BrightSpire Capital Inc
For the period ended Dec 31, 2024. Filed Feb 19, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Feb 19, 2025
BRSP$3.34-3.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-02-21.
0001717547-24-000008
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-02-19.
0001717547-25-000008
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 324 previous paragraphs and 300 current paragraphs.
188 unchanged; 58 reworded; 49 added; 72 removed; 6 previous and 5 current paragraphs rearranged.
Tables are not compared: 25 previous and 20 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (49)
Current report
•During the third quarter of 2024, we executed a $675.0 million securitization transaction through BRSP 2024-FL2 (as defined in “Liquidity and Capital Resources”), contributing 22 senior floating-rate mortgages secured by 25 properties, totaling $590.2 million, which resulted in the sale of $583.9 million of investment grade notes (the “2024-FL2 Notes”). The transaction also features a two-year reinvestment period and available proceeds of $84.8 million to be used within a six-month ramp-up acquisition period from closing. The securitization reflects an initial advance rate of 86.5% at a weighted cost of funds of Term SOFR plus 2.47% (before transaction costs). At December 31, 2024, the securitization was collateralized by a pool of 24 senior loan investments and had remaining available proceeds of $30.3 million. See “Liquidity and Capital Resources” below for further discussion;
Current report
•On August 19, 2024, we redeemed the outstanding securities under CLNC 2019-FL1, including the investment grade notes issued thereunder (the “2019-FL1 Notes”), at a redemption price of $311.6 million. The 14 senior loan investments, with an aggregate unpaid principal balance of $477.7 million, held by CLNC 2019-FL1 (as defined below) were refinanced by the issuance of the securities under BRSP 2024-FL2, including the 2024-FL2 Notes, and with an existing Master Repurchase Facility;
Current report
•Repurchased 1.2 million shares of our Class A common stock at a weighted average price of $5.52 for an aggregate cost of $6.6 million;
Current report
◦Originated four senior mortgage loans with a total commitment of $75.6 million. The average initial funded amount was $15.6 million and had a weighted average spread of SOFR plus 4.06%;
Current report
◦Reduced the total number of watchlist loans (loans with a risk ranking of 4 or 5) from 10 to seven (refer to “Our Portfolio” for further discussion):
Current report
▪Removed five loans with an aggregate unpaid principal balance of $152.7 million;
Current report
▪Added two loans with an unpaid principal balance of $97.5 million;
Current report
◦Recorded our share of GAAP impairment of $53.3 million on four office properties and $134.6 million of non-GAAP impairment of real estate on nine properties. Refer to “Non-GAAP Supplemental Financial Measures - Undepreciated Book Value Per Share” for further discussion;
Current report
◦Acquired one Fort Worth, Texas multifamily property through foreclosure with an initial fair value of $33.5 million and consolidated the assets and liabilities of one Arlington, Texas multifamily property. As a result, the properties are now classified as real estate;
Current report
◦Sold one office property for net proceeds of $19.1 million and recognized a realized gain of $0.1 million; and
Current report
•Subsequent to December 31, 2024, we:
Current report
◦Originated two senior mortgage loans with a total commitment of $52.7 million. The average initial funded amount was $26.0 million and had a weighted average spread of SOFR plus 2.95%; and
Current report
◦Sold one office property for a gross sales price of $5.5 million.
Current report
Financial Results
Current report
•Generated GAAP net loss of $132.0 million, or $(1.05) per basic and diluted share, Distributable Earnings of $71.2 million or $0.55 per share and Adjusted Distributable Earnings of $109.2 million or $0.84 per share for theyear ended December 31, 2024. Distributable Earnings and Adjusted Distributable Earnings are non-GAAP financial measures. A reconciliation of these measures to net income/(loss) attributable to the Company’s common stockholders is in the section “Non-GAAP Supplemental Financial Measures” below.
Current report
Very Low Risk
Current report
Low Risk
Current report
Medium Risk
Current report
High Risk/Potential for Loss—A loan that has a high risk of realizing a principal loss.
Current report
Impaired/Loss Likely—A loan that has a very high risk of realizing a principal loss or has otherwise incurred a principal loss.
Current report
(5)Represents a property where we recorded impairment during the year ended December 31, 2024. For Net lease 5, three individual properties were impaired.
Current report
(7)The mortgage payable collateralized by Other real estate 1 was extended in December 2024 to December 2027, the current maturity date. We have a one-year extension available, subject to satisfaction of certain customary conditions set forth in the governing documents.
Current report
(8)The mortgage payable collateralized by Other real estate 2 is in maturity default as of January 2025. We are currently negotiating an extension with our lender and remain current on interest payments.
Current report
(9)Property was acquired through foreclosure or deed-in-lieu of foreclosure.
Current report
Interest income decreased by $53.9 million to $244.8 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The decrease was primarily due to $40.4 million from loan repayments, $12.4 million from loans placed on nonaccrual status, and $8.5 million from the acquisition of six properties through deeds-in-lieu and foreclosure and one loan consolidated as real estate. This was partially offset by $3.9 million from higher interest rates, loan originations of $1.6 million, and proceeds of $1.2 million from interest on cash related to the BRSP 2024-FL2 ramp up.
Current report
Interest expense decreased by $19.4 million to $153.9 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The decrease was primarily due to $30.8 million in repayments, partially offset by the net impact of the BRSP 2024-FL2 issuance and the unwinding of the CLNC 2019-FL1 securitization trust following the redemption of all outstanding securities thereunder of $12.0 million.
Current report
Other income decreased by $2.3 million to $11.6 million during the year ended December 31, 2024, as compared to the year ended December 31, 2023. The decrease was primarily driven by lower income on money market investments.
Current report
Property operating expense increased by $7.2 million to $33.9 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase was primarily driven by property acquisitions during 2023 and 2024.
Current report
Transaction, investment and servicing expense decreased by $0.9 million to $1.6 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The decrease was primarily due to costs associated with a secondary offering of shares of our Class A common stock in the first quarter of 2023.
Current report
Depreciation and amortization expense increased by $7.0 million to $40.5 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase was primarily driven by property acquisitions during 2023 and 2024.
