Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2018 | Oct. 26, 2018 | |
Document and Entity Information | ||
Entity Registrant Name | ARBOR REALTY TRUST INC | |
Entity Central Index Key | 1,253,986 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2018 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Common Stock, Shares Outstanding | 75,684,964 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Assets: | ||
Cash and cash equivalents | $ 92,598 | $ 104,374 |
Restricted cash | 202,736 | 139,398 |
Loans and investments, net | 3,097,689 | 2,579,127 |
Loans held-for-sale, net | 500,281 | 297,443 |
Capitalized mortgage servicing rights, net | 259,401 | 252,608 |
Securities held-to-maturity, net | 50,520 | 27,837 |
Investments in equity affiliates | 22,101 | 23,653 |
Real estate owned, net | 14,563 | 16,787 |
Due from related party | 97,505 | 688 |
Goodwill and other intangible assets | 117,565 | 121,766 |
Other assets | 79,301 | 62,264 |
Total assets | 4,534,260 | 3,625,945 |
Liabilities and Equity: | ||
Credit facilities and repurchase agreements | 1,169,586 | 528,573 |
Collateralized loan obligations | 1,592,089 | 1,418,422 |
Debt fund | 68,099 | 68,084 |
Senior unsecured notes | 122,358 | 95,280 |
Convertible senior unsecured notes, net | 263,653 | 231,287 |
Junior subordinated notes to subsidiary trust issuing preferred securities | 140,084 | 139,590 |
Related party financing | 50,000 | |
Due to related party | 538 | |
Due to borrowers | 77,006 | 99,829 |
Allowance for loss-sharing obligations | 33,405 | 30,511 |
Other liabilities | 100,970 | 99,813 |
Total liabilities | 3,567,788 | 2,761,389 |
Commitments and contingencies (Note 14) | ||
Arbor Realty Trust, Inc. stockholders' equity: | ||
Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares authorized; special voting preferred shares; 20,653,584 and 21,230,769 shares issued and outstanding, respectively; 8.25% Series A, $38,788 aggregate liquidation preference; 1,551,500 shares issued and outstanding; 7.75% Series B, $31,500 aggregate liquidation preference; 1,260,000 shares issued and outstanding; 8.50% Series C, $22,500 aggregate liquidation preference; 900,000 shares issued and outstanding | 89,508 | 89,508 |
Common stock, $0.01 par value: 500,000,000 shares authorized; 75,684,964 and 61,723,387 shares issued and outstanding, respectively | 757 | 617 |
Additional paid-in capital | 785,364 | 707,450 |
Accumulated deficit | (78,316) | (101,926) |
Accumulated other comprehensive income | 176 | |
Total Arbor Realty Trust, Inc. stockholders' equity | 797,313 | 695,825 |
Noncontrolling interest | 169,159 | 168,731 |
Total equity | 966,472 | 864,556 |
Total liabilities and equity | $ 4,534,260 | $ 3,625,945 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 75,684,964 | 61,723,387 |
Common stock, shares outstanding (in shares) | 75,684,964 | 61,723,387 |
Special voting preferred shares | ||
Preferred stock, shares issued (in shares) | 20,653,584 | 21,230,769 |
Preferred stock, shares outstanding (in shares) | 20,653,584 | 21,230,769 |
8.25% Series A preferred stock | ||
Preferred stock, dividend rate (as a percent) | 8.25% | 8.25% |
Preferred stock, aggregate liquidation preference | $ 38,788 | $ 38,788 |
Preferred stock, shares issued (in shares) | 1,551,500 | 1,551,500 |
Preferred stock, shares outstanding (in shares) | 1,551,500 | 1,551,500 |
7.75% Series B preferred stock | ||
Preferred stock, dividend rate (as a percent) | 7.75% | 7.75% |
Preferred stock, aggregate liquidation preference | $ 31,500 | $ 31,500 |
Preferred stock, shares issued (in shares) | 1,260,000 | 1,260,000 |
Preferred stock, shares outstanding (in shares) | 1,260,000 | 1,260,000 |
8.50% Series C preferred stock | ||
Preferred stock, dividend rate (as a percent) | 8.50% | 8.50% |
Preferred stock, aggregate liquidation preference | $ 22,500 | $ 22,500 |
Preferred stock, shares issued (in shares) | 900,000 | 900,000 |
Preferred stock, shares outstanding (in shares) | 900,000 | 900,000 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | ||||
Interest income | $ 67,500 | $ 42,140 | $ 178,408 | $ 110,133 |
Interest expense | 39,548 | 23,850 | 110,819 | 63,698 |
Net interest income | 27,952 | 18,290 | 67,589 | 46,435 |
Other revenue: | ||||
Gain on sales, including fee-based services, net | 17,451 | 17,126 | 51,266 | 55,127 |
Mortgage servicing rights | 25,216 | 18,897 | 62,787 | 56,182 |
Servicing revenue, net | 14,244 | 8,520 | 34,662 | 19,923 |
Property operating income | 2,651 | 2,668 | 8,525 | 8,755 |
Other income, net | (3,982) | 778 | (1,574) | (931) |
Total other revenue | 55,580 | 47,989 | 155,666 | 139,056 |
Other expenses: | ||||
Employee compensation and benefits | 27,775 | 25,194 | 84,084 | 66,861 |
Selling and administrative | 9,994 | 7,607 | 27,783 | 23,136 |
Property operating expenses | 2,437 | 2,583 | 8,089 | 7,843 |
Depreciation and amortization | 1,848 | 1,829 | 5,539 | 5,542 |
Impairment loss on real estate owned | 2,000 | 2,700 | ||
Provision for loss sharing (net of recoveries) | 2,019 | (2,617) | 2,840 | (405) |
Provision for loan losses (net of recoveries) | 836 | 2,000 | (967) | (457) |
Litigation settlement gain | (10,170) | (10,170) | ||
Management fee - related party | 6,673 | |||
Total other expenses | 34,739 | 36,596 | 119,198 | 111,893 |
Income before extinguishment of debt, (loss) income from equity affiliates and income taxes | 48,793 | 29,683 | 104,057 | 73,598 |
(Loss) gain on extinguishment of debt | (4,960) | (4,960) | 7,116 | |
(Loss) income from equity affiliates | (1,028) | 996 | 1,104 | 1,756 |
Provision for income taxes | (5,381) | (6,708) | (1,096) | (16,244) |
Net income | 37,424 | 23,971 | 99,105 | 66,226 |
Preferred stock dividends | 1,888 | 1,888 | 5,665 | 5,665 |
Net income attributable to noncontrolling interest | 7,799 | 5,662 | 22,347 | 16,597 |
Net income attributable to common stockholders | $ 27,737 | $ 16,421 | $ 71,093 | $ 43,964 |
Basic earnings per common share (in dollars per share) | $ 0.37 | $ 0.27 | $ 1.05 | $ 0.78 |
Diluted earnings per common share (in dollars per share) | $ 0.36 | $ 0.26 | $ 1.03 | $ 0.77 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 74,802,582 | 61,582,796 | 67,490,132 | 56,602,504 |
Diluted (in shares) | 98,435,964 | 83,918,117 | 91,133,607 | 78,942,919 |
Dividends declared per common share (in dollars per share) | $ 0.25 | $ 0.18 | $ 0.71 | $ 0.53 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) | ||||
Net income | $ 37,424 | $ 23,971 | $ 99,105 | $ 66,226 |
Unrealized loss on securities available-for-sale, at fair value | (235) | (353) | ||
Reclassification of net unrealized gains on available-for-sale securities into accumulated deficit (Note 2) | (176) | |||
Reclassification of net realized loss on derivatives designated as cash flow hedges into earnings | 237 | |||
Comprehensive income | 37,424 | 23,736 | 98,929 | 66,110 |
Less: | ||||
Comprehensive income attributable to noncontrolling interest | 7,799 | 5,602 | 22,303 | 16,574 |
Preferred stock dividends | 1,888 | 1,888 | 5,665 | 5,665 |
Comprehensive income attributable to common stockholders | $ 27,737 | $ 16,246 | $ 70,961 | $ 43,871 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Unaudited) - 9 months ended Sep. 30, 2018 - USD ($) $ in Thousands | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated DeficitPreferred stock of private REIT | Accumulated Deficit | Accumulated Other Comprehensive Income | Total Arbor Realty Trust, Inc. Stockholders' EquityPreferred stock of private REIT | Total Arbor Realty Trust, Inc. Stockholders' Equity | Noncontrolling Interest | Preferred stock of private REIT | Total |
Balance at Dec. 31, 2017 | $ 89,508 | $ 617 | $ 707,450 | $ (101,926) | $ 176 | $ 695,825 | $ 168,731 | $ 864,556 | |||
Balance (in shares) at Dec. 31, 2017 | 24,942,269 | 61,723,387 | |||||||||
Increase (Decrease) in Stockholders' Equity | |||||||||||
Issuance of common stock from debt exchange | $ 68 | 74,322 | 74,390 | 74,390 | |||||||
Issuance of common stock from debt exchange | 6,820,196 | ||||||||||
Extinguishment of convertible senior unsecured notes | (66,518) | (66,518) | (66,518) | ||||||||
Issuance of convertible senior unsecured notes, net | 9,436 | 9,436 | 9,436 | ||||||||
Issuance of common stock, net | $ 65 | 55,843 | 55,908 | 55,908 | |||||||
Issuance of common stock, net (in shares) | 6,452,700 | ||||||||||
Stock-based compensation | $ 7 | 4,831 | 4,838 | 4,838 | |||||||
Stock-based compensation (in shares) | 691,015 | ||||||||||
Forfeiture of unvested restricted stock (in shares) | (2,334) | ||||||||||
Distributions - common stock | (47,648) | (47,648) | (47,648) | ||||||||
Distributions - preferred stock | $ (11) | (5,665) | $ (11) | (5,665) | $ (11) | (5,665) | |||||
Distributions - noncontrolling interest | (15,074) | (15,074) | |||||||||
Redemption of operating partnership units | (6,845) | (6,845) | |||||||||
Net income | 76,758 | 76,758 | 22,347 | 99,105 | |||||||
Reclassification of net unrealized gains on available-for-sale securities into accumulated deficit | 176 | $ (176) | (176) | ||||||||
Balance at Sep. 30, 2018 | $ 89,508 | $ 757 | $ 785,364 | $ (78,316) | $ 797,313 | $ 169,159 | $ 966,472 | ||||
Balance (in shares) at Sep. 30, 2018 | 24,942,269 | 75,684,964 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) shares in Thousands, $ in Thousands | 9 Months Ended | |
Sep. 30, 2018USD ($)shares | Sep. 30, 2017USD ($) | |
Operating activities: | ||
Net income | $ 99,105 | $ 66,226 |
Adjustments to reconcile net income to net cash (used in) provided by operating activities: | ||
Depreciation and amortization | 5,539 | 5,542 |
Stock-based compensation | 4,838 | 3,833 |
Amortization and accretion of interest and fees, net | 8,758 | 3,296 |
Amortization of capitalized mortgage servicing rights | 35,639 | 35,427 |
Originations of loans held-for-sale | (3,455,237) | (3,287,578) |
Proceeds from sales of loans held-for-sale, net of gain on sale | 3,254,490 | 3,621,276 |
Payoffs and paydowns of loans held-for-sale | 30 | 116 |
Mortgage servicing rights | (62,787) | (56,182) |
Write-off of capitalized mortgage servicing rights from payoffs | 17,228 | 10,713 |
Impairment loss on real estate owned | 2,000 | 2,700 |
Provision for loan losses (net of recoveries) | (967) | (457) |
Provision for loss sharing (net of recoveries) | 2,840 | (405) |
Recoveries (charge-offs) for loss sharing obligations, net | 54 | (1,844) |
Deferred tax (benefit) provision | (14,454) | 15 |
Income from equity affiliates | (1,104) | (1,756) |
Loss (gain) on extinguishment of debt | 4,960 | (7,116) |
Changes in operating assets and liabilities | (96,468) | (6,368) |
Net cash (used in) provided by operating activities | (195,536) | 387,438 |
Investing Activities: | ||
Loans and investments funded and originated, net | (1,163,908) | (1,051,446) |
Payoffs and paydowns of loans and investments | 688,032 | 758,139 |
Internalization of management team | (25,000) | |
Deferred fees | 8,556 | 7,214 |
Investments in real estate, net | (309) | (562) |
Contributions to equity affiliates | (2,480) | (693) |
Distributions from equity affiliates | 3,110 | 2,341 |
Purchase of securities held-to-maturity, net | (21,637) | (18,339) |
Payoffs and paydowns of securities held-to-maturity | 1,223 | 76 |
Proceeds from insurance settlements, net | 493 | 493 |
Due to borrowers and reserves | (63,296) | (22,571) |
Net cash used in investing activities | (550,216) | (350,348) |
Financing activities: | ||
Proceeds from repurchase agreements and credit facilities | 6,376,333 | 6,073,385 |
Payoffs and paydowns of repurchase agreements and credit facilities | (5,734,858) | (6,417,834) |
Payoffs and paydowns of collateralized debt obligations | (267,750) | (219,000) |
Exchange of convertible senior unsecured notes | (219,922) | |
Payoffs of senior unsecured notes | (97,860) | |
Payoff of related party financing | (50,000) | |
Payoffs of junior subordinated notes to subsidiary trust issuing preferred securities | (12,691) | |
Proceeds from issuance of collateralized loan obligations | 441,000 | 561,874 |
Proceeds from issuance of senior unsecured notes | 125,000 | |
Proceeds from issuance of convertible senior unsecured notes | 264,500 | 13,750 |
Proceeds from issuance of common stock, net | 55,908 | 76,225 |
Receipts on swaps and returns of margin calls from counterparties | 430 | |
Redemption of operating partnership units | (6,845) | |
Distributions paid on common stock | (47,648) | (30,889) |
Distributions paid on noncontrolling interest | (15,074) | (11,252) |
Distributions paid on preferred stock | (5,665) | (5,665) |
Distributions paid on preferred stock of private REIT | (11) | (11) |
Payment of deferred financing costs | (19,794) | (11,482) |
Net cash provided by financing activities | 797,314 | 16,840 |
Net increase in cash, cash equivalents and restricted cash | 51,562 | 53,930 |
Cash, cash equivalents and restricted cash at beginning of period | 243,772 | 167,960 |
Cash, cash equivalents and restricted cash at end of period | 295,334 | 221,890 |
Supplemental cash flow information: | ||
Cash used to pay interest | 82,140 | 53,150 |
Cash used to pay taxes | 16,551 | 14,653 |
Supplemental schedule of non-cash investing and financing activities: | ||
Fair value of conversion feature of convertible senior unsecured notes | $ 9,750 | |
Issuance of common stock from debt exchange | shares | 74,322 | |
Extinguishment of convertible senior unsecured notes | $ (66,518) | |
8.25% Series A preferred stock | ||
Supplemental schedule of non-cash investing and financing activities: | ||
Distributions accrued on preferred stock | 267 | 267 |
7.75% Series B preferred stock | ||
Supplemental schedule of non-cash investing and financing activities: | ||
Distributions accrued on preferred stock | 203 | 203 |
8.50% Series C preferred stock | ||
Supplemental schedule of non-cash investing and financing activities: | ||
Distributions accrued on preferred stock | $ 159 | $ 159 |
CONSOLIDATED STATEMENTS OF CA_2
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Parenthetical) | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
8.25% Series A preferred stock | |||
Preferred stock, dividend rate (as a percent) | 8.25% | 8.25% | 8.25% |
7.75% Series B preferred stock | |||
Preferred stock, dividend rate (as a percent) | 7.75% | 7.75% | 7.75% |
8.50% Series C preferred stock | |||
Preferred stock, dividend rate (as a percent) | 8.50% | 8.50% | 8.50% |
Description of Business
Description of Business | 9 Months Ended |
Sep. 30, 2018 | |
Description of Business | |
Description of Business | Note 1 — Description of Business Arbor Realty Trust, Inc. (“we,” “us,” or “our”) is a Maryland corporation formed in 2003. We operate through two business segments: our Structured Loan Origination and Investment Business ("Structured Business”) and our Agency Loan Origination and Servicing Business ("Agency Business”). Through our Structured Business, we invest in a diversified portfolio of structured finance assets in the multifamily and commercial real estate markets, primarily consisting of bridge and mezzanine loans, including junior participating interests in first mortgages, preferred and direct equity. We may also directly acquire real property and invest in real estate-related notes and certain mortgage-related securities. Through our Agency Business, we originate, sell and service a range of multifamily finance products through the Federal National Mortgage Association ("Fannie Mae") and the Federal Home Loan Mortgage Corporation ("Freddie Mac," and together with Fannie Mae, the government-sponsored enterprises, or the "GSEs"), the Government National Mortgage Association ("Ginnie Mae"), Federal Housing Authority ("FHA") and the U.S. Department of Housing and Urban Development (together with Ginnie Mae and FHA, "HUD") and conduit/commercial mortgage-backed securities ("CMBS") programs. We retain the servicing rights and asset management responsibilities on substantially all loans we originate and sell under the GSE and HUD programs. We are an approved Fannie Mae Delegated Underwriting and Servicing ("DUS") lender nationally, a Freddie Mac Multifamily Conventional Loan lender, seller/servicer, in New York, New Jersey and Connecticut, a Freddie Mac affordable, manufactured housing, senior housing and small balance loan ("SBL") lender, seller/servicer, nationally and a HUD MAP and LEAN senior housing/healthcare lender nationally. We have operated the Agency Business since July 2016 when we acquired it from Arbor Commercial Mortgage, LLC (“ACM” or our “Former Manager”). We were externally managed and advised by ACM and, effective May 31, 2017, terminated the existing management agreement with ACM to fully internalize our management team. Refer to our 2017 Annual Report for details of our acquisition of the Agency Business (the “Acquisition”) and termination of the management agreement. Substantially all of our operations are conducted through our operating partnership, Arbor Realty Limited Partnership (“ARLP”), for which we serve as the general partner, and ARLP’s subsidiaries. We are organized to qualify as a real estate investment trust (“REIT”) for U.S. federal income tax purposes. Certain of our assets that produce non-qualifying income, primarily within the Agency Business, are operated through taxable REIT subsidiaries (“TRS”), which is part of our TRS consolidated group (the “TRS Consolidated Group”) and is subject to U.S. federal, state and local income taxes. See Note 17 - Income Taxes for details. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policies | 9 Months Ended |
Sep. 30, 2018 | |
Basis of Presentation and Significant Accounting Policies | |
Basis of Presentation and Significant Accounting Policies | Note 2 — Basis of Presentation and Significant Accounting Policies Basis of Presentation Our interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial statements and the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in the consolidated financial statements prepared under GAAP have been condensed or omitted. In our opinion, all adjustments considered necessary for a fair presentation of our financial position, results of operations and cash flows have been included and are of a normal and recurring nature. 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. These financial statements should be read in conjunction with our financial statements and notes thereto included in our 2017 Annual Report. Reclassification Certain prior period amounts have been reclassified to conform to the current period presentation. See the following “Recently Adopted Accounting Pronouncements” section for the cash flows impact of the retrospective adoption of Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows: Restricted Cash and ASU 2016-15, Statement of Cash Flows. Principles of Consolidation These consolidated financial statements include our financial statements and the financial statements of our wholly owned subsidiaries, partnerships and other joint ventures in which we own a controlling interest, including variable interest entities (“VIEs”) of which we are the primary beneficiary. Entities in which we have a significant influence are accounted for under the equity method. See Note 15 - Variable Interest Entities for information about our VIEs. All significant intercompany transactions and balances have been eliminated in consolidation. Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that could materially affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Significant Accounting Policies We describe our significant accounting policies in our 2017 Annual Report. There have been no significant changes in our significant accounting policies since December 31, 2017. Recently Adopted Accounting Pronouncements Description Adoption Date Effect on Financial Statements Since 2014, the Financial Accounting Standards Board ("FASB") has issued several amendments to its guidance on revenue recognition. The amended guidance, among other things, introduces a new framework for a single comprehensive model that can be used when accounting for revenue and supersedes most current revenue recognition guidance, including that which pertains to specific industries. The core principle states that an entity should recognize revenue to depict the transfer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for such goods and services. It also requires expanded quantitative and qualitative disclosures that will enable financial statement users to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Most revenue associated with financial instruments, including interest and loan origination fees, along with gains and losses on investment securities, derivatives and sales of financial instruments are excluded from the scope of the guidance. First quarter of 2018 The adoption of this guidance did not have a material impact on our consolidated financial statements. This standard may impact the timing of gains on certain future sales of real estate. In November 2016, the FASB issued Accounting Standards Update ("ASU") 2016-18, Statement of Cash Flows: Restricted Cash. This ASU requires changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents to be shown in the statement of cash flows. Previous guidance required the change in cash and cash equivalents be shown on the statement of cash flows, with cash used to fund restricted cash and restricted cash equivalents shown as a component of operating, investing, or financing activities. Entities are now also required to reconcile the total of cash, cash equivalents, restricted cash, and restricted cash equivalents as presented in the statement of cash flows to the related captions in the balance sheet when these balances are presented separately in the balance sheet. First quarter of 2018 This guidance required retrospective adoption, therefore, we adjusted the cash flow statement for the comparable prior period. The following table shows the impact of the adoption of this guidance, as well as the adoption of ASU 2016-15 described below. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows, which provides eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. First quarter of 2018 This guidance required retrospective adoption, therefore, we reclassified $0.5 million of net proceeds from insurance settlements from net cash provided by operating activities to net cash used in investing activities for the nine months ended September 30, 2017. We also chose the cummulative earnings approach for distributions received from equity method investees, which did not result in any changes in how we account for such distributions. The following table shows the impact of the adoption of ASU 2016-15 and ASU 2016-18. Nine Months Ended (in thousands) September 30, 2017 As previously reported under GAAP applicable at the time Cash and cash equivalents at beginning of period $ 138,645 Net decrease in cash and cash equivalents (53,894) Cash and cash equivalents at end of period 84,751 Net cash provided by operating activities: changes in operating assets and liabilities (6,252) Net cash used in investing activities (350,841) Net cash used in financing activities (90,954) As currently reported under ASU 2016-18 and ASU 2016-15 Cash, cash equivalents and restricted cash at beginning of period $ 167,960 Net increase in cash, cash equivalents and restricted cash 53,930 Cash, cash equivalents and restricted cash at end of period 221,890 Net cash (used in) provided by operating activities: changes in operating assets and liabilities (6,368) Net cash used in investing activities (350,348) Net cash provided by financing activities 16,840 In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall: Consensuses of the FASB Emerging Issues Task Force. This ASU requires that unconsolidated equity investments not accounted for under the equity method be recorded at fair value, with changes in fair value recorded through net income. The accounting principles that permitted available-for-sale classification with unrealized holding gains and losses recorded in other comprehensive income for equity securities will no longer be applicable. In addition, financial liabilities measured using the fair value option will need to present any change in fair value caused by a change in instrument-specific credit risk separately in other comprehensive income. First quarter of 2018 The adoption of this guidance did not have a material impact on our consolidated financial statements. In connection with the adoption of this ASU, we reclassified $0.2 million of unrealized gains on available-for-sale securities from accumulated other comprehensive income to accumulated deficit. Recently Issued Accounting Pronouncements The following table is not intended to represent all recently issued accounting pronouncements that are not yet effective and which have not yet been adopted by us. This table should be read in conjunction with the recently issued accounting pronouncements section included in our 2017 Annual Report. Description Effective Date Effect on Financial Statements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which makes a number of changes meant to add, modify or remove certain disclosure requirements associated with changes between hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements. Early adoption is permitted upon issuance of the update. First quarter of 2020 We do not expect the adoption of this guidance to have a significant impact to our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This ASU requires lessees to record most leases on their balance sheet through operating and finance lease liabilities and corresponding right-of-use assets, as well as adding additional footnote disclosures of key information about those arrangements. In July 2018, the FASB also issued ASU 2018-11, Leases (Topic 842) - Targeted Improvements, which provides transition releif on comparative period reporting through a cummulative-effect adjustment at the beginning of the period of adoption. First quarter of 2019 We are currently evaluating this ASU and expect the adoption to increase both our total assets and total liabilities by less than 1%. We do not currently expect the adoption to have an impact on our consolidated results of operations. |
Loans and Investments
Loans and Investments | 9 Months Ended |
Sep. 30, 2018 | |
Loans and Investments | |
Loans and Investments | Note 3 — Loans and Investments Our Structured Business loan and investment portfolio consists of ($ in thousands): Wtd. Avg. Remaining Wtd. Avg. Wtd. Avg. Percent of Loan Wtd. Avg. Months to First Dollar Last Dollar September 30, 2018 Total Count Pay Rate (1) Maturity LTV Ratio (2) LTV Ratio (3) Bridge loans $ 2,919,582 92 % 170 6.70 % 19.6 0 % 74 % Preferred equity investments 154,202 5 % 10 8.18 % 70.5 62 % 87 % Mezzanine loans 96,333 3 % 11 10.49 % 19.5 25 % 71 % 3,170,117 100 % 191 6.88 % 22.0 4 % 74 % Allowance for loan losses (60,951) Unearned revenue (11,477) Loans and investments, net $ 3,097,689 December 31, 2017 Bridge loans $ 2,422,105 91 % 150 % 0 % 72 % Preferred equity investments 142,892 6 % 12 % 64 % 90 % Mezzanine loans 87,541 3 % 8 % 20 % 63 % 2,652,538 100 % 170 % 4 % 73 % Allowance for loan losses (62,783) Unearned revenue (10,628) Loans and investments, net $ 2,579,127 (1) “Weighted Average Pay Rate” is a weighted average, based on the unpaid principal balance (“UPB”) of each loan in our portfolio, of the interest rate that is required to be paid monthly as stated in the individual loan agreements. Certain loans and investments that require an additional rate of interest “Accrual Rate” to be paid at maturity are not included in the weighted average pay rate as shown in the table. (2) The “First Dollar Loan-to-Value (“LTV”) Ratio” is calculated by comparing the total of our senior most dollar and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will absorb a total loss of our position. (3) The “Last Dollar LTV Ratio” is calculated by comparing the total of the carrying value of our loan and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will initially absorb a loss. Concentration of Credit Risk We are subject to concentration risk in that, at September 30, 2018, the UPB related to 48 loans with five different borrowers represented 23% of total assets. At December 31, 2017, the UPB related to 42 loans with five different borrowers represented 24% of total assets. During both the nine months ended September 30, 2018 and the year ended December 31, 2017, no single loan or investment represented more than 10% of our total assets and no single investor group generated over 10% of our revenue. We assign a credit risk rating of pass, pass/watch, special mention, substandard or doubtful to each loan and investment, with a pass rating being the lowest risk and a doubtful rating being the highest risk. Each credit risk rating has benchmark guidelines that pertain to debt-service coverage ratios, LTV ratios, borrower strength, asset quality, and funded cash reserves. Other factors such as guarantees, market strength, and remaining loan term and borrower equity are also reviewed and factored into determining the credit risk rating assigned to each loan. This metric provides a helpful snapshot of portfolio quality and credit risk. All portfolio assets are subject to, at a minimum, a thorough quarterly financial evaluation in which historical operating performance and forward-looking projections are reviewed, however, we maintain a higher level of scrutiny and focus on loans that we consider “high risk” and that possess deteriorating credit quality. Generally speaking, given our typical loan profile, risk ratings of pass, pass/watch and special mention suggest that we expect the loan to make both principal and interest payments according to the contractual terms of the loan agreement, and is not considered impaired. A risk rating of substandard indicates we anticipate the loan may require a modification of some kind. A risk rating of doubtful indicates we expect the loan to underperform over its term, and there could be loss of interest and/or principal. Further, while the above are the primary guidelines used in determining a certain risk rating, subjective items such as borrower strength, market strength or asset quality may result in a rating that is higher or lower than might be indicated by any risk rating matrix. As a result of the loan review process, at September 30, 2018 and December 31, 2017, we identified eight loans and investments that we consider higher-risk loans that had a carrying value, before loan loss reserves, of $128.7 million and $126.5 million, respectively, and a weighted average last dollar LTV ratio of 92% and 93%, respectively. A summary of the loan portfolio’s weighted average internal risk ratings and LTV ratios by asset class is as follows ($ in thousands): September 30, 2018 Wtd. Avg. Wtd. Avg. Wtd. Avg. Percentage of Internal Risk First Dollar Last Dollar Asset Class UPB Portfolio Rating LTV Ratio LTV Ratio Multifamily $ 2,378,771 75 % pass/watch 4 % 74 % Self Storage 301,830 10 % pass/watch 0 % 72 % Land 151,628 5 % substandard 0 % 84 % Office 127,055 4 % special mention 0 % 66 % Healthcare 107,775 3 % pass/watch 0 % 81 % Hotel 55,975 2 % pass/watch 23 % 74 % Retail 45,383 1 % pass/watch 7 % 66 % Commercial 1,700 <1 % doubtful 63 % 63 % Total $ 3,170,117 100 % pass/watch 4 % 74 % December 31, 2017 Multifamily $ 1,925,529 73 % pass/watch 4 % 72 % Self Storage 301,830 11 % pass 0 % 71 % Land 132,828 5 % substandard 0 % 90 % Office 107,853 4 % pass/watch 1 % 64 % Healthcare 55,615 2 % pass/watch 0 % 74 % Hotel 90,725 3 % special mention 37 % 81 % Retail 36,458 1 % pass/watch 8 % 66 % Commercial 1,700 <1 % doubtful 63 % 63 % Total $ 2,652,538 100 % pass/watch 4 % 73 % Geographic Concentration Risk As of September 30, 2018, 22% and 19% of the outstanding balance of our loan and investment portfolio had underlying properties in New York and Texas, respectively. As of December 31, 2017, 23%, 21% and 11% of the outstanding balance of our loan and investment portfolio had underlying properties in Texas, New York and California, respectively. No other states represented 10% or more of the total loan and investment portfolio. Impaired Loans and Allowance for Loan Losses A summary of the changes in the allowance for loan losses is as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Allowance at beginning of period $ 58,733 $ 81,256 $ 62,783 $ 83,712 Provision for loan losses 2,218 2,000 3,868 2,000 Recoveries of reserves — — (2,527) (2,456) Charge-offs — — (3,173) — Allowance at end of period $ 60,951 $ 83,256 $ 60,951 $ 83,256 During the three and nine months ended September 30, 2018, we determined that the fair value of the underlying collateral (land development project) securing six loans with a carrying value of $121.4 million was less than the net carrying value of the loans, which resulted in a provision for loan losses of $0.5 million and $2.2 million, respectively. In addition, we fully reserved a bridge loan and recorded a provision for loan loss of $1.7 million during the three and nine months ended September 30, 2018. During the nine months ended September 30, 2018, we received $31.6 million to settle a non-performing preferred equity investment in a hotel property with a UPB of $34.8 million and a net carrying value of $29.1 million, resulting in a reserve recovery of $2.5 million and a charge-off of $3.2 million. In addition, during the three and nine months ended September 30, 2018, we received payments and recorded reserve recoveries of $1.4 million and $2.3 million, respectively, related to previously written-off loans and investments. During the three and nine months ended September 30, 2017, we determined that the fair value of the underlying collateral securing a preferred equity investment with an aggregate carrying value of $34.8 million was less than the net carrying value of the investment, resulting in a $2.0 million provision for loan losses. In addition, during the nine months ended September 30, 2017, a fully reserved mezzanine loan with a UPB of $1.8 million paid off in full, which resulted in a $1.8 million reserve recovery, and we recorded a reserve recovery of $0.7 million on a multifamily bridge loan. The ratio of net recoveries to the average loans and investments outstanding was de minimus for the three months ended September 30, 2018 and 0.1% for all other periods presented. There were no loans for which the fair value of the collateral securing the loan was less than the carrying value of the loan for which we had not recorded a provision for loan loss as of September 30, 2018 and 2017. We have six loans with a carrying value totaling $121.4 million at September 30, 2018 that are collateralized by a land development project. These loans were scheduled to mature in September 2018 and were extended to September 2019. The loans do not carry a current pay rate of interest, but five of the loans with a carrying value totaling $112.0 million entitle us to a weighted average accrual rate of interest of 8.97%. In 2008, we suspended the recording of the accrual rate of interest on these loans, as they were impaired and we deemed the collection of this interest to be doubtful. At September 30, 2018 and December 31, 2017, we had cumulative allowances for loan losses of $51.2 million and $49.1 million, respectively, related to these loans. The loans are subject to certain risks associated with a development project including, but not limited to, availability of construction financing, increases in projected construction costs, demand for the development's outputs upon completion of the project, and litigation risk. Additionally, these loans were not classified as non-performing as the borrower is in compliance with all of the terms and conditions of the loans. A summary of our impaired loans by asset class is as follows (in thousands): September 30, 2018 Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Allowance for Average Recorded Interest Income Average Recorded Interest Income Asset Class UPB Carrying Value (1) Loan Losses Investment (2) Recognized Investment (2) Recognized Land $ 134,215 $ 127,886 $ 57,751 $ 133,387 $ 26 $ 132,651 $ 75 Hotel — — — — — 17,375 — Office 2,274 2,274 1,500 2,277 33 2,281 93 Commercial 1,700 1,700 1,700 1,700 — 1,700 — Total $ 138,189 $ 131,860 $ 60,951 $ 137,364 $ 59 $ 154,007 $ 168 December 31, 2017 Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Land $ 131,086 $ 124,812 $ 53,883 $ 131,086 $ — $ 131,086 $ — Hotel 34,750 34,750 5,700 34,750 — 34,750 371 Office 2,288 2,288 1,500 27,551 28 27,556 79 Commercial 1,700 1,700 1,700 1,700 — 1,700 — Multifamily — — — — — 1,271 22 Total $ 169,824 $ 163,550 $ 62,783 $ 195,087 $ 28 $ 196,363 $ 472 (1) Represents the UPB of five and four impaired loans (less unearned revenue and other holdbacks and adjustments) by asset class at September 30, 2018 and December 31, 2017, respectively. (2) Represents an average of the beginning and ending UPB of each asset class. At September 30, 2018, two loans with an aggregate net carrying value of $0.8 million, net of related loan loss reserves of $1.7 million, were classified as non-performing. At December 31, 2017, two loans with an aggregate net carrying value of $29.1 million, net of related loan loss reserves of $7.4 million, were classified as non-performing. Income from non-performing loans is generally recognized on a cash basis when it is received. Full income recognition will resume when the loan becomes contractually current and performance has recommenced. A summary of our non-performing loans by asset class is as follows (in thousands): September 30, 2018 December 31, 2017 Greater Than Greater Than Carrying Less Than 90 90 Days Past Carrying Less Than 90 90 Days Past Asset Class Value Days Past Due Due Value Days Past Due Due Commercial $ 1,700 $ — $ 1,700 $ 1,700 $ — $ 1,700 Hotel — — — 34,750 — 34,750 Office 831 — 831 — — — Total $ 2,531 $ — $ 2,531 $ 36,450 $ — $ 36,450 At both September 30, 2018 and December 31, 2017, there were no loans contractually past due 90 days or more that were still accruing interest. There were no loan modifications, refinancing's and/or extensions during the nine months ended September 30, 2018 that were considered troubled debt restructurings. During the nine months ended September 30, 2017, there was a $34.8 million loan to a hotel property that was modified and considered a troubled debt restructuring as a result of a forbearance agreement entered into with the borrower in the second quarter of 2017. This loan was subsequently classified as non-performing. This loan was modified to increase the total recovery of the combined principal and interest. There were no other loans in which we considered the modifications to be troubled debt restructurings and no additional loans considered to be impaired as a result of our troubled debt restructuring analysis performed during the nine months ended September 30, 2018 and 2017. Given the transitional nature of some of our real estate loans, we may require funds to be placed into an interest reserve, based on contractual requirements, to cover debt service costs. At September 30, 2018, we had total interest reserves of $41.3 million on 98 loans with an aggregate UPB of $2.01 billion. At December 31, 2017, we had total interest reserves of $52.5 million on 81 loans with an aggregate UPB of $1.57 billion. |
Loans Held-for-Sale, Net
Loans Held-for-Sale, Net | 9 Months Ended |
Sep. 30, 2018 | |
Loans Held-for-Sale, Net | |
Loans Held-for-Sale, Net | Note 4 — Loans Held-for-Sale, Net Loans held-for-sale, net consists of the following (in thousands): September 30, 2018 December 31, 2017 Fannie Mae $ 332,719 $ 243,717 Freddie Mac 133,441 47,545 FHA 26,806 987 492,966 292,249 Fair value of future MSR 8,459 5,806 Unearned discount (1,144) (612) Loans held-for-sale, net $ 500,281 $ 297,443 Our loans held-for-sale, net are typically sold within 60 days of loan origination and the gain on sales are included in gain on sales, including f ee-based services, net in the consolidated statements of income . During the three and nine months ended September 30, 2018, we sold $1.19 billion and $3.27 billion, respectively, of loans held-for-sale and recorded gain on sales of $15.9 million and $48.1 million, respectively . During the three and nine months ended September 30, 2017, we sold $1.05 billion and $3.62 billion, respectively, of loans held-for-sale and recorded gains on sales of $16.3 million and $52.1 million, respectively. At September 30 , 2018 and December 31, 2017, there were no loans held-for-sale that were 90 days or more past due, and there were no loans held-for-sale that were placed on a non-accrual status. |
Capitalized Mortgage Servicing
Capitalized Mortgage Servicing Rights | 9 Months Ended |
Sep. 30, 2018 | |
Capitalized Mortgage Servicing Rights | |
