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

Annual report pursuant to Section 13 and 15(d)

Our Portfolio - Financing Receivables, Investments, Real Estate and Equity Method Investments (Tables)

Our Portfolio - Financing Receivables, Investments, Real Estate and Equity Method Investments (Tables)

12 Months Ended

Dec. 31, 2014

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 December 31, 2014, with 98% of the debt and real estate portion of our Portfolio rated investment grade as shown below:


	Investment Grade
	Government (1)			Commercial Investment Grade (2)			Commercial Non-Investment Grade (3)			Subtotal, Debt and Real Estate			Equity Method Investment (4)		Total
	(dollar amounts in millions)
Financing receivables	$	284		$	268		$	1		$	553		$	—	$	553
Financing receivables held-for-sale		62			—			—			62			—		62
Investments		—			13			14			27			—		27
Real estate (5)		—			114			—			114			—		114
Equity method investment		—			—			—			—			144		144

Total	$	346		$	395		$	15		$	756		$	144	$	900

% of Debt and Real Estate Portfolio		46	%		52	%		2	%		100	%		N/A		N/A
Average Remaining Balance (6)	$	11		$	9		$	14		$	10		$	14	$	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 $263 million of U.S. federal government transactions and $83 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, including institutions such as hospitals or universities, that have been rated investment grade (either by an independent rating agency or based on our internal credit analysis). Of this total, $56 million of the transactions have been rated investment grade by an independent rating agency.

(3)

Transactions where the projects or the ultimate obligors are commercial entities, including institutions such as hospitals or universities, that have ratings below investment grade either by an independent rating agency or using our internal credit analysis. Financing receivables are net of an allowance for credit losses of $1.2 million.

(4)	Consists of minority ownership interest in operating wind projects in which we earn a preferred return.

(5)	Includes the real estate and the lease intangible assets through which we receive scheduled lease payments, typically under long-term triple net lease agreements.

(6)	Average Remaining Balance excludes 75 transactions each with outstanding balances that are less than $1.0 million and that in the aggregate total $21.0 million.

Components of Financing Receivables

The components of financing receivables of December 31, 2014 and 2013 were as follows:


	December 31, 2014			December 31, 2013
	(amounts in millions)
Financing receivables
Financing or minimum lease payments (1)	$	723.1		$	504.7
Unearned interest income		(166.0	)		(142.3	)
Allowance for credit losses		(1.2	)		(11.0	)
Unearned fee income, net of initial direct costs		(3.2	)		(3.5	)

Financing receivables (1)	$	552.7		$	347.9

(1)	Excludes $62.3 million and $24.8 million in financing receivables held-for-sale at December 31, 2014 and 2013, respectively.

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 December 31, 2014:


	Total			Less than 1 year			1-5 years			5-10 years			More than 10 years
Financing Receivables (1)
Payment due by period	$	552.7		$	14.0		$	46.8		$	46.9		$	445.0
Weighted average yield by period (2)		5.47	%		5.88	%		7.67	%		5.73	%		5.20	%
Investments
Payment due by period	$	27.3		$	—		$	14.1		$	—		$	13.2
Weighted average yield by period		5.57	%		—	%		5.76	%		—	%		5.37	%

(1)	Excludes financing receivables held-for-sale of $62.3 million and the allowance for credit losses of $1.2 million.

(2)	Excludes yield on remaining $0.8 million loan balance that is on non-accrual status after the $1.2 million allowance for loan loss recorded as of December 2014.

Components of Real Estate Portfolio

The components of our real estate portfolio as of December 31, 2014 and 2013 were as follows:


	December 31,
	2014			2013
	(amounts in million)
Real Estate
Land	$	90.9		$	—
Real estate related intangibles		23.3			—
Accumulated amortization of real estate intangibles		(0.2	)		—

Real Estate	$	114.0		$	—

Future Amortization Expenses Related to Intangible Assets

As of December 31, 2014, the future amortization expense to be recognized related to these intangible assets was:


	(amounts in millions)
Year Ending December 31,
2015	$	0.6
2016		0.6
2017		0.6
2018		0.6
2019		0.6
Thereafter		20.1

Total	$	23.1

Future Minimum Rental Income under Land Lease Agreements

As of December 31, 2014, the future minimum rental income under our land lease agreements was as follows:


	(amounts in millions)
Year Ending December 31,
2015	$	8.7
2016		8.7
2017		8.7
2018		8.7
2019		8.7
Thereafter		293.5

Total	$	337.0