BLACKSTONE MORTGAGE TRUST, INC.

1. ORGANIZATION

References herein to “Blackstone Mortgage Trust,” “Company,” “we,” “us” or “our” refer to Blackstone Mortgage Trust,

Inc., a Maryland corporation, and its subsidiaries unless the context specifically requires otherwise.

Blackstone Mortgage Trust is a real estate finance company that originates, acquires, and manages senior loans and other

debt or credit-oriented investments collateralized by or relating to commercial real estate in North America, Europe, and

Australia. Our portfolio is composed primarily of senior loans secured by high-quality, institutional assets located in major

markets, and sponsored by experienced, well-capitalized real estate investment owners and operators. We finance our

investments in a variety of ways, including borrowing under secured credit facilities, issuing collateralized loan obligations,

or CLOs, other securitization transactions, syndicating senior loans and/or participations, and other forms of asset-level

financing, depending on our view of the most prudent financing option available for each of our investments. We are

externally managed by BXMT Advisors L.L.C., or our Manager, a subsidiary of Blackstone Inc., or Blackstone, and are a

real estate investment trust, or REIT, traded on the New York Stock Exchange, or NYSE, under the symbol “BXMT.” Our

principal executive offices are located at 345 Park Avenue, New York, New York 10154.

We conduct our operations as a REIT for U.S. federal income tax purposes. We generally will not be subject to U.S. federal

income taxes on our taxable income to the extent that we annually distribute all of our net taxable income to stockholders

and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an

exclusion from registration under the Investment Company Act of 1940, as amended. We are organized as a holding

company and conduct our business primarily through our various subsidiaries.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting

principles generally accepted in the United States of America, or GAAP, for interim financial information and the

instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The consolidated financial statements, including the notes

thereto, are unaudited and exclude some of the disclosures required in audited financial statements. We believe we have

made all necessary adjustments, consisting of only normal recurring items, so that the consolidated financial statements are

presented fairly and that estimates made in preparing our consolidated financial statements are reasonable and prudent. The

operating results presented for interim periods are not necessarily indicative of the results that may be expected for any

other interim period or for the entire year. The accompanying unaudited consolidated interim financial statements should

be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for

the fiscal year ended December 31, 2025 filed with the Securities and Exchange Commission, or the SEC.

Basis of Presentation

The accompanying consolidated financial statem ents have been prepared in accordance with GAAP, and include, on a

consolidated basis, our accounts, the accounts of our wholly-owned subsidiaries, majority-owned subsidiaries, and variable

interest entities, or VIEs, of which we are the primary beneficiary. All intercompany balances and transactions have been

eliminated in consolidation.

Certain prior period amounts have been reclassified to conform to the current period presentation, including changes to the

presentation of certain income and expense captions and loans receivable disclosures.

Principles of Consolidation

We consolidate all entities that we control through either majority ownership or voting rights. In addition, we consolidate

all VIEs of which we are considered the primary beneficiary. VIEs are defined as entities in which equity investors (i) do

not have an interest with the characteristics of a controlling financial interest and/or (ii) do not have sufficient equity at risk

for the entity to finance its activities without additional subordinated financial support from other parties. The entity that

consolidates a VIE is known as its primary beneficiary and is generally the entity with (i) the power to direct the activities

that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the

obligation to absorb losses of the VIE that could be significant to the VIE. Entities that do not qualify as VIEs are generally

considered voting interest entities, or VOEs, and are evaluated for consolidation under the voting interest model. VOEs are

consolidated when we control the entity through a majority voting interest or other means.

For consolidated entities, the non-controlling partner’s share of the assets, liabilities, and operations of each joint venture is

included in non-controlling interests as a component of total equity. The non-controlling partner’s interest is generally

computed as the joint venture partner’s ownership percentage.

When the requirements for consolidation are not met and we have significant influence over the operations of the entity, the

investment is accounted for under the equity method of accounting. Investments in unconsolidated entities for which we

have not elected the fair value option, or FVO, are initially recorded at cost and subsequently adjusted for our pro rata share

of net income, contributions and distributions. When we elect the FVO, we record our share of the net asset value of the

entity and any related unrealized gains and losses.

We review our investments in unconsolidated entities for impairment each quarter or when there is an event or change in

circumstances that indicates a decrease in value. If there is a decrease in value due to a series of operating losses or other

factors, the investment is evaluated to determine if the loss in value is considered other than temporary. Although a current

fair value below the carrying value of the investment is an indicator of impairment, we will only recognize an impairment

if the loss in value is determined to be an other than temporary impairment. If an impairment is determined to be other than

temporary, we will record an impairment charge sufficient to reduce the investment’s carrying value to its fair value, which

would result in a new cost basis. This new cost basis will be used for future periods when recording subsequent income or

loss and cannot be written up to a higher value as a result of increases in fair value.

In 2017, we entered into a joint venture with Walker & Dunlop Inc., or Walker & Dunlop, to originate, hold, and finance

multifamily bridge loans, which we refer to as our Multifamily Joint Venture. Pursuant to the terms of the agreements

governing the joint venture, Walker & Dunlop contributed 15% of the venture’s equity capital and we contributed 85%.

We consolidate our Multifamily Joint Venture as we have a controlling financial interest. The non-controlling interests

included on our consolidated balance sheets represent the equity interests in our Multifamily Joint Venture that are owned

by Walker & Dunlop. A portion of our Multifamily Joint Venture’s consolidated equity and results of operations are

allocated to these non-controlling interests based on Walker & Dunlop’s pro rata ownership of our Multifamily Joint

Venture.

In 2024, we entered into a joint venture with a Blackstone-advised investment vehicle to invest in triple net lease

properties, which we refer to as our Net Lease Joint Venture. Our aggregate ownership interest in our Net Lease Joint

Venture was 75% as of September 30, 2026. We do not consolidate our Net Lease Joint Venture as we do not have a

controlling financial interest. Our investment in our Net Lease Joint Venture is accounted for under the equity method, and

is recorded ininvestments in unconsolidated entities on our consolidated balance sheets, and our pro rata share of income

(loss) is recorded inincome (loss) from unconsolidated entities on our consolidated statements of operations.

In 2025, we entered into a joint venture with a Blackstone-advised investment vehicle to acquire portfolios of performing

commercial mortgage loans, which we refer to as our Bank Loan Portfolio Joint Venture. During 2025, our Bank Loan

Portfolio Joint Venture acquiredtwo portfolios of performing commercial mortgage loans. Our aggregate ownership

interest in our Bank Loan Portfolio Joint Venture was 35% as of September 30, 2026. We do not consolidate our Bank

Loan Portfolio Joint Venture as we do not have a controlling financial interest. Our investment in our Bank Loan Portfolio

Joint Venture is accounted for using the FVO, and is recorded ininvestments in unconsolidated entities on our consolidated

balance sheets, and our pro rata share of any unrealized gains and losses is recorded inincome (loss) from unconsolidated

entities on our consolidated statements of operations.

In the second quarter of 2026, we entered into a joint venture with an unaffiliated third party, alongside a Blackstone-

advised investment vehicle, to originate, acquire, and fund construction loans collateralized by single family homes located

in various markets across the United States, which we refer to as our Homebuilder Finance Joint Venture. Our aggregate

ownership interest in our Homebuilder Finance Joint Venture was 45% as of September 30, 2026. We do not consolidate

our Homebuilder Finance Joint Venture as we do not have a controlling financial interest. Our investment in our

Homebuilder Finance Joint Venture is accounted for using the FVO, and is recorded ininvestments in unconsolidated

entities on our consolidated balance sheets, and our pro rata share of any unrealized gains and losses is recorded inincome

(loss) from unconsolidated entities on our consolidated statements of operations.

Use of Estimates

The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and

assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of

the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting

period. Actual results may ultimately differ materially from those estimates.

Interest income from our loans receivable portfolio is recognized over the life of each loan using the effective interest

method and is recorded on the accrual basis. Recognition of fees, premiums, and discounts associated with these

investments is deferred and recorded over the term of the loan as an adjustment to yield. Income accrual is generally

suspended for loans at the earlier of the date at which payments become 90 days past due or when, in our opinion, recovery

of income and principal becomes doubtful. Interest received is then recorded as income or as a reduction in the amortized

cost basis, based on the specific facts and circumstances, until accrual is resumed when the loan becomes contractually

currentand performance is demonstrated to be resumed. In addition, for loans we originate, the related origination expenses

are deferred and recognized as a reduction to interest income; however, expenses related to loans we acquire are included

in general and administrative expenses as incurred.

The sources of revenue from our owned real estate assets, which are included in revenue from owned real estate on our

consolidated statements of operations, and the related revenue recognition policies are as follows:

Rental income primarily consists of base rent income arising from tenant leases at our office and multifamily properties.

We determine if an arrangement is a lease at contract inception, which is subject to the provisions of Financial Accounting

Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 842 “Leases.” Base rent is recognized on a

straight-line basis over the life of the lease, including any rent steps or abatement provisions. We begin to recognize

revenue upon the acquisition of the related property or when a tenant takes possession of the leased space.

Other operating income primarily consists of income from our hospitality properties and tenant reimbursement income.

Revenue from our hospitality properties consists primarily of room revenue and food and beverage revenue. Room revenue

is recognized when the related room is occupied and other hospitality revenue is recognized when the service is rendered.

Tenant reimbursement income primarily consists of amounts due from tenants for costs related to common area

maintenance, real estate taxes, and other recoverable costs included in lease agreements.

We evaluate the collectability of receivables related to rental revenue on an individual lease basis and exercise judgment in

assessing collectability considering the length of time a receivable has been outstanding, tenant creditworthiness, payment

history, available information about the financial condition of the tenant, and current economic trends, among other factors.

Tenant receivables that are deemed uncollectible are recognized as a reduction to rental revenue.

Cash and Cash Equivalents

Cash and cash equivalents represent cash held in banks and liquid investments with original maturities of three months or

less. We may have bank balances in excess of federally insured amounts; however, we deposit our cash and cash

equivalents with high credit-quality institutions to minimize credit risk exposure. We have not experienced, and do not

expect, any losses on our cash or cash equivalents. As of both September 30, 2026 and December 31, 2025, we had no

restricted cash on our consolidated balance sheets.

Loans Receivable, Held-For-Investment

We originate and purchase commercial real estate debt and related instruments generally to be held as long-term

investments at amortized cost.

Current Expected Credit Losses Reserve

The current expected credit loss, or CECL, reserve required under the ASC Topic 326 “Financial Instruments – Credit

Losses,” or ASC 326, reflects our current estimate of potential credit losses related to our loans and notes receivable

included in our consolidated balance sheets. Changes to the CECL reserves are recognized through net income on our

consolidated statements of operations. While ASC 326 does not require any particular method for determining the CECL

reserves, it does specify the reserves should be based on relevant information about past events, including historical loss

experience, current portfolio and market conditions, and reasonable and supportable forecasts for the duration of each

respective loan. In addition, other than a few narrow exceptions, ASC 326 requires that all financial instruments subject to

the CECL model have some amount of loss reserve to reflect the principle underlying the CECL model that all loans and

similar assets have some inherent risk of loss, regardless of credit quality, subordinate capital, or other mitigating factors.

We estimate our CECL reserves primarily using the Weighted-Average Remaining Maturity, or WARM method, which

has been identified as an acceptable loss-rate method for estimating CECL reserves in FASB Staff Q&A Topic 326, No. 1.

The WARM method requires us to reference historical loan loss data across a comparable data set and apply such loss rate

to each of our loans over their expected remaining term, taking into consideration expected economic conditions over the

relevant time frame. We apply the WARM method for the majority of our loan portfolio, which consists of loans that share

similar risk characteristics. In certain instances, for loans with unique risk characteristics, we may instead use a probability-

weighted model that considers the likelihood of default and expected loss given default for each such individual loan.

Application of the WARM method to estimate CECL reserves requires judgment, including (i) the appropriate historical

loan loss reference data, (ii) the expected timing and amount of future loan fundings and repayments, and (iii) the current

credit quality of our portfolio and our expectations of performance and market conditions over the relevant time period. To

estimate the historical loan losses relevant to our portfolio, we have augmented our historical loan performance with market

loan loss data licensed from Trepp LLC. This database includes commercial mortgage-backed securities, or CMBS, issued

since January 1, 1999 through August 31, 2026. Within this database, we focused our historical loss reference calculations

on the most relevant subset of available CMBS data, which we determined based on loan metrics that are most comparable

to our loan portfolio including asset type, geography, and origination loan-to-value, or LTV. We believe this CMBS data,

which includes month-over-month loan and property performance, is the most relevant, available, and comparable dataset

to our portfolio.

Our loans typically include commitments to fund incremental proceeds to our borrowers over the life of the loan. These

future funding commitments are also subject to the CECL model. The CECL reserve related to future loan fundings is

recorded as a component of other liabilities on our consolidated balance sheets. This CECL reserve is estimated using the

same process outlined above for our outstanding loan balances, and changes in this component of the CECL reserve will

similarly impact our consolidated net income. For both the funded and unfunded portions of our loans, we consider our

internal risk rating of each loan as the primary credit quality indicator underlying our assessment.

The CECL reserves are measured on a collective basis wherever similar risk characteristics exist within a pool of similar

assets. We have identified the following pools and measure the reserve for credit losses using the following methods:

•U.S. Loans: WARM method that incorporates a subset of historical loss data, expected weighted-average

remaining maturity of our loan pool, and an economic view.