Current report
Increase of CECL reserve
Current report
We recorded total CECL reserves of $135.8 million during the year ended December 31, 2024, which is comprised of $97.8 million of general reserves and $38.0 million of specific reserves. The increase in our general CECL reserve was primarily driven by the macroeconomic conditions, as well as specific inputs on certain office and multifamily properties utilized in our general CECL model. We recorded specific CECL reserves related to three multifamily senior loans, two office senior loans, and a development mezzanine loan during the year ended December 31, 2024. The specific reserves were charged off during the year ended December 31, 2024. We recorded total CECL reserves of $108.1 million during the year ended December 31, 2023, primarily driven by an increase of specific reserves related to three office senior loans, one multifamily senior loan, and a development mezzanine loan.
Current report
During the year ended December 31, 2024, we recorded impairment of $54.2 million on four office properties following a reduction in the current expected holding period in connection with our preparation of our quarterly financial reporting. During the year ended December 31, 2023, we recorded $7.6 million on one office property following a reduction in the current expected holding period in connection with our preparation of our quarterly financial reporting.
Current report
Compensation and benefits decreased by $4.9 million to $34.6 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The decrease was primarily driven by lower stock compensation and payroll-related expenses.
Current report
Operating expense decreased by $1.3 million to $11.9 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023, primarily due to lower third-party costs.
Current report
Other gain, net decreased by $0.4 million to $0.2 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. This was primarily due to lower unrealized gains on foreign currency hedges. As of December 31, 2024, we hold no foreign currency hedges.
Current report
Income tax expense decreased by a de minimis amount to $1.1 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023.
Current report
Impairment of operating real estate
Current report
Undepreciated Book Value Per Share
Current report
On August 19, 2024, we redeemed the outstanding securities under CLNC 2019-FL1, including the 2019-FL1 Notes, at a redemption price of $311.6 million. The 14 senior loan investments, with an aggregate unpaid principal balance of $477.7 million, held by CLNC 2019-FL1 were refinanced by the proceeds from the issuance of the securities under BRSP 2024-FL2 (as defined below), including the 2024-FL2 Notes (as defined below), and an existing Master Repurchase Facility.
Showing the first 40 of 49 passages. Open the source sections for the rest.
Removed paragraphs (72)
Previous report
There were no changes in the structure of our internal organization that prompted the change in reportable segments. Prior year amounts have been recast to conform to the current year presentation. Accordingly, we realigned the discussion and analysis of our portfolio and results of operations to reflect these reportable segments.
Previous report
•Generated GAAP net loss of $15.5 million, or $0.12 per basic and diluted share, Distributable Earnings of $66.1 million, or $0.51 per share and Adjusted Distributable Earnings of $138.2 million or $1.06 per share for the year ended December 31, 2023;
Previous report
◦Placed five senior loans on nonaccrual status; four of which were acquired through foreclosure or deed-in-lieu of foreclosure;
Previous report
◦Acquired the following through foreclosure or deed-in-lieu of foreclosure:
Previous report
▪Two Long Island City, New York office properties with an initial aggregate fair value of $73.1 million (one of the underlying office senior loans was previously placed on nonaccrual status in 2022);
Previous report
▪One Oakland, California office property with an initial fair value of $13.9 million;
Previous report
▪One Washington, D.C. office property with an initial fair value of $19.6 million, which is classified as held for sale as of December 31, 2023;
Previous report
▪One Phoenix, Arizona multifamily property with an initial fair value of $35.2 million;
Previous report
During the third quarter of 2023, the Company simplified its risk ranking definitions. The Company re-evaluated its risk rankings based on the simplified definitions and concluded that there was no impact to prior period risk rankings.
Previous report
•Repayments: one hotel loan with a risk ranking of 4 was partially repaid (refer to “Our Portfolio - Asset Specific Loan Summaries” section for further discussion);
Previous report
(8)Loan 78 has a payment-in-kind provision and accrues interest at 13.0%.
Previous report
Asset Specific Loan Summaries
Previous report
San Jose, California Hotel Senior Loan
Previous report
We originated a $173.5 million senior loan for the sponsor’s purchase of an 805-room San Jose hotel (the “San Jose Hotel Loan”) in 2018. At closing, the borrower contributed approximately $90.0 million of equity toward the acquisition.
Previous report
After the hotel was closed in August 2020 due to the COVID-19 pandemic, the borrower filed for bankruptcy and emerged from bankruptcy in November 2021 with an upsized $184.9 million senior loan and a $25.0 million mezzanine loan. The hotel reopened in April 2022 and in 2023 we increased the loan balance twice to $193.4 million to fund debt service payments. Hotel occupancy was below 40% throughout 2023.
Previous report
The hotel guest rooms are located in the 541-room main tower and a 264-room south tower. In November 2023, the south tower was sold for $73.1 million and will be converted to graduate student housing for San Jose State University. The net proceeds from the sale totaled $66.9 million, of which $9.4 million was used to fund reserves and $57.5 million was used to pay down the loan principal balance.
Previous report
Tualatin, Oregon Office Park Senior Loan
Previous report
We originated a $45.8 million senior loan torefinance the sponsor’s existing loan on a Tualatin office complex (the “Tualatin Office Loan”) in 2021. The Tualatin Office Loan included an initial funding of $38.6 million with an additional $7.2 million of future advances.
Previous report
The Tualatin office properties consist of ten buildings averaging 34,000 square feet each. The Tualatin office buildings were 70% occupied when the Tualatin Office Loan was originated and included future advances to finance additional tenant improvements for the anticipated new leasing activity. Prior to our origination of the Tualatin Office Loan, the sponsor had invested $6.0 million into an upgraded fitness center, new heating, ventilation, and cooling system, resurfaced parking lots, and signage.
Previous report
The lack of new leasing at the Tualatin office properties combined with rising interest rates has led to debt service exceeding monthly net operating income. The loan was modified in December 2023 to extend the maturity to December 2024, reduce the loan spread from 3.96% to 1.5%, and include an exit fee upon repayment of the loan of 2.5% of the principal balance. The modification allows the sponsor to utilize tenant improvements and leasing commission funds for capital improvements such as rezoning the collateral for additional commercial uses, and exploring rezoning certain parcels for multifamily use. Additionally, the sponsor funded $0.3 million into a reserve to fund operating shortfalls.
