Q3 2025 Apollo Commercial Real Estate Finance Inc Earnings Call
Is strictly prohibited information about the audio replay of this call is available in our earnings press release I'd also like to call your attention to the customary safe Harbor disclosure in our press release regarding forward looking statements today's conference call and webcast may include forward looking statements and projections and we ask that you refer to our most recent filings.
With the SEC for important factors that could cause actual results to differ materially from these statements and projections. In addition, we will be discussing certain non-GAAP measures on this call, which management believes are relevant to assessing the company's financial performance.
Speaker #1: Information about the audio replay of this call is available in our earnings press release. I'd also like to call your attention to the customary Safe Harbor disclosure in our press release regarding forward-looking statements.
These measures are reconciled to GAAP figures in our earnings presentation, which is available in the stockholder section of our website, we do not undertake any obligation to update our forward looking statements or projections unless required by law to obtain copies of our latest SEC filings. Please visit our website at www Dot Apollo.
Speaker #1: Today's conference call and webcast may include forward-looking statements and projections, and we ask that you refer to our most recent filings with the SEC for important factors that could cause actual results to differ materially from these statements and projections.
Speaker #1: In addition, we will be discussing certain non-GAAP measures on this call, which management believes are relevant to assessing the company's financial performance. These measures are reconciled to GAAP figures in our earnings presentation, which is available in the stockholders' section of our website.
<unk> dot com or call us at 2125153200 at this time I'd like to turn the call over to the company's Chief Executive Officer Stuart Rothstein.
Operator: These measures are reconciled to GAAP figures in our earnings presentation, which is available in the stockholder section of our website. We do not undertake any obligation to update our forward-looking statements or projections unless required by law. To obtain copies of our latest SEC filings, please visit our website at www.ApolloCreft.com or call us at 212-515-3200. At this time, I'd like to turn the call over to the company's Chief Executive Officer, Stuart Rothstein. Thank you. Good morning, and thank you for joining us on the Apollo Commercial Real Estate Finance Q3 2025 earnings call. As usual, I am joined today by Scott Weiner, our Chief Investment Officer, and Anastasia Mironova, our Chief Financial Officer. ARI's Q3 was highlighted by continued strong origination activity and progress with our focus assets as transaction activity and operating performance in the broader real estate market continues to improve.
Speaker #1: We do not undertake any obligation to update our forward-looking statements or projections unless required by law. To obtain copies of our latest SEC filings, please visit our website at www.apollocref.com or call us at 212-515-3200.
Thank you.
Good morning, and thank you.
Joining us on the Apollo commercial real estate finance third quarter 2025 earnings call as.
As usual I am joined today by Scott Weiner, our Chief investment Officer.
Anastasia <unk>, our Chief Financial Officer.
Speaker #1: At this time, I'd like to turn the call over to the company's Chief Executive Officer, Stuart Rothstein.
<unk> third quarter was highlighted by continued strong origination activity and progress with our focus assets as transit as transaction activity and operating performance in the broader real estate market continues to improve.
Speaker #2: Thank you. Good morning and thank you for joining us on the Apollo Commercial Real Estate Finance third quarter 2025 earnings call. As usual, I am joined today by Scott Weiner, our Chief Investment Officer, and Anastasia Mironova, our Chief Financial Officer.
Importantly, as capital from focus assets is freed up and made available for redeployment into newly originated loans.
Speaker #2: ARI's third quarter was highlighted by continued strong origination activity and progress with our focus assets, as transaction activity and operating performance in the broader real estate market continue to improve.
<unk> continues to benefit from the strength and breadth of the of the Apollo real estate credit platform overall.
Overall Apollo is on pace for a record year of commercial real estate loan originations with over $19 billion closed to date. This provides <unk> with an incredibly robust pipeline of transactions and enables us to effectively deploy capital and construct a diversified loan portfolio.
Operator: Importantly, as capital from focus assets is freed up and made available for redeployment into newly originated loans, ARI continues to benefit from the strength and breadth of the Apollo Real Estate Credit Platform. Overall, Apollo is on pace for a record year of commercial real estate loan originations, with over $19 billion closed to date. This provides ARI with an incredibly robust pipeline of transactions and enables us to effectively deploy capital and construct a diversified loan portfolio on behalf of ARI. During the quarter, ARI committed to an additional $1 billion of new loans, bringing year-to-date originations to $3 billion. Consistent with recent activity, this quarter's originations were divided between the U.S. and Europe. ARI's ability to deploy capital in Europe continues to be a differentiating factor. Apollo is the most active alternative lender in Europe, which has a fragmented lender universe given the less developed securitization market.
Speaker #2: Importantly, as capital from focus assets is freed up and made available for redeployment into newly originated loans, ARI continues to benefit from the strength and breadth of the Apollo Real Estate Credit Platform.
<unk> on behalf of <unk>.
During the quarter Ari committed to an additional $1 billion of new loans, bringing year to date originations to $3 billion consistent with recent activity. This quarter's originations were divided between the U S and Europe.
Speaker #2: Overall, Apollo is on pace for a record year of commercial real estate loan originations, with over $19 billion closed to date. This provides ARI with an incredibly robust pipeline of transactions and enables us to effectively deploy capital and construct a diversified loan portfolio on behalf of ARI.
<unk> ability to deploy capital in Europe continues to be a differentiating factor Apollo is the most active alternative lender in Europe, which has a fragmented lender universe, given the less developed securitization market.
Speaker #2: During the quarter, ARI committed to an additional $1 billion of new loans, bringing year-to-date originations to $3 billion. Consistent with recent activity, this quarter's originations were divided between the U.S.
Abundant mentals in Europe remain healthy across property types, and with a lower rate environment, enabling transactions to have positive leverage again the acquisition market has picked up significantly.
Speaker #2: and Europe. ARI's ability to deploy capital in Europe continues to be a differentiating factor. Apollo is the most active alternative lender in Europe, which has a fragmented lender universe given the less developed securitization market.
The third quarter loans closed included residential and industrial transactions and as of the end of the third quarter residential loans encompassing multifamily for sale residential senior housing and student housing represents <unk> largest underlying property type.
Operator: Fundamentals in Europe remain healthy across property types, and with the lower-rate environment enabling transactions to have positive leverage again, the acquisition market has picked up significantly. The Q3 loans closed included residential and industrial transactions, and as of the end of Q3, residential loans encompassing multifamily, for-sale residential, senior housing, and student housing represent ARI's largest underlying property type in the portfolio at 31%. Repayments continued to track expectations, with $1.3 billion of repayments and sales during the quarter bringing year-to-date repayments to $2.1 billion. Turning now to the loan portfolio and an update on ARI's focus assets, at Quarter End, the carrying value of the portfolio totaled $8.3 billion. 54% of ARI's loan portfolio now represents loans originated post the 2022 rate hikes.
