credit Facility [Line Items] | |
Number of extension options | option | 2 |
Extension period | 1 year |
Citibank, Barclays And Wells Fargo | Minimum | |
Line of Credit Facility [Line Items] | |
Number of extension options | option | 1 |
Credit facilities | Affiliated Entity | |
Line of Credit Facility [Line Items] | |
Maximum Facility Size | $ 2,700,000 |
Amount Financed | 2,223,748 |
Credit facilities | Affiliated Entity | Senior Loan | |
Line of Credit Facility [Line Items] | |
Loans Financed under Repurchase Facility (2) | 3,076,049 |
Credit facilities | Citibank | Affiliated Entity | |
Line of Credit Facility [Line Items] | |
Maximum Facility Size | $ 400,000 |
Weighted Average Interest Rate | 6.50% |
Amount Financed | $ 336,035 |
Credit facilities | Citibank | Affiliated Entity | Senior Loan | |
Line of Credit Facility [Line Items] | |
Loans Financed under Repurchase Facility (2) | 468,204 |
Credit facilities | Barclays | Affiliated Entity | |
Line of Credit Facility [Line Items] | |
Maximum Facility Size | $ 1,250,000 |
Weighted Average Interest Rate | 6.60% |
Amount Financed | $ 806,317 |
Credit facilities | Barclays | Affiliated Entity | Senior Loan | |
Line of Credit Facility [Line Items] | |
Loans Financed under Repurchase Facility (2) | 1,097,301 |
Credit facilities | Wells Fargo | Affiliated Entity | |
Line of Credit Facility [Line Items] | |
Maximum Facility Size | $ 750,000 |
Weighted Average Interest Rate | 6.40% |
Amount Financed | $ 696,712 |
Credit facilities | Wells Fargo | Affiliated Entity | Senior Loan | |
Line of Credit Facility [Line Items] | |
Loans Financed under Repurchase Facility (2) | 898,108 |
Credit facilities | Deutsche Bank | Affiliated Entity | |
Line of Credit Facility [Line Items] | |
Maximum Facility Size | $ 300,000 |
Weighted Average Interest Rate | 7.10% |
Amount Financed | $ 148,863 |
Credit facilities | Deutsche Bank | Affiliated Entity | Senior Loan | |
Line of Credit Facility [Line Items] | |
Loans Financed under Repurchase Facility (2) | $ 196,194 |
Credit facilities | J.P. Morgan | Affiliated Entity | |
Line of Credit Facility [Line Items] | |
Weighted Average Interest Rate | 5.90% |
Amount Financed | $ 235,821 |
Credit facilities | J.P. Morgan | Affiliated Entity | Senior Loan | |
Line of Credit Facility [Line Items] | |
Loans Financed under Repurchase Facility (2) | $ 416,242 |
REPURCHASE FACILITIES, NOTES _7
REPURCHASE FACILITIES, NOTES PAYABLE AND CREDIT FACILITIES - Schedule of Maturities of Long-term Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Principal Repayments | ||
Remainder of 2023 | $ 387,264 | |
2024 | 373,576 | |
2025 | 1,503,029 | |
2026 | 0 | |
2027 | 911,179 | |
Thereafter | 804,360 | |
Total | $ 3,979,408 | $ 4,443,911 |
COMMITMENTS AND CONTINGENCIES (
COMMITMENTS AND CONTINGENCIES (Details) - USD ($) $ in Millions | 1 Months Ended | |
May 11, 2023 | Mar. 31, 2023 | |
Subsequent event | Reserves For Settlement Of Loan Acquisitions | ||
Other Commitments [Line Items] | ||
Loans settled | $ 13 | |
Unfunded Loan Commitment | ||
Other Commitments [Line Items] | ||
Unfunded loan commitments | $ 292.7 | |
Unfunded Loan Commitment | N P J V Holdings | ||
Other Commitments [Line Items] | ||
Unfunded loan commitments | 112.6 | |
Unfunded or Unsettled Liquid Senior Loans | ||
Other Commitments [Line Items] | ||
Unfunded loan commitments | $ 18 |
RELATED-PARTY TRANSACTIONS AN_3
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS - Management and Investment Advisory Fees (Details) - USD ($) | Dec. 06, 2019 | Aug. 20, 2019 |
Related Party Transaction [Line Items] | ||
Investment advisory fee, percent per quarter | 0.375% | |
Advisors | ||
Related Party Transaction [Line Items] | ||