•Non-U.S. Loans: WARM method that incorporates a subset of historical loss data, expected weighted-average

remaining maturity of our loan pool, and an economic view.

•Unique Loans: a probability of default and loss given default model, assessed on an individual basis. During the

three months ended June 30, 2026, we reassessed the pooling of certain loans previously classified within our

Unique Loans pool. Based on our reassessment, we determined that these loans share risk characteristics

materially similar to loans in our U.S. Loans and Non-U.S. Loans pools, as evaluated under our internal risk rating

framework. Accordingly, consistent with ASC 326, which requires assets with similar risk characteristics to be

evaluated on a collective basis wherever similar risk characteristics exist within a pool of similar assets, we have

reclassified these loans into our U.S. Loans and Non-U.S. Loans pools, as applicable based on the geographic

location of the underlying collateral. This reclassification did not have a material impact on our total CECL

reserves as of September 30, 2026.

•Impaired Loans: Impairment is indicated when it is deemed probable that we will not be able to collect all

amounts due to us pursuant to the contractual terms of the loan. Determining that a loan is impaired requires

significant judgment from management and is based on several factors including (i) the underlying collateral

performance, (ii) discussions with the borrower, (iii) borrower events of default, and (iv) other facts that impact

the borrower’s ability to pay the contractual amounts due under the terms of the loan. If a loan is determined to be

impaired, we record the impairment as a component of our CECL reserves by applying the practical expedient for

collateral dependent loans. The CECL reserves are assessed on an individual basis for these loans by comparing

the estimated fair value of the underlying collateral to the book value of the respective loan. These valuations

require significant judgments, which include assumptions regarding capitalization rates, discount rates, leasing,

actions of other lenders, and other factors deemed relevant by us. Actual losses, if any, could ultimately differ

materially from these estimates. We only expect to charge off the impairment losses in our consolidated financial

statements prepared in accordance with GAAP if and when such amounts are deemed non-recoverable. This is

generally at the time a loan is repaid or foreclosed, or the underlying collateral assets are otherwise consolidated.

However, non-recoverability may also be concluded if, in our determination, it is nearly certain that all amounts

due will not be collected.

Contractual Term and Unfunded Loan Commitments

Expected credit losses are estimated over the contractual term of each loan, adjusted for expected repayments. As part of

our quarterly review of our loan portfolio, we assess the expected repayment date of each loan, which is used to determine

the contractual term for purposes of computing our CECL reserves.

Additionally, the expected credit losses over the contractual period of our loans are subject to the obligation to extend

credit through our unfunded loan commitments. The CECL reserve for unfunded loan commitments is adjusted quarterly,

as we consider the expected timing of future funding obligations over the estimated life of the loan. The considerations in

estimating our CECL reserve for unfunded loan commitments are similar to those used for the related outstanding loans

receivable.

Credit Quality Indicator

Our risk rating is our primary credit quality indicator in assessing our current expected credit loss reserve. We perform a

quarterly risk review of our portfolio of loans, and assign each loan a risk rating based on a variety of factors, including,

without limitation, origination LTV, debt yield, property type, geographic and local market dynamics, physical condition,

cash flow volatility, leasing and tenant profile, loan structure and exit plan, and project sponsorship. Based on a 5-point

scale, our loans are rated “1” through “5,” from less risk to greater risk, relative to our loan portfolio in the aggregate,

which ratings are defined as follows:

1 -Very Low Risk

2 -Low Risk

3 -Medium Risk

4 -High Risk/Potential for Loss: A loan that has a risk of realizing a principal loss.

5 -Impaired/Loss Likely: A loan that has a very high risk of realizing a principal loss or has otherwise incurred a

principal loss.

Estimation of Economic Conditions

In addition to the WARM method computations and probability-weighted models described above, our CECL reserves are

also adjusted to reflect our estimation of the current and future economic conditions that impact the performance of the

commercial real estate assets securing our loans. These estimations include unemployment rates, interest rates, expectations

of inflation and/or recession, and other macroeconomic factors impacting the likelihood and magnitude of potential credit

losses for our loans during their anticipated term. In addition to the CMBS data we have licensed from Trepp LLC, we

have also licensed certain macroeconomic financial forecasts to inform our view of the potential future impact that broader

economic conditions may have on our loan portfolio’s performance. We generally also incorporate information from other

sources, including information and opinions available to our Manager, to further inform these estimations. This process

requires significant judgments about future events that, while based on the information available to us as of the balance

sheet date, are ultimately indeterminate and the actual economic condition impacting our portfolio could vary significantly

from the estimates we made as of September 30, 2026.

Loans Receivable, Held-For-Sale

Loans that are under contract to be sold or otherwise disposed of in the foreseeable future are classified as held-for-sale and

carried at the lower of amortized cost or fair value. Any difference between amortized cost and fair value is recognized

through valuation adjustment on loans receivable, held-for-sale in our consolidated statements of operations.

We may assume legal title, physical possession, or control of the collateral underlying a loan through a foreclosure, a deed-

in-lieu of foreclosure transaction, or a loan modification in which we receive an equity interest in and/or control over

decision-making at the property, resulting in us consolidating the real estate assets as VIEs. These real estate acquisitions

are classified as owned real estate on our consolidated balance sheet and are initially recognized at fair value on the

acquisition date in accordance with the ASC Topic 805, “Business Combinations,” or ASC 805.

Upon acquisition of owned real estate assets, we assess the fair value of acquired tangible and intangible assets, which may

include land, buildings, tenant improvements, “above-market” and “below-market” leases, acquired in-place leases, other

identified intangible assets and assumed liabilities, as applicable, and allocate the fair value to the acquired assets and

assumed liabilities. We assess and consider fair value based on estimated cash flow projections that utilize discount and/or

capitalization rates that we deem appropriate, as well as other available market information. Estimates of future cash flows

are based on a number of factors, including the historical operating results, known and anticipated trends, and market and

economic conditions. We capitalize acquisition-related costs associated with asset acquisitions.

Real estate assets held for investment, except for land, are depreciated using the straight-line method over the assets’

estimated useful lives of up to 40 years for buildings,15 years for land improvements, and 10 years for building and tenant

improvements. Renovations and/or replacements that improve or extend the life of the asset are capitalized and depreciated

over their estimated useful lives. Lease intangibles are amortized over the remaining term of applicable leases on a straight-

line basis. The cost of ordinary repairs and maintenance is expensed as incurred.

Real estate assets held for investment are assessed for impairment on a quarterly basis. If the depreciated cost basis of the

asset exceeds the undiscounted cash flows over the remaining holding period, the asset is considered forimpairment. The

impairment loss is recognized when thecarrying value of the real estate assets exceeds their fair value. The evaluation of

anticipated future cash flows is highly subjective and is based in part on assumptions regarding future occupancy, rental

rates, capital requirements and anticipated holding periods that could differ materially from actual results. Refer to Note 4

for further informa tion.

During the three months ended September 30, 2026, we recognized$36.4 million of impairment charges related tothree

owned real estate assets, which resulted from changes in the expected hold period. The aggregate fair value of such assets

at the time of impairment was$141.9 million, and was estimated utilizing a discounted cash flow methodology. The owned

real estate assets were measured at fair value on a nonrecurring basis using significant unobservable inputs and are

classified as Level 3 assets in the fair value hierarchy. The significant unobservable inputs utilized in the analysis were the

exit capitalization rate, which ranged from 6.0% to 8.5%, and the unlevered discount rate, which ranged from 8.0% to

14.0%.

Real estate assets are classified asheld-for-sale in the period when they meet the criteria under the ASC Topic 360

“Property, Plant, and Equipment.” Once a real estate asset is classified as held-for-sale, depreciation is suspended and the

asset is reported at the lower of its carrying value or fair value less costs to sell. If circumstances arise and we decide not to

sell a real estate asset previously classified as held-for-sale, the real estate asset is reclassified as held for investment. Upon

reclassification, the real estate asset is measured at the lower of (i) its carrying amount prior to classification as held-for-

sale, adjusted for depreciation expense that would have been recognized had the real estate been classified as held for

investment, and (ii) its estimated fair value at the time of reclassification.

As of September 30, 2026 and December 31, 2025, we had 15 and 12 owned real estate assets, respectively, that were all

classified as held for investment.

Agency Multifamily Lending Partnership

In 2024, we entered into an agreement with M&T Realty Capital Corporation, or MTRCC, a subsidiary of M&T Bank, that

allows our borrowers to access multifamily agency financing through MTRCC’s Fannie Mae DUS and Freddie Mac

Optigo lending platforms, or our Agency Multifamily Lending Partnership. We will receive a portion of origination,

servicing, and other fees for loans that we refer to MTRCC for origination under both the Fannie Mae and Freddie Mac

programs. Additionally, we will share in losses with MTRCC and Fannie Mae on loans that we refer to MTRCC for

origination under the Fannie Mae program.

For loans that we refer to MTRCC for origination under both the Fannie Mae and Freddie Mac programs, we recognize our

allocable portion of origination, servicing, and other fees in other income when we have satisfied our performance

obligations in accordance with the ASC Topic 606, “Revenue from Contracts with Customers,” or ASC 606. Our

performance obligations are generally satisfied when the loan is referred by us to MTRCC and subsequently originated and

sold under the Fannie Mae and Freddie Mac programs. A portion of the fees recognized, such as servicing fees, are variable

and are reevaluated for collectability on a recurring basis.

Loss-sharing Obligation

Pursuant to our agreement with MTRCC, we are subject to a loss-sharing obligation with respect to MTRCC’s obligation

to partially guarantee the performance of loans that they originate and sell under the Fannie Mae program. This loss-

sharing agreement requires us to fund a fixed amount of cash into a segregated account based on the amount MTRCC is

required to fund under the Fannie Mae program, with respect to loans we referred to MTRCC.

In addition, we will recognize a liability for these loss-sharing obligations. This liability will be initially recognized at fair

value with a corresponding expense at inception, and it will subsequently be amortized on a straight-line basis over the life

of the loss-sharing obligation. This liability is included within other liabilities in our consolidated balance sheets. As of

September 30, 2026, our maximum loss-sharing obligation associated with the loans referred by us to MTRCC under the

Fannie Mae program was$5.5 million, and we have recorded related liabilities of$29 thousand. There have beenno losses

incurred as a result of the loss-sharing obligations.

Derivative Financial Instruments

We classify all derivative financial instruments as either other assets or other liabilities on our consolidated balance sheets

at fair value.

On the date we enter into a derivative contract, we designate each contract as (i) a hedge of a net investment in a foreign

operation, or net investment hedge, (ii) a hedge of a forecasted transaction or of the variability of cash flows to be received

or paid related to a recognized asset or liability, or cash flow hedge, (iii) a hedge of a recognized asset or liability, or fair

value hedge, or (iv) a derivative instrument not to be designated as a hedging derivative, or non-designated hedge. For all

derivatives other than those designated as non-designated hedges, we formally document our hedge relationships and

designation at the contract’s inception. This documentation includes the identification of the hedging instruments and the

hedged items, its risk management objectives, strategy for undertaking the hedge transaction and our evaluation of the

effectiveness of its hedged transaction.

On a quarterly basis, we also formally assess whether the derivative we designated in each hedging relationship is expected

to be, and has been, highly effective in offsetting changes in the value or cash flows of the hedged items. If it is determined

that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued and the

changes in fair value of the instrument are included in net income prospectively. Our net investment hedges are assessed

using a method based on changes in spot exchange rates. Gains and losses, representing hedge components excluded from

the assessment of effectiveness, are recognized in interest and related income on our consolidated statements of operations

over the contractual term of our net investment hedges on a systematic and rational basis, as documented at hedge inception

in accordance with our accounting policy election. All other changes in the fair value of our derivative instruments that

qualify as hedges are reported as a component of accumulated other comprehensive income (loss) on our consolidated

financial statements. Deferred gains and losses are reclassified out of accumulated other comprehensive income (loss) and

into net income in the same period or periods during which the hedged transaction affects earnings, and are presented in the

same line item as the earnings effect of the hedged item. For cash flow hedges, this is typically when the periodic swap

settlements are made, while for net investment hedges, this occurs when the hedged item is sold or substantially liquidated.

To the extent a derivative does not qualify for hedge accounting and is deemed a non-designated hedge, the changes in its

fair value are included in net income concurrently.

Proceeds or payments from periodic settlements of derivative instruments are classified on our consolidated statement of

cash flows in the same section as the underlying hedged item.

Debt Securities

We have elected the FVO for our debt securities, which are included in other assets on our consolidated balance sheets.

Refer to Note 6 for further information.

Secured Debt and Asset-Specific Debt

We record investments financed with secured debt or asset-specific debt as separate assets and the related borrowings

under any secured debt or asset-specific debt are recorded as separate liabilities on our consolidated balance sheets. Interest

income earned on the investments and interest expense incurred on the secured debt or asset-specific debt are reported

separately on our consolidated statements of operations.

Term Loans

We record our term loans as liabilities on our consolidated balance sheets. Where applicable, any issue discount or

transaction expenses are deferred and amortized through the maturity date of the term loans as additional non-cash interest

expense.