Speaker #2: Fundamentals in Europe remain healthy across property types, and with the lower rate environment enabling transactions to have positive leverage again, the acquisition market has picked up significantly.
And the portfolio at 31%.
Speaker #2: The third-quarter loans closed included residential and industrial transactions. As of the end of the third quarter, residential loans encompassing multifamily, for-sale residential, senior housing, and student housing represent ARI's largest underlying property type in the portfolio at 31%.
Repayments continued to track expectations with one $3 billion of repayments and sales during the quarter, bringing year to date repayments to $2 1 billion.
Turning now to the loan portfolio and an update on our eyes focused assets at quarter end, the carrying value of the portfolio totaled $8 3 billion.
Speaker #2: Repayments continued to track expectations, with $1.3 billion of repayments and sales during the quarter, bringing year-to-date repayments to $2.1 billion. Turning now to the loan portfolio and an update on ARI's focus assets, at quarter end, the carrying value of the portfolio totaled $8.3 billion.
54% of Ari's loan portfolio now represents loans originated post the 2022 rate hikes.
The headline for Arris focused assets is continued sales momentum at 111 West 57th Street.
With six new contracts signed since the last earnings call three of which closed post quarter end generating approximately $55 million in proceeds and further reducing ari's loan basis.
Speaker #2: Fifty-four percent of ARI's loan portfolio now represents loans originated post the 2022 rate hikes. The headline for ARI's focus assets is continued sales momentum at $111.57, with six new contracts signed since the last earnings call, three of which closed post-quarter end, generating approximately $55 million in proceeds and further reducing ARI's loan basis.
At the Brook Ari's multifamily development in Brooklyn, we have seen strong leasing velocity to date and are still on target to exit that investment in the second half of 2026 and.
Operator: The headline for ARI's focus assets is continued sales momentum at 111 W 57th Street, with six new contracts signed since the last earnings call, three of which closed post-Quarter End, generating approximately $55 million in proceeds and further reducing ARI's loan basis. At The Brooke, ARI's multifamily development in Brooklyn, we have seen strong leasing velocity to date and are still on target to exit that investment in the second half of 2026. Anastasia will discuss in her comments, but we expect this capital rotation out of focus assets will have a meaningful impact on ARI's earnings run rate going forward. Shifting to the right side of our balance sheet, ARI continues to maintain robust liquidity and has access to additional capital from the company's various secured financing facilities. ARI's lenders remain actively engaged in the sector, with ongoing dialogue around in-place or potential new financings.
<unk> will discuss in her comments, but we expect this capital rotation out of focus assets will have a meaningful impact on ari's earnings run rate going forward.
Speaker #2: At the Brooke, ARI's multifamily development in Brooklyn, we have seen strong leasing velocity to date and are still on target to exit that investment in the second half of 2026.
Shifting to the right side of our balance sheet.
Continues to maintain robust liquidity and has access to additional capital from the company's various secured financing facilities.
Speaker #2: Anastasia will discuss in her comments, but we expect this capital rotation out of focus assets will have a meaningful impact on ARI's earnings run rate going forward.
Ari's lenders remain actively engaged in this sector with ongoing dialogue around in place or potential new financings.
<unk> continues to diversify the company's lender base and expand sources of capital having entered into new secured entered into a new secured borrowing facility during the quarter in Europe. In addition, we upsize the borrowing capacity on our revolving credit facility by $115 million.
Speaker #2: Shifting to the right side of our balance sheet, ARI continues to maintain robust liquidity and has access to additional capital from the company's various secured financing facilities.
Speaker #2: ARI's lenders remain actively engaged in the sector, with with ongoing dialogue around in-place or potential new financings. ARI continues to diversify the company's lender base and expand sources of capital having entered into new secured entered into a new secured borrowing facility during the quarter in Europe.
And extended the maturity to August of 2028 with that I will turn the call over to Anastasia to review <unk> financial results for the quarter.
Operator: ARI continues to diversify the company's lender base and expand sources of capital, having entered into a new secured borrowing facility during the quarter in Europe. In addition, we upsized the borrowing capacity on our revolving credit facility by $115 million and extended the maturity to August of 2028. With that, I will turn the call over to Anastasia to review ARI's financial results for the quarter. Thank you, Stuart, and good morning, everyone. For the Q3 of 2025, ARI reported GAAP net income of $48 million, or $0.34 per diluted share of common stock. Distributable earnings were $42 million, or $0.30 per share. Distributable earnings prior to realized loss on investments and realized gain on litigation settlement, or the measure we refer to as run rate distributable earnings, was $32 million, or $0.23 per share of common stock.
Thank you Stuart and good morning, everyone.
For the third quarter of 2025.
Speaker #2: In addition, we upsized the borrowing capacity on our revolving credit facility by $115 million and extended the maturity to August of 2028. With that, I will turn the call over to Anastasia to review ARI's financial results for the quarter.
<unk> reported GAAP net income of 48 million or 34 cents per diluted share of common stock.
Distributable earnings were 42 million or 30 30 cents per share.
Distributable earnings Brian to realized loss on investments and the realized gain on litigation settlement or the measurement referred to its run rate just to maintain if we're earning with $32 million or 23.
Speaker #3: Thank you, Stuart. And good morning, everyone. For the third quarter of 2025, ARI reported GAAP net income of $48 million, or 34 cents per diluted share of common stock.
Share of common stock.
Run rate distributable earnings during the quarter was slightly below the dividend method.
Speaker #3: Distributable earnings were $42 million, or 30 cents per share. Distributable earnings prior to realized loss and investments and realized gain on litigation settlement, or the measure we refer to as run rate, distributable earnings, was $32 million, or 23 cents per share of common stock.
Given the timing of redeployment of capital within the quarter.
It is worth noting that we often do not have control over the timing of new loan transactions clothing, and its currently into the timing of repayments in the portfolio.
Reinvestment of proceeds from unit sales at 11, 111 West 57.
Operator: Run rate distributable earnings during the quarter were slightly below the dividend level, given the timing of redeployment of capital within the quarter. It is worth noting that we often do not have control over the timing of new loan transactions closing and its correlation to the timing of repayments in the portfolio. Reinvestment of proceeds from unit sales at 111 W 57th will provide upside to earnings in Q4 and further in 2026. We continue to address other focus assets in our portfolio and foresee resolutions on a number of them towards the second part of the year in 2026. Recycling of capital from those subperforming assets will provide further uplift to earnings at the end of 2026. During the quarter, we received discounted payoff proceeds associated with our Michigan office loan, which was previously fully reserved.
