Franklin BSP Realty Trust, Inc.
For the period ended Jun 30, 2025. Filed Jul 30, 2025.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Jun 30, 2025 · Filed Jul 30, 2025
FBRT$6.20-1.3%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2025-03-31; filed 2025-04-28.
0001562528-25-000019
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-06-30; filed 2025-07-30.
0001562528-25-000030
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 208 previous paragraphs and 228 current paragraphs.
140 unchanged; 58 reworded; 28 added; 6 removed; 4 previous and 2 current paragraphs rearranged.
Tables are not compared: 20 previous and 21 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (28)
Current report
NewPoint Acquisition
Current report
As discussed in “Note 16 - Subsequent Events”, on July 1, 2025, we completed the acquisition of NewPoint. NewPoint is a commercial real estate finance company focused on originating and servicing agency mortgage loans. NewPoint is a multifamily originator and servicer and is approved by four government sponsored entities (Federal National Mortgage Association, Federal Home Loan Mortgage Corporation, Government National Mortgage Association and U.S. Department of Housing and Urban Development). As of the closing date of the acquisition, NewPoint’s mortgage servicing rights ("MSRs") will be held as an asset on our consolidated balance sheet. As of June 30, 2025, and, as of the closing date of the acquisition, NewPoint had a total servicing portfolio of $55.4 billion. We expect that the NewPoint business will be complimentary to our historical business and will offer our traditional bridge loan borrowers the opportunity to refinance our bridge loans with agency mortgage loans.
Current report
The NewPoint acquisition will not have any impact on our arrangements with the Advisor, and our officers, all employees of the Advisor, will oversee and manage the officers and employees of NewPoint.
Current report
As a result of the NewPoint acquisition, starting in the third quarter of 2025, we expect to treat the associated agency mortgage business, which focuses on originating and servicing agency mortgage loans, as a new business segment. We expect that the agency business will have a number of impacts on our future consolidated financial statements, including the addition of MSRs to our consolidated balance sheet, the addition of servicing income and gains on sales of originated agency mortgages, and the addition of employee expense. These changes may make it difficult to compare our financial results in future periods with our financial results from periods that preceded the acquisition. In addition, gains on sale from originated agency mortgages will largely be driven by origination volumes in the reported period. As a result, the associated gains on sale may vary significantly quarter to quarter, which may make it difficult to compare future quarter to quarter financial results.
Current report
With respect to liquidity, we expect the agency business will continue to utilize warehouse agreements as the primary form of financing. The warehouse agreements used for the agency business are expected to have significantly higher advance rates than the repurchase and warehouse agreements we use for our commercial mortgage origination business. We also expect that the MSRs we will hold on our balance sheet will increase our ability to expand our revolving credit facilities.
Current report
We issued 8,385,951 Class A Units of FBRT OP LLC, a consolidated subsidiary of the Company, to equity holders of NewPoint in the acquisition. After 12 months from the closing date, holders of the Class A Units may elect to have the Class A Units redeemed, in which case the Company will have the option to satisfy the redemption consideration with either cash (based on the trading price of the Company’s common stock) or the delivery of one share of the Company’s common stock for each Class A Unit. We expect to pay quarterly per unit cash distributions to holders of Class A Units equal to the quarterly per share cash distributions we pay to holders of our common stock.
Current report
New Tax Legislation
Current report
Effective July 4, 2025, certain changes to U.S. tax law were approved that impact us and our stockholders. Among other changes, this legislation (i) permanently extended the 20% deduction for “qualified REIT dividends” for individuals and other non-corporate taxpayers under Section 199A of the Internal Revenue Code (the “Code”), (ii) increased the percentage limit under the REIT asset test applicable to taxable REIT subsidiaries (“TRSs”) from 20% to 25% for taxable years beginning after December 31, 2025, and (iii) increased the base on which the 30% interest deduction limit under Section 163(j) of the Code applies by excluding depreciation, amortization and depletion from the definition of “adjusted taxable income” (i.e. based on EBITDA rather than EBIT) for taxable years beginning after December 31, 2024.
Current report
The following table shows selected data from our equity method investments, in our portfolio as of June 30, 2025 (dollars in thousands):
Current report
In addition, following the NewPoint acquisition, which closed on July 1, 2025, the Company will also have an agency business which focuses on originating and servicing agency mortgage loans.
Current report
Comparison of the Six Months Ended June 30, 2025 to the Six Months Ended June 30, 2024
Current report
Benefit for credit losses was $3.4 million during the six months ended June 30, 2025 compared to a provision of $35.1 million during the six months ended June 30, 2024.
Current report
For the six months ended June 30, 2025, general benefit for credit losses was $4.2 million compared to a provision of $2.1 million during the six months ended June 30, 2024. General benefit for the six months ended June 30, 2025 is primarily due to a decrease in the size of the overall portfolio. General provision for the six months ended June 30, 2024 was attributable to a more pessimistic view of the macroeconomic scenario utilized for the CECL model compared to preceding periods.
Current report
Realized gain on real estate securities, available for sale for the six months ended June 30, 2025 was $0.1 million related to eight sales of our CRE CLO bonds. This is compared to a gain of $0.1 million for the six months ended June 30, 2024 related to four sales of our CRE CLO bonds.
