BRSP BrightSpire Capital

David Palame General Counsel
Mike Mazzei President and CEO
Andy Witt COO
Frank Saracino CFO
Stephen Laws Raymond James
Randy Binner B. Riley
Tim Hayes BTIG
Steven Delaney JMP Securities
Call transcript
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Greetings. Welcome to Colony Credit Real Estate, Inc. Fourth Quarter 2020 Earnings Call. At this time, all participants are in listen-only mode. A question-and-answer session will follow the formal presentation. this being note, Please instructions] conference recorded. is [Operator over host, David now turn General your conference the I’ll Palame, to Counsel.

You may begin.

David Palame

Good Real Estate, year to Colony quarter welcome call. full conference XXXX afternoon, and earnings Inc's and fourth Credit

We Colony Real throughout CLNC, this will Inc. the Credit Credit refer Real Estate, Colony Estate, to as or call. Colony company Credit

Frank on call today Witt; Chief Mazzei; Mike Officer, Officer, the are Andy and Speaking Chief Chief and Saracino. Officer, Financial Executive the company's Operating President

note current that risks contains risks, associated effect adverse please materially, this are Before call, statements company's presented heightened I call, and assumptions. and of hand to information on forward-looking the differ cause including are business certain the the COVID-XX. Potential subject can and with risks uncertainties based expectations and potential These uncertainties to statements. financial on management's and results

that in update of section other results, For statements forward-looking of risks current circumstances. filed from most with see information intend Factors call risk today, future recent discussed of our a as could XX-Q and and on XX, SEC duty time or and periodic All XXXX, the the and is no to company undertakes Risk events reports affect discussion company's February does to factors please and the not this the for time.

Mike Mike? now, the Real on earnings financial investors. available certain financial of is supplemental of Chief and release presentation, the company's company's non-GAAP believes represents afternoon non-GAAP appropriate are which measures reconciliations useful call The and Mazzei, I'd to the addition, Estate. In Executive released and measures to And Credit measures. company Officer information like presented call website, on financial explanation an GAAP President was Colony this turn why over presents this the to and to such

Mike Mazzei

us as company's us team, past front the say today. been the thanks support professionally. thank the of wishing Thank the who our extend quarter joining also Welcome pandemic. providing call. to Officer. different employees both like welcome you and everyone I'd on challenging to well many I meet you, to and his face has much our accomplished this CLNC On I for the XX behalf and rising the our least. by to to said, lines personally care to Chief are like time. challenges earnings for dedicated Frank the have I'd all of We Saracino call to Financial CLNC earnings David. months of team That they during those fourth also start first thank These

First, solidifying the balance dramatically $XXX reducing today. million liquidity, debt sheet stands at increasing by and which

accomplishments non-strategic substantially have repo Specifically, securities CMBS accounts all of legacy has, fully corporate less lines, portion securities for off revolver. our portion our Further, reduced our we for the as been portfolio an paid finally, our total highlights With at the CMBS quarterly has than portfolio and intents the holdings X% new now like the purposes of book originating at these of fees growing some for to key we cover that, fourth financial loans earnings. And have culmination resulted share a value. of ceiling net of quarter. and I'd now dividend. all as LNS of well the have and The begun in reinstatement resolved. immaterial

$X.XX of GAAP had a quarter, the and loss and respectively. $X.XX we cents distributable For per share

value million position respectively. was and generated adjusted per underappreciated and $XX.XX we a $XXX GAAP of losses gains other and fair At $X.XX our yearend distributable was CLNC's approximately and unrestricted per share. share. value and end total cash $XX.XX realized earnings or Furthermore, adjustments, $X.XX Excluding company book share year

business, transition asset rate our to executing base first plan we towards Now, floating are turning our mortgages. to the on

loans mid Since committed $XXX million September, dramatically. increased loans, of with has activity $XXX commitment in some our origination of total in to which CLO, and originations loan million XX closing these mortgage are additional closed loans $XXX as reinvestment of utilize of this in the our may we the be a in current end nine replacements loans commencing have should new there pipeline, commitments have loan an such, payoffs October. date million. We As representing prior we new period with total

on nine generating time, a second our Beyond to overall year. lack we reshape portfolio. market slowed enough our continues this have by sector. the loan of that, issue selective we hospitality in asset order property. in deliberately driven notably, the both office This At conditions of later by number COVID-XX has this a have sales originations anticipate production multifamily considerably. our CLO and focused been property in In There timeline months, also classes, the visibility and to investment our be most last desire to recovery created

centers sector has retail forward and In box property the incurred lasting of viewed overall properties. anchored than favorably addition, less malls the grocery big damage eCommerce with from pull

these estate and many while on For industrial have as supply and property as select office especially and capital focused imbalance credit there a while a across mismatch Most market, retail multifamily, on reasons, being sectors. is properties real reentered hospitality. are well lenders hesitant the for commercial demand lenders

But see increase lead refinancings offset to loan could property acquisition half activity of increasingly to second Over improve, XXXX will the other Therefore, to the positive an selectively this, in term, to economic competitive its expect we a conditions to expand market. as originations as economy CLNC reopen. the types. as near this we continues loan and imbalance lending