Previous report
To the extent that leasing projections for the Tualatin office properties worsen, and given the uncertainty in the office market, this may result in a valuation impairment or investment loss.
Previous report
Denver, Colorado Multifamily Senior Loan
Previous report
We originated a $30.9 million senior loan in 2022 to finance the acquisition and capital improvement of a 142-unit multifamily property located in Denver, Colorado. The loan included an initial funding of $27.9 million with an additional $2.9 million of future funding.
Previous report
The property cash flow is insufficient to cover the debt service and interest reserves have been exhausted. The sponsor is unwilling to further support the asset due to the challenges at the property level which include low occupancy, delinquent rent payments and tenant evictions. Additionally, the current capital market environment is unlikely to allow for a return of equity to the sponsor.
Previous report
The loan defaulted as of the January 9, 2024 payment date. However, the sponsor is cooperating with a consensual sale process through a national commercial real estate sales advisor and the sale process was launched in January 2024. The sale resolution may result in a valuation impairment or investment loss.
Previous report
(6)Property was acquired through a deed-in-lieu of foreclosure.
Previous report
(7)Property was acquired through foreclosure.
Previous report
Asset Specific Net Leased and Other Real Estate Summaries
Previous report
Warehouse Distribution Portfolio Net Lease
Previous report
In August 2018 we acquired two warehouse distribution facilities located in Tracy, California and Tolleson, Arizona (the “Warehouse Distribution Portfolio”) for $292 million. These two properties are 100% occupied by a creditworthy single tenant. The tenant is a national grocer and these properties form a part of its national distribution network. The Warehouse Distribution Portfolio lease (the “Warehouse Distribution Portfolio Lease”) requires the tenant to pay for all real estate-related expenses, including operational expenditures, capital expenditures and taxes. The tenant has invested a significant amount of capital expenditures into each property over the past few years. The Warehouse Distribution Portfolio Lease has a remaining lease term of 14.6 years ending in 2038. The tenant has the option to extend the lease for nine five-year periods at the same terms with rent adjusted to market rent. The Warehouse Distribution Portfolio Lease also has annual rent increases of 1.5%. Financing on the Warehouse Distribution Portfolio consists of mortgage and mezzanine debt for a total combined amount payable of $200 million. The debt is interest only at a blended fixed rate of 4.8% and matures in September 2028. The debt has a defeasance provision for any early loan prepayment. The tenant has made all rent payments and is current on all its financial obligations under the Warehouse Distribution Portfolio Lease. The tenant has announced a merger with another national grocer, which is pending regulatory approval. If the merger is approved, it is not expected to impact our lease agreement.
Previous report
The Warehouse Distribution Portfolio has generated net operating income for the year ended December 31, 2023, of $20.2 million and the asset value on our consolidated balance sheet is $245.0 million as of December 31, 2023.
Previous report
Stavanger, Norway Office Net Lease
Previous report
In July 2018, we acquired a class A office campus in Stavanger, Norway (the “Norway Net Lease”) for $320 million (NOK 2.6 billion). This property is 100% occupied by a creditworthy single tenant. The property serves as their global headquarters. The Norway Net Lease requires the tenant to pay for all real estate-related expenses, including operational expenditures, capital expenditures and municipality taxes. The Norway Net Lease has a weighted average remaining lease term of six years and the tenant has the option to extend for two five-year periods at the same terms with rent adjusted to market rent, with the ability to reduce their total occupied space, and there is a risk that the rent can decrease at that time. The Norway Net Lease also has annual rent increases based on the Norwegian CPI Index through 2030. The rent increase in 2023 was 6.1%. Our tenant has injected a significant amount of capital into improvements of the property over the past 10 years.
Previous report
Financing on the Norway Net Lease consists of a mortgage payable of$157.2 million (NOK 1.6 billion) with a fixed rate of 3.9%, which matures in June 2025, at which time there will be five years remaining on the initial lease term. The financing includes a provision for annual appraisal valuation each May with loan-to-value (“LTV”) tests declining from 75% LTV beginning in year five, to 70% LTV after year eight and 65% LTV after year nine. The most recent valuation in May 2023 resulted in an LTV above the current 70% threshold. As a result, we contributed $3.5 million of cash to our entity thereby putting us in compliance with the LTV test. The $3.5 million is included in cash and cash equivalents on our consolidated balance sheet and remains available for our use. Market conditions could impact property valuations and continuing compliance with these annual tests, resulting in a cash trap subject to LTV rebalancing.
Previous report
This five-year remaining lease term along with risk of a downward rent adjustment at the 2030 renewal, and the increase in interest rates, could adversely impact the refinancing or sale of the asset. Furthermore, we have no assurances that the tenant will remain at the property beyond 2030. The tenant has made all rent payments and is current on all its financial obligations under the lease. Both the lease payments and mortgage debt service are NOK denominated currency. We maintain a series of USD-NOK forward swaps in order to minimize our foreign currency cash flow risk. These forward swaps occur quarterly through May 2024, where we have agreed to sell NOK and buy USD at a locked in forward curve rate. However, only the lease payments are hedged through May 2024. The net equity and lease payments beyond May 2024 are not hedged at this time. Therefore, the Norway Net Lease net book value may be subject to fluctuations based on the USD-NOK impact on unhedged values.
Previous report
Phoenix, Arizona Multifamily Property
Previous report
We originated a $47.0 million senior loan to finance the sponsor’s acquisition of a 236 unit multifamily property located in Phoenix, AZ (the “Multifamily Property”) in 2021. The loan’s initial term was two years with three one-year extension options. The loan initially funded $43.5 million to partially capitalize the Multifamily Property acquisition by the sponsor for $59.1 million. In addition, the loan was structured with a $3.5 million future funding component for capital expenditures.
Previous report
The Multifamily Property was built in 1973 and later renovated in 2021 by the previous owner. The Multifamily Property consists of 23 two-story apartment buildings situated on ten acres. The common amenities include covered parking, swimming pool, gym, picnic area, secured access gate, on-site laundry and a fenced in dog park. Of the 236 units, the previous ownership renovated 110 units. The sponsor’s business plan was to renovate the remaining units at the same scope of the previous owner’s renovation program. The sponsor spent $1.4 million of future funding to address deferred maintenance and to renovate 30 incremental units.