Current report
Gain on other real estate investments for the six months ended June 30, 2025 was $0.5 million primarily due to the sales and settled litigation regarding the Walgreens Portfolio, partially offset by losses related to the onboarding of real estate owned, held for sale, multifamily and office properties, as well as fair value write downs on two of our multifamily properties. This is compared to a loss of $6.2 million for the six months ended June 30, 2024 primarily due to sales and write offs related to the Walgreens Portfolio coupled with the onboarding of real estate owned, held for sale, multifamily properties.
Current report
Income/(loss) from equity method investments
Current report
Income from equity method investments for the six months ended June 30, 2025 was $0.2 million related to the Company's allocated percentage of quarterly income for a mixed use property located in New Jersey. The Company did not have any equity method investments or income during the six months ended June 30, 2024.
Current report
Interest expense for the three months ended June 30, 2025 and March 31, 2025 totaled $70.2 million and $70.6 million, respectively, a decrease of $0.4 million. The decrease was primarily due to a decrease of $240.2 million in the average carrying balance of our collateralized loan obligations. SOFR rates remained consistent quarter over quarter.
Current report
For the three months ended June 30, 2025 and March 31, 2025, revenue from real estate owned was $8.3 million and $6.8 million, respectively. The $1.5 million increase was primarily the result of rental income from obtaining possession of an additional multifamily property brought on as real estate owned during the quarter, coupled with an increase of rental income from an office property we obtained possession of towards the end of the prior quarter.
Current report
Benefit for credit losses was $1.5 million and $1.9 million, respectively, during the three months ended June 30, 2025 and March 31, 2025.
Current report
Income/(loss) from equity method investments
Current report
Income from equity method investments for the three months ended June 30, 2025 was $0.2 million related to the Company's allocated percentage of quarterly income for a mixed use property located in New Jersey. The Company did not recognize income from equity method investments during the three months ended March 31, 2025.
Current report
The Company has determined to present the results of operations for the most recent quarter compared to the immediately preceding sequential quarter, along with the current year-to-date results compared to prior year-to-date results, for purposes of providing an analysis of material changes in our results of operations. The Company no longer presents the results of operations for the most recent quarter compared to the prior year quarter as the Company does not believe it provides investors incrementally useful information.
Current report
Refer to "NewPoint Acquisition" above for a discussion of the anticipated impacts of the NewPoint acquisition on our financial results and liquidity.
Current report
(2)On July 1, 2025 the Company closed on the acquisition of NewPoint Holdings JV LLC.
Current report
During the six months ended June 30, 2024, the maximum average outstanding balance was $1.0 billion, of which $0.8 billion was related to repurchase agreements on our commercial mortgage loans and $0.2 billion for repurchase agreements on our real estate securities.
Current report
Refer to "NewPoint Acquisition" above with respect to the expected distributions associated with the Class A units issued in the acquisition.
Current report
Refer to the "NewPoint Acquisition" above with respect to the expected distributions associated with the Class A units issued in the acquisition.
Removed paragraphs (6)
Previous report
Interest income for the three months ended March 31, 2025 and 2024 totaled $113.9 million and $130.6 million, respectively, a decrease of $16.7 million. This decrease was primarily due to an approximate 99 basis point decrease in
Previous report
Interest expense for the three months ended March 31, 2025 and 2024 totaled $70.6 million and $81.3 million, respectively, a decrease of $10.7 million. The decrease was primarily due to an approximate 99 basis point decrease in daily average SOFR and SOFR equivalent rates coupled with a decrease of $181.1 million in the average carrying balance of our collateralized loan obligations.
Previous report
Benefit for credit losses was $1.9 million during the three months ended March 31, 2025 compared to a provision of $2.9 million during the three months ended March 31, 2024.
Previous report
For the three months ended March 31, 2025 and December 31, 2024, revenue from real estate owned was $6.8 million and $8.7 million, respectively. The $1.9 million decrease for the three months ended March 31, 2025 was primarily the result of the sales of multifamily real estate owned, held for sale assets located in North Carolina and Texas from the end of the fourth quarter of 2024 through the first quarter of 2025.
Previous report
Benefit for credit losses was $1.9 million during the three months ended March 31, 2025 compared to a provision of $0.9 million during the three months ended December 31, 2024.
Previous report
During the three months ended March 31, 2024, the maximum average outstanding balance was $569.8 million, of which $378.3 million was related to repurchase agreements on our commercial mortgage loans and $191.5 million for repurchase agreements on our real estate securities.
Reworded paragraphs (58)
Previous wording
•other factors set forth under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024.
Current wording
•other factors set forth under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, 2024 and this Quarterly Report on Form 10-Q for the quarter ended June 30, 2025.
Previous wording
The Company is a Maryland corporation and has made tax elections to be treated as a real estate investment trust ("REIT") for U.S. federal income tax purposes since 2013. The Company, through one or more subsidiaries which are each treated as a taxable REIT subsidiary ("TRS"), is indirectly subject to U.S. federal, state and local income taxes. We commenced business in May 2013. We primarily originate, acquire and manage a diversified portfolio of commercial real estate debt investments secured by properties located within and outside of the United States. Substantially all of our business is conducted through the OP, a Delaware limited partnership. We are the sole general partner and directly or indirectly hold all of the units of limited partner interests in the OP.
