Investments
 6 Months Ended
Jun. 30, 2015
Investments in and Advances to Affiliates, Schedule of Investments [Abstract]  
Investments
Investments
Real Estate Investments

As of June 30, 2015, the Company's investment in real estate and loans totaled approximately $8.21 billion, representing investments in 2,600 properties, including 145 properties securing mortgage loans. The investment is comprised of land, buildings, lease intangible assets and lease intangible liabilities, as adjusted for any impairment, and the carrying amount of loans receivable, real estate assets held under direct financing leases and real estate assets held for sale. The portfolio is geographically dispersed throughout 49 states with only one state, Texas, with a real estate investment of 12.0%, accounting for more than 10.0% of the total dollar amount of the Company’s real estate investment portfolio.

The properties that the Company owns are leased to tenants under long-term operating leases that typically include one or more renewal options. The leases are generally triple-net, which provides that the lessee is responsible for the payment of all property operating expenses, including property taxes, maintenance and repairs, and insurance costs. Therefore, the Company is generally not responsible for repairs or other capital expenditures related to its properties, unless the property is not subject to a triple net lease agreement.

During the six months ended June 30, 2015, the Company had the following real estate and loan activity, net of accumulated depreciation and amortization:
 
Number of Properties
 
Dollar Amount of Investments, net
 
Owned (4)
 
Financed
 
Total
 
Owned
 
Financed
 
Total
 
 
 
 
 
 
 
(In Thousands)
Gross balance, December 31, 2014
2,364

 
145

 
2,509

 
$
7,934,938

 
$
109,425

 
$
8,044,363

Acquisitions/improvements (1) (3)
148

 
—

 
148

 
550,662

 
4,000

 
554,662

Dispositions of real estate (2) (3)
(57
)
 
—

 
(57
)
 
(349,362
)
 
—

 
(349,362
)
Principal payments and payoffs
—

 
—

 
—

 
—

 
(2,811
)
 
(2,811
)
Impairments
—

 
—

 
—

 
(35,328
)
 
—

 
(35,328
)
Write off of gross lease intangibles
—

 
—

 
—

 
(2,382
)
 
—

 
(2,382
)
Loan premium amortization and other
—

 
—

 
—

 
(113
)
 
(1,237
)
 
(1,350
)
Gross balance, June 30, 2015
2,455

 
145

 
2,600

 
$
8,098,415

 
$
109,377

 
$
8,207,792

Accumulated depreciation and amortization
 
 
 
 
 
 
(983,229
)
 
—

 
(983,229
)
Other non-real estate assets held for sale
 
 
 
 
 
 
1,316

 
—

 
1,316

Net balance, June 30, 2015
 
 
 
 
 
 
$
7,116,502

 
$
109,377

 
$
7,225,879


(1) Includes investments of $2.6 million in revenue producing capitalized expenditures, as well as $0.6 million of non-revenue producing capitalized maintenance expenditures. Capitalized maintenance expenditures are not included in the Company's investment in real estate disclosed elsewhere.
(2) The total accumulated depreciation and amortization associated with these dispositions of real estate was $73.7 million.
(3) During the six months ended June 30, 2015, pursuant to 1031 Exchanges, the Company sold 23 properties for $212.1 million and used $172.1 million of this amount to partially fund 62 property acquisitions.
(4) At June 30, 2015 and December 31, 2014, 33 and 37, respectively, of the Company's properties were vacant and in the Company’s possession; of these amounts, 11 and 8, respectively, were held for sale.
Scheduled minimum future contractual rent to be received under the remaining non-cancelable term of the operating leases at June 30, 2015 (in thousands):
Remainder of 2015
$
308,950

2016
608,206

2017
594,922

2018
580,686

2019
561,657

Thereafter
4,526,522

Total future minimum rentals
$
7,180,943


Because lease renewal periods are exercisable at the option of the lessee, the preceding table presents future minimum lease payments due during the initial lease term only. In addition, the future minimum rentals do not include any contingent rentals based on a percentage of the lessees' gross sales or lease escalations based on future changes in the CPI or other stipulated reference rate.
Certain of the Company’s leases contain tenant purchase options. Most of these options are at or above fair market value at the time the option is exercisable, and none of these purchase options represent bargain purchase options.
Loans Receivable
The following table details loans receivable, net of premium (in thousands):
 