Previous report
In April 2023, occupancy dropped significantly and cash flow was not sufficient to cover debt service. The sponsor raised $1.6 million in additional capital from their limited partners to cover the monthly shortfalls and purchase an interest rate cap at the December 2023 maturity. In October 2023, the additional capital was depleted and the sponsor went back to their limited partners for a second capital raise, which was unsuccessful and the sponsor did not have the funds to cover the monthly shortfalls.
Previous report
A mutual decision was made between us and the sponsor to deed the Multifamily Property to us. The deed-in-lieu of foreclosure was finalized in December 2023. In connection with the deed-in-lieu of foreclosure, we obtained a valuation and purchase price allocation from a third-party valuation expert. The valuation resulted in a $10.0 million valuation loss during the fourth quarter of 2023, and the Multifamily Property has a carrying value of $35.4 million at December 31, 2023. We are currently operating the property with a plan to increase occupancy, renovate vacant units, and address additional deferred maintenance.
Showing the first 40 of 72 passages. Open the source sections for the rest.
Reworded paragraphs (58)
Previous wording
We are a commercial real estate (“CRE”) credit real estate investment trust (“REIT”) focused on originating, acquiring, financing and managing a diversified portfolio consisting primarily of CRE debt investments and net leased properties predominantly in the United States. CRE debt investments primarily consist of first mortgage loans, which is our primary investment strategy. Additionally, we may also selectively originate mezzanine loans and preferred equity investments, which may include profit participations. The mezzanine loans and preferred equity investments may be in conjunction with our origination of corresponding first mortgages on the same properties. Net leased properties consist of CRE properties with long-term leases to tenants on a net-lease basis, where such tenants generally will be responsible for property operating expenses such as insurance, utilities, maintenance capital expenditures and real estate taxes. We continue to target net leased equity investments on a selective basis.
Current wording
We are a commercial real estate (“CRE”) credit real estate investment trust (“REIT”) focused on originating, acquiring, financing and managing a diversified portfolio consisting primarily of CRE debt investments and net leased properties predominantly in the United States. CRE debt investments primarily consist of first mortgage loans, which is our primary investment strategy. Additionally, we may also selectively originate mezzanine loans and preferred equity investments, which may include profit participations. The mezzanine loans and preferred equity investments may be in conjunction with our origination of corresponding first mortgages on the same properties. Net leased properties consist of CRE properties with long-term leases to tenants on a net-lease basis, where such tenants generally will be responsible for property operating expenses such as insurance, utilities, maintenance capital expenditures and real estate taxes.
Previous wording
During the fourth quarter of 2023, we realigned the business and reportable segment information to reflect how the Chief Operating Decision Makers now regularly review and manage the business. As a result, we present our business as one portfolio through the following business segments:
Current wording
We present our business as one portfolio through the following business segments:
Previous wording
•Senior and Mezzanine Loans and Preferred Equity—CRE debt investments including senior loans, mezzanine loans, and preferred equity interests as well as participations in such loans.
Current wording
•Senior and Mezzanine Loans and Preferred Equity—CRE debt investments including senior and mezzanine loans, and preferred equity interests as well as participations in such loans.
Previous wording
•Net Leased and Other Real Estate—direct investments in commercial real estate with long-term leases to tenants on a net lease basis, where such tenants generally will be responsible for property operating expenses such as insurance, utilities, maintenance, capital expenditures and real estate taxes. It also includes other real estate, currently consisting of two investments with direct ownership in commercial real estate, with an emphasis on properties with stable cash flow and five additional properties that we acquired through foreclosure or deed-in-lieu of foreclosure.
Current wording
•Net Leased and Other Real Estate—direct investments in commercial real estate with long-term leases to tenants on a net lease basis, where such tenants generally will be responsible for property operating expenses such as insurance, utilities, maintenance, capital expenditures and real estate taxes. It also includes other real estate, currently consisting of two investments with direct ownership in commercial real estate, with an emphasis on properties with stable cash flow, five additional properties that we acquired through foreclosure or deed-in-lieu of foreclosure and one property that we consolidate as the primary beneficiary.
Previous wording
•Declared total quarterly dividends of $0.80 per share during the year ended December 31, 2023.
Current wording
•Declared total quarterly dividends of $0.72 per share during the year ended December 31, 2024; and
Previous wording
•As of the date of this report, we have approximately $368.0 million of liquidity, consisting of $203.0 million cash and cash equivalents on hand and $165.0 million available on our Bank Credit Facility; and
Current wording
•As of the date of this report, we have approximately $418.0 million of liquidity, consisting of $253.0 million cash and cash equivalents on hand and $165.0 million available on our Bank Credit Facility.
Previous wording
◦Received loan repayment proceeds of $453.5 million from 13 loans;
Current wording
◦Received loan repayment proceeds of $417.8 million from 22 loans;
Previous wording
◦Recorded $81.2 million in specific current expected credit loss (“CECL”) reserves related to four senior loans and one mezzanine loan. At December 31, 2023, there were no specific CECL reserves on our consolidated balance sheet (refer to “Our Portfolio - Asset Specific Loan Summaries” section for further discussion);
Current wording
◦Recorded $38.0 million in specific current expected credit loss (“CECL”) reserves related to five senior loans and one mezzanine loan. At December 31, 2024, there were no specific CECL reserves on our consolidated balance sheet;
Previous wording
◦Recorded a net increase in our general CECL reserves of $27.0 million. At December 31, 2023, our general CECL reserve for our outstanding loans and future loan funding commitments is $76.5 million, which is 2.46% of the aggregate commitment amount of our loan portfolio;
Current wording
◦Recorded a net increase in our general CECL reserves of $89.7 million. At December 31, 2024, our general CECL reserve for our outstanding loans and future loan funding commitments is $166.1 million, which is 6.34% of the aggregate commitment amount of our loan portfolio;
Previous wording
◦Extended 28 loans eligible for certain maturity events, which represent $988.7 million of unpaid principal balance at December 31, 2023; and
Current wording
◦Extended 59 loans eligible for certain maturity events, which represent $2.0 billion of unpaid principal balance at December 31, 2024;
Previous wording
•Subsequent to December 31, 2023, we received loan repayment proceeds of $26.7 million from three loans.
