ALLOWANCE FOR CREDIT LOSSES (Tables)

6 Months Ended

Jun. 30, 2025

A rollforward of our allowance for credit losses for the six months ended June 30, 2025 is as follows:


Rating	Financial Statement Line Item	Allowance for Credit Loss as of December 31, 2024		Provision (Recovery) for Credit Loss for the six months ended June 30, 2025⁽¹⁾			Write-offs charged against allowance for the six months ended June 30, 2025			Other reductions to the allowance for the six months ended June 30, 2025			Allowance for Credit Loss as of June 30, 2025
		(in thousands)
1	Real estate loan receivable	$	312	$	(47)		$	—		$	—		$	265
2	Real estate loans receivable		492		(155)			—			—			337
3	Real estate loans receivable		10,991		(57)			—			—			10,934
4	Real estate loans receivable		22,528		(2,695)			—			—			19,833
5	Real estate loans receivable		25,476		4,408			—			—			29,884
6	Real estate loans receivable		11,450		(426)			—			—			11,024
	Sub-total		71,249		1,028	⁽²⁾		—			—			72,277

5	Investment in direct financing leases		1,605		—			—			(1,605)	⁽³⁾		—
	Sub-total		1,605		—			—			(1,605)			—

2	Non-real estate loans receivable		37		6			—			—			43
3	Non-real estate loans receivable		1,868		(412)			—			—			1,456
4	Non-real estate loans receivable		2,268		(1,001)			—			—			1,267
5	Non-real estate loans receivable		43,287		(701)			—			—			42,586
6	Non-real estate loans receivable		75,335		4,285			(17,851)	⁽⁴⁾		—			61,769
	Sub-total		122,795		2,177	⁽²⁾		(17,851)			—			107,121

2	Unfunded real estate loan commitments		1		1			—			—			2
3	Unfunded real estate loan commitments		461		18			—			—			479
4	Unfunded real estate loan commitments		40		140			—			—			180
5	Unfunded real estate loan commitments		1,767		(924)			—			—			843
2	Unfunded non-real estate loan commitments		13		(7)			—			—			6
3	Unfunded non-real estate loan commitments		183		(77)			—			—			106
4	Unfunded non-real estate loan commitments		433		(18)			—			—			415
6	Unfunded non-real estate loan commitments		65		(65)			—			—			—
	Sub-total		2,963		(932)			—			—			2,031

	Total	$	198,612	$	2,273		$	(17,851)		$	(1,605)		$	181,429

(1)

During the six months ended June 30, 2025, we received proceeds of $1.7 million from the liquidating trust related to the $25.0 million DIP facility to Gulf Coast Health Care LLC (“Gulf Coast”) and proceeds of $0.3 million related to one other real estate loan, which resulted in a recovery for credit losses of $2.0 million. Both of these loans and related reserves were previously written off, so the $2.0 million aggregate recovery is not included in the rollforward above.

(2)

These amounts include cash recoveries of $2.9 million related to interest payments received on loans that are written down to fair value and are being accounted for under the cost recovery method in which any payments received are applied directly against the principal balance outstanding. This amount also includes $1.8 million related to principal payments received on loans that were fully reserved.

(3)	Represents the allowance for credit losses related to an investment in a direct financing lease that was reclassified to real estate assets in connection with the termination of the lease in the first half of 2025 as discussed further in Note 2 – Real Estate Assets.

(4)	Amount reflects the write-off of the reserves associated with the $10.0 million DIP financing and the $8.3 million term loan to LaVie (which were both previously fully reserved) that were discharged as part of the LaVie plan of reorganization that was made effective on June 1, 2025.

A rollforward of our allowance for credit losses for the six months ended June 30, 2024 is as follows:


Rating	Financial Statement Line Item	Allowance for Credit Loss at December 31, 2023		Provision (Recovery) for Credit Loss for the six months ended June 30, 2024⁽¹⁾			Write-offs charged against allowance for the six months ended June 30, 2024		Allowance for Credit Loss as of June 30, 2024
		(in thousands)
1	Real estate loans receivable	$	1,501	$	(574)		$	—	$	927
2	Real estate loans receivable		291		460			—		751
3	Real estate loans receivable		12,635		310			—		12,945
4	Real estate loans receivable		65,113		(37,237)	⁽²⁾		—		27,876
5	Real estate loans receivable		—		28,032	⁽²⁾		—		28,032
6	Real estate loans receivable		11,450		—			—		11,450
	Sub-total		90,990		(9,009)			—		81,981