Current wording
The Company is a Maryland corporation and has made tax elections to be treated as a real estate investment trust ("REIT") for U.S. federal income tax purposes since 2013. The Company, through one or more subsidiaries which are each treated as a taxable REIT subsidiary ("TRS"), is indirectly subject to U.S. federal, state and local income taxes. We commenced business in May 2013. We primarily originate, acquire and manage a diversified portfolio of commercial real estate debt investments secured by properties located within and outside of the United States. Substantially all of our business is conducted through the OP, a Delaware limited partnership. We are the sole general partner and directly or indirectly held all of the units of limited partner interests in the OP as of June 30, 2025.
Previous wording
The Company has no employees. We are managed by the Advisor pursuant to an advisory agreement, as amended on August 18, 2021 (the "Advisory Agreement") with the Advisor. The Advisor manages our affairs on a day-to-day basis. The Advisor receives compensation and fees for services related to the investment and management of our assets and our operations.
Current wording
Prior to our acquisition of NewPoint on July 1, 2025 (as discussed below), the Company had no employees. As of July 28, 2025, we have 224 employees, all of which are employees of NewPoint. We are managed by the Advisor pursuant to an advisory agreement, as amended on August 18, 2021 (the "Advisory Agreement") with the Advisor. The Advisor manages our affairs on a day-to-day basis. The Advisor receives compensation and fees for services related to the investment and management of our assets and our operations.
Previous wording
The Company invests in commercial real estate debt investments, which may include first mortgage loans, subordinated mortgage loans, mezzanine loans and participations in such loans. The Company also originates conduit loans which the Company intends to sell through its TRS into CMBS securitization transactions. Historically this business has focused primarily on CMBS, CMBS bonds, CDOs and other securities. The Company also owns real estate that was either acquired by the Company through foreclosure or deed-in-lieu of foreclosure, or that was purchased for investment.
Current wording
The Company invests in commercial real estate debt investments, which may include first mortgage loans, subordinated mortgage loans, mezzanine loans and participations in such loans. The Company also originates conduit loans which the Company intends to sell through its TRS into CMBS securitization transactions. Historically this business has focused primarily on CMBS, CMBS bonds, CDOs and other securities. In addition, following its acquisition of NewPoint in July 2025, the Company originates and services agency mortgage loans. The Company also owns real estate that was either acquired by the Company through foreclosure or deed-in-lieu of foreclosure, or that was purchased for investment.
Previous wording
(3) Book value per share as of March 31, 2025 and December 31, 2024, excluding the impact for accumulated depreciation and amortization of real property of $14.8 million and $13.8 million, respectively, was $15.12 and $15.35.
Current wording
(3) Book value per share as of June 30, 2025 and December 31, 2024, excluding the impact for accumulated depreciation and amortization of real property of $16.0 million and $13.8 million, respectively, was $15.00 and $15.35.
Previous wording
During the three months ended March 31, 2025, there were no material changes to our critical accounting estimates as compared to the critical accounting estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.
Current wording
During the six months ended June 30, 2025, there were no material changes to our critical accounting estimates as compared to the critical accounting estimates disclosed in Management’s Discussion and Analysis of Financial Condition and Results of Operations contained in Part II, Item 7 of our Annual Report on Form 10-K for the year ended December 31, 2024.
Previous wording
As of March 31, 2025 and December 31, 2024, our portfolio consisted of 152 and 155 commercial mortgage loans, held for investment, respectively. The commercial mortgage loans, held for investment, net of allowance for credit losses, as of March 31, 2025 and December 31, 2024 had a total carrying value of $4,739.9 million and $4,908.7 million, respectively. As of March 31, 2025 and December 31, 2024, our commercial mortgage loans, held for sale, measured at fair value, were comprised of one and three loans with a total fair value of $5.0 million and $87.3 million, respectively. As of March 31, 2025 and December 31, 2024, we had $167.2 million and $203.0 million, respectively, of real estate securities, available for sale, measured at fair value. As of March 31, 2025 and December 31, 2024, our real estate owned, held for investment portfolio was composed of three properties with carrying values of $112.5 million and $113.2 million, respectively. As of March 31, 2025 and December 31, 2024, we had ten and twelve positions classified as real estate owned, held for sale with combined carrying values of $243.4 million and $222.9 million, respectively.
