Other Assets, net

9 Months Ended

Sep. 30, 2025

Deferred Costs, Capitalized, Prepaid, and Other Assets Disclosure [Abstract]

OTHER ASSETS, NET

Other assets, net on the Company's Condensed Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024 are detailed in the table below.


	Balance as of
(Dollars in thousands)	September 30, 2025		December 31, 2024
Straight-line rent receivables, net	$	23,162	$	20,426
Sales-type lessor receivables	7,950		3,012
Fair value of interest rate swaps	7,580		17,631
Leasing commissions, net	4,712		4,104
Deferred financing costs, net	3,142		3,725
Financing lease right-of-use assets	2,383		2,427
Prepaid assets	2,179		1,666
Mortgage note receivable	2,000		2,000
Notes receivable, net of credit loss reserve	1,960		15,727
Accounts and interest receivables, net	1,572		4,138
Above-market intangible assets, net	1,483		1,932
Operating lease right of use assets	675		698
Other	1,205		616

	$	60,003	$	78,102

The Company's notes and mortgage note receivable included the following at September 30, 2025 and December 31, 2024:

•In June 2025, a note receivable, secured by all assets and ownership interests in seven long-term acute care hospitals and one inpatient rehabilitation hospital owned by the borrower, was prepaid in full, along with interest through its maturity date of December 31, 2025. The balance on the note at December 31, 2024 was $3.0 million.

•At September 30, 2025 and December 31, 2024, notes receivable included a fully-drawn term loan totaling $17.0 million and a revolving credit facility with $2.7 million and $4.5 million drawn, respectively, secured by assets and ownership interests of six geriatric behavioral hospitals and affiliated companies all of which are co-borrowers on the loans. At September 30, 2025, the Company had an unfunded commitment of $5.8 million on the revolving credit facility. Any future requests for borrowings under the revolving credit facility from this tenant will require review and approval by management. The revolving credit facility, as amended, bears interest at 9% per annum and matures on December 31, 2025. The term loan, as amended, bears interest at 9% per annum, with interest only payments due currently, quarterly installments of principal payments of $250,000 beginning March 31, 2026 through December 31, 2026, and quarterly installments of principal payments of $666,666 beginning on March 31, 2027 through the facility maturity on December 31, 2032. The term loan and revolving credit facility include a 3% per annum non-cash interest charge that is payable upon the earlier of the repayment or maturity of each note.

In the second quarter of 2024, the Company determined that the collectability of the term loan and revolver loan was not reasonably assured. The Company prepared a valuation of the notes based on the estimated fair value of the underlying collateral, requiring management to determine certain assumptions used for the estimation of fair value, including the determination of adjusted EBITDA and the selected EBITDA multiple range. As a result, in the second quarter of 2024, the Company recorded an $11.0 million credit loss reserve on these notes receivable and has placed the notes on non-accrual status.

During the second quarter of 2025, the tenant received indications of interest from various buyers for the sale of its business. Based on the offers received, the Company determined that the collectability of the remaining outstanding note and interest receivable balances related to this tenant were not reasonably assured. As such, during the three months ended June 30, 2025, the Company recognized an additional credit loss reserve for the remaining balances of the notes, totaling approximately $8.7 million and reserved the remaining outstanding interest receivable on these notes totaling approximately $1.7 million.

•At September 30, 2025 and December 31, 2024, notes receivable, as amended, also included a $2.0 million revolving credit facility with a borrower. The revolving credit facility will be repaid in monthly installments of $20,000 from March 1, 2025 through May 31, 2025, $40,000 from June 1, 2025 through November 30, 2025, and $50,000 from December 1, 2025 through the maturity date of April 1, 2027 with a balloon payment due at maturity. The revolving credit facility bears interest at 9% per annum, as well as a 3% per annum non-cash interest charge that is due and payable upon the earlier of the repayment or maturity of the note.

•At September 30, 2025 and December 31, 2024, the Company had a $2.0 million mortgage note receivable with a developer which is secured by the land, improvements, and personal property. The mortgage loan, which bears interest at 10% per annum, will be interest only until the principal is due at the earlier of the sale of the property, or August 15, 2027.

The Company identified the borrowers of these notes as variable interest entities ("VIEs"), but management determined that the Company was not the primary beneficiary of the VIEs because we lack either directly or through related parties any material decision-making rights or control of the entities that impact the borrowers' economic performance. We are not obligated to provide support beyond our stated commitment to the borrowers, and accordingly our maximum exposure to loss as a result of this relationship is limited to the amount of our outstanding notes receivable. The VIEs that we have identified at September 30, 2025 are summarized in the table below.


Classification	Carrying Amount (in thousands)		Maximum Exposure to Loss (in thousands)


Note receivable (revolving credit facility)	$	1,960	$	1,960
Note receivable (mortgage note)	$	2,000	$	2,000

Community Healthcare Trust Inc 10-Q