Management fee per annum | $ 250,000 | |
Management fee per quarter | $ 62,500 | |
Management fee percent per annum | 1.50% | |
Management fee percent per quarter | 0.375% | |
Investment advisory fee, percent per annum | 1.50% | |
Investment sub-advisory fees, percent per quarter | 50% |
RELATED-PARTY TRANSACTIONS AN_4
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS - Incentive Compensation (Details) - Advisors - USD ($) | 3 Months Ended | ||
Aug. 20, 2019 | Mar. 31, 2023 | Mar. 31, 2022 | |
Related Party Transaction [Line Items] | |||
Incentive compensation. in excess of product, quarterly percentage | 20% | ||
Incentive compensation. in excess of product, annualized percentage | 7% | ||
Incentive compensation fees | $ 0 | $ 0 |
RELATED-PARTY TRANSACTIONS AN_5
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS - Schedule of Related Party Transactions (Details) - Advisors - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Management fees | ||
Related Party Transaction [Line Items] | ||
Related party transaction, expenses from transactions with related party | $ 12,579 | $ 13,347 |
Expense reimbursements to related parties | ||
Related Party Transaction [Line Items] | ||
Related party transaction, expenses from transactions with related party | $ 3,568 | $ 3,694 |
RELATED-PARTY TRANSACTIONS AN_6
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS - Due to Affiliates (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Mar. 31, 2022 |
Related Party Transaction [Line Items] | |||
Due to affiliates | $ 13,816 | $ 16,086 | |
Advisors | Acquisition, Disposition and Operating Activities Fees and Expenses | |||
Related Party Transaction [Line Items] | |||
Due to affiliates | $ 13,800 | $ 16,100 |
RELATED-PARTY TRANSACTIONS AN_7
RELATED-PARTY TRANSACTIONS AND ARRANGEMENTS - Development Management Agreements and Affiliated Investments (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 12 Months Ended | |||||||
Apr. 30, 2022 USD ($) | Oct. 31, 2021 USD ($) | Jan. 07, 2021 building unit | May 11, 2023 USD ($) loan | Dec. 31, 2021 USD ($) | Mar. 31, 2023 USD ($) loan | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) loan | Nov. 30, 2021 USD ($) | Sep. 30, 2021 USD ($) | |
Related Party Transaction [Line Items] | ||||||||||
Loans held-for-investment and related receivables, net | $ 3,976,316 | $ 4,043,898 | ||||||||
Payments to acquire finance receivables | $ 119,000 | |||||||||
Payments to acquire equity method investments | 0 | $ 24,750 | ||||||||
Return of investment in unconsolidated entities | $ 2,450 | 0 | ||||||||
MT-FT JV | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Equity method investment, ownership percentage | 50% | |||||||||
Equity method investments | $ 212,500 | |||||||||
N P J V Holdings | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Equity method investment, ownership percentage | 50% | 50% | ||||||||
Equity method investments | $ 97,400 | |||||||||
Return of investment in unconsolidated entities | $ 39,900 | |||||||||
New Point JV, LLC | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Equity method investment, ownership percentage | 45% | |||||||||
Equity method investments | $ 97,400 | |||||||||
Payments to acquire equity method investments | 99,900 | |||||||||
Preferred units | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party investments | $ 68,400 | |||||||||
Mortgage Loan | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Related party investments | $ 203,600 | $ 138,800 | ||||||||
Development Management Agreements | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Termination period | 15 days | |||||||||
CIM NY Management, LLC | Development Management Agreements | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Management fee, percentage | 4% | |||||||||