Current wording
As of June 30, 2025 and December 31, 2024, our portfolio consisted of 145 and 155 commercial mortgage loans, held for investment, respectively. The commercial mortgage loans, held for investment, net of allowance for credit losses, as of June 30, 2025 and December 31, 2024 had a total carrying value of $4,482.2 million and $4,908.7 million, respectively. As of June 30, 2025 and December 31, 2024, our commercial mortgage loans, held for sale, measured at fair value, were comprised of three loans with a total fair value of $17.2 million and $87.3 million, respectively. As of June 30, 2025 and December 31, 2024, we had $83.4 million and $203.0 million, respectively, of real estate securities, available for sale, measured at fair value. As of June 30, 2025 and December 31, 2024, our real estate owned, held for investment portfolio was composed of three properties with carrying values of $111.8 million and $113.2 million, respectively. As of June 30, 2025 and December 31, 2024, we had eight and twelve positions classified as real estate owned, held for sale with combined carrying values of $220.4 million and $222.9 million, respectively. As of June 30, 2025 and December 31, 2024 our equity method investments consisted of two properties and one property with carrying values of $23.4 million and $13.4 million, respectively.
Previous wording
As of March 31, 2025, we had three loans (one secured by an office property and two secured by multifamily properties), designated as non-performing status with a total amortized cost of $94.0 million. As of March 31, 2025, one of the non-performing loans, collateralized by an office property, continues to be placed on cost recovery status with a specific allowance for credit losses of $0.6 million.
Current wording
As of June 30, 2025, we had two loans (one secured by an office property and one secured by a multifamily property), designated as non-performing status with a total amortized cost of $56.9 million. As of June 30, 2025, one of the non-performing loans, collateralized by an office property, continues to be placed on cost recovery status with a specific allowance for credit losses of $0.3 million.
Previous wording
As of March 31, 2025 and December 31, 2024 our commercial mortgage loans, held for investment, excluding commercial mortgage loans on non-performing status, had a weighted average coupon of 7.9% and 8.0%, respectively, and a weighted average remaining contractual maturity life of 1.1 years and 1.1 years, respectively.
Current wording
As of June 30, 2025 and December 31, 2024 our commercial mortgage loans, held for investment, excluding commercial mortgage loans on non-performing status, had a weighted average coupon of 7.8% and 8.0%, respectively, and a weighted average remaining contractual maturity life of 1.0 years and 1.1 years, respectively.
Previous wording
Net interest income is generated on our interest-earning assets less related interest-bearing liabilities and is recorded as part of our real estate debt, real estate securities and TRS segments.
Current wording
Net interest income is generated on our interest-earning assets less related interest-bearing liabilities and is recorded as part of our real estate debt, real estate securities and conduit programs.
Previous wording
The following table presents the average balance of interest-earning assets less related interest-bearing liabilities, associated interest income and expense and corresponding yield earned and incurred for the three months ended March 31, 2025 and December 31, 2024 (dollars in thousands):
Current wording
The following table presents the average balance of interest-earning assets less related interest-bearing liabilities, associated interest income and expense and corresponding yield earned and incurred for the six months ended June 30, 2025 and 2024 (dollars in thousands):
Previous wording
(1) Based on amortized cost for real estate debt and real estate securities and principal amount for interest-bearing liabilities. Amounts are calculated based on daily averages for the three months ended March 31, 2025 and December 31, 2024, respectively.
Current wording
(1) Based on amortized cost for real estate debt and real estate securities and principal amount for interest-bearing liabilities. Amounts are calculated based on daily averages for the six months ended June 30, 2025 and 2024, respectively.
Previous wording
Interest income for the three months ended March 31, 2025 and December 31, 2024 totaled $113.9 million and $127.8 million, respectively, a decrease of $13.9 million. The decrease was primarily due to an approximate 34 basis point decrease in daily average SOFR and SOFR equivalent rates coupled with a decrease of $173.4 million in the average carrying balance of our real estate debt. As of March 31, 2025, our portfolio consisted of (i) 152 commercial mortgage loans, held for investment, (ii) one commercial mortgage loan, held for sale, measured at fair value and (iii) ten real estate securities, available for sale, measured at fair value. As of December 31, 2024, our portfolio consisted of (i) 155 commercial mortgage loans, held for investment, (ii) three commercial mortgage loan, held for sale, measured at fair value and (iii) 11 real estate securities, available for sale, measured at fair value.
Current wording
Interest income for the six months ended June 30, 2025 and 2024 totaled $225.1 million and $264.1 million, respectively, a decrease of $39.0 million. The decrease was primarily due to an approximate 100 basis point decrease in daily average SOFR and SOFR equivalent rates coupled with a decrease of $419.8 million in the average carrying balance of our real estate debt. As of June 30, 2025, our portfolio consisted of (i) 145 commercial mortgage loans, held for investment, (ii) three commercial mortgage loans, held for sale, measured at fair value and (iii) five real estate securities, available for sale, measured at fair value. As of June 30, 2024, our portfolio consisted of (i) 153 commercial mortgage loans, held for investment, (ii) four commercial mortgage loans, held for sale, measured at fair value and (iii) nine real estate securities, available for sale, measured at fair value.
Previous wording
Interest expense for the three months ended March 31, 2025 and December 31, 2024 was $70.6 million and $80.5 million, respectively, a decrease of $9.9 million. The decrease was primarily due to an approximate 34 basis point decrease in daily average SOFR and SOFR equivalent rates coupled with a decrease of $463.3 million in the average carrying value of our collateralized loan obligations.