Senior Secured Notes

We record our senior secured notes as liabilities on our consolidated balance sheets. Where applicable, any issue discount

or transaction expenses are deferred and amortized through the maturity date of the senior secured notes as additional non-

cash interest expense.

Convertible Notes

Convertible note proceeds, unless issued with a substantial premium or an embedded conversion feature, are classified as

debt. Additionally, shares issuable under our convertible notes are included in diluted earnings per share in our

consolidated financial statements, if the effect is dilutive, using the if-converted method, regardless of settlement intent.

Where applicable, any issue discount or transaction expenses are deferred and amortized through the maturity date of the

convertible notes as additional non-cash interest expense.

Deferred Financing Costs

The deferred financing costs that are included as a reduction in the net book value of the related liability on our

consolidated balance sheets include issuance and other costs related to our debt obligations. These costs are amortized as

interest expense using the effective interest method over the life of the related obligations.

Underwriting Commissions and Offering Costs

Underwriting commissions and offering costs incurred in connection with common stock offerings are reflected as a

reduction of additional paid-in capital. Costs incurred that are not directly associated with the completion of a common

stock offering are expensed when incurred.

Fair Value Measurements

The ASC Topic 820, “Fair Value Measurements and Disclosures,” or ASC 820, defines fair value, establishes a framework

for measuring fair value, and requires certain disclosures about fair value measurements under GAAP. Specifically, this

guidance defines fair value based on exit price, or the price that would be received upon the sale of an asset or the transfer

of a liability in an orderly transaction between market participants at the measurement date.

ASC 820 also establishes a fair value hierarchy that prioritizes and ranks the level of market price observability used in

measuring financial instruments. Market price observability is affected by a number of factors, including the type of

financial instrument, the characteristics specific to the financial instrument, and the state of the marketplace, including the

existence and transparency of transactions between market participants. Financial instruments with readily available quoted

prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment

used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs

used in the determination, as follows:

•Level 1: Generally includes only unadjusted quoted prices that are available in active markets for identical

financial instruments as of the reporting date.

•Level 2: Pricing inputs include quoted prices in active markets for similar instruments, quoted prices in less active

or inactive markets for identical or similar instruments where multiple price quotes can be obtained, and other

observable inputs, such as interest rates, yield curves, credit risks, and default rates.

•Level 3: Pricing inputs are unobservable for the financial instruments and include situations where there is little, if

any, market activity for the financial instrument. These inputs require significant judgment or estimation by

management or third parties when determining fair value and generally represent anything that does not meet the

criteria of Levels 1 and 2.

Certain of our other assets are reported at fair value, as of quarter-end, either (i) on a recurring basis or (ii) on a

nonrecurring basis, as a result of impairment or other events. Our assets that are recorded at fair value are discussed further

in Note 18. We generally value our assets recorded at fair value by either (i) discounting expected cash flows based on

assumptions regarding the collection of principal and interest and estimated market rates, or (ii) obtaining assessments from

third parties. For collateral-dependent loans that are identified as impaired, we measure impairment by comparing our

estimation of the fair value of the underlying collateral, less costs to sell, to the book value of the respective loan. These

valuations require significant judgments, which include assumptions regarding capitalization rates, discount rates, leasing,

creditworthiness of major tenants, occupancy rates, availability and cost of financing, exit plan, loan sponsorship, actions

of other lenders, and other factors.

We have elected the FVO fortwo of our investments in unconsolidated entities, our Bank Loan Portfolio Joint Venture and

Homebuilder Finance Joint Venture, and therefore report these investments at fair value. Given the fair value of these

investments is not readily determinable, the net asset value of the entities is used as a practical expedient.

receivable with an aggregate amortized cost basis of$1.3 billion, net of cost-recovery proceeds. The CECL reserve was

recorded based on our estimation of the fair value of the loans' aggregate underlying collateral as of September 30, 2026.

These loans receivable are therefore measured at fair value on a nonrecurring basis using significant unobservable inputs,

and are classified as Level 3 assets in the fair value hierarchy. We estimated the fair value of the collateral underlying the

loans receivable using a discounted cash flow methodology that considered a variety of inputs including property

performance, market data, and comparable sales, as applicable. The significant unobservable inputs utilized in the analysis

include the exit capitalization rate assumption used to forecast the future sale price of the underlying real estate collateral,

which ranged from 4.9% to 8.8%, and the unlevered discount rate assumption, which ranged from 9.0% to 15.0%.

During thenine months ended September 30, 2026, we acquired legal title tothree owned real estate assets through

foreclosure or deed-in-lieu of foreclosure transactions. At the time of each acquisition, we determined the fair value of the

real estate assets based on a variety of inputs, as applicable, including, but not limited to, estimated cash flow projections,

leasing assumptions, required capital expenditures, market data, and comparable sales. The owned real estate assets were

measured at fair value on a nonrecurring basis using significant unobservable inputs and are classified as Level 3 assets in

the fair value hierarchy. The significant unobservable inputs employed include (i) the exit capitalization rate assumption

used to forecast the future sale price of the assets, which ranged from 5.8% to 7.5%, and (ii) the unlevered discount rate

assumption, which ranged from 8.0% to 11.0%. Refer to Notes 4 and 18 for further information.

We are also required by GAAP to disclose fair value information about financial instruments, which are not otherwise

reported at fair value in our consolidated balance sheet, to the extent it is practicable to estimate a fair value for those

instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments.

The following methods and assumptions are used to estimate the fair value of each class of financial instruments, for which

it is practicable to estimate that value:

•Cash and cash equivalents: The carrying amount of cash and cash equivalents approximates fair value.

•Loans receivable, held-for-investment, net: The fair values of these loans were estimated using a discounted cash

flow methodology, taking into consideration various factors including capitalization rates, discount rates, leasing,

actions of other lenders, and other factors.

•Loans receivable, held-for-sale: The fair values of these loans were estimated using executed sale agreements.

•Derivative financial instruments: The fair value of our foreign currency and interest rate contracts was estimated

using advice from a third-party derivative specialist, based on contractual cash flows and observable inputs

comprising foreign currency rates and credit spreads.

•Secured debt, net and other secured debt: The fair value of these instruments was estimated based on the rate at

which a similar credit facility would currently be priced. Other secured debt is included in other liabilities in our

consolidated balance sheets.

•Securitized debt obligations, net: The fair value of these instruments was estimated by utilizing third-party pricing

service providers. In determining the value of a particular investment, pricing service providers may use broker-

dealer quotations, reported trades, or valuation estimates from their internal pricing models to determine the

reported price.

•Asset-specific debt, net: The fair value of these instruments was estimated based on the rate at which a similar

agreement would currently be priced.

•Term loans, net: The fair value of these instruments was estimated by utilizing third-party pricing service

providers. In determining the value of a particular investment, pricing service providers may use broker-dealer

quotations, reported trades, or valuation estimates from their internal pricing models to determine the reported

price.

•Senior secured notes, net: The fair value of these instruments was estimated by utilizing third-party pricing service

providers. In determining the value of a particular investment, pricing service providers may use broker-dealer

quotations, reported trades, or valuation estimates from their internal pricing models to determine the reported

price.

•Convertible notes, net: Each series of the convertible notes is actively traded and their fair values were obtained

using quoted market prices.

Income Taxes

Our financial results generally do not reflect provisions for current or deferred income taxes on our REIT taxable income.

We believe that we operate in a manner that will continue to allow us to be taxed as a REIT and, as a result, we generally

do not expect to pay substantial corporate level taxes other than those payable by our taxable REIT subsidiaries. If we were

to fail to meet these requirements, we may be subject to federal, state, and local income tax on current and past income, and

penalties. Refer to Note 16 for further information.

Stock-Based Compensation

Our stock-based compensation consists of awards issued to our Manager, certain individuals employed by an affiliate of

our Manager, and certain members of our board of directors that vest over the life of the awards, as well as deferred stock

units issued to certain members of our board of directors. Stock-based compensation expense is recognized for these

awards in net income on a variable basis over the applicable vesting period of the awards, based on the value of our class A

common stock. Refer to Note 17 for further information.

Earnings per Share

Basic earnings per share, or Basic EPS, is computed in accordance with the two-class method and is based on (i) the net

earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units,

divided by (ii) the weighted-average number of shares of our class A common stock, including restricted class A common

stock and deferred stock units outstanding during the period. Our restricted class A common stock is considered a

participating security, as defined by GAAP, and has been included in our Basic EPS under the two-class method as these

restricted shares have the same rights as our other shares of class A common stock, including participating in any gains or

losses.

Diluted earnings per share, or Diluted EPS, is determined using the if-converted method, and is based on (i) the net

earnings, adjusted for interest expense incurred on our convertible notes during the relevant period, net of incentive fees,

allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by (ii)

the weighted-average number of shares of our class A common stock, including restricted class A common stock, deferred

stock units, and shares of class A common stock issuable under our convertible notes. Refer to Note 14 for further

discussion of earnings per share.

Foreign Currency

In the normal course of business, we enter into transactions not denominated in United States, or U.S., dollars. Foreign

exchange gains and losses arising on such transactions are recorded as a gain or loss in our consolidated statements of

operations. In addition, we consolidate entities that have a non-U.S. dollar functional currency. Non-U.S. dollar-

denominated assets and liabilities are translated to U.S. dollars at the exchange rate prevailing at the reporting date and

income, expenses, gains, and losses are translated at the average exchange rate over the applicable period. Cumulative

translation adjustments arising from the translation of non-U.S. dollar-denominated subsidiaries are recorded in other

comprehensive income (loss).

Recent Accounting Pronouncements

In December 2025, the FASB issued Accounting Standards Update, or ASU, 2025-11, “Interim Reporting (Topic 270):

Narrow-Scope Improvements,” which amends the guidance in ASC 270, Interim Reporting. The update enhances interim

disclosure requirements by clarifying the information that must be presented in quarterly periods, including improved

transparency regarding significant events, accounting policy updates, and material developments that occur between annual

reporting dates. ASU 2025-11 also aligns certain interim reporting requirements more closely with annual disclosure

objectives to promote consistency and comparability. The amendments are effective for interim periods beginning after

December 15, 2027, and early adoption is permitted. We have not early adopted ASU 2025-11 and do not expect the

adoption of ASU 2025-11 to have a material impact on our consolidated financial statements.

In November 2025, the FASB issued ASU 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting

Improvements,” which amends the guidance in ASC 815, Derivatives and Hedging. The update refines certain hedge

accounting requirements, including clarifications to the designation and documentation criteria for hedge relationships,

improvements to the assessment of hedge effectiveness, and enhanced disclosures intended to provide greater transparency

into an entity’s risk management activities involving derivatives. ASU 2025-09 is effective for annual periods beginning

after December 15, 2026, including interim periods within those annual periods, and early adoption is permitted. We have

not early adopted ASU 2025-09 and do not expect the adoption of ASU 2025-09 to have a material impact on our

consolidated financial statements.

In November 2025, the FASB issued ASU 2025-08, “Financial Instruments—Credit Losses (Topic 326): Purchased

Loans,” which clarifies the application of the CECL model to purchased loans, including purchased credit‑deteriorated

loans, and enhances related disclosure requirements. ASU 2025-08 is effective for annual reporting periods beginning after

December 15, 2026, including interim periods within those annual periods. Early adoption is permitted. We have not early

adopted ASU 2025-08 and do not expect the adoption of ASU 2025-08 to have a material impact on our consolidated

financial statements.

In July 2025, the FASB issued ASU 2025-05, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit

Losses for Accounts Receivable and Contract Assets,” which amends the guidance in ASC 326. This update provides a

practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract

assets that arise from transactions accounted for under ASC 606. The amendment notes that in developing reasonable and

supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes

that current conditions as of the balance sheet date do not change for the remaining life of the asset. ASU 2025-05 is

effective for annual periods beginning after December 15, 2025, including interim periods within those annual periods, and

early adoption is permitted. We recognize revenue from our Agency Multifamily Lending Partnership and income from our

hospitality owned real estate assets pursuant to ASC 606. The adoption of ASU 2025-05 in 2026 did not have a material

impact on our consolidated financial statements.

In May 2025, the FASB issued ASU 2025-03, “Business Combinations (Topic 805) and Consolidation (Topic 810):

Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity,” which amends the guidance in ASC

805. This update clarifies the determination of the accounting acquirer in business combinations that are primarily effected

through the exchange of equity interests and involve the acquisition of a VIE. Specifically, entities are now required to

consider the factors outlined in ASC 805-10-55-12 through 55-15 when determining the accounting acquirer, rather than

defaulting to the primary beneficiary of the VIE as the accounting acquirer. ASU 2025-03 is effective for annual periods

beginning after December 15, 2026, including interim periods within those annual periods, and early adoption is permitted.

We have not early adopted ASU 2025-03 and do not expect the adoption of ASU 2025-03 to have a material impact on our

consolidated financial statements.

In November 2024, the FASB issued ASU 2024-04 “Debt with Conversion and Other Options (Subtopic 470-20): Induced

Conversions of Convertible Debt Instruments,” or ASU 2024-04. ASU 2024-04 clarifies the accounting treatment for

settlement of a convertible debt instrument as an induced conversion. ASU 2024-04 is effective on a prospective basis,

with the option for retrospective application, for fiscal years beginning after December 15, 2025. The adoption of ASU

2024-04 in 2026 did not have a material impact on our consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03 “Expense Disaggregation Disclosures (Subtopic 220-40):

Disaggregation of Income Statement Expenses,” or ASU 2024-03. ASU 2024-03 requires disclosures in the notes to the

financial statements on specified information about certain costs and expenses for each interim and annual reporting period.