Speaker #3: Run rate distributable earnings during the quarter were slightly below the dividend level, given the timing of redeployment of capital within the quarter. It is worth noting that we often do not have control over the timing of new loan transactions closing and its correlation to the timing of repayments in the portfolio.
Provide upside to earnings in Q4 and further in 2026.
We continue to address other smoker.
Personally and foresee resolutions in a number of them towards the second part of the year in 2026.
Recycling of capital from the non performing asset Rupert.
Speaker #3: Reinvestment of proceeds from unit sales at $111.57 will provide upside to earnings in Q4 and further in 2026. We continue to address other focus assets in our portfolio, and foresee resolutions on a number of them, towards the second part of the year in 2026.
Further uplift to earnings at the end of 2026.
During the quarter, we received a discounted payoff proceeds associated with our Michigan office loan, which you had previously fully reserved.
As a result, we recorded a partial reversal of the specifics you feel alone and the amount of $1 3 million and the charge off of $6 2 million.
Speaker #3: Recycling of capital from those sub-performing assets will provide further uplift to earnings at the end of 2026. During the quarter, we received discounted payoff proceeds associated with our Michigan office loan, which was previously fully reserved.
We also realized a $1 2 million of law when sale of the promissory note, which was previously reflected note receivable held for sale when our balance sheet.
This realized loss was in line with the previously recorded valuation allowance.
Operator: As a result, we recorded a partial reversal of the specific CFIL allowance in the amount of $1.3 million and a charge-off of $6.2 million. We also realized a $1.2 million loss on sale of the promissory note, which was previously reflected as no receivable held for sale on our balance sheet. This realized loss was in line with the previously recorded valuation allowance for this asset. Additionally, during the quarter, we recognized a $17.4 million gain in connection with the settlement of the litigation related to one of the assets in the Massachusetts healthcare portfolio. The aggregate impact of these events was a $0.14 increase in book value per share. As a result, our book value per share, excluding general CFIL allowance and depreciation, was $12.73 as of the end of the quarter.
Speaker #3: As a result, we recorded a partial reversal of the specific CISO allowance in the amount of $1.3 million, and the charge-off of $6.2 million.
Additionally, during the quarter, we recognized $17 4 million gain in connection with the settlement of the litigation related to one of the assets in the Massachusetts health care portfolio.
Speaker #3: We also realized a $1.2 million loss on sale of the promissory note, which was previously reflected as note receivable held for sale on our balance sheet.
The aggregate impact of these events was 14% increase in book value per share.
As a result, our book value per share, excluding junior Isa allowance and depreciation was $12.73.
As of the end of the quarter.
Our loan portfolio ended the quarter with a carrying value of $8 3 billion.
And the weighted average unlevered yield of seven 7%.
If you already mentioned, we had a strong quarter of loan originations totaling $1 billion and completing an additional 234 million in funding for previously closed loans.
Operator: Our loan portfolio ended the quarter with a carrying value of $8.3 billion and the weighted average unleveraged yield of 7.7%. As Stuart mentioned, we had a strong quarter of loan origination, totaling $1 billion and completing an additional $234 million in add-on funding for previously closed loans. Year-to-date, through Q3 Quarter End, we originated over $3 billion of new commitments and completed a total of $702 million of add-on funding for previously closed loans. Subsequent to Quarter End, we committed an additional $388 million towards new loans, $324 million of which have already been funded. In addition to those closings, we have a robust pipeline of loans, which I expect to close before the end of the year. With respect to risk ratings, the weighted average risk rating of the portfolio at Quarter End was 3.0, unchanged from the previous Quarter End.
Year to date through Q3 quarter end.
Originated over 3 billion of new commitments and completed a total of seven 2 million of funding for previously closed loans.
Subsequent to quarter end, we committed an additional 388 million towards new loans.
$324 million of which has already been funded.
In addition to those clothing.
A robust pipeline of loan, which I expect it to close before the end of the year.
With respect to risk, creating the weighted average risk rating of the portfolio at quarter end was three <unk> unchanged from the previous quarter end.
There were no new assets specific seasonal allowances recorded during the quarter.
And no other movements in ratings across the portfolio.
I was specific seasonal reserve decreased by $7 5 million.
The partial reversal and the associated charge off on the Michigan office loan.
Mentioned earlier.
Our general if he's still alone increased this quarter by $1 million due to origination activity in the portfolio.
Operator: There were no new asset-specific CFIL allowances recorded during the quarter and no other movements in ratings across the portfolio. Our specific CFIL reserve decreased by $7.5 million due to partial reversal and the associated charge-off on the Michigan office loan, as mentioned earlier. Our general CFIL allowance increased this quarter by $1 million due to origination activity in the portfolio. Total CFIL allowance, in percentage points of the loan portfolio amortized cost basis, is up slightly Q2 from 429 basis points to 438 basis points, driven by a slightly lower loan portfolio balance at the end of the quarter compared to the previous Quarter End. We ended the quarter with strong liquidity of $312 million, comprising cash on hand, committed and run capacity on existing facilities, and loan proceeds held by the servicer.
Total fees still allowing in percentage points of the loan portfolio amortized cost basis is up slightly quarter over quarter from four from 429 basis points to 438 basis points, driven by a slightly lower lower principal balance at the end of the quarter.
Compared to the previous quarter end.
We ended the quarter with strong liquidity of $312 million comprising of cash on hand.
Committed undrawn capacity on existing facility and.
And loan proceeds held by the service there.
Our leverage is down quarter over quarter from four one times at June 30 is three eight times at September 30.
We continue to diversify and strengthen our banking relationships with two new bank joining the syndicate. So all of the revolving credit facility, which was upsized by 115 million during the quarter.
Operator: Our leverage is down Q2 from 4.1 times at June 30 to 3.8 times at September 30. We continue to diversify and strengthen our banking relationship, with two new banks joining the syndicate to our revolving credit facility, which was upsized by $115 million during the quarter and extended by three years. Liquidity in the secured borrowing market remains plentiful, and with continued spread tightening, we have been able to generate returns consistent with our historical and target levels. With that, we would like to ask the operator to open the line for questions. Thank you. As a reminder, to ask a question, please press *11 on your telephone and wait for your name to be announced. To withdraw your question, please press *11 again. One moment for questions. Our first question comes from Doug Harter with UBS. You may proceed. Thanks. Thanks for the update on the focused assets.
And extended by three years.
Liquidity in the secured bond market remains plentiful.