Capitalized Mortgage Servicing Rights | Note 5 — Capitalized Mortgage Servicing Rights Our capitalized mortgage servicing rights (“MSRs”) reflect commercial real estate MSRs derived from loans sold in our Agency Business. The discount rates used to determine the present value of our MSRs throughout the periods presented for all MSRs were between 8% - 15% (representing a weighted average discount rate of 12%) based on our best estimate of market discount rates. The weighted average estimated life remaining of our MSRs was 7.4 years and 7.2 years at September 30, 2018 and December 31, 2017, respectively. A summary of our capitalized MSR activity is as follows (in thousands): Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Acquired Originated Total Acquired Originated Total Balance at beginning of period $ 120,017 $ 137,004 $ 257,021 $ 143,270 $ 109,338 $ 252,608 Additions — 21,368 21,368 — 59,660 59,660 Amortization (7,052) (4,786) (11,838) (22,564) (13,075) (35,639) Write-downs and payoffs (4,419) (2,731) (7,150) (12,160) (5,068) (17,228) Balance at end of period $ 108,546 $ 150,855 $ 259,401 $ 108,546 $ 150,855 $ 259,401 Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Balance at beginning of period $ 168,189 $ 74,894 $ 243,083 $ 194,801 $ 32,942 $ 227,743 Additions — 20,720 20,720 — 66,273 66,273 Amortization (8,952) (2,759) (11,711) (29,074) (6,353) (35,427) Write-downs and payoffs (4,194) (22) (4,216) (10,684) (29) (10,713) Balance at end of period $ 155,043 $ 92,833 $ 247,876 $ 155,043 $ 92,833 $ 247,876 We collected prepayment fees of $7.5 million and $16.2 million during the three and nine months ended September 30, 2018, respectively, which are included as a component of servicing revenue, net on the consolidated statements of income. During the three and nine months ended September 30, 2017, we collected prepayment fees totaling $3.8 million and $7.9 million, respectively. As of September 30, 2018 and December 31, 2017, we had no valuation allowance recorded on any of our MSRs. The expected amortization of capitalized MSRs recorded as of September 30, 2018 is shown in the table below (in thousands). Actual amortization may vary from these estimates. Year Amortization 2018 (three months ending 12/31/2018) $ 12,000 2019 45,946 2020 41,383 2021 34,919 2022 28,357 2023 23,850 Thereafter 72,946 Total $ 259,401 |
Mortgage Servicing
Mortgage Servicing | 9 Months Ended |
Sep. 30, 2018 | |
Mortgage Servicing | |
Mortgage Servicing | Note 6 — Mortgage Servicing Product and geographic concentrations that impact our servicing revenue are as follows ($ in thousands): September 30, 2018 Product Concentrations Geographic Concentrations UPB Percent of Percentage Product UPB Total State of Total Fannie Mae $ 13,195,643 74 % Texas 21 % Freddie Mac 3,977,619 22 % North Carolina 10 % FHA 621,419 4 % California 8 % Total $ 17,794,681 100 % New York 8 % Georgia 6 % Florida 6 % Other (1) 41 % Total 100 % December 31, 2017 Product Concentrations Geographic Concentrations UPB Percent of Percentage Product UPB Total State of Total Fannie Mae $ 77 % Texas 22 % Freddie Mac 3,166,134 20 % North Carolina 10 % FHA 537,482 3 % California 8 % Total $ 100 % New York 8 % Georgia 6 % Florida 6 % Other (1) 40 % Total 100 % (1) No other individual state represented 4% or more of the total. At September 30, 2018 and December 31, 2017, our weighted average servicing fee was 46.2 basis points and 47.7 basis points, respectively. At September 30, 2018 and December 31, 2017, we held total escrow balances of $806.6 million and $750.8 million, respectively, which is not reflected in our consolidated balance sheets. Of the total escrow balances, we held $567.3 million and $477.9 million at September 30, 2018 and December 31, 2017, respectively, related to loans we are servicing within our Agency Business. These escrows are maintained in separate accounts at several federally insured depository institutions, which may exceed FDIC insured limits. We earn interest income on the total escrow deposits, generally based on a market rate of interest negotiated with the financial institutions that hold the escrow deposits. Interest earned on total escrows, net of interest paid to the borrower, was $3.7 million and $8.6 million during the three and nine months ended September 30, 2018, respectively, and $1.5 million and $3.3 million during the three and nine months ended September 30, 2017, respectively, and is a component of servicing revenue, net in the consolidated statements of income. |
Securities Held-to-Maturity
Securities Held-to-Maturity | 9 Months Ended |
Sep. 30, 2018 | |
Securities Held-to-Maturity | |
Securities Held-to-Maturity | Note 7 — Securities Held-to-Maturity Freddie Mac may choose to hold, sell or securitize loans we sell to them under the Freddie Mac SBL program. As part of the securitizations under the SBL program, we have the option to purchase the bottom tranche bond, generally referred to as the “B Piece,” that represents the bottom 10%, or highest risk, of the securitization. During the nine months ended September 30, 2018, we purchased two B Piece bonds with an initial face value of $31.2 million, at a discount, for $21.6 million. As of September 30, 2018, we retained 49%, or $72.2 million initial face value, of five B Piece bonds, which were purchased at a discount for $48.8 million, and sold the remaining 51% to a third party at par. These held-to-maturity securities are carried at cost, net of unamortized discounts, and are collateralized by a pool of multifamily mortgage loans, bear interest at an initial weighted average variable rate of 3.63% and have an estimated weighted average maturity of 5.7 years. The weighted average effective interest rate was 11.32% and 12.97% at September 30, 2018 and December 31, 2017, respectively, including the accretion of discount. Approximately $10.7 million is estimated to mature within one year, $30.6 million is estimated to mature after one year through five years, $20.0 million is estimated to mature after five years through ten years and $9.2 million is estimated to mature after ten years. The following is a summary of our B Piece bonds classified as securities held-to-maturity (in thousands): Unrealized Estimated Fair Period Face Value Carrying Value Gain Value September 30, 2018 $ 70,518 $ 50,520 $ 1,792 $ 52,312 December 31, 2017 $ 40,566 $ 27,837 $ 602 $ 28,439 As of September 30, 2018, no impairment was recorded on these held-to-maturity securities. During the three and nine months ended September 30, 2018, we recorded interest income of $0.6 million and $1.7 million, respectively, and, during the three and nine months ended September 30, 2017, we recorded interest income of $0.5 million and $0.9 million, respectively, related to these investments. |
Investments in Equity Affiliate
Investments in Equity Affiliates | 9 Months Ended |
Sep. 30, 2018 | |
Investments in Equity Affiliates | |
Investments in Equity Affiliates | Note 8 — Investments in Equity Affiliates We account for all investments in equity affiliates under the equity method. The following is a summary of our investments in equity affiliates (in thousands): UPB of Loans to Investments in Equity Affiliates at Equity Affiliates at Equity Affiliates September 30, 2018 December 31, 2017 September 30, 2018 Arbor Residential Investor LLC $ 19,781 $ 19,193 $ — Lightstone Value Plus REIT L.P. 1,895 1,895 — JT Prime 425 425 — West Shore Café — 2,140 1,688 East River Portfolio — — — Lexford Portfolio — — 280,500 Total $ 22,101 $ 23,653 $ 282,188 Arbor Residential Investor LLC (“ARI”) . During the three and nine months ended September 30, 2018, we recorded income of $0.4 million and $1.2 million, respectively, and, during the three and nine months ended September 30, 2017, we recorded a loss of $1.3 million and $1.9 million, respectively, to (loss) income from equity affiliates in our consolidated statements of income related to our investment in this residential mortgage banking business. In addition, during the first quarter of 2018, we made a $2.4 million payment for our proportionate share of a litigation settlement related to this investment, which was distributed back to us by our equity affiliate. During the nine months ended September 30, 2018 and 2017, we received cash distributions totaling $0.7 million and $0.9 million, respectively, (which were classified as returns of capital) in connection with a joint venture that invests in non-qualified residential mortgages purchased from ARI’s origination platform . The income associated with this investment for all periods presented were de minimus. West Shore Café. We own a 50% noncontrolling interest in the West Shore Lake Café, a restaurant/inn lakefront property in Lake Tahoe, California. We provided a $1.7 million first mortgage loan to an affiliated entity to acquire property adjacent to the original property, which is scheduled to mature in May 2019 and bears interest at LIBOR plus 4.0%. Current accounting guidance requires investments in equity affiliates to be evaluated periodically to determine whether a decline in their value is other-than-temporary, though it is not intended to indicate a permanent decline in value. During the three months ended September 30, 2018, we determined that this investment exhibited indicators of impairment and, as a result of an impairment analysis performed; we recorded an other-than-temporary impairment of $2.2 million for the full carrying amount of this investment, which was recorded in (loss) income from equity affiliates in the consolidated statement of income. In addition, during the three months ended September 30, 2018, we recorded a provision for loan loss of $1.7 million, fully reserving the first mortgage loan. Lexford Portfolio. During the three and nine months ended September 30, 2018, we received distributions of $0.7 million and $1.9 million, respectively, and, during the three and nine months ended September 30, 2017, we received distributions of $0.7 million and $2.0 million, respectively, from this equity investment, which was recognized as income. See Note 18 - Agreements and Transactions with Related Parties for details. Equity Participation Interest. In the third quarter of 2017, we received $1.5 million from the redemption of a 25% equity participation interest we held in a multifamily property, which is included in (loss) income from equity affiliates on the consolidated statements of income. Prior to this transaction, our basis in this investment was zero. |
Real Estate Owned
Real Estate Owned | 9 Months Ended |
Sep. 30, 2018 | |
Real Estate Owned | |
Real Estate Owned | Note 9 — Real Estate Owned Our real estate assets at both September 30, 2018 and December 31, 2017 were comprised of a hotel property and an office building. Real Estate Owned September 30, 2018 December 31, 2017 Hotel Office Hotel Office (in thousands) Property Building Total Property Building Total Land $ 3,294 $ 4,509 $ 7,803 $ 3,294 $ 4,509 $ 7,803 Building and intangible assets 31,008 2,010 33,018 30,699 2,010 32,709 Less: Impairment loss (13,307) (2,500) (15,807) (13,307) (500) (13,807) Less: Accumulated depreciation and amortization (9,642) (809) (10,451) (9,228) (690) (9,918) Real estate owned, net $ 11,353 $ 3,210 $ 14,563 $ 11,458 $ 5,329 $ 16,787 For the nine months ended September 30, 2018 and 2017, our hotel property had a weighted average occupancy rate of 54% and 55%, respectively, a weighted average daily rate of $113 for both periods and weighted average revenue per available room of $61 and $62, respectively. The operation of a hotel property is seasonal with the majority of revenues earned in the first two quarters of the calendar year. Of the total impairment losses recorded on our hotel property of $13.3 million, $2.7 million was recorded during the nine months ended September 30, 2017. Our office building was fully occupied by a single tenant until April 2017 when the lease expired. The building is currently vacant. During the nine months ended September 30, 2018, based on discussions with market participants, we determined that the office building exhibited indicators of impairment and performed an impairment analysis. As a result of this impairment analysis, we recorded an impairment loss of $2.0 million. Our real estate owned assets had restricted cash balances totaling $0.8 million and $0.7 million at September 30, 2018 and December 31, 2017, respectively, due to escrow requirements. |
Debt Obligations
Debt Obligations | 9 Months Ended |
Sep. 30, 2018 | |
Debt Obligations | |
Debt Obligations | Note 10 — Debt Obligations Credit Facilities and Repurchase Agreements The following table outlines borrowings under our credit facilities and repurchase agreements ($ in thousands): September 30, 2018 December 31, 2017 Debt Collateral Wtd. Debt Collateral Wtd. Current Extended Carrying Carrying Avg. Note Carrying Carrying Avg. Note Structured Business Maturity Maturity Note Rate Value (1) Value Rate Value (1) Value Rate $375 million repurchase facility Mar. 2020 Mar. 2021 L+ 1.75 % to 3.50 % $ 334,582 $ 470,650 4.53 % $ 102,350 $ 145,850 3.90 % $100 million repurchase facility June 2019 June 2020 L+ 1.75 % to 2.00 % 94,024 132,107 4.09 % 2,445 6,600 3.61 % $75 million credit facility Dec. 2018 N/A L+ 1.75 % to 2.50 % 20,355 30,469 4.07 % — — — $75 million credit facility June 2019 N/A L+ 2.00 % 14,482 21,000 4.32 % 8,999 16,000 3.61 % $50 million credit facility Feb. 2019 N/A L+ 2.00 % 28,557 35,700 4.32 % 32,538 40,700 3.61 % $50 million credit facility Sept. 2019 Sept. 2021 L+ 2.50 % to 3.25 % — — — 3,581 4,625 4.88 % $25.5 million credit facility Oct. 2019 N/A L+ 2.50 % 15,773 34,000 4.83 % 13,920 18,753 4.12 % $25 million working capital facility June 2019 N/A L+ 2.25 % — — — 10,000 — 4.12 % $23.2 million credit facility Feb. 2020 Feb. 2021 L+ 2.30 % 23,068 30,900 4.62 % — — — $20 million credit facility Mar. 2020 Mar. 2021 L+ 2.50 % 19,904 41,650 4.83 % — — — $17.4 million credit facility June 2020 June 2021 L+ 2.40 % 12,405 15,844 4.73 % — — — $8 million credit facility Aug. 2021 N/A L+ 2.50 % 7,941 10,000 4.83 — — — $7.5 million credit facility (2) Sept. 2018 N/A L+ 2.75 % — — — 7,432 9,340 4.37 % Repurchase facility - securities (3) N/A N/A L+ 2.35 % to 3.25 % 102,701 — 4.97 % 53,938 — 4.45 % $3 million master security agreement Oct. 2020 N/A 2.96 % to 3.42 % 1,337 — 3.20 % 1,834 — 3.21 % $2.2 million master security agreement Mar. 2021 N/A 4.60 % 1,854 — 4.66 % — — — Structured Business total $ 676,983 $ 822,320 4.53 % $ 237,037 $ 241,868 4.02 % Agency Business $500 million ASAP agreement (4) N/A N/A L+ 1.05 % $ 96,617 $ 96,617 3.31 % $ 121,880 $ 121,880 2.61 % $250 million credit facility (5) June 2019 N/A L+ 1.25 % 102,180 102,182 3.51 % 23,785 23,785 2.86 % $200 million repurchase facility Aug. 2019 N/A L+ 1.275 % 73,573 73,573 3.54 % 24,827 24,873 2.91 % $150 million credit facility Jan . 2019 N/A L+ 1.30 % 136,567 136,644 3.56 % 21,802 21,821 2.96 % $150 million credit facility July 2019 N/A L+ 1.30 % 83,666 83,783 3.56 % 99,242 99,357 2.91 % Agency Business total $ 492,603 $ 492,799 3.50 % $ 291,536 $ 291,716 2.78 % Consolidated total $ 1,169,586 $ 1,315,119 4.10 % $ 528,573 $ 533,584 3.34 % (1) The debt carrying value for the Structured Business at September 30, 2018 and December 31, 2017 was net of unamortized deferred finance costs of $2.6 million and $2.2 million, respectively. The debt carrying value for the Agency Business at both September 30, 2018 and December 31, 2017 was net of unamortized deferred finance costs of $0.2 million. (2) In September 2018, the loan collateralizing this facility paid off and we simultaneously repaid this facility. (3) As of September 30, 2018 and December 31, 2017, this facility was collateralized by CLO bonds retained by us with a principal balance of $114.2 million and $61.0 million, respectively, and B Piece bonds with a carrying value of $50.5 million and $27.8 million, respectively. (4) The note rate under this agreement is subject to a LIBOR Floor of 35 basis points. (5) The committed amount under the facility was temporarily increased $150.0 million to $250.0 million, which expires in January 2019. Structured Business At September 30, 2018 and December 31, 2017, the weighted average interest rate for the credit facilities and repurchase agreements of our Structured Business, including certain fees and costs, such as structuring, commitment, non-use and warehousing fees, was 4.86% and 4.51%, respectively. The leverage on our loans and investment portfolio financed through our credit facilities and repurchase agreements, excluding the securities repurchase facility, working capital line of credit and the security agreements used to finance leasehold and capital expenditure improvements at our corporate office, was 70% and 72% at September 30, 2018 and December 31, 2017, respectively. In September 2018, we entered into an $8.0 million credit facility to finance a healthcare facility bridge loan. The facility bears interest at a rate of 250 basis points over LIBOR and matures in August 2021. In June 2018, we entered into a $17.4 million credit facility to finance a multifamily bridge loan. The facility bears interest at a rate of 240 basis points over LIBOR and matures in June 2020, with a one-year extension option. In June 2018, we amended our $10.0 million working capital facility to increase the committed amount by $15.0 million to $25.0 million, reduce the interest rate by 25 basis points and extend the maturity to June 2019. In April 2018, we amended our $100.0 million repurchase facility adjusting the interest rate from 200 basis points over LIBOR to an interest rate range of 175 basis points to 200 basis points over LIBOR, depending on the class of loan financed. In April 2018, we amended our $75.0 million credit facility adjusting the interest rate range from 200 basis points to 250 basis points over LIBOR to an interest rate range of 175 basis points to 250 basis points over LIBOR, depending on the type of loan financed. In March 2018, we amended our $225.0 million repurchase facility to increase the committed amount by $75.0 million to $300.0 million, reduce the interest rates by 50 basis points and extend the maturity to March 2020 with a one-year extension option. In June 2018, we also temporarily increased the committed amount by $75.0 million to $375.0 million, which expires in December 2018. In March 2018, we entered into a $20.0 million credit facility to finance a healthcare facility bridge loan. The facility bears interest at a rate of 250 basis points over LIBOR and matures in March 2020, with a one-year extension option. In March 2018, we entered into a master security agreement to finance certain capital expenditures. We have a $2.2 million note payable under this agreement which bears interest at a fixed rate of 4.60%, requires monthly amortization payments and matures in March 2021. In February 2018, we entered into a $23.2 million credit facility to finance a self storage bridge loan. The facility bears interest at a rate of 230 basis points over LIBOR and matures in February 2020, with a one-year extension option. Agency Business In August 2018, we amended our $100.0 million repurchase facility to increase the committed amount by $100.0 million to $200.0 million, reduced the interest rate from 135 basis points over LIBOR to 127.5 basis points over LIBOR and extended the maturity to August 2019. In August 2018, we increased our letter of credit outstanding with Fannie Mae by $2.0 million to $44.0 million. Our letters of credit outstanding at September 30, 2018 also includes a $5.0 million letter of credit for the Freddie Mac SBL program. In April 2018, we amended our $150.0 million credit facility reducing the interest rate 5 basis points to 130 basis points over LIBOR, and, in August 2018, we amended this facility extending the maturity to July 2019. In January 2018, we amended our $150.0 million warehouse facility reducing the interest rate 10 basis points to 130 basis points over LIBOR and extending the maturity to January 2019. Collateralized Loan Obligations (“CLOs”) We account for CLO transactions on our consolidated balance sheet as financing facilities. Our CLOs are VIEs for which we are the primary beneficiary and are consolidated in our financial statements. The investment grade tranches are treated as secured financings, and are non-recourse to us. The following table outlines borrowings and the corresponding collateral under our CLOs ($ in thousands): Debt Collateral (3) Loans Cash Face Carrying Wtd. Avg. Carrying Restricted September 30, 2018 Value Value (1) Rate (2) UPB Value Cash (4) CLO X $ 441,000 $ 436,132 3.76 % $ 510,303 $ 508,357 $ 42,032 CLO IX 356,400 351,934 3.67 % 417,089 415,776 3,911 CLO VIII 282,874 279,538 3.62 % 304,078 303,302 39,409 CLO VII 279,000 276,221 4.31 % 285,134 284,322 43,885 CLO VI 250,250 248,264 4.81 % 276,083 275,086 40,342 Total CLOs $ 1,609,524 $ 1,592,089 3.98 % $ 1,792,687 $ 1,786,843 $ 169,579 December 31, 2017 CLO IX $ 356,400 $ 351,042 2.97 % $ 372,350 $ 371,236 $ 88,650 CLO VIII 282,874 278,606 2.92 % 364,838 363,339 162 CLO VII 279,000 275,331 3.61 % 346,524 345,220 13,476 CLO VI 250,250 247,470 4.10 % 314,382 313,582 10,618 CLO V 267,750 265,973 4.06 % 347,797 346,803 2,203 Total CLOs $ 1,436,274 $ 1,418,422 3.48 % $ 1,745,891 $ 1,740,180 $ 115,109 (1) Debt carrying value is net of $17.4 million and $17.9 million of deferred financing fees at September 30, 2018 and December 31, 2017, respectively. (2) At September 30, 2018 and December 31, 2017, the aggregate weighted average note rate for our CLOs, including certain fees and costs, was 4.49% and 4.08%, respectively. (3) As of September 30, 2018 and December 31, 2017, there was no collateral at risk of default or deemed to be a “credit risk” as defined by the CLO indenture. (4) Represents restricted cash held for principal repayments as well as for reinvestment in the CLOs. Does not include restricted cash related to interest payments, delayed fundings and expenses. CLO X - In June 2018, we completed a collateralized securitization vehicle ("CLO X"), issuing seven tranches of CLO notes through two newly-formed wholly-owned subsidiaries totaling $494.2 million. Of the total CLO notes issued, $441.0 million were investment grade notes issued to third party investors and $53.2 million were below investment grade notes retained by us. As of the CLO closing date, the notes were secured by a portfolio of loan obligations with a face value of $501.9 million, consisting primarily of bridge loans that were contributed from our existing loan portfolio. The financing has a four-year replacement period that allows the principal proceeds and sale proceeds (if any) of the loan obligations to be reinvested in qualifying replacement loan obligations, subject to the satisfaction of certain conditions set forth in the indenture. Thereafter, the outstanding debt balance will be reduced as loans are repaid. Initially, the proceeds of the issuance of the securities also included $58.1 million for the purpose of acquiring additional loan obligations for a period of up to 120 days from the CLO closing date, which we subsequently utilized, resulting in the issuer owning loan obligations with a face value of $560.0 million, representing leverage of 79%. We retained a residual interest in the portfolio with a notional amount of $119.0 million, including the $53.2 million below investment grade notes. The notes had an initial weighted average interest rate of 1.45% plus one-month LIBOR and interest payments on the notes are payable monthly. CLO V - In June 2018, we completed the unwind of CLO V, redeeming $267.8 million of outstanding notes which were repaid primarily from the refinancing of the remaining assets within our existing financing facilities (including CLO X), as well as with cash held by CLO V, and expensed $1.3 million of deferred financing fees into interest expense on the consolidated statements of income. Luxembourg Debt Fund In November 2017, we formed a $100.0 million Luxembourg commercial real estate debt fund ("Debt Fund") and issued $70.0 million of floating rate notes to third party investors which bear an initial interest rate of 4.15% over LIBOR. The notes mature in 2025 and we retained a $30.0 million equity interest in the Debt Fund. The Debt Fund is a VIE for which we are the primary beneficiary and is consolidated in our financial statements. The Debt Fund is secured by a portfolio of loan obligations with a face value of $100.0 million, which includes first mortgage bridge loans, senior participation interests in first mortgage bridge loans, subordinate participation interest in first mortgage bridge loans and participation interests in mezzanine loans. The Debt Fund allows, for a period of three years, principal proceeds from portfolio assets to be reinvested in qualifying replacement assets, subject to certain conditions. Borrowings and the corresponding collateral under our Debt Fund are as follows ($ in thousands): Debt Collateral (3) Loans Cash Face Carrying Wtd. Avg. Carrying Restricted Period Value Value (1) Rate (2) UPB Value Cash (4) September 30, 2018 $ 70,000 $ 68,099 6.50 % $ 98,696 $ 98,261 $ — December 31, 2017 $ 70,000 $ 68,084 5.79 % $ 96,995 $ 96,564 $ 3,005 (1) Debt carrying value is net of $1.9 million of deferred financing fees at both September 30, 2018 and December 31, 2017. (2) At September 30, 2018 and December 31, 2017, the aggregate weighted average note rate, including certain fees and costs, was 7.08% and 6.05%, respectively. (3) At both September 30, 2018 and December 31, 2017, there was no collateral at risk of default or deemed to be a “credit risk.” (4) Represents restricted cash held for reinvestment. Excludes restricted cash related to interest payments, delayed fundings and expenses. Senior Unsecured Notes In March 2018, we issued $100.0 million aggregate principal amount of 5.625% senior unsecured notes due in May 2023 (the "Initial Notes") in a private placement, and, in May 2018, we issued an additional $25.0 million (the "Reopened Notes" and, together with the Initial Notes, the "5.625% Notes,") which brought the aggregate outstanding principal amount to $125.0 million. The Reopened Notes are fully fungible with, and rank equally in right of payment with the Initial Notes. We received total proceeds of $122.3 million from the issuances, after deducting the underwriting discount and other offering expenses. We used the net proceeds from the Initial Notes to fully redeem our 7.375% senior unsecured notes due in 2021 (the “7.375% Notes") totaling $97.9 million and the net proceeds from the Reopened Notes to make investments and for general corporate purposes. The 5.625% Notes are unsecured and can be redeemed by us at any time prior to April 1, 2023, at a redemption price equal to 100% of the aggregate principal amount, plus a "make-whole" premium and accrued and unpaid interest. We have the right to redeem the 5.625% Notes on or after April 1, 2023, at a redemption price equal to 100% of the aggregate principal amount, plus accrued and unpaid interest. The interest is paid semiannually in May and November starting in November 2018. At September 30, 2018, the debt carrying value of the 5.625% Notes was $122.4 million, net of $2.6 million of deferred financing fees, and the weighted average note rate was 6.08%, including certain fees and costs. At December 31, 2017, the debt carrying value of our 7.375% Notes was $95.3 million, which was net of $2.6 million of deferred financing fees, and the weighted average note rate was 8.16%. Convertible Senior Unsecured Notes We issued $264.5 million in aggregate principal amount of 5.25% convertible senior notes (the "5.25% Convertible Notes”) through two separate private placement offerings during the three months ended September 30, 2018, which includes the exercised purchaser’s total over-allotment option of $34.5 million. The 5.25% Convertible Notes pay interest semiannually in arrears and are scheduled to mature in July 2021, unless earlier converted or repurchased by the holders pursuant to their terms. The initial conversion rates of the two offerings ($115.0 million issued on July 3, 2018 and $149.5 million issued on July 20, 2018) were 86.9943 shares and 77.8331 shares of common stock per $1,000 of principal, respectively, representing a conversion price of $11.50 per share and $12.85 per share of common stock, respectively. The initial conversion rates and conversion prices remain unchanged at September 30, 2018. We received proceeds totaling $256.1 million from the offerings of our 5.25% Convertible Notes, net of the underwriter’s discount and fees, which is being amortized through interest expense over the life of such notes. We used the net proceeds from the issuance primarily for the initial exchange of $127.6 million of our 5.375% convertible senior unsecured notes (the “5.375% Convertible Notes”) and $99.8 million of our 6.50% convertible senior unsecured notes (the “6.50% Convertible Notes”) for a combination of $219.8 million in cash (which includes accrued interest) and 6.8 million shares of our common stock. The remaining net proceeds were used for general corporate purposes. In the three months ended September 30, 2018, we recorded a loss on extinguishment of debt of $5.0 million in connection with these exchanges, which included an inducement charge of $1.1 million. At September 30, 2018, there were $16.2 million and $0.2 million aggregate principal amount remaining of our 5.375% Convertible Notes and 6.50% Convertible Notes, respectively. The initial conversion rates of the 5.375% Convertible Notes and 6.50% Convertible Notes were 107.7122 shares and 119.3033 shares, respectively, of common stock per $1,000 of principal, which represented a conversion price of $9.28 per share and $8.38 per share of common stock, respectively. At September 30, 2018, the 5.375% Convertible Notes and 6.50% Convertible Notes had conversion rates of 109.2211 shares and 123.2929 shares, respectively, of common stock per $1,000 of principal, which represented a conversion price of $9.16 per share and $8.11 per share of common stock, respectively. The 5.375% Convertible Notes and 6.50% Convertible Notes pay interest semiannually in arrears and have scheduled maturity dates in November 2020 and October 2019, respectively, unless earlier converted or repurchased by the holders pursuant to their terms. Our convertible senior unsecured notes are not redeemable by us prior to their maturities and are convertible into, at our election, cash, shares of our common stock or a combination of both, subject to the satisfaction of certain conditions and during specified periods. The conversion rates are subject to adjustment upon the occurrence of certain specified events and the holders may require us to repurchase all, or any portion, of their notes for cash equal to 100% of the principal amount, plus accrued and unpaid interest, if we undergo a fundamental change specified in the agreements. We intend to settle the principal balance of our convertible debt in cash and have not assumed share settlement of the principal balance for purposes of computing EPS. At the time of issuance, there is no precedent or policy that would indicate that we would settle the principal in shares or the conversion spread in cash. Accounting guidance requires that convertible debt instruments with cash settlement features, including partial cash settlement, account for the liability component and equity component (conversion feature) of the instrument separately. The initial value of the liability component reflects the present value of the discounted cash flows using the nonconvertible debt borrowing rate at the time of the issuance. The debt discount represents the difference between the proceeds received from the issuance and the initial carrying value of the liability component, which is accreted back to the notes principal amount through interest expense over the term of the notes, which was 2.72 years and 2.41 years at September 30, 2018 and December 31, 2017, respectively, on a weighted average basis. The UPB, unamortized discount and net carrying amount of the liability and equity components of our convertible notes were as follows (in thousands): Liability Equity Component Component Unamortized Debt Unamortized Deferred Net Carrying Net Carrying Period UPB Discount Financing Fees Value Value September 30, 2018 $ 280,816 $ 9,285 $ 7,878 $ 263,653 $ 9,436 December 31, 2017 $ 243,750 $ 5,742 $ 6,721 $ 231,287 $ 6,733 During the three months ended September 30, 2018, we incurred total aggregate interest expense on the notes of $5.0 million, of which $3.1 million, $1.0 million and $0.9 million related to the cash coupon, amortization of the deferred financing fees and of the debt discount, respectively. During the nine months ended September 30, 2018, we incurred total interest expense on the notes of $16.0 million, of which $9.9 million, $4.1 million and $2.0 million related to the cash coupon, amortization of the deferred financing fees and of the debt discount, respectively. During the three months ended September 30, 2017, we incurred total interest expense on the notes of $2.2 million, of which $1.6 million, $0.4 million and $0.2 million related to the cash coupon, amortization of the deferred financing fees and of the debt discount, respectively. During the nine months ended September 30, 2017, we incurred total interest expense on the notes of $6.6 million, of which $4.8 million, $1.1 million and $0.7 million related to the cash coupon, amortization of the deferred financing fees and of the debt discount, respectively. Including the amortization of the deferred financing fees and debt discount, our weighted average total cost of the notes is 7.45% per annum. Junior Subordinated Notes In the first quarter of 2017, we purchased, at a discount, $20.9 million of our junior subordinated notes with a carrying value of $19.8 million and recorded a gain on extinguishment of debt of $7.1 million. As a result, we settled our related equity investment and extinguished $21.5 million of notes. The carrying value of borrowings under our junior subordinated notes were $140.1 million and $139.6 million at September 30, 2018 and December 31, 2017, respectively, which is net of a deferred amount of $12.1 million and $12.5 million, respectively, (which is amortized into interest expense over the life of the notes) and deferred financing fees of $2.1 million and $2.2 million, respectively. These notes have maturities ranging from March 2034 through April 2037 and pay interest quarterly at a fixed or floating rate of interest based on LIBOR. The current weighted average note rate was 5.25% and 4.53% at September 30, 2018 and December 31, 2017, respectively. Including certain fees and costs, the weighted average note rate was 5.34% and 4.63% at September 30, 2018 and December 31, 2017, respectively. Related Party Financing In connection with the Acquisition, we entered into a five year $50.0 million preferred equity interest financing agreement with ACM to finance a portion of the aggregate purchase price. At December 31, 2017, the outstanding principal balance was $50.0 million. In January 2018, we paid $50.0 million in full satisfaction of this debt. During the nine months ended September 30, 2018, we recorded interest expense of $0.3 million and, during the three and nine months ended September 30, 2017, we recorded interest expense of $1.0 million and $2.9 million, respectively. Debt Covenants Credit Facilities and Repurchase Agreements. The credit facilities and repurchase agreements contain various financial covenants, including, but not limited to, minimum liquidity requirements, minimum net worth requirements, as well as certain other debt service coverage ratios, debt to equity ratios and minimum servicing portfolio tests. We were in compliance with all financial covenants and restrictions at September 30, 2018. CLOs. Our CLO vehicles contain interest coverage and asset overcollateralization covenants that must be met as of the waterfall distribution date for us to receive such payments. If we fail these covenants in any of our CLOs, all cash flows from the applicable CLO would be diverted to repay principal and interest on the outstanding CLO bonds and we would not receive any residual payments until that CLO regained compliance with such tests. Our CLOs were in compliance with all such covenants as of September 30, 2018, as well as on the most recent determination dates in October 2018. In the event of a breach of the CLO covenants that could not be cured in the near-term, we would be required to fund our non-CLO expenses, including employee costs, distributions required to maintain our REIT status, debt costs, and other expenses with (i) cash on hand, (ii) income from any CLO not in breach of a covenant test, (iii) income from real property and loan assets, (iv) sale of assets, or (v) accessing the equity or debt capital markets, if available. We have the right to cure covenant breaches which would resume normal residual payments to us by purchasing non-performing loans out of the CLOs. However, we may not have sufficient liquidity available to do so at such time. A summary of our CLO compliance tests as of the most recent determination dates in October 2018 is as follows: Cash Flow Triggers CLO VI CLO VII CLO VIII CLO IX CLO X Overcollateralization (1) Current 129.87 % 129.03 % 129.03 % 134.68 % 126.98 % Limit 128.87 % 128.03 % 128.03 % 133.68 % 125.98 % Pass / Fail Pass Pass Pass Pass Pass Interest Coverage (2) Current 208.68 % 212.40 % 268.75 % 276.05 % 236.32 % Limit 120.00 % 120.00 % 120.00 % 120.00 % 120.00 % Pass / Fail Pass Pass Pass Pass Pass (1) The overcollateralization ratio divides the total principal balance of all collateral in the CLO by the total principal balance of the bonds associated with the applicable ratio. To the extent an asset is considered a defaulted security, the asset’s principal balance for purposes of the overcollateralization test is the lesser of the asset’s market value or the principal balance of the defaulted asset multiplied by the asset’s recovery rate which is determined by the rating agencies. Rating downgrades of CLO collateral will generally not have a direct impact on the principal balance of a CLO asset for purposes of calculating the CLO overcollateralization test unless the rating downgrade is below a significantly low threshold (e.g. CCC-) as defined in each CLO vehicle. (2) The interest coverage ratio divides interest income by interest expense for the classes senior to those retained by us. Our CLO overcollateralization ratios as of the determination dates subsequent to each quarter are as follows: Determination (1) CLO VI CLO VII CLO VIII CLO IX CLO X October 2018 129.87 % 129.03 % 129.03 % 134.68 % 126.98 % July 2018 129.87 % 129.03 % 129.03 % 134.68 % 126.98 % April 2018 129.87 % 129.03 % 129.03 % 134.69 % — January 2018 129.87 % 129.03 % 129.03 % 134.68 % — October 2017 129.87 % 129.03 % 129.03 % — — (1) The table above represents the quarterly trend of our overcollateralization ratio, however, the CLO determination dates are monthly and we were in compliance with this test for all periods presented. The ratio fluctuates based on the performance of the underlying assets, transfers of assets into the CLOs prior to expiration of their respective replenishment dates, purchase or disposal of other investments, and loan payoffs. No payment due under the junior subordinated indentures may be paid if there is a default under any senior debt and the senior lender has sent notice to the trustee. The junior subordinated indentures are also cross-defaulted with each other. |
Allowance for Loss-Sharing Obli
Allowance for Loss-Sharing Obligations | 9 Months Ended |
Sep. 30, 2018 | |
Allowance for Loss-Sharing Obligations | |
Allowance for Loss-Sharing Obligations | Note 11 — Allowance for Loss-Sharing Obligations Our allowance for loss-sharing obligations related to the Fannie Mae DUS program is as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Beginning balance $ 31,402 $ 32,797 $ 30,511 $ 32,407 Provisions for loss sharing 2,924 1,265 5,263 5,410 Provisions reversal for loan repayments (905) (3,882) (2,423) (5,815) (Charge-offs) recoveries, net (16) (22) 54 (1,844) Ending balance $ 33,405 $ 30,158 $ 33,405 $ 30,158 When we settle a loss under the DUS loss-sharing model, the net loss is charged-off against the previously recorded loss-sharing obligation. The settled loss is often net of any previously advanced principal and interest payments in accordance with the DUS program, which are reflected as reductions to the proceeds needed to settle losses. At both September 30, 2018 and December 31, 2017, we had outstanding advances of $0.1 million, which were netted against the allowance for loss-sharing obligations. At September 30, 2018 and December 31, 2017, the maximum quantifiable liability associated with our guarantees under the Fannie Mae DUS agreement was $2.38 billion and $2.24 billion, respectively. The maximum quantifiable liability is not representative of the actual loss we would incur. We would be liable for this amount only if all of the loans we service for Fannie Mae, for which we retain some risk of loss, were to default and all of the collateral underlying these loans was determined to be without value at the time of settlement. |
