HCP, INC. | 2013 | FY | 3

(10) Other Assets

        The Company's other assets consisted of the following (in thousands):

 
   December 31,  
 
   2013   2012  

Straight-line rent assets, net of allowance of $34,230 and $33,521, respectively

   $ 368,919   $ 306,294  

Marketable debt securities(1)

     244,089     222,809  

Leasing costs, net

     104,601     93,763  

Deferred financing costs, net

     42,106     45,490  

Goodwill

     50,346     50,346  

Marketable equity securities

     —     24,829  

Other(2)

     57,644     44,989  
           

Total other assets

   $ 867,705   $ 788,520  
           
           
(1)
Includes £137.0 million of Four Seasons senior unsecured notes translated into U.S. dollars (see below for additional information).

(2)
Includes a $5.4 million allowance for losses related to accrued interest receivable on the Delphis loan. At both December 31, 2013 and 2012, the net carrying value of interest accrued related to the Delphis loan was zero. See Note 7 for additional information about the Delphis loan and the related impairment. At both December 31, 2013 and 2012, includes a loan receivable of $10 million from HCP Ventures IV, LLC, an unconsolidated joint venture (see Note 8 for additional information) with an interest rate of 12% which matures in May 2014. The loan is secured by the Company's joint venture partner's 80% partnership interest in the joint venture.

        In June 2011, the Company purchased approximately $22 million of marketable equity securities that were classified as available-for-sale. At December 31, 2011, the Company incurred a $5 million impairment for these securities as it concluded the decrease in value of such securities below their carrying value was other-than-temporary. At December 31, 2012, the fair value and adjusted cost basis of the marketable equity securities were $25 million and $17 million, respectively. During the year ended December 31, 2013, the Company realized gains from the sale of marketable equity securities of $11 million, which were included in other income, net.

        On June 28, 2012, the Company purchased senior unsecured notes with an aggregate par value of £138.5 million at a discount for £136.8 million ($214.9 million). The notes were issued by Elli Investments Limited, a subsidiary of Terra Firma, a European private equity firm, as part of its financing for the acquisition of Four Seasons Health Care ("Four Seasons"), an elderly and specialist care provider in the United Kingdom. The notes mature in June 2020 and are non-callable through June 2016. The notes bear interest on their par value at a fixed rate of 12.25% per annum, with an original issue discount resulting in a yield to maturity of 12.5%. This investment was financed by a GBP denominated unsecured term loan that is discussed in Note 11. These senior unsecured notes are accounted for as marketable debt securities and classified as held-to-maturity.

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