Related party transaction, expenses from transactions with related party | $ 76 | $ 130 | ||||||||
Investment in Corporate Senior Loans | Subsequent event | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of loans | loan | 3 | |||||||||
Net investments in debt securities | $ 44,100 | |||||||||
First Mortgage Loans | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Loans held-for-investment and related receivables, net | $ 130,000 | 3,198,651 | 3,285,193 | |||||||
Payments to acquire finance receivables | $ 143,000 | |||||||||
Advances to affiliate | 123,000 | |||||||||
Equity method investments | $ 147,000 | |||||||||
First Mortgage Loans | Subsequent event | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of loans | loan | 6 | |||||||||
First Mortgage Loans | Third-Party, Number Two | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Advances to affiliate | 145,500 | |||||||||
First Mortgage Loans | Affiliated Entity | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Loans held-for-investment and related receivables, net | $ 155,000 | |||||||||
Payments to acquire finance receivables | $ 154,000 | |||||||||
First Mortgage Loans | Affiliated Entity | Third-Party, Number One | Maximum | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Advances to affiliate | 154,000 | |||||||||
Corporate senior loans | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Loans held-for-investment and related receivables, net | 73,799 | 57,165 | ||||||||
Corporate senior loans | Investment in Corporate Senior Loans | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Loans held-for-investment and related receivables, net | $ 75,900 | |||||||||
Advances to affiliate | $ 74,900 | |||||||||
Number of loans | loan | 2 | |||||||||
Number of loans, co-invested during period | loan | 5 | |||||||||
Net investments in debt securities | $ 15,500 | |||||||||
Corporate senior loans | Investment in Corporate Senior Loans | Subsequent event | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of loans | loan | 2 | |||||||||
Net investments in debt securities | $ 34,100 | |||||||||
Corporate senior loans | Investment in Corporate Senior Loans | CIM RACR | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Net investments in debt securities | 3,100 | |||||||||
Corporate senior loans | Investment in Corporate Senior Loans | CIM RACR | Subsequent event | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Net investments in debt securities | $ 6,000 | |||||||||
Corporate senior loans | Investment in Corporate Senior Loans | CIM RACR | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Loans held-for-investment and related receivables, net | $ 14,700 | |||||||||
Corporate senior loans | Upsized Investment in Corporate Senior Loan | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Net investments in debt securities | 1,700 | |||||||||
Corporate senior loans | Upsized Investment in Corporate Senior Loan | CIM RACR | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Net investments in debt securities | $ 348 | |||||||||
Condominium Units | Foreclosure Of Mezzanine Loans | Consolidated Properties | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of real estate properties secured through foreclosure | unit | 75 | |||||||||
Rental Unit | Foreclosure Of Mezzanine Loans | Consolidated Properties | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of real estate properties secured through foreclosure | unit | 21 | |||||||||
Buildings | Foreclosure Of Mezzanine Loans | Consolidated Properties | ||||||||||
Related Party Transaction [Line Items] | ||||||||||
Number of real estate properties secured through foreclosure | building | 4 |