ASU 2024-03 is effective on a prospective basis, with the option for retrospective application, for annual periods beginning

after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027, and early

adoption is permitted. We have not early adopted ASU 2024-03 and do not expect the adoption of ASU 2024-03 to have a

material impact on our consolidated financial statements.

3. LOANS RECEIVABLE

The following table details overall statistics for our loans receivable portfolio ($ in thousands):

(1)Unfunded commitments will primarily be funded to finance our borrowers’ construction or development of real

estate-related assets, capital improvements of existing assets, or lease-related expenditures. These commitments will

generally be funded over the term of each loan, subject in certain cases to an expiration date.

(2)The weighted-average cash coupon and all-in yield are expressed as a spread over the relevant floating benchmark

rates, which include SOFR, SONIA, EURIBOR, CORRA, and other indices, as applicable to each loan. As of

September 30, 2026,96% of our loans held-for-investment by principal balance earned a floating rate of interest,

primarily indexed to SOFR. The remaining 4% of our loans held-for-investment by principal balance earned a fixed

rate of interest. As of December 31, 2025,97% of our loans by principal balance earned a floating rate of interest,

primarily indexed to SOFR. The remaining 3% of our loans by principal balance earned a fixed rate of interest. In

addition to cash coupon, all-in yield includes the amortization of deferred origination and extension fees, loan

origination costs, and purchase discounts, as well as the accrual of exit fees. Excludes loans accounted for under the

cost-recovery and nonaccrual methods, if any.

(3)Maximum maturity assumes all extension options are exercised by the borrower; however, our loans may be repaid

prior to such date. Excludes loans accounted for under the cost-recovery and nonaccrual methods, if any. As of

September 30, 2026,44% of our loans held-for-investment by principal balance were subject to yield maintenance

or other prepayment restrictions and 56% were open to repayment by the borrower without penalty. As of

December 31, 2025,40% of our loans by principal balance were subject to yield maintenance or other prepayment

restrictions and 60% were open to repayment by the borrower without penalty.

Loan Sales

During the three months ended September 30, 2026, we entered into an agreement to sell eight whole mortgage loans to an

unaffiliated third party for total estimated net sales proceeds of$615.6 million, which resulted in these loans being

classified as loans receivable, held-for-sale on our consolidated balance sheets as of September 30, 2026. This resulted in a

$63.9 million valuation adjustment recognized to reduce the carrying value of these loans, which was$679.5 million prior

to the adjustment. Two of the whole loans consisted of both a performing senior loan and an impaired subordinate loan.

Thetwo subordinate loans carried$61.9 million of previously recorded asset-specific CECL reserves. Six of the whole

loans were collateralized by office assets andtwo were collateralized by multifamily assets, all of which were located in the

United States. The valuation adjustment was included invaluation adjustment on loans receivable, held-for-sale on our

consolidated statements of operations during the three months ended September 30, 2026. The sale of these loans closed

subsequent to September 30, 2026.

The following table details the index rate floors for ourloans receivable, held-for-investment portfolio as of September 30,

2026 ($ in thousands):

(1)Includes Euro, British Pound Sterling, Australian Dollar, and Canadian Dollar currencies.

(2)Includes all impaired loans.

(3)As of September 30, 2026, the weighted-average index rate floor of our floating-rate loans receivable, held-for-

investment principal balance was 1.73%. Excluding 0.00% index rate floors and loans with no floor, the weighted-

average index rate floor was 2.28%.

Activity relating to ourloans receivable, held-for-investment portfolio was as follows ($ in thousands):

(1)Included in this amount are sales of$251.5 million of pari passu participations intwo loans collateralized by

properties located in the United Kingdom.

(2)Excludes a$1.8 million recovery of amounts previously charged off related to a note receivable issued in 2024 that

is no longer reflected on our consolidated balance sheets. The recovery is reflected in our consolidated statements of

operations in the increase in current expected credit loss reserve and is not included in the activity presented above.

(3)This amount relates to intangible and other assets recorded in connection with a loan that was transferred to owned

real estate, net of any liabilities recorded upon acquisition. See Note 6 for further information.

(4)During thenine months ended September 30, 2026, we received$19.2 million of previously accrued payment-in-

kind interest upon repayment of a loan.

(5)Other items primarily consist ofpurchase and sale discounts or premiums, exit fees, and deferred origination

expenses.

The tables below detail the property type and geographic distribution of the properties securing the loans in ourloans

receivable, held-for-investment portfolio ($ in thousands):

loans.

(1)Net loan exposure reflects the amount of each loan that is subject to risk of credit loss to us as of December 31,

2025, which is our principal balance net of (i)$999.8 million of asset-specific debt, (ii)$24.5 million of cost-

recovery proceeds, and (iii) our total loans receivable CECL reserve of$284.4 million. Our asset-specific debt is

structurally non-recourse and term-matched to the corresponding collateral loans.

Loan Risk Ratings

As further described in Note 2, we evaluate ourloans receivable, held-for-investment portfolio on a quarterly basis. In

conjunction with our quarterly loan portfolio review, we assess the risk factors of each loan, and assign a risk rating based

on several factors. Factors considered in the assessment include, but are not limited to, risk of loss, origination LTV, debt

yield, collateral performance, structure, exit plan, and sponsorship. Loans are rated “1” (less risk) through “5” (greater

risk), which ratings are defined in Note 2.

The following tables allocate the amortized cost basis and net loan exposure balances of ourloans receivable, held-for-

investment portfolio based on our internal risk ratings ($ in thousands):

$597.3 million. Our net loan exposure as of December 31, 2025 is our principal balancenet of (i)$999.8 million of

asset-specific debt, (ii)$24.5 million of cost-recovery proceeds, and (iii) our total loans receivable CECL reserve of

$284.4 million. Our asset-specific debt is structurally non-recourse and term-matched to the corresponding collateral

loans.

Ourloans receivable, held-for-investment portfolio had a weighted-average risk rating of 3.1 and 3.0, based on net loan

exposure, as of September 30, 2026 and December 31, 2025, respectively.

Current Expected Credit Loss Reserve

The CECL reserves required under GAAP reflect our current estimate of potential credit losses related to theloans

receivable, held-for-investment portfolio included in our consolidated balance sheets. Refer to Note 2 for further discussion

of our CECL reserves. The following table presents the activity in our loans receivable CECL reserves by investment pool

for thethree and nine months ended September 30, 2026 and 2025 ($ in thousands):

(1)Includesone U.S. dollar-denominated loan that is located in Bermuda.

(2)Represents a transfer of asset-specific CECL reserves ontwo previously impaired subordinate loans that were

transferred to loans receivable, held-for-sale during thethree months ended September 30, 2026.

During thethree months ended September 30, 2026, the CECL reserves against ourloans receivable, held-for-investment

portfolio increased by $199.5 million. This increase was primarily driven by a$293.8 million increase in our asset-specific

CECL reserve, partially offset by a$25.5 million decrease in our general CECL reserve. Theincrease in our asset-specific

reserve was primarily driven bysix additional loans with an aggregate amortized cost basis of$787.8 million that were

impaired during thethree months ended September 30, 2026, of which five are secured by office properties, andone is

secured by a hospitality asset. The office sector recovery in certain markets has continued to lag other commercial real

estate sectors, which has, in certain cases, extended business plans on transitional properties and impacted their

performance, affecting some borrowers’ willingness and ability to continue to support their assets. During thethree months

ended September 30, 2026, we recorded$8.7 million of interest income on these loans. Upon determining that thesix loans

were impaired, the income accrual was suspended, as the recovery of interest income and principal was doubtful. The

decrease in our general CECL reserve was primarily driven bychanges in risk ratings, including the impact of the six

newly impaired loans moving out of the general CECL reserve pool, and a decrease in our loans receivable, held-for-

investment balance, partially offset by an increase in the historical loss rate used in reserve calculations related to the

additional reserve charge-offs.

The increase in our asset-specific reserve was reduced by (i) the transfer of$61.9 million of CECL reserves related totwo

previously impaired subordinate loans that were transferred to held-for-sale as of September 30, 2026, which were sold

subsequent to September 30, 2026, and (ii) charge-offs of$6.9 million primarily related to the resolution ofone previously

impaired loan as a result of our acquisition of title through a deed-in-lieu of foreclosure of a mixed-use collateral property

located in Richmond, CA, which is now included on our consolidated balance sheet as an owned real estate asset. As a

result of these changes, our total loans receivable CECL reserves increased to$597.3 million as of September 30, 2026.

receivable, held-for-investment, with an aggregate amortized cost basis of$1.3 billion, net of cost-recovery proceeds.

During thethree months ended September 30, 2026, we received$4.4 million of cash proceeds from previously impaired

loans that were applied as a reduction to the amortized cost basis of each respective loan. Impairments are each determined

individually as a result of changes in the specific credit quality factors for each such loan. These factors included, among

others, (i) the underlying collateral performance, (ii) discussions with the borrower, (iii) borrower events of default, and

(iv) other facts that impact the borrower’s ability to pay the contractual amounts due under the terms of the loan. This asset-

specific CECL reserve was recorded based on our estimation of the fair value of each loan’s underlying collateral as of

As of September 30, 2026, one of our performing loans with an amortized cost basis of$149.8 million was in payment

default, was greater than 90 days past due on its interest payment, and had a risk rating of “4.” This loan was not impaired

as of September 30, 2026 as we expect to fully recover all contractual principal and interest amounts due under the loan

agreement. All other borrowers under performing loans were in compliance with the applicable contractual terms of each

respective loan, including any required payment of interest. Refer to Note 2 for further discussion of our policies on

revenue recognition and our CECL reserves.

Our primary credit quality indicator is our risk ratings, which are further discussed above. The following tables present the

amortized cost basis of ourloans receivable, held-for-investment portfolio as of September 30, 2026 and December 31,

2025, respectively, by year of origination and risk rating ($ in thousands):

(1)Year loan was originated or acquired by us. Origination dates are subsequently updated to reflect material loan

modifications.

(2)Represents charge-offs by year of origination during thenine months ended September 30, 2026 andyear ended

December 31, 2025, respectively, net of any recoveries of amounts previously charged off.

Loan Modifications Pursuant to ASC 326

During thetwelve months ended September 30, 2026, we entered intoone loan modification that requires disclosure

pursuant to ASC 326. This loan was collateralized by a life sciences asset.

The loan had a risk rating of “5” at the time of modification, which resulted in the bifurcation of the loan into separate

senior and subordinate loans. The loan modification also included a term extension of 4.3 years and the interest rate

decreased by 3.56%. We are accruing all of the interest on the senior loan that is paying current, and deferring interest on

the subordinate loan, which is paid-in-kind. As of September 30, 2026, the aggregate amortized cost basis of these loans

was$122.5 million, or 0.8% of our aggregate loans receivable, held-for-investment portfolio, with an aggregate

$34.6 million of unfunded commitments. These loans were in compliance with their modified contractual terms as of

September 30, 2026. As of September 30, 2026, the newly bifurcated senior loan had a risk rating of “4,” and the newly

bifurcated subordinate loan had a risk rating of “5,” as collection of amounts due under the loan terms was doubtful. The

loan with a risk rating of “4” is included in the determination of our general CECL reserve and the loan with a risk rating of

“5” is evaluated individually for an asset-specific CECL reserve.

Loan modifications that allow the option to pay interest in-kind increase our potential economics and the size of our

secured claim, as interest is capitalized and added to the outstanding principal balance for applicable loans. As of

September 30, 2026, no income was recorded on our loans subsequent to determining that such loans were impaired and

risk rated “5.”

4. OWNED REAL ESTATE, NET

As of September 30, 2026 and December 31, 2025, we had 15 and 12 owned real estate assets, respectively. During the

nine months ended September 30, 2026, we acquired three owned real estate assets through foreclosure or deed-in-lieu of

foreclosure transactions with an aggregate acquisition price of$273.9 million. We allocated$168.1 million to building and

building improvements,$86.1 million to land and land improvements,$14.1 million to acquired intangible assets, and

$5.6 million to other components of the purchase price, including cash held in reserves at the time of acquisition. In

aggregate, we charged off$86.1 million of CECL reserves relating to the loans that had previously been secured by these

assets, as the loans’ aggregate amortized cost basis of$360.0 million at the time of the acquisitions exceeded the

acquisition date fair value noted above. See Note 2 for further discussion of owned real estate assets.

Acquisitions

The acquisitions ofthree owned real estate assets during thenine months ended September 30, 2026 were accounted for as

asset acquisitions under ASC 805, and we recognized the properties as owned real estate assets held-for-investment. The

following table presents the owned real estate assets that were acquired during thenine months ended September 30, 2026

Dispositions

During thenine months ended September 30, 2026, we completed a partial sale ofone owned real estate asset, a

multifamily property located in San Antonio, TX. The carrying value of the asset at the time of disposition was

$15.3 million, and we received net cash proceeds of$15.1 million, resulting in a net loss of$0.2 million, which is included

innet loss on disposition of owned real estate on our consolidated statements of operations.

The following table presents the assets and liabilities related to owned real estate held for investment included in our

consolidated balance sheets ($ in thousands):

(1)Included within other assets on our consolidated balance sheets. Refer to Note 6 for further information.

