(a)Deferred financing costs related to all other debt liabilities (other than for the revolving credit facility) are netted against those debt liabilities for all periods presented. See Note 2: Significant Accounting Policies – Deferred Financing Costs.

(b)Includes as of September 30, 2021 and December 31, 2020, respectively, an interest-free note receivable with a net present value of $0.8 million and $1.2 million which matures in April 2023. Also includes $4.8 million, net of a loan loss allowance of $5.2 million, as of September 30, 2021, of seller-financing provided by the Company to the buyers of the Metropark portfolio. The receivable is secured against available cash of one of the Metropark properties disposed of and earned an annual return of four percent for 90 days after the disposition, with the interest rate increased to 15 percent thereafter. The Company recorded a loan loss allowance charge of $5.2 million at September 30, 2021 based on expected losses, by calculating the net present value of estimated cash flows of one property of the Metropark portfolio as the Company considered the principal amount to be past due (See Note 12: Disclosure of fair value of assets and liabilities). Such charge was recorded in Interest and other investment income (loss) for the three and nine months ended September 30, 2021. The Company elected to account for the Metropark receivable under the cost recovery method and moved the Metropark receivable to a non-accrual status. There is no interest accrued associated with the note receivable. See Note 3: Transactions – Real Estate Held for Sale/Discontinued Operations/Dispositions.

(c)All goodwill is attributable to the Company’s Multi-family Real Estate and Services segment.

(d)This amount has a corresponding liability of $23.7 million, which is included in Accounts payable, accrued expense and other liabilities. See Note 13: Commitments and Contingencies – Ground Lease agreements for further details.

(e)Includes as of September 30, 2021 and December 31, 2020, $1.7 million and $42.5 million, respectively, for properties classified as discontinued operations.

DERIVATIVE FINANCIAL INSTRUMENTS

Cash Flow Hedges of Interest Rate Risk

The Company’s objectives in using interest rate derivatives are to add stability to interest expense and to manage its exposure to interest rate movements. To accomplish this objective, the Company has historically used interest rate swaps as part of its interest rate risk management strategy. As of September 30, 2021 and December 31, 2020, the Company did not have any outstanding interest rate swaps that were designated as cash flow hedges of interest rate risk.

The changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive income and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. Amounts reported in accumulated other comprehensive income related to derivatives will be reclassified to interest expense as interest payments are made on the Company’s variable-rate debt. During the next 12 months, the Company estimates no additional amount to be reclassified to interest expense.

The table below presents the effect of the Company’s derivative financial instruments on the Consolidated Statement of Operations for the nine months ending September 30, 2021 and 2020 (dollars in thousands):

Credit-risk-related Contingent Features

The Company had agreements with each of its derivative counterparties that contained a provision where the Company could be declared in default on its derivative obligations if repayment of the underlying indebtedness was accelerated by the lender due to the Company's default on the indebtedness. As of September 30, 2021, the Company did not have any outstanding derivatives.