The interest income is definitely reportable, and taxable. I'd also think that the entity that PAID the interest would want to show that as an expense.
Do you typically issue tax documents for your real estate company?
Yes, we typically issue 1099-MISC forms. Should I send a 1099-INT for the interest payment to the entity that loaned the money?
Yes, if the interest amount earned by the recipient is over $10 for the year you should file Form 1099-INT with the IRS, for the interest amount received.
@dothomas You've seen the answer offered by @DianeW777 . But to clarify, the 1099-INT will be issued to the RECIPIENT of the interest. That entity must report the income.