Current wording
Interest expense for the six months ended June 30, 2025 and 2024 was $140.8 million and $168.1 million, respectively, a decrease of $27.3 million. The decrease was primarily due to an approximate 100 basis point decrease in daily average SOFR and SOFR equivalent rates coupled with a decrease of $253.7 million in the average carrying value of our collateralized loan obligations.
Previous wording
For the three months ended March 31, 2025 and 2024, revenue from real estate owned was $6.8 million and $4.7 million, respectively. The $2.1 million increase was primarily the result of rental income from obtaining possession of additional multifamily and office properties brought on as real estate owned for the three months ended March 31, 2025.
Current wording
For the six months ended June 30, 2025 and 2024, revenue from real estate owned was $15.1 million and $8.8 million, respectively. The $6.3 million increase was primarily the result of rental income from obtaining possession of additional multifamily and office properties brought on as real estate owned for the six months ended June 30, 2025.
Previous wording
For the three months ended March 31, 2025, the primary decrease in specific reserve of $0.3 million was related to a partial paydown on our non-performing loan secured by an office property in Georgia. For the three months ended December 31, 2024, the increase in specific reserve of $2.5 million was primarily related to a non-performing loan collateralized by a multifamily property located in Texas.
Current wording
For the six months ended June 30, 2025, the increase in specific reserve of $0.8 million was related to a non-performing loan secured by a multifamily property in Texas which we foreclosed on during the second quarter, partially offset by a partial paydown on a non-performing loan secured by an office property in Georgia. For the six months ended June 30, 2024, the increase in specific reserve of $33.0 million was related to multiple loans, including non-performing multifamily loans and office loans.
Previous wording
Realized gain on commercial mortgage loans, held for sale, measured at fair value for the three months ended March 31, 2025 of $5.0 million was related to the sale of $106.5 million in principal amount of commercial real estate loans into the CMBS securitization market resulting in proceeds of $111.5 million. The Company did not realize any gain or loss on commercial mortgage loans, held for sale, measured at fair value for the three months ended December 31, 2024.
Current wording
Realized gain on commercial mortgage loans, held for sale, measured at fair value for the six months ended June 30, 2025 of $5.3 million was related to the sale of $114.4 million in principal amount of commercial real estate loans into the CMBS securitization market resulting in proceeds of $119.7 million. Realized gain on commercial mortgage loans, held for sale, measured at fair value for the six months ended June 30, 2024 of $6.9 million was related to the sale of $139.6 million in principal amount of commercial real estate loans into the CMBS securitization market resulting in proceeds of $146.5 million.
Previous wording
The Company did not recognize an unrealized gain or loss on commercial mortgage loans, held for sale, measured at fair value for the three months ended March 31, 2025. For the three months ended March 31, 2024, unrealized gain on commercial mortgage loans, held for sale, measured at fair value, was $0.5 million which was attributable to the change in market value of these loans.
Current wording
The Company did not recognize an unrealized gain or loss on commercial mortgage loans, held for sale, measured at fair value for the six months ended June 30, 2025. Unrealized gain on commercial mortgage loans, held for sale, measured at fair value for the six months ended June 30, 2024 of $0.6 million was primarily related to the reversal of unrealized loss on sales of commercial real estate loans into the CMBS securitization market.
Previous wording
Net result from derivative transactions for the three months ended March 31, 2025 of a $0.2 million loss was composed primarily of a $1.1 million unrealized loss on mark to market on credit default swaps, treasury note futures, and options, partially offset by a realized gain of $0.9 million due to the termination and settlement of treasury note futures. This is compared to a net gain on our derivative portfolio of $1.0 million composed primarily of unrealized gains on mark to market on credit default swaps, treasury note futures, and options for the three months ended December 31, 2024.
Current wording
Net result from derivative transactions for the six months ended June 30, 2025 of a $0.3 million loss was composed primarily of a $1.2 million unrealized loss on marks to market on credit default swaps, treasury note futures, and options, partially offset by a realized gain of $0.9 million due to the termination and settlement of treasury note futures. Net result from derivative transactions for the six months ended June 30, 2024 was composed of a realized gain of $0.3 million primarily related to the termination and settlement of credit default swaps and treasury note futures offset by an unrealized loss of $0.3 million.
Previous wording
Provision for income tax for the three months ended March 31, 2025 was $0.7 million compared to a provision of $0.2 million for the three months ended December 31, 2024. The difference is related to changes in taxable income/loss in our TRS segment.
Current wording
Provision for income tax for the six months ended June 30, 2025 was $0.5 million compared to a provision of $0.7 million for the six months ended June 30, 2024. The difference is related to changes in taxable income/loss in our TRS segment.
Previous wording
Net loss attributable to non-controlling interest in our consolidated joint ventures for the three months ended March 31, 2025 and December 31, 2024 totaled $0.4 million in both periods.
Current wording
Net income attributable to non-controlling interest in our consolidated joint ventures for the six months ended June 30, 2025 was $0.8 million compared to a net loss of $1.7 million for the six months ended June 30, 2024.