Derivative Financial Instrument
Derivative Financial Instruments | 9 Months Ended |
Sep. 30, 2018 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | Note 12 — Derivative Financial Instruments The following is a summary of our non-qualifying derivative financial instruments held by our Agency Business ($ in thousands): September 30, 2018 Fair Value Notional Balance Sheet Derivative Derivative Derivative Count Value Location Assets Liabilities Rate Lock Commitments 6 $ 37,965 Other Assets/Other Liabilities $ 749 $ (28) Forward Sale Commitments 57 530,931 Other Assets/Other Liabilities 177 (3,378) $ 568,896 $ 926 $ (3,406) December 31, 2017 Rate Lock Commitments 3 $ 38,578 Other Assets/Other Liabilities $ 276 $ (278) Forward Sale Commitments 75 330,827 Other Assets/Other Liabilities 408 (1,028) $ 369,405 $ 684 $ (1,306) We enter into contractual commitments to originate and sell mortgage loans at fixed prices with fixed expiration dates. The commitments become effective when the borrower “rate locks” a specified interest rate within time frames established by us. All potential borrowers are evaluated for creditworthiness prior to the extension of the commitment. Market risk arises if interest rates move adversely between the time of the rate lock by the borrower and the sale date of the loan to an investor. To mitigate the effect of the interest rate risk inherent in providing rate lock commitments to borrowers, we enter into a forward sale commitment with the investor simultaneous with the rate lock commitment with the borrower. The forward sale contract locks in an interest rate and price for the sale of the loan. The terms of the contract with the investor and the rate lock with the borrower are matched in substantially all respects, with the objective of eliminating interest rate risk to the extent practical. Sale commitments with the investors have an expiration date that is longer than our related commitments to the borrower to allow, among other things, for the closing of the loan and processing of paperwork to deliver the loan into the sale commitment. These commitments meet the definition of a derivative and are recorded at fair value, including the effects of interest rate movements which are reflected as a component of other income, net in the consolidated statements of income. The estimated fair value of rate lock commitments also includes the fair value of the expected net cash flows associated with the servicing of the loan which is recorded as income from MSRs in the consolidated statements of income. During the three and nine months ended September 30, 2018, we recorded a net loss of $4.4 million and $2.3 million, respectively, from changes in the fair value of these derivatives in other income, net and $25.2 million and $62.8 million, respectively, of income from MSRs. During the three and nine months ended September 30, 2017, we recorded net gains of $0.2 million and net losses of $2.3 million, respectively, from changes in the fair value of these derivatives in other income, net and $18.9 million and $56.2 million, respectively, of income from MSRs. See Note 13 - Fair Value for details. |
Fair Value
Fair Value | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value | |
Fair Value | Note 13 — Fair Value Fair value estimates are dependent upon subjective assumptions and involve significant uncertainties resulting in variability in estimates with changes in assumptions. The following table summarizes the principal amounts, carrying values and the estimated fair values of our financial instruments (in thousands): September 30, 2018 December 31, 2017 Principal / Carrying Estimated Principal / Carrying Estimated Notional Amount Value Fair Value Notional Amount Value Fair Value Financial assets: Loans and investments, net $ 3,170,117 $ 3,097,689 $ 3,154,139 $ 2,652,538 $ 2,579,127 $ 2,652,520 Loans held-for-sale, net 492,966 500,281 507,698 292,249 297,443 302,883 Capitalized mortgage servicing rights, net n/a 259,401 312,316 n/a 252,608 286,073 Securities held-to-maturity, net 70,518 50,520 52,312 40,566 27,837 28,439 Derivative financial instruments 155,202 926 926 77,984 684 684 Financial liabilities: Credit and repurchase facilities $ 1,172,413 $ 1,169,586 $ 1,170,235 $ 530,938 $ 528,573 $ 529,992 Collateralized loan obligations 1,609,524 1,592,089 1,616,293 1,436,274 1,418,422 1,436,871 Debt fund 70,000 68,099 70,135 70,000 68,084 70,000 Senior unsecured notes 125,000 122,358 124,375 97,860 95,280 99,582 Convertible senior unsecured notes, net 280,816 263,653 289,560 243,750 231,287 254,335 Junior subordinated notes 154,336 140,084 95,458 154,336 139,590 94,215 Related party financing — — — 50,000 50,000 49,682 Derivative financial instruments 413,694 3,406 3,406 291,421 1,306 1,306 Assets and liabilities disclosed at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities are as follows: Level 1—Inputs are unadjusted and quoted prices exist in active markets for identical assets or liabilities, such as government, agency and equity securities. Level 2—Inputs (other than quoted prices included in Level 1) are observable for the asset or liability through correlation with market data. Level 2 inputs may include quoted market prices for a similar asset or liability, interest rates and credit risk. Examples include non-government securities, certain mortgage and asset-backed securities, certain corporate debt and certain derivative instruments. Level 3—Inputs reflect our best estimate of what market participants would use in pricing the asset or liability and are based on significant unobservable inputs that require a considerable amount of judgment and assumptions. Examples include certain mortgage and asset-backed securities, certain corporate debt and certain derivative instruments. Determining which category an asset or liability falls within the hierarchy requires significant judgment and we evaluate our hierarchy disclosures each quarter. The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy. Loans and investments, net. Fair values of loans and investments that are not impaired are estimated using Level 3 inputs based on direct capitalization rate and discounted cash flow methodologies using discount rates, which, in our opinion, best reflect current market interest rates that would be offered for loans with similar characteristics and credit quality. Fair values of impaired loans and investments are estimated using Level 3 inputs that require significant judgments, which include assumptions regarding discount rates, capitalization rates, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan and other factors. Loans held-for-sale, net. Consists of originated loans that are generally transferred or sold within 60 days of loan funding, and are valued using pricing models that incorporate observable inputs from current market assumptions or a hypothetical securitization model utilizing observable market data from recent securitization spreads and observable pricing of loans with similar characteristics (Level 2). Fair value includes the fair value allocated to the associated future MSRs and is calculated pursuant to the valuation techniques described below for capitalized mortgage servicing rights, net (Level 3). Capitalized mortgage servicing rights, net. Fair values are estimated using Level 3 inputs based on discounted future net cash flow methodology. The fair value of MSRs carried at amortized cost are estimated using a process that involves the use of independent third-party valuation experts, supported by commercially available discounted cash flow models and analysis of current market data. The key inputs used in estimating fair value include the contractually specified servicing fees, prepayment speed of the underlying loans, discount rate, annual per loan cost to service loans, delinquency rates, late charges and other economic factors. Securities held-to-maturity, net. Fair values are approximated using Level 3 inputs based on current market quotes received from financial sources that trade such securities and are based on prevailing market data and, in some cases, are derived from third party proprietary models based on well recognized financial principles and reasonable estimates about relevant future market conditions. Derivative financial instruments. The fair values of rate lock and forward sale commitments are estimated using valuation techniques, which include internally-developed models developed based on changes in the U.S. Treasury rate and other observable market data (Level 2). The fair value of rate lock commitments includes the fair value of the expected net cash flows associated with the servicing of the loans, see capitalized mortgage servicing rights, net above for details on the applicable valuation technique (Level 3). We also consider the impact of counterparty non-performance risk when measuring the fair value of these derivatives. Given the credit quality of our counterparties, the short duration of interest rate lock commitments and forward sale contracts, and our historical experience, the risk of nonperformance by our counterparties is not significant. Credit facilities and repurchase agreements. Fair values for credit facilities and repurchase agreements of the Structured Business are estimated at Level 3 using discounted cash flow methodology, using discount rates, which, in our opinion, best reflect current market interest rates for financing with similar characteristics and credit quality. The majority of our credit facilities and repurchase agreement for the Agency Business bear interest at rates that are similar to those available in the market currently and the fair values are estimated using Level 2 inputs. For these facilities, the fair values approximate their carrying values. Collateralized loan obligations, Debt Fund, junior subordinated notes and related party financing. Fair values are estimated at Level 3 based on broker quotations, representing the discounted expected future cash flows at a yield that reflects current market interest rates and credit spreads. Senior unsecured notes. Fair values are estimated at Level 1 when current market quotes received from active markets are available. If quotes from active markets are unavailable, then the fair values are estimated at Level 2 utilizing current market quotes received from inactive markets. Convertible senior unsecured notes, net. Fair values are estimated at Level 2 based on current market quotes received from inactive markets. We measure certain financial assets and financial liabilities at fair value on a recurring basis. The fair values of these financial assets and liabilities were determined using the following input levels as of September 30, 2018 (in thousands): Fair Value Measurements Using Fair Carrying Value Hierarchy Value Fair Value Level 1 Level 2 Level 3 Financial assets: Derivative financial instruments $ 926 $ 926 $ — $ 177 $ 749 Financial liabilities: Derivative financial instruments $ 3,406 $ 3,406 $ — $ 3,406 $ — We measure certain financial and non-financial assets at fair value on a nonrecurring basis. The fair values of these financial and non-financial assets were determined using the following input levels as of September 30, 2018 (in thousands): Fair Value Measurements Using Fair Net Carrying Value Hierarchy Value Fair Value Level 1 Level 2 Level 3 Financial assets: Impaired loans, net (1) $ 70,909 $ 70,909 $ — $ — $ 70,909 Non-financial assets: Long-lived assets (2) $ 14,563 $ 14,563 $ — $ — $ 14,563 (1) We had an allowance for loan losses of $61.0 million relating to five loans with an aggregate carrying value, before loan loss reserves, of $131.9 million at September 30, 2018. (2) We recorded a $2.0 million impairment loss during the nine months ended September 30, 2018 on the office building we own. See Note 9 - Real Estate Owned for details. Loan impairment assessments. Loans held for investment are intended to be held to maturity and, accordingly, are carried at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and net of the allowance for loan losses, when such loan or investment is deemed to be impaired. We consider a loan impaired when, based upon current information, it is probable that we will be unable to collect all amounts due for both principal and interest according to the contractual terms of the loan agreement. We evaluate our loans to determine if the value of the underlying collateral securing the impaired loan is less than the net carrying value of the loan, which may result in an allowance and corresponding charge to the provision for loan losses. These valuations require significant judgments, which include assumptions regarding capitalization and discount rates, revenue growth rates, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan and other factors. The table above and below includes all impaired loans, regardless of the period in which the impairment was recognized. Long-lived assets. We review our real estate owned assets when events or circumstances change, indicating that the carrying amount of an asset may not be partially or fully recoverable. In the evaluation of a real estate owned asset for impairment, many factors are considered, including broker quotes, estimated current and expected operating cash flows from the asset during the projected holding period, costs necessary to extend the life or improve the asset, expected capitalization rates, projected stabilized net operating income, selling costs, and the ability to hold and dispose of the asset in the ordinary course of business. We first compare the undiscounted cash flows to be generated by the asset and broker quotes, if any, to the carrying value of such asset. If the undiscounted cash flows and/or broker quotes are less than the carrying value, we recognize an impairment loss by comparing the carrying value of the asset to its fair value. Quantitative information about Level 3 fair value measurements at September 30, 2018 were as follows ($ in thousands): Valuation Fair Value Techniques Significant Unobservable Inputs Financial assets: Impaired loans: Land $ 70,135 Discounted cash flows Discount rate 15.00 % Capitalization rate 7.25 % Revenue growth rate 3.00 % Office 774 Discounted cash flows Discount rate 10.53 % Capitalization rate 8.53 % Revenue growth rate 2.63 % Derivative financial instruments: Rate lock commitments 749 Discounted cash flows W/A discount rate 10.15 % Non-financial assets: Long-lived assets: Office Building $ 3,210 Broker quotes N/A N/A The derivative financial instruments using Level 3 inputs are outstanding for short periods of time (generally less than 60 days). A roll-forward of Level 3 derivative instruments were as follows (in thousands): Fair Value Measurements Using Significant Unobservable Inputs Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Derivative assets and liabilities, net Balance at beginning of period $ 606 $ 1,420 $ 276 $ 2,816 Settlements (17,793) (18,897) (62,313) (57,578) Realized gains recorded in earnings 17,187 17,477 62,037 54,762 Unrealized gains recorded in earnings 749 420 749 420 Balance at end of period $ 749 $ 420 $ 749 $ 420 The components of fair value and other relevant information associated with our rate lock commitments, forward sales commitments and the estimated fair value of cash flows from servicing on loans held-for-sale were as follows (in thousands): Notional/ Fair Value of Interest Rate Total Fair Value September 30, 2018 Principal Amount Servicing Rights Movement Effect Adjustment Rate lock commitments $ 37,965 $ 749 $ (28) $ 721 Forward sale commitments 530,931 — 28 28 Loans held-for-sale, net (1) 492,966 8,459 — 8,459 Total $ 9,208 $ — $ 9,208 (1) Loans held-for-sale, net are recorded at the lower of cost or market on an aggregate basis and includes fair value adjustments related to estimated cash flows from MSRs. We measure certain assets and liabilities for which fair value is only disclosed. The fair value of these assets and liabilities was determined using the following input levels as of September 30, 2018 (in thousands): Fair Value Measurements Using Fair Value Hierarchy Carrying Value Fair Value Level 1 Level 2 Level 3 Financial assets: Loans and investments, net $ 3,097,689 $ 3,154,139 $ — $ — $ 3,154,139 Loans held-for-sale, net 500,281 507,698 — 499,239 8,459 Capitalized mortgage servicing rights, net 259,401 312,316 — — 312,316 Securities held-to-maturity, net 50,520 52,312 — — 52,312 Financial liabilities: Credit and repurchase facilities $ 1,169,586 $ 1,170,235 $ — $ 492,603 $ 677,632 Collateralized loan obligations 1,592,089 1,616,293 — — 1,616,293 Debt fund 68,099 70,135 — — 70,135 Senior unsecured notes 122,358 124,375 124,375 — — Convertible senior unsecured notes, net 263,653 289,560 — 289,560 — Junior subordinated notes 140,084 95,458 — — 95,458 |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2018 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 14 — Commitments and Contingencies Debt Obligations. Our debt obligations have maturities of $565.9 million for the remainder of 2018, $356.2 million in 2019, $972.0 billion in 2020, $872.3 million in 2021, $244.2 million in 2022 and $401.4 million thereafter. Agency Business Commitments. Our Agency Business is subject to supervision by certain regulatory agencies. Among other things, these agencies require us to meet certain minimum net worth, operational liquidity and restricted liquidity collateral requirements, and compliance with reporting requirements. Our adjusted net worth and liquidity required by the agencies for all periods presented exceeded these requirements. As of September 30, 2018, we were required to maintain at least $12.9 million of liquid assets in one of our subsidiaries to meet our operational liquidity requirements for Fannie Mae and we had operational liquidity in excess of this requirement. We are generally required to share the risk of any losses associated with loans sold under the Fannie Mae DUS program and are required to secure this obligation by assigning restricted cash balances and/or a letter of credit to Fannie Mae. The amount of collateral required by Fannie Mae is a formulaic calculation at the loan level by a Fannie Mae assigned tier which considers the loan balance, risk level of the loan, age of the loan and level of risk-sharing. Fannie Mae requires restricted liquidity for Tier 2 loans of 75 basis points, 15 basis points for Tier 3 loans and 5 basis points for Tier 4 loans, which is funded over a 48-month period that begins upon delivery of the loan to Fannie Mae. A significant portion of our Fannie Mae DUS serviced loans for which we have risk sharing are Tier 2 loans. As of September 30, 2018, we met the restricted liquidity requirement with a $44.0 million letter of credit. As of September 30, 2018, reserve requirements for the Fannie Mae DUS loan portfolio will require us to fund $29.7 million in additional restricted liquidity over the next 48 months, assuming no further principal paydowns, prepayments, or defaults within our at-risk portfolio. Fannie Mae periodically reassesses these collateral requirements and may make changes to these requirements in the future. We generate sufficient cash flow from our operations to meet these capital standards and do not expect any changes to have a material impact on our future operations; however, future changes to collateral requirements may adversely impact our available cash. We are subject to various capital requirements in connection with seller/servicer agreements that we have entered into with secondary market investors. Failure to maintain minimum capital requirements could result in our inability to originate and service loans for the respective investor and, therefore, could have a direct material effect on our consolidated financial statements. As of September 30, 2018, we met all of Fannie Mae’s quarterly capital requirements and our Fannie Mae adjusted net worth was in excess of the required net worth. We are not subject to capital requirements on a quarterly basis for Ginnie Mae or FHA, as such requirements for these investors are only required on an annual basis. As an approved designated seller/servicer under Freddie Mac's SBL program, we are required to post collateral to ensure that we are able to meet certain purchase and loss obligations required by this program. Under the SBL program, we are required to post collateral equal to $5.0 million, which is satisfied with a $5.0 million letter of credit. We enter into contractual commitments with borrowers providing rate lock commitments while simultaneously entering into forward sale commitments with investors. These commitments are outstanding for short periods of time (generally less than 60 days) and are described in Note 12-Derivative Financial Instruments and Note 13-Fair Value. Unfunded Commitments. In accordance with certain structured loans and investments, we have outstanding unfunded commitments of $68.6 million as of September 30, 2018 that we are obligated to fund as borrowers meet certain requirements. Specific requirements include, but are not limited to, property renovations, building construction and conversions based on criteria met by the borrower in accordance with the loan agreements. Litigation. We are currently neither subject to any material litigation nor, to the best of our knowledge, threatened by any material litigation other than the following: In June 2011, three related lawsuits were filed by the Extended Stay Litigation Trust (the “Trust”), a post-bankruptcy litigation trust alleged to have standing to pursue claims that previously had been held by Extended Stay, Inc. and the Homestead Village L.L.C. family of companies (together “ESI”) (formerly Chapter 11 debtors, together the "Debtors") that have emerged from bankruptcy. Two of the lawsuits were filed in the U.S. Bankruptcy Court for the Southern District of New York, and the third in the Supreme Court of the State of New York, New York County. There were 73 defendants in the three lawsuits, including 55 corporate and partnership entities and 18 individuals. A subsidiary of ours and certain other entities that are affiliates of ours are included as defendants. The New York State Court action has been removed to the Bankruptcy Court. Our affiliates filed a motion to dismiss the three lawsuits. The lawsuits all allege, as a factual basis and background certain facts surrounding the June 2007 leveraged buyout of ESI from affiliates of Blackstone Capital. Our subsidiary, Arbor ESH II, LLC, had a $115.0 million investment in the Series A1 Preferred Units of a holding company of Extended Stay, Inc. The New York State Court action and one of the two federal court actions name as defendants, Arbor ESH II, LLC, ACM and ABT-ESI LLC, an entity in which we have a membership interest, among the broad group of defendants. These two actions were commenced by substantially identical complaints. The defendants are alleged in these complaints, among other things, to have breached fiduciary and contractual duties by causing or allowing the Debtors to pay illegal dividends or other improper distributions of value at a time when the Debtors were insolvent. These two complaints also allege that the defendants aided and abetted, induced, or participated in breaches of fiduciary duty, waste, and unjust enrichment (“Fiduciary Duty Claims”) and name a director of ours, and a former general counsel of ACM, each of whom had served on the Board of Directors of ESI for a period of time. We are defending these two defendants and paying the costs of such defense. On the basis of the foregoing allegations, the Trust has asserted claims under a number of common law theories, seeking the return of assets transferred by the Debtors prior to the Debtors' bankruptcy filing. In the third action, filed in Bankruptcy Court, the same plaintiff, the Trust, has named ACM and ABT-ESI LLC, together with a number of other defendants and asserts claims, including constructive and fraudulent conveyance claims under state and federal statutes, as well as a claim under the Federal Debt Collection Procedure Act. In June 2013, the Trust filed a motion to amend the lawsuits, to, among other things, (i) consolidate the lawsuits into one lawsuit, (ii) remove 47 defendants, none of whom are related to us, from the lawsuits so that there are 26 remaining defendants, including 16 corporate and partnership entities and 10 individuals, and (iii) reduce the counts within the lawsuits from over 100 down to 17. The remaining counts in the amended complaint against our affiliates are principally state law claims for breach of fiduciary duties, waste, unlawful dividends and unjust enrichment, and claims under the Bankruptcy Code for avoidance and recovery actions, among others. The bankruptcy court granted the motion and the amended complaint has been filed. The amended complaint seeks approximately $139.0 million in the aggregate, plus interest from the date of the alleged unlawful transfers, from director designees, portions of which are also sought from our affiliates as well as from unaffiliated defendants. We have moved to dismiss the referenced actions and intend to vigorously defend against the claims asserted therein. During a status conference held in March 2014, the Court heard oral argument on the motion to dismiss and adjourned the case pending a ruling. Subsequent to that hearing, a new judge was assigned to the case and, in November 2016, the new judge entered an order directing the parties to file supplemental briefs addressing new cases decided since the last round of briefing. Oral arguments regarding the motion to dismiss were heard at a hearing held in January 2017. The Court reserved decision at that hearing. We have not made a loss accrual for this litigation because we believe that it is not probable that a loss has been incurred and an amount cannot be reasonably estimated. Litigation Settlement . In July 2018, we received net proceeds of $10.2 million from the settlement of a litigation related to a prior investment, which was recognized as a gain in the three months ended September 30, 2018. Due to Borrowers. Due to borrowers represents borrowers’ funds held by us to fund certain expenditures or to be released at our discretion upon the occurrence of certain pre-specified events, and to serve as additional collateral for borrowers’ loans. While retained, these balances earn interest in accordance with the specific loan terms they are associated with. |
Variable Interest Entities
Variable Interest Entities | 9 Months Ended |
Sep. 30, 2018 | |
Variable Interest Entities | |
Variable Interest Entities | Note 15 — Variable Interest Entities Our involvement with VIEs primarily affects our financial performance and cash flows through amounts recorded in interest income, interest expense, provision for loan losses and through activity associated with our derivative instruments. Consolidated VIEs. We have determined that our operating partnership, ARLP, and our CLO and Debt Fund entities, which we consolidate, are VIEs. ARLP is already consolidated in our financial statements, therefore, the identification of this entity as a VIE had no impact on our consolidated financial statements. Our CLO and Debt Fund consolidated entities invest in real estate and real estate-related securities and are financed by the issuance of debt securities. We, or one of our affiliates, are named collateral manager, servicer, and special servicer for all collateral assets held in CLOs, which we believe gives us the power to direct the most significant economic activities of those entities. We also have exposure to losses to the extent of our equity interests and also have rights to waterfall payments in excess of required payments to bond investors. As a result of consolidation, equity interests have been eliminated, and the consolidated balance sheets reflect both the assets held and debt issued by the CLOs and Debt Fund to third parties. Our operating results and cash flows include the gross amounts related to CLO and Debt Fund assets and liabilities as opposed to our net economic interests in those entities. The assets and liabilities related to these consolidated CLOs and Debt Fund are as follows (in thousands): September 30, 2018 December 31, 2017 Assets: Restricted cash $ 201,986 $ 138,736 Loans and investments, net 1,885,104 1,836,744 Due from related party 95,045 — Other assets 15,408 14,011 Total assets $ 2,197,543 $ 1,989,491 Liabilities: Collateralized loan obligations $ 1,592,089 $ 1,418,422 Debt fund 68,099 68,084 Other liabilities 3,013 2,046 Total liabilities $ 1,663,201 $ 1,488,552 Assets held by the CLOs and Debt Fund are restricted and can only be used to settle obligations of the CLOs and Debt Fund, respectively. The liabilities of the CLOs and Debt Fund are non-recourse to us and can only be satisfied from each respective asset pool. See Note 10—Debt Obligations for details. We are not obligated to provide, have not provided, and do not intend to provide financial support to any of the consolidated CLOs or Debt Fund. Unconsolidated VIEs. We determined that we are not the primary beneficiary of 23 VIEs in which we have a variable interest as of September 30, 2018 because we do not have the ability to direct the activities of the VIEs that most significantly impact each entity’s economic performance. The following is a summary of our variable interests in identified VIEs, of which we are not the primary beneficiary, as of September 30, 2018 (in thousands): Type Carrying Amount (1) Loans $ 287,166 B Piece bonds 50,520 Agency interest only strips 3,512 Total $ 341,198 (1) Represents the carrying amount of loans and investments before reserves. At September 30, 2018, $130.2 million of loans to VIEs had corresponding loan loss reserves of $59.3 million. See Note 3 - Loans and Investments for details. In addition, the maximum loss exposure as of September 30, 2018 would not exceed the carrying amount of our investment. These unconsolidated VIEs have exposure to real estate debt of approximately $3.01 billion at September 30, 2018. |
Equity
Equity | 9 Months Ended |
Sep. 30, 2018 | |
Equity | |
Equity | Note 16 — Equity Preferred Stock. The Series A and B preferred stock became redeemable by us in February 2018 and May 2018, respectively. The Series C preferred stock may not be redeemed by us before February 2019. Common Stock. In July 2018, we issued 6,820,196 shares in connection with the exchange of our 5.375% Convertible Notes and 6.50% Convertible Notes. See Note 10 - Debt Obligations for details. In May 2018, we completed a public offering in which we sold 5,500,000 shares of our common stock for $8.72 per share, and received net proceeds of $47.8 million after deducting the underwriter’s discount and other offering expenses. The proceeds were used to make investments and for general corporate purposes. We have an “At-The-Market” equity offering sales agreement with JMP Securities LLC (“JMP,”) which entitles us to issue and sell up to 7,500,000 shares of our common stock through JMP. Sales of the shares are made by means of ordinary brokers’ transactions or otherwise at market prices prevailing at the time of sale, or at negotiated prices. During the nine months ended September 30, 2018, we sold 952,700 shares for net proceeds of $8.1 million. As of September 30, 2018, we had approximately 6,500,000 shares available under this agreement. In June 2018, we filed, and the SEC declared effective, a new shelf registration statement for $500.0 million of debt securities, common stock, preferred stock, depositary shares and warrants. Noncontrolling Interest. Noncontrolling interest relates to the operating partnership units (“OP Units”) issued to satisfy a portion of the Acquisition purchase price. Upon the closing of the Acquisition in 2016, we issued 21,230,769 OP Units. The value of these OP Units at the Acquisition date was $154.8 million. Each of these OP Units are paired with one share of our special voting preferred shares having a par value of $0.01 per share and is entitled to one vote each on any matter submitted for stockholder approval. In August 2018, ACM distributed 577,185 OP Units and special voting preferred shares to two of its partners in consideration for their respective membership interests, which were redeemed by us for cash totaling $6.8 million. At September 30, 2018, there were 20,653,584 OP Units outstanding, which represents approximately 21.4% of the voting power of our outstanding stock. The OP Units are entitled to receive distributions if and when our Board of Directors authorizes and declares common stock distributions. The OP Units are also redeemable for cash, or at our option, for shares of our common stock on a one-for-one basis. Distributions. Dividends declared (on a per share basis) during the nine months ended September 30, 2018 were as follows: Common Stock Preferred Stock Dividend (1) Declaration Date Dividend Declaration Date Series A Series B Series C February 21, 2018 $ 0.21 February 2, 2018 $ 0.515625 $ 0.484375 $ 0.53125 May 2, 2018 $ 0.25 May 2, 2018 $ 0.515625 $ 0.484375 $ 0.53125 August 1, 2018 $ August 1, 2018 $ $ $ (1) The dividend declared on August 1, 2018 was for June 1, 2018 through August 31, 2018, the dividend declared on May 2, 2018 was for March 1, 2018 through May 31, 2018 and the dividend declared on February 2, 2018 was for December 1, 2017 through February 28, 2018. Common Stock - On October 31, 2018, the Board of Directors declared a cash dividend of $0.27 per share of common stock. The dividend is payable on November 30, 2018 to common stockholders of record as of the close of business on November 15, 2018. Preferred Stock - On October 31, 2018, the Board of Directors declared a cash dividend of $0.515625 per share of 8.25% Series A preferred stock; a cash dividend of $0.484375 per share of 7.75% Series B preferred stock; and a cash dividend of $0.53125 per share of 8.50% Series C preferred stock. These amounts reflect dividends from September 1, 2018 through November 30, 2018 and are payable on November 30, 2018 to preferred stockholders of record on November 15, 2018. Deferred Compensation . In August 2018, we issued our chief executive officer 294,985 shares of performance-based restricted stock under his 2017 annual incentive agreement as a result of the Company meeting its goals related to the integration of the Acquisition. The award had a grant date fair value of $3.4 million and we recorded $0.2 million to employee compensation and benefits in our consolidated statements of income. In March 2018, we issued 265,444 shares of restricted common stock under the 2017 Amended Omnibus Stock Incentive Plan (the “2017 Plan”) to certain employees of ours with a total grant date fair value of $2.3 million and recorded $0.8 million to employee compensation and benefits in our consolidated statements of income. One third of the shares vested as of the grant date, one third will vest in March 2019, and the remaining third will vest in March 2020. In March 2018, we also issued 58,620 shares of fully vested common stock to the independent members of the Board of Directors under the 2017 Plan and recorded $0.5 million to selling and administrative expense in our consolidated statements of income. During the first quarter of 2018, we issued 63,584 shares of restricted common stock to our chief executive officer under his 2017 annual incentive agreement with a grant date fair value of $0.6 million and recorded $0.1 million to employee compensation and benefits in our consolidated statements of income. One quarter of the shares vested as of the grant date and one quarter will vest on each of the first, second and third anniversaries of the grant date. Our chief executive officer was also granted up to 381,503 performance-based restricted stock units that vest at the end of a four-year performance period based on our achievement of certain total stockholder return objectives. The restricted stock units had a grant date fair value of $0.8 million and we recorded less than $0.1 million to employee compensation and benefits in our consolidated statements of income. Earnings Per Share (“EPS”). Basic EPS is calculated by dividing net income attributable to common stockholders by the weighted average number of shares of common stock outstanding during each period inclusive of unvested restricted stock with full dividend participation rights. Diluted EPS is calculated by dividing net income by the weighted average number of shares of common stock outstanding plus the additional dilutive effect of common stock equivalents during each period using the treasury stock method. Our common stock equivalents include the weighted average dilutive effect of performance-based restricted stock units granted to our chief executive officer, OP Units and convertible senior unsecured notes. The following tables reconcile the numerator and denominator of our basic and diluted EPS computations ($ in thousands, except share and per share data): Three Months Ended September 30, 2018 2017 Basic Diluted Basic Diluted Net income attributable to common stockholders (1) $ 27,737 $ 27,737 $ 16,421 $ 16,421 Net income attributable to noncontrolling interest (2) — 7,799 — 5,662 Net income attributable to common stockholders and noncontrolling interest $ 27,737 $ 35,536 $ 16,421 $ 22,083 Weighted average shares outstanding 74,802,582 74,802,582 61,582,796 61,582,796 Dilutive effect of OP Units (2) — 21,023,735 — 21,230,769 Dilutive effect of restricted stock units (3) — 1,559,217 — 1,104,552 Dilutive effect of convertible notes (4) — 1,050,430 — — Weighted average shares outstanding Net income per common share (1) $ 0.37 $ 0.36 $ 0.27 $ 0.26 Nine Months Ended September 30, 2018 2017 Net income attributable to common stockholders (1) $ 71,093 $ 71,093 $ 43,964 $ 43,964 Net income attributable to noncontrolling interest (2) — 22,347 — 16,597 Net income attributable to common stockholders and noncontrolling interest $ 71,093 $ 93,440 $ 43,964 $ 60,561 Weighted average shares outstanding 67,490,132 67,490,132 56,602,504 56,602,504 Dilutive effect of OP Units (2) — 21,160,999 — 21,230,769 Dilutive effect of restricted stock units (3) — 1,441,264 — 1,077,178 Dilutive effect of convertible notes (4) — 1,041,212 — 32,468 Weighted average shares outstanding 67,490,132 91,133,607 56,602,504 78,942,919 Net income per common share (1) $ 1.05 $ 1.03 $ 0.78 $ 0.77 (1) Net of preferred stock dividends. (2) We consider OP Units to be common stock equivalents as the holders have voting rights, the right to distributions and the right to redeem the OP Units for the cash value of a corresponding number of shares of common stock or a corresponding number of shares of common stock, at our election. (3) Mr. Kaufman is granted restricted stock units annually, which vest at the end of a four-year performance period based upon our achievement of total stockholder return objectives. (4) The convertible senior unsecured notes impact diluted earnings per share if the average price of our common stock exceeds the conversion price, as calculated in accordance with the terms of the indenture. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2018 | |
Income Taxes | |
