Investments
 6 Months Ended
Jun. 30, 2018
Investments in and Advances to Affiliates, Schedule of Investments [Abstract]  
Investments
Investments
Real Estate Investments

As of June 30, 2018, the Company's gross investment in real estate properties and loans totaled approximately $4.9 billion, representing investments in 1,512 properties, including 54 properties securing mortgage loans. The gross 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 Texas, at 12.2%, as the only state with a real estate investment value greater than 10% of the real estate investment value of the Company's entire portfolio.

During the six months ended June 30, 2018, the Company had the following real estate and loan activity, net of accumulated depreciation and amortization:
 
Number of Properties
 
Dollar Amount of Investments
 
Owned
 
Financed
 
Total
 
Owned
 
Financed
 
Total
 
 
 
 
 
 
 
(In Thousands)
Gross balance, December 31, 2017
2,392

 
88

 
2,480

 
$
7,823,058

 
$
79,967

 
$
7,903,025

Acquisitions/improvements (1)
5

 
2

 
7

 
39,277

 
37,888

 
77,165

Dispositions of real estate (2)(3)(4)
(40
)
 
(6
)
 
(46
)
 
(79,862
)
 
—

 
(79,862
)
Principal payments and payoffs
—

 
(28
)
 
(28
)
 
—

 
(23,299
)
 
(23,299
)
Impairments
—

 
—

 
—

 
(15,918
)
 
—

 
(15,918
)
Write-off of gross lease intangibles
—

 
—

 
—

 
(47,003
)
 
—

 
(47,003
)
Loan premium amortization and other
—

 
—

 
—

 
(867
)
 
(1,230
)
 
(2,097
)
Spin-off to SMTA
(899
)
 
(2
)
 
(901
)
 
(2,855,052
)
 
(37,888
)
 
(2,892,940
)
Gross balance, June 30, 2018
1,458

 
54

 
1,512

 
4,863,633

 
55,438

 
4,919,071

Accumulated depreciation and amortization
 
 
 
 
 
 
(661,537
)
 
—

 
(661,537
)
Other
 
 
 
 
 
 
(1
)
 
—

 
(1
)
Net balance, June 30, 2018
 
 
 
 
 
 
$
4,202,095

 
$
55,438

 
$
4,257,533


(1) Includes investments of $17.9 million in revenue producing capitalized expenditures, as well as $3.4 million of non-revenue producing capitalized expenditures as of June 30, 2018.
(2) The total accumulated depreciation and amortization associated with dispositions of real estate was $14.3 million as of June 30, 2018.
(3) For the six months ended June 30, 2018, the total (loss) gain on disposal of assets for properties held in use and held for sale was $(2.5) million and $2.7 million, respectively.
(4) Includes six deed-in-lieu properties with a real estate investment of $28.5 million that were transferred to the lender during the six months ended June 30, 2018.
Scheduled minimum future contractual rent to be received under the remaining non-cancelable term of the operating leases (including contractual fixed rent increases occurring on or after July 1, 2018) at June 30, 2018 (in thousands):
 
June 30,
2018
Remainder of 2018
$
182,714

2019
362,458

2020
355,473

2021
334,983

2022
311,806

Thereafter
2,222,648

Total future minimum rentals
$
3,770,082


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 rent based on a percentage of the lessees' gross sales or lease escalations based on future changes in the CPI or other stipulated reference rate.
Loans Receivable
The following table details loans receivable, net of premiums and allowance for loan losses (in thousands):
 
June 30,
2018
 
December 31,
2017
Mortgage loans - principal
$
46,830

 
$
69,963

Mortgage loans - premiums, net of amortization
3,390

 
5,038

Allowance for loan losses
—

 
(389
)
Mortgages loans, net
50,220

 
74,612

Other notes receivable - principal
5,218

 
5,355

Allowance for loan losses
—

 
—

Other notes receivable, net
5,218

 
5,355

Total loans receivable, net
$
55,438

 
$
79,967


The mortgage loans are secured by single-tenant commercial properties and generally have fixed interest rates over the term of the loans. There are three other notes receivable included within loans receivable, of which two notes totaling $3.5 million are secured by tenant assets and stock and the remaining note, with a balance of $1.7 million, is unsecured.