And with continued spread tightening we have been able to generate returns consistent with our historical and target levels.
Our leverage is down quarter over quarter from 4.1 times at June 30 to 3.8 times at September 30.
With that we would like to ask the operator to open the line for questions.
Thank you.
As a reminder to ask a question. Please press star one on your telephone and wait for your name to be announced to withdraw. Your question. Please press star one again, one moment for questions.
We continue to diversify and strengthen our banking relationship with 2 new Banks, joining The Syndicate. To our revolving credit facility, which was upsized by 115 million during the quarter and the extended by 3 years.
Our first question comes from Doug Harned with UBS you May proceed.
Liquidity in the secured borrowing, markets remains plentiful. And with continued spread Tiding, we have been able to generate returns consistent with our historical and Target levels.
Thanks.
Yeah.
Thank you thanks for the update on the on the focused assets.
With that, we would like to ask the operator to open the line for questions.
Do you think about the timeline to monetizing.
The book and you.
How should we think about the pacing of of future sales at a 111, 57%.
Thank you as a reminder, to ask a question. Please press star, 1, 1 1 on your telephone and wait for your name, to be announced to withdraw your question. Please press star 1 1 1 again, 1 moment for questions.
Yeah. Thanks, Doug.
Let me take those in reverse because at 111 west 57th we're effectively down to three units at this point.
Our first question comes from Doug Harter with UBS. You may proceed.
Operator: How do you think about the timeline to monetizing The Brooke, and how should we think about the pacing of future sales at 111 W 57th? Yeah, thanks, Doug. Let me take those in reverse because at 111 W 57th, we're effectively down to three units at this point, including what the market knows of as a Quadplex and then another Penthouse. Foot traffic and interest continues to be good at 111 W 57th Street. I would say, given the size of the units we're talking about moving, it's tough to know exactly from a timing perspective, but certainly our expectation in dialogue with the team working on it is that certainly the early part of next year, sometime in the first part of next year, we would hope to be at the finish line on 111 W 57th Street.
Including.
What the market knows as a.
Quadplex and then another penthouse so there's actually.
Foot traffic and interest continues to be good at 111, West 57th Street I would say.
Uh, thanks. Um, you know, as, as you think you, thanks for the update on the, on the focused assets. You know, how do you think about the timeline to monetizing the the brook and, um, you know, how should we think about the, the pacing of, of future sales that, uh, 1 1157?
Given the size of the units, we're talking about moving it's tough to know exactly from a timing perspective, but certainly.
Our expectation in dialogue with the team working on it is that.
No.
The early part of next year sometime in the first part of next year, we would hope to be at the finish line on 111 West 57th Street, I think with respect to.
Foot traffic and interest continues to be good at 111, West 57th Street I would say.
Given the size of the units, we're talking about moving it's tough to know exactly from a timing perspective, but certainly.
Broke if things keep.
Elong is pacing from a lease up perspective, and there's nothing else unforeseen.
Our expectation in dialogue with the team working on it is that.
In the marketplace.
<unk>, we would think about bringing the asset to market.
Yeah.
Certainly the early part of next year sometime in the first part of next year, we would hope to be at the finish line on 111 West 57th Street, I think with respect to.
Yeah call it sometime in the late.
Operator: I think with respect to The Brooke, if things keep along pacing from a lease-up perspective and there's nothing else unforeseen in the marketplace, today, we would think about bringing the asset to market, call it sometime in the late spring, early summer next year, with the hope of closing a transaction sometime late Q3, early Q4. Great. As you think about leverage, what do you think is the right leverage level for this business to be run as you think about the level of redeployment that you can do as you free up capital? I mean, look, for us, it hasn't changed much. The leverage has moved up in the company over time only because we've pivoted out of pure mez loans and more into all senior loans, where you end up roughly same attachment points and generating your ROE that way.
Late spring early summer next year with the hope of closing a transaction sometime.
Broke if things keep.
Late third quarter early fourth quarter.
Along pacing from a lease up perspective, and there is nothing else unforeseen.
Great and then.
In the marketplace.
Yeah.
Today, we would take about bringing the asset to market.
You think about leverage.
What do you think is the right leverage level for this business to be run.
Yes call it some time in the <unk>.
Late spring early summer next year with the hope of closing a transaction some time.
You know as you think about the level of redeployment, but you can do is to free up capital.
Late third quarter early fourth quarter.
Let me look I think for us it hasnt changed much but the leverage has moved up in the company over time only because we've.
Great and then.
Yes.
And how did you think about leverage.
Pivoted out of shore Mezz loans and more into all senior loans, where you end up you know.
What do you think is the right leverage level for this.
This business to be run.
Yeah as you think about the level of redeployment, but you can do is to free up capital.
Roughly same attachment points and generating your ROE that way.
Thank you.
Let me look I think.
For Us we will continue originate senior loans at call. It and then back lever somewhere in the you know.
For us.
It hasnt changed much.
The leverage has moved up in the company over time, only because we've <unk>.
65% to 75% range from a back leverage perspective.
Pivoted out of our Mezz loans and more into all senior loans, where you end up.
That would imply ultimately.
Roughly same attachment points and generating your ROE that way.
Our leverage level.
Operator: For us, we will continue to originate senior loans at, call it, and then back lever somewhere in the 65% to 75% range from a back leverage perspective. That would imply ultimately a leverage level, call it in the mid-3s, but then you've got some corporate leverage as well through the term loan B and the senior secured notes. We're going to run the business around four terms of leverage when we are fully deployed and capital efficient, including return of capital from focus assets. Great. Thank you, Stuart. Sure. Thank you. Our next question comes from Harsh Hemnani with Green Street. You may proceed. Thank you. Thanks for the update on The Brooke and 111 W 57th, both of which seem like first half of 2026, excuse me, and part of it in the second half of 2026.
Call it in the in the mid threes, but then you've got some corporates corporate leverage as well through the term loan b in the senior secured notes.
For Us we will continue originate senior loans at call. It and then back lever somewhere in the <unk>.
So we're going to run the business around around four turns of leverage when we are.
No.
65% to 75% range from a back leverage perspective.
Fully deployed and capital efficient, including return of capital from focused assets.
That would imply ultimately.
Our leverage level.
Call it in the in the mid threes, but then you've got some corporate corporate leverage as well through the term loan b and the senior secured notes. So we're going to run the business around around four turns of leverage when we are.
Alright, Thank you sure.
Sure.
Thank you.
Our next question comes from Harsha <unk> with Green Street, you May proceed.
Thank you.
Thanks for the update on the broke.