STOCKHOLDERS_ EQUITY (Details)
STOCKHOLDERS’ EQUITY (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 | Mar. 31, 2022 | Aug. 10, 2018 | |
CCPT IV 2018 Equity Incentive Plan | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vested in period (shares) | 116,000 | ||
CCPT IV 2018 Equity Incentive Plan | Restricted stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares granted to each of the independent members of the Board (shares) | 116,000 | ||
Award requisite service period | 1 year | ||
Forfeited in period (shares) | 67,000 | ||
Unrecognized compensation expense | $ 240 | ||
CCPT IV 2018 Equity Incentive Plan | Restricted stock | General and administrative expenses | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Compensation expense | $ 120 | $ 37 | |
CCPT IV 2018 Equity Incentive Plan | Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for issuance (shares) | 400,000 | ||
Shares available for future grant (shares) | 183,000 | ||
CCPT IV 2022 Equity Incentive Plan | Restricted stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares granted to each of the independent members of the Board (shares) | 67,000 | ||
CCPT IV 2022 Equity Incentive Plan | Common Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Shares reserved for issuance (shares) | 250,000 |
LEASES - Narrative (Details)
LEASES - Narrative (Details) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 USD ($) lease | Mar. 31, 2022 | |
Leases [Abstract] | ||
Lessor, weighted average remaining lease term | 11 years 3 months 18 days | |
Number of operating leases | lease | 1 | |
Operating ground lease, remaining term | 10 years 4 months 24 days | |
Operating Lease, Liability, Statement of Financial Position [Extensible Enumeration] | Deferred rental income and other liabilities | Deferred rental income and other liabilities |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Derivative assets, prepaid expenses and other assets | Derivative assets, prepaid expenses and other assets |
Lease liability | $ 2,100 | |
Operating lease, discount rate | 4.30% | |
Ground lease, expense | $ 63 | |
Ground lease, payments | 61 | |
Future minimum rental payments, remainder of 2023 | 187 | |
Future minimum rental payments, 2024 | 250 | |
Future minimum rental payments, 2025 | 250 | |
Future minimum rental payments, 2026 | 250 | |
Future minimum rental payments, 2027 | 250 | |
Future minimum rental payments, 2028 | 250 | |
Future minimum rental payments, thereafter | $ 1,200 |
LEASES - Future Minimum Rental
LEASES - Future Minimum Rental Income (Details) $ in Thousands | Mar. 31, 2023 USD ($) |
Future Minimum Rental Income | |
Remainder of 2023 | $ 68,750 |
2024 | 90,135 |
2025 | 89,882 |
2026 | 87,107 |
2027 | 84,717 |
Thereafter | 645,156 |
Total | $ 1,065,747 |
LEASES - Schedule of Components
LEASES - Schedule of Components of Lease Income (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Mar. 31, 2022 | |
Leases [Abstract] | ||
Fixed rental and other property income | $ 37,357 | $ 64,706 |
Variable rental and other property income | 1,424 | 9,030 |
Total rental and other property income | $ 38,781 | $ 73,736 |
SEGMENT REPORTING (Details)
SEGMENT REPORTING (Details) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2023 USD ($) segment | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Segment Reporting Information [Line Items] | |||
Number of reportable segments | segment | 2 | ||
Revenues: | |||
Rental and other property income | $ 38,781 | $ 73,736 | |
Interest income | 108,083 | 31,463 | |
Total revenues | 146,864 | 105,199 | |
Expenses: | |||
General and administrative | 3,298 | 3,475 | |
Interest expense, net | 66,234 | 29,996 | |