Current wording
◦Received loan repayment proceeds of $99.8 million from six loans;
Previous wording
Although global markets showed signs of stabilization and inflationary pressure may be moderating due to increased interest rates through the third quarter of 2023, CRE value uncertainties, aftershock of the COVID-19 pandemic and geopolitical unrest continue to contribute to market volatility. Generationally high interest rates have continued to negatively impact transaction activity in the real estate market and correspondingly the loan financing market. To the extent certain of our borrowers are experiencing significant financial dislocation as a result of economic conditions, we have and may continue to use interest and other reserves and/or replenishment obligations of the borrower and/or guarantors to meet current interest payment obligations for a limited period. The market for office properties was particularly negatively impacted by the COVID-19 pandemic and continues to experience headwinds driven by the normalization of work from home and hybrid work arrangements and elevated costs to operate or reconfigure office properties. These factors have largely resulted in lower demand for office space and driven rising vacancy rates. Given the uncertainty in the office market, there is risk of future valuation impairment or investment loss on our loans secured by office properties.
Current wording
Although global markets showed signs of stabilization and inflationary pressure may be moderating, CRE value uncertainties, lingering impact from COVID-19 and geopolitical unrest continue to contribute to market volatility. Generationally high interest rates have continued to negatively impact transaction activity in the real estate market and correspondingly the loan financing and refinancing opportunities. While the Federal Reserve lowered interest rates in the second half of 2024, it is uncertain as to when, how many and by how much subsequent interest rate cuts will be made in 2025. To the extent certain of our borrowers are experiencing significant financial dislocation as a result of economic conditions, we have and may continue to use interest and other reserves and/or replenishment obligations of the borrower and/or guarantors to meet current interest payment obligations for a limited period. The market for office properties was particularly negatively impacted by the COVID-19 pandemic and continues to experience headwinds driven by the normalization of work from home and hybrid work arrangements and elevated costs to operate or reconfigure office properties. Although “return to office” mandates are on the rise, the demand for office space generally remains lower than pre-COVID-19 pandemic levels and has driven rising vacancy rates. Given the continuing uncertainty in the office market, there is risk of future valuation impairment or investment loss on our loans secured by office properties. Similarly, these trends may impact our ability to manage debt covenant tests, maturity dates and/or seek suitable refinancing opportunities on certain of our office property equity investments, which may adversely impact valuation assessments and cash flow generated by such investments.
Previous wording
While macroeconomic conditions are expected to continue to normalize, we cannot predict whether they will in fact improve or even intensify. Due to the inherent uncertainty of these conditions, their impact on our business is difficult to predict and quantify.
Current wording
While macroeconomic conditions continue to be challenged, we cannot predict whether they will in fact improve or even intensify. Due to the inherent uncertainty of these conditions, their impact on our business is difficult to predict and quantify.
Previous wording
We consider and treat our assets as long-term investments. As a result, we do not expect that changes in market value will impact our operating results. However, at least on a quarterly basis, we assess both our ability and intent to hold such assets for the long-term. As part of this process, we monitor our assets for impairment. A change in our ability and/or intent to continue to hold any of our assets may result in our recognizing an impairment charge or realizing losses upon the sale of such investments.
Current wording
We consider and treat our assets as long-term investments. As a result, we do not expect that changes in market value will impact our operating results. However, at least on a quarterly basis, we assess both our ability and intent to hold such assets for the long-term. As part of this process, we monitor our assets for impairment. A change in our ability and/or intent to continue to hold any of our assets, which includes the inability to modify, extend or refinance existing mortgage debt on our real estate portfolio, may result in our recognizing an impairment charge or realizing losses upon the sale of such investments.
Previous wording
As of December 31, 2023, our portfolio consisted of 103 investments representing approximately $3.8 billion in carrying value (based on our share of ownership and excluding cash, cash equivalents and certain other assets). Our senior and mezzanine loans consisted of 87 senior and mezzanine loans with a weighted average cash coupon of 3.7% and a weighted average all-in unlevered yield of 9.3%. Our net leased and other real estate consisted of approximately 7.0 million total square feet of space and total 2023 NOI of that portfolio was approximately $66.5 million. Refer to “Non-GAAP Supplemental Financial Measures” below for further information on NOI.
Current wording
As of December 31, 2024, our portfolio consisted of 93 investments representing approximately $3.3 billion in carrying value (based on our share of ownership and excluding cash, cash equivalents and certain other assets). Our senior and mezzanine loans consisted of 76 senior and mezzanine loans with a weighted average cash coupon of 3.4% and a weighted average all-in unlevered yield of 7.6%. Our net leased and other real estate consisted of approximately 6.9 million total square feet of space and total 2024 NOI of that portfolio was approximately $67.7 million. Refer to “Non-GAAP Supplemental Financial Measures” below for further information on NOI.
Previous wording
•Downgrades: one multifamily loan was downgraded to a risk ranking of 5 from a risk ranking of 4;
Current wording
•Upgrades: one multifamily loan and one office loan were upgraded to a risk ranking of 3 from a risk ranking of 4;
Previous wording
•Other: one multifamily loan with a risk ranking of 5 was resolved when the property was acquired through a deed-in-lieu of foreclosure and reclassified to real estate owned; and one office loan with a risk ranking of 5 was resolved when the property was acquired through legal foreclosure and reclassified to real estate held for sale.
Current wording
•Other: one multifamily loan with a risk ranking of 5 was resolved when the property was acquired through a foreclosure and reclassified to real estate owned.
Previous wording
The following tables provides a summary of our senior and mezzanine loans based on our internal risk rankings, collateral property type and geographic distribution as of December 31, 2023 (dollars in thousands):
Current wording
The following tables provide a summary of our senior and mezzanine loans based on our internal risk rankings, collateral property type and geographic distribution as of December 31, 2024 (dollars in thousands):
Previous wording
(1)Represents carrying values at our share as of December 31, 2023.
Current wording
(1)Represents carrying values at our share as of December 31, 2024 and excludes general CECL reserves.
Previous wording
(2)Represents the stated coupon rate for loans; for floating rate loans, does not include Secured Overnight Financing Rate (“SOFR”), which was 5.35% as of December 31, 2023.
Current wording
(2)Represents the stated coupon rate for loans; for floating rate loans, does not include Secured Overnight Financing Rate (“SOFR”), which was 4.33% as of December 31, 2024.