The rest would be seven quarters. It seemed like you know first half of.
Fully deployed and capital efficient.
26 excuse me.
<unk> return of capital from focused assets.
And part of it in the second half of 2006 do you have an update.
Great. Thank you Stuart.
Update on the Liberty Center asset.
Sure.
How that is progressing.
Thank you.
Our next question comes from Harsha <unk> with Green Street, you May proceed.
Yes.
The news on Liberty Center, which was actually not a surprise when it happened I guess, we knew it was ultimately going to happen, but we thought we.
Thank you.
Thanks for the update on that.
And that's.
Thats, what <unk> seen.
Seemed like first half of 'twenty.
Thought the market would accept.
2006 excuse me.
Our sales through that which was the parents of the movie Theater at Liberty Center filed bankruptcy.
And part of it in the second half of 2006 do you have any thoughts or update on the Liberty Center asset.
Operator: Do you have any thoughts or update on the Liberty Center asset and how that's progressing? Yeah. The news on Liberty Center, which was actually not a surprise when it happened. I guess we knew it was ultimately going to happen, but we thought the market would accept a sale through that, which was the parent of the movie theater at Liberty Center filed bankruptcy. I think the feedback through the sales process that we were early stages on earlier in this year was that we'll get a better response from the marketplace on the sale side as that gets resolved. At this point, the movie theater is continuing to pay rent, but is, I would say, operating the theater suboptimally. We will let the process play out through the bankruptcy court.
The feedback.
How thats progressing.
Through the sales process that we were early stages on earlier in this year was that.
Yes.
News on Liberty Center, which was actually not a surprise when it happened I guess, we knew it was ultimately going to happen, but we thought.
We will get a better response from the marketplace on the sell side as that gets resolved.
We thought the market would accept.
At this point the movie theater is continuing to pay rent, but as I would say.
Our sales through that which wise.
Parents of the movie Theater at Liberty Center filed bankruptcy I think the feedback.
Operating the theater sub optimally.
Through the sales process that we were early stages on earlier in this year was that we.
We will let the.
Process play out through the bankruptcy court, we are very much involved in the process.
We will get a better response from the marketplace on the sell side as that gets resolved.
And we will determine whether they are going to accept or reject the lease it is clear from.
At this point the movie theater.
Incoming inquiries that there are there are other operators interested in the movie theater space, if it becomes available.
Is continuing to pay rent, but as I would say.
Operating the theater sub optimally.
We will let the.
But at this point, we need to let that process play out and I think we will be in a better position to assess.
Process play out through the bankruptcy court, we are very much involved in the process.
Operator: We are very much involved in the process and we'll determine whether they are going to accept or reject the lease. It is clear from incoming inquiries that there are other operators interested in the movie theater space if it becomes available. At this point, we need to let that process play out, and I think we will be in a better position to assess timing of an exit, probably late Q1, early Q2 of next year. Got it. That's helpful. Maybe on the repayment side, it's been a little lumpy this year, but this quarter was specifically a big step up in repayments. Is there anything particular to point to that that's driving the elevated level of repayments, and do you think that will continue perhaps fourth quarter and moving into early next year? Yeah.
Timing of an exit.
And we will determine whether they are going to accept or reject the lease it is clear from.
Probably late Q1 early Q2 of next year.
Got it that's helpful.
Incoming inquiries that there are there are other operators interested in the movie theater space, if it becomes available.
And then maybe on the repayment side, it's been lumpy this year, but this quarter was specifically.
Big.
But at this point, we need to let that process play out and I think we will be in a better position to assess.
So a big step up in repayments is that correct.
Anything particular to point to that.
Driving the elevated level of repayments and do you think that will continue perhaps fourth quarter and moving into early next year.
Timing of an exit.
Probably late Q1 early Q2 of next year.
Got it that's helpful.
Yes.
We're never you know, we're never going to predict the exact timing and we tend not to spend a lot of time, losing.
And then maybe on the repayment side.
And it can be lumpy this year, but this quarter was specifically.
Sleep over quarterly variations I do think to your question.
<unk>.
A big step up in <unk> is there anything particular to point to that.
Yeah.
Having the elevated level of repayments and do you think that will continue or perhaps fourth quarter and moving into early next year.
Hey.
Broad level repayments are occurring as the capital markets are fully open.
Operator: Look, we're never going to predict the exact timing, and we tend not to spend a lot of time losing sleep over quarterly variations. I do think, to your question, at a broad level, repayments are occurring because the capital markets are fully open. There is the ability for people to access repayment capital, but you're also seeing improved operating performance in a lot of asset classes, and the market has accepted a reset from a valuation perspective. I think a lot of the sort of stasis that we saw in the market in 2022, early 2023, as people were trying to digest elevated interest rates and not really sure where the economy was headed, I would say both in the U.S. and Europe, relevant to our portfolio, there's just better clarity in the market.
There is the ability for people to.
Yes.
Never.
We're never going to predict the exact timing and we tend not to spend a lot of time, losing.
Access repayment capital, but Youre also seeing improved operating performance and a lot of asset classes and the market has accepted a reset from a valuation perspective, so I think a lot of the.
Sleep over quarterly variations I do think to your question.
Yes.
Hey.
Broad level repayments are occurring as the capital markets are fully open.
I'm sort of stasis that we saw in the market in 2022 early 2023 as people are trying to digest elevated interest rates and not really sure where the economy was headed I would say both in the.
There is the ability for people to.
Access repayment capital, but Youre also seeing improved operating performance and a lot of asset classes and the market has accepted a reset from a valuation perspective, so I think a lot of the.
The U S and Europe relevant to our portfolio, there's just better clarity in the market I think a lot of the capital that was sitting on the sidelines, particularly on the equity side.
Sort of stasis that we saw in the market in 2022 early 2023 as people are trying to digest elevated interest rates and not really sure where the economy was headed I would say both in the.
Is biased towards transacting these days so.
I think we will continue to see a healthy pace of repayments across the portfolio.
And I would say.
The U S and Europe relevant to our portfolio, there's just better clarity in the market I think a lot of the capital that was sitting on the sidelines, particularly on the equity side.
It'll be lumpy quarter to quarter, just because you're never quite sure when deals will close.
Operator: I think a lot of the capital that was sitting on the sidelines, particularly on the equity side, is biased towards transacting these days. I think we will continue to see a healthy pace of repayments across the portfolio. I would say. It'll be lumpy quarter to quarter just because you're never quite sure when deals will close. As we look out in terms of projected repayments, the big headline was that repayments are consistent with what we would have expected, and we don't see that changing going forward. Great. Thank you. Sure. Thank you. Our next question comes from Jade Rahmani with KBW. You may proceed. Hi. This is Jason Savchon for Jade. Thanks for taking my question. On 111 W 57th, total exposure was up slightly this quarter to $279 million.