June 30,
2015
 
December 31,
2014
Mortgage - principal
$
93,810

 
$
96,594

Mortgage - premium
11,215

 
12,452

Mortgages, net
105,025

 
109,046

Other notes - principal
4,352

 
379

Total loans receivable, net
$
109,377

 
$
109,425


The mortgage loans are secured by single-tenant commercial properties and generally have fixed interest rates over the term of the loans. There are two other notes receivable, one $4.0 million note is secured by tenant assets and stock and the other is unsecured.
Allowance for Loan Losses
At June 30, 2015 and December 31, 2014, there was no allowance for loan losses, and there were no mortgages or notes on nonaccrual status.
Lease Intangibles, Net
The following table details lease intangible assets and liabilities, net of accumulated amortization (in thousands):
 
June 30,
2015
 
December 31,
2014
In-place leases
$
661,206

 
$
676,665

Above-market leases
99,760

 
100,568

Less: accumulated amortization
(203,752
)
 
(187,160
)
Intangible lease assets, net
$
557,214

 
$
590,073

 
 
 
 
Below-market leases
$
240,437

 
$
237,593

Less: accumulated amortization
(38,416
)
 
(31,625
)
Intangible lease liabilities, net
$
202,021

 
$
205,968


The amounts amortized as a net increase to rental revenue for capitalized above- and below-market leases were $2.8 million and $3.0 million for the six months ended June 30, 2015 and 2014, respectively, and $1.4 million and $1.7 million for the three months ended June 30, 2015 and 2014, respectively. The value of in-place leases amortized and included in depreciation and amortization expense was $25.4 million and $26.9 million for the six months ended June 30, 2015 and 2014, respectively, and $12.6 million and $13.5 million for the three months ended June 30, 2015 and 2014, respectively.
Real Estate Assets Under Direct Financing Leases
The components of real estate investments held under direct financing leases were as follows (in thousands):
 
June 30,
2015
 
December 31,
2014
Minimum lease payments receivable
$
14,210

 
$
15,897

Estimated residual value of leased assets
43,789

 
55,858

Unearned income
(13,617
)
 
(15,191
)
Real estate assets under direct financing leases, net
$
44,382

 
$
56,564


Real Estate Assets Held for Sale
The following table shows the activity in real estate assets held for sale, for continuing and discontinued operations, for the six months ended June 30, 2015:
 
Number of Properties
 
Carrying Value
 
Continuing Operations
 
Discontinued Operations
 
Total
 
Continuing Operations
 
Discontinued Operations
 
Total
 
 
 
 
 
 
 
(In Thousands)
Balance, December 31, 2014
19

 
5

 
24

 
$
110,918

 
$
8,994

 
$
119,912

Transfers from real estate investments
33

 
—

 
33

 
140,060

 
(34
)
 
140,026

Sales
(28
)
 
(2
)
 
(30
)
 
(147,124
)
 
(4,475
)
 
(151,599
)
Balance, June 30, 2015
24

 
3

 
27

 
$
103,854

 
$
4,485

 
$
108,339



Properties included in discontinued operations as of June 30, 2015 are collateral assets under the 2014 Master Trust securitization. The following table is a reconciliation of the major classes of assets and liabilities from discontinued operations included in real estate assets held for sale on the accompanying consolidated balance sheets (in thousands):
 
June 30,
2015
 
December 31,
2014
Assets
 
 
 
Land and improvements
$
2,922

 
$
5,351

Buildings and improvements
2,916

 
5,798

Total real estate investments
5,838

 
11,149

Less: accumulated depreciation
(1,202
)
 
(2,167
)
Intangible lease assets, net
297

 
460

Total assets
$
4,933

 
$
9,442

 
 
 
 
Liabilities
 
 
 
Intangible lease liabilities, net
$
448

 
$
448

Total liabilities
$
448

 
$
448

 
 
 
 
Net assets
$
4,485

 
$
8,994


Impairments
The following table summarizes total impairment losses recognized in continuing and discontinued operations on the accompanying consolidated statements of operations (in thousands): 
 
Three Months Ended 
 June 30,
 
Six Months Ended 
 June 30,
 
2015
 
2014
 
2015
 
2014
Real estate and intangible asset impairment
$
33,730

 
$
24,610

 
$
34,773

 
$
26,247

Write-off of lease intangibles due to lease terminations, net
43

 
2,529

 
555

 
2,599

Total impairments from real estate investment net assets
33,773

 
27,139

 
35,328

 
28,846

Other impairment
(7
)
 
488

 
96

 
488

Total impairment loss in continuing and discontinued operations
$
33,766

 
$
27,627

 
$
35,424

 
$
29,334