Previous wording
Expenses from operations for the three months ended March 31, 2025 and 2024 consisted of the following (dollars in thousands):
Current wording
Expenses from operations for the six months ended June 30, 2025 and 2024 consisted of the following (dollars in thousands):
Previous wording
For the three months ended March 31, 2025, we incurred asset management and subordinated performance fees and administrative services expenses of $6.6 million and $3.3 million, respectively, which are payable to our Advisor under our asset management agreement. For the three months ended March 31, 2025 compared to March 31, 2024, asset management and incentive fees decreased due to a decrease in applicable equity between periods, while administrative services expenses and professional fees increased due to the NewPoint acquisition. Refer to Note 11 - Related Party Transactions and Arrangements for a summary of the Company's Advisory Agreement with the Advisor and a description of how our fees are calculated.
Current wording
For the six months ended June 30, 2025, we incurred asset management and subordinated performance fees and administrative services expenses of $12.1 million and $7.2 million, respectively, which are payable to our Advisor under our asset management agreement. For the six months ended June 30, 2025 compared to June 30, 2024, asset management and subordinated performance fees decreased due to decreases in applicable equity between periods, while administrative services expenses increased due to the time spent on the NewPoint acquisition. Refer to Note 11 - Related Party Transactions and Arrangements for a summary of the Company's Advisory Agreement with the Advisor and a description of how our fees are calculated.
Previous wording
The increase in operating expense was primarily related to (i) an increase in professional fees due to the NewPoint acquisition during the three months ended March 31, 2025 and (ii) an increase in other expenses related to property operating expenses and third party management fees incurred in order to operate various real estate owned investments in our portfolio for the three months ended March 31, 2025.
Current wording
The increase in operating expense for the six months ended June 30, 2025 was primarily related to (i) an increase in professional fees related to the NewPoint acquisition and (ii) an increase in other expenses related to property operating expenses and third party management fees incurred in order to operate various real estate owned investments in our portfolio.
Previous wording
Net interest income is generated on our interest-earning assets less related interest-bearing liabilities and is recorded as part of our real estate debt, real estate securities and TRS segments.
Current wording
Net interest income is generated on our interest-earning assets less related interest-bearing liabilities and is recorded as part of our real estate debt, real estate securities and conduit programs.
Previous wording
daily average SOFR and SOFR equivalent rates coupled with a decrease of $177.9 million in the average carrying balance of our real estate debt. As of March 31, 2025, our portfolio consisted of (i) 152 commercial mortgage loans, held for investment (ii) one commercial mortgage loan, held for sale, measured at fair value and (iii) ten real estate securities, available for sale, measured at fair value. As of March 31, 2024, our portfolio consisted of (i) 145 commercial mortgage loans, held for investment, (ii) one commercial mortgage loan, held for sale, measured at fair value and (iii) seven real estate securities, available for sale, measured at fair value.
Current wording
Interest income for the three months ended June 30, 2025 and March 31, 2025 totaled $111.2 million and $113.9 million, respectively, a decrease of $2.7 million. This decrease was primarily due to a decrease of $149.9 million in the average carrying balance of our real estate debt. SOFR rates remained consistent quarter over quarter. As of June 30, 2025, our portfolio consisted of (i) 145 commercial mortgage loans, held for investment, (ii) three commercial mortgage loans, held for sale, measured at fair value and (iii) five real estate securities, available for sale, measured at fair value. As of March 31, 2025, our portfolio consisted of (i) 152 commercial mortgage loans, held for investment, (ii) one commercial mortgage loan, held for sale, measured at fair value and (iii) ten real estate securities, available for sale, measured at fair value.
Previous wording
For the three months ended March 31, 2025 and December 31, 2024, general benefit for credit losses was $1.6 million and $1.6 million, respectively. General benefit for the three months ended March 31, 2025 and December 31, 2024, respectively, is primarily due to the portfolio turnover of older vintage loans with newly originated loans.
Current wording
For the three months ended June 30, 2025 and March 31, 2025, general benefit for credit losses was $2.6 million and $1.6 million, respectively. General benefit for both periods decreased primarily due to the portfolio turnover of older vintage loans with newly originated loans, coupled by a decrease in the overall size of our portfolio.
Previous wording
For the three months ended March 31, 2025, specific benefit for credit losses was $0.3 million compared to a specific provision for credit losses of $0.7 million for the three months ended March 31, 2024. For the three months ended March 31, 2025, the decrease in specific reserve was primarily related to a partial paydown on our non-performing loan secured by an office property in Georgia. For the three months ended March 31, 2024, the increase in specific reserve was related to a non-performing loan secured by two multifamily properties located in North Carolina.
Current wording
For the three months ended June 30, 2025, specific provision for credit losses was $1.1 million compared to a specific benefit for credit losses of $0.3 million for the three months ended March 31, 2025. For the three months ended June 30, 2025, the increase in specific reserve was primarily related to a non-performing loan secured by a multifamily property in Texas which we foreclosed on during the second quarter. For the three months ended March 31, 2025, the decrease in specific reserve was related to a partial paydown on a non-performing loan secured by an office property in Georgia.
Previous wording
The Company did not realize a gain or loss on real estate securities, available for sale for the three months ended March 31, 2025. Realized gain on real estate securities, available for sale for the three months ended March 31, 2024 of $0.1 million was primarily related to the sale of three CRE CLO bonds.