Income Taxes | Note 17 — Income Taxes As a REIT, we are generally not subject to U.S. federal income tax to the extent of our distributions to stockholders and as long as certain asset, income, distribution, ownership and administrative tests are met. To maintain our qualification as a REIT, we must annually distribute at least 90% of our REIT taxable income to our stockholders and meet certain other requirements. We may also be subject to certain state, local and franchise taxes. Under certain circumstances, federal income and excise taxes may be due on our undistributed taxable income. If we were to fail to meet these requirements, we would be subject to U.S. federal income tax, which could have a material adverse impact on our results of operations and amounts available for distributions to our stockholders. We believe that all of the criteria to maintain our REIT qualification have been met for the applicable periods, but there can be no assurance that these criteria will continue to be met in subsequent periods. The Agency Business is operated through our TRS Consolidated Group and is subject to U.S. federal, state and local income taxes. In general, our TRS entities may hold assets that the REIT cannot hold directly and may engage in real estate or non-real estate-related business. The Tax Cuts and Jobs Act (“Tax Reform”) was signed into law on December 22, 2017. Among numerous provisions included in the new tax law was the reduction of the corporate federal income tax rate from 35% to 21%. Our provision for income taxes in the nine months ended September 30, 2018 reflects the newly enacted corporate federal income tax rate of 21%. The final impact of the Tax Reform may differ due to, and among other things, changes in interpretations, assumptions made by us, the issuance of additional guidance and actions we may take as a result of the Tax Reform. In the three and nine months ended September 30, 2018, we recorded a tax provision of $5.4 million and $1.1 million, respectively. In the three and nine months ended September 30, 2017, we recorded a tax provision of $6.7 million and $16.2 million, respectively. The provision for income taxes recorded in the three months ended September 30, 2018 consisted of a current tax provision of $6.7 million and a deferred tax benefit of $1.3 million. The tax provision recorded in the nine months ended September 30, 2018 consisted of a current tax provision of $15.6 million and a deferred tax benefit of $14.5 million. The deferred tax benefit recorded in the nine months ended September 30, 2018 was due primarily to our payoff in January 2018 of the $50.0 million preferred equity interest entered into with ACM to finance a portion of the Acquisition purchase price. When we entered into the Acquisition, we established a deferred tax liability in connection with the $50.0 million preferred equity interest. Upon payoff in January 2018, the deferred tax liability was written off. See Note 10 - Debt Obligations for details. The provision for income taxes recorded in the three months ended September 30, 2017 consisted of a current tax provision of $7.6 million and a deferred tax benefit of $0.9 million. The provision for income taxes recorded in the nine months ended September 30, 2017 consisted of a current tax provision of $16.2 million. Current and deferred taxes are primarily recorded on the portion of earnings (losses) recognized by us with respect to our interest in the TRS’s. Deferred income tax assets and liabilities are calculated based on temporary differences between our U.S. GAAP consolidated financial statements and the federal, state, local tax basis of assets and liabilities as of the consolidated balance sheets. |
Agreements and Transactions wit
Agreements and Transactions with Related Parties | 9 Months Ended |
Sep. 30, 2018 | |
Agreements and Transactions with Related Parties | |
Agreements and Transactions with Related Parties | Note 18 — Agreements and Transactions with Related Parties Management Agreement . Prior to May 31, 2017, we had a management agreement with ACM, pursuant to which ACM provided us with a variety of professional and advisory services vital to our operations, including underwriting, accounting and treasury, compliance, marketing, information technology and human resources. Pursuant to the terms of the management agreement, we reimbursed ACM for its actual costs incurred in connection with managing our business through a base management fee, and, under certain circumstances, an annual incentive fee. In May 2017, we terminated the existing management agreement. We incurred base management fees of $6.7 million in the nine months ended September 30, 2017. We have a shared services agreement with ACM where we provide limited support services to ACM and they reimburse us for the costs of performing such services. During the three and nine months ended September 30, 2018, we incurred $0.3 million and $0.9 million, respectively, and, during the three and nine months ended September 30, 2017, we incurred $0.3 million and $0.4 million, respectively, of costs for services provided to ACM, which are included in due from related party on the consolidated balance sheets. Other Related Party Transactions. Due from related party was $97.5 million and $0.7 million at September 30, 2018 and December 31, 2017, respectively. The increase was primarily due to payoffs to be remitted by our affiliated servicing operations related to real estate transactions. Due to related party was $0.5 million at September 30, 2018 and consisted of loan payoffs, holdbacks and escrows to be remitted to our affiliated servicing operations related to real estate transactions. In August 2018, we originated a $17.7 million bridge loan to an entity owned, in part, by an immediate family member of our chief executive officer, who owns a 10.8% interest in the borrowing entity. The loan was used to purchase several undeveloped parcels of land. The loan has a fixed interest rate of 10% and matures in May 2019. Interest income recorded from this loan totaled $0.3 million for both the three and nine months ended September 30, 2018. In June 2018, we originated a $21.7 million bridge loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 75% in the borrowing entity. The loan has an interest rate of LIBOR plus 4.75%, with a LIBOR floor of 1.25%, and matures in June 2021. Interest income recorded from this loan totaled $0.3 million and $0.4 million for the three and nine months ended September 30, 2018, respectively. In April 2018, we acquired a $9.4 million bridge loan which was originated by ACM. The loan was used to purchase several multifamily properties by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 75% of the borrowing entity. The loan has an interest rate of LIBOR plus 5.0% with a LIBOR floor of 1.25% and matures in January 2021. Interest income recorded from this loan totaled $0.1 million and $0.2 million for the three and nine months ended September 30, 2018, respectively. In January 2018, we paid $50.0 million in full satisfaction of the related party financing we entered into with ACM to finance a portion of the Acquisition purchase price. We incurred interest expense related to this financing of $0.3 million for the nine months ended September 30, 2018 and $1.0 million and $2.9 million for the three and nine months ended September 30, 2017, respectively. In December 2017, we acquired a $32.8 million bridge loan which was originated by ACM. The loan was used to purchase several multifamily properties by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 90% of the borrowing entity. The loan has an interest rate of LIBOR plus 5.0%, with a LIBOR floor of 1.13%, and matures in June 2020. Interest income recorded from this loan totaled $0.6 million and $1.7 million for the three and nine months ended September 30, 2018, respectively. In the fourth quarter of 2017, we originated two bridge loans totaling $28.0 million on two multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns 45% of the borrowing entity. The loans have an interest rate of LIBOR plus 5.25% with LIBOR floors ranging from 1.24% to 1.54% and mature in the fourth quarter of 2020. Interest income recorded from these loans totaled $0.5 million and $1.6 million for the three and nine months ended September 30, 2018, respectively. In July 2017, we originated a $36.0 million bridge loan on a multifamily property owned in part by a consortium of investors. The consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) own a 95% interest in the borrowing entity. The loan had an interest rate of LIBOR plus 4.5% with a LIBOR floor of 1% and was scheduled to mature in July 2020. This loan was repaid in full in August 2018. Interest income recorded from this loan totaled $0.7 million and $1.9 million for the three and nine months ended September 30, 2018, respectively, and $0.4 million for both the three and nine months ended September 30, 2017. In May 2017, we originated a $46.9 million Fannie Mae loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers) which owns a 21.4% interest in the borrowing entity. We carry a maximum loss-sharing obligation with Fannie Mae on this loan of up to 5% of the original UPB. Servicing revenue recorded from this loan was less than $0.1 million and $0.1 million for the three and nine months ended September 30, 2018, respectively, and less than $0.1 million for both the three and nine months ended September 30, 2017. In March 2017, a consortium of investors (which includes, among other unaffiliated investors, our chief executive officer and ACM) invested $2.0 million for a 26.1% ownership interest in two portfolios of multifamily properties which has two bridge loans totaling $14.8 million originated by us in 2016. The loans had an interest rate of LIBOR plus 5.25% with a LIBOR floor of 0.5% and were scheduled to mature in November 2018. One of the loans was repaid in full in the fourth quarter of 2017 and the remaining loan paid off in June 2018. Interest income recorded from these loans totaled $0.3 million for the nine months ended September 30, 2018 and $0.3 million and $0.8 million for the three and nine months ended September 30, 2017, respectively. In January 2017, we modified a $5.0 million preferred equity investment, subsequently increasing our balance to $15.0 million, with a commitment to fund an additional $5.0 million. This investment had a fixed interest rate of 11% that was scheduled to mature in January 2020, however, the principal was repaid in full in the fourth quarter of 2017. We also entered into an agreement with a consortium of investors (which include, among other unaffiliated investors, certain of our officers and our chief executive officer) which admitted them as a member to fund the remaining $5.0 million preferred equity investment, which was generally subordinate to our investment. Interest income recorded from our investment totaled $0.2 million and $0.5 million in the three and nine months ended September 30, 2017, respectively. In January 2017, Ginkgo Investment Company LLC (“Ginkgo”), of which one of our directors is a 33% managing member, purchased a multifamily apartment complex which assumed an existing $8.3 million Fannie Mae loan that we service. Ginkgo subsequently sold the majority of its interest in this property and owned a 3.6% interest at September 30, 2018. We carry a maximum loss-sharing obligation with Fannie Mae on this loan of up to 20% of the original UPB. Upon the sale, we received a 1% loan assumption fee which was governed by existing loan agreements that were in place when the loan was originated in 2015, prior to such purchase. Servicing revenue recorded from this loan was less than $0.1 million for all periods presented. In 2016, we originated $48.0 million of bridge loans on six multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns interests ranging from 10.5% to 12.0% in the borrowing entities. The loans have an interest rate of LIBOR plus 4.5% with a LIBOR floor of 0.25% and mature in September 2019. In August 2017, a $6.8 million loan on one property paid off in full and in May 2018 three additional loans totaling $23.2 million paid off in full. Interest income recorded from these loans totaled $0.3 million and $1.6 million for the three and nine months ended September 30, 2018, respectively, and $0.7 million and $2.1 million for the three and nine months ended September 30, 2017, respectively. In 2016, we originated a $12.7 million bridge loan and a $5.2 million preferred equity investment on two multifamily properties owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns a 50% interest in the borrowing entity. The loan has an interest rate of LIBOR plus 4.5% with a LIBOR floor of 0.25% and matures in January 2019. The preferred equity investment has a fixed interest rate of 10% and a maturity extended to November 2018. Interest income recorded from these loans totaled $0.4 million and $1.0 million for the three and nine months ended September 30, 2018, respectively, and $0.3 million and $0.9 million for the three and nine months ended September 30, 2017, respectively. In 2016, we originated a $19.0 million bridge loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns a 7.5% interest in the borrowing entity. The loan had an interest rate of LIBOR plus 4.5% with a LIBOR floor of 0.25% and was scheduled to mature in January 2019. In January 2018, this loan paid off in full. Interest income recorded from this loan totaled $0.3 million for the nine months ended September 30, 2018 and $0.3 million and $0.8 million for the three and nine months ended September 30, 2017, respectively. In 2015, we originated a $7.1 million bridge loan on a multifamily property owned in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers and our chief executive officer) which owns a 7.5% interest in the borrowing entity. In August 2017, this loan paid off in full. The loan had an interest rate of LIBOR plus 4.5%, with a LIBOR floor of 0.25%. Interest income recorded from this loan totaled $0.1 million and $0.3 million for the three and nine months ended September 30, 2017, respectively. In 2015, we originated two bridge loans totaling $16.7 million secured by multifamily properties acquired by a third party investor. The properties were owned and were sold in part by a consortium of investors (which includes, among other unaffiliated investors, certain of our officers, our chief executive officer and certain other related parties). The loans have an interest rate of LIBOR plus 5% with a LIBOR floor of 0.25% and were scheduled to mature in October 2018. One of the loans paid off in full in September 2018 and the remaining loan was extended to November 2018. Interest income recorded from these loans totaled $0.3 million and $1.0 million for the three and nine months ended September 30, 2018, respectively, and $0.3 million and $0.8 million for the three and nine months ended September 30, 2017, respectively. In 2015, we originated a $3.0 million mezzanine loan on a multifamily property that had a $47.0 million first mortgage initially originated by ACM. The loan bore interest at a fixed rate of 12.5% and was scheduled to mature in April 2025. In January 2018, this loan paid off in full. Interest income recorded from this loan totaled $0.1 million for the nine months ended September 30, 2018 and $0.1 million and $0.3 million for the three and nine months ended September 30, 2017, respectively. In 2015, we invested $9.6 million for 50% of ACM's indirect interest in a joint venture with a third party that was formed to invest in a residential mortgage banking business. As a result of this transaction, we had an initial indirect interest of 22.5% in this entity. Since the initial investment, we invested an additional $16.1 million through this joint venture in non-qualified residential mortgages purchased from the mortgage banking business’s origination platform and we received cash distributions totaling $16.9 million (that were classified as returns of capital) as a result of the joint venture selling most of its mortgage assets (which $0.7 million was received in the nine months ended September 30, 2018). We recorded income from these investments of $0.4 million and $1.2 million in the three and nine months ended September 30, 2018, respectively, and a loss of $1.2 million and $1.8 million in the three and nine months ended September 30, 2017, respectively . In connection with a litigation settlement related to this investment, we provided a guaranty of up to 50% of any amounts payable in connection with the settlement. ACM has also provided us with a guaranty to pay up to 50% of any amounts we may pay under this guaranty. As of September 30, 2018, our maximum exposure under this guaranty totals $2.3 million. We have not accrued this amount as we do not believe that we will be required to make any nonrefundable payments under this guaranty. See Note 8-Investments in Equity Affiliates for details. In 2014, we invested $0.1 million for a 5% interest in a joint venture that owns two multifamily properties. The joint venture is comprised of a consortium of investors (which includes, among other unaffiliated investors, certain of our officers, our chief executive officer and certain other related parties) which owns a 95% interest. We had a $1.7 million bridge loan to the joint venture with an interest rate of 5.5% over LIBOR. The loan was repaid in full in the fourth quarter of 2017. Interest income recorded from this loan was less than $0.1 million and $0.1 million for the three and nine months ended September 30, 2017, respectively. In 2014, we originated a $30.4 million bridge loan for an office property owned in part by a consortium of investors (which includes, among other unaffiliated investors, our chief executive officer and his affiliates) which owns a 24% interest in the borrowing entity. The loan matured in August 2017 and was refinanced with a $43.2 million bridge loan that has an interest rate of 4% over LIBOR with a LIBOR floor of 1.23% and matures in August 2020. We also originated a $4.6 million mezzanine loan in 2016 to this entity that had a fixed interest rate of 12%, which was repaid in full at maturity in August 2017. In the fourth quarter of 2017, the consortium of investors sold their ownership interest in the borrowing entity. Interest income recorded from these loans totaled $0.8 million and $2.4 million for the three and nine months ended September 30, 2017, respectively. In 2014, ACM purchased a property subject to two loans originated by us, a first mortgage of $14.6 million and a second mortgage of $5.1 million, both with maturity dates of April 2016 and an interest rate of 4.8% over LIBOR. In 2016, the $5.1 million second mortgage was repaid in full and the $14.6 million first mortgage was extended to April 2018 and paid off at maturity. Interest income recorded from these loans totaled $0.2 million for the nine months ended September 30, 2018 and $0.2 million and $0.7 million for the three and nine months ended September 30, 2017, respectively. We, along with an executive officer of ours and a consortium of independent outside investors, hold equity investments in a portfolio of multifamily properties referred to as the Lexford Portfolio (“Lexford”), which is managed by an entity owned primarily by a consortium of affiliated investors, including our chief executive officer and an executive officer of ours. Based on the terms of the management contract, the management company is entitled to 4.75% of gross revenues of the underlying properties, along with the potential to share in the proceeds of a sale or restructuring of the debt. In June 2018, the owners of Lexford restructured part of its debt and we originated twelve bridge loans totaling $280.5 million, which were used to repay in full certain existing mortgage debt and to renovate 72 multifamily properties included in the portfolio. The loans which we originated in June 2018 have interest rates of 400 basis points over LIBOR and mature in June 2021 (with 2 one-year extension options). Interest income recorded from these loans totaled $4.4 million and $5.5 million in the three and nine months ended September 30, 2018, respectively. Further, as part of this June 2018 restructuring, $50.0 million in unsecured financing was provided by an unsecured lender to certain parent entities of the property owners. ACM owns slightly less than half of the unsecured lender entity and, therefore, provided slightly less than half of the unsecured lender financing. In addition, in connection with our equity investment, we received distributions totaling $0.7 million during both the three months ended September 30, 2018 and 2017 and $1.9 million and $2.0 million during the nine months ended September 30, 2018 and 2017, respectively, which were recorded as (loss) income from equity affiliates. Separate from loans which we originated in June 2018, we provide limited ("bad boy") guarantees for certain other debt controlled by Lexford. The bad boy guarantees may become a liability for us upon standard "bad" acts such as fraud or a material misrepresentation by Lexford or us. At September 30, 2018, this debt had an aggregate outstanding balance of $307.9 million and is scheduled to mature between 2019 and 2025. Several of our executives, including our chief financial officer, general counsel and our chairman, chief executive officer and president, hold similar positions for ACM. Our chief executive officer and his affiliated entities (“the Kaufman Entities”) together beneficially own approximately 75% of the outstanding membership interests of ACM and certain of our employees and directors also hold an ownership interest in ACM. Furthermore, one of our directors serves as the trustee and co-trustee of two of the Kaufman Entities that hold membership interests in ACM. Upon the closing of the Acquisition in 2016, we issued 21,230,769 OP Units, each paired with one share of our Special Voting Preferred Shares. In December 2017 and August 2018, ACM distributed 5,780,348 and 577,185 OP Units, respectively, to its members, which include the Kaufman Entities and certain of our officers and employees. At September 30, 2018, ACM holds 5,349,053 shares of our common stock and 14,873,236 OP Units, which represents 21.0% of the voting power of our outstanding stock. Our Board of Directors approved a resolution under our charter allowing our chief executive officer and ACM, (which our chief executive officer has a controlling equity interest in), to own more than the 5% ownership interest limit of our common stock as stated in our amended charter. |
Segment Information
Segment Information | 9 Months Ended |
Sep. 30, 2018 | |
Segment Information | |
Segment Information | Note 19 — Segment Information The summarized statements of income and balance sheet data, as well as certain other data, by segment are included in the following tables ($ in thousands). Specifically identifiable costs are recorded directly to each business segment. For items not specifically identifiable, costs have been allocated between the business segments using the most meaningful allocation methodologies, which was predominately direct labor costs (i.e., time spent working on each business segment). Such costs include, but are not limited to, compensation and employee related costs, selling and administrative expenses, management fees (through May 31, 2017 - effective date of the full internalization of our management team and termination of the existing management agreement with ACM) and stock-based compensation. Three Months Ended September 30, 2018 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 61,232 $ 6,268 $ — $ 67,500 Interest expense 35,508 4,040 — 39,548 Net interest income 25,724 2,228 — 27,952 Other revenue: Gain on sales, including fee-based services, net — 17,451 — 17,451 Mortgage servicing rights — 25,216 — 25,216 Servicing revenue — 26,082 — 26,082 Amortization of MSRs — (11,838) — (11,838) Property operating income 2,651 — — 2,651 Other income, net 406 (4,388) — (3,982) Total other revenue 3,057 52,523 — 55,580 Other expenses: Employee compensation and benefits 6,683 21,092 — 27,775 Selling and administrative 4,465 5,529 — 9,994 Property operating expenses 2,437 — — 2,437 Depreciation and amortization 447 1,401 — 1,848 Provision for loss sharing (net of recoveries) — 2,019 — 2,019 Provision for loan losses (net of recoveries) 836 — — 836 Litigation settlement gain (10,170) — — (10,170) Total other expenses 4,698 30,041 — 34,739 Income before extinguishment of debt, loss from equity affiliates and income taxes 24,083 24,710 — 48,793 Loss on extinguishment of debt (4,960) — — (4,960) Loss from equity affiliates (1,028) — — (1,028) Provision for income taxes — (5,381) — (5,381) Net income 18,095 19,329 — 37,424 Preferred stock dividends 1,888 — — 1,888 Net income attributable to noncontrolling interest — — 7,799 7,799 Net income attributable to common stockholders $ 16,207 $ 19,329 $ (7,799) $ 27,737 Three Months Ended September 30, 2017 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 37,259 $ 4,881 $ — $ 42,140 Interest expense 19,913 2,975 962 23,850 Net interest income 17,346 1,906 (962) 18,290 Other revenue: Gain on sales, including fee-based services, net — 17,126 — 17,126 Mortgage servicing rights — 18,897 — 18,897 Servicing revenue — 20,231 — 20,231 Amortization of MSRs — (11,711) — (11,711) Property operating income 2,668 — — 2,668 Other income, net 540 238 — 778 Total other revenue 3,208 44,781 — 47,989 Other expenses: Employee compensation and benefits 5,670 19,524 — 25,194 Selling and administrative 3,014 4,593 — 7,607 Property operating expenses 2,583 — — 2,583 Depreciation and amortization 429 1,400 — 1,829 Provision for loss sharing (net of recoveries) — (2,617) — (2,617) Provision for loan losses (net of recoveries) 2,000 — — 2,000 Total other expenses 13,696 22,900 — 36,596 Income before income from equity affiliates and income taxes 6,858 23,787 (962) 29,683 Income from equity affiliates 996 — — 996 Provision for income taxes — (6,708) — (6,708) Net income 7,854 17,079 (962) 23,971 Preferred stock dividends 1,888 — — 1,888 Net income attributable to noncontrolling interest — — 5,662 5,662 Net income attributable to common stockholders $ 5,966 $ 17,079 $ (6,624) $ 16,421 Nine Months Ended September 30, 2018 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 162,645 $ 15,763 $ — $ 178,408 Interest expense 100,324 10,166 329 110,819 Net interest income 62,321 5,597 (329) 67,589 Other revenue: Gain on sales, including fee-based services, net — 51,266 — 51,266 Mortgage servicing rights — 62,787 — 62,787 Servicing revenue — 70,301 — 70,301 Amortization of MSRs — (35,639) — (35,639) Property operating income 8,525 — — 8,525 Other income, net 757 (2,331) — (1,574) Total other revenue 9,282 146,384 — 155,666 Other expenses: Employee compensation and benefits 21,019 63,065 — 84,084 Selling and administrative 11,500 16,283 — 27,783 Property operating expenses 8,089 — — 8,089 Depreciation and amortization 1,338 4,201 — 5,539 Impairment loss on real estate owned 2,000 — — 2,000 Provision for loss sharing (net of recoveries) — 2,840 — 2,840 Provision for loan losses (net of recoveries) (967) — — (967) Litigation settlement gain (10,170) — — (10,170) Total other expenses 32,809 86,389 — 119,198 Income before extinguishment of debt, income from equity affiliates and income taxes 38,794 65,592 (329) 104,057 Loss on extinguishment of debt (4,960) — — (4,960) Income from equity affiliates 1,104 — — 1,104 Benefit from (provision for) income taxes 500 (1,596) — (1,096) Net income 35,438 63,996 (329) 99,105 Preferred stock dividends 5,665 — — 5,665 Net income attributable to noncontrolling interest — — 22,347 22,347 Net income attributable to common stockholders $ 29,773 $ 63,996 $ (22,676) $ 71,093 Nine Months Ended September 30, 2017 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 95,685 $ 14,448 $ — $ 110,133 Interest expense 51,866 8,946 2,886 63,698 Net interest income 43,819 5,502 (2,886) 46,435 Other revenue: Gain on sales, including fee-based services, net — 55,127 — 55,127 Mortgage servicing rights — 56,182 — 56,182 Servicing revenue — 55,350 — 55,350 Amortization of MSRs — (35,427) — (35,427) Property operating income 8,755 — — 8,755 Other income, net 1,381 (2,312) — (931) Total other revenue 10,136 128,920 — 139,056 Other expenses: Employee compensation and benefits 13,570 53,291 — 66,861 Selling and administrative 8,993 14,143 — 23,136 Property operating expenses 7,843 — — 7,843 Depreciation and amortization 1,341 4,201 — 5,542 Impairment loss on real estate owned 2,700 — — 2,700 Provision for loss sharing (net of recoveries) — (405) — (405) Provision for loan losses (net of recoveries) (457) — — (457) Management fee - related party 3,259 3,414 — 6,673 Total other expenses 37,249 74,644 — 111,893 Income before extinguishment of debt, income from equity affiliates and income taxes 16,706 59,778 (2,886) 73,598 Gain on extinguishment of debt 7,116 — — 7,116 Income from equity affiliates 1,756 — — 1,756 Provision for income taxes — (16,244) — (16,244) Net income 25,578 43,534 (2,886) 66,226 Preferred stock dividends 5,665 — — 5,665 Net income attributable to noncontrolling interest — — 16,597 16,597 Net income attributable to common stockholders $ 19,913 $ 43,534 $ (19,483) $ 43,964 (1) Includes certain corporate expenses not allocated to the two reportable segments, such as financing costs associated with the Acquisition, as well as income allocated to the noncontrolling interest holders. September 30, 2018 Structured Business Agency Business Other / Eliminations Consolidated Assets: Cash and cash equivalents $ 45,001 $ 47,597 $ — $ 92,598 Restricted cash 202,736 — — 202,736 Loans and investments, net 3,097,689 — — 3,097,689 Loans held-for-sale, net — 500,281 — 500,281 Capitalized mortgage servicing rights, net — 259,401 — 259,401 Securities held to maturity — 50,520 — 50,520 Investments in equity affiliates 22,101 — — 22,101 Goodwill and other intangible assets 12,500 105,065 — 117,565 Other assets 172,078 19,291 — 191,369 Total assets $ 3,552,105 $ 982,155 $ — $ 4,534,260 Liabilities: Debt obligations $ 2,863,266 $ 492,603 $ — $ 3,355,869 Allowance for loss-sharing obligations — 33,405 — 33,405 Other liabilities 140,662 37,852 — 178,514 Total liabilities $ 3,003,928 $ 563,860 $ — $ 3,567,788 December 31, 2017 Structured Business Agency Business Other / Eliminations Consolidated Assets: Cash and cash equivalents $ 37,056 $ 67,318 $ — $ 104,374 Restricted cash 139,398 — — 139,398 Loans and investments, net 2,579,127 — — 2,579,127 Loans held-for-sale, net — 297,443 — 297,443 Capitalized mortgage servicing rights, net — 252,608 — 252,608 Securities held-to-maturity, net — 27,837 — 27,837 Investments in equity affiliates 23,653 — — 23,653 Goodwill and other intangible assets 12,500 109,266 — 121,766 Other assets 66,227 13,512 — 79,739 Total assets $ 2,857,961 $ 767,984 $ — $ 3,625,945 Liabilities: Debt obligations $ 2,189,700 $ 291,536 $ 50,000 $ 2,531,236 Allowance for loss-sharing obligations — 30,511 — 30,511 Other liabilities 155,814 42,819 1,009 199,642 Total liabilities $ 2,345,514 $ 364,866 $ 51,009 $ 2,761,389 Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Origination Data: Structured Business New loan originations $ 287,480 $ 473,171 $ 1,208,550 $ 1,057,004 Loan payoffs / paydowns 255,575 270,010 684,216 723,977 Agency Business Origination Volumes by Investor: Fannie Mae $ 995,662 $ 650,374 $ 2,264,870 $ 2,216,820 Freddie Mac 317,516 328,075 1,060,456 880,597 FHA 77,236 18,273 137,973 189,087 CMBS/Conduit 20,650 — 36,883 21,370 Total $ 1,411,064 $ 996,722 $ 3,500,182 $ 3,307,874 Total loan commitment volume $ 1,376,376 $ 928,181 $ 3,499,569 $ 3,181,367 Loan Sales Data: Agency Business Fannie Mae $ 867,601 $ 665,960 $ 2,175,846 $ 2,569,821 Freddie Mac 286,423 342,630 974,551 862,376 FHA 15,330 43,483 83,443 167,709 CMBS/Conduit 20,650 — 36,883 21,370 Total $ 1,190,004 $ 1,052,073 $ 3,270,723 $ 3,621,276 Sales margin (fee-based services as a % of loan sales) 1.47 % 1.63 % 1.57 % 1.52 % MSR rate (MSR income as a % of loan commitments) 1.83 % 2.04 % 1.79 % 1.77 % September 30, 2018 Wtd. Avg. Servicing Wtd. Avg. Life of UPB of Servicing Fee Rate Servicing Portfolio Key Servicing Metrics for Agency Business: Portfolio (basis points) (in years) Fannie Mae $ 13,195,643 52.3 7.7 Freddie Mac 3,977,619 30.8 11.0 FHA 621,419 15.7 20.1 Total $ 17,794,681 46.2 8.8 December 31, 2017 Fannie Mae $ 12,502,699 53.6 6.9 Freddie Mac 3,166,134 29.5 10.5 FHA 537,482 16.5 19.6 Total $ 16,206,315 47.7 8.1 |
Basis of Presentation and Sig_2
Basis of Presentation and Significant Accounting Policies (Policies) | 9 Months Ended |
Sep. 30, 2018 | |
Basis of Presentation and Significant Accounting Policies | |
Basis of Presentation | Basis of Presentation Our interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial statements and the instructions to Form 10-Q. Accordingly, certain information and footnote disclosures normally included in the consolidated financial statements prepared under GAAP have been condensed or omitted. In our opinion, all adjustments considered necessary for a fair presentation of our financial position, results of operations and cash flows have been included and are of a normal and recurring nature. 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. These financial statements should be read in conjunction with our financial statements and notes thereto included in our 2017 Annual Report. |
Reclassification | Reclassification Certain prior period amounts have been reclassified to conform to the current period presentation. See the following “Recently Adopted Accounting Pronouncements” section for the cash flows impact of the retrospective adoption of Accounting Standards Update (“ASU”) 2016-18, Statement of Cash Flows: Restricted Cash and ASU 2016-15, Statement of Cash Flows. |
Principles of Consolidation | Principles of Consolidation These consolidated financial statements include our financial statements and the financial statements of our wholly owned subsidiaries, partnerships and other joint ventures in which we own a controlling interest, including variable interest entities (“VIEs”) of which we are the primary beneficiary. Entities in which we have a significant influence are accounted for under the equity method. See Note 15 - Variable Interest Entities for information about our VIEs. All significant intercompany transactions and balances have been eliminated in consolidation. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that could materially affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. |
Recently Adopted and Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements Description Adoption Date Effect on Financial Statements Since 2014, the Financial Accounting Standards Board ("FASB") has issued several amendments to its guidance on revenue recognition. The amended guidance, among other things, introduces a new framework for a single comprehensive model that can be used when accounting for revenue and supersedes most current revenue recognition guidance, including that which pertains to specific industries. The core principle states that an entity should recognize revenue to depict the transfer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for such goods and services. It also requires expanded quantitative and qualitative disclosures that will enable financial statement users to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Most revenue associated with financial instruments, including interest and loan origination fees, along with gains and losses on investment securities, derivatives and sales of financial instruments are excluded from the scope of the guidance. First quarter of 2018 The adoption of this guidance did not have a material impact on our consolidated financial statements. This standard may impact the timing of gains on certain future sales of real estate. In November 2016, the FASB issued Accounting Standards Update ("ASU") 2016-18, Statement of Cash Flows: Restricted Cash. This ASU requires changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents to be shown in the statement of cash flows. Previous guidance required the change in cash and cash equivalents be shown on the statement of cash flows, with cash used to fund restricted cash and restricted cash equivalents shown as a component of operating, investing, or financing activities. Entities are now also required to reconcile the total of cash, cash equivalents, restricted cash, and restricted cash equivalents as presented in the statement of cash flows to the related captions in the balance sheet when these balances are presented separately in the balance sheet. First quarter of 2018 This guidance required retrospective adoption, therefore, we adjusted the cash flow statement for the comparable prior period. The following table shows the impact of the adoption of this guidance, as well as the adoption of ASU 2016-15 described below. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows, which provides eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. First quarter of 2018 This guidance required retrospective adoption, therefore, we reclassified $0.5 million of net proceeds from insurance settlements from net cash provided by operating activities to net cash used in investing activities for the nine months ended September 30, 2017. We also chose the cummulative earnings approach for distributions received from equity method investees, which did not result in any changes in how we account for such distributions. The following table shows the impact of the adoption of ASU 2016-15 and ASU 2016-18. Nine Months Ended (in thousands) September 30, 2017 As previously reported under GAAP applicable at the time Cash and cash equivalents at beginning of period $ 138,645 Net decrease in cash and cash equivalents (53,894) Cash and cash equivalents at end of period 84,751 Net cash provided by operating activities: changes in operating assets and liabilities (6,252) Net cash used in investing activities (350,841) Net cash used in financing activities (90,954) As currently reported under ASU 2016-18 and ASU 2016-15 Cash, cash equivalents and restricted cash at beginning of period $ 167,960 Net increase in cash, cash equivalents and restricted cash 53,930 Cash, cash equivalents and restricted cash at end of period 221,890 Net cash (used in) provided by operating activities: changes in operating assets and liabilities (6,368) Net cash used in investing activities (350,348) Net cash provided by financing activities 16,840 In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall: Consensuses of the FASB Emerging Issues Task Force. This ASU requires that unconsolidated equity investments not accounted for under the equity method be recorded at fair value, with changes in fair value recorded through net income. The accounting principles that permitted available-for-sale classification with unrealized holding gains and losses recorded in other comprehensive income for equity securities will no longer be applicable. In addition, financial liabilities measured using the fair value option will need to present any change in fair value caused by a change in instrument-specific credit risk separately in other comprehensive income. First quarter of 2018 The adoption of this guidance did not have a material impact on our consolidated financial statements. In connection with the adoption of this ASU, we reclassified $0.2 million of unrealized gains on available-for-sale securities from accumulated other comprehensive income to accumulated deficit. Recently Issued Accounting Pronouncements The following table is not intended to represent all recently issued accounting pronouncements that are not yet effective and which have not yet been adopted by us. This table should be read in conjunction with the recently issued accounting pronouncements section included in our 2017 Annual Report. Description Effective Date Effect on Financial Statements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which makes a number of changes meant to add, modify or remove certain disclosure requirements associated with changes between hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements. Early adoption is permitted upon issuance of the update. First quarter of 2020 We do not expect the adoption of this guidance to have a significant impact to our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This ASU requires lessees to record most leases on their balance sheet through operating and finance lease liabilities and corresponding right-of-use assets, as well as adding additional footnote disclosures of key information about those arrangements. In July 2018, the FASB also issued ASU 2018-11, Leases (Topic 842) - Targeted Improvements, which provides transition releif on comparative period reporting through a cummulative-effect adjustment at the beginning of the period of adoption. First quarter of 2019 We are currently evaluating this ASU and expect the adoption to increase both our total assets and total liabilities by less than 1%. We do not currently expect the adoption to have an impact on our consolidated results of operations. |
Basis of Presentation and Sig_3
Basis of Presentation and Significant Accounting Policies (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Basis of Presentation and Significant Accounting Policies | |
