HA Sustainable Infrastructure Capital, Inc. Quarterly report pursuant to Section 13 or 15(d)

Quarterly report pursuant to Section 13 or 15(d)

Our Portfolio (Tables)

Our Portfolio (Tables)

3 Months Ended

Mar. 31, 2017

Analysis of Portfolio by Type of Obligor and Credit Quality

The following is an analysis of our Portfolio by type of obligor and credit quality as of March 31, 2017:


	Investment Grade
	Government ⁽¹⁾			Commercial ⁽²⁾			Commercial Non-Investment Grade ⁽³⁾			Subtotal, Debt and Real Estate			Equity Method Investments		Total
	(dollars in millions)
Financing receivables	$	496		$	496		$	21		$	1,013		$	—	$	1,013
Investments		103			22			—			125			—		125
Real estate⁽⁴⁾		—			289			—			289			21		310
Equity investments in renewable energy projects		—			—			—			—			428		428

Total	$	599		$	807		$	21		$	1,427		$	449	$	1,876

% of Debt and Real Estate Portfolio		42	%		57	%		1	%		100	%		N/A		N/A
Average Remaining Balance ⁽⁵⁾	$	12		$	9		$	10		$	10		$	20	$	11

(1)

Transactions where the ultimate obligor is the U.S. federal government or state or local governments where the obligors are rated investment grade (either by an independent rating agency or based upon our internal credit analysis). This amount includes $334 million of U.S. federal government transactions and $265 million of transactions where the ultimate obligors are state or local governments. Transactions may have guaranties of energy savings from third party service providers, the majority of which are entities rated investment grade by an independent rating agency.

(2)

Transactions where the projects or the ultimate obligors are commercial entities, that have been rated investment grade (either by an independent rating agency or based on our internal credit analysis). Of this total, $11 million of the transactions have been rated investment grade by an independent rating agency. Commercial investment grade financing receivables include $306 million of internally rated residential solar loans made on a nonrecourse basis to special purpose subsidiaries of SunPower Corporation, for which we rely on certain limited indemnities, warranties and other obligations of SunPower Corporation or its other subsidiaries.

(3)	Transactions where the projects or the ultimate obligors are commercial entities that have ratings below investment grade (either by an independent rating agency or using our internal credit analysis).

(4)	Includes the real estate and the lease intangible assets (including those held through equity method investments) from which we receive scheduled lease payments, typically under long-term triple net lease agreements.

(5)	Excludes approximately 125 transactions each with outstanding balances that are less than $1 million and that in the aggregate total $45 million.

Components of Financing Receivables

The components of financing receivables as of March 31, 2017 and December 31, 2016, were as follows:


	March 31, 2017			December 31, 2016
	(dollars in millions)
Financing receivables
Financing or minimum lease payments	$	1,332		$	1,395
Unearned interest income		(317	)		(351	)
Unearned fee income, net of initial direct costs		(2	)		(2	)

Financing receivables	$	1,013		$	1,042

Summary of Anticipated Maturity Dates of Financing Receivables and Investments and Weighted Average Yield

The following table provides a summary of our anticipated maturity dates of our financing receivables and investments and the weighted average yield for each range of maturities as of March 31, 2017:


	Total			Less than 1 year			1-5 years			5-10 years			More than 10 years
	(dollars in millions)
Financing receivables
Maturities by period	$	1,013		$	5		$	33		$	65		$	910
Weighted average yield by period		5.2	%		6.2	%		6.3	%		4.7	%		5.2	%
Investments
Maturities by period	$	125		$	—		$	—		$	1		$	124
Weighted average yield by period		4.2	%		—	%		—	%		4.7	%		4.2	%

Components of Real Estate Portfolio

The components of our real estate portfolio as of March 31, 2017 and December 31, 2016, were as follows:


	March 31, 2017			December 31, 2016
	(dollars in millions)
Real Estate
Land	$	213		$	145
Lease intangibles		79			29
Accumulated amortization of lease intangibles		(3	)		(2	)

Real Estate	$	289		$	172

Schedule of Future Amortization Expenses Related to Intangible Assets and Future Minimum Rental Income Payments under Land Lease Agreements

As of March 31, 2017, the future amortization expense of these intangible assets and the future minimum rental income payments under our land lease agreements are as follows:


Years Ending December 31,	Future Amortization Expense		Minimum Rental Income Payments
	(dollars in millions)
From April 1, 2017 to December 31, 2017	$	2	$	12
2018		2		16
2019		2		16
2020		2		16
2021		2		17
2022		2		17
Thereafter		64		577

Total	$	76	$	671