But as we look out in terms of projected repayments. The big headline was that repayments are consistent with what we would've expected and we don't see that changing going forward.
Is biased towards transacting these days so.
I think we will continue to see health.
Healthy pace of repayments across the portfolio.
Okay. Thank you.
Sure.
And I would say.
Thank you. Our next question comes from Jade Rahmani with K VW you May proceed.
It'll be lumpy quarter to quarter, just because you're never quite sure when deals will close.
Hi, This is Jason <unk> on for Jade. Thanks for taking my question.
As we look out in terms of projected repayments. The big headline was that repayments are consistent with what we would've expected and we don't see that changing going forward.
So on one of 11 57 total exposure was up slightly this quarter to $2 $79 million.
I'm, assuming that was due to increased capitalized cost on development spend maybe <unk> on the retail lease is that accurate.
Okay. Thank you.
Sure.
Thank you. Our next question comes from Jade Rahmani with K VW you May proceed.
Yes, yes.
Exactly yes, we had some in connection with the <unk>, we had to pay for some.
Hi, This is Jason <unk> on for Jade. Thanks for taking my question.
I'm going to die.
Got it.
So on one of 11, 7% total exposure was up slightly this quarter to $2 $79 million I'm, assuming that was due to increased capitalized cost on development spend maybe <unk> retail lease is that accurate.
Yeah.
I would also say I'm sorry, Scott.
Operator: I'm assuming that was due to increased capitalized cost on development spend, maybe TIs on the retail lease. Is that accurate? Yes. Yes, Jason, it's accurate. In connection with the bonds lease, we had to pay for some ongoing TI. Got it. I think we didn't have any. I would also say, I'm sorry, Scott. Jason, the other thing I'd say, it's consistent with the underwriting we did at the time we took the reserve on 111 W 57th. I would say it's consistent with expectations. I'm sorry, Scott. Go ahead. Yeah. I was just going to say we didn't have any of the contracts closed in the quarter. I think you saw in our release that we already have three contracts closed that'll reduce the balance.
Say its consistent with.
The underwriting we did at the time, we took the.
Reserve on 111 West 57th So I would say, it's consistent with expectations I'm sorry, Scott go ahead, yes.
Yes.
Yes, Jason that's accurate, yes, we had some in connection with the <unk>, we had to pay for some.
I was just saying we didn't have any of the any of the contracts closed in the quarter. So I think you saw in our release that we had already have three three.
Going to your line.
Got it.
Three contracts closed so that will reduce the balance and then Stuart was saying that theres three unsold units with the Royals or three more units that are under contract that we expect to close.
I would also say I'm, sorry, Scott, Yes, I would say it's consistent with.
The underwriting we did at the time, we took the.
During the quarter. So there should be six units at least closing this quarter paying down our balance.
Reserve on 111 West 57th So I would say, it's consistent with expectations I'm sorry, Scott go ahead, yes.
Okay, that's great.
I was just going to saying we didn't have any of the any of the contracts closed in the quarter. So I think you saw in our release that we had already have three three.
And then on Brooklyn multifamily.
What's the difference between the debt listed in the slide deck at $330 million in capitalized financing and construction costs in the 10-Q it at three.
Three contracts closed that will reduce the balance and then Stuart was saying that theres three unsold units, but there also are three more units that are under contract that we expect to close.
Operator: Stuart was saying that there's three unsold units, but there also are three more units that are under contract that we expect to close the remainder of the quarter. There should be six units at least closing this quarter, paying down our balance. Okay. That's great. On Brooklyn multifamily, what's the difference between the debt listed in the slide deck at $330 million and capitalized financing and construction costs in the 10Q at $330 in the slide deck and $393 in the 10Q? Anastasia, do you want to handle that now or just get back after the call? Yeah. This is Anastasia. I will take a look at the math here. I'll get back to you after the call. All right. Thank you. On the two hotels, the Mayflower and the Atlanta hotels, any update there would be helpful. I think on the Mayflower, the hotel continues to perform well.
393, sorry, $3 30 in the slide deck and $3 93 in the 10-Q.
During the quarter, so that should be six units at least closing this quarter paying down our balance.
On the stage are you on a handle that now or just get back after the call.
Oh, that's great.
And then on Brooklyn multifamily.
I will take a look I cannot.
What's the difference between the debt listed in the slide deck at $330 million.
And back to you after the call.
Alright, thank you.
And then just on the two hotels the Mayflower in the Atlanta hotels them any update there would be helpful.
Capitalized financing and construction costs in the 10-Q it at three.
393, sorry, $3 30 in the slide deck and 393 in the 10-Q.
I mean, I think on the Mayflower The hotel continues to perform well obviously there is some seasonality in the numbers.
Anastasia you want to handle that now or just get back after the call.
Which sort of always impacts what occurs in Q3, but overall.
Yeah. This is Dave.
We'll take a look at.
From an NOI perspective, particularly relative to basis, the hotel is performing quite well and.
Ken back to you after the call.
Alright, thank you.
And then just on the two hotels the Mayflower in the Atlanta Hotel Zoe any update there would be helpful.
We are now stepping into.
Our focus on optimizing the expense side at the hotel, but we continue to feel.
I mean, I think on the May flower that hotel continues to perform well obviously there is some seasonality in the numbers.
Operator: Obviously, there's some seasonality in the numbers, which sort of always impacts what occurs in Q3. Overall, from an NOI perspective, particularly relative to basis, the hotel is performing quite well. We are now stepping into a focus on optimizing the expense side at the hotel, but we continue to feel. Quite positive on performance of the hotel and just think there's some more net cash flow uplift that we can. Thank you. Hotel to a more stabilized level. All right. Thank you. Thank you. Our next question comes from John Nicodemus with BTIG. You may proceed. Hello. Good morning, everyone, and thanks for taking my question. As Harsh mentioned, it was definitely a high repayment quarter, but it sounds like originations are a full go into the end of the year, which is exciting.
I'm quite positive on performance of the hotel and just think there is some more.
Which sort of always impacts what occurs in Q3, but overall.
Net cash flow uplift that we can.
From an NOI perspective, particularly relative to basis, the hotel is performing quite well and.
Thank you.
Our next question comes from Jon Nicodemus with BTG you May proceed.
We are now stepping into.
Our focus on optimizing the expense side at the hotel, but we continue to feel.
Hello, Good morning, everyone and thanks for taking my question.