Current wording
Realized gain on real estate securities, available for sale for the three months ended June 30, 2025 of $0.1 million related to eight sales of our CRE CLO bonds. The Company did not realize a gain or loss on real estate securities, available for sale for the three months ended March 31, 2025.
Previous wording
Realized gain on commercial mortgage loans, held for sale, measured at fair value for the three months ended March 31, 2025 of $5.0 million was related to the sale of $106.5 million in principal amount of commercial real estate loans into the CMBS securitization market resulting in proceeds of $111.5 million. Realized gain on commercial mortgage loans, held for sale, measured at fair value for the three months ended March 31, 2024 of $5.5 million was related to the sale of $100.7 million in principal amount of commercial real estate loans into the CMBS securitization market resulting in proceeds of $106.2 million.
Current wording
Realized gain on commercial mortgage loans, held for sale, measured at fair value for the three months ended June 30, 2025 of $0.3 million was related to the sale of $8.0 million in principal amount of commercial real estate loans into the CMBS securitization market resulting in proceeds of $8.3 million. Realized gain on commercial mortgage loans, held for sale, measured at fair value for the three months ended March 31, 2025 of $5.0 million was related to the sale of $106.5 million in principal amount of commercial real estate loans into the CMBS securitization market resulting in proceeds of $111.5 million.
Previous wording
Loss on other real estate investments for the three months ended March 31, 2025 was $2.2 million primarily due to the onboarding of real estate owned, held for sale, multifamily and office properties coupled with losses on the sale of three, held for sale, multifamily properties and one, held for sale, retail property from our Walgreens Portfolio. This is compared to a gain of $0.5 million for the three months ended December 31, 2024 primarily due to the onboarding of real estate owned, held for sale, multifamily properties partially offset by losses on the sales of three, held for sale, multifamily properties and one, held for sale, retail property from our Walgreens Portfolio.
Current wording
Gain on other real estate investments for the three months ended June 30, 2025 was $2.7 million primarily due to the sales and settled litigation regarding the Walgreens Portfolio, partially offset by losses related to the onboarding of one real estate owned, held for sale, multifamily property, as well as fair value write downs on two multifamily properties. Loss on other real estate investments for the three months ended March 31, 2025 was $2.2 million primarily due to the onboarding of real estate owned, held for sale, multifamily and office properties coupled with losses on the sale of three, held for sale, multifamily properties and one, held for sale, retail property from our Walgreens Portfolio.
Previous wording
Net result from derivative transactions for the three months ended March 31, 2025 of a $0.2 million loss was composed primarily of a $1.1 million unrealized loss on mark to market on credit default swaps, treasury note futures, and options, partially offset by a realized gain of $0.9 million due to the termination and settlement of treasury note futures. This is compared to a net gain on our derivative portfolio of $0.2 million composed of a realized gain of $0.3 million primarily related to the termination and settlement of credit default swaps and treasury note futures offset by an unrealized loss of $0.1 million for three months ended March 31, 2024.
Current wording
Net result from derivative transactions for the three months ended June 30, 2025 of a $0.2 million loss was composed primarily of a $0.1 million unrealized loss on mark to market on credit default swaps and treasury note futures, coupled with a realized loss of $0.1 million due to the termination and settlement of credit default swaps and treasury note futures. This is compared to a net loss on our derivative portfolio of $0.2 million composed primarily of a $1.1 million unrealized loss on mark to market on credit default swaps, treasury note futures, and options, partially offset by a realized gain of $0.9 million due to the termination and settlement of treasury note futures for the three months ended March 31, 2025.
Previous wording
Provision for income tax for the three months ended March 31, 2025 was $0.7 million compared to provision of $0.8 million for the three months ended March 31, 2024. The difference is related to changes in taxable income/loss in our TRS segment.
Current wording
Benefit for income tax for the three months ended June 30, 2025 was $0.1 million compared to provision of $0.7 million for the three months ended March 31, 2025. The difference is related to changes in taxable income/loss in our TRS segment.
Previous wording
Net loss attributable to non-controlling interest in our consolidated joint ventures for the three months ended March 31, 2025 and 2024 was $0.4 million and $0.1 million, respectively.
Current wording
Net income attributable to non-controlling interest in our consolidated joint ventures for the three months ended June 30, 2025 was $1.2 million compared to a net loss of $0.4 million for the three months ended March 31, 2025.
Previous wording
For the three months ended March 31, 2025, we incurred asset management and subordinated performance fees and administrative services expenses of $6.6 million and $3.3 million, respectively, which are payable to our Advisor under our asset management agreement. For the three months ended March 31, 2025 compared to December 31, 2024, asset management and incentive fees decreased due to decreases in applicable equity, while administrative services expenses increased due to the time spent on the NewPoint acquisition. Refer to Note 11 - Related Party Transactions and Arrangements for a summary of the Company's Advisory Agreement with the Advisor and a description of how our fees are calculated.