On January 16, 2018, the Operating Partnership funded a $35.0 million B-1 Term Loan as part of a syndicated loan and security agreement with Shopko as borrower and several banks as lenders. The B-1 Term Loan bears interest at a rate of 12.00% per annum and matures on June 19, 2020. Principal will be repaid in quarterly installments of $0.6 million commencing on November 1, 2018, while interest will be paid monthly. The loan is secured by Shopko’s assets in its $784 million asset-backed lending facility and is subordinate to other loans made under the syndicated loan and security agreement. The Operating Partnership received a commitment fee equal to 3.00% of the B-1 Term Loan. The B-1 Term Loan was contributed to SMTA in conjunction with the Spin-Off.
Lease Intangibles, Net
The following table details lease intangible assets and liabilities, net of accumulated amortization (in thousands):
 
June 30,
2018
 
December 31,
2017
In-place leases
$
368,450

 
$
591,551

Above-market leases
59,478

 
89,640

Less: accumulated amortization
(140,321
)
 
(271,288
)
Intangible lease assets, net
$
287,607

 
$
409,903

 
 
 
 
Below-market leases
$
169,149

 
$
216,642

Less: accumulated amortization
(43,244
)
 
(61,339
)
Intangible lease liabilities, net
$
125,905

 
$
155,303


The amounts amortized as a net increase to rental revenue for capitalized above and below-market leases were $1.4 million and $1.6 million for the three months ended June 30, 2018 and 2017, respectively, and $2.9 million and $3.4 million for the six months ended June 30, 2018 and 2017, respectively. The value of in place leases amortized and included in depreciation and amortization expense was $8.7 million and $10.9 million for the three months ended June 30, 2018 and 2017, respectively, and $18.7 million and $22.1 million for the six months ended June 30, 2018 and 2017, 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,
2018
 
December 31,
2017
Minimum lease payments receivable
$
6,358

 
$
7,325

Estimated residual value of leased assets
24,552

 
24,552

Unearned income
(6,082
)
 
(7,012
)
Real estate assets under direct financing leases, net
$
24,828

 
$
24,865


Real Estate Assets Held for Sale
The following table shows the activity in real estate assets held for sale for the six months ended June 30, 2018 (dollars in thousands):
 
Number of Properties
 
Carrying
Value
Balance, December 31, 2017
15

 
$
48,929

Transfers from real estate investments held and used
6

 
14,090

Sales
(6
)
 
(10,257
)
Transfers to real estate investments held in use
(7
)
 
(25,715
)
Transfers to SMTA
(5
)
 
(7,853
)
Impairments
—

 
(369
)
Balance, June 30, 2018
3

 
$
18,825


Impairments

The following table summarizes total impairment losses recognized on the accompanying consolidated statements of operations and comprehensive income (in thousands):
 
Three Months Ended June 30,
 
Six Months Ended 
 June 30,
 
2018
 
2017
 
2018
 
2017
Real estate and intangible asset impairment
$
662

 
$
14,657

 
$
15,624

 
$
49,877

Write-off of lease intangibles, net
687

 
1,339

 
311

 
495

Recovery of loans receivable, previously impaired
—

 
—

 
(17
)
 
—

Total impairment loss
$
1,349

 
$
15,996

 
$
15,918

 
$
50,372



Impairments for the three months ended June 30, 2018 and 2017, were comprised of $1.3 million and $13.1 million on properties classified as held and used, respectively, and $2.9 million on properties classified as held for sale for the three months ended June 30, 2017.
Impairments for the six months ended June 30, 2018 and 2017, were comprised of $15.5 million and $36.0 million on properties classified as held and used, respectively, and $0.4 million and $14.4 million on properties classified as held for sale, respectively.