Schedules of Recently Adopted Accounting Pronouncements and Recently Issued Accounting Pronouncements | Recently Adopted Accounting Pronouncements Description Adoption Date Effect on Financial Statements Since 2014, the Financial Accounting Standards Board ("FASB") has issued several amendments to its guidance on revenue recognition. The amended guidance, among other things, introduces a new framework for a single comprehensive model that can be used when accounting for revenue and supersedes most current revenue recognition guidance, including that which pertains to specific industries. The core principle states that an entity should recognize revenue to depict the transfer of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for such goods and services. It also requires expanded quantitative and qualitative disclosures that will enable financial statement users to understand the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Most revenue associated with financial instruments, including interest and loan origination fees, along with gains and losses on investment securities, derivatives and sales of financial instruments are excluded from the scope of the guidance. First quarter of 2018 The adoption of this guidance did not have a material impact on our consolidated financial statements. This standard may impact the timing of gains on certain future sales of real estate. In November 2016, the FASB issued Accounting Standards Update ("ASU") 2016-18, Statement of Cash Flows: Restricted Cash. This ASU requires changes in the total of cash, cash equivalents, restricted cash, and restricted cash equivalents to be shown in the statement of cash flows. Previous guidance required the change in cash and cash equivalents be shown on the statement of cash flows, with cash used to fund restricted cash and restricted cash equivalents shown as a component of operating, investing, or financing activities. Entities are now also required to reconcile the total of cash, cash equivalents, restricted cash, and restricted cash equivalents as presented in the statement of cash flows to the related captions in the balance sheet when these balances are presented separately in the balance sheet. First quarter of 2018 This guidance required retrospective adoption, therefore, we adjusted the cash flow statement for the comparable prior period. The following table shows the impact of the adoption of this guidance, as well as the adoption of ASU 2016-15 described below. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows, which provides eight targeted changes to how cash receipts and cash payments are presented and classified in the statement of cash flows. First quarter of 2018 This guidance required retrospective adoption, therefore, we reclassified $0.5 million of net proceeds from insurance settlements from net cash provided by operating activities to net cash used in investing activities for the nine months ended September 30, 2017. We also chose the cummulative earnings approach for distributions received from equity method investees, which did not result in any changes in how we account for such distributions. The following table shows the impact of the adoption of ASU 2016-15 and ASU 2016-18. Nine Months Ended (in thousands) September 30, 2017 As previously reported under GAAP applicable at the time Cash and cash equivalents at beginning of period $ 138,645 Net decrease in cash and cash equivalents (53,894) Cash and cash equivalents at end of period 84,751 Net cash provided by operating activities: changes in operating assets and liabilities (6,252) Net cash used in investing activities (350,841) Net cash used in financing activities (90,954) As currently reported under ASU 2016-18 and ASU 2016-15 Cash, cash equivalents and restricted cash at beginning of period $ 167,960 Net increase in cash, cash equivalents and restricted cash 53,930 Cash, cash equivalents and restricted cash at end of period 221,890 Net cash (used in) provided by operating activities: changes in operating assets and liabilities (6,368) Net cash used in investing activities (350,348) Net cash provided by financing activities 16,840 In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall: Consensuses of the FASB Emerging Issues Task Force. This ASU requires that unconsolidated equity investments not accounted for under the equity method be recorded at fair value, with changes in fair value recorded through net income. The accounting principles that permitted available-for-sale classification with unrealized holding gains and losses recorded in other comprehensive income for equity securities will no longer be applicable. In addition, financial liabilities measured using the fair value option will need to present any change in fair value caused by a change in instrument-specific credit risk separately in other comprehensive income. First quarter of 2018 The adoption of this guidance did not have a material impact on our consolidated financial statements. In connection with the adoption of this ASU, we reclassified $0.2 million of unrealized gains on available-for-sale securities from accumulated other comprehensive income to accumulated deficit. Recently Issued Accounting Pronouncements The following table is not intended to represent all recently issued accounting pronouncements that are not yet effective and which have not yet been adopted by us. This table should be read in conjunction with the recently issued accounting pronouncements section included in our 2017 Annual Report. Description Effective Date Effect on Financial Statements In August 2018, the FASB issued ASU 2018-13, Fair Value Measurement (Topic 820) - Disclosure Framework - Changes to the Disclosure Requirements for Fair Value Measurement, which makes a number of changes meant to add, modify or remove certain disclosure requirements associated with changes between hierarchy associated with Level 1, Level 2 and Level 3 fair value measurements. Early adoption is permitted upon issuance of the update. First quarter of 2020 We do not expect the adoption of this guidance to have a significant impact to our consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842). This ASU requires lessees to record most leases on their balance sheet through operating and finance lease liabilities and corresponding right-of-use assets, as well as adding additional footnote disclosures of key information about those arrangements. In July 2018, the FASB also issued ASU 2018-11, Leases (Topic 842) - Targeted Improvements, which provides transition releif on comparative period reporting through a cummulative-effect adjustment at the beginning of the period of adoption. First quarter of 2019 We are currently evaluating this ASU and expect the adoption to increase both our total assets and total liabilities by less than 1%. We do not currently expect the adoption to have an impact on our consolidated results of operations. |
Loans and Investments (Tables)
Loans and Investments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Loans and Investments | |
Schedule of composition of company's structured business loan and investment portfolio | Our Structured Business loan and investment portfolio consists of ($ in thousands): Wtd. Avg. Remaining Wtd. Avg. Wtd. Avg. Percent of Loan Wtd. Avg. Months to First Dollar Last Dollar September 30, 2018 Total Count Pay Rate (1) Maturity LTV Ratio (2) LTV Ratio (3) Bridge loans $ 2,919,582 92 % 170 6.70 % 19.6 0 % 74 % Preferred equity investments 154,202 5 % 10 8.18 % 70.5 62 % 87 % Mezzanine loans 96,333 3 % 11 10.49 % 19.5 25 % 71 % 3,170,117 100 % 191 6.88 % 22.0 4 % 74 % Allowance for loan losses (60,951) Unearned revenue (11,477) Loans and investments, net $ 3,097,689 December 31, 2017 Bridge loans $ 2,422,105 91 % 150 % 0 % 72 % Preferred equity investments 142,892 6 % 12 % 64 % 90 % Mezzanine loans 87,541 3 % 8 % 20 % 63 % 2,652,538 100 % 170 % 4 % 73 % Allowance for loan losses (62,783) Unearned revenue (10,628) Loans and investments, net $ 2,579,127 (1) “Weighted Average Pay Rate” is a weighted average, based on the unpaid principal balance (“UPB”) of each loan in our portfolio, of the interest rate that is required to be paid monthly as stated in the individual loan agreements. Certain loans and investments that require an additional rate of interest “Accrual Rate” to be paid at maturity are not included in the weighted average pay rate as shown in the table. (2) The “First Dollar Loan-to-Value (“LTV”) Ratio” is calculated by comparing the total of our senior most dollar and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will absorb a total loss of our position. (3) The “Last Dollar LTV Ratio” is calculated by comparing the total of the carrying value of our loan and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will initially absorb a loss. |
Summary of the loan portfolio's weighted average internal risk ratings and LTV ratios by asset class | A summary of the loan portfolio’s weighted average internal risk ratings and LTV ratios by asset class is as follows ($ in thousands): September 30, 2018 Wtd. Avg. Wtd. Avg. Wtd. Avg. Percentage of Internal Risk First Dollar Last Dollar Asset Class UPB Portfolio Rating LTV Ratio LTV Ratio Multifamily $ 2,378,771 75 % pass/watch 4 % 74 % Self Storage 301,830 10 % pass/watch 0 % 72 % Land 151,628 5 % substandard 0 % 84 % Office 127,055 4 % special mention 0 % 66 % Healthcare 107,775 3 % pass/watch 0 % 81 % Hotel 55,975 2 % pass/watch 23 % 74 % Retail 45,383 1 % pass/watch 7 % 66 % Commercial 1,700 <1 % doubtful 63 % 63 % Total $ 3,170,117 100 % pass/watch 4 % 74 % December 31, 2017 Multifamily $ 1,925,529 73 % pass/watch 4 % 72 % Self Storage 301,830 11 % pass 0 % 71 % Land 132,828 5 % substandard 0 % 90 % Office 107,853 4 % pass/watch 1 % 64 % Healthcare 55,615 2 % pass/watch 0 % 74 % Hotel 90,725 3 % special mention 37 % 81 % Retail 36,458 1 % pass/watch 8 % 66 % Commercial 1,700 <1 % doubtful 63 % 63 % Total $ 2,652,538 100 % pass/watch 4 % 73 % |
Summary of the changes in the allowance for loan losses | A summary of the changes in the allowance for loan losses is as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Allowance at beginning of period $ 58,733 $ 81,256 $ 62,783 $ 83,712 Provision for loan losses 2,218 2,000 3,868 2,000 Recoveries of reserves — — (2,527) (2,456) Charge-offs — — (3,173) — Allowance at end of period $ 60,951 $ 83,256 $ 60,951 $ 83,256 |
Summary of the company's impaired loans by asset class | A summary of our impaired loans by asset class is as follows (in thousands): September 30, 2018 Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Allowance for Average Recorded Interest Income Average Recorded Interest Income Asset Class UPB Carrying Value (1) Loan Losses Investment (2) Recognized Investment (2) Recognized Land $ 134,215 $ 127,886 $ 57,751 $ 133,387 $ 26 $ 132,651 $ 75 Hotel — — — — — 17,375 — Office 2,274 2,274 1,500 2,277 33 2,281 93 Commercial 1,700 1,700 1,700 1,700 — 1,700 — Total $ 138,189 $ 131,860 $ 60,951 $ 137,364 $ 59 $ 154,007 $ 168 December 31, 2017 Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Land $ 131,086 $ 124,812 $ 53,883 $ 131,086 $ — $ 131,086 $ — Hotel 34,750 34,750 5,700 34,750 — 34,750 371 Office 2,288 2,288 1,500 27,551 28 27,556 79 Commercial 1,700 1,700 1,700 1,700 — 1,700 — Multifamily — — — — — 1,271 22 Total $ 169,824 $ 163,550 $ 62,783 $ 195,087 $ 28 $ 196,363 $ 472 (1) Represents the UPB of five and four impaired loans (less unearned revenue and other holdbacks and adjustments) by asset class at September 30, 2018 and December 31, 2017, respectively. (2) Represents an average of the beginning and ending UPB of each asset class. |
Summary of the company's non-performing loans by asset class | A summary of our non-performing loans by asset class is as follows (in thousands): September 30, 2018 December 31, 2017 Greater Than Greater Than Carrying Less Than 90 90 Days Past Carrying Less Than 90 90 Days Past Asset Class Value Days Past Due Due Value Days Past Due Due Commercial $ 1,700 $ — $ 1,700 $ 1,700 $ — $ 1,700 Hotel — — — 34,750 — 34,750 Office 831 — 831 — — — Total $ 2,531 $ — $ 2,531 $ 36,450 $ — $ 36,450 |
Loans Held-for-Sale, Net (Table
Loans Held-for-Sale, Net (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Loans Held-for-Sale, Net | |
Summary of loans held-for-sale, net | Loans held-for-sale, net consists of the following (in thousands): September 30, 2018 December 31, 2017 Fannie Mae $ 332,719 $ 243,717 Freddie Mac 133,441 47,545 FHA 26,806 987 492,966 292,249 Fair value of future MSR 8,459 5,806 Unearned discount (1,144) (612) Loans held-for-sale, net $ 500,281 $ 297,443 |
Capitalized Mortgage Servicin_2
Capitalized Mortgage Servicing Rights (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Capitalized Mortgage Servicing Rights | |
Summary of capitalized MSR activity | A summary of our capitalized MSR activity is as follows (in thousands): Three Months Ended September 30, 2018 Nine Months Ended September 30, 2018 Acquired Originated Total Acquired Originated Total Balance at beginning of period $ 120,017 $ 137,004 $ 257,021 $ 143,270 $ 109,338 $ 252,608 Additions — 21,368 21,368 — 59,660 59,660 Amortization (7,052) (4,786) (11,838) (22,564) (13,075) (35,639) Write-downs and payoffs (4,419) (2,731) (7,150) (12,160) (5,068) (17,228) Balance at end of period $ 108,546 $ 150,855 $ 259,401 $ 108,546 $ 150,855 $ 259,401 Three Months Ended September 30, 2017 Nine Months Ended September 30, 2017 Balance at beginning of period $ 168,189 $ 74,894 $ 243,083 $ 194,801 $ 32,942 $ 227,743 Additions — 20,720 20,720 — 66,273 66,273 Amortization (8,952) (2,759) (11,711) (29,074) (6,353) (35,427) Write-downs and payoffs (4,194) (22) (4,216) (10,684) (29) (10,713) Balance at end of period $ 155,043 $ 92,833 $ 247,876 $ 155,043 $ 92,833 $ 247,876 |
Schedule of expected amortization of capitalized MSRs recorded | Actual amortization may vary from these estimates. Year Amortization 2018 (three months ending 12/31/2018) $ 12,000 2019 45,946 2020 41,383 2021 34,919 2022 28,357 2023 23,850 Thereafter 72,946 Total $ 259,401 |
Mortgage Servicing (Tables)
Mortgage Servicing (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
MSRs | |
Mortgage Servicing | |
Schedule of product and geographic concentrations in servicing revenue | Product and geographic concentrations that impact our servicing revenue are as follows ($ in thousands): September 30, 2018 Product Concentrations Geographic Concentrations UPB Percent of Percentage Product UPB Total State of Total Fannie Mae $ 13,195,643 74 % Texas 21 % Freddie Mac 3,977,619 22 % North Carolina 10 % FHA 621,419 4 % California 8 % Total $ 17,794,681 100 % New York 8 % Georgia 6 % Florida 6 % Other (1) 41 % Total 100 % December 31, 2017 Product Concentrations Geographic Concentrations UPB Percent of Percentage Product UPB Total State of Total Fannie Mae $ 77 % Texas 22 % Freddie Mac 3,166,134 20 % North Carolina 10 % FHA 537,482 3 % California 8 % Total $ 100 % New York 8 % Georgia 6 % Florida 6 % Other (1) 40 % Total 100 % (1) No other individual state represented 4% or more of the total. |
Securities Held-to-Maturity (Ta
Securities Held-to-Maturity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Securities Held-to-Maturity | |
Summary of B Piece bonds classified as held-to-maturity securities | The following is a summary of our B Piece bonds classified as securities held-to-maturity (in thousands): Unrealized Estimated Fair Period Face Value Carrying Value Gain Value September 30, 2018 $ 70,518 $ 50,520 $ 1,792 $ 52,312 December 31, 2017 $ 40,566 $ 27,837 $ 602 $ 28,439 |
Investments in Equity Affilia_2
Investments in Equity Affiliates (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Investments in Equity Affiliates | |
Summary of the company's investments in equity affiliates | The following is a summary of our investments in equity affiliates (in thousands): UPB of Loans to Investments in Equity Affiliates at Equity Affiliates at Equity Affiliates September 30, 2018 December 31, 2017 September 30, 2018 Arbor Residential Investor LLC $ 19,781 $ 19,193 $ — Lightstone Value Plus REIT L.P. 1,895 1,895 — JT Prime 425 425 — West Shore Café — 2,140 1,688 East River Portfolio — — — Lexford Portfolio — — 280,500 Total $ 22,101 $ 23,653 $ 282,188 |
Real Estate Owned and Held-For-
Real Estate Owned and Held-For-Sale (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Real Estate Owned | |
Schedule of real estate owned | September 30, 2018 December 31, 2017 Hotel Office Hotel Office (in thousands) Property Building Total Property Building Total Land $ 3,294 $ 4,509 $ 7,803 $ 3,294 $ 4,509 $ 7,803 Building and intangible assets 31,008 2,010 33,018 30,699 2,010 32,709 Less: Impairment loss (13,307) (2,500) (15,807) (13,307) (500) (13,807) Less: Accumulated depreciation and amortization (9,642) (809) (10,451) (9,228) (690) (9,918) Real estate owned, net $ 11,353 $ 3,210 $ 14,563 $ 11,458 $ 5,329 $ 16,787 |
Debt Obligations (Tables)
Debt Obligations (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Debt Obligations | |
Schedule of face amount and gain on extinguishment of the company's CDO bonds repurchased by bond class | Borrowings and the corresponding collateral under our Debt Fund are as follows ($ in thousands): Debt Collateral (3) Loans Cash Face Carrying Wtd. Avg. Carrying Restricted Period Value Value (1) Rate (2) UPB Value Cash (4) September 30, 2018 $ 70,000 $ 68,099 6.50 % $ 98,696 $ 98,261 $ — December 31, 2017 $ 70,000 $ 68,084 5.79 % $ 96,995 $ 96,564 $ 3,005 (1) Debt carrying value is net of $1.9 million of deferred financing fees at both September 30, 2018 and December 31, 2017. (2) At September 30, 2018 and December 31, 2017, the aggregate weighted average note rate, including certain fees and costs, was 7.08% and 6.05%, respectively. (3) At both September 30, 2018 and December 31, 2017, there was no collateral at risk of default or deemed to be a “credit risk.” (4) Represents restricted cash held for reinvestment. Excludes restricted cash related to interest payments, delayed fundings and expenses. |
Schedule of face value, unamortized discount and net carrying value of the liability and equity components | The UPB, unamortized discount and net carrying amount of the liability and equity components of our convertible notes were as follows (in thousands): Liability Equity Component Component Unamortized Debt Unamortized Deferred Net Carrying Net Carrying Period UPB Discount Financing Fees Value Value September 30, 2018 $ 280,816 $ 9,285 $ 7,878 $ 263,653 $ 9,436 December 31, 2017 $ 243,750 $ 5,742 $ 6,721 $ 231,287 $ 6,733 |
Credit Facilities and Repurchase Agreements | |
Debt Obligations | |
Schedule of borrowings | The following table outlines borrowings under our credit facilities and repurchase agreements ($ in thousands): September 30, 2018 December 31, 2017 Debt Collateral Wtd. Debt Collateral Wtd. Current Extended Carrying Carrying Avg. Note Carrying Carrying Avg. Note Structured Business Maturity Maturity Note Rate Value (1) Value Rate Value (1) Value Rate $375 million repurchase facility Mar. 2020 Mar. 2021 L+ 1.75 % to 3.50 % $ 334,582 $ 470,650 4.53 % $ 102,350 $ 145,850 3.90 % $100 million repurchase facility June 2019 June 2020 L+ 1.75 % to 2.00 % 94,024 132,107 4.09 % 2,445 6,600 3.61 % $75 million credit facility Dec. 2018 N/A L+ 1.75 % to 2.50 % 20,355 30,469 4.07 % — — — $75 million credit facility June 2019 N/A L+ 2.00 % 14,482 21,000 4.32 % 8,999 16,000 3.61 % $50 million credit facility Feb. 2019 N/A L+ 2.00 % 28,557 35,700 4.32 % 32,538 40,700 3.61 % $50 million credit facility Sept. 2019 Sept. 2021 L+ 2.50 % to 3.25 % — — — 3,581 4,625 4.88 % $25.5 million credit facility Oct. 2019 N/A L+ 2.50 % 15,773 34,000 4.83 % 13,920 18,753 4.12 % $25 million working capital facility June 2019 N/A L+ 2.25 % — — — 10,000 — 4.12 % $23.2 million credit facility Feb. 2020 Feb. 2021 L+ 2.30 % 23,068 30,900 4.62 % — — — $20 million credit facility Mar. 2020 Mar. 2021 L+ 2.50 % 19,904 41,650 4.83 % — — — $17.4 million credit facility June 2020 June 2021 L+ 2.40 % 12,405 15,844 4.73 % — — — $8 million credit facility Aug. 2021 N/A L+ 2.50 % 7,941 10,000 4.83 — — — $7.5 million credit facility (2) Sept. 2018 N/A L+ 2.75 % — — — 7,432 9,340 4.37 % Repurchase facility - securities (3) N/A N/A L+ 2.35 % to 3.25 % 102,701 — 4.97 % 53,938 — 4.45 % $3 million master security agreement Oct. 2020 N/A 2.96 % to 3.42 % 1,337 — 3.20 % 1,834 — 3.21 % $2.2 million master security agreement Mar. 2021 N/A 4.60 % 1,854 — 4.66 % — — — Structured Business total $ 676,983 $ 822,320 4.53 % $ 237,037 $ 241,868 4.02 % Agency Business $500 million ASAP agreement (4) N/A N/A L+ 1.05 % $ 96,617 $ 96,617 3.31 % $ 121,880 $ 121,880 2.61 % $250 million credit facility (5) June 2019 N/A L+ 1.25 % 102,180 102,182 3.51 % 23,785 23,785 2.86 % $200 million repurchase facility Aug. 2019 N/A L+ 1.275 % 73,573 73,573 3.54 % 24,827 24,873 2.91 % $150 million credit facility Jan . 2019 N/A L+ 1.30 % 136,567 136,644 3.56 % 21,802 21,821 2.96 % $150 million credit facility July 2019 N/A L+ 1.30 % 83,666 83,783 3.56 % 99,242 99,357 2.91 % Agency Business total $ 492,603 $ 492,799 3.50 % $ 291,536 $ 291,716 2.78 % Consolidated total $ 1,169,586 $ 1,315,119 4.10 % $ 528,573 $ 533,584 3.34 % (1) The debt carrying value for the Structured Business at September 30, 2018 and December 31, 2017 was net of unamortized deferred finance costs of $2.6 million and $2.2 million, respectively. The debt carrying value for the Agency Business at both September 30, 2018 and December 31, 2017 was net of unamortized deferred finance costs of $0.2 million. (2) In September 2018, the loan collateralizing this facility paid off and we simultaneously repaid this facility. (3) As of September 30, 2018 and December 31, 2017, this facility was collateralized by CLO bonds retained by us with a principal balance of $114.2 million and $61.0 million, respectively, and B Piece bonds with a carrying value of $50.5 million and $27.8 million, respectively. (4) The note rate under this agreement is subject to a LIBOR Floor of 35 basis points. (5) The committed amount under the facility was temporarily increased $150.0 million to $250.0 million, which expires in January 2019. |
CLOs | |
Debt Obligations | |
Schedule of borrowings | The following table outlines borrowings and the corresponding collateral under our CLOs ($ in thousands): Debt Collateral (3) Loans Cash Face Carrying Wtd. Avg. Carrying Restricted September 30, 2018 Value Value (1) Rate (2) UPB Value Cash (4) CLO X $ 441,000 $ 436,132 3.76 % $ 510,303 $ 508,357 $ 42,032 CLO IX 356,400 351,934 3.67 % 417,089 415,776 3,911 CLO VIII 282,874 279,538 3.62 % 304,078 303,302 39,409 CLO VII 279,000 276,221 4.31 % 285,134 284,322 43,885 CLO VI 250,250 248,264 4.81 % 276,083 275,086 40,342 Total CLOs $ 1,609,524 $ 1,592,089 3.98 % $ 1,792,687 $ 1,786,843 $ 169,579 December 31, 2017 CLO IX $ 356,400 $ 351,042 2.97 % $ 372,350 $ 371,236 $ 88,650 CLO VIII 282,874 278,606 2.92 % 364,838 363,339 162 CLO VII 279,000 275,331 3.61 % 346,524 345,220 13,476 CLO VI 250,250 247,470 4.10 % 314,382 313,582 10,618 CLO V 267,750 265,973 4.06 % 347,797 346,803 2,203 Total CLOs $ 1,436,274 $ 1,418,422 3.48 % $ 1,745,891 $ 1,740,180 $ 115,109 (1) Debt carrying value is net of $17.4 million and $17.9 million of deferred financing fees at September 30, 2018 and December 31, 2017, respectively. (2) At September 30, 2018 and December 31, 2017, the aggregate weighted average note rate for our CLOs, including certain fees and costs, was 4.49% and 4.08%, respectively. (3) As of September 30, 2018 and December 31, 2017, there was no collateral at risk of default or deemed to be a “credit risk” as defined by the CLO indenture. (4) Represents restricted cash held for principal repayments as well as for reinvestment in the CLOs. Does not include restricted cash related to interest payments, delayed fundings and expenses. |
Summary of the company's CLO compliance tests as of the most recent determination dates | A summary of our CLO compliance tests as of the most recent determination dates in October 2018 is as follows: Cash Flow Triggers CLO VI CLO VII CLO VIII CLO IX CLO X Overcollateralization (1) Current 129.87 % 129.03 % 129.03 % 134.68 % 126.98 % Limit 128.87 % 128.03 % 128.03 % 133.68 % 125.98 % Pass / Fail Pass Pass Pass Pass Pass Interest Coverage (2) Current 208.68 % 212.40 % 268.75 % 276.05 % 236.32 % Limit 120.00 % 120.00 % 120.00 % 120.00 % 120.00 % Pass / Fail Pass Pass Pass Pass Pass (1) The overcollateralization ratio divides the total principal balance of all collateral in the CLO by the total principal balance of the bonds associated with the applicable ratio. To the extent an asset is considered a defaulted security, the asset’s principal balance for purposes of the overcollateralization test is the lesser of the asset’s market value or the principal balance of the defaulted asset multiplied by the asset’s recovery rate which is determined by the rating agencies. Rating downgrades of CLO collateral will generally not have a direct impact on the principal balance of a CLO asset for purposes of calculating the CLO overcollateralization test unless the rating downgrade is below a significantly low threshold (e.g. CCC-) as defined in each CLO vehicle. (2) The interest coverage ratio divides interest income by interest expense for the classes senior to those retained by us. |
Summary of the Company's CLO overcollateralization ratios | Determination (1) CLO VI CLO VII CLO VIII CLO IX CLO X October 2018 129.87 % 129.03 % 129.03 % 134.68 % 126.98 % July 2018 129.87 % 129.03 % 129.03 % 134.68 % 126.98 % April 2018 129.87 % 129.03 % 129.03 % 134.69 % — January 2018 129.87 % 129.03 % 129.03 % 134.68 % — October 2017 129.87 % 129.03 % 129.03 % — — (1) The table above represents the quarterly trend of our overcollateralization ratio, however, the CLO determination dates are monthly and we were in compliance with this test for all periods presented. |
Allowance for Loss-Sharing Ob_2
Allowance for Loss-Sharing Obligations (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Allowance for Loss-Sharing Obligations | |
Schedule of allowance for loss-sharing obligations related to Fannie Mae DUS program | Our allowance for loss-sharing obligations related to the Fannie Mae DUS program is as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Beginning balance $ 31,402 $ 32,797 $ 30,511 $ 32,407 Provisions for loss sharing 2,924 1,265 5,263 5,410 Provisions reversal for loan repayments (905) (3,882) (2,423) (5,815) (Charge-offs) recoveries, net (16) (22) 54 (1,844) Ending balance $ 33,405 $ 30,158 $ 33,405 $ 30,158 |
Derivative Financial Instrume_2
Derivative Financial Instruments (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Agency Business | |
Schedule of non-qualifying derivative financial instruments | The following is a summary of our non-qualifying derivative financial instruments held by our Agency Business ($ in thousands): September 30, 2018 Fair Value Notional Balance Sheet Derivative Derivative Derivative Count Value Location Assets Liabilities Rate Lock Commitments 6 $ 37,965 Other Assets/Other Liabilities $ 749 $ (28) Forward Sale Commitments 57 530,931 Other Assets/Other Liabilities 177 (3,378) $ 568,896 $ 926 $ (3,406) December 31, 2017 Rate Lock Commitments 3 $ 38,578 Other Assets/Other Liabilities $ 276 $ (278) Forward Sale Commitments 75 330,827 Other Assets/Other Liabilities 408 (1,028) $ 369,405 $ 684 $ (1,306) |
Fair Value (Tables)
Fair Value (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Fair Value | |
Summary of the principal amounts, carrying values and the estimated fair values of the Company's financial instruments | The following table summarizes the principal amounts, carrying values and the estimated fair values of our financial instruments (in thousands): September 30, 2018 December 31, 2017 Principal / Carrying Estimated Principal / Carrying Estimated Notional Amount Value Fair Value Notional Amount Value Fair Value Financial assets: Loans and investments, net $ 3,170,117 $ 3,097,689 $ 3,154,139 $ 2,652,538 $ 2,579,127 $ 2,652,520 Loans held-for-sale, net 492,966 500,281 507,698 292,249 297,443 302,883 Capitalized mortgage servicing rights, net n/a 259,401 312,316 n/a 252,608 286,073 Securities held-to-maturity, net 70,518 50,520 52,312 40,566 27,837 28,439 Derivative financial instruments 155,202 926 926 77,984 684 684 Financial liabilities: Credit and repurchase facilities $ 1,172,413 $ 1,169,586 $ 1,170,235 $ 530,938 $ 528,573 $ 529,992 Collateralized loan obligations 1,609,524 1,592,089 1,616,293 1,436,274 1,418,422 1,436,871 Debt fund 70,000 68,099 70,135 70,000 68,084 70,000 Senior unsecured notes 125,000 122,358 124,375 97,860 95,280 99,582 Convertible senior unsecured notes, net 280,816 263,653 289,560 243,750 231,287 254,335 Junior subordinated notes 154,336 140,084 95,458 154,336 139,590 94,215 Related party financing — — — 50,000 50,000 49,682 Derivative financial instruments 413,694 3,406 3,406 291,421 1,306 1,306 |
Schedule of certain financial assets and financial liabilities measured at fair value on a recurring basis | The fair values of these financial assets and liabilities were determined using the following input levels as of September 30, 2018 (in thousands): Fair Value Measurements Using Fair Carrying Value Hierarchy Value Fair Value Level 1 Level 2 Level 3 Financial assets: Derivative financial instruments $ 926 $ 926 $ — $ 177 $ 749 Financial liabilities: Derivative financial instruments $ 3,406 $ 3,406 $ — $ 3,406 $ — |
Schedule of certain financial assets and financial liabilities measured at fair value on a nonrecurring basis | The fair values of these financial and non-financial assets were determined using the following input levels as of September 30, 2018 (in thousands): Fair Value Measurements Using Fair Net Carrying Value Hierarchy Value Fair Value Level 1 Level 2 Level 3 Financial assets: Impaired loans, net (1) $ 70,909 $ 70,909 $ — $ — $ 70,909 Non-financial assets: Long-lived assets (2) $ 14,563 $ 14,563 $ — $ — $ 14,563 (1) We had an allowance for loan losses of $61.0 million relating to five loans with an aggregate carrying value, before loan loss reserves, of $131.9 million at September 30, 2018. (2) We recorded a $2.0 million impairment loss during the nine months ended September 30, 2018 on the office building we own. See Note 9 - Real Estate Owned for details. |
Schedule of quantitative information about Level 3 fair value measurements | Quantitative information about Level 3 fair value measurements at September 30, 2018 were as follows ($ in thousands): Valuation Fair Value Techniques Significant Unobservable Inputs Financial assets: Impaired loans: Land $ 70,135 Discounted cash flows Discount rate 15.00 % Capitalization rate 7.25 % Revenue growth rate 3.00 % Office 774 Discounted cash flows Discount rate 10.53 % Capitalization rate 8.53 % Revenue growth rate 2.63 % Derivative financial instruments: Rate lock commitments 749 Discounted cash flows W/A discount rate 10.15 % Non-financial assets: Long-lived assets: Office Building $ 3,210 Broker quotes N/A N/A |
Schedule of roll forward of Level 3 derivative instruments | A roll-forward of Level 3 derivative instruments were as follows (in thousands): Fair Value Measurements Using Significant Unobservable Inputs Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Derivative assets and liabilities, net Balance at beginning of period $ 606 $ 1,420 $ 276 $ 2,816 Settlements (17,793) (18,897) (62,313) (57,578) Realized gains recorded in earnings 17,187 17,477 62,037 54,762 Unrealized gains recorded in earnings 749 420 749 420 Balance at end of period $ 749 $ 420 $ 749 $ 420 |
Schedule of components of fair value and other relevant information | The components of fair value and other relevant information associated with our rate lock commitments, forward sales commitments and the estimated fair value of cash flows from servicing on loans held-for-sale were as follows (in thousands): Notional/ Fair Value of Interest Rate Total Fair Value September 30, 2018 Principal Amount Servicing Rights Movement Effect Adjustment Rate lock commitments $ 37,965 $ 749 $ (28) $ 721 Forward sale commitments 530,931 — 28 28 Loans held-for-sale, net (1) 492,966 8,459 — 8,459 Total $ 9,208 $ — $ 9,208 (1) Loans held-for-sale, net are recorded at the lower of cost or market on an aggregate basis and includes fair value adjustments related to estimated cash flows from MSRs. |
Schedule of fair value of assets and liabilities | The fair value of these assets and liabilities was determined using the following input levels as of September 30, 2018 (in thousands): Fair Value Measurements Using Fair Value Hierarchy Carrying Value Fair Value Level 1 Level 2 Level 3 Financial assets: Loans and investments, net $ 3,097,689 $ 3,154,139 $ — $ — $ 3,154,139 Loans held-for-sale, net 500,281 507,698 — 499,239 8,459 Capitalized mortgage servicing rights, net 259,401 312,316 — — 312,316 Securities held-to-maturity, net 50,520 52,312 — — 52,312 Financial liabilities: Credit and repurchase facilities $ 1,169,586 $ 1,170,235 $ — $ 492,603 $ 677,632 Collateralized loan obligations 1,592,089 1,616,293 — — 1,616,293 Debt fund 68,099 70,135 — — 70,135 Senior unsecured notes 122,358 124,375 124,375 — — Convertible senior unsecured notes, net 263,653 289,560 — 289,560 — Junior subordinated notes 140,084 95,458 — — 95,458 |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Variable Interest Entities | |
Schedule of the assets and liabilities related to the consolidated CLOs and Debt Fund | The assets and liabilities related to these consolidated CLOs and Debt Fund are as follows (in thousands): September 30, 2018 December 31, 2017 Assets: Restricted cash $ 201,986 $ 138,736 Loans and investments, net 1,885,104 1,836,744 Due from related party 95,045 — Other assets 15,408 14,011 Total assets $ 2,197,543 $ 1,989,491 Liabilities: Collateralized loan obligations $ 1,592,089 $ 1,418,422 Debt fund 68,099 68,084 Other liabilities 3,013 2,046 Total liabilities $ 1,663,201 $ 1,488,552 |
Summary of the Company's variable interests in identified VIEs, of which the company is not the primary beneficiary | The following is a summary of our variable interests in identified VIEs, of which we are not the primary beneficiary, as of September 30, 2018 (in thousands): Type Carrying Amount (1) Loans $ 287,166 B Piece bonds 50,520 Agency interest only strips 3,512 Total $ 341,198 (1) Represents the carrying amount of loans and investments before reserves. At September 30, 2018, $130.2 million of loans to VIEs had corresponding loan loss reserves of $59.3 million. See Note 3 - Loans and Investments for details. In addition, the maximum loss exposure as of September 30, 2018 would not exceed the carrying amount of our investment. |
Equity (Tables)
Equity (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Equity | |
Schedule of dividends declared by the Company (on a per share basis) | Dividends declared (on a per share basis) during the nine months ended September 30, 2018 were as follows: Common Stock Preferred Stock Dividend (1) Declaration Date Dividend Declaration Date Series A Series B Series C February 21, 2018 $ 0.21 February 2, 2018 $ 0.515625 $ 0.484375 $ 0.53125 May 2, 2018 $ 0.25 May 2, 2018 $ 0.515625 $ 0.484375 $ 0.53125 August 1, 2018 $ August 1, 2018 $ $ $ (1) The dividend declared on August 1, 2018 was for June 1, 2018 through August 31, 2018, the dividend declared on May 2, 2018 was for March 1, 2018 through May 31, 2018 and the dividend declared on February 2, 2018 was for December 1, 2017 through February 28, 2018. |
Schedule of reconciliation of the numerator and denominator of the basic and diluted EPS computations | The following tables reconcile the numerator and denominator of our basic and diluted EPS computations ($ in thousands, except share and per share data): Three Months Ended September 30, 2018 2017 Basic Diluted Basic Diluted Net income attributable to common stockholders (1) $ 27,737 $ 27,737 $ 16,421 $ 16,421 Net income attributable to noncontrolling interest (2) — 7,799 — 5,662 Net income attributable to common stockholders and noncontrolling interest $ 27,737 $ 35,536 $ 16,421 $ 22,083 Weighted average shares outstanding 74,802,582 74,802,582 61,582,796 61,582,796 Dilutive effect of OP Units (2) — 21,023,735 — 21,230,769 Dilutive effect of restricted stock units (3) — 1,559,217 — 1,104,552 Dilutive effect of convertible notes (4) — 1,050,430 — — Weighted average shares outstanding Net income per common share (1) $ 0.37 $ 0.36 $ 0.27 $ 0.26 Nine Months Ended September 30, 2018 2017 Net income attributable to common stockholders (1) $ 71,093 $ 71,093 $ 43,964 $ 43,964 Net income attributable to noncontrolling interest (2) — 22,347 — 16,597 Net income attributable to common stockholders and noncontrolling interest $ 71,093 $ 93,440 $ 43,964 $ 60,561 Weighted average shares outstanding 67,490,132 67,490,132 56,602,504 56,602,504 Dilutive effect of OP Units (2) — 21,160,999 — 21,230,769 Dilutive effect of restricted stock units (3) — 1,441,264 — 1,077,178 Dilutive effect of convertible notes (4) — 1,041,212 — 32,468 Weighted average shares outstanding 67,490,132 91,133,607 56,602,504 78,942,919 Net income per common share (1) $ 1.05 $ 1.03 $ 0.78 $ 0.77 (1) Net of preferred stock dividends. (2) We consider OP Units to be common stock equivalents as the holders have voting rights, the right to distributions and the right to redeem the OP Units for the cash value of a corresponding number of shares of common stock or a corresponding number of shares of common stock, at our election. (3) Mr. Kaufman is granted restricted stock units annually, which vest at the end of a four-year performance period based upon our achievement of total stockholder return objectives. (4) The convertible senior unsecured notes impact diluted earnings per share if the average price of our common stock exceeds the conversion price, as calculated in accordance with the terms of the indenture. |
Segment Information (Tables)
Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2018 | |
Segment Information | |
Schedule of statement of income and balance sheet by segment | Three Months Ended September 30, 2018 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 61,232 $ 6,268 $ — $ 67,500 Interest expense 35,508 4,040 — 39,548 Net interest income 25,724 2,228 — 27,952 Other revenue: Gain on sales, including fee-based services, net — 17,451 — 17,451 Mortgage servicing rights — 25,216 — 25,216 Servicing revenue — 26,082 — 26,082 Amortization of MSRs — (11,838) — (11,838) Property operating income 2,651 — — 2,651 Other income, net 406 (4,388) — (3,982) Total other revenue 3,057 52,523 — 55,580 Other expenses: Employee compensation and benefits 6,683 21,092 — 27,775 Selling and administrative 4,465 5,529 — 9,994 Property operating expenses 2,437 — — 2,437 Depreciation and amortization 447 1,401 — 1,848 Provision for loss sharing (net of recoveries) — 2,019 — 2,019 Provision for loan losses (net of recoveries) 836 — — 836 Litigation settlement gain (10,170) — — (10,170) Total other expenses 4,698 30,041 — 34,739 Income before extinguishment of debt, loss from equity affiliates and income taxes 24,083 24,710 — 48,793 Loss on extinguishment of debt (4,960) — — (4,960) Loss from equity affiliates (1,028) — — (1,028) Provision for income taxes — (5,381) — (5,381) Net income 18,095 19,329 — 37,424 Preferred stock dividends 1,888 — — 1,888 Net income attributable to noncontrolling interest — — 7,799 7,799 Net income attributable to common stockholders $ 16,207 $ 19,329 $ (7,799) $ 27,737 Three Months Ended September 30, 2017 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 37,259 $ 4,881 $ — $ 42,140 Interest expense 19,913 2,975 962 23,850 Net interest income 17,346 1,906 (962) 18,290 Other revenue: Gain on sales, including fee-based services, net — 17,126 — 17,126 Mortgage servicing rights — 18,897 — 18,897 Servicing revenue — 20,231 — 20,231 Amortization of MSRs — (11,711) — (11,711) Property operating income 2,668 — — 2,668 Other income, net 540 238 — 778 Total other revenue 3,208 44,781 — 47,989 Other expenses: Employee compensation and benefits 5,670 19,524 — 25,194 Selling and administrative 3,014 4,593 — 7,607 Property operating expenses 2,583 — — 2,583 Depreciation and amortization 429 1,400 — 1,829 Provision for loss sharing (net of recoveries) — (2,617) — (2,617) Provision for loan losses (net of recoveries) 2,000 — — 2,000 Total other expenses 13,696 22,900 — 36,596 Income before income from equity affiliates and income taxes 6,858 23,787 (962) 29,683 Income from equity affiliates 996 — — 996 Provision for income taxes — (6,708) — (6,708) Net income 7,854 17,079 (962) 23,971 Preferred stock dividends 1,888 — — 1,888 Net income attributable to noncontrolling interest — — 5,662 5,662 Net income attributable to common stockholders $ 5,966 $ 17,079 $ (6,624) $ 16,421 Nine Months Ended September 30, 2018 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 162,645 $ 15,763 $ — $ 178,408 Interest expense 100,324 10,166 329 110,819 Net interest income 62,321 5,597 (329) 67,589 Other revenue: Gain on sales, including fee-based services, net — 51,266 — 51,266 Mortgage servicing rights — 62,787 — 62,787 Servicing revenue — 70,301 — 70,301 Amortization of MSRs — (35,639) — (35,639) Property operating income 8,525 — — 8,525 Other income, net 757 (2,331) — (1,574) Total other revenue 9,282 146,384 — 155,666 Other expenses: Employee compensation and benefits 21,019 63,065 — 84,084 Selling and administrative 11,500 16,283 — 27,783 Property operating expenses 8,089 — — 8,089 Depreciation and amortization 1,338 4,201 — 5,539 Impairment loss on real estate owned 2,000 — — 2,000 Provision for loss sharing (net of recoveries) — 2,840 — 2,840 Provision for loan losses (net of recoveries) (967) — — (967) Litigation settlement gain (10,170) — — (10,170) Total other expenses 32,809 86,389 — 119,198 Income before extinguishment of debt, income from equity affiliates and income taxes 38,794 65,592 (329) 104,057 Loss on extinguishment of debt (4,960) — — (4,960) Income from equity affiliates 1,104 — — 1,104 Benefit from (provision for) income taxes 500 (1,596) — (1,096) Net income 35,438 63,996 (329) 99,105 Preferred stock dividends 5,665 — — 5,665 Net income attributable to noncontrolling interest — — 22,347 22,347 Net income attributable to common stockholders $ 29,773 $ 63,996 $ (22,676) $ 71,093 Nine Months Ended September 30, 2017 Structured Agency Other / Business Business Eliminations (1) Consolidated Interest income $ 95,685 $ 14,448 $ — $ 110,133 Interest expense 51,866 8,946 2,886 63,698 Net interest income 43,819 5,502 (2,886) 46,435 Other revenue: Gain on sales, including fee-based services, net — 55,127 — 55,127 Mortgage servicing rights — 56,182 — 56,182 Servicing revenue — 55,350 — 55,350 Amortization of MSRs — (35,427) — (35,427) Property operating income 8,755 — — 8,755 Other income, net 1,381 (2,312) — (931) Total other revenue 10,136 128,920 — 139,056 Other expenses: Employee compensation and benefits 13,570 53,291 — 66,861 Selling and administrative 8,993 14,143 — 23,136 Property operating expenses 7,843 — — 7,843 Depreciation and amortization 1,341 4,201 — 5,542 Impairment loss on real estate owned 2,700 — — 2,700 Provision for loss sharing (net of recoveries) — (405) — (405) Provision for loan losses (net of recoveries) (457) — — (457) Management fee - related party 3,259 3,414 — 6,673 Total other expenses 37,249 74,644 — 111,893 Income before extinguishment of debt, income from equity affiliates and income taxes 16,706 59,778 (2,886) 73,598 Gain on extinguishment of debt 7,116 — — 7,116 Income from equity affiliates 1,756 — — 1,756 Provision for income taxes — (16,244) — (16,244) Net income 25,578 43,534 (2,886) 66,226 Preferred stock dividends 5,665 — — 5,665 Net income attributable to noncontrolling interest — — 16,597 16,597 Net income attributable to common stockholders $ 19,913 $ 43,534 $ (19,483) $ 43,964 (1) Includes certain corporate expenses not allocated to the two reportable segments, such as financing costs associated with the Acquisition, as well as income allocated to the noncontrolling interest holders. September 30, 2018 Structured Business Agency Business Other / Eliminations Consolidated Assets: Cash and cash equivalents $ 45,001 $ 47,597 $ — $ 92,598 Restricted cash 202,736 — — 202,736 Loans and investments, net 3,097,689 — — 3,097,689 Loans held-for-sale, net — 500,281 — 500,281 Capitalized mortgage servicing rights, net — 259,401 — 259,401 Securities held to maturity — 50,520 — 50,520 Investments in equity affiliates 22,101 — — 22,101 Goodwill and other intangible assets 12,500 105,065 — 117,565 Other assets 172,078 19,291 — 191,369 Total assets $ 3,552,105 $ 982,155 $ — $ 4,534,260 Liabilities: Debt obligations $ 2,863,266 $ 492,603 $ — $ 3,355,869 Allowance for loss-sharing obligations — 33,405 — 33,405 Other liabilities 140,662 37,852 — 178,514 Total liabilities $ 3,003,928 $ 563,860 $ — $ 3,567,788 December 31, 2017 Structured Business Agency Business Other / Eliminations Consolidated Assets: Cash and cash equivalents $ 37,056 $ 67,318 $ — $ 104,374 Restricted cash 139,398 — — 139,398 Loans and investments, net 2,579,127 — — 2,579,127 Loans held-for-sale, net — 297,443 — 297,443 Capitalized mortgage servicing rights, net — 252,608 — 252,608 Securities held-to-maturity, net — 27,837 — 27,837 Investments in equity affiliates 23,653 — — 23,653 Goodwill and other intangible assets 12,500 109,266 — 121,766 Other assets 66,227 13,512 — 79,739 Total assets $ 2,857,961 $ 767,984 $ — $ 3,625,945 Liabilities: Debt obligations $ 2,189,700 $ 291,536 $ 50,000 $ 2,531,236 Allowance for loss-sharing obligations — 30,511 — 30,511 Other liabilities 155,814 42,819 1,009 199,642 Total liabilities $ 2,345,514 $ 364,866 $ 51,009 $ 2,761,389 |