Previous wording
(5)On a quarterly basis, the Company’s senior and mezzanine loans are rated “1” through “5,” from less risk to greater risk. Represents risk ranking as of December 31, 2023.
Current wording
(5)On a quarterly basis, our senior and mezzanine loans are rated “1” through “5,” from less risk to greater risk. Represents risk ranking as of December 31, 2024.
Previous wording
(7)Loan 26 was placed on nonaccrual status in December 2023; as such, no income is being recognized.
Current wording
(7)Loan 65 was placed on nonaccrual status in April 2024; as such, no income is being recognized.
Previous wording
(2)Loan 26 was placed on nonaccrual status in December 2023; as such, no income is being recognized.
Current wording
(8)Loan 67 was placed on nonaccrual status in June 2024; as such, no income is being recognized.
Previous wording
At December 31, 2023, our general CECL reserve for our outstanding loans and future loan funding commitments is $76.5 million, which is 2.46% of the aggregate commitment amount of our loan portfolio. This represents an increase of $21.5 million from $55.0 million or 1.67% of the aggregate commitment amount of our loan portfolio at September 30, 2023. This increase was primarily driven by the operating performance of certain office and hotel assets. During the fourth quarter of 2023, we recorded $10.0 million of specific CECL reserves related to one Phoenix, Arizona multifamily senior loan prior to acquiring the asset through a deed-in-lieu of foreclosure. As a result, the $10.0 million in specific CECL reserves were charged off. At December 31, 2023, there are no specific CECL reserves on our consolidated balance sheet.
Current wording
At December 31, 2024, our general CECL reserve for our outstanding loans and future loan funding commitments is $166.1 million, which is 6.34% of the aggregate commitment amount of our loan portfolio. This represents an increase of $10.4 million from $155.7 million or 5.78% of the aggregate commitment amount of our loan portfolio at September 30, 2024. The increase in our general CECL reserve was primarily driven by specific inputs on certain multifamily and office loans utilized in our general CECL model. During the fourth quarter of 2024, we recorded total specific CECL reserves of $10.0 million related to one multifamily loan and one office loan which were subsequently charged off during the quarter. As a result, we have no specific CECL reserves at December 31, 2024.
Previous wording
Our net leased real estate investment strategy focuses on direct ownership in commercial real estate with an emphasis on properties with stable cash flow, which may be structurally senior to a third-party partner’s equity. As part of our net leased real estate strategy, we explore a variety of real estate investments including multi-tenant office, multifamily, student housing and industrial. Additionally, we have two investments in direct ownership of commercial real estate and own these operating real estate investments through joint ventures with one or more partners. We also own five properties included in other real estate that were acquired through deeds-in-lieu of foreclosure and foreclosure.
Current wording
Our net leased real estate investment strategy focuses on direct ownership in commercial real estate with an emphasis on properties with stable cash flow, which may be structurally senior to a third-party partner’s equity. As part of our net leased real estate strategy, we explore a variety of real estate investments including multi-tenant office, multifamily, student housing and industrial. Additionally, we have two investments in direct ownership of commercial real estate and own these operating real estate investments through joint ventures with one or more partners. We also own five properties included in other real estate that were acquired through deeds-in-lieu of foreclosure and foreclosure and consolidate one property after being deemed the primary beneficiary of the variable interest entity holding it.
Previous wording
As of December 31, 2023, $869.3 million or 22.8% of our assets were invested in net leased and other real estate properties and these properties were 88.1% occupied. The following table presents our net leased and other real estate investments as of December 31, 2023 (dollars in thousands):
Current wording
As of December 31, 2024, $814.9 million or 24.4% of our assets were invested in net leased and other real estate properties and these properties were 88.7% occupied. The following table presents our net leased and other real estate investments as of December 31, 2024 (dollars in thousands):
Previous wording
(5)Net lease 5 consists of two separate mortgage notes.
Current wording
(6)Net lease 5 consists of two separate mortgage notes.
Previous wording
Property operating income decreased by $12.4 million to $90.2 million forthe year ended December 31, 2022, as compared to the year ended December 31, 2021. The decrease was primarily the result of two property sales in the first quarter of 2022 and the sale of an industrial portfolio in the first quarter of 2021.
Current wording
Property operating income increased by$9.0 million to$102.4 million forthe year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase was primarily driven by property acquisitions during 2023 and 2024.
Previous wording
Property operating income increased by $3.2 million to $93.4 million forthe year ended December 31, 2023, as compared to the year ended December 31, 2022. The increase was primarily due to $4.0 million from five real estate foreclosures in 2023 and a tax refund and higher reimbursement income of $1.0 million at two office properties partially offset by $1.7 million from two real estate properties sold in the first quarter of 2022.
Current wording
Property operating income increased by$3.2 million to$93.4 million forthe year ended December 31, 2023, as compared to the year ended December 31, 2022. The increase was primarily due to $4.0 million from five real estate foreclosures in 2023 and a tax refund and higher reimbursement income of $1.0 million at two office properties partially offset by $1.7 million from two real estate properties sold in the first quarter of 2022.
Previous wording
We define Distributable Earnings as GAAP net income (loss) attributable to our common stockholders (or, without duplication, the owners of the common equity of our direct subsidiaries, such as our OP) and excluding (i) non-cash equity compensation expense, (ii) the expenses incurred in connection with our formation or other strategic transactions, (iii) the incentive fee, (iv) acquisition costs from successful acquisitions, (v) gains or losses from sales of real estate property and impairment write-downs of depreciable real estate, including unconsolidated joint ventures and preferred equity investments, (vi) general CECL reserves determined by probability of default/loss given default (“PD/LGD”) model, (vii) depreciation and amortization, (viii) any unrealized gains or losses or other similar non-cash items that are included in net income for the current quarter, regardless of whether such items are included in other comprehensive income or loss, or in net income, (ix) one-time events pursuant to changes in GAAP and (x) certain material non-cash income or expense items that in the judgment of management should not be included in Distributable Earnings. For clauses (ix) and (x), such exclusions shall only be applied after approval by a majority of our independent directors. Distributable Earnings include specific CECL reserves when realized. Loan losses are realized when such amounts are deemed nonrecoverable at the time the loan is repaid, or if the underlying asset is sold following foreclosure, or if we determine that it is probable that all amounts due will not be collected; realized loan losses to be included in Distributable Earnings is the difference between the cash received, or expected to be received, and the book value of the asset.