Current wording
For the three months ended June 30, 2025 we incurred asset management and subordinated performance fees and administrative services expenses of $5.5 million and $3.9 million, respectively, which are payable to our Advisor under our asset management agreement. For the three months ended June 30, 2025 compared to March 31, 2025, asset management and incentive fees decreased due to a decrease in applicable equity between periods, while administrative services expenses increased due to the time spent on the NewPoint acquisition. Refer to Note 11 - Related Party Transactions and Arrangements for a summary of the Company's Advisory Agreement with the Advisor and a description of how our fees are calculated.
Previous wording
(1)Represents (i) total outstanding borrowings under secured financing arrangements, including collateralized loan obligations, repurchase agreements - commercial mortgage loans, repurchase agreements - real estate securities, asset-specific financing arrangements, and unsecured debt, less cash and cash equivalents, to (ii) total equity and total redeemable convertible preferred stock, at period end. Recourse net debt-to-equity ratio was 0.3x and 0.3x as of March 31, 2025 and December 31, 2024, respectively.
Current wording
(1)Represents (i) total outstanding borrowings under secured financing arrangements, including collateralized loan obligations, repurchase agreements - commercial mortgage loans, repurchase agreements - real estate securities, asset-specific financing arrangements, and unsecured debt, less cash and cash equivalents, to (ii) total equity and total redeemable convertible preferred stock, at period end. Recourse net debt-to-equity ratio was 0.3x as of both June 30, 2025 and December 31, 2024.
Previous wording
(2) Represents (i) total outstanding borrowings under secured financing arrangements, including collateralized loan obligations, repurchase agreements - commercial mortgage loans, repurchase agreements - real estate securities, asset-specific financing arrangements, and unsecured debt, to (ii) total equity and total redeemable convertible preferred stock, at period end. Recourse leverage ratio was 0.5x and 0.4x as of March 31, 2025 and December 31, 2024, respectively.
Current wording
(2) Represents (i) total outstanding borrowings under secured financing arrangements, including collateralized loan obligations, repurchase agreements - commercial mortgage loans, repurchase agreements - real estate securities, asset-specific financing arrangements, and unsecured debt, to (ii) total equity and total redeemable convertible preferred stock, at period end. Recourse leverage ratio was 0.6x and 0.4x as of June 30, 2025 and December 31, 2024, respectively.
Previous wording
(2)Represents cash available we can invest at a market advance rate utilizing our available capacity on financing lines.
Current wording
(3)Represents cash available we can invest at a market advance rate utilizing our available capacity on financing lines.
Previous wording
$200 million of shares of our common stock from time to time. We have not sold any shares of common stock under the ATM to date. We also may access liquidity through our dividend reinvestment and stock purchase plan (“DRIP”), which includes a direct stock purchase option.
Current wording
We have an effective shelf registration statement for offerings of equity securities that is not limited on the amount of securities we may issue. We also have authorized an at-the-market sales program (“ATM”) pursuant to which we may sell up to $200 million of shares of our common stock from time to time. We have not sold any shares of common stock under the ATM to date. We also may access liquidity through our dividend reinvestment and stock purchase plan (“DRIP”), which includes a direct stock purchase option.
Previous wording
As of March 31, 2025, the Company had $34.1 million of reinvestment capital available across all outstanding collateralized loan obligations. The following table shows the par value outstanding for each CLO and the respective reinvestment end dates (dollars in millions):
Current wording
As of June 30, 2025, the Company had $79.4 million of reinvestment capital available across all outstanding collateralized loan obligations. The following table shows the par value outstanding for each CLO and the respective reinvestment end dates (dollars in millions):
Showing the first 40 of 58 pairs. Open the source sections for the rest.
Rearranged current paragraphs (2)
Current report — wording carried from elsewhere
Realized Gain/(Loss) on Real Estate Securities, Available for Sale
Current report — wording carried from elsewhere
Changes in operating expense was primarily related to (i) a decrease in professional fees quarter over quarter due to expenses incurred in the first quarter related to the NewPoint acquisition offset by (ii) an increase in other expenses related to property operating expenses and third party management fees incurred in order to operate various real estate owned investments in our portfolio for the three months ended June 30, 2025.
Rearranged previous paragraphs (4)
Previous report — wording carried elsewhere
For the three months ended March 31, 2025, general benefit for credit losses was $1.6 million compared to a general provision of $2.1 million for the three months ended March 31, 2024. The $3.7 million decrease in general reserve was primarily due to the portfolio turnover of older vintage loans with newly originated loans.
Previous report — wording carried elsewhere
Loss on other real estate investments for the three months ended March 31, 2025 was $2.2 million primarily due to the onboarding of real estate owned, held for sale, multifamily and office properties coupled with losses on the sale of three, held for sale, multifamily properties and one, held for sale, retail property from our Walgreens Portfolio. This is compared to a gain of $6.0 thousand for the three months ended March 31, 2024 that was related to the sale of one real estate owned, held for sale property located in San Antonio, TX.
Previous report — wording carried elsewhere
The increase in operating expense was primarily related to (i) an increase in professional fees due to time spent on the Newpoint acquisition during the three months ended March 31, 2025.
Previous report — wording carried elsewhere
We have an effective shelf registration statement for offerings of equity securities that is not limited on the amount of securities we may issue. We also have authorized an at-the-market sales program (“ATM”) pursuant to which we may sell up to