Schedule of origination data and loan sales data | Three Months Ended September 30, Nine Months Ended September 30, 2018 2017 2018 2017 Origination Data: Structured Business New loan originations $ 287,480 $ 473,171 $ 1,208,550 $ 1,057,004 Loan payoffs / paydowns 255,575 270,010 684,216 723,977 Agency Business Origination Volumes by Investor: Fannie Mae $ 995,662 $ 650,374 $ 2,264,870 $ 2,216,820 Freddie Mac 317,516 328,075 1,060,456 880,597 FHA 77,236 18,273 137,973 189,087 CMBS/Conduit 20,650 — 36,883 21,370 Total $ 1,411,064 $ 996,722 $ 3,500,182 $ 3,307,874 Total loan commitment volume $ 1,376,376 $ 928,181 $ 3,499,569 $ 3,181,367 Loan Sales Data: Agency Business Fannie Mae $ 867,601 $ 665,960 $ 2,175,846 $ 2,569,821 Freddie Mac 286,423 342,630 974,551 862,376 FHA 15,330 43,483 83,443 167,709 CMBS/Conduit 20,650 — 36,883 21,370 Total $ 1,190,004 $ 1,052,073 $ 3,270,723 $ 3,621,276 Sales margin (fee-based services as a % of loan sales) 1.47 % 1.63 % 1.57 % 1.52 % MSR rate (MSR income as a % of loan commitments) 1.83 % 2.04 % 1.79 % 1.77 % |
Schedule of key servicing metrics for Agency Business | September 30, 2018 Wtd. Avg. Servicing Wtd. Avg. Life of UPB of Servicing Fee Rate Servicing Portfolio Key Servicing Metrics for Agency Business: Portfolio (basis points) (in years) Fannie Mae $ 13,195,643 52.3 7.7 Freddie Mac 3,977,619 30.8 11.0 FHA 621,419 15.7 20.1 Total $ 17,794,681 46.2 8.8 December 31, 2017 Fannie Mae $ 12,502,699 53.6 6.9 Freddie Mac 3,166,134 29.5 10.5 FHA 537,482 16.5 19.6 Total $ 16,206,315 47.7 8.1 |
Description of Business (Detail
Description of Business (Details) | 9 Months Ended |
Sep. 30, 2018segment | |
Description of Business | |
Number of business segments | 2 |
Basis of Presentation and Sig_4
Basis of Presentation and Significant Accounting Policies, Recently Adopted Accounting Pronouncements (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Recently Adopted Accounting Pronouncements | ||||
Proceeds from insurance settlements from net cash provided by operating activities | $ 493 | $ 493 | ||
Cash and cash equivalents at beginning of period | 104,374 | |||
Cash, cash equivalents and restricted cash at beginning of period | 243,772 | 167,960 | ||
Net increase in cash, cash equivalents and restricted cash | 51,562 | 53,930 | ||
Cash and cash equivalents at end of period | 92,598 | |||
Cash, cash equivalents and restricted cash at end of period | $ 221,890 | 295,334 | 221,890 | |
Net cash (used in) provided by operating activities: change in operating assets and liabilities | (96,468) | (6,368) | ||
Net cash used in investing activities | (550,216) | (350,348) | ||
Net cash used in financing activities | 797,314 | 16,840 | ||
Unrealized gains on available-for-sale securities into accumulated deficit | (235) | (353) | ||
Accumulated deficit | $ (78,316) | $ (101,926) | ||
Accounting Standards Update 2016-02 | ||||
Recently Adopted Accounting Pronouncements | ||||
Maximum percentage of total assets and total liabilities | 1.00% | |||
ASU 2016-15 | ||||
Recently Adopted Accounting Pronouncements | ||||
Proceeds from insurance settlements from net cash provided by operating activities | 500 | |||
Net cash used in investing activities | (500) | |||
Previously reported under GAAP | ||||
Recently Adopted Accounting Pronouncements | ||||
Cash and cash equivalents at beginning of period | 138,645 | |||
Net decrease in cash and cash equivalents | (53,894) | |||
Cash and cash equivalents at end of period | 84,751 | 84,751 | ||
Net cash (used in) provided by operating activities: change in operating assets and liabilities | (6,252) | |||
Net cash used in investing activities | (350,841) | |||
Net cash used in financing activities | (90,954) | |||
ASU 2016-18 and ASU 2016-15 | ||||
Recently Adopted Accounting Pronouncements | ||||
Cash, cash equivalents and restricted cash at beginning of period | 167,960 | |||
Net increase in cash, cash equivalents and restricted cash | 53,930 | |||
Cash, cash equivalents and restricted cash at end of period | $ 221,890 | 221,890 | ||
Net cash (used in) provided by operating activities: change in operating assets and liabilities | (6,368) | |||
Net cash used in investing activities | (350,348) | |||
Net cash used in financing activities | $ 16,840 | |||
ASU 2016-01 | ||||
Recently Adopted Accounting Pronouncements | ||||
Unrealized gains on available-for-sale securities into accumulated deficit | $ (200) | |||
Accumulated deficit | $ 200 |
Loans and Investments, Investme
Loans and Investments, Investment Portfolio and Concentration of Credit Risk (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2018USD ($)borrowerloan | Dec. 31, 2017USD ($)borrowerloan | Jun. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Loans and Investments | ||||||
Loans and investments, gross | $ 3,170,117 | $ 2,652,538 | ||||
Unearned revenue | (11,477) | (10,628) | ||||
Allowance for loan losses | (60,951) | (62,783) | $ (58,733) | $ (83,256) | $ (81,256) | $ (83,712) |
Loans and investments, net | $ 3,097,689 | $ 2,579,127 | ||||
Percent of Total | 100.00% | 100.00% | ||||
Loan Count | loan | 191 | 170 | ||||
Wtd. Avg. Pay Rate (as a percent) | 6.88% | 6.28% | ||||
Wtd. Avg. Remaining Months to Maturity | 22 months | 23 months 18 days | ||||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 4.00% | 4.00% | ||||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 74.00% | 73.00% | ||||
Number of loans and investments | loan | 8 | 8 | ||||
Higher-risk | ||||||
Loans and Investments | ||||||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 92.00% | 93.00% | ||||
Carrying value of loans | $ 128,700 | $ 126,500 | ||||
Total assets | Credit risk concentration | ||||||
Loans and Investments | ||||||
Loan Count | loan | 48 | 42 | ||||
Number of different borrowers | borrower | 5 | 5 | ||||
Concentration risk, percentage | 23.00% | 24.00% | ||||
Bridge loans | ||||||
Loans and Investments | ||||||
Loans and investments, gross | $ 2,919,582 | $ 2,422,105 | ||||
Percent of Total | 92.00% | 91.00% | ||||
Loan Count | loan | 170 | 150 | ||||
Wtd. Avg. Pay Rate (as a percent) | 6.70% | 6.10% | ||||
Wtd. Avg. Remaining Months to Maturity | 19 months 18 days | 20 months 27 days | ||||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 0.00% | 0.00% | ||||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 74.00% | 72.00% | ||||
Preferred equity investments | ||||||
Loans and Investments | ||||||
Loans and investments, gross | $ 154,202 | $ 142,892 | ||||
Percent of Total | 5.00% | 6.00% | ||||
Loan Count | loan | 10 | 12 | ||||
Wtd. Avg. Pay Rate (as a percent) | 8.18% | 6.47% | ||||
Wtd. Avg. Remaining Months to Maturity | 70 months 15 days | 68 months 21 days | ||||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 62.00% | 64.00% | ||||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 87.00% | 90.00% | ||||
Mezzanine loans | ||||||
Loans and Investments | ||||||
Loans and investments, gross | $ 96,333 | $ 87,541 | ||||
Percent of Total | 3.00% | 3.00% | ||||
Loan Count | loan | 11 | 8 | ||||
Wtd. Avg. Pay Rate (as a percent) | 10.49% | 10.78% | ||||
Wtd. Avg. Remaining Months to Maturity | 19 months 15 days | 24 months 24 days | ||||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 25.00% | 20.00% | ||||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 71.00% | 63.00% |
Loans and Investments, Risk Rat
Loans and Investments, Risk Ratings and LTV Ratios (Details) - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Loans and Investments | ||
Percentage of Portfolio | 100.00% | 100.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 4.00% | 4.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 74.00% | 73.00% |
Credit risk concentration | Pass/watch | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 3,170,117 | $ 2,652,538 |
Percentage of Portfolio | 100.00% | 100.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 4.00% | 4.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 74.00% | 73.00% |
Credit risk concentration | Loans and investments portfolio | New York | ||
Loans and Investments | ||
Concentration risk, percentage | 22.00% | 21.00% |
Credit risk concentration | Loans and investments portfolio | California | ||
Loans and Investments | ||
Concentration risk, percentage | 11.00% | |
Credit risk concentration | Loans and investments portfolio | Texas | ||
Loans and Investments | ||
Concentration risk, percentage | 19.00% | 23.00% |
Credit risk concentration | Multifamily | Pass/watch | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 2,378,771 | $ 1,925,529 |
Percentage of Portfolio | 75.00% | 73.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 4.00% | 4.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 74.00% | 72.00% |
Credit risk concentration | Self Storage | Pass | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 301,830 | |
Percentage of Portfolio | 11.00% | |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 0.00% | |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 71.00% | |
Credit risk concentration | Self Storage | Pass/watch | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 301,830 | |
Percentage of Portfolio | 10.00% | |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 0.00% | |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 72.00% | |
Credit risk concentration | Land | Substandard | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 151,628 | $ 132,828 |
Percentage of Portfolio | 5.00% | 5.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 0.00% | 0.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 84.00% | 90.00% |
Credit risk concentration | Office | Pass/watch | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 107,853 | |
Percentage of Portfolio | 4.00% | |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 1.00% | |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 64.00% | |
Credit risk concentration | Office | Special mention | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 127,055 | |
Percentage of Portfolio | 4.00% | |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 0.00% | |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 66.00% | |
Credit risk concentration | Healthcare | Pass/watch | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 107,775 | $ 55,615 |
Percentage of Portfolio | 3.00% | 2.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 0.00% | 0.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 81.00% | 74.00% |
Credit risk concentration | Hotel | Pass/watch | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 55,975 | |
Percentage of Portfolio | 2.00% | |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 23.00% | |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 74.00% | |
Credit risk concentration | Hotel | Special mention | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 90,725 | |
Percentage of Portfolio | 3.00% | |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 37.00% | |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 81.00% | |
Credit risk concentration | Retail | Pass/watch | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 45,383 | $ 36,458 |
Percentage of Portfolio | 1.00% | 1.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 7.00% | 8.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 66.00% | 66.00% |
Credit risk concentration | Commercial | Doubtful | ||
Loans and Investments | ||
Unpaid Principal Balance (UPB) | $ 1,700 | $ 1,700 |
Percentage of Portfolio | 1.00% | 1.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 63.00% | 63.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 63.00% | 63.00% |
Loans and Investments, Impaired
Loans and Investments, Impaired Loans and Allowance for Loan Losses (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Changes in allowance for loan losses | ||||
Allowance at beginning of period | $ 58,733 | $ 81,256 | $ 62,783 | $ 83,712 |
Provision for loan losses | 2,218 | 2,000 | 3,868 | 2,000 |
Recoveries of reserves | (2,527) | (2,456) | ||
Charge-offs | (3,173) | |||
Allowance at end of period | 60,951 | 83,256 | 60,951 | 83,256 |
Net carrying value of loans sold | $ 34,800 | 34,800 | ||
Mezzanine loans | ||||
Changes in allowance for loan losses | ||||
Recoveries of reserves | (1,800) | |||
Bridge loans | ||||
Changes in allowance for loan losses | ||||
Provision for loan losses | $ 1,700 | $ 1,700 | ||
Recoveries of reserves | $ (700) |
Loans and Investments, Charge-o
Loans and Investments, Charge-offs and Recoveries Narratives (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||||
Sep. 30, 2018USD ($)loan | Sep. 30, 2017USD ($)loan | Sep. 30, 2018USD ($)loan | Sep. 30, 2017USD ($)loan | Jun. 30, 2018USD ($) | Dec. 31, 2017USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Loans and Investments | ||||||||
Net carrying value of loans sold | $ 34,800 | $ 34,800 | ||||||
Proceeds from previously written-off loans and investments | $ 1,400 | $ 2,300 | ||||||
Number of loans for which no provision for loan loss made | loan | 0 | 0 | 0 | 0 | ||||
Charge-offs | $ 3,173 | |||||||
Provision for loan losses | $ 2,218 | $ 2,000 | 3,868 | $ 2,000 | ||||
Cumulative allowances for loan losses | 60,951 | $ 83,256 | 60,951 | 83,256 | $ 58,733 | $ 62,783 | $ 81,256 | $ 83,712 |
Recoveries of reserves | $ 2,527 | $ 2,456 | ||||||
Ratio of net recoveries (in percentage) | 0.10% | 0.10% | 0.10% | |||||
Mezzanine loans | ||||||||
Loans and Investments | ||||||||
Proceeds from Sale and Collection of Mortgage Notes Receivable | $ 1,800 | |||||||
Recoveries of reserves | 1,800 | |||||||
Bridge loans | ||||||||
Loans and Investments | ||||||||
Provision for loan losses | 1,700 | $ 1,700 | ||||||
Recoveries of reserves | $ 700 | |||||||
Six loans collateralized by a land development project | Maturity date of September 2018 | ||||||||
Loans and Investments | ||||||||
Unpaid principal balance on loans | 121,400 | 121,400 | ||||||
Provision for loan losses | $ 500 | $ 2,200 | ||||||
Number of loans with unpaid principal balance | loan | 6 | 6 | ||||||
Five loans collateralized by a land development project | Maturity date of September 2018 | ||||||||
Loans and Investments | ||||||||
Unpaid principal balance on loans | $ 112,000 | $ 112,000 | ||||||
Weighted average accrual rate of interest (as a percent) | 8.97% | |||||||
Cumulative allowances for loan losses | $ 51,200 | $ 51,200 | $ 49,100 | |||||
Number of loans with unpaid principal balance | loan | 5 | 5 | ||||||
Hotel | ||||||||
Loans and Investments | ||||||||
Proceed from payment for full satisfaction of a preferred equity investment | $ 31,600 | |||||||
Net carrying value of loans sold | 29,100 | |||||||
Charge-offs | 3,200 | |||||||
Unpaid principal balance on loans | $ 34,800 | 34,800 | ||||||
Recoveries of reserves | $ 2,500 |
Loans and Investments, Summary
Loans and Investments, Summary of impaired loans (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018USD ($)loan | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)loan | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($)loan | |
Loans and Investments | |||||
Unpaid Principal Balance (UPB) | $ 138,189 | $ 138,189 | $ 169,824 | ||
Carrying Value | 131,860 | 131,860 | 163,550 | ||
Allowance for Loan Losses | 60,951 | 60,951 | $ 62,783 | ||
Average Recorded Investment | 137,364 | $ 195,087 | 154,007 | $ 196,363 | |
Interest Income Recognized | $ 59 | 28 | $ 168 | 472 | |
Number of impaired loans | loan | 5 | 5 | 4 | ||
Land | |||||
Loans and Investments | |||||
Unpaid Principal Balance (UPB) | $ 134,215 | $ 134,215 | $ 131,086 | ||
Carrying Value | 127,886 | 127,886 | 124,812 | ||
Allowance for Loan Losses | 57,751 | 57,751 | 53,883 | ||
Average Recorded Investment | 133,387 | 131,086 | 132,651 | 131,086 | |
Interest Income Recognized | 26 | 75 | |||
Hotel | |||||
Loans and Investments | |||||
Unpaid Principal Balance (UPB) | 34,750 | ||||
Carrying Value | 34,750 | ||||
Allowance for Loan Losses | 5,700 | ||||
Average Recorded Investment | 34,750 | 17,375 | 34,750 | ||
Interest Income Recognized | 371 | ||||
Office | |||||
Loans and Investments | |||||
Unpaid Principal Balance (UPB) | 2,274 | 2,274 | 2,288 | ||
Carrying Value | 2,274 | 2,274 | 2,288 | ||
Allowance for Loan Losses | 1,500 | 1,500 | 1,500 | ||
Average Recorded Investment | 2,277 | 27,551 | 2,281 | 27,556 | |
Interest Income Recognized | 33 | 28 | 93 | 79 | |
Commercial | |||||
Loans and Investments | |||||
Unpaid Principal Balance (UPB) | 1,700 | 1,700 | 1,700 | ||
Carrying Value | 1,700 | 1,700 | 1,700 | ||
Allowance for Loan Losses | 1,700 | 1,700 | $ 1,700 | ||
Average Recorded Investment | $ 1,700 | $ 1,700 | $ 1,700 | 1,700 | |
Multifamily | |||||
Loans and Investments | |||||
Average Recorded Investment | 1,271 | ||||
Interest Income Recognized | $ 22 |
Loans and Investments, Non-perf
Loans and Investments, Non-performing Loans (Details) $ in Thousands | 9 Months Ended | 12 Months Ended | |
Sep. 30, 2018USD ($)loan | Dec. 31, 2017USD ($)loan | Sep. 30, 2017USD ($) | |
Non-performing loans by asset class | |||
Number of loans | loan | 191 | 170 | |
Carrying Value | $ 0 | $ 0 | |
Non-performing loans | |||
Non-performing loans by asset class | |||
Number of loans | loan | 2 | ||
Carrying value of loans | $ 800 | 29,100 | |
Loan loss reserves | 1,700 | 7,400 | |
Carrying Value | 2,531 | 36,450 | |
Greater Than 90 Days Past Due | |||
Non-performing loans by asset class | |||
Past Due, Non-performing Loans | 0 | 0 | |
Greater Than 90 Days Past Due | Non-performing loans | |||
Non-performing loans by asset class | |||
Past Due, Non-performing Loans | 2,531 | 36,450 | |
Commercial | Non-performing loans | |||
Non-performing loans by asset class | |||
Carrying Value | 1,700 | 1,700 | |
Commercial | Greater Than 90 Days Past Due | Non-performing loans | |||
Non-performing loans by asset class | |||
Past Due, Non-performing Loans | 1,700 | 1,700 | |
Hotel | |||
Non-performing loans by asset class | |||
Impaired Financing Receivable, Unpaid Principal Balance | 34,800 | ||
Hotel | Non-performing loans | |||
Non-performing loans by asset class | |||
Carrying Value | 34,750 | $ 34,800 | |
Hotel | Greater Than 90 Days Past Due | Non-performing loans | |||
Non-performing loans by asset class | |||
Past Due, Non-performing Loans | $ 34,750 | ||
Office | Non-performing loans | |||
Non-performing loans by asset class | |||
Carrying Value | 831 | ||
Office | Greater Than 90 Days Past Due | Non-performing loans | |||
Non-performing loans by asset class | |||
Past Due, Non-performing Loans | $ 831 |
Loans and Investments, Interest
Loans and Investments, Interest Reserves (Details) $ in Millions | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018USD ($)loan | Dec. 31, 2017USD ($)loan | |
Loans and Investments | ||
Interest reserve held | $ 41.3 | $ 52.5 |
Number of loans covered under interest reserve | loan | 98 | 81 |
Aggregate UPB covered under interest reserve | $ 2,010 | $ 1,570 |
Loans Held-for-Sale, Net (Detai
Loans Held-for-Sale, Net (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Loans Held-for-Sale, Net | |||||
Loans held-for-sale | $ 492,966 | $ 492,966 | $ 292,249 | ||
Fair value of future MSR | 8,459 | 8,459 | 5,806 | ||
Unearned discount | (1,144) | (1,144) | (612) | ||
Loans held-for-sale, net | 500,281 | $ 500,281 | 297,443 | ||
Maximum number of days held-for-sale loans are typically sold | 60 days | ||||
Loans with non-accrual status | 0 | $ 0 | 0 | ||
Sale of loans held-for-sale excluding acquired loans | 1,190,000 | $ 1,050,000 | 3,270,000 | $ 3,620,000 | |
Gain on sale of loans held-for-sale | 15,900 | $ 16,300 | 48,100 | $ 52,100 | |
Greater Than 90 Days Past Due | |||||
Loans Held-for-Sale, Net | |||||
Loans past due | 0 | 0 | 0 | ||
Fannie Mae | |||||
Loans Held-for-Sale, Net | |||||
Loans held-for-sale, net | 332,719 | 332,719 | 243,717 | ||
Freddie Mac | |||||
Loans Held-for-Sale, Net | |||||
Loans held-for-sale, net | 133,441 | 133,441 | 47,545 | ||
FHA | |||||
Loans Held-for-Sale, Net | |||||
Loans held-for-sale, net | $ 26,806 | $ 26,806 | $ 987 |
Capitalized Mortgage Servicin_3
Capitalized Mortgage Servicing Rights (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Capitalized Mortgage Servicing Rights | |||||
Balance at beginning of period | $ 252,608 | ||||
Balance at end of period | $ 259,401 | 259,401 | $ 252,608 | ||
Valuation allowance | 0 | 0 | 0 | ||
MSRs | |||||
Capitalized Mortgage Servicing Rights | |||||
Balance at beginning of period | 257,021 | $ 243,083 | 252,608 | $ 227,743 | 227,743 |
Additions | 21,368 | 20,720 | 59,660 | 66,273 | |
Amortization | (11,838) | (11,711) | (35,639) | (35,427) | |
Write-downs and payoffs | (7,150) | (4,216) | (17,228) | (10,713) | |
Balance at end of period | 259,401 | 247,876 | 259,401 | 247,876 | $ 252,608 |
Prepayment fees collected | 7,500 | 3,800 | 16,200 | 7,900 | |
Expected amortization of capitalized MSRs balances | |||||
2018 (three months ending 12/31/2018) | 12,000 | 12,000 | |||
2,019 | 45,946 | 45,946 | |||
2,020 | 41,383 | 41,383 | |||
2,021 | 34,919 | 34,919 | |||
2,022 | 28,357 | 28,357 | |||
2,023 | 23,850 | 23,850 | |||
Thereafter | 72,946 | 72,946 | |||
Finite-lived intangible assets, net | 259,401 | $ 259,401 | |||
MSRs | Minimum | |||||
Capitalized Mortgage Servicing Rights | |||||
Percentage of MSRs discount rate | 8.00% | ||||
MSRs | Maximum | |||||
Capitalized Mortgage Servicing Rights | |||||
Percentage of MSRs discount rate | 15.00% | ||||
MSRs | Weighted average | |||||
Capitalized Mortgage Servicing Rights | |||||
Percentage of MSRs discount rate | 12.00% | ||||
Estimated life remaining | 7 years 4 months 24 days | 7 years 2 months 12 days | |||
Acquired MSRs | |||||
Capitalized Mortgage Servicing Rights | |||||
Balance at beginning of period | 120,017 | 168,189 | $ 143,270 | 194,801 | $ 194,801 |
Amortization | (7,052) | (8,952) | (22,564) | (29,074) | |
Write-downs and payoffs | (4,419) | (4,194) | (12,160) | (10,684) | |
Balance at end of period | 108,546 | 155,043 | 108,546 | 155,043 | 143,270 |
Originated MSRs | |||||
Capitalized Mortgage Servicing Rights | |||||
Balance at beginning of period | 137,004 | 74,894 | 109,338 | 32,942 | 32,942 |
Additions | 21,368 | 20,720 | 59,660 | 66,273 | |
Amortization | (4,786) | (2,759) | (13,075) | (6,353) | |
Write-downs and payoffs | (2,731) | (22) | (5,068) | (29) | |
Balance at end of period | $ 150,855 | $ 92,833 | $ 150,855 | $ 92,833 | $ 109,338 |
Mortgage Servicing (Details)
Mortgage Servicing (Details) - MSRs - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Mortgage Servicing | |||||
Unpaid principal balance of loans serviced | $ 17,794,681 | $ 17,794,681 | $ 16,206,315 | ||
Weighted average servicing fee (as a percent) | 0.462% | 0.477% | |||
Interest earned on total escrows | 3,700 | $ 1,500 | $ 8,600 | $ 3,300 | |
Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 100.00% | 100.00% | |||
Escrow Deposit | 806,600 | $ 806,600 | $ 750,800 | ||
Fee-based servicing portfolio | Agency Business | |||||
Mortgage Servicing | |||||
Escrow Deposit | 567,300 | $ 567,300 | $ 477,900 | ||
Texas | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 21.00% | 22.00% | |||
North Carolina | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 10.00% | 10.00% | |||
California | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 8.00% | 8.00% | |||
New York | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 8.00% | 8.00% | |||
Georgia | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 6.00% | 6.00% | |||
Florida | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 6.00% | 6.00% | |||
Other | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 41.00% | 40.00% | |||
Fannie Mae | |||||
Mortgage Servicing | |||||
Unpaid principal balance of loans serviced | 13,195,643 | $ 13,195,643 | $ 12,502,699 | ||
Fannie Mae | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 74.00% | 77.00% | |||
Freddie Mac | |||||
Mortgage Servicing | |||||
Unpaid principal balance of loans serviced | 3,977,619 | $ 3,977,619 | $ 3,166,134 | ||
Freddie Mac | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 22.00% | 20.00% | |||
FHA | |||||
Mortgage Servicing | |||||
Unpaid principal balance of loans serviced | $ 621,419 | $ 621,419 | $ 537,482 | ||
FHA | Fee-based servicing portfolio | |||||
Mortgage Servicing | |||||
UPB Percentage of Total | 4.00% | 3.00% |
Securities Held-to-Maturity (De
Securities Held-to-Maturity (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)item | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | |
Held-to-Maturity | |||||
Carrying Value | $ 50,520 | $ 50,520 | $ 27,837 | ||
Held-to-Maturity | B Piece bonds | |||||
Held-to-Maturity | |||||
Weighted average variable interest rate (as a percent) | 3.63% | 3.63% | |||
Estimated weighted average maturity period | 5 years 8 months 12 days | ||||
Weighted average effective interest rate (as a percent) | 11.32% | 11.32% | 12.97% | ||
Face Value | $ 70,518 | $ 40,566 | |||
Carrying Value | $ 50,520 | 50,520 | 27,837 | ||
Unrealized Gain | 1,792 | 1,792 | 602 | ||
Estimated Fair Value | 52,312 | 52,312 | $ 28,439 | ||
Impairment charges | 0 | ||||
Interest income | 600 | $ 500 | 1,700 | $ 900 | |
Held-to-maturity securities, estimated fiscal year | |||||
Within one year | 10,700 | 10,700 | |||
After one year through five years | 30,600 | 30,600 | |||
After five years through ten years | 20,000 | 20,000 | |||
After ten years | $ 9,200 | 9,200 | |||
Held-to-Maturity | Two B Piece bonds | |||||
Held-to-Maturity | |||||
Initial face value of bonds purchased | 31,200 | ||||
Discounted value of bonds purchased | $ 21,600 | ||||
Number of B Piece bonds | item | 2 | ||||
Held-to-Maturity | Five B Piece bonds | |||||
Held-to-Maturity | |||||
Discounted value of bonds purchased | $ 48,800 | ||||
B Piece retained percentage | 49.00% | ||||
Number of B Piece bonds | item | 5 | ||||
Remaining of B Piece bond sold to the third party at par | 51.00% | 51.00% |
Investments in Equity Affilia_3
Investments in Equity Affiliates, Summary (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | $ 22,101 | $ 23,653 |
UPB of Loans to Equity Affiliates | 282,188 | |
Arbor Residential Investor LLC | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 19,781 | 19,193 |
Lightstone Value Plus REIT L.P | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 1,895 | 1,895 |
JT Prime | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 425 | 425 |
West Shore Cafe | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | $ 2,140 | |
UPB of Loans to Equity Affiliates | 1,688 | |
Lexford Portfolio | ||
Investment in Equity Affiliates | ||
UPB of Loans to Equity Affiliates | $ 280,500 |
Investments in Equity Affilia_4
Investments in Equity Affiliates, Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||||
Sep. 30, 2018 | Mar. 31, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2016 | |
Investment in Equity Affiliates | ||||||
(Loss) income from equity affiliates | $ (1,028) | $ 996 | $ 1,104 | $ 1,756 | ||
Loan to an affiliated entity | 282,188 | 282,188 | ||||
Provision for loan losses | 2,218 | 2,000 | 3,868 | 2,000 | ||
Arbor Residential Investor LLC | Non-qualified Residential Mortgages | ||||||
Investment in Equity Affiliates | ||||||
Distributions from equity affiliates | 700 | 900 | ||||
Arbor Residential Investor LLC | Residential Mortgage Banking Company | ||||||
Investment in Equity Affiliates | ||||||
(Loss) income from equity affiliates | 400 | (1,300) | 1,200 | (1,900) | ||
Charge for proportionate share of litigation settlement recorded | $ 2,400 | |||||
West Shore Cafe | ||||||
Investment in Equity Affiliates | ||||||
Loan to an affiliated entity | $ 1,688 | $ 1,688 | ||||
Ownership interest (as a percent) | 50.00% | 50.00% | ||||
West Shore Cafe | First mortgage | ||||||
Investment in Equity Affiliates | ||||||
(Loss) income from equity affiliates | $ 2,200 | |||||
Loan to an affiliated entity | 1,700 | $ 1,700 | ||||
Provision for loan losses | 1,700 | |||||
West Shore Cafe | First mortgage | LIBOR | ||||||
Investment in Equity Affiliates | ||||||
Variable rate, spread (as a percent) | 4.00% | |||||
Lexford Portfolio | ||||||
Investment in Equity Affiliates | ||||||
Loan to an affiliated entity | 280,500 | $ 280,500 | ||||
Distribution received | $ 700 | 700 | $ 1,900 | $ 2,000 | ||
Equity participation interest held in a multifamily property | ||||||
Investment in Equity Affiliates | ||||||
Distributions from equity affiliates | $ 1,500 | |||||
Ownership interest (as a percent) | 25.00% | 25.00% | ||||
Basis of equity participation interest | $ 0 |
Real Estate Owned, Portfolio (D
Real Estate Owned, Portfolio (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Real Estate Owned | ||||
Real estate owned, net | $ 14,563,000 | $ 14,563,000 | $ 16,787,000 | |
Impairment loss on real estate owned | 2,000,000 | $ 2,700,000 | ||
Restricted cash due to escrow requirement | 202,736,000 | 202,736,000 | 139,398,000 | |
Real Estate Owned | ||||
Real Estate Owned | ||||
Less: Impairment loss | (15,807,000) | (15,807,000) | (13,807,000) | |
Less: Accumulated depreciation and amortization | (10,451,000) | (10,451,000) | (9,918,000) | |
Real estate owned, net | 14,563,000 | 14,563,000 | 16,787,000 | |
Restricted cash due to escrow requirement | 800,000 | 800,000 | 700,000 | |
Real Estate Owned | Hotel | ||||
Real Estate Owned | ||||
Less: Impairment loss | (13,307,000) | (13,307,000) | (13,307,000) | |
Less: Accumulated depreciation and amortization | (9,642,000) | (9,642,000) | (9,228,000) | |
Real estate owned, net | $ 11,353,000 | $ 11,353,000 | 11,458,000 | |
Weighted average occupancy rate of properties (as a percent) | 54.00% | 54.00% | 55.00% | |
Amount of weighted average daily rate of properties | $ 113 | $ 113 | ||
Amount of weighted average daily revenue of properties | 61 | 62 | ||
Impairment loss on real estate owned | $ 2,700,000 | |||
Real Estate Owned | Office | ||||
Real Estate Owned | ||||
Less: Impairment loss | $ (2,500,000) | (2,500,000) | (500,000) | |
Less: Accumulated depreciation and amortization | (809,000) | (809,000) | (690,000) | |
Real estate owned, net | 3,210,000 | 3,210,000 | 5,329,000 | |
Impairment loss on real estate owned | 2,000,000 | 2,000,000 | ||
Real Estate Owned | Land | ||||
Real Estate Owned | ||||
Real estate owned, gross | 7,803,000 | 7,803,000 | 7,803,000 | |
Real Estate Owned | Land | Hotel | ||||
Real Estate Owned | ||||
Real estate owned, gross | 3,294,000 | 3,294,000 | 3,294,000 | |
Real Estate Owned | Land | Office | ||||
Real Estate Owned | ||||
Real estate owned, gross | 4,509,000 | 4,509,000 | 4,509,000 | |
Real Estate Owned | Building and intangible assets | ||||
Real Estate Owned | ||||
Real estate owned, gross | 33,018,000 | 33,018,000 | 32,709,000 | |
Real Estate Owned | Building and intangible assets | Hotel | ||||
Real Estate Owned | ||||
Real estate owned, gross | 31,008,000 | 31,008,000 | 30,699,000 | |
Real Estate Owned | Building and intangible assets | Office | ||||
Real Estate Owned | ||||
Real estate owned, gross | $ 2,010,000 | $ 2,010,000 | $ 2,010,000 |
Debt Obligations, Credit Facili
Debt Obligations, Credit Facilities and Repurchase Agreements (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 7 Months Ended | 9 Months Ended | 12 Months Ended | |||||||
Sep. 30, 2018 | Aug. 31, 2018 | Jun. 30, 2018 | Apr. 30, 2018 | Mar. 31, 2018 | Feb. 28, 2018 | Jan. 31, 2018 | Mar. 31, 2018 | Jul. 31, 2018 | Sep. 30, 2018 | Dec. 31, 2017 | Jan. 31, 2019 | |
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 1,169,586 | $ 1,169,586 | $ 528,573 | |||||||||
Collateral Carrying Value | $ 1,315,119 | $ 1,315,119 | $ 533,584 | |||||||||
Weighted Average Note Rate (as a percent) | 4.10% | 4.10% | 3.34% | |||||||||
$17.4 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 12,405 | $ 12,405 | ||||||||||
Collateral Carrying Value | $ 15,844 | $ 15,844 | ||||||||||
Weighted Average Note Rate (as a percent) | 4.73% | 4.73% | ||||||||||
Variable rate, spread (as a percent) | 2.40% | |||||||||||
$8 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 7,941 | $ 7,941 | ||||||||||
Collateral Carrying Value | $ 10,000 | $ 10,000 | ||||||||||
Weighted Average Note Rate (as a percent) | 4.83% | 4.83% | ||||||||||
Variable rate, spread (as a percent) | 2.50% | |||||||||||
Structured Business | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 676,983 | $ 676,983 | $ 237,037 | |||||||||
Collateral Carrying Value | $ 822,320 | $ 822,320 | $ 241,868 | |||||||||
Weighted Average Note Rate (as a percent) | 4.53% | 4.53% | 4.02% | |||||||||
Weighted average note rate including certain fees and costs (as a percent) | 4.86% | 4.86% | 4.51% | |||||||||
Unamortized deferred finance costs | $ 2,600 | $ 2,600 | $ 2,200 | |||||||||
Leverage on loans and investment portfolio, excluding the $3.0 million and $2.2 million master security agreement used to finance leasehold and capital expenditure improvements to corporate office (as a percent) | 70.00% | 70.00% | 72.00% | |||||||||
Maximum borrowing capacity | $ 2,200 | $ 2,200 | ||||||||||
Fixed interest rate (as a percent) | 4.60% | 4.60% | ||||||||||
Structured Business | $375 million repurchase facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 334,582 | $ 334,582 | $ 102,350 | |||||||||
Collateral Carrying Value | $ 470,650 | $ 470,650 | $ 145,850 | |||||||||
Weighted Average Note Rate (as a percent) | 4.53% | 4.53% | 3.90% | |||||||||
Maximum borrowing capacity | $ 375,000 | $ 375,000 | $ 375,000 | $ 375,000 | ||||||||
Additional borrowing capacity | 75,000 | |||||||||||
Structured Business | $375 million repurchase facility | Minimum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 1.75% | |||||||||||
Structured Business | $375 million repurchase facility | Maximum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 3.50% | |||||||||||
Structured Business | $100 million repurchase facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 94,024 | $ 94,024 | 2,445 | |||||||||
Collateral Carrying Value | $ 132,107 | $ 132,107 | $ 6,600 | |||||||||
Weighted Average Note Rate (as a percent) | 4.09% | 4.09% | 3.61% | |||||||||
Variable rate, spread (as a percent) | 2.00% | |||||||||||
Maximum borrowing capacity | $ 100,000 | $ 100,000 | $ 100,000 | |||||||||
Structured Business | $100 million repurchase facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.00% | 1.75% | ||||||||||
Structured Business | $100 million repurchase facility | Minimum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 1.75% | |||||||||||
Structured Business | $100 million repurchase facility | Maximum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.00% | |||||||||||
Structured Business | $75 million credit facility - One | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 20,355 | $ 20,355 | ||||||||||
Collateral Carrying Value | $ 30,469 | $ 30,469 | ||||||||||
Weighted Average Note Rate (as a percent) | 4.07% | 4.07% | ||||||||||
Maximum borrowing capacity | $ 75,000 | $ 75,000 | 75,000 | |||||||||
Structured Business | $75 million credit facility - One | Minimum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 1.75% | 2.00% | 1.75% | |||||||||
Structured Business | $75 million credit facility - One | Maximum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.50% | 2.50% | 2.50% | |||||||||
Structured Business | $75 million credit facility - two | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 14,482 | $ 14,482 | 8,999 | |||||||||
Collateral Carrying Value | $ 21,000 | $ 21,000 | $ 16,000 | |||||||||
Weighted Average Note Rate (as a percent) | 4.32% | 4.32% | 3.61% | |||||||||
Maximum borrowing capacity | $ 75,000 | $ 75,000 | $ 75,000 | |||||||||
Structured Business | $75 million credit facility - two | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.00% | |||||||||||
Structured Business | $50 million credit facility - one | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 28,557 | $ 28,557 | 32,538 | |||||||||
Collateral Carrying Value | $ 35,700 | $ 35,700 | $ 40,700 | |||||||||
Weighted Average Note Rate (as a percent) | 4.32% | 4.32% | 3.61% | |||||||||
Maximum borrowing capacity | $ 50,000 | $ 50,000 | $ 50,000 | |||||||||
Structured Business | $50 million credit facility - one | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.00% | |||||||||||
Structured Business | $50 million credit facility - two | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 3,581 | |||||||||||
Collateral Carrying Value | $ 4,625 | |||||||||||
Weighted Average Note Rate (as a percent) | 4.88% | |||||||||||
Maximum borrowing capacity | 50,000 | $ 50,000 | $ 50,000 | |||||||||
Structured Business | $50 million credit facility - two | Minimum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.50% | |||||||||||
Structured Business | $50 million credit facility - two | Maximum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 3.25% | |||||||||||
Structured Business | $25.5 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 15,773 | $ 15,773 | 13,920 | |||||||||
Collateral Carrying Value | $ 34,000 | $ 34,000 | $ 18,753 | |||||||||
Weighted Average Note Rate (as a percent) | 4.83% | 4.83% | 4.12% | |||||||||
Maximum borrowing capacity | $ 25,500 | $ 25,500 | ||||||||||
Structured Business | $25.5 million credit facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.50% | |||||||||||
Structured Business | $25 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 10,000 | |||||||||||
Weighted Average Note Rate (as a percent) | 4.12% | |||||||||||
Maximum borrowing capacity | 25,000 | $ 10,000 | $ 10,000 | $ 25,000 | ||||||||