Property operating | 2,576 | 7,727 | |
Real estate tax | 817 | 6,713 | |
Expense reimbursements to related parties | 3,568 | 3,694 | |
Management fees | 12,579 | 13,347 | |
Transaction-related | 13 | 7 | |
Depreciation and amortization | 15,110 | 19,141 | |
Real estate impairment | 4,814 | 3,291 | |
Increase in provision for credit losses | 1,453 | 4,709 | |
Total expenses | 110,462 | 92,100 | |
Other income (expense): | |||
Gain on disposition of real estate and condominium developments, net | 19,623 | 32,574 | |
Loss on investment in unconsolidated entities | (770) | 5,340 | |
Unrealized gain (loss) on equity security | 2,258 | (2,346) | |
Other income, net | 324 | 1,305 | |
Loss on extinguishment of debt | (3,645) | (10,871) | |
Net income | 54,192 | 39,101 | |
Net income allocated to noncontrolling interest | 8 | 9 | |
Segment net income (loss) attributable to the Company | 54,184 | 39,092 | |
Assets | 6,645,526 | 6,968,420 | $ 7,132,054 |
Operating Segments | Real Estate | |||
Revenues: | |||
Rental and other property income | 38,715 | 73,639 | |
Interest income | 0 | 0 | |
Total revenues | 38,715 | 73,639 | |
Expenses: | |||
General and administrative | 74 | 149 | |
Interest expense, net | 8,151 | 15,078 | |
Property operating | 1,684 | 7,136 | |
Real estate tax | 425 | 6,350 | |
Expense reimbursements to related parties | 0 | 0 | |
Management fees | 3,250 | 7,131 | |
Transaction-related | 13 | 7 | |
Depreciation and amortization | 15,110 | 19,141 | |
Real estate impairment | 4,814 | 3,291 | |
Increase in provision for credit losses | 0 | 0 | |
Total expenses | 33,521 | 58,283 | |
Other income (expense): | |||
Gain on disposition of real estate and condominium developments, net | 19,563 | 29,265 | |
Loss on investment in unconsolidated entities | 0 | 0 | |
Unrealized gain (loss) on equity security | 0 | 0 | |
Other income, net | (1,842) | 1,239 | |
Loss on extinguishment of debt | (1,172) | (10,737) | |
Net income | 21,743 | 35,123 | |
Net income allocated to noncontrolling interest | 8 | 9 | |
Segment net income (loss) attributable to the Company | 21,735 | 35,114 | |
Assets | 1,315,426 | 2,919,412 | |
Operating Segments | Credit | |||
Revenues: | |||
Rental and other property income | 0 | 0 | |
Interest income | 108,083 | 31,463 | |
Total revenues | 108,083 | 31,463 | |
Expenses: | |||
General and administrative | 372 | 230 | |
Interest expense, net | 54,016 | 11,612 | |
Property operating | 0 | 0 | |
Real estate tax | 0 | 0 | |
Expense reimbursements to related parties | 0 | 0 | |
Management fees | 9,329 | 6,216 | |
Transaction-related | 0 | 0 | |
Depreciation and amortization | 0 | 0 | |
Real estate impairment | 0 | 0 | |
Increase in provision for credit losses | 1,453 | 4,709 | |
Total expenses | 65,170 | 22,767 | |
Other income (expense): | |||
Gain on disposition of real estate and condominium developments, net | 0 | 0 | |
Loss on investment in unconsolidated entities | (770) | 168 | |
Unrealized gain (loss) on equity security | 2,258 | (2,368) | |
Other income, net | 1,843 | 66 | |
Loss on extinguishment of debt | 0 | 0 | |
Net income | 46,244 | 6,562 | |
Net income allocated to noncontrolling interest | 0 | 0 | |
Segment net income (loss) attributable to the Company | 46,244 | 6,562 | |
Assets | 4,725,168 | 3,767,306 | |
Corporate/Other | Corporate/Other | |||
Revenues: | |||
Rental and other property income | 66 | 97 | |
Interest income | 0 | 0 | |
Total revenues | 66 | 97 | |
Expenses: | |||
General and administrative | 2,852 | 3,096 | |
Interest expense, net | 4,067 | 3,306 | |
Property operating | 892 | 591 | |
Real estate tax | 392 | 363 | |
Expense reimbursements to related parties | 3,568 | 3,694 | |
Management fees | 0 | 0 | |
Transaction-related | 0 | 0 | |