(2)Included within other liabilities on our consolidated balance sheets. Refer to Note 6 for further information.

Revenue and expenses from owned real estate consisted of the following ($ in thousands):

The following table presents the undiscounted future minimum rents we expect to receive for our office properties as of

September 30, 2026. Leases at our multifamily assets are short term, generally 12 months or less, and are therefore not

included ($ in thousands):

The following table presents the estimated future amortization of lease intangibles for each of the next five years and

thereafter as of September 30, 2026 ($ in thousands):

Impairment

During thethree months ended September 30, 2026, we recognized$36.4 million of aggregate impairment charges related

tothree owned real estate assets, two of which were office assets and one of which was a multifamily asset. The

impairments resulted from updates to the undiscounted cash flow assumptions, primarily a shortening of the expected hold

period for the properties.

We didnot recognize any impairment charges during thenine months ended September 30, 2025.

5. INVESTMENTS IN UNCONSOLIDATED ENTITIES

As of September 30, 2026, we hold certain investments in unconsolidated entities that are accounted for under the equity

method of accounting or the FVO, as our ownership interest in each entity does not meet the requirements for

consolidation. Refer to Note 2 for further details.

The following tables detail our investments in unconsolidated entities ($ in thousands):

(1)The number of assets represents the number of commercial real estate properties.

(2)The number of assets represents the number of commercial mortgage loans held by each entity.

(3)Represents our aggregate ownership interest in our Bank Loan Portfolio Joint Venture, which owns an initial

portfolio of commercial mortgage loans acquired during the three months ended June 30, 2025, in which we hold a

29% interest, and an additional portfolio acquired during the three months ended September 30, 2025, in which we

hold a 50% interest.

The following table details the activity related to our investments in unconsolidated entities during thenine months ended

September 30, 2026 ($ in thousands):

(1)Includes our share of non-cash items such as (i) depreciation and amortization, and (ii) unrealized gains or losses

recorded by unconsolidated entities.

Our Net Lease Joint Venture and Bank Loan Portfolio Joint Venture have each entered into and may continue to enter into

derivative agreements where we would be required to make payment for periodic or final settlement of derivative contracts

if either our Net Lease Joint Venture or Bank Loan Portfolio Joint Venture, as applicable, is unable to fulfill its respective

obligations.

As of September 30, 2026, our Homebuilder Finance Joint Venture had unfunded commitments under certain of the loans

it holds, which primarily relate to future construction costs expected to be funded over the remaining terms of the

underlying loans, subject to the satisfaction of customary funding conditions. We expect these commitments to be funded

primarily through our Homebuilder Finance Joint Venture’s financing arrangements, with the remainder funded through

capital contributions from the joint venture partners, including us, in proportion to our respective ownership interests. As of

September 30, 2026, our share of such unfunded commitments was$69.7 million.

6. OTHER ASSETS AND LIABILITIES

Other Assets

The following table details the components of our other assets ($ in thousands):

(1)Represents investments in senior secured notes and an investment in a significant risk transfer, or SRT, transaction

with a UK financial institution structured as a credit-linked note, or the UK Bank Loan Portfolio SRT. These

investments are recorded at fair value, with changes in fair value recognized inother income, net in our consolidated

statements of operations.

(2)Includes$120.8 million and$55.5 million as of September 30, 2026 and December 31, 2025, respectively, of cash

collateral held by our CLOs that was subsequently remitted by the trustee to repay a portion of the outstanding

senior CLO securities, or that was subsequently reinvested by purchasing additional collateral into our CLOs.

(3)Primarily represents loan principal repayments held by our third-party loan servicers as of the balance sheet date that

were remitted to us during the subsequent remittance cycle.

Other Liabilities

The following table details the components of our other liabilities ($ in thousands):

(1)Represents financing on our retained investment in the European Loan Securitization and on an investment in debt

securities. Refer to Note 8 for further information on the European Loan Securitization.

(2)Represents pending transfers from our third-party loan servicer that were remitted to our banking counterparties

during the subsequent remittance cycle.

(3)Represents the CECL reserve related to our unfunded loan commitments.

Current Expected Credit Loss Reserves for Unfunded Loan Commitments

As of September 30, 2026, we had aggregate unfunded commitments of$915.4 million related to 42 loans receivable, held-

for-investment. The expected credit losses over the contractual period of our loans are impacted by our obligations to

extend further credit through our unfunded loan commitments. See Note 2 for further discussion of the CECL reserves

related to our unfunded loan commitments, and Note 21 for further discussion of our unfunded loan commitments. During

thethree and nine months ended September 30, 2026, we recorded decreases in the CECL reserves related to our unfunded

loan commitments of$3.5 million and$2.6 million, respectively, bringing our total unfunded loan commitments CECL

reserve to$9.1 million as of September 30, 2026. During thethree and nine months ended September 30, 2025, we

recorded increases in the CECL reserves related to our unfunded loan commitments of$2.0 million and$3.3 million,

respectively, bringing our total unfunded loan commitments CECL reserve to$13.7 million as of September 30, 2025.

7. SECURED DEBT, NET

Our secured debt represents borrowings under our secured credit facilities. During thenine months ended September 30,

2026, we closed$1.1 billion of new borrowings against$1.5 billion of collateral assets.

The following table details our secured debt ($ in thousands):

(1)Costs incurred in connection with our secured debt are recorded on our consolidated balance sheets when incurred

and recognized as a component of interest expense over the life of each related facility.

Secured Credit Facilities

Our secured credit facilities are bilateral agreements we use to finance diversified pools of senior loan and owned real

estate collateral with sufficient flexibility to accommodate our investment and asset management strategy. The facilities are

generally structured to provide currency, index, and term-matched financing without capital markets-based mark-to-market

provisions. Our credit facilities are diversified across 16 counterparties, primarily consisting of top global financial

institutions to minimize our counterparty risk exposure.

The following table details our secured credit facilities as of September 30, 2026 ($ in thousands):

(1)Represents the number of lenders with fundings advanced in each respective currency, as well as the total number of

facility lenders.

(2)Our secured debt agreements are generally term-matched to their underlying collateral. Therefore, the weighted-

average maturity is generally allocated based on the maximum maturity date of the collateral loans, assuming all

extension options are exercised by the borrower. In limited instances, the maturity date of the respective secured

credit facility is used.

(3)The spread, all-in cost, and all-in yield are expressed over the relevant floating benchmark rates, which include

SOFR, SONIA, EURIBOR, CORRA, and other indices as applicable.

(4)In addition to spread, the cost includes the associated deferred fees and expenses related to the respective

borrowings. In addition to cash coupon, all-in yield includes the amortization of deferred origination and extension

fees, loan origination costs, and purchase discounts, as well as the accrual of exit fees. All-in yield excludes loans

accounted for under the cost-recovery and nonaccrual methods, if any, and owned real estate assets.

(5)Represents the weighted-average all-in cost as of September 30, 2026 and is not necessarily indicative of the spread

applicable to recent or future borrowings.

(6)Represents the principal balance of the collateral loans receivable, held-for-investment and the carrying value of the

collateral owned real estate assets and loans receivable, held-for-sale.

(7)Includes Australian Dollar and Canadian Dollar currencies.

The availability of funding under our secured credit facilities is based on the amount of approved collateral, which

collateral is proposed by us in our discretion and approved by the respective counterparty in its discretion, resulting in a

mutually agreed collateral portfolio construction. Certain structural elements of our secured credit facilities, including the

limitation on recourse to us and facility economics, are influenced by the specific collateral portfolio construction of each

facility, and therefore vary within and among the facilities.

Our secured credit facilities generally permit us to increase or decrease the amount advanced against the pledged collateral

in our discretion within certain maximum/minimum amounts and frequency limitations. As of September 30, 2026, there

was an aggregate$782.3 million available to be drawn at our discretion under our credit facilities.

Financial Covenants

As of September 30, 2026, we are subject to the following financial covenants related to our secured debt and secured debt

of our unconsolidated entities: (i) our ratio of earnings before interest, taxes, depreciation, and amortization, or EBITDA, to

fixed charges, as defined in the agreements, shall be not less than 1.3 to 1.0; (ii) our tangible net worth, as defined in the

agreements, shall not be less than$2.8 billion as of each measurement date plus 75% to 85% of the net cash proceeds of

future equity issuances subsequent to September 30, 2026; (iii) cash liquidity shall not be less than the greater of (x)$10.0

million or (y) no more than 5% of our recourse indebtedness; and (iv) our indebtedness shall not exceed 83.33% of our

total assets. As of September 30, 2026 and December 31, 2025, we were in compliance with these covenants.

8. SECURITIZED DEBT OBLIGATIONS, NET

We have financed certain pools of our loans through CLOs and have also financed one of our loans through a securitization

vehicle, or the European Loan Securitization. The CLOs and the European Loan Securitization are consolidated in our

financial statements and have issued securitized debt obligations that are non-recourse to us. Refer to Note 19 for further

discussion of our CLOs and the European Loan Securitization. The following tables detail our securitized debt obligations

and the underlying collateral assets that are financed by our CLOs and the European Loan Securitization ($ in thousands):

origination costs, purchase discounts, and accrual of exit fees, while all-in cost includes the amortization of deferred

origination fees and financing costs. The weighted-average all-in yield and cost are expressed as a spread over the

relevant floating benchmark rates, which is SOFR for the CLOs and EURIBOR for the European Loan

Securitization. All-in yield excludes loans accounted for under the cost-recovery and nonaccrual methods, if any,

owned real estate assets, and cash from repayment proceeds held in certain of our CLOs that may be used to add

new eligible collateral assets.

(3)Underlying collateral assets term represents the weighted-average final maturity of such loans, assuming all

extension options are exercised by the borrower, and excludes owned real estate assets. Repayments of securitized

debt obligations are tied to timing of the related collateral loan asset repayments. The term of these obligations

represents the rated final distribution date of the securitizations.

(4)We financed our$55.8 million retained interests in the securitization under a repurchase agreement structured

(5)During thethree and nine months ended September 30, 2026, we recorded$39.2 million and$114.1 million,

respectively, of interest expense related to our securitized debt obligations.

origination costs, purchase discounts, and accrual of exit fees.

(3)The weighted-average all-in yield and cost are expressed as a spread over the relevant floating benchmark rates,

which is SOFR for the CLOs and EURIBOR for the European Loan Securitization. All-in yield excludes loans

accounted for under the cost-recovery and nonaccrual methods, if any, owned real estate assets, and cash from

repayment proceeds held in certain of our CLOs that may be used to add new eligible collateral assets.

(4)Underlying collateral assets term represents the weighted-average final maturity of such loans, assuming all

extension options are exercised by the borrower. Repayments of securitized debt obligations are tied to timing of the

related collateral loan asset repayments. The term of these obligations represents the rated final distribution date of

the securitizations.

(5)We financed our$55.8 million retained interests in the securitization under a repurchase agreement structured

(6)During theyear ended December 31, 2025, we recorded$140.0 million of interest expense related to our securitized

debt obligations.

9. ASSET-SPECIFIC DEBT, NET

The following tables detail our asset-specific debt ($ in thousands):

(2)The weighted-average all-in yield and cost are expressed as a spread over the relevant floating benchmark rates,

which include SOFR and CORRA, as applicable. These floating rate loans and related liabilities are currency and

index-matched to the applicable benchmark rate relevant in each arrangement. In addition to cash coupon, yield/cost

includes the amortization of deferred origination fees and financing costs.

(3)The weighted-average term is determined based on the maximum maturity of the corresponding loans, assuming all

extension options are exercised by the borrower. Our non-recourse, asset-specific debt is term-matched in each case

to the corresponding collateral loans.

10. TERM LOANS, NET

During thenine months ended September 30, 2026, we borrowed an additional$770.8 million under a B-9 Term Loan, the

proceeds of which were used, among other things, to repay all$695.8 million in principal outstanding under the B-6 Term

Loan.

The following table details the net book value of each of our senior term loan facilities, or Term Loans, on our consolidated

balance sheets ($ in thousands):

(1)The B-7 Term Loan and B-9 Term Loan borrowings are subject to a benchmark interest rate floor of 0.50%. The

Term Loans are indexed to one-month SOFR.

(2)Includes issue discount and transaction expenses that are amortized through interest expense over the life of the

applicable Term Loans.

The Term Loans are partially amortizing, with an amount equal to 1.0% per annum of the aggregate initial principal

balance due in quarterly installments.

The following table details our interest expense related to the Term Loans ($ in thousands):

The Term Loans contain the financial covenant that our indebtedness shall not exceed 83.33% of our total assets. As of

September 30, 2026 and December 31, 2025, we were in compliance with this covenant. Refer to Note 2 for further

discussion of our accounting policies for the Term Loans.

11. SENIOR SECURED NOTES, NET

During thenine months ended September 30, 2026, we issued an additional$450.0 million principal amount of senior

secured notes, or Senior Secured Notes, the proceeds of which were used, among other things, to repay existing secured

debt.

The following table details the net book value of our Senior Secured Notes on our consolidated balance sheets ($ in

thousands):

(1)For certain of the Senior Secured Notes, we have entered into interest rate swaps that effectively convert our fixed

rate exposure to floating rate exposure. The interest rate swaps are indexed to one-month SOFR. Refer to Note 13

for further discussion.