Additional borrowing capacity | $ 15,000 | |||||||||||
Structured Business | $25 million credit facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.25% | |||||||||||
Decrease in interest rate (as a percent) | 0.25% | |||||||||||
Structured Business | $23.2 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 23,068 | $ 23,068 | ||||||||||
Collateral Carrying Value | $ 30,900 | $ 30,900 | ||||||||||
Weighted Average Note Rate (as a percent) | 4.62% | 4.62% | ||||||||||
Maximum borrowing capacity | $ 23,200 | $ 23,200 | $ 23,200 | $ 23,200 | ||||||||
Extension of maturity date (in years) | 1 year | |||||||||||
Structured Business | $23.2 million credit facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.30% | 2.30% | ||||||||||
Structured Business | $20.0 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 19,904 | $ 19,904 | ||||||||||
Collateral Carrying Value | $ 41,650 | $ 41,650 | ||||||||||
Weighted Average Note Rate (as a percent) | 4.83% | 4.83% | ||||||||||
Variable rate, spread (as a percent) | 2.50% | |||||||||||
Maximum borrowing capacity | $ 20,000 | $ 20,000 | 20,000 | |||||||||
Structured Business | $20.0 million credit facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.50% | |||||||||||
Structured Business | $17.4 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Maximum borrowing capacity | 17,400 | $ 17,400 | $ 17,400 | 17,400 | ||||||||
Structured Business | $17.4 million credit facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.40% | |||||||||||
Structured Business | $8 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Maximum borrowing capacity | $ 8,000 | 8,000 | 8,000 | |||||||||
Structured Business | $8 million credit facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.50% | |||||||||||
Structured Business | $7.5 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 7,432 | |||||||||||
Collateral Carrying Value | $ 9,340 | |||||||||||
Weighted Average Note Rate (as a percent) | 4.37% | |||||||||||
Maximum borrowing capacity | $ 7,500 | $ 7,500 | $ 7,500 | |||||||||
Structured Business | $7.5 million credit facility | Minimum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.75% | |||||||||||
Structured Business | Repurchase facility - securities | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 102,701 | $ 102,701 | $ 53,938 | |||||||||
Weighted Average Note Rate (as a percent) | 4.97% | 4.97% | 4.45% | |||||||||
Structured Business | Repurchase facility - securities | Minimum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.35% | |||||||||||
Structured Business | Repurchase facility - securities | Maximum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 3.25% | |||||||||||
Structured Business | $3 million master security agreement | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 1,337 | $ 1,337 | $ 1,834 | |||||||||
Weighted Average Note Rate (as a percent) | 3.20% | 3.20% | 3.21% | |||||||||
Maximum borrowing capacity | $ 3,000 | $ 3,000 | $ 3,000 | |||||||||
Structured Business | $3 million master security agreement | Minimum | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 2.96% | |||||||||||
Structured Business | $3 million master security agreement | Maximum | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 3.42% | |||||||||||
Structured Business | $2.2 million master security agreement | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | $ 1,854 | $ 1,854 | ||||||||||
Weighted Average Note Rate (as a percent) | 4.66% | 4.66% | ||||||||||
Variable rate, spread (as a percent) | 4.60% | |||||||||||
Maximum borrowing capacity | $ 2,200 | $ 2,200 | 2,200 | |||||||||
Structured Business | $225 million repurchase facility | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 0.50% | |||||||||||
Maximum borrowing capacity | $ 300,000 | 300,000 | 225,000 | |||||||||
Additional borrowing capacity | $ 75,000 | $ 75,000 | ||||||||||
Agency Business | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 492,603 | 492,603 | 291,536 | |||||||||
Collateral Carrying Value | $ 492,799 | $ 492,799 | $ 291,716 | |||||||||
Weighted Average Note Rate (as a percent) | 3.50% | 3.50% | 2.78% | |||||||||
Unamortized deferred finance costs | $ 200 | $ 200 | $ 200 | |||||||||
Agency Business | $500 million multifamily ASAP agreement | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 96,617 | 96,617 | 121,880 | |||||||||
Collateral Carrying Value | $ 96,617 | $ 96,617 | $ 121,880 | |||||||||
Weighted Average Note Rate (as a percent) | 3.31% | 3.31% | 2.61% | |||||||||
Maximum borrowing capacity | $ 500,000 | $ 500,000 | $ 500,000 | |||||||||
Agency Business | $500 million multifamily ASAP agreement | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 1.05% | |||||||||||
Agency Business | $500 million multifamily ASAP agreement | Minimum | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 0.35% | 0.35% | ||||||||||
Agency Business | $250 million credit facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 102,180 | $ 102,180 | $ 23,785 | |||||||||
Collateral Carrying Value | $ 102,182 | $ 102,182 | $ 23,785 | |||||||||
Weighted Average Note Rate (as a percent) | 3.51% | 3.51% | 2.86% | |||||||||
Variable rate, spread (as a percent) | 1.25% | |||||||||||
Maximum borrowing capacity | $ 250,000 | $ 250,000 | $ 250,000 | $ 250,000 | ||||||||
Agency Business | $200 million repurchase facility | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 73,573 | 73,573 | 24,827 | |||||||||
Collateral Carrying Value | $ 73,573 | $ 73,573 | $ 24,873 | |||||||||
Weighted Average Note Rate (as a percent) | 3.54% | 3.54% | 2.91% | |||||||||
Maximum borrowing capacity | $ 200,000 | $ 200,000 | $ 100,000 | $ 200,000 | $ 200,000 | |||||||
Additional borrowing capacity | $ 100,000 | |||||||||||
Agency Business | $200 million repurchase facility | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 1.275% | 1.35% | 1.275% | |||||||||
Agency Business | $150 million credit facility - one | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 136,567 | $ 136,567 | 21,802 | |||||||||
Collateral Carrying Value | $ 136,644 | $ 136,644 | $ 21,821 | |||||||||
Weighted Average Note Rate (as a percent) | 3.56% | 3.56% | 2.96% | |||||||||
Maximum borrowing capacity | $ 150,000 | $ 150,000 | $ 150,000 | $ 150,000 | $ 150,000 | |||||||
Decrease in interest rate (as a percent) | (0.05%) | (0.10%) | ||||||||||
Agency Business | $150 million credit facility - one | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 1.30% | 1.35% | 1.30% | |||||||||
Agency Business | $150 million credit facility - two | ||||||||||||
Debt Obligations | ||||||||||||
Debt Carrying Value | 83,666 | $ 83,666 | 99,242 | |||||||||
Collateral Carrying Value | $ 83,783 | $ 83,783 | $ 99,357 | |||||||||
Weighted Average Note Rate (as a percent) | 3.56% | 3.56% | 2.91% | |||||||||
Maximum borrowing capacity | $ 150,000 | $ 150,000 | $ 150,000 | |||||||||
Agency Business | $150 million credit facility - two | LIBOR | ||||||||||||
Debt Obligations | ||||||||||||
Variable rate, spread (as a percent) | 1.30% | |||||||||||
Agency Business | Letter of credit | Fannie Mae | ||||||||||||
Debt Obligations | ||||||||||||
Additional borrowing capacity | $ 2,000 | |||||||||||
Outstanding letters of credit | $ 44,000 | |||||||||||
Agency Business | Letter of credit | Freddie Mac | ||||||||||||
Debt Obligations | ||||||||||||
Outstanding letters of credit | 5,000 | $ 5,000 | ||||||||||
CLOs | Repurchase facility - securities | ||||||||||||
Debt Obligations | ||||||||||||
Collateral Carrying Value | 114,200 | 114,200 | 61,000 | |||||||||
B Piece bonds | Repurchase facility - securities | ||||||||||||
Debt Obligations | ||||||||||||
Collateral Carrying Value | $ 50,500 | $ 50,500 | $ 27,800 |
Debt Obligations, Collateralize
Debt Obligations, Collateralized Loan Obligations (Details) $ in Thousands | Oct. 01, 2018USD ($) | Jun. 30, 2018USD ($)itemtranche | Sep. 30, 2018USD ($) | Sep. 30, 2017USD ($) | Mar. 31, 2018USD ($) | Dec. 31, 2017USD ($) |
Debt Obligations | ||||||
Debt, Carrying Value | $ 1,592,089 | $ 1,418,422 | ||||
Weighted average note rate (as a percent) | 4.10% | 3.34% | ||||
Proceeds from issuance of collateralized loan obligations | $ 441,000 | $ 561,874 | ||||
CLOs | ||||||
Debt Obligations | ||||||
Debt, Face Value | 1,609,524 | $ 1,436,274 | ||||
Debt, Carrying Value | $ 1,592,089 | $ 1,418,422 | ||||
Weighted average note rate (as a percent) | 3.98% | 3.48% | ||||
Collateral Loans, Unpaid Principal | $ 1,792,687 | $ 1,745,891 | ||||
Collateral Loans, Carrying Value | 1,786,843 | 1,740,180 | ||||
Cash collateral | 169,579 | 115,109 | ||||
Deferred financing fees | $ 17,400 | $ 17,900 | ||||
Weighted average note rate including certain fees and costs (as a percent) | 4.49% | 4.08% | ||||
Collateral at risk | $ 0 | $ 0 | ||||
CLO X | ||||||
Debt Obligations | ||||||
Number of tranches of CLO notes issued | tranche | 7 | |||||
Number of newly-formed wholly-owned subsidiaries | item | 2 | |||||
Value of the seven tranches issued | $ 494,200 | |||||
Value of portfolio loans as collateral | $ 501,900 | |||||
Debt, Face Value | $ 441,000 | |||||
Debt, Carrying Value | $ 436,132 | |||||
Weighted average note rate (as a percent) | 3.76% | |||||
Collateral Loans, Unpaid Principal | $ 510,303 | |||||
Collateral Loans, Carrying Value | 508,357 | |||||
Cash collateral | 42,032 | |||||
Replacement period | 4 years | |||||
Proceeds from issuance of collateralized loan obligations | $ 58,100 | |||||
Notional amount of residual interest retained | 119,000 | |||||
CLO X | Period of up to 120 days from the CLO closing date | ||||||
Debt Obligations | ||||||
Value of portfolio loans as collateral | $ 560,000 | |||||
Maximum period to acquire additional loan obligations | 120 days | |||||
Leverage (as a percent) | 79.00% | |||||
CLO X | Investment grade | ||||||
Debt Obligations | ||||||
Debt, Face Value | 441,000 | |||||
CLO X | Below investment grade | ||||||
Debt Obligations | ||||||
Debt, Face Value | 53,200 | |||||
Notional amount of residual interest retained | $ 53,200 | |||||
CLO X | Secured Debt | One-month LIBOR | ||||||
Debt Obligations | ||||||
Weighted average note rate (as a percent) | 1.45% | |||||
CLO IX | ||||||
Debt Obligations | ||||||
Debt, Face Value | 356,400 | 356,400 | ||||
Debt, Carrying Value | $ 351,934 | $ 351,042 | ||||
Weighted average note rate (as a percent) | 3.67% | 2.97% | ||||
Collateral Loans, Unpaid Principal | $ 417,089 | $ 372,350 | ||||
Collateral Loans, Carrying Value | 415,776 | 371,236 | ||||
Cash collateral | 3,911 | 88,650 | ||||
CLO VIII | ||||||
Debt Obligations | ||||||
Debt, Face Value | 282,874 | 282,874 | ||||
Debt, Carrying Value | $ 279,538 | $ 278,606 | ||||
Weighted average note rate (as a percent) | 3.62% | 2.92% | ||||
Collateral Loans, Unpaid Principal | $ 304,078 | $ 364,838 | ||||
Collateral Loans, Carrying Value | 303,302 | 363,339 | ||||
Cash collateral | 39,409 | 162 | ||||
CLO VII | ||||||
Debt Obligations | ||||||
Debt, Face Value | 279,000 | 279,000 | ||||
Debt, Carrying Value | $ 276,221 | $ 275,331 | ||||
Weighted average note rate (as a percent) | 4.31% | 3.61% | ||||
Collateral Loans, Unpaid Principal | $ 285,134 | $ 346,524 | ||||
Collateral Loans, Carrying Value | 284,322 | 345,220 | ||||
Cash collateral | 43,885 | 13,476 | ||||
CLO VI | ||||||
Debt Obligations | ||||||
Debt, Face Value | 250,250 | 250,250 | ||||
Debt, Carrying Value | $ 248,264 | $ 247,470 | ||||
Weighted average note rate (as a percent) | 4.81% | 4.10% | ||||
Collateral Loans, Unpaid Principal | $ 276,083 | $ 314,382 | ||||
Collateral Loans, Carrying Value | 275,086 | 313,582 | ||||
Cash collateral | $ 40,342 | 10,618 | ||||
CLO V | ||||||
Debt Obligations | ||||||
Debt, Face Value | 267,750 | |||||
Debt, Carrying Value | $ 265,973 | |||||
Weighted average note rate (as a percent) | 4.06% | |||||
Collateral Loans, Unpaid Principal | $ 347,797 | |||||
Collateral Loans, Carrying Value | 346,803 | |||||
Cash collateral | $ 2,203 | |||||
Debt Instrument Redemption Value | $ 267,800 | |||||
Deferred fees expensed as interest expense | $ 1,300 |
Debt Obligations, Luxembourg De
Debt Obligations, Luxembourg Debt Fund (Details) - USD ($) $ in Thousands | 1 Months Ended | |||
Nov. 30, 2017 | Sep. 30, 2018 | Mar. 31, 2018 | Dec. 31, 2017 | |
Debt Obligations | ||||
Debt, Carrying Value | $ 1,592,089 | $ 1,418,422 | ||
Weighted Average Note Rate (as a percent) | 4.10% | 3.34% | ||
Luxembourg debt fund | ||||
Debt Obligations | ||||
Value of portfolio loans as collateral | $ 100,000 | |||
Debt, Face Value | $ 70,000 | $ 70,000 | $ 70,000 | |
Debt, Carrying Value | $ 68,099 | $ 68,084 | ||
Weighted Average Note Rate (as a percent) | 6.50% | 5.79% | ||
Collateral Loans, UPB | $ 98,696 | $ 96,995 | ||
Collateral Loans, Carrying Value | 98,261 | 96,564 | ||
Cash collateral | 3,005 | |||
Deferred financing fees | $ 1,900 | $ 1,900 | ||
Weighted average note rate including certain fees and costs (as a percent) | 7.08% | 6.05% | ||
Collateral at risk | $ 0 | $ 0 | ||
One-month LIBOR | Luxembourg debt fund | ||||
Debt Obligations | ||||
Variable rate, spread (as a percent) | 4.15% | |||
Luxembourg commercial real estate debt fund | ||||
Debt Obligations | ||||
Equity formed | $ 100,000 | |||
Equity interest retained | $ 30,000 | |||
Reinvested period allowed | 3 years |
Debt Obligations, Senior Unsecu
Debt Obligations, Senior Unsecured Notes (Details) - USD ($) $ in Thousands | 1 Months Ended | |||
Mar. 31, 2018 | Sep. 30, 2018 | May 31, 2018 | Dec. 31, 2017 | |
Debt Obligations | ||||
Senior notes carrying value | $ 122,358 | $ 95,280 | ||
5.625% Notes | ||||
Debt Obligations | ||||
Principal amount | $ 125,000 | |||
Additional principal amount | $ 100,000 | $ 25,000 | ||
Interest rate (as a percent) | 5.625% | |||
Net proceeds | $ 122,300 | |||
Redemption of aggregate principal amount (as a percent) | 100.00% | |||
Senior notes carrying value | 122,400 | |||
Deferred financing fees | $ 2,600 | |||
Weighted average note rate including certain fees and costs (as a percent) | 6.08% | |||
5.375% Convertible Notes | ||||
Debt Obligations | ||||
Interest rate (as a percent) | 7.375% | |||
Debt instrument redemption value | $ 97,900 | |||
Senior notes carrying value | 95,300 | |||
Deferred financing fees | $ 2,600 | |||
Weighted average note rate including certain fees and costs (as a percent) | 8.16% |
Debt Obligations, Convertible S
Debt Obligations, Convertible Senior Unsecured Notes (Details) $ / shares in Units, $ in Thousands, shares in Millions | Jul. 20, 2018USD ($)$ / shares | Jul. 03, 2018USD ($)$ / shares | Sep. 30, 2018USD ($)$ / shares | Nov. 30, 2017$ / shares | Sep. 30, 2018USD ($)$ / sharesshares | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)$ / shares | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | Dec. 31, 2016$ / shares | Jul. 31, 2018 |
Debt Obligations | |||||||||||
Cash paid for the exchange of convertible notes | $ 219,922 | ||||||||||
(Loss) gain on extinguishment of debt | $ (4,960) | (4,960) | $ 7,116 | ||||||||
Convertible Senior Unsecured Notes | |||||||||||
Debt Obligations | |||||||||||
Principal amount | $ 280,816 | 280,816 | $ 280,816 | $ 243,750 | |||||||
Proceeds received, net of estimated issuance costs | 34,500 | ||||||||||
Percentage of the Notes required to be repurchased if the agreement is fundamentally changed | 100.00% | ||||||||||
Maturity period (in years) | 2 years 8 months 19 days | 2 years 4 months 28 days | |||||||||
Unamortized Debt Discount | 9,285 | 9,285 | $ 9,285 | $ 5,742 | |||||||
Unamortized Deferred Financing Fees | 7,878 | 7,878 | 7,878 | 6,721 | |||||||
Net Carrying Value, Liability Component | $ 263,653 | 263,653 | 263,653 | 231,287 | |||||||
Net Carrying Value, Equity Component | 9,436 | $ 6,733 | |||||||||
Total interest expense | 5,000 | $ 2,200 | 16,000 | 6,600 | |||||||
Interest expense related to cash coupon | 3,100 | 1,600 | 9,900 | 4,800 | |||||||
Deferred fees expensed as interest expense | 1,000 | 400 | 4,100 | 1,100 | |||||||
Debt discount | $ 900 | $ 200 | $ 2,000 | $ 700 | |||||||
Cost of the notes (as a percent) | 7.45% | 7.45% | 7.45% | 7.45% | 7.45% | ||||||
5.375% Convertible Notes | |||||||||||
Debt Obligations | |||||||||||
Principal amount | $ 16,200 | $ 16,200 | $ 16,200 | ||||||||
Interest rate (as a percent) | 5.375% | 5.375% | 5.375% | 5.375% | |||||||
Cash paid for the exchange of convertible notes | $ 127,600 | ||||||||||
Conversion rate of the notes to common stock, per $1,000 principal amount of notes | 109.2211 | 107.7122 | |||||||||
Conversion price per share of common stock | $ / shares | $ 9.16 | $ 9.28 | $ 9.16 | $ 9.16 | |||||||
6.50% Convertible Notes | |||||||||||
Debt Obligations | |||||||||||
Additional principal amount | $ 200 | $ 200 | $ 200 | ||||||||
Interest rate (as a percent) | 6.50% | 6.50% | 6.50% | 6.50% | |||||||
Cash paid for the exchange of convertible notes | $ 99,800 | ||||||||||
Conversion rate of the notes to common stock, per $1,000 principal amount of notes | 123.2929 | 119.3033 | |||||||||
Conversion price per share of common stock | $ / shares | $ 8.11 | $ 8.11 | $ 8.11 | $ 8.38 | |||||||
5.25% Convertible Notes | |||||||||||
Debt Obligations | |||||||||||
Principal amount | $ 264,500 | $ 264,500 | $ 264,500 | ||||||||
Interest rate (as a percent) | 5.25% | 5.25% | 5.25% | ||||||||
Proceeds received, net of estimated issuance costs | $ 256,100 | ||||||||||
5.25% Convertible Notes | First Offering | |||||||||||
Debt Obligations | |||||||||||
Principal amount | $ 115,000 | ||||||||||
Conversion rate of the notes to common stock, per $1,000 principal amount of notes | 86.9943 | ||||||||||
Conversion price per share of common stock | $ / shares | $ 11.50 | ||||||||||
5.25% Convertible Notes | Second Offering | |||||||||||
Debt Obligations | |||||||||||
Principal amount | $ 149,500 | ||||||||||
Conversion rate of the notes to common stock, per $1,000 principal amount of notes | 77.8331 | ||||||||||
Conversion price per share of common stock | $ / shares | $ 12.85 | ||||||||||
5.375% and 6.50% Convertible Notes | |||||||||||
Debt Obligations | |||||||||||
Cash paid for the exchange of convertible notes | $ 219,800 | ||||||||||
Common stock exchanged (in shares) | shares | 6.8 | ||||||||||
(Loss) gain on extinguishment of debt | $ 5,000 | ||||||||||
Inducement charge | $ 1,100 |
Debt Obligations, Junior Subord
Debt Obligations, Junior Subordinated Notes (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Sep. 30, 2018 | Mar. 31, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Debt Obligations | |||||
(Loss) gain on extinguishment of debt | $ (4,960) | $ (4,960) | $ 7,116 | ||
Debt carrying value | $ 140,084 | $ 140,084 | $ 139,590 | ||
Weighted average note rate (as a percent) | 4.10% | 4.10% | 3.34% | ||
Junior subordinated notes | |||||
Debt Obligations | |||||
Junior Subordinated, Face Value | $ 20,900 | ||||
Debt carrying value purchased | 19,800 | ||||
(Loss) gain on extinguishment of debt | 7,100 | ||||
Extinguishment of notes | $ 21,500 | ||||
Debt carrying value | $ 140,100 | $ 140,100 | $ 139,600 | ||
Deferred amount Due at maturity | $ 12,100 | 12,100 | 12,500 | ||
Deferred fees expensed as interest expense | $ 2,100 | $ 2,200 | |||
Weighted average note rate (as a percent) | 5.25% | 5.25% | 4.53% | ||
Weighted average note rate including certain fees and costs (as a percent) | 5.34% | 5.34% | 4.63% |
Debt Obligations, Related Party
Debt Obligations, Related Party Financing (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | |
Jan. 31, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Debt Obligations | |||||
Repayment of debt | $ 50,000 | ||||
Outstanding principal balance of related party financing | $ 50,000 | ||||
ACM / Our "Former Manager" | |||||
Debt Obligations | |||||
Outstanding principal balance of related party financing | $ 50,000 | ||||
Interest expense | $ 1,000 | 300 | $ 2,900 | ||
Preferred equity interest financing agreement | ACM / Our "Former Manager" | |||||
Debt Obligations | |||||
Principal amount | $ 50,000 | ||||
Maturity period (in years) | 5 years | ||||
Repayment of debt | $ 50,000 | ||||
Outstanding principal balance of related party financing | $ 50,000 | ||||
Interest expense | $ 1,000 | $ 300 | $ 2,900 |
Debt Obligations, Debt Covenant
Debt Obligations, Debt Covenants (Details) - USD ($) | 1 Months Ended | |||||
Oct. 31, 2018 | Jul. 31, 2018 | Apr. 30, 2018 | Oct. 31, 2017 | Jan. 31, 2017 | Sep. 30, 2018 | |
CLO VI | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio (as a percent) | 129.87% | 129.87% | 129.87% | 129.87% | 129.87% | |
Limit overcollateralization ratio (as a percent) | 128.87% | |||||
Current interest coverage ratio (as a percent) | 208.68% | |||||
Limit interest coverage ratio (as a percent) | 120.00% | |||||
CLO VII | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio (as a percent) | 129.03% | 129.03% | 129.03% | 129.03% | 129.03% | |
Limit overcollateralization ratio (as a percent) | 128.03% | |||||
Current interest coverage ratio (as a percent) | 212.40% | |||||
Limit interest coverage ratio (as a percent) | 120.00% | |||||
CLO VIII | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio (as a percent) | 129.03% | 129.03% | 129.03% | 129.03% | 129.03% | |
Limit overcollateralization ratio (as a percent) | 128.03% | |||||
Current interest coverage ratio (as a percent) | 268.75% | |||||
Limit interest coverage ratio (as a percent) | 120.00% | |||||
CLO IX | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio (as a percent) | 134.68% | 134.68% | 134.69% | 134.68% | ||
Limit overcollateralization ratio (as a percent) | 133.68% | |||||
Current interest coverage ratio (as a percent) | 276.05% | |||||
Limit interest coverage ratio (as a percent) | 120.00% | |||||
CLO X | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio (as a percent) | 126.98% | 126.98% | ||||
Limit overcollateralization ratio (as a percent) | 125.98% | |||||
Current interest coverage ratio (as a percent) | 236.32% | |||||
Limit interest coverage ratio (as a percent) | 120.00% | |||||
Junior subordinated notes | ||||||
Debt Covenants | ||||||
Amount payable on default of senior debt | $ 0 |
Allowance for Loss-Sharing Ob_3
Allowance for Loss-Sharing Obligations (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Roll forward of loss contingency accrual | |||||
(Charge-offs) recoveries, net | $ 54 | $ (1,844) | |||
Loss-Sharing Obligation | |||||
Roll forward of loss contingency accrual | |||||
Outstanding advances under the Fannie Mae DUS program | $ 100 | 100 | $ 100 | ||
Loss-Sharing Obligation | Fannie Mae | |||||
Roll forward of loss contingency accrual | |||||
Beginning balance of the period | 31,402 | $ 32,797 | 30,511 | 32,407 | |
Provisions for loss sharing | 2,924 | 1,265 | 5,263 | 5,410 | |
Provisions reversal for loan repayments | (905) | (3,882) | (2,423) | (5,815) | |
(Charge-offs) recoveries, net | (16) | (22) | 54 | (1,844) | |
Ending balance of the period | 33,405 | $ 30,158 | 33,405 | $ 30,158 | |
Maximum quantifiable liability | $ 2,380,000 | $ 2,380,000 | $ 2,240,000 |
Derivative Financial Instrume_3
Derivative Financial Instruments, Agency Business (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2018USD ($)item | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)item | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($)item | |
Derivative Financial Instruments | |||||
Notional Value, classified in Other Assets | $ 155,202 | $ 155,202 | $ 77,984 | ||
Notional Value, classified in Other Liabilities | 413,694 | 413,694 | 291,421 | ||
Net gains (losses) from changes in the fair value of derivatives | (4,400) | $ (200) | 2,300 | $ (2,300) | |
Income from mortgage servicing rights | 25,216 | $ 18,897 | 62,787 | $ 56,182 | |
Agency Business | |||||
Derivative Financial Instruments | |||||
Notional Value, classified in Other Assets | 568,896 | 568,896 | 369,405 | ||
Fair Value, classified in Other Assets | 926 | 926 | 684 | ||
Fair Value, classified in Other Liabilities | $ (3,406) | $ (3,406) | $ (1,306) | ||
Non-Qualifying | Rate lock commitments | Agency Business | |||||
Derivative Financial Instruments | |||||
Count | item | 6 | 6 | 3 | ||
Notional Value, classified in Other Assets | $ 37,965 | $ 37,965 | $ 38,578 | ||
Fair Value, classified in Other Assets | 749 | 749 | 276 | ||
Fair Value, classified in Other Liabilities | $ (28) | $ (28) | $ (278) | ||
Non-Qualifying | Forward Sale Commitments | Agency Business | |||||
Derivative Financial Instruments | |||||
Count | item | 57 | 57 | 75 | ||
Notional Value, classified in Other Assets | $ 530,931 | $ 530,931 | $ 330,827 | ||
Fair Value, classified in Other Assets | 177 | 177 | 408 | ||
Fair Value, classified in Other Liabilities | $ (3,378) | $ (3,378) | $ (1,028) |
Fair Value, Carrying Value and
Fair Value, Carrying Value and Estimated Fair Value (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Financial assets: | ||
Loans and investments, net - Principal/Notional Amount | $ 3,170,117 | $ 2,652,538 |
Loans and investments, net | 3,097,689 | 2,579,127 |
Loans held-for-sale, net - Principal/Notional Amount | 492,966 | 292,249 |
Securities, held-to-maturity, net - Principal/Notional Amount | 70,518 | 40,566 |
Securities held-to-maturity, net | 50,520 | 27,837 |
Derivative financial instruments - Principal/Notional Amount | 155,202 | 77,984 |
Financial liabilities: | ||
Credit and repurchase facilities, Principal/Notional Amount | 1,172,413 | 530,938 |
Credit and repurchase facilities, Carrying value | 1,169,586 | 528,573 |
Collateralized loan obligations | 1,592,089 | 1,418,422 |
Debt fund | 68,099 | 68,084 |
Senior unsecured notes | 122,358 | 95,280 |
Convertible senior unsecured notes, net | 263,653 | 231,287 |
Junior subordinated notes | 140,084 | 139,590 |
Related party financing | 50,000 | |
Derivative financial instruments - Principal/Notional Amount | $ 413,694 | 291,421 |
Maximum number of days held-for-sale loans are typically sold | 60 days | |
Carrying Value | ||
Financial assets: | ||
Loans and investments, net | $ 3,097,689 | 2,579,127 |
Loans held-for-sale, net | 500,281 | 297,443 |
Capitalized mortgage servicing rights, net | 259,401 | 252,608 |
Securities held-to-maturity, net | 50,520 | 27,837 |
Derivative financial instruments | 926 | 684 |
Financial liabilities: | ||
Credit and repurchase facilities, Carrying value | 1,169,586 | 528,573 |
Collateralized loan obligations | 1,592,089 | 1,418,422 |
Debt fund | 68,099 | 68,084 |
Senior unsecured notes | 122,358 | 95,280 |
Convertible senior unsecured notes, net | 263,653 | 231,287 |
Junior subordinated notes | 140,084 | 139,590 |
Related party financing | 50,000 | |
Derivative financial instruments | 3,406 | 1,306 |
Fair Value | ||
Financial assets: | ||
Loans and investments, net | 3,154,139 | 2,652,520 |
Loans held-for-sale, net | 507,698 | 302,883 |
Capitalized mortgage servicing rights, net | 312,316 | 286,073 |
Securities held-to-maturity, net | 52,312 | 28,439 |
Derivative financial instruments | 926 | 684 |
Financial liabilities: | ||
Credit and repurchase facilities, Carrying value | 1,170,235 | 529,992 |
Collateralized loan obligations | 1,616,293 | 1,436,871 |
Debt fund | 70,135 | 70,000 |
Senior unsecured notes | 124,375 | 99,582 |
Convertible senior unsecured notes, net | 289,560 | 254,335 |
Junior subordinated notes | 95,458 | 94,215 |
Related party financing | 49,682 | |
Derivative financial instruments | 3,406 | 1,306 |
CLOs | ||
Financial liabilities: | ||
Debt instrument - Principal/Notional Amount | 1,609,524 | 1,436,274 |
Collateralized loan obligations | 1,592,089 | 1,418,422 |
Debt Fund | ||
Financial liabilities: | ||
Debt instrument - Principal/Notional Amount | 70,000 | 70,000 |
Senior Unsecured Notes | ||
Financial liabilities: | ||
Debt instrument - Principal/Notional Amount | 125,000 | 97,860 |
Convertible Senior Unsecured Notes | ||
Financial liabilities: | ||
Debt instrument - Principal/Notional Amount | 280,816 | 243,750 |
Junior subordinated notes | ||
Financial liabilities: | ||
Debt instrument - Principal/Notional Amount | 154,336 | 154,336 |
Junior subordinated notes | $ 140,100 | $ 139,600 |
Fair Value, Measurement on Recu
Fair Value, Measurement on Recurring and Nonrecurring Basis (Details) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018USD ($)item | Sep. 30, 2018USD ($)item | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($) | |
Financial assets: | ||||
Allowance for impaired loan losses | $ 60,951 | $ 60,951 | $ 62,783 | |
Number of impaired loans | item | 5 | 5 | ||
Non-financial assets: | ||||
Long-lived assets | $ 14,563 | $ 14,563 | 16,787 | |
Impairment loss on real estate owned | 2,000 | $ 2,700 | ||
Real Estate Owned | ||||
Non-financial assets: | ||||
Long-lived assets | 14,563 | 14,563 | 16,787 | |
Office | ||||
Financial assets: | ||||
Allowance for impaired loan losses | 1,500 | 1,500 | 1,500 | |
Office | Real Estate Owned | ||||
Non-financial assets: | ||||
Long-lived assets | 3,210 | 3,210 | 5,329 | |
Impairment loss on real estate owned | 2,000 | 2,000 | ||
Carrying Value | ||||
Financial assets: | ||||
Derivative financial instruments | 926 | 926 | 684 | |
Aggregate carrying value of impaired loans before loan loss reserves | 131,900 | 131,900 | ||
Financial liabilities: | ||||
Derivative financial instruments | 3,406 | 3,406 | 1,306 | |
Fair Value | ||||
Financial assets: | ||||
Derivative financial instruments | 926 | 926 | 684 | |
Financial liabilities: | ||||
Derivative financial instruments | 3,406 | 3,406 | $ 1,306 | |
Recurring basis | Carrying Value | ||||
Financial assets: | ||||
Derivative financial instruments | 926 | 926 | ||
Financial liabilities: | ||||
Derivative financial instruments | 3,406 | 3,406 | ||
Recurring basis | Fair Value | ||||
Financial assets: | ||||
Derivative financial instruments | 926 | 926 | ||
Financial liabilities: | ||||
Derivative financial instruments | 3,406 | 3,406 | ||
Nonrecurring basis | Carrying Value | ||||
Financial assets: | ||||
Impaired loans, net | 70,909 | 70,909 | ||
Non-financial assets: | ||||
Long-lived assets | 14,563 | 14,563 | ||
Nonrecurring basis | Fair Value | ||||
Financial assets: | ||||
Impaired loans, net | 70,909 | 70,909 | ||
Non-financial assets: | ||||
Long-lived assets | 14,563 | 14,563 | ||
Level 2 | Recurring basis | ||||
Financial assets: | ||||
Derivative financial instruments | 177 | 177 | ||
Financial liabilities: | ||||
Derivative financial instruments | 3,406 | 3,406 | ||
Level 3 | Recurring basis | ||||
Financial assets: | ||||
Derivative financial instruments | 749 | 749 | ||
Level 3 | Nonrecurring basis | ||||
Financial assets: | ||||
Impaired loans, net | 70,909 | 70,909 | ||
Non-financial assets: | ||||
Long-lived assets | $ 14,563 | $ 14,563 |
Fair Value, Level 3 Inputs (Det
Fair Value, Level 3 Inputs (Details) - Level 3 $ in Thousands | Sep. 30, 2018USD ($)item |
Office | |
Quantitative information about Level 3 fair value measurements | |
Long-lived assets, fair value | $ | $ 3,210 |
Land | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, fair value | $ | $ 70,135 |
Land | Discount rate | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, measurement input | 0.1500 |
Land | Capitalization rate | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, measurement input | 0.0725 |
Land | Revenue growth rate | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, measurement input | 0.0300 |
Office | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, fair value | $ | $ 774 |
Office | Discount rate | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, measurement input | 0.1053 |
Office | Capitalization rate | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, measurement input | 0.0853 |
Office | Revenue growth rate | |
Quantitative information about Level 3 fair value measurements | |
Impaired loans, measurement input | 0.0263 |
Rate lock commitments | |
Quantitative information about Level 3 fair value measurements | |
Derivative financial instruments | $ | $ 749 |
Derivative Asset, Valuation Technique [Extensible List] | us-gaap:ValuationTechniqueDiscountedCashFlowMember |
Derivative Asset, Measurement Input [Extensible List] | Measurement Input Discount Rate [Member] |
Rate lock commitments | Discount rate | |
Quantitative information about Level 3 fair value measurements | |
Derivative financial instruments measurement input | 0.1015 |
Fair Value, Level 3 Derivative
Fair Value, Level 3 Derivative Instruments (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Derivative assets | ||||
Balance at beginning of period | $ 606 | $ 1,420 | $ 276 | $ 2,816 |
Settlements | (17,793) | (18,897) | (62,313) | (57,578) |
Realized gains recorded in earnings | 17,187 | 17,477 | 62,037 | 54,762 |
Unrealized gains recorded in earnings | 749 | 420 | 749 | 420 |
Balance at end of period | $ 749 | $ 420 | $ 749 | $ 420 |
Fair Value, Components of fair
Fair Value, Components of fair value and other relevant information (Details) | 9 Months Ended |
Sep. 30, 2018USD ($) | |
Fair Value of Servicing Rights | $ 9,208 |
Total Fair Value Adjustment | 9,208 |
Rate lock commitments | |
Notional/Principal Amount | 37,965 |
Fair Value of Servicing Rights | 749 |
Interest Rate Movement Effect | (28) |
Total Fair Value Adjustment | 721 |
Forward Sale Commitments | |
Notional/Principal Amount | 530,931 |
Interest Rate Movement Effect | 28 |
Total Fair Value Adjustment | 28 |
Loans held-for-sale, net | |
Notional/Principal Amount | 492,966 |
Fair Value of Servicing Rights | 8,459 |
Total Fair Value Adjustment | $ 8,459 |
Fair Value, Financial Assets an
Fair Value, Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Financial assets: | ||
Loans and investments, net | $ 3,097,689 | $ 2,579,127 |
Securities held-to-maturity, net | 50,520 | 27,837 |
Financial liabilities: | ||
Credit and repurchase facilities, Carrying value | 1,169,586 | 528,573 |
Collateralized loan obligations | 1,592,089 | 1,418,422 |
Debt fund | 68,099 | 68,084 |
Senior unsecured notes | 122,358 | 95,280 |
Convertible senior unsecured notes, net | 263,653 | 231,287 |
Junior subordinated notes | 140,084 | 139,590 |
Level 1 | ||
Financial liabilities: | ||
Senior unsecured notes | 124,375 | |
Level 2 | ||
Financial assets: | ||
Loans held-for-sale, net | 499,239 | |
Financial liabilities: | ||
Credit and repurchase facilities, Carrying value | 492,603 | |
Convertible senior unsecured notes, net | 289,560 | |
Level 3 | ||
Financial assets: | ||
Loans and investments, net | 3,154,139 | |
Loans held-for-sale, net | 8,459 | |
Capitalized mortgage servicing rights, net | 312,316 | |
Securities held-to-maturity, net | 52,312 | |
Financial liabilities: | ||
Credit and repurchase facilities, Carrying value | 677,632 | |
Collateralized loan obligations | 1,616,293 | |
Debt fund | 70,135 | |
Junior subordinated notes | 95,458 | |
Carrying Value | ||
Financial assets: | ||
Loans and investments, net | 3,097,689 | 2,579,127 |
Loans held-for-sale, net | 500,281 | 297,443 |
Capitalized mortgage servicing rights, net | 259,401 | |
Securities held-to-maturity, net | 50,520 | 27,837 |
Financial liabilities: | ||
Credit and repurchase facilities, Carrying value | 1,169,586 | 528,573 |
Collateralized loan obligations | 1,592,089 | 1,418,422 |
Debt fund | 68,099 | 68,084 |
Senior unsecured notes | 122,358 | 95,280 |
Convertible senior unsecured notes, net | 263,653 | 231,287 |
Junior subordinated notes | 140,084 | 139,590 |
Fair Value | ||
Financial assets: | ||
Loans and investments, net | 3,154,139 | 2,652,520 |
Loans held-for-sale, net | 507,698 | 302,883 |
Capitalized mortgage servicing rights, net | 312,316 | |
Securities held-to-maturity, net | 52,312 | 28,439 |
Financial liabilities: | ||
Credit and repurchase facilities, Carrying value | 1,170,235 | 529,992 |
Collateralized loan obligations | 1,616,293 | 1,436,871 |
Debt fund | 70,135 | 70,000 |
Senior unsecured notes | 124,375 | 99,582 |
Convertible senior unsecured notes, net | 289,560 | 254,335 |
Junior subordinated notes | $ 95,458 | $ 94,215 |
Commitments and Contingencies,
Commitments and Contingencies, Contractual Commitments (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2018 | Dec. 31, 2017 | |
Agency Business Commitments | ||
Cash collateral | $ 202,736 | $ 139,398 |
Debt Obligations | ||
Remainder of 2018 | 565,900 | |
2,019 | 356,200 | |
2,020 | 972,000,000 | |
2,021 | 872,300 | |
2,022 | 244,200 | |
Thereafter | 401,400 | |
Unfunded CLO Commitments | ||
Unfunded commitments related to structured loans and investments | 68,600 | |
Cash collateral arrangement - purchase and loss obligations under Freddie Mac's SBL Program | ||
Agency Business Commitments | ||
Cash collateral per securitization | 5,000 | |
Outstanding letters of credit | $ 5,000 | |
Forward Contracts | ||
Agency Business Commitments | ||
Period of contractual commitment | 60 days | |
Fannie Mae | ||
Agency Business Commitments | ||
Minimum liquid assets to be maintained to meet operational liquidity requirements | $ 12,900 | |
Period of funding for collateral requirement | 48 months | |
Fannie Mae | Restricted liquidity arrangement - loans sold under the Fannie Mae DUS program | ||
Agency Business Commitments | ||
Letter of credit assigned | $ 44,000 | |
Reserve required to fund additional restricted liquidity over the next 48 months | $ 29,700 | |
Period of additional funding for collateral requirement | 48 months |
Commitments and Contingencies_2
Commitments and Contingencies, Litigation (Details) $ in Thousands | Jun. 15, 2011USD ($)lawsuitdefendant | Jul. 31, 2018USD ($) | Jun. 30, 2013USD ($)lawsuitdefendant | Jun. 30, 2011lawsuitdefendant | Sep. 30, 2018USD ($) | Sep. 30, 2018USD ($) |
Litigation | ||||||
Litigation settlement gain | $ | $ 10,170 | $ 10,170 | ||||
Arbor ESH II, LLC | ||||||
Litigation | ||||||
Investments in the Series A1 Preferred Units of a holding company of Extended Stay, Inc. | $ | $ 115,000 | |||||
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | ||||||
Litigation | ||||||
Number of lawsuits or complaints filed | lawsuit | 3 | |||||
Number of lawsuits filed in United States Bankruptcy Court | lawsuit | 2 | |||||
Number of defendants | 73 | |||||
Number of defendants who are corporate and partnership entities | 55 | |||||
Number of defendants named in a legal action who are individuals | 18 | |||||
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | Fiduciary Duty Claims | ||||||
Litigation | ||||||
Number of lawsuits or complaints filed | lawsuit | 2 | |||||
Number of defendants | 2 | |||||
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | Motion to amend the lawsuits | ||||||
Litigation | ||||||
Number of lawsuits consolidated | lawsuit | 1 | |||||
Number of defendants removed due to consolidation of lawsuits | 47 | |||||
Number of defendants related to the entity | 0 | |||||
Number of defendants remaining due to consolidation of lawsuits | 26 | |||||
Number of defendants who are corporate and partnership entities | 16 | |||||
Number of defendants named in a legal action who are individuals | 10 | |||||
Number of lawsuits before amendment | lawsuit | 100 | |||||
Number of lawsuits after amendment | lawsuit | 17 | |||||
Aggregate amount which the Trust would be seeking from the affiliates of the entity | $ | $ 139,000 | |||||
Litigation related to prior structured finance investment | ||||||
Litigation | ||||||
Net proceeds received | $ | $ 10,200 |
Variable Interest Entities (Det
Variable Interest Entities (Details) | 9 Months Ended | |||||
Sep. 30, 2018USD ($)item | Jun. 30, 2018USD ($) | Dec. 31, 2017USD ($) | Sep. 30, 2017USD ($) | Jun. 30, 2017USD ($) | Dec. 31, 2016USD ($) | |
Variable Interest Entities | ||||||
Loan loss reserves related to VIEs | $ 60,951,000 | $ 58,733,000 | $ 62,783,000 | $ 83,256,000 | $ 81,256,000 | $ 83,712,000 |
Assets: | ||||||
Restricted cash | 202,736,000 | 139,398,000 | ||||
Loans and investments, net | 3,097,689,000 | 2,579,127,000 | ||||
Due from related party | 97,505,000 | 688,000 | ||||
Other assets | 79,301,000 | 62,264,000 | ||||
Total assets | 4,534,260,000 | 3,625,945,000 | ||||
Liabilities: | ||||||
Collateralized loan obligations | 1,592,089,000 | 1,418,422,000 | ||||
Debt fund | 68,099,000 | 68,084,000 | ||||
Other liabilities | 100,970,000 | 99,813,000 | ||||
Total liabilities | 3,567,788,000 | 2,761,389,000 | ||||
Consolidated VIEs | ||||||
Assets: | ||||||
Restricted cash | 201,986,000 | 138,736,000 | ||||
Loans and investments, net | 1,885,104,000 | 1,836,744,000 | ||||
Due from related party | 95,045,000 | |||||
Other assets | 15,408,000 | 14,011,000 | ||||
Total assets | 2,197,543,000 | 1,989,491,000 | ||||
Liabilities: | ||||||
Collateralized loan obligations | 1,592,089,000 | 1,418,422,000 | ||||
Debt fund | 68,099,000 | 68,084,000 | ||||
Other liabilities | 3,013,000 | 2,046,000 | ||||
Total liabilities | $ 1,663,201,000 | $ 1,488,552,000 | ||||
Unconsolidated VIEs | ||||||
Variable Interest Entities | ||||||
Number of VIEs where the reporting entity is not VIE's primary beneficiary and VIEs have variable interest | item | 23 | |||||
Carrying Amount | $ 341,198 | |||||
Carrying amount of loans and investments before reserves related to VIEs | 130,200,000 | |||||
Loan loss reserves related to VIEs | 59,300,000 | |||||