5	Investment in direct financing leases		2,489		(790)			—		1,699
	Sub-total		2,489		(790)			—		1,699

2	Non-real estate loans receivable		1,151		(158)			—		993
3	Non-real estate loans receivable		3,903		(792)			—		3,111
4	Non-real estate loans receivable		720		(290)			—		430
5	Non-real estate loans receivable		43,404		5,016			—		48,420
6	Non-real estate loans receivable		72,453		6,698			(7,632)		71,519
	Sub-total		121,631		10,474	⁽³⁾		(7,632)		124,473

2	Unfunded real estate loan commitments		10		(9)			—		1
3	Unfunded real estate loan commitments		335		62			—		397
4	Unfunded real estate loan commitments		4,314		(4,263)	⁽²⁾		—		51
5	Unfunded real estate loan commitments		—		3,063	⁽²⁾		—		3,063
2	Unfunded non-real estate loan commitments		692		(446)			—		246
3	Unfunded non-real estate loan commitments		46		176			—		222
4	Unfunded non-real estate loan commitments		63		(36)			—		27
5	Unfunded non-real estate loan commitments		1,594		(1,594)			—		—
6	Unfunded non-real estate loan commitments		—		92			—		92
			7,054		(2,955)			—		4,099

	Total	$	222,164	$	(2,280)		$	(7,632)	$	212,252

(1)

During the six months ended June 30, 2024, we received proceeds of $3.3 million from the liquidating trust related to the $25.0 million DIP facility to Gulf Coast, which resulted in a recovery for credit losses of $3.3 million that is not included in the rollforward above since we had previously written-off the loan balance and related reserve.

(2)	Amount reflects the movement of reserves associated with the Maplewood Revolver due to an adjustment to the internal risk rating on the loan from 4 to 5 during the first quarter of 2024. See Note 5 – Real Estate Loans Receivable for additional information.

(3)

The amount includes cash recoveries of $2.4 million related to interest payments received on loans that are written down to fair value and are being accounted for under the cost recovery method in which any payments received are applied directly against the principal balance outstanding. This amount also includes $0.2 million related to principal payments received on loans that were fully reserved.

Schedule by segment balance by vintage and credit quality indicator

A summary of our amortized cost basis by year of origination and credit quality indicator is as follows:


Rating	Financial Statement Line Item	2025		2024		2023		2022		2021		2020		2019 & older		Revolving Loans		Balance as of June 30, 2025
		(in thousands)
1	Real estate loans receivable	$	—	$	—	$	—	$	20,000	$	—	$	—	$	—	$	—	$	20,000
2	Real estate loans receivable		—		29,700		8,680		—		—		21,325		—		—		59,705
3	Real estate loans receivable		26,867		255,614		159,630		25,600		72,420		—		—		—		540,131
4	Real estate loans receivable		18,775		79,971		82,673		—		31,747		72,413		307,606		—		593,185
5	Real estate loans receivable		—		—		—		—		—		—		—		263,580		263,580
6	Real estate loans receivable		—		—		—		—		—		—		12,496		—		12,496
	Sub-total		45,642		365,285		250,983		45,600		104,167		93,738		320,102		263,580		1,489,097

2	Non-real estate loans receivable		—		—		—		—		—		—		—		16,439		16,439
3	Non-real estate loans receivable		2,124		3,882		77,003		15,738		—		—		2,683		50,439		151,869
4	Non-real estate loans receivable		3,152		4,411		—		—		—		—		121,766		30,690		160,019
5	Non-real estate loans receivable		500		6,000		—		—		—		—		42,810		—		49,310
6	Non-real estate loans receivable		—		6,386		5,158		24,458		—		—		26,822		—		62,824
	Sub-total		5,776		20,679		82,161		40,196		—		—		194,081		97,568		440,461

	Total	$	51,418	$	385,964	$	333,144	$	85,796	$	104,167	$	93,738	$	514,183	$	361,148	$	1,929,558

	Year to date gross write-offs	$	—	$	—	$	—	$	—	$	(7,851)	$	—	$	—	$	(10,000)	$	(17,851)

OMEGA HEALTHCARE INVESTORS INC 10-Q