(2)Includes transaction expenses that are amortized through interest expense over the life of the Senior Secured Notes.

(3)Represents the aggregate fair value of interest rate swaps that we entered into to convert the fixed rate exposure of

both the December 2024 and May 2026 Senior Secured Notes into floating rate. Refer to Note 13 for further

discussion.

The following table details our interest expense related to the Senior Secured Notes ($ in thousands):

The Senior Secured Notes contain the financial covenant that our indebtedness shall not exceed 83.33% of our total assets.

As of September 30, 2026 and December 31, 2025, we were in compliance with this covenant. Under certain

circumstances, we may, at our option, release all of the collateral securing our Senior Secured Notes, in which case we

would also be required to maintain a total unencumbered assets to total unsecured indebtedness ratio of 1.20 or greater.

This covenant is not currently in effect as the collateral securing our Senior Secured Notes has not been released.

12. CONVERTIBLE NOTES, NET

The following table details the net book value of our convertible senior notes, or Convertible Notes, on our consolidated

balance sheets ($ in thousands):

(1)Includes issuance costs that are amortized through interest expense over the life of the Convertible Notes using the

effective interest method.

(2)Represents the price of class A common stock per share based on a conversion rate of 27.5702 for the Convertible

Notes. The conversion rate represents the number of shares of class A common stock issuable per$1,000 principal

amount of Convertible Notes. The cumulative dividend threshold hasnot been exceeded as of September 30, 2026.

Other than as provided by the optional redemption provisions with respect to our Convertible Notes, we may not redeem

the Convertible Notes prior to maturity. The Convertible Notes are convertible at the holders’ option into shares of our

class A common stock, only under specific circumstances, prior to the close of business on December 14, 2026 at the

applicable conversion rate in effect on the conversion date. Thereafter, the Convertible Notes are convertible at the option

of the holder at any time until the second scheduled trading day immediately preceding the maturity date. The last reported

sale price of our class A common stock of$11.45 on September 30, 2026, the last trading day in thenine months ended

September 30, 2026, was less than the per share conversion price of the Convertible Notes.

The following table details our interest expense relatedto the Convertible Notes ($ in thousands):

Accrued interest payable for the Convertible Notes was$0.6 million and$4.3 million as of September 30, 2026 and

December 31, 2025, respectively. Refer to Note 2 for further discussion of our accounting policies for the Convertible

Notes.

13. DERIVATIVE FINANCIAL INSTRUMENTS

The objective of our use of derivative financial instruments is to minimize the risks and/or costs associated with our

investments and/or financing transactions. These derivatives may or may not qualify as net investment, cash flow, or fair

value hedges under the hedge accounting requirements of the ASC Topic 815, “Derivatives and Hedging.” Derivatives not

designated as hedges are not speculative and are used to manage our exposure to interest rate movements and other

identified risks. Refer to Note 2 for further discussion of the accounting for designated and non-designated hedges.

The use of derivative financial instruments involves certain risks, including the risk that the counterparties to these

contractual arrangements do not perform as agreed. To mitigate this risk, we only enter into derivative financial

instruments with counterparties that have appropriate credit ratings and are major financial institutions with which we and

our affiliates also have other financial relationships.

Net Investment Hedges of Foreign Currency Risk

Certain of our international investments expose us to fluctuations in foreign interest rates and currency exchange rates.

These fluctuations may impact the value of our cash receipts and payments in terms of our functional currency, the U.S.

dollar. We use foreign currency forward contracts to protect the value or fix the amount of certain investments or cash

flows in terms of the U.S. dollar.

Designated Hedges of Foreign Currency Risk

The following table details our outstanding foreign exchange derivatives that were designated as net investment hedges of

foreign currency risk (notional amounts in thousands):

Non-designated Hedges of Foreign Currency Risk

The following table details our outstanding foreign exchange derivatives that were non-designated hedges of foreign

currency risk (notional amounts in thousands):

Cash Flow Hedges of Interest Rate Risk

Certain of our financing transactions expose us to a fixed versus floating rate mismatch between our assets and liabilities.

We use derivative financial instruments, which include interest rate swaps (and may also include interest rate caps, interest

rate options, floors, and other interest rate derivative contracts) to hedge interest rate risk associated with our borrowings

where there is potential for an index mismatch.

The following table details our outstanding interest rate derivatives that were designated as cash flow hedges of interest rate

risk (notional amounts in thousands):

Fair Value Hedges of Interest Rate Risk

Certain of our corporate financings expose us to fluctuations in the fair value of our outstanding fixed rate debt. We use

derivative financial instruments, which include interest rate swaps, to hedge interest rate risk associated with changes in the

fair value of our fixed rate debt. The changes in the value of the interest rate swaps are recognized in earnings and offset

the corresponding changes in the fair value of the debt.

Designated Hedges of Interest Rate Risk

The following tables detail our outstanding interest rate derivatives that were designated as fair value hedges of interest rate

risk (notional amount in thousands):

The following tables detail the carrying amount and cumulative basis adjustments on hedged items designated as fair value

hedges ($ in thousands):

Non-designated Hedges of Interest Rate Risk

The following table details our outstanding interest rate derivatives that were not designated as hedges of interest rate risk

(notional amount in thousands):

There wereno non-designated interest rate derivatives outstanding as of December 31, 2025.

Financial Statement Impact of Hedges of Foreign Currency and Interest Rate Risks

The following table presents the effect of our derivative financial instruments on our consolidated statements of operations

(1)Represents (i) the forward points earned on our foreign currency forward contracts, which reflect the interest rate

differentials between the applicable base rate for our foreign currency investments and prevailing U.S. interest rates.

These forward contracts effectively convert the foreign currency rate exposure for such investments to

USD-equivalent interest rates, and (ii) the index rate movement in our non-designated interest rate hedges, which are

marked-to-market. Both are recognized in interest and related income in our consolidated statements of operations.

(2)Represents the financial statement impact of proceeds (payments) from periodic settlements related to our interest

rate swaps.

(3)Represents the spot rate movement in our non-designated foreign currency hedges, which are marked-to-market and

recognized in interest and related expenses in our consolidated statements of operations. The amounts in thenine

months ended September 30, 2025 also include a realized loss on an interest rate swap related to our Bank Loan

Portfolio Joint Venture that was entered into during the three months ended June 30, 2025 and subsequently

terminated.

Fair Value Hedges

The following table presents the net gains(losses)on derivatives and the related hedged items in fair value hedging

relationships ($ in thousands):

(1)Included within interest and related expenses presented in the consolidated statements of operations.

Valuation and Other Comprehensive Income

The following table summarizes the fair value of our derivative financial instruments ($ in thousands):

(1)Included in other assets in our consolidated balance sheets.

(2)Included in other liabilities in our consolidated balance sheets.

The following table presents the effect of our derivative financial instruments on our consolidated statements of

comprehensive income and operations ($ in thousands):

(1)During thethree and nine months ended September 30, 2026, wereceived net cash settlements of$31.3 million and

$8.8 million, respectively, on our foreign currency forward contr acts. Those amounts are included as a component of

accumulated other comprehensive income on our consolidated balance sheets.

(2)During thethree and nine months ended September 30, 2026, wereceived net cash settlements of$0.1 million and

$0.3 million, respectively, on our interest rate swaps. Those amounts are included within interest and related

expenses in the consolidated statements of operations.

(3)During thethree and nine months ended September 30, 2026, we recorded total interest and related expenses of

$216.2 million and$664.1 million, respectively, which was reduced by$16 thousand and$44 thousand,

respectively, related to income generated by our cash flow hedges.

There wereno cash flow hedges outstanding during thethree and nine months ended September 30, 2025.

Credit-Risk-Related Contingent Features

We have entered into agreements with certain of our derivative counterparties that contain provisions where if we were to

default on any of our indebtedness, including default where repayment of the indebtedness has not been accelerated by the

lender, we may also be declared in default on our derivative obligations. In addition, certain of our agreements with our

derivative counterparties require that we post collateral to secure net liability positions. As of September 30, 2026, we were

in a netasset position withone of our counterparties and in a liability position with our other counterparty related to our

foreign exchange hedges, and had$2.9 million of collateral posted with such counterparty. As of September 30, 2026, we

were in a net asset position withone of our counterparties and in a net liability position with our othertwo counterparties

related to ourinterest rate swaps and had$31.9 million of collateral posted with such counterparties. As of December 31,

2025, we were in a net asset position withone of our counterparties and in a net liability position with our othertwo

counterparties related to our foreign exchange hedges and had$25.3 million of collateral posted with such counterparties.

14. EQUITY

Stock and Stock Equivalents

Authorized Capital

As of September 30, 2026, we had the authority to issue up to 500,000,000 shares of stock, consisting of 400,000,000

shares of class A common stock and 100,000,000 shares of preferred stock. Subject to applicable NYSE listing

requirements, our board of directors is authorized to cause us to issue additional shares of authorized stock without

stockholder approval. In addition, to the extent not issued, currently authorized stock may be reclassified between class A

common stock and preferred stock. As of both September 30, 2026 and December 31, 2025, we didnot have any shares of

preferred stock issued and outstanding.

Share Repurchase Program

In October 2025, our board of directors authorized the repurchase of up to $150.0 million of shares of our class A common

stock under our repurchase program. Repurchases may be made from time to time in open market transactions, in privately

negotiated transactions, in agreements and arrangements structured in a manner consistent with Rules 10b-18 and 10b5-1

under the Exchange Act or otherwise. The timing and the actual amounts repurchased will depend on a variety of factors,

including legal requirements, price and economic and market conditions. The repurchase program may be changed,

suspended or discontinued at any time and does not have a specified expiration date.

During thenine months ended September 30, 2026, we repurchased 2,766,237 shares of class A common stock at a

weighted-average price per share of$14.39, for a total cost of$39.8 million. During thenine months ended September 30,

2025, we repurchased 2,653,583 shares of class A common stock at a weighted-average price per share of$17.97, for a

total cost of$47.7 million. As of September 30, 2026, the amount remaining available for repurchases under the program

was$109.8 million.

Class A Common Stock and Deferred Stock Units

Holders of shares of our class A common stock are entitled to vote on all matters submitted to a vote of stockholders and

are entitled to receive dividends authorized by our board of directors and declared by us, in all cases subject to the rights of

the holders of shares of outstanding preferred stock, if any.

We also issue restricted class A common stock under our stock-based incentive plans. Refer to Note 17 for further

discussion of these long-term incentive plans. In addition to our class A common stock, we also issue deferred stock units

to certain members of our board of directors for services rendered. These deferred stock units are non-voting, but carry the

right to receive dividends in the form of additional deferred stock units in an amount equivalent to the cash dividends paid

to holders of shares of class A common stock. Each vested deferred stock unit is settled by delivery of one share of class A

common stock upon the non-employee director’s separation from service.

The following table details the movement in our outstanding shares of class A common stock, including restricted class A

common stock and deferred stock units:

(1)Includes 379,690 and 331,611 deferred stock units held by members of our board of directors as of September 30,

2026 and 2025, respectively.

(2)Represents shares issued under our dividend reinvestment program during thenine months ended September 30,

(3)Includes 32,985 and 29,140 shares of restricted class A common stock issued to our board of directors during the

nine months ended September 30, 2026 and 2025, respectively.

(4)Net of 27,534 and 43,832 shares of restricted class A common stock forfeited under our stock-based incentive plans

during thenine months ended September 30, 2026 and 2025, respectively.

Dividend Reinvestment and Direct Stock Purchase Plan

We have adopted a dividend reinvestment and direct stock purchase plan under which an aggregate of 10,000,000 shares of

class A common stock are available for sale. Under the dividend reinvestment component of the plan, our class A common

stockholders can designate all or a portion of their cash dividends to be reinvested in additional shares of class A common

stock. Such shares may, at our option, be newly issued shares from us, shares purchased by the plan administrator on the

open market, or a combination thereof. The direct stock purchase component of the plan allows stockholders and new

investors, subject to our approval, to purchase shares of class A common stock directly from us. During thenine months

ended September 30, 2026,26,653 shares of class A common stock were purchased on the open market by the plan

administrator under the dividend reinvestment component of the plan. During thenine months ended September 30, 2025,

weissued 1,778 shares of class A common stock and 652 shares of class A common stock were purchased on the open

market by the plan administrator under the dividend reinvestment component of the plan. As of September 30, 2026, a total

of 9,938,472 shares of class A common stock remained available under the dividend reinvestment and direct stock

purchase plan.

At the Market Stock Offering Program

As of September 30, 2026, we are party toseven equity distribution agreements, or ATM Agreements, pursuant to which

we may sell, from time to time, up to an aggregate sales price of$699.1 million of our class A common stock. Sales of

class A common stock made pursuant to our ATM Agreements may be made in negotiated transactions or transactions that

are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended. Actual

sales depend on a variety of factors including market conditions, the trading price of our class A common stock, our capital

needs, and our determination of the appropriate sources of funding to meet such needs. During thenine months ended

September 30, 2026 and 2025, we didnot issue any shares of our class A common stock under ATM Agreements. As of

September 30, 2026, shares of our class A common stock with an aggregate sales price of$480.9 million remained

available for issuance and sale under our ATM Agreements.