Exposure to real estate debt | 3,010,000,000 | |||||
Unconsolidated VIEs | Loans | ||||||
Variable Interest Entities | ||||||
Carrying Amount | 287,166,000 | |||||
Unconsolidated VIEs | B Piece bonds | ||||||
Variable Interest Entities | ||||||
Carrying Amount | 50,520,000 | |||||
Unconsolidated VIEs | Agency interest only strips | ||||||
Variable Interest Entities | ||||||
Carrying Amount | $ 3,512,000 |
Equity (Details)
Equity (Details) $ / shares in Units, $ in Thousands | Oct. 31, 2018$ / shares | Aug. 01, 2018$ / shares | May 02, 2018$ / shares | Feb. 21, 2018$ / shares | Feb. 02, 2018$ / shares | Jul. 14, 2016USD ($) | Aug. 31, 2018USD ($)itemshares | Jul. 31, 2018shares | May 31, 2018USD ($)$ / sharesshares | Mar. 31, 2018USD ($)shares | Sep. 30, 2018Vote$ / sharesshares | Mar. 31, 2018USD ($)shares | Sep. 30, 2017$ / shares | Sep. 30, 2018USD ($)Vote$ / sharesshares | Sep. 30, 2017USD ($)$ / shares | Dec. 31, 2017$ / sharesshares | Dec. 31, 2016shares | Dec. 31, 2015 | Jun. 30, 2018USD ($) |
Common stock | |||||||||||||||||||
Shares issued in connection with exchange of convertible debt notes (in shares) | 74,322,000 | ||||||||||||||||||
Proceeds from issuance of shares under public offering | $ | $ 55,908 | $ 76,225 | |||||||||||||||||
Payment to internalize the management team and terminate the existing management agreement using the proceed from public offering | $ | $ 25,000 | ||||||||||||||||||
Noncontrolling Interest | |||||||||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | $ 0.01 | ||||||||||||||||
OP Units redeemed by cash | $ | $ (6,845) | ||||||||||||||||||
Distributions | |||||||||||||||||||
Cash dividend declared (in dollars per share) | $ / shares | $ 0.25 | $ 0.18 | $ 0.71 | $ 0.53 | |||||||||||||||
Chief executive officer | Restricted common stock | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Number of fully vested shares issued | 63,584 | ||||||||||||||||||
Total grant date fair value | $ | $ 600 | ||||||||||||||||||
Vesting percentage | 25.00% | ||||||||||||||||||
Chief executive officer | Restricted common stock | First Anniversaries | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Vesting percentage | 25.00% | ||||||||||||||||||
Chief executive officer | Restricted common stock | Second Anniversaries | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Vesting percentage | 25.00% | ||||||||||||||||||
Chief executive officer | Restricted common stock | Third Anniversaries | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Vesting percentage | 25.00% | ||||||||||||||||||
Chief executive officer | Performance-based restricted stock | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Granted of restricted stock units that vest at the end of four-year performance period (in shares) | 294,985 | 381,503 | |||||||||||||||||
Vesting period (in years) | 4 years | 4 years | 4 years | 4 years | |||||||||||||||
Total grant date fair value | $ | $ 3,400 | $ 800 | |||||||||||||||||
Chief executive officer | Employee compensation and benefits | Restricted common stock | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Share-based compensation expense | $ | 100 | ||||||||||||||||||
Chief executive officer | Employee compensation and benefits | Performance-based restricted stock | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Share-based compensation expense | $ | $ 200 | ||||||||||||||||||
Chief executive officer | Employee compensation and benefits | Performance-based restricted stock | Maximum | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Share-based compensation expense | $ | $ 100 | ||||||||||||||||||
Employees | Restricted common stock | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Number of fully vested shares issued | 265,444 | ||||||||||||||||||
Total grant date fair value | $ | $ 2,300 | ||||||||||||||||||
Vesting percentage | 33.00% | ||||||||||||||||||
Employees | Restricted common stock | March, 2019 | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Vesting percentage | 33.00% | ||||||||||||||||||
Employees | Restricted common stock | March 2020 | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Vesting percentage | 33.00% | ||||||||||||||||||
Employees | Employee compensation and benefits | Restricted common stock | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Share-based compensation expense | $ | $ 800 | ||||||||||||||||||
8.25% Series A preferred stock | |||||||||||||||||||
Preferred Stock | |||||||||||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.25% | 8.25% | 8.25% | ||||||||||||||||
7.75% Series B preferred stock | |||||||||||||||||||
Preferred Stock | |||||||||||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 7.75% | 7.75% | 7.75% | ||||||||||||||||
8.50% Series C preferred stock | |||||||||||||||||||
Preferred Stock | |||||||||||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.50% | 8.50% | 8.50% | ||||||||||||||||
Common Stock | |||||||||||||||||||
Common stock | |||||||||||||||||||
Shares issued in connection with exchange of convertible debt notes (in shares) | 6,820,196 | ||||||||||||||||||
Number of common stock sold under public offering (in shares) | 6,452,700 | ||||||||||||||||||
Aggregate amount of debt securities, common stock, preferred stock, depositary shares and warrants filed under shelf registration statement | $ | $ 500,000 | ||||||||||||||||||
Distributions | |||||||||||||||||||
Cash dividend declared (in dollars per share) | $ / shares | $ 0.27 | $ 0.25 | $ 0.25 | $ 0.21 | |||||||||||||||
Common Stock | Non-management members of the Board of Directors | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Number of fully vested shares issued | 58,620 | ||||||||||||||||||
Common Stock | Non-management members of the Board of Directors | Selling and administrative expense | |||||||||||||||||||
Deferred Compensation | |||||||||||||||||||
Share-based compensation expense | $ | $ 500 | ||||||||||||||||||
Preferred Stock | 8.25% Series A preferred stock | |||||||||||||||||||
Distributions | |||||||||||||||||||
Cash dividend declared on redeemable preferred stock (in dollars per share) | $ / shares | $ 0.515625 | 0.515625 | 0.515625 | $ 0.515625 | |||||||||||||||
Preferred Stock | |||||||||||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.25% | ||||||||||||||||||
Preferred Stock | 7.75% Series B preferred stock | |||||||||||||||||||
Distributions | |||||||||||||||||||
Cash dividend declared on redeemable preferred stock (in dollars per share) | $ / shares | $ 0.484375 | 0.484375 | 0.484375 | 0.484375 | |||||||||||||||
Preferred Stock | |||||||||||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 7.75% | ||||||||||||||||||
Preferred Stock | 8.50% Series C preferred stock | |||||||||||||||||||
Distributions | |||||||||||||||||||
Cash dividend declared on redeemable preferred stock (in dollars per share) | $ / shares | $ 0.53125 | $ 0.53125 | $ 0.53125 | $ 0.53125 | |||||||||||||||
Preferred Stock | |||||||||||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.50% | ||||||||||||||||||
ACM Acquisition | ACM / Our "Former Manager" | |||||||||||||||||||
Noncontrolling Interest | |||||||||||||||||||
Consideration in stock to be paid with operating partnership units (in shares) | 577,185 | 14,873,236 | 5,780,348 | 21,230,769 | |||||||||||||||
Number of preferred stock shares paired with each OP units | 1 | ||||||||||||||||||
Number of partners in consideration | item | 2 | ||||||||||||||||||
OP units outstanding (in shares) | 20,653,584 | 20,653,584 | |||||||||||||||||
5.375% Convertible Notes | |||||||||||||||||||
Common stock | |||||||||||||||||||
Interest rate (as a percent) | 5.375% | 5.375% | 5.375% | ||||||||||||||||
6.50% Convertible Notes | |||||||||||||||||||
Common stock | |||||||||||||||||||
Interest rate (as a percent) | 6.50% | 6.50% | 6.50% | ||||||||||||||||
Operating Partnership Units | |||||||||||||||||||
Noncontrolling Interest | |||||||||||||||||||
Consideration in stock to be paid with operating partnership units (in shares) | 21,230,769 | ||||||||||||||||||
Value of operating partnership units issues as consideration | $ | $ 154,800 | ||||||||||||||||||
Conversion ratio for operating partnership units to common stock shares | 1 | ||||||||||||||||||
Operating Partnership Units | Special voting preferred shares | |||||||||||||||||||
Noncontrolling Interest | |||||||||||||||||||
Number of preferred stock shares paired with each OP units | 1 | ||||||||||||||||||
Number of vote per share of Special Voting Preferred Shares | Vote | 1 | 1 | |||||||||||||||||
Preferred stock, par value (in dollars per share) | $ / shares | $ 0.01 | $ 0.01 | |||||||||||||||||
Voting power of outstanding stock (as a percent) | 21.40% | ||||||||||||||||||
Public offering | Common Stock | |||||||||||||||||||
Common stock | |||||||||||||||||||
Number of common stock sold under public offering (in shares) | 5,500,000 | ||||||||||||||||||
Issued price per share (in dollars per share) | $ / shares | $ 8.72 | ||||||||||||||||||
Proceeds from issuance of shares under public offering | $ | $ 47,800 | ||||||||||||||||||
At-The-Market | Common Stock | |||||||||||||||||||
Common stock | |||||||||||||||||||
Number of common stock sold under public offering (in shares) | 952,700 | ||||||||||||||||||
Number of shares to issue and sell | 7,500,000 | 7,500,000 | |||||||||||||||||
Proceeds from issuance of shares under public offering | $ | $ 8,100 | ||||||||||||||||||
Number of shares available under an "At-The-Market" equity offering with JMP Securities LLC | 6,500,000 | 6,500,000 |
Equity, Earnings Per Share ("EP
Equity, Earnings Per Share ("EPS") (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | Dec. 31, 2016 | Dec. 31, 2015 | |
Basic | |||||||
Net income attributable to common stockholders | $ 27,737 | $ 16,421 | $ 71,093 | $ 43,964 | |||
Weighted average shares outstanding (in shares) | 74,802,582 | 61,582,796 | 67,490,132 | 56,602,504 | |||
Net income per common share (in dollars per share) | $ 0.37 | $ 0.27 | $ 1.05 | $ 0.78 | |||
Diluted | |||||||
Net income attributable to noncontrolling interest | $ 7,799 | $ 5,662 | $ 22,347 | $ 16,597 | |||
Net income attributable to common stockholders and noncontrolling interest | $ 35,536 | $ 22,083 | $ 93,440 | $ 60,561 | |||
Weighted average shares outstanding (in shares) | 74,802,582 | 61,582,796 | 67,490,132 | 56,602,504 | |||
Dilutive effect of OP units (in shares) | 21,023,735 | 21,230,769 | 21,160,999 | 21,230,769 | |||
Dilutive effect of restricted stock units (in shares) | 1,559,217 | 1,104,552 | 1,441,264 | 1,077,178 | |||
Dilutive effect of convertible notes (in shares) | 1,050,430 | 1,041,212 | 32,468 | ||||
Weighted average shares outstanding ( in shares) | 98,435,964 | 83,918,117 | 91,133,607 | 78,942,919 | |||
Net income per common share (in dollars per share) | $ 0.36 | $ 0.26 | $ 1.03 | $ 0.77 | |||
Chief executive officer | Performance-based restricted stock | |||||||
Diluted | |||||||
Vesting period (in years) | 4 years | 4 years | 4 years | 4 years |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jan. 31, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | Dec. 31, 2017 | |
Federal income tax rate (as a percent) | 21.00% | 35.00% | ||||
Provision for income taxes | $ (5,381) | $ (6,708) | $ (1,096) | $ (16,244) | ||
Deferred tax (benefit) provision | 1,300 | (900) | (14,454) | 15 | ||
Current tax provision (benefit) | $ 6,700 | $ 7,600 | (15,600) | $ 16,200 | ||
Repayment of debt | $ 50,000 | |||||
Preferred equity interest financing agreement | ACM / Our "Former Manager" | ||||||
Repayment of debt | $ 50,000 |
Agreements and Transactions w_2
Agreements and Transactions with Related Parties, Management Agreement (Details) - USD ($) $ in Millions | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Management Fees: | ||||
Base management fee incurred | $ 6.7 | |||
Former manager | Support Services | ||||
Agreements and transactions with related parties | ||||
Costs for services to related party | $ 0.3 | $ 0.3 | $ 0.9 | $ 0.4 |
Agreements and Transactions w_3
Agreements and Transactions with Related Parties, Other (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 9 Months Ended | 12 Months Ended | 42 Months Ended | |||||||||||||||||
Aug. 31, 2018USD ($)shares | Jun. 30, 2018USD ($)propertyloanitem | May 31, 2018USD ($)loan | Apr. 30, 2018USD ($) | Dec. 31, 2017USD ($)property | Aug. 31, 2017USD ($)loan | Jul. 31, 2017USD ($) | May 31, 2017USD ($) | Mar. 31, 2017USD ($)item | Jan. 31, 2017USD ($) | Sep. 30, 2018USD ($)shares | Dec. 31, 2017USD ($)propertyitem | Sep. 30, 2017USD ($) | Sep. 30, 2018USD ($)shares | Sep. 30, 2017USD ($) | Dec. 31, 2017USD ($)propertyshares | Dec. 31, 2016USD ($)propertyshares | Dec. 31, 2015USD ($)loan | Dec. 31, 2014USD ($)loanitem | Jun. 30, 2018USD ($) | Jan. 31, 2018USD ($) | Mar. 31, 2016USD ($) | |
Agreements and transactions with related parties | ||||||||||||||||||||||
Due from related party | $ 688 | $ 97,505 | $ 688 | $ 97,505 | $ 688 | |||||||||||||||||
Due to related party | 538 | 538 | ||||||||||||||||||||
Related party financing | 50,000 | 50,000 | 50,000 | |||||||||||||||||||
Outstanding principal balance of related party financing | 50,000 | 50,000 | 50,000 | |||||||||||||||||||
Income from equity affiliates | (1,028) | $ 996 | 1,104 | $ 1,756 | ||||||||||||||||||
Investments in equity affiliates | 23,653 | 22,101 | 23,653 | 22,101 | 23,653 | |||||||||||||||||
Residential Mortgage Banking Company | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Maximum percentage of guaranty provided by the Company in relation to the settlement | 50.00% | |||||||||||||||||||||
Maximum exposure under guaranty | 2,300 | 2,300 | ||||||||||||||||||||
Preferred equity investments | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | 5,000 | $ 15,000 | 5,000 | $ 5,000 | ||||||||||||||||||
Commitment to fund additional investment | $ 5,000 | |||||||||||||||||||||
Interest income recorded | 200 | 500 | ||||||||||||||||||||
Fixed rate of interest (as a percent) | 11.00% | |||||||||||||||||||||
Amount of ownership interest of related party in the entity | $ 5,000 | |||||||||||||||||||||
Mezzanine loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Interest income recorded | 100 | 100 | 300 | |||||||||||||||||||
Fixed rate of interest (as a percent) | 12.50% | |||||||||||||||||||||
Amount of loan to related party | $ 3,000 | |||||||||||||||||||||
ACM / Our "Former Manager" | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Related party financing | $ 50,000 | |||||||||||||||||||||
Interest expense on related party loan | 1,000 | 300 | 2,900 | |||||||||||||||||||
Outstanding principal balance of related party financing | $ 50,000 | |||||||||||||||||||||
ACM / Our "Former Manager" | Residential Mortgage Banking Company | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Noncontrolling interest in equity method investment acquired (as a percent) | 50.00% | |||||||||||||||||||||
Indirect ownership percentage | 22.5% | |||||||||||||||||||||
Acquisition purchase price | $ 9,600 | |||||||||||||||||||||
Income from equity affiliates | $ 400 | (1,200) | $ 1,200 | (1,800) | ||||||||||||||||||
Maximum percentage of guaranty provided by the Company in relation to the settlement | 50.00% | |||||||||||||||||||||
ACM / Our "Former Manager" | ACM Acquisition | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Number of preferred stock shares paired with each OP units | shares | 1 | |||||||||||||||||||||
Number of shares held by related party | shares | 5,349,053 | 5,349,053 | ||||||||||||||||||||
OP units hold as part of acquisition | shares | 577,185 | 14,873,236 | 5,780,348 | 21,230,769 | ||||||||||||||||||
Percentage of voting power held by related party | 21.00% | 21.00% | ||||||||||||||||||||
ACM / Our "Former Manager" | Non-qualified Residential Mortgages | Residential Mortgage Banking Company | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Additional investment made by the company along with a consortium of independent outside investors | $ 16,100 | |||||||||||||||||||||
Proceeds from sale of available-for-sale securities | $ 700 | 16,900 | ||||||||||||||||||||
ACM / Our "Former Manager" | Mortgage loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Amount of mortgage loan secured by property, purchased by related party | $ 47,000 | |||||||||||||||||||||
ACM / Our "Former Manager" | Preferred equity interest financing agreement | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Related party financing | 50,000 | 50,000 | $ 50,000 | |||||||||||||||||||
Interest expense on related party loan | 1,000 | 300 | 2,900 | |||||||||||||||||||
Outstanding principal balance of related party financing | 50,000 | 50,000 | 50,000 | |||||||||||||||||||
ACM / Our "Former Manager" | Maturity date of April 2016, extended to April 2018 | Mortgage loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Base spread (as a percent) | 4.80% | |||||||||||||||||||||
Interest income recorded | 200 | 200 | 700 | |||||||||||||||||||
Number of mortgage loans secured by property purchased from related party | loan | 2 | |||||||||||||||||||||
ACM / Our "Former Manager" | Maturity date of April 2016, extended to April 2018 | Mortgage loans | First mortgage | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Amount of mortgage loan secured by property, purchased by related party | $ 14,600 | |||||||||||||||||||||
ACM / Our "Former Manager" | Maturity date of April 2016, extended to April 2018 | Mortgage loans | Second mortgage | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Proceeds from repayment in full | $ 5,100 | |||||||||||||||||||||
Amount of mortgage loan secured by property, purchased by related party | $ 5,100 | |||||||||||||||||||||
ACM / Our "Former Manager" | Maturity date April 2018, extended from April 2016 | Mortgage loans | First mortgage | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Amount of mortgage loan secured by property, purchased by related party | $ 14,600 | |||||||||||||||||||||
Consortium of investors including an immediate family member of our officers | Fannie Mae loan on a multifamily property | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Percentage of maximum loss-sharing obligation unpaid principal balance | 5.00% | |||||||||||||||||||||
Principal amount | $ 46,900 | |||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 21.40% | |||||||||||||||||||||
Interest income recorded | 100 | |||||||||||||||||||||
Consortium of investors including an immediate family member of our officers | Fannie Mae loan on a multifamily property | Maximum | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Servicing revenue | $ 100 | |||||||||||||||||||||
Interest income recorded | 100 | 100 | ||||||||||||||||||||
Consortium of Investors, including our Chief Executive Officer and our Former Manager | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Amount invested | $ 2,000 | |||||||||||||||||||||
Ownership interest (as a percent) | 26.10% | |||||||||||||||||||||
Number of portfolios of multifamily properties | item | 2 | |||||||||||||||||||||
Certain officers, including our Chief Executive Officer and our Former Manager | Maturity date of September 2019 | Bridge loan, six multifamily properties | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 48,000 | |||||||||||||||||||||
Number of properties owned | property | 6 | |||||||||||||||||||||
Base spread (as a percent) | 4.50% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||||||||||||
Interest income recorded | 300 | 700 | 1,600 | 2,100 | ||||||||||||||||||
Number of bridge loans paid off | loan | 3 | 1 | ||||||||||||||||||||
Proceeds from repayment in full | $ 23,200 | $ 6,800 | ||||||||||||||||||||
Certain officers, including our Chief Executive Officer and our Former Manager | Maturity date of September 2019 | Bridge loan, six multifamily properties | Minimum | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 10.50% | |||||||||||||||||||||
Certain officers, including our Chief Executive Officer and our Former Manager | Maturity date of September 2019 | Bridge loan, six multifamily properties | Maximum | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 12.00% | |||||||||||||||||||||
Certain officers, including our Chief Executive Officer and our Former Manager | Maturity Date of October 2018 | Bridge loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Base spread (as a percent) | 5.00% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||||||||||||
Interest income recorded | 300 | 300 | 1,000 | 800 | ||||||||||||||||||
Number of mortgage loans secured by property purchased from related party | loan | 2 | |||||||||||||||||||||
Loan due from related party | $ 16,700 | |||||||||||||||||||||
Number of bridge loans paid off | loan | 1 | |||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity Date of January 2021 | Bridge loan, several multifamily properties | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Due to related party | $ 9,400 | |||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 75.00% | |||||||||||||||||||||
Base spread (as a percent) | 5.00% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 1.25% | |||||||||||||||||||||
Interest income recorded | 100 | 200 | ||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity Date of June 2021 | Bridge loan, one multifamily property | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 21,700 | $ 21,700 | ||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 75.00% | |||||||||||||||||||||
Interest income recorded | 300 | 400 | ||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity Date of June 2021 | Bridge loan, one multifamily property | LIBOR | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Base spread (as a percent) | 4.75% | 4.75% | ||||||||||||||||||||
LIBOR floor (as a percentage) | 1.25% | |||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of June 2020 | Bridge loan, several multifamily properties | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Due to related party | $ 32,800 | $ 32,800 | $ 32,800 | |||||||||||||||||||
Percentage of ownership after transaction | 90.00% | |||||||||||||||||||||
Base spread (as a percent) | 5.00% | 5.00% | 5.00% | |||||||||||||||||||
LIBOR floor (as a percentage) | 1.13% | |||||||||||||||||||||
Interest income recorded | 600 | 1,700 | ||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of fourth quarter 2020 | Bridge loan, two multifamily properties | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 28,000 | $ 28,000 | $ 28,000 | |||||||||||||||||||
Number of properties owned | property | 2 | 2 | 2 | |||||||||||||||||||
Percentage of ownership interest of related party in the entity | 45.00% | |||||||||||||||||||||
Base spread (as a percent) | 5.25% | 5.25% | 5.25% | |||||||||||||||||||
Interest income recorded | 500 | 1,600 | ||||||||||||||||||||
Number of bridge loans originated | item | 2 | |||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of fourth quarter 2020 | Bridge loan, two multifamily properties | Minimum | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
LIBOR floor (as a percentage) | 1.24% | |||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of fourth quarter 2020 | Bridge loan, two multifamily properties | Maximum | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
LIBOR floor (as a percentage) | 1.54% | |||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of July 2020 | Bridge loan, one multifamily property | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 36,000 | |||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 95.00% | |||||||||||||||||||||
Base spread (as a percent) | 4.50% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 1.00% | |||||||||||||||||||||
Interest income recorded | 700 | 400 | 1,900 | 400 | ||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of January 2019 | Bridge loan, two multifamily properties | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 12,700 | |||||||||||||||||||||
Number of properties owned | property | 2 | |||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 50.00% | |||||||||||||||||||||
Base spread (as a percent) | 4.50% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||||||||||||
Interest income recorded | $ 400 | 300 | 1,000 | 900 | ||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of January 2019 | Bridge loan, one multifamily property | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 19,000 | |||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 7.50% | |||||||||||||||||||||
Base spread (as a percent) | 4.50% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||||||||||||
Interest income recorded | 300 | $ 300 | 800 | |||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date November 2018, extended from May 2018 | Preferred equity investments | Multifamily | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Equity investment | $ 5,200 | |||||||||||||||||||||
Fixed rate of interest (as a percent) | 10.00% | |||||||||||||||||||||
Certain certain officers, chief executive officer, and other unaffiliated investors | Maturity date of November 2018 | Bridge loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 7.50% | |||||||||||||||||||||
Base spread (as a percent) | 4.50% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||||||||||||
Interest income recorded | 100 | 300 | ||||||||||||||||||||
Amount of loan to related party | $ 7,100 | |||||||||||||||||||||
Chief executive officer | Minimum | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Ownership interest allowed under company charter (as a percent) | 5.00% | 5.00% | ||||||||||||||||||||
Chief executive officer | Bridge loan, two multifamily properties | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Number of properties owned | item | 2 | |||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 95.00% | |||||||||||||||||||||
Base spread (as a percent) | 5.50% | |||||||||||||||||||||
Amount of loan to related party | $ 1,700 | |||||||||||||||||||||
Investments in equity affiliates | $ 100 | |||||||||||||||||||||
Ownership interest (as a percent) | 5.00% | |||||||||||||||||||||
Chief executive officer | Bridge loan, two multifamily properties | Maximum | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Interest income recorded | 100 | 100 | ||||||||||||||||||||
Chief executive officer | Maturity date of August 2017 | Bridge loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 24.00% | |||||||||||||||||||||
Amount of mortgage loan secured by property, purchased by related party | $ 30,400 | |||||||||||||||||||||
Chief executive officer | Maturity date of August 2020 | Bridge loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Base spread (as a percent) | 4.00% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 1.23% | |||||||||||||||||||||
Amount of mortgage loan secured by property, purchased by related party | $ 43,200 | |||||||||||||||||||||
Mr. Ivan Kaufman and his affiliates | Maturity date of August 2017 | Mezzanine loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Interest income recorded | 800 | |||||||||||||||||||||
Fixed rate of interest (as a percent) | 12.00% | |||||||||||||||||||||
Amount of mortgage loan secured by property, purchased by related party | $ 4,600 | |||||||||||||||||||||
Kaufman Entities | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Percentage of our Former Manager's outstanding membership interest of related party in another related party | 75.00% | 75.00% | ||||||||||||||||||||
Mr. Ivan Kaufman | Maturity date of August 2017 | Mezzanine loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Interest income recorded | 2,400 | |||||||||||||||||||||
Immediate family member of chief executive officer | Bridge Loan, several undeveloped parcels of land | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 17,700 | |||||||||||||||||||||
Percentage of ownership interest of related party in the entity | 10.80% | |||||||||||||||||||||
Interest income recorded | $ 300 | $ 300 | ||||||||||||||||||||
Fixed rate of interest (as a percent) | 10.00% | |||||||||||||||||||||
Lexford Portfolio | Preferred equity investments | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Income from equity affiliates | 700 | 700 | 1,900 | 2,000 | ||||||||||||||||||
Lexford Portfolio | Maturity Date of June 2021 | Bridge loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 280,500 | $ 280,500 | ||||||||||||||||||||
Interest income recorded | 4,400 | 5,500 | ||||||||||||||||||||
Maximum exposure under guaranty | 307,900 | $ 307,900 | ||||||||||||||||||||
Number of bridge loans originated | loan | 12 | |||||||||||||||||||||
Number of multifamily properties renovated | property | 72 | |||||||||||||||||||||
Number of one-year extension options | item | 2 | |||||||||||||||||||||
Lexford Portfolio | Maturity Date of June 2021 | Bridge loans | LIBOR | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Base spread (as a percent) | 4.00% | 4.00% | ||||||||||||||||||||
Ginkgo | Fannie Mae | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Loan purchased a multifamily apartment complex which assumed | $ 8,300 | |||||||||||||||||||||
Percentage of maximum loss-sharing obligation unpaid principal balance | 20.00% | |||||||||||||||||||||
Percentage of loan assumption fee | 1.00% | |||||||||||||||||||||
Percentage of ownership after transaction | 3.60% | |||||||||||||||||||||
Ginkgo | Maximum | Fannie Mae | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Servicing revenue | 100 | 100 | $ 100 | 100 | ||||||||||||||||||
Lexford Portfolio | Maturity Date of June 2021 | Bridge loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Unsecured financing provided by an unsecured lender to certain parent entities of the property owners | $ 50,000 | $ 50,000 | ||||||||||||||||||||
Lexford Portfolio | Consortium of affiliated investors | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Management fee, percentage of gross revenues of underlying properties | 4.75% | |||||||||||||||||||||
Two portfolios of multifamily properties | Consortium of Investors, including our Chief Executive Officer and our Former Manager | Maturity date of November 2018 | Bridge loans | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Principal amount | $ 14,800 | |||||||||||||||||||||
Base spread (as a percent) | 5.25% | |||||||||||||||||||||
LIBOR floor (as a percentage) | 0.50% | |||||||||||||||||||||
Interest income recorded | $ 300 | $ 300 | $ 800 | |||||||||||||||||||
Number of bridge loans originated | item | 2 | |||||||||||||||||||||
Ginkgo | Director | ||||||||||||||||||||||
Agreements and transactions with related parties | ||||||||||||||||||||||
Percentage of managing member | 33.00% |
Segment Information - Statement
Segment Information - Statements of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Segment Information | ||||
Interest income | $ 67,500 | $ 42,140 | $ 178,408 | $ 110,133 |
Interest expense | 39,548 | 23,850 | 110,819 | 63,698 |
Net interest income | 27,952 | 18,290 | 67,589 | 46,435 |
Other revenue: | ||||
Gain on sales, including fee-based services, net | 17,451 | 17,126 | 51,266 | 55,127 |
Mortgage servicing rights | 25,216 | 18,897 | 62,787 | 56,182 |
Servicing revenue | 26,082 | 20,231 | 70,301 | 55,350 |
Amortization of MSRs | (11,838) | (11,711) | (35,639) | (35,427) |
Property operating income | 2,651 | 2,668 | 8,525 | 8,755 |
Other income, net | (3,982) | 778 | (1,574) | (931) |
Total other revenue | 55,580 | 47,989 | 155,666 | 139,056 |
Other expenses: | ||||
Employee compensation and benefits | 27,775 | 25,194 | 84,084 | 66,861 |
Selling and administrative | 9,994 | 7,607 | 27,783 | 23,136 |
Property operating expenses | 2,437 | 2,583 | 8,089 | 7,843 |
Depreciation and amortization | 1,848 | 1,829 | 5,539 | 5,542 |
Impairment loss on real estate owned | 2,000 | 2,700 | ||
Provision for loss sharing (net of recoveries) | 2,019 | (2,617) | 2,840 | (405) |
Provision for loan losses (net of recoveries) | 836 | 2,000 | (967) | (457) |
Litigation settlement gain | (10,170) | (10,170) | ||
Management fee - related party | 6,673 | |||
Total other expenses | 34,739 | 36,596 | 119,198 | 111,893 |
Income before extinguishment of debt, income (loss) from equity affiliates and income taxes | 48,793 | 29,683 | 104,057 | 73,598 |
(Loss) gain on extinguishment of debt | (4,960) | (4,960) | 7,116 | |
Income from equity affiliates | (1,028) | 996 | 1,104 | 1,756 |
Benefit from (provision for) income taxes | (5,381) | (6,708) | (1,096) | (16,244) |
Net income | 37,424 | 23,971 | 99,105 | 66,226 |
Preferred stock dividends | 1,888 | 1,888 | 5,665 | 5,665 |
Net income attributable to noncontrolling interest | 7,799 | 5,662 | 22,347 | 16,597 |
Net income attributable to common stockholders | 27,737 | 16,421 | 71,093 | 43,964 |
Operating segments | Structured Business | ||||
Segment Information | ||||
Interest income | 61,232 | 37,259 | 162,645 | 95,685 |
Interest expense | 35,508 | 19,913 | 100,324 | 51,866 |
Net interest income | 25,724 | 17,346 | 62,321 | 43,819 |
Other revenue: | ||||
Property operating income | 2,651 | 2,668 | 8,525 | 8,755 |
Other income, net | 406 | 540 | 757 | 1,381 |
Total other revenue | 3,057 | 3,208 | 9,282 | 10,136 |
Other expenses: | ||||
Employee compensation and benefits | 6,683 | 5,670 | 21,019 | 13,570 |
Selling and administrative | 4,465 | 3,014 | 11,500 | 8,993 |
Property operating expenses | 2,437 | 2,583 | 8,089 | 7,843 |
Depreciation and amortization | 447 | 429 | 1,338 | 1,341 |
Impairment loss on real estate owned | 2,000 | 2,700 | ||
Provision for loan losses (net of recoveries) | 836 | 2,000 | (967) | (457) |
Litigation settlement gain | (10,170) | (10,170) | ||
Management fee - related party | 3,259 | |||
Total other expenses | 4,698 | 13,696 | 32,809 | 37,249 |
Income before extinguishment of debt, income (loss) from equity affiliates and income taxes | 24,083 | 6,858 | 38,794 | 16,706 |
(Loss) gain on extinguishment of debt | (4,960) | (4,960) | 7,116 | |
Income from equity affiliates | (1,028) | 996 | 1,104 | 1,756 |
Benefit from (provision for) income taxes | 500 | |||
Net income | 18,095 | 7,854 | 35,438 | 25,578 |
Preferred stock dividends | 1,888 | 1,888 | 5,665 | 5,665 |
Net income attributable to common stockholders | 16,207 | 5,966 | 29,773 | 19,913 |
Operating segments | Agency Business | ||||
Segment Information | ||||
Interest income | 6,268 | 4,881 | 15,763 | 14,448 |
Interest expense | 4,040 | 2,975 | 10,166 | 8,946 |
Net interest income | 2,228 | 1,906 | 5,597 | 5,502 |
Other revenue: | ||||
Gain on sales, including fee-based services, net | 17,451 | 17,126 | 51,266 | 55,127 |
Mortgage servicing rights | 25,216 | 18,897 | 62,787 | 56,182 |
Servicing revenue | 26,082 | 20,231 | 70,301 | 55,350 |
Amortization of MSRs | (11,838) | (11,711) | (35,639) | (35,427) |
Other income, net | (4,388) | 238 | (2,331) | (2,312) |
Total other revenue | 52,523 | 44,781 | 146,384 | 128,920 |
Other expenses: | ||||
Employee compensation and benefits | 21,092 | 19,524 | 63,065 | 53,291 |
Selling and administrative | 5,529 | 4,593 | 16,283 | 14,143 |
Depreciation and amortization | 1,401 | 1,400 | 4,201 | 4,201 |
Provision for loss sharing (net of recoveries) | 2,019 | (2,617) | 2,840 | (405) |
Management fee - related party | 3,414 | |||
Total other expenses | 30,041 | 22,900 | 86,389 | 74,644 |
Income before extinguishment of debt, income (loss) from equity affiliates and income taxes | 24,710 | 23,787 | 65,592 | 59,778 |
Benefit from (provision for) income taxes | (5,381) | (6,708) | (1,596) | (16,244) |
Net income | 19,329 | 17,079 | 63,996 | 43,534 |
Net income attributable to common stockholders | 19,329 | 17,079 | 63,996 | 43,534 |
Other / Eliminations | ||||
Segment Information | ||||
Interest expense | 962 | 329 | 2,886 | |
Net interest income | (962) | (329) | (2,886) | |
Other expenses: | ||||
Income before extinguishment of debt, income (loss) from equity affiliates and income taxes | (962) | (329) | (2,886) | |
Net income | (962) | (329) | (2,886) | |
Net income attributable to noncontrolling interest | 7,799 | 5,662 | 22,347 | 16,597 |
Net income attributable to common stockholders | $ (7,799) | $ (6,624) | $ (22,676) | $ (19,483) |
Segment Information - Balance S
Segment Information - Balance Sheet (Details) - USD ($) $ in Thousands | Sep. 30, 2018 | Dec. 31, 2017 |
Assets: | ||
Cash and cash equivalents | $ 92,598 | $ 104,374 |
Restricted cash | 202,736 | 139,398 |
Loans and investments, net | 3,097,689 | 2,579,127 |
Loans held-for-sale, net | 500,281 | 297,443 |
Capitalized mortgage servicing rights, net | 259,401 | 252,608 |
Securities held-to-maturity, net | 50,520 | 27,837 |
Investments in equity affiliates | 22,101 | 23,653 |
Goodwill and other intangible assets | 117,565 | 121,766 |
Other assets | 191,369 | 79,739 |
Total assets | 4,534,260 | 3,625,945 |
Liabilities: | ||
Debt obligations | 3,355,869 | 2,531,236 |
Allowance for loss-sharing obligations | 33,405 | 30,511 |
Other liabilities | 178,514 | 199,642 |
Total liabilities | 3,567,788 | 2,761,389 |
Other / Eliminations | ||
Liabilities: | ||
Debt obligations | 50,000 | |
Other liabilities | 1,009 | |
Total liabilities | 51,009 | |
Structured Business | Operating segments | ||
Assets: | ||
Cash and cash equivalents | 45,001 | 37,056 |
Restricted cash | 202,736 | 139,398 |
Loans and investments, net | 3,097,689 | 2,579,127 |
Investments in equity affiliates | 22,101 | 23,653 |
Goodwill and other intangible assets | 12,500 | 12,500 |
Other assets | 172,078 | 66,227 |
Total assets | 3,552,105 | 2,857,961 |
Liabilities: | ||
Debt obligations | 2,863,266 | 2,189,700 |
Other liabilities | 140,662 | 155,814 |
Total liabilities | 3,003,928 | 2,345,514 |
Agency Business | Operating segments | ||
Assets: | ||
Cash and cash equivalents | 47,597 | 67,318 |
Loans held-for-sale, net | 500,281 | 297,443 |
Capitalized mortgage servicing rights, net | 259,401 | 252,608 |
Securities held-to-maturity, net | 50,520 | 27,837 |
Goodwill and other intangible assets | 105,065 | 109,266 |
Other assets | 19,291 | 13,512 |
Total assets | 982,155 | 767,984 |
Liabilities: | ||
Debt obligations | 492,603 | 291,536 |
Allowance for loss-sharing obligations | 33,405 | 30,511 |
Other liabilities | 37,852 | 42,819 |
Total liabilities | $ 563,860 | $ 364,866 |
Segment Information - Originati
Segment Information - Origination Data (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2018 | Sep. 30, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Segment Information | ||||
Origination Volumes | $ 1,376,376 | $ 928,181 | $ 3,499,569 | $ 3,181,367 |
Loan Sales Data: | ||||
Sales margin (fee-based services as a % of loan sales) | 1.47% | 1.63% | 1.57% | 1.52% |
MSR rate (MSR income as a % of loan commitments) | 1.83% | 2.04% | 1.79% | 1.77% |
Structured Business | ||||
Segment Information | ||||
New loan originations | $ 287,480 | $ 473,171 | $ 1,208,550 | $ 1,057,004 |
Loan payoffs / paydowns | 255,575 | 270,010 | 684,216 | 723,977 |
Agency Business | ||||
Segment Information | ||||
Origination Volumes | 1,411,064 | 996,722 | 3,500,182 | 3,307,874 |
Loan Sales Data: | ||||
Loan Sales | 1,190,004 | 1,052,073 | 3,270,723 | 3,621,276 |
Fannie Mae | Agency Business | ||||
Segment Information | ||||
Origination Volumes | 995,662 | 650,374 | 2,264,870 | 2,216,820 |
Loan Sales Data: | ||||
Loan Sales | 867,601 | 665,960 | 2,175,846 | 2,569,821 |
Freddie Mac | Agency Business | ||||
Segment Information | ||||
Origination Volumes | 317,516 | 328,075 | 1,060,456 | 880,597 |
Loan Sales Data: | ||||
Loan Sales | 286,423 | 342,630 | 974,551 | 862,376 |
FHA | Agency Business | ||||
Segment Information | ||||
Origination Volumes | 77,236 | 18,273 | 137,973 | 189,087 |
Loan Sales Data: | ||||
Loan Sales | 15,330 | $ 43,483 | 83,443 | 167,709 |
CMBS/Conduit | Agency Business | ||||
Segment Information | ||||
Origination Volumes | 20,650 | 36,883 | 21,370 | |
Loan Sales Data: | ||||
Loan Sales | $ 20,650 | $ 36,883 | $ 21,370 |
Segment Information - Key Servi
Segment Information - Key Servicing Metrics (Details) - Agency Business - MSRs - USD ($) $ in Thousands | 9 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2017 | |
Segment Information | ||
UPB of Servicing Portfolio | $ 17,794,681 | $ 16,206,315 |
Wtd. Avg. Servicing Fee Rate (basis points) | 0.462% | 0.477% |
Wtd. Avg. Life of Servicing Portfolio (in years) | 8 years 9 months 18 days | 8 years 1 month 6 days |
Fannie Mae | ||
Segment Information | ||
UPB of Servicing Portfolio | $ 13,195,643 | $ 12,502,699 |
Wtd. Avg. Servicing Fee Rate (basis points) | 0.523% | 0.536% |
Wtd. Avg. Life of Servicing Portfolio (in years) | 7 years 8 months 12 days | 6 years 10 months 24 days |
Freddie Mac | ||
Segment Information | ||
UPB of Servicing Portfolio | $ 3,977,619 | $ 3,166,134 |
Wtd. Avg. Servicing Fee Rate (basis points) | 0.308% | 0.295% |
Wtd. Avg. Life of Servicing Portfolio (in years) | 11 years | 10 years 6 months |
FHA | ||
Segment Information | ||
UPB of Servicing Portfolio | $ 621,419 | $ 537,482 |
Wtd. Avg. Servicing Fee Rate (basis points) | 0.157% | 0.165% |
Wtd. Avg. Life of Servicing Portfolio (in years) | 20 years 1 month 6 days | 19 years 7 months 6 days |