Depreciation and amortization | 0 | 0 | |
Real estate impairment | 0 | 0 | |
Increase in provision for credit losses | 0 | 0 | |
Total expenses | 11,771 | 11,050 | |
Other income (expense): | |||
Gain on disposition of real estate and condominium developments, net | 60 | 3,309 | |
Loss on investment in unconsolidated entities | 0 | 5,172 | |
Unrealized gain (loss) on equity security | 0 | 22 | |
Other income, net | 323 | 0 | |
Loss on extinguishment of debt | (2,473) | (134) | |
Net income | (13,795) | (2,584) | |
Net income allocated to noncontrolling interest | 0 | 0 | |
Segment net income (loss) attributable to the Company | (13,795) | (2,584) | |
Assets | $ 604,932 | $ 281,702 |
SUBSEQUENT EVENTS (Details)
SUBSEQUENT EVENTS (Details) $ / shares in Units, $ in Thousands, shares in Millions | 1 Months Ended | 3 Months Ended | ||
May 11, 2023 USD ($) number_of_property loan $ / shares shares | Mar. 31, 2023 USD ($) property loan | Mar. 31, 2022 USD ($) | Dec. 31, 2022 USD ($) | |
Subsequent Event [Line Items] | ||||
Redemptions of common stock | $ 10,548 | $ 9,689 | ||
Number of real estate properties | property | 228 | |||
Gain on disposition of real estate, net | $ 19,623 | 32,574 | ||
Repurchase facilities, notes payable and credit facilities, net | 3,961,213 | $ 4,422,833 | ||
Repayments of lines of credit | 519,069 | $ 857,815 | ||
Corporate senior loans | Investment in Corporate Senior Loans | ||||
Subsequent Event [Line Items] | ||||
Net investments in debt securities | $ 15,500 | |||
Number of loans | loan | 2 | |||
CMBS | ||||
Subsequent Event [Line Items] | ||||
Net investments in debt securities | $ 9,400 | |||
Subsequent event | ||||
Subsequent Event [Line Items] | ||||
Redemption of common stock (in shares) | shares | 1.6 | |||
Redemptions of common stock | $ 10,800 | |||
Common stock, redemption price per share (USD per share) | $ / shares | $ 6.57 | |||
Unfulfilled redemption requests (shares) | shares | 23.9 | |||
Number of real estate properties | number_of_property | 27 | |||
Aggregate gross sales price | $ 82,100 | |||
Gain on disposition of real estate, net | 12,800 | |||
Subsequent event | Investment in Corporate Senior Loans | ||||
Subsequent Event [Line Items] | ||||
Net investments in debt securities | $ 44,100 | |||
Number of loans | loan | 3 | |||
Subsequent event | Discontinued Operations, Disposed of by Sale | ||||
Subsequent Event [Line Items] | ||||
Aggregate gross sales price | $ 25,400 | |||
Gain on disposition of real estate, net | $ 7,600 | |||
Number of properties disposed | loan | 2 | |||
Proceeds from sale of assets | $ 23,900 | |||
Subsequent event | Credit facilities | ||||
Subsequent Event [Line Items] | ||||
Repayments of lines of credit | 88,000 | |||
Subsequent event | Credit facilities | Deutsche Bank | ||||
Subsequent Event [Line Items] | ||||
Repayments of lines of credit | 5,000 | |||
Subsequent event | Liquid corporate senior loans | ||||
Subsequent Event [Line Items] | ||||
Debt settled | 13,000 | |||
Loans sold | 5,800 | |||
Subsequent event | Corporate senior loans | Investment in Corporate Senior Loans | ||||
Subsequent Event [Line Items] | ||||
Net investments in debt securities | $ 34,100 | |||
Number of loans | loan | 2 | |||
Subsequent event | First Mortgage Loans | ||||
Subsequent Event [Line Items] | ||||
Number of loans | loan | 6 | |||
Funded aggregate amount | $ 4,900 | |||
Subsequent event | CMBS | ||||
Subsequent Event [Line Items] | ||||
Net investments in debt securities | 63,500 | |||
Subsequent event | CMBS | J.P. Morgan | ||||
Subsequent Event [Line Items] | ||||
Repurchase facilities, notes payable and credit facilities, net | 36,200 | |||
Repayments of mortgage loans | $ 551 |