As harsh mentioned it was definitely a high repayment quarter, but it sounds like originations or a full go into the end of the year, which is exciting.
I'm quite positive on performance of the hotel and just think there are some more.
Net cash flow uplift that we can.
Honestly. This is all can fluctuate on a quarter by quarter basis, but how do you envision the size of the loan portfolio trending you know now.
Not just in the next quarter, but kind of as we get further into <unk>.
Middle of 2026, and maybe even into next year do you have any insight on that thanks.
Thank you hotel to our stabilized level.
I mean, where the growth in the loan portfolio is going to come from John is right to the extent, we are able to take.
Yes.
Alright, thank you.
Unlevered capital right. If you think about repayments on 111, west 57th Street or ultimately selling.
Thank you.
Our next question comes from Jon Nicodemus with BTG you May proceed.
Liberty Center, right Youre going to take Unlevered cap at all and then you know.
Hello, Good morning, everyone and thanks for taking my question.
As harsh mentioned it was definitely a high repayment quarter, but it sounds like originations or a full go into the end of the year, which is exciting.
Deploy it and lever it into asset so you'll see some.
Portfolio growth.
Operator: Obviously, this all can fluctuate on a quarter-by-quarter basis, but how do you envision the size of the loan portfolio trending, not just in the next quarter, but kind of as we get further into middle of 2026 and maybe even the end of next year, if you have any insight on that? Thanks. I mean, where the growth in the loan portfolio is going to come from, John, is to the extent we are able to take unlevered capital, right? If you think about repayments on 111 W 57th Street or ultimately selling Liberty Center, right, you're going to take unlevered capital and then deploy it and lever it into assets. You'll see some portfolio growth as we bring back what we would call the focus asset capital. You'll see less impact if and when we ultimately sell The Brooke because that is levered as a construction deal already.
As we bring back.
Obviously this is all can fluctuate on a quarter by quarter basis, but how do you envision the size of the loan portfolio trending you know not just in the next quarter, but kind of as we get further into <unk>.
But we would call the focus asset capital Youll see less impact.
If and when we ultimately sell the breadth does that.
As levered as a.
Middle of 2026, and maybe even into next year do you have any insight on that thanks.
As a construction deal already will be able to use more leverage against the senior first mortgage then you can against a.
I mean, where the growth in the loan portfolio is going to come from John is right to the extent, we are able to take.
Construction deal so youll see some pick up in asset level, but it won't be as dramatic as just assuming all of the capital is coming back to us, but that's what's really going to drive.
Unlevered capital right. If you think about repayments on 111, west 57th Street or ultimately selling.
Liberty Center, right Youre going to take Unlevered cap at all and then.
Portfolio of growth going forward is taking focus assets, which for the most part are.
Deploy it and lever into asset so you'll see some.
Unlevered or under Levered and deploying them into senior loans, where we'll use.
Portfolio growth.
As we bring back.
What unquote full leverage Carmine response to Doug's question earlier in the conference call.
What we would call the focus asset capital Youll see less impact.
If and when we ultimately sell the breadth is that.
Great really helpful. Stuart Thank you.
As levered as a.
And then other one for me solve the team originated two sizable loans on upscale hotels during the quarter.
As a construction deal already will be able to use more leverage against the senior first mortgage then you can against a.
Operator: We'll be able to use more leverage against a senior-first mortgage than you can against a construction deal. You'll see some pickup in asset level, but it won't be as dramatic as just assuming all of the capital is coming back to us. That's what's really going to drive portfolio growth going forward, is taking focus assets, which for the most part are unlevered or underlevered, and deploying them into senior loans where we'll use "full leverage" per my response to Doug's question earlier in the conference call. Great. Really helpful, Stuart. Thank you. The other one for me, saw the team originate two sizable loans on upscale hotels during the quarter. Was just curious if there's something about the hospitality sector that you're finding more attractive at this time, or were these more just unique opportunities in New York and San Diego? Thanks. Scott, do you want to comment?
Curious if theres something about the hospitality sector that you're finding more attractive at this time or are these more just unique opportunities in New York and San Diego. Thanks.
At construction deal so you'll see some pickup in asset level, but it won't be as dramatic as just assuming all of the capital is coming back to us, but thats whats really going to drive.
Scott do you want to comment Yeah, I mean, I would say like we've always been active in the hotel front.
Portfolio of growth going forward is taking focused assets, which for the most part are.
Both in the U S and Europe and happen to like these deals just given size and in place cash flow one.
Unlevered or under Levered and deploying them into senior loans, where we'll use.
One of the deals we partner with somebody and there was a man.
It is behind US we were able to structure, a very low leverage deal and then one in the New York City. It was an asset we were familiar with them and the sponsorship group was an acquisition financing so nothing special.
What unquote full leverage Carmine response to Doug's question earlier in the conference call.
Great really helpful. Stuart Thank you.
And then other one for me solve the team originated two sizable loans on upscale hotels during the quarter.
I think hotels will always have a part of the portfolio and think we've done a bunch of repayments and hotel. So we thought it made sense to have these two deals.
Just curious if theres something about the hospitality sector that youre finding more attractive at this time or are these more just unique opportunities in New York and San Diego. Thanks.
Awesome. Thanks, so much Scott I appreciate the time.
Thank you and as a reminder to ask a question. Please press star one on your telephone. Our next question comes from Rick Shane with Jpmorgan you May proceed.
Operator: Yeah. I mean, I would say we've always been active in the hotel front, both in the U.S. and Europe, and happen to like these deals just given size and in-place cash flow. One of the deals, we partnered with someone, and there's a mezz behind us. We were able to structure a very low-leverage deal. Then one in New York City, it was an asset we were familiar with in a sponsorship group. It was acquisition financing. Nothing special. I think hotels will always have a part of the portfolio, and I think we've gotten a bunch of repayments in hotels. We thought it made sense to add these two deals. Awesome. Thanks so much, Scott, and appreciate the time. Thank you. As a reminder, to ask a question, please press star 11 on your telephone. Our next question comes from Rick Shane with JPMorgan. You may proceed.
Scott do you want to comment.
Look we've always been active in the hotel front.
Both in the U S and Europe and happen to like do you feel just given size and in place cash flow one of them.
Hey, this is AJ out for it.
So it seems like office trends are continuing to improve I was just wondering if you can give us an update on what youre seeing in your office portfolio right now.
Deals, we partner with somebody and Theres, a mezz behind US we were able to structure a very low leverage deal and then one in the New York City. It was an asset we are familiar with and our sponsorship group this acquisition financing.
Yes, Scott do you want me to go you want to go.