Dividends

We generally intend to distribute substantially all of our taxable income, which does not necessarily equal net income as

calculated in accordance with GAAP, to our stockholders each year to comply with the REIT provisions of the Internal

Revenue Code of 1986, as amended, or the Internal Revenue Code. Our dividend policy remains subject to revision at the

discretion of our board of directors. All distributions will be made at the discretion of our board of directors and will

depend upon our taxable income, our financial condition, our maintenance of REIT status, applicable law, and other factors

as our board of directors deems relevant.

On September 15, 2026, we declared a dividend of $0.47 per share, or$78.0 million in aggregate, that was paid on October

15, 2026 to stockholders of record as of September 30, 2026.

The following table details our dividend activity ($ in thousands, except per share data):

Earnings Per Share

We calculate our basic and diluted earnings per share using the two-class method for all periods presented as the unvested

shares of our restricted class A common stock qualify as participating securities, as defined by GAAP. These restricted

shares have the same rights as our other shares of class A common stock, including participating in any dividends, and

therefore have been included in our basic and diluted net income per share calculation. The shares issuable under our

Convertible Notes are included in diluted earnings per share using the if-converted method when the effect is not

antidilutive.

The following table sets forth the calculation of basic and dilutednet (loss) income per share of class A common stock

based on the weighted-average of both restricted and unrestricted class A common stock outstanding ($ in thousands,

except per share data):

(1)Representsnet (loss) income attributable to Blackstone Mortgage Trust, Inc.

(2)For both thethree and nine months ended September 30, 2026 and 2025, our Convertible Notes were not included in

the calculation of diluted earnings per share, as the impact is antidilutive. Refer to Note 12 for further discussion of

our convertible notes.

Other Balance Sheet Items

Accumulated Other Comprehensive Income

As of September 30, 2026, total accumulated other comprehensive income was$21.7 million, representing$125.5 million

of net realized and unrealized gains related to changes in the fair value of derivative instruments and$9.6 million of

unrealized gains related to the changes in the fair value of derivative instruments held by unconsolidated entities, offset by

$113.4 million of cumulative unrealized currency translation adjustments on assets and liabilities denominated in foreign

currencies. As of December 31, 2025, total accumulated other comprehensive income was$12.1 million, primarily

representing$86.6 million of net realized and unrealized gains related to changes in the fair value of derivative instruments

offset by$73.6 million of cumulative unrealized currency translation adjustments on assets and liabilities denominated in

foreign currencies and$0.8 million of unrealized losses related to the changes in the fair value of derivative instruments

held by unconsolidated entities.

Non-Controlling Interests

The non-controlling interests included on our consolidated balance sheets represent the equity interests in our Multifamily

Joint Venture that are not owned by us. A portion of our Multifamily Joint Venture’s consolidated equity and results of

operations are allocated to these non-controlling interests based on their pro rata ownership of our Multifamily Joint

Venture. As of September 30, 2026, our Multifamily Joint Venture’s total equity was$13.8 million, of which$11.7 million

was owned by us, and$2.1 million was allocated to non-controlling interests. As of December 31, 2025, our Multifamily

Joint Venture’s total equity was$36.5 million, of which$31.0 million was owned by us, and$5.5 million was allocated to

non-controlling interests.

15. OTHER EXPENSES

Our other expenses consist of the management and incentive fees we pay to our Manager and our general and

administrative expenses.

Management and Incentive Fees

Pursuant to a management agreement betweenour Manager and us, or our Management Agreement, our Manager earns a

base management fee in an amount equal to 1.50% per annum multiplied by our Equity, as defined in the Management

Agreement. In addition, our Manager is entitled to an incentive fee in an amount equal to the product of (i)20% and (ii) the

excess of (a) our Core Earnings (as defined in our Management Agreement) for the previous 12-month period over (b) an

amount equal to 7.00% per annum multiplied by our Equity, provided that our Core Earnings over the prior three-year

period is greater than zero. Core Earnings, as defined in our Management Agreement, is generally equal to our GAAP net

income (loss), including realized gains and losses not otherwise recognized in current period GAAP net income (loss), and

excluding (i) non-cash equity compensation expense, (ii) depreciation and amortization, (iii) unrealized gains (losses), (iv)

net income (loss) attributable to our legacy portfolio, (v) certain non-cash items, and (vi) incentive management fees.

During thethree and nine months ended September 30, 2026, we incurred $14.5 million and$43.9 million, respectively, of

management fees payable to our Manager compared with$16.8 million and$51.1 million, respectively, during the same

periods in 2025. During thethree and nine months ended September 30, 2026 and 2025, we didnot incur any incentive fees

payable to our Manager.

As of September 30, 2026 and December 31, 2025, we had accrued management fees payable to our Manager of

$14.5 million and$16.4 million, respectively.

General and Administrative Expenses

General and admin istrative expenses consisted of the following ($ in thousands):

16. INCOME TAXES

We have elected to be taxed as a REIT under the Internal Revenue Code for U.S. federal income tax purposes. We

generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any

net capital gain, in order for U.S. federal income tax not to apply to our earnings. To the extent that we satisfy this

distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income

tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual

amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal

tax laws.

Our qualification as a REIT also depends on our ability to meet various other requirements imposed by the Internal

Revenue Code, which relate to organizational structure, diversity of stock ownership, and certain restrictions with regard to

the nature of our assets and the sources of our income. Even if we qualify as a REIT, we may be subject to certain U.S.

federal income and excise taxes and state and local taxes on our income and assets. If we fail to maintain our qualification

as a REIT for any taxable year, we may be subject to material penalties as well as federal, state, and local income tax on

our taxable income at regular corporate rates and we would not be able to qualify as a REIT for the subsequent four full

taxable years. As of September 30, 2026 and December 31, 2025, we were in compliance with all REIT requirements.

Securitization transactions could result in the creation of taxable mortgage pools for federal income tax purposes. As a

REIT, so long as we own 100% of the equity interests in a taxable mortgage pool, we generally would not be adversely

affected by the characterization of the securitization as a taxable mortgage pool. Certain categories of stockholders,

however, such as foreign stockholders eligible for treaty or other benefits, stockholders with net operating losses, and

certain tax-exempt stockholders that are subject to unrelated business income tax, or UBTI, could be subject to increased

taxes on a portion of their dividend income from us that is attributable to the taxable mortgage pool. We have not made

UBTI distributions to our common stockholders and do not intend to make such UBTI distributions in the future.

During thethree and nine months ended September 30, 2026, we recorded a current income tax provision of$1.3 million

and$4.9 million, respectively, compared with$1.5 million and$3.1 million, respectively, during the same periods of 2025,

all of which primarily related to activities of our U.S. and foreign taxable subsidiaries and various state and local taxes. We

didnot have any deferred tax assets or liabilities as of September 30, 2026 or December 31, 2025.

We have net operating losses, or NOLs, generated by our predecessor business that may be carried forward and utilized in

current or future periods. As a result of our issuance of 25,875,000 shares of class A common stock in May 2013, the

availability of our NOLs is generally limited to$2.0 million per annum by change of control provisions promulgated by the

Internal Revenue Service with respect to the ownership of Blackstone Mortgage Trust. As of September 30, 2026, we had

estimated NOLs of$159.0 million that will expire in 2029, unless they are utilized by us prior to expiration. Previously, we

recorded a full valuation allowance against such NOLs as we expected that they would expire unutilized. However,

although uncertain, we may utilize a portion of NOLs prior to expiration. We do not expect the utilization of NOLs to have

a material impact on our consolidated financial statements. We have recorded a full valuation allowance against such NOLs

as it is probable that they will expire unutilized.

As of September 30, 2026, tax years 2022 through 2025 remain subject to examination by taxing authorities.

17. STOCK-BASED INCENTIVE PLANS

We are externally managed by our Manager and do not currently have any employees. However, as of September 30, 2026,

our Manager, certain individuals employed by an affiliate of our Manager, and certain members of our board of directors

were compensated, in part, through our issuance of stock-based instruments.

Under ourtwo current stock incentive plans, a maximum of 10,400,000 shares of our class A common stock may be issued

to our Manager, our directors and officers, and certain employees of affiliates of our Manager. As of September 30, 2026,

there were 4,540,172 shares available under our current stock incentive plans.

The following table details the movement in our outstanding shares of restricted class A common stock and the weighted-

average grant date fair value per share:

These shares generally vest in installments over a period ofthree years, pursuant to the terms of the respective award

agreements and the terms of our current stock incentive plans. The 1,681,917 shares of restricted class A common stock

outstanding as of September 30, 2026 will vest as follows:318,352 shares will vest in 2026;901,071 shares will vest in

2027; and 462,494 shares will vest in 2028. As of September 30, 2026, total unrecognized compensation cost relating to

unvested share-based compensation arrangements was$31.7 million based on the grant date fair value of shares granted.

This cost is expected to be recognized over a weighted-average period of 1.0 years from September 30, 2026.

18. FAIR VALUE MEASUREMENTS

Assets and Liabilities Measured at Fair Value

The following table summarizes our assets and liabilities measured at fair value on a recurring and nonrecurring basis ($ in

thousands):

(1)Measured at fair value on a nonrecurring basis. Loans held-for-sale are carried at the lower of amortized cost or fair

value.

This table excludes$151.5 million and$111.0 million of investments in unconsolidated entities that are measured at fair

value using net asset value as a practical expedient and not classified in the fair value hierarchy as of September 30, 2026

and December 31, 2025, respectively. Refer to Note 5 for further information.

Our investments in debt securities are measured at fair value on a recurring basis and are classified as Level 3 in the fair

value hierarchy. As of September 30, 2026, we determined that the recent purchase prices remained representative of fair

value and, accordingly, no fair value adjustment had been recorded.

Certain of our assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments under

certain circumstances and, therefore, are measured at fair value on a nonrecurring basis. As of September 30, 2026, loans

receivable, held-for-sale with a carrying value of$615.6 million were measured at fair value on a nonrecurring basis and

classified as Level 3 within the fair value hierarchy. Fair value was determined using the executed purchase agreement,

considering estimated costs to sell. Refer to Note 3 for further discussion on loans receivable, held-for-sale. Refer to Note 2

for further discussion regarding impairment of owned real estate assets, which are measured at fair value on a nonrecurring

basis.

Refer to Note 2 for further discussion regarding fair value measurement.

Fair Value of Financial Instruments

As discussed in Note 2, GAAP requires disclosure of fair value information about financial instruments, whether or not

recognized at fair value in the statement of financial position, for which it is practicable to estimate that value.

The following table details the book value, face amount, and fair value of the financial instruments described in Note 2

(1)Included within other liabilities on our consolidated balance sheets. See Note 6 for further information.

Estimates of fair value for cash and cash equivalents and convertible notes are measured using observable, quoted market

prices, or Level 1 inputs. Estimates of fair value for securitized debt obligations, the Term Loans, and the Senior Secured

Notes are measured using observable, quoted market prices, in inactive markets, or Level 2 inputs. All other fair value

significant estimates are measured using unobservable inputs, or Level 3 inputs. See Note 2 for further discussion regarding

fair value measurement of certain of our assets and liabilities.

19. VARIABLE INTEREST ENTITIES

We have financed a portion of our loans through the CLOs and the European Loan Securitization, all of which are VIEs.

We are the primary beneficiary of, and therefore consolidate, the CLOs and the European Loan Securitization on our

balance sheet as we (i) control the relevant interests of the CLOs and the European Loan Securitization that give us power

to direct the activities that most significantly affect the CLOs and the European Loan Securitization, and (ii) have the right

to receive benefits and obligation to absorb losses of the CLOs and the European Loan Securitization through the

subordinate interests we own.

During 2025, we modified three loans that included, among other changes, control over decision-making at the respective

properties. Similarly, during 2024, we modifiedtwo other loans that included, among other changes, an equity interest in

and/or control over decision-making at the property. As a result of these modifications, our investments in these loans are

VIEs. As of September 30, 2026, we are the primary beneficiary of, and therefore consolidated the assets of these VIEs on

our balance sheet as we (i) have the power to direct the activities that most significantly affect the property, and (ii) have

the right to receive excess sale proceeds upon exit.

The following table details the assets and liabilities of our consolidated VIEs ($ in thousands):

Assets held by these VIEs are restricted and can be used only to settle obligations of the VIEs, including the subordinate

interests of the securitized debt obligations owned by us. The liabilities of these VIEs are non-recourse to us and can only

be satisfied from the assets of the VIEs. The consolidation of these VIEs results in an increase in our gross assets,

liabilities, revenues and expenses; however, it does not affect our stockholders’ equity or net income. We are not obligated

to provide, have not provided, and do not intend to provide material financial support to these consolidated VIEs.

20. TRANSACTIONS WITH RELATED PARTIES

Our Manager

We are managed by our Manager pursuant to the Management Agreement. The current term of the Management

Agreement expires on December 19,2026, and it will be automatically renewed for aone-year term upon such date and

each anniversary thereafter unless earlier terminated.

As of September 30, 2026 and December 31, 2025, our consolidated balance sheets included$14.5 million and

$16.4 million, respectively, of accrued management fees payable to our Manager. During thethree and nine months ended

September 30, 2026, we paid management fees of$14.6 million and$45.9 million, respectively, to our Manager, compared

to$17.0 million and$52.8 million, respectively, during the same periods in 2025. We didnot pay any incentive fees to our

Manager during thethree and nine months ended September 30, 2026 and 2025. In addition, during thethree and nine

months ended September 30, 2026, we incurred expenses of$1.8 million and $2.6 million, respectively, that were paid by

our Manager and have been or will be reimbursed by us, compared to$0.4 million and$0.9 million, respectively, of such

expenses during the same periods in 2025.