Current wording
We define Distributable Earnings as GAAP net income (loss) attributable to our common stockholders (or, without duplication, the owners of the common equity of our direct subsidiaries, such as our OP) and excluding (i) non-cash equity compensation expense, (ii) the expenses incurred in connection with our formation or other strategic transactions, (iii) acquisition costs from successful acquisitions, (iv) gains or losses from sales of real estate property and impairment write-downs of depreciable real estate, including unconsolidated joint ventures and preferred equity investments, (v) general CECL reserves, (vi) depreciation and amortization, (vii) any unrealized gains or losses or other similar non-cash items that are included in net income for the current quarter, regardless of whether such items are included in other comprehensive income or loss, or in net income, (viii) one-time events pursuant to changes in GAAP and (ix) certain material non-cash income or expense items that in the judgment of management should not be included in Distributable Earnings. For clauses (viii) and (ix), such exclusions shall only be applied after approval by a majority of our independent directors. Distributable Earnings include specific CECL reserves.
Previous wording
Additionally, we define Adjusted Distributable Earnings as Distributable Earnings excluding (i) realized gains and losses on asset sales, (ii) fair value adjustments, which represent mark-to-market adjustments to investments in unconsolidated ventures based on an exit price, defined as the estimated price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants, (iii) unrealized gains or losses, (iv) realized specific CECL reserves and (v) one-time gains or losses that in the judgement of management should not be included in Adjusted Distributable Earnings. We believe Adjusted Distributable Earnings is a useful indicator for investors to further evaluate and compare our operating performance to our peers and our ability to pay dividends, net of the impact of any gains or losses on assets sales or fair value adjustments, as described above.
Current wording
Additionally, we define Adjusted Distributable Earnings as Distributable Earnings excluding (i) realized gains and losses on asset sales, (ii) fair value adjustments, which represent mark-to-market adjustments to investments in unconsolidated ventures based on an exit price, defined as the estimated price that would be received upon the sale of an asset or paid to transfer a liability in an orderly transaction between market participants, (iii) unrealized gains or losses, (iv) specific CECL reserves and (v) one-time gains or losses that in the judgement of management should not be included in Adjusted Distributable Earnings. We believe Adjusted Distributable Earnings is a useful indicator for investors to further evaluate and compare our operating performance to our peers and our ability to pay dividends, net of the impact of any gains or losses on assets sales or fair value adjustments, as described above.
Previous wording
The following tables present a reconciliation of net income (loss) attributable to our common stockholders to Distributable Earnings and Adjusted Distributable Earnings attributable to our common stockholders and noncontrolling interest of the Operating Partnership (dollars and share amounts in thousands, except per share data) for the years ended December 31, 2023, 2022 and 2021:
Current wording
The following tables present a reconciliation of net income (loss) attributable to our common stockholders to Distributable Earnings and Adjusted Distributable Earnings attributable to our common stockholders (dollars and share amounts in thousands, except per share data) for the years ended December 31, 2024, 2023 and 2022:
Previous wording
(1)We calculate Distributable Earnings (Loss) per share, and Adjusted Distributable Earnings per share, non-GAAP financial measures, based on a weighted-average number of common shares and OP units (held by members other than us or our subsidiaries). For the year ended December 31, 2022 includes 3.1 million OP units until their redemption in May 2022. For the year ended December 31, 2021 weighted average number of common shares includes 3.1 million OP units.
Current wording
(1)We calculate Distributable Earnings (Loss) per share, and Adjusted Distributable Earnings per share, non-GAAP financial measures, based on a weighted-average number of common shares and OP units (held by members other than us or our subsidiaries). For the year ended December 31, 2022 includes 3.1 million OP units until their redemption in May 2022.
Previous wording
(1)Excludes the impact of our pro-rata share of accumulated depreciation and amortization on real estate investments (including related intangible assets and liabilities).
Current wording
We believe that presenting undepreciated book value per share is a more useful and consistent measure of the value of our current portfolio and operations for our investors. It additionally enhances the comparability to our peers who do not hold real estate investments. Undepreciated book value per share excludes our share of accumulated depreciation and amortization on real estate investments (including related intangible assets and liabilities). It also excludes our share of the carrying value (including any related foreign currency translation) on certain net leased and other real estate office properties whose non-recourse mortgages mature within 12 months or who have been placed in a cash flow sweep by their lender. Our ability to refinance at their maturity dates is burdened by the current interest rate environment, lenders’ aversion to finance or refinance office properties and/or associated improvements or paydowns potentially demanded at such properties. Loan maturity defaults can lead to foreclosures. Given this potential likelihood, we believe it is prudent to recognize impairments and exclude our share of the carrying value related to these properties.
Previous wording
We have a multi-pronged financing strategy that includes an up to $165.0 million secured revolving credit facility as of December 31, 2023, up to approximately $2.0 billion in secured revolving repurchase facilities, $913.9 million in non-recourse securitization financing, $617.4 million in commercial mortgages and $34.5 million in other asset-level financing structures.
Current wording
We have a multi-pronged financing strategy that includes an up to $165.0 million secured revolving credit facility as of December 31, 2024, up to approximately $2.0 billion in secured revolving repurchase facilities, $1.1 billion in non-recourse securitization financing, $587.2 million in commercial mortgages and $34.5 million in other asset-level financing structures.
Previous wording
(1)Represents (i) total consolidated outstanding secured debt less cash and cash equivalents of $257.5 million and $306.3 million at December 31, 2023 and December 31, 2022, respectively to (ii) total equity, in each case, at period end.
Current wording
(1)Represents (i) total consolidated outstanding secured debt less cash and cash equivalents of $302.2 million and $257.5 million at December 31, 2024 and December 31, 2023, respectively to (ii) total equity, in each case, at period end.
Previous wording
As discussed in greater detail above under “Trends Affecting our Business,” and “Factors Impacting Our Operating Results” overall market uncertainty coupled with rising inflation and interest rates have tempered the loan financing markets recently. A rising interest rate environment will result in increased interest expense on our variable rate debt that is not hedged and may result in disruptions to our borrowers’ and tenants’ ability to finance their activities, which would similarly adversely impact their ability to make their monthly mortgage payments and meet their loan obligations. Additionally, due to the current market conditions, warehouse lenders may take a more conservative stance by increasing funding costs, which may lead to margin calls.