Yeah look I mean, I think look it's still a very much city by city with offices I mean, I think we're fortunate.
Nothing special.
I think hotels will always have a part of the portfolio and think we've got a bunch of repayments and hotel. So we thought it made sense to add these two deals.
Where our exposure generally is but I would say certainly.
So we're getting from from the landlord people are back in the office more and that's really across the board clearly in New York I think there may be even higher than pre COVID-19.
Awesome. Thanks, so much Scott I appreciate the time.
Thank you and as a reminder to ask a question. Please press star one on your telephone. Our next question comes from Rick Shane with Jpmorgan you May proceed.
Lots of positive.
Leasing momentum.
Again, New York and London in particular.
Chicago, where we do have some exposure.
Operator: Hey, this is AJ on for Rick. It seems like office trends are continuing to improve. I was just wondering if you can give us an update on what you're seeing in your office portfolio right now. Yeah. Scott, do you want me to go? You want to go? Yeah. Look, I think it's still very much city by city with offices. I think we're fortunate where our exposure generally is. I would say, certainly, in the stats that we're getting from the landlords, people are back in the office more, and that's really across the board. Clearly, New York, I think they're maybe even higher than pre-COVID. Lots of positive leasing momentum. Again, New York and London in particular. Chicago, where we do have some exposure, I would say it's again asset by asset.
Hey, this is AJ on for Rick.
It's.
I would say, it's kind of an asset by asset we happen to have a loan on one of the newest buildings in Chicago, that's doing great. We have a loan on an older building that is seeing some positive leasing and not as much as the newer built which I think again as consistent and in other markets.
It seems like office trends or contingent.
Was just wondering if you can give us an update on what youre seeing in your office portfolio right now.
Yes, Scott do you want me to go you undergo.
Look I mean, I think look it's still a very much city by city.
I mean, I think we're fortunate.
So I think we're pleased and I think overall, so we're seeing more capital market activity Youre seeing certainly the financing of office deals.
Where our exposure generally is but I would say certainly.
And just as they were getting from from the landlord people are back in the office more and that's really across the board clearly in New York I think there may be even higher than pre COVID-19.
Is that across the board both stabilized fuels as well as lease up and then you are starting to see more more transaction activity.
Okay.
That's a positive.
Super helpful. Thank you and then just one more another one on repayments.
Leasing momentum.
Again, New York and London in particular.
So now that rates are finally, starting to come down could you see a bit of a tick up in repayment rates, especially if some of those earlier COVID-19 are going to do that.
Chicago, where we do have some exposure.
It's.
Operator: We happen to have a loan on one of the newest buildings in Chicago, and that's doing great. We have a loan on an older building that is seeing some positive leasing, not as much as the newer build, which I think is consistent in other markets. I think we're pleased. Overall, we're seeing more capital market activity. You're seeing certainly that the financing of office deals is back across the board, both stabilized deals as well as lease-up. You are starting to see more transaction activity. Super helpful. Thank you. Then just one more, another one on repayments. Now that rates are finally starting to come down, could you see a bit of a tick up in repayment rates, especially for some of those earlier COVID-era vendors that have been waiting for lower rates for so long? Yeah.
I would say, it's again asset by asset we happen to have a loan on one of the newest buildings in Chicago, that's doing great. We have a loan on an older building that is seeing some positive leasing not as much as the newer build which I think again as consistent in other markets.
Waiting for lower rates for so long.
Yeah, I mean, I think as we look at our portfolio.
Consistent with <unk>.
Scott I was just there.
So I think we're pleased and I think overall, so we're seeing more capital market activity Youre seeing certainly the financing of office deals.
There's a bunch of our stuff is actually being sold.
People have achieved their business plan and they are selling it and we're getting repaid other deals are being refinanced and weather.
Is that across the board both stabilized fuels as well as lease up and then you are starting to see more more transaction activity.
Pulling out money or just again, the Malone loans coming due so I don't really see it as a trend where someone had really high expensive debt from.
Okay.
Super helpful. Thank you and then just one more another one on repayments.
From Covid or pre Covid I think is just normal these are floating rate loans with.
Now that rates are finally, starting to come down could you see a.
A bit of a tick up in repayment rates, especially for some of those earlier Covid, Eric engineers have been waiting for lower rates for so long.
Few years of call protection and when we do alone we kind of expect it to be out two or three years and I. Just think people are the markets are open and where they want to refinance or sell they are doing that now.
Operator: I think as we look at our portfolio, consistent with all real estate, right? Yeah. Go ahead, Scott. Go for it. I was just going to say a bunch of our stuff is actually being sold. People have achieved their business plan, and they're selling it, and we're getting repaid. Other deals are being refinanced, whether pulling out money or just, again, the loans coming due. I don't really see it as a trend where someone had really high expensive debt from COVID or pre-COVID. I think it's just normal. These are floating-rate loans with a few years of call protection. When we do a loan, we kind of expect it to be out two, three years. I just think people are, the markets are open, and where they want to refinance or sell, they're doing that now. Thank you very much. That's all for me. Thank you.
Yes, I mean, I think as we look at our portfolio.
Yep. Thank you very much that's all for me.
Consistent with <unk>.
Thank you I would now like to turn the call back over to Stuart Rothstein for any closing remarks.
Yes, Scott I would just say.
There is a bunch of our staff is actually being sold.
No closing remarks as always appreciate everybody's participation and if you have questions. After the fact myself Hillary Anastasia we are always reachable and available. Thank you all.
So people have achieved their business plan and they are selling and we are getting repaid other deals are being refinanced and weather.
Pulling out money or just again the loan loans coming due so I don't really see it as a trend where someone had really high expensive debt.
Thank you. This concludes the conference. Thank you for your participation you may now disconnect.
From Covid or pre Covid I think it's just normal these are floating rate loans with a few years of call protection and when we do alone we kind of expect it to be out two or three years and I. Just think people are the markets are open and where they want to refinance or sell they're doing that now.
Yes. Thank you very much that's all for me.
Operator: I would now like to turn the call back over to Stuart Rothstein for any closing remarks. No closing remarks. As always, appreciate everybody's participation. If you have questions after the fact, myself, Hillary, Anastasia, we are always reachable and available. Thank you all. Thank you. This concludes the conference. Thank you for your participation. You may now disconnect.
Thank you I would now like to turn the call back over to Stuart Rothstein for any closing remarks.
No closing remarks as always appreciate everybody's participation and if you have questions. After the fact myself Hillary Anastasia we are always reachable and available. Thank you all.
Thank you. This concludes the conference. Thank you for your participation you may now disconnect.
Okay.
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Okay.
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Okay.