As of September 30, 2026, our Manager held 840,503 shares of unvested restricted class A common stock, which had an

aggregate grant date fair value of$17.0 million. These shares vest in installments over three years from the date of

issuance. During thethree and nine months ended September 30, 2026, we recorded non-cash expenses related to shares

held by our Manager of$3.5 million and$10.5 million, respectively, compared to$3.6 million and$10.9 million,

respectively, during the same periods in 2025. Refer to Note 17 for further details on our restricted class A common stock.

As of September 30, 2026, our Manager, its affiliates (including Blackstone and Blackstone-advised investment vehicles),

Blackstone employees, and our directors held an aggregate 13,754,343 shares, or 8.3%, of our class A common stock, of

which 8,916,412 shares, or 5.4%, were held by Blackstone and its subsidiaries. Additionally, our directors held 379,690

deferred stock units as of September 30, 2026. Certain of the parties listed above have in the past purchased or sold shares

of our class A common stock in open market transactions, and such parties may in the future purchase or sell additional

shares of our class A common stock and/or engage in derivatives transactions related to our class A common stock. Any

such transactions would be made in the sole discretion of the relevant party based on market conditions and other

considerations relevant to such parties.

Affiliate Services

We have engaged certain portfolio companies owned by Blackstone-advised investment vehicles to provide, as applicable,

management, corporate support, and transaction support services. The following table details the costs incurred (refunded)

for these services ($ in thousands):

(1)Provides loan origination services related to certain of our investments.

During thenine months ended September 30, 2026, we entered into an agreement with another Blackstone-advised

investment vehicle to fund our pro rata share of any payments required under a guaranty agreement with a lending

institution. The guaranty relates to a revolving credit facility with a portfolio company owned by Blackstone-advised

investment vehicles that provides services to us, and our participation reflects our share of the associated costs based on

services rendered. As of September 30, 2026, our maximum potential obligation under the arrangement was$0.9 million.

No events through the date of these consolidated financial statements required performance under the guaranty, and no

liability was recorded as of September 30, 2026.

We have engaged other affiliates of our Manager to provide various services. The following table details the costs incurred

for these services ($ in thousands):

(1)In order to provide insurance for our owned real estate assets, we became a member of Gryphon Mutual Property

Americas IC, or Gryphon, a captive insurance company owned by us and other Blackstone-advised investment

vehicles. A Blackstone affiliate provides oversight and management services to Gryphon and receives fees based on

a percentage of premiums paid for such policies. The fees and expenses of Gryphon, including insurance premiums

and fees paid to its manager, are borne by us and the other Blackstone-advised investment vehicles that are members

of Gryphon pro rata based on insurance premiums paid for each member’s respective properties. During thenine

months ended September 30, 2026 and 2025, we paid$2.9 million and$1.4 million, respectively, to Gryphon for

insurance costs, inclusive of premiums, capital surplus contributions, taxes, and our pro rata share of other expenses.

Of these amounts,$0.1 million was attributable to the fees paid to a Blackstone affiliate to provide oversight and

management services to Gryphon for both thenine months ended September 30, 2026 and 2025. The amounts

included in the table above reflect the amortization of the insurance expense over the relevant periods of the

respective policies.

(2)During thenine months ended September 30, 2026, Blackstone Securities Partners L.P., or BSP, an affiliate of our

Manager, was engaged as a member of the syndicate for our May 2026 Senior Secured Notes. During thenine

months ended September 30, 2025, BSP was also engaged as a member of the syndicate for our B-6 Term Loan and

our B-7 Term Loan. These engagements were on terms equivalent to those of unaffiliated third parties.

(3)Lexington National Land Services, or LNLS, is a Blackstone affiliate that (i) acts as a title agent in facilitating and

issuing title insurance, (ii) provides title support services for title insurance underwriters, (iii) in certain

circumstances, provides courtesy title settlement services and (iv) acts as escrow agent in connection with certain

investments by Blackstone-advised vehicles, including us, Blackstone-advised investment vehicles and portfolio

companies owned by Blackstone-advised investment vehicles, affiliates and related parties, and third parties,

including, in certain cases, Blackstone’s borrowers. In exchange for such services, LNLS earns fees which would

have otherwise been paid to third parties. Blackstone receives distributions from LNLS in connection with

investments made by us based on its equity interest in LNLS. In each case, there will be no related expense offset to

us.

CT Investment Management Co., LLC, or CTIMCO, serves as the special servicer of all of our CLOs, and the Manager

serves as the collateral manager and benchmark agent for our FL6 and FL5 CLOs issued in the first quarter of 2026 and

2025, respectively. As of September 30, 2026, three of our assets were in special servicing under CLOs. CTIMCO and our

Manager have waived any fees that would be payable to a third party serving in such roles pursuant to the applicable

agreements, and no such fees have been paid or will become payable to CTIMCO or our Manager.

Other Transactions

During thenine months ended September 30, 2026, we invested$502.6 million infour senior loans,$32.6 million intwo

mezzanine loans to unaffiliated third parties, and$144.4 million in debt securities (see Note 6 for further discussion) in

which Blackstone-advised investment vehicles also invested at the same level of the capital structure on a pari passu basis.

Included in the$144.4 million of debt securities investments discussed above, in the third quarter of 2026, we purchased

$50.0 million of senior secured notes in a$3.9 billion issuance by a portfolio company owned by other Blackstone-advised

investment vehicles. The notes were acquired on terms equivalent with those of unaffiliated third-party purchasers of the

notes. We have forgone all non-economic rights under these notes, including voting rights, so long as the issuer is owned

by a Blackstone-advised investment vehicle.

In the first quarter of 2026, Blackstone-advised investment vehicles acquired an aggregate$71.4 million participation in

our$770.8 million B-9 Term Loan. In the fourth quarter of 2025, Blackstone-advised investment vehicles acquired an

aggregate$63.0 million participation in our$700.0 million B-8 Term Loan. In the third quarter of 2025, Blackstone-

advised investment vehicles acquired an aggregate$33.0 million participation in our$453.1 million B-7 Term Loan. In the

second quarter of 2025, Blackstone-advised investment vehicles acquired an aggregate$83.9 million participation in our

$1.0 billion B-6 Term Loan, which has subsequently been repaid in full. All of these transactions were part of broad

syndications led by third-party banks, and were on terms equivalent to those of unaffiliated third parties. BSP was engaged

as a member of the syndicate for these transactions. Our engagements of BSP are on terms equivalent to those of

unaffiliated third parties. See “—Affiliate Services” for further information.

As part of broad syndications led by third-party banks, Blackstone-advised investment vehicles acquired an aggregate

$11.0 million of notes in our$1.0 billion FL6 CLO offering in the first quarter of 2026, and$75.0 million of notes in our

$1.0 billion FL5 CLO offering in the first quarter of 2025. Both of these transactions were on terms equivalent to those of

unaffiliated third parties.

In the second quarter of 2026, we entered into our Homebuilder Finance Joint Venture with an unaffiliated third party,

alongside a Blackstone-advised investment vehicle, that concurrently acquired a$286.7 million portfolio of single family

construction loans in which we made an equity investment of$28.5 million representing our aggregate ownership interest

of 45%.

In the fourth quarter of 2025, we made a$75.0 million capital commitment at the initial closing of a fund managed by

Blackstone Real Estate Debt Strategies, or BREDS, or the BREDS-advised private fund, formed to invest in Core+ real

estate debt investments in the U.S. and Canada. Blackstone affiliates, including us, do not pay management fees or carried

interest with respect to their investments in the BREDS-advised private fund. Our capital commitment represented a

minority of the total capital commitments the BREDS-advised private fund had received as of September 30, 2026. As of

September 30, 2026, the BREDS-advised private fund had not called any capital. To fund its investments, the BREDS-

advised private fund will draw down on capital commitments made by its investors, including us, on a pro rata basis.

In the second quarter of 2025, we entered into our Bank Loan Portfolio Joint Venture with a Blackstone-advised

investment vehicle that concurrently acquired a$1.4 billion portfolio of performing commercial mortgage loans in which

we made an equity investment of$57.6 million and our ownership interest was 29%. In the third quarter of 2025, our Bank

Loan Portfolio Joint Venture acquired a$606.0 million portfolio of performing commercial mortgage loans in which we

made an equity investment of$44.7 million and our ownership interest was 50%. In the fourth quarter of 2024, we entered

into our Net Lease Joint Venture with a Blackstone-advised investment vehicle to invest in triple net lease properties.

We do not consolidate our Bank Loan Portfolio Joint Venture, our Net Lease Joint Venture, our Homebuilder Finance Joint

Venture, or the BREDS-advised private fund, as we do not have a controlling financial interest. As of September 30, 2026,

the aggregate value of our equity investment in our Bank Loan Portfolio Joint Venture was$92.3 million and our

ownership interest was 35%, and the aggregate value of our equity investment in our Net Lease Joint Venture was

$219.3 million and our ownership interest was 75%. As of September 30, 2026, we had not made an equity investment in

the BREDS-advised private fund. We, these joint ventures, these Blackstone-advised investment vehicles, and other

Blackstone affiliates have engaged and may in the future engage in certain investment, financing, derivative and/or hedging

arrangements related to these unconsolidated entities.

In the second quarter of 2026, one of our senior loans to a borrower controlled by Blackstone-advised investment vehicles

was modified. The terms of the modification (including, among other changes, an extension of the maturity date, a

reduction in the contractual interest rate, and a meaningful additional commitment and credit support from the borrower)

were negotiated by our third-party co-lenders. We continue to forgo all non-economic rights under the loan, including

voting rights, so long as the Blackstone-advised investment vehicles control the borrower.

21. COMMITMENTS AND CONTINGENCIES

Unfunded Commitments Under Loans Receivable

As of September 30, 2026, we had aggregate unfunded commitments of$951.0 million across 47 loans receivable, and

$539.6 million of committed or identified financings for those commitments, resulting in net unfunded commitments of

$411.4 million. The unfunded commitments above include $35.6 million related tofive loans receivable, held-for-sale that

were sold subsequent to September 30, 2026. The unfunded loan commitments comprise funding for capital expenditures

and construction, leasing costs, and interest and carry costs. Loan funding commitments are generally subject to certain

conditions, including, without limitation, the progress of capital projects, leasing, and cash flows at the properties securing

our loans. Therefore, the exact timing and amounts of such future loan fundings are uncertain and will depend on the

current and future performance of the underlying collateral assets. We expect to fund our loan commitments over the

remaining term of the related loans, which have a weighted-average future funding period of 1.6 years.

Principal Debt Repayments

Our contractual principal debt repayments as of September 30, 2026 were as follows ($ in thousands):

(1)Our secured debt and asset-specific debt agreements are generally term-matched to their underlying collateral.

Therefore, the allocation of payments under such agreements is generally based on the maximum maturity date of

the collateral loans, assuming all extension options are exercised by the borrower. In limited instances, the maturity

date of the respective debt agreement is used.

(2)The Term Loans are partially amortizing, with an amount equal to 1.0% per annum of the initial principal balance

due in quarterly installments. Refer to Note 10 for further details on our Term Loans.

(3)Reflects the outstanding principal balance of Convertible Notes, excluding any potential conversion premium. Refer

to Note 12 for further details on our Convertible Notes.

(4)Amounts are included in other liabilities on our consolidated balance sheets.

(5)Total does not include$2.7 billion of consolidated securitized debt obligations, as the satisfaction of these liabilities

will not require cash outlays from us.

Board of Directors’ Compensation

As of September 30, 2026, ourseven non-employee directors are entitled to annual compensation of$210,000 each, of

which$95,000 is paid in cash and$115,000 is paid in the form of deferred stock units or, at their election, shares of

restricted common stock. As of September 30, 2026, the othertwo board members are employees of affiliates of our

Manager who also serve as executive officers and they are not compensated by us for their service as directors. In addition,

(i) the lead independent director receives additional annual cash compensation of$30,000, (ii) the chairs of our audit,

compensation, and corporate governance committees receive additional annual cash compensation of$20,000,$15,000,

and$10,000, respectively, and (iii) the members of our audit and investment risk management committees receive

additional annual cash compensation of$10,000 and$7,500, respectively.

Litigation

From time to time, we may be involved in various claims and legal actions arising in the ordinary course of business. As of

September 30, 2026, we were not involved in any material legal proceedings.

22. SEGMENT REPORTING

Operating segments are defined as components of a business that can earn revenues and incur expenses for which discrete

financial information is available that is evaluated on a regular basis by the chief operating decision maker, or CODM. Our

CODM is, collectively, our Chief Executive Officer and Chief Financial Officer, who decide how to allocate resources and

assess performance. A single management team reports to the CODM, who manages the entire business.

We have determined that we haveone reportable segment based on how the CODM reviews and manages the business,

which originates and acquires commercial mortgage loans and related investments.

Our CODM reviews, among other things, consolidated net income (loss) that is reported on the consolidated statements of

operations to make decisions, allocate resources and assess performance and does not evaluate the net income (loss) from

any separate geography or product line. The measure of segment assets is reported on the consolidated balance sheets as

total consolidated assets.