Current wording
As discussed in greater detail above under “Trends Affecting our Business,” and “Factors Impacting Our Operating Results” overall market uncertainty coupled with rising inflation and high interest rates have tempered the loan financing markets recently. A high interest rate environment will result in increased interest expense on our variable rate debt that is not hedged and may result in disruptions to our borrowers’ and tenants’ ability to finance their activities, which would similarly adversely impact their ability to make their monthly mortgage payments and meet their loan obligations. Additionally, due to the current market conditions, warehouse lenders may take a more conservative stance by increasing funding costs, which may lead to margin calls.
Previous wording
$165.0 million. If any borrowing is outstanding for more than 180 days after its initial draw, the borrowing base valuation will be reduced by 50% until all outstanding borrowings are repaid in full. The ability to borrow new amounts under the Credit Agreement terminates on January 31, 2026, at which time the OP may, at its election and by written notice to the Administrative Agent, extend the termination date for two (2) additional terms of six (6) months each, subject to the terms and conditions in the Credit Agreement, resulting in a latest termination date of January 31, 2027.
Current wording
The maximum amount available for borrowing at any time under the Credit Agreement is limited to a borrowing base valuation of certain investment assets, with the valuation of such investment assets generally determined according to a percentage of adjusted net book value. As of December 31, 2024, the borrowing base valuation is sufficient to permit borrowings of up to the entire $165.0 million. If any borrowing is outstanding for more than 180 days after its initial draw, the borrowing base valuation will be reduced by 50% until all outstanding borrowings are repaid in full. The ability to borrow new amounts under the Credit Agreement terminates on January 31, 2026, at which time the OP may, at its election and by written notice to the Administrative Agent, extend the termination date for two additional terms of six months each, subject to the terms and conditions in the Credit Agreement, resulting in a latest termination date of January 31, 2027.
Previous wording
Currently, our primary source of financing is our Master Repurchase Facilities, which we use to finance the origination of senior loans. Repurchase agreements effectively allow us to borrow against loans that we own in an amount generally equal to (i) the market value of such loans multiplied by (ii) the applicable advance rate. Under these agreements, we sell our loans to a counterparty and agree to repurchase the same loans from the counterparty at a price equal to the original sales price plus an interest factor. During the term of a repurchase agreement, we receive the principal and interest on the related loans and pay interest to the lender under the master repurchase agreement. We intend to maintain formal relationships with multiple counterparties to obtain master repurchase financing.
Current wording
Currently, our primary sources of financing the origination of first mortgage loans and senior loan participations secured by senior loan investments are our repurchase agreements with multiple global financial institutions (each, a “Master Repurchase Facility” and collectively, the “Master Repurchase Facilities”). The Master Repurchase Facilities, effectively allow us to borrow against loans that we own in an amount generally equal to (i) the market value of such loans multiplied by (ii) the applicable advance rate. Under these agreements, we sell our loans to a counterparty and agree to repurchase the same loans from the counterparty at a price equal to the original sales price plus an interest factor. During the term of a repurchase agreement, we receive the principal and interest on the related loans and pay interest to the lender under the master repurchase agreement. We intend to maintain formal relationships with multiple counterparties to obtain master repurchase financing.
Previous wording
The following table presents a summary of our Master Repurchase and Bank Credit Facilities as of December 31, 2023 (dollars in thousands):
Current wording
The following table presents a summary of our Master Repurchase Facilities and Bank Credit Facility as of December 31, 2024 (dollars in thousands):
Showing the first 40 of 58 pairs. Open the source sections for the rest.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
•Downgrades: one multifamily loan was downgraded to a risk ranking of 5 from a risk ranking of 4 and another multifamily loan was downgraded to a risk ranking of 4 from a risk ranking of 3;
Current report — wording carried from elsewhere
Interest expense on real estate increased by $1.1 million to $27.0 million for the year ended December 31, 2024, as compared to the year ended December 31, 2023. The increase was primarily due to amortization income recorded on above-market debt during the year ended December 31, 2023.
Current report — wording carried from elsewhere
We did not record equity in earnings of unconsolidated ventures during theyear ended December 31, 2024. During theyear ended December 31, 2023, we realized a one-time gain from our ratable share of dispute resolution proceeds of approximately $9.0 million from the senior mezzanine lender of the Development Mezzanine Loan in connection with our prior Los Angeles, California mixed-use project and retained B-participation investment. In connection with the settlement, effective January 26, 2023, we have no further interest in the loan or investment.
Current report — wording carried from elsewhere
Equity in earnings of unconsolidated ventures
Current report — wording carried from elsewhere
Our operating activities provided net cash inflows of $103.4 million and $137.6 million for the years ended December 31, 2024 and 2023, respectively. Net cash provided by operating activities decreased for the year ended December 31, 2024 compared to the year ended December 31, 2023 primarily due to lower net interest income recorded during the year ended December 31, 2024.
Rearranged previous paragraphs (6)
Previous report — wording carried elsewhere
Net interest income on mortgage loans and obligations held in securitization trusts, net
Previous report — wording carried elsewhere
Unrealized gain on mortgage loans and obligations held in securitization trusts, net
Previous report — wording carried elsewhere
Realized loss on mortgage loans and obligations held in securitization trusts, net
Previous report — wording carried elsewhere
The maximum amount available for borrowing at any time under the Credit Agreement is limited to a borrowing base valuation of certain investment assets, with the valuation of such investment assets generally determined according to a percentage of adjusted net book value. As of date hereof, the borrowing base valuation is sufficient to permit borrowings of up to
Previous report — wording carried elsewhere
As of February 19, 2022, the benchmark index interest rate was converted from Compounded SOFR to Term SOFR, plus a benchmark adjustment of 11.448 basis points, conforming with the indenture agreement. Term SOFR for any interest accrual period shall be the one-month CME Term SOFR Reference Rate as published by the CME Group Benchmark Administration on each benchmark determination date.
Previous report — wording carried elsewhere
Current Expected Credit Loss (“CECL” reserve)