Another positive side of the is liability sheet. on balance the

the us economic market environment. to in loan pricing, about in on advance funding XXXX, model have type of CLNC's securities we income abreast Also, liability Overall, maintain of strengthening rates. the with equity. are costs improving allow in continued This improvement on Here floating both our preference coupled with counterparties bonds. rate satisfactory should expansion this fixed by been business operating returns expected optimistic we by bank their driven see keeping CLO increased investors for continued and for demand

improved dividends to cornerstones to we CLNC books months, our continuing that continues our to recent recognize while improve at obvious share earnings in trade valuation. discount our are a Finally, and to Building value. prices growing

sought In end, number addition, added In a own of provide have this team additional But and estate XXXX year. we more in has to on key this summary, we with our investors some loans to assets enhance further form was filing. real some accomplishments. disclosures our information information. the of CLNC challenging have a XX-k made quarters To

the company's sheet, our begun new stabilized legacy the dividend. behind us, and non-strategic origination, put have reinstated We build earnings loan portfolio commenced balance to

of The effects our for call, woods. months. of earnings in said quarter yet will continue we COVID-XX I as However, third out many are not the

to thank recognize many We for resulted my counterparties pandemic lives, our and teamwork our have also Therefore, cooperation. aspects colleagues again from that the permanent. in and of that certain be their I want may changes

in liability We continued built will team management, the cash. redeploying over while asset which like to momentum vigilant call into that, Witt. continue Operating great has and Andy I'd Chief XXXX. to to remaining prudently The this Andy. the by our balance has With turn sheet protect CLNC Officer, year, past our

Andy Witt

earnings. liability a portfolio, end. well focus everyone. as The and the real reserves, on new There portfolio quarter as of More which is and loans. performance were Across core existing interest Thank borrowers This XX% building and expected and as pocket resolve portfolio support fourth throughout loan continues portion modification come that the were some and well one collected specifically, payments received. asset was to of afternoon, excludes core during be good estate sold we their a and for as loans their total payments partial to remained quarter. of XX% portfolio, loans, confined expected management working to The which figure strong. some collection required loan, liquidity you, of to origination quarter net limited cash one subsequent is we equity. the leased which big currently loan of to core uncollected of form are cash number out Mike

lease a assets borrowings, off throughout remains investment the The real to The which sold the net net is corresponding mentioned Within resolving as during present million. quarter collected proceeds. million quarter, our the on to realized portion gross quarter. proceeds gain $XX we Subsequent million XX% confined of portfolio, core which relates a core of are in generating delinquent gain. were book loans sale well in of the book GAAP of end. it $XX $XXX million $XX to Lastly, the industrial all million portfolio closed previously of company we and holdings. quarter portfolio the to paid lease net value end, on as positions, level subsequent CMBS totaling for $XX estate value certain payments during expected core portfolio, a loss CMBS as the approximately the fourth process of undepreciated portfolio, core we of lease estate related to resulting portfolio real we sales nine net Core within our a sold quarter current loan [ph] At

million In reexamining the Auckland aspects which has and carrying series recorded timeline, the the share project. related pandemic the projects business of a our in resulted mortgage $X.XX necessitated delays associated in During down. these fair of $XX Dublin value value The delays or we market our adjustment fourth various Ireland, of per judgment quarter, resulted to plan a loan. in write

which filings will as in well investment filed be tomorrow. and this Additional XX-K, as past in disclosure on available form others the quarterly are

as at from our loan Lastly, October LIBOR it perform to continues core level. and portfolio, in XXXX to billion dollar the underlying benefit executed CLO the relates managed floors

of for non-strategic well the company within hospitality on resolving We segment. stress office course the developments manage payoffs continue the activities portfolio; COVID-XX example, legacy loan to up both ordinary the to and assets Shifting as the performance trust made CLO. progress has monitor the related and considerable for as lease

is the sales at present, of an positions less sales This of fourth of XX, share than of million company down This from after for December comprised through costs. the as XXXX today, the is gross transaction GAAP resulted quarter resolved value the and the investments net book book LNS million now and and for sold $XX aggregate $XXX portfolio During XX remaining XX of of in portfolio value a price million. At $X accounts net LNS XX position. our loss with X% LNS or price initially, XXXX.

given sheet of reporting, address first XXXX recording segment, the basis. company related the decision on the its combined majority and Additionally, on we total closing, and to will limited to liquidity the relative focused a manage generating COVID-XX resources for balance collapse portfolio the our and the managing to size review with potential In XXXX, beginning demands. business quarter our LNS its

totaling multifamily and September, building earnings. XX the million. committed toward make progress focus XX liabilities, to of which mid managing While are company to continuing Since meaningful are on $XXX assets to begun has we loans,

into is As we over capital transforming of with high composition focus quality on fourth elaborate our consistent mortgages by and With I the stated predictable continue Saracino to generating results. our deploy on turn to to portfolio Chief mortgages, first sponsors, Frank assets current earnings. Officer, call secured and first our Financial plan the quarter to that, the will business

Frank Saracino

Andy and you, everyone. good Thank afternoon,

and our our fourth would supplemental discussing our also further draw all supplemental which to Form financial report, by our like website. the for in that Andy to I as results, attention mentioned includes quarter XXk about as and Before Furthermore, be receipts filed note detail holdings on in January your which we to will that continue tomorrow portfolio financial February I available Form well would XXK. information asset is remarks. our report, his core interest in our asset provide rent

I a as have has which quarter we this disclosed to renamed assess measure comment earnings, that distributable to performance been and GAAP Historically, be we briefly only earnings calculate we on not an change this We net is that name the non-GAAP this business. core addition earnings in to would to important like metric income how of our financial starting Additionally, a financial core metric. our clear change earnings. use in want

certain this of adopt our name mortgage what that REIT this over change non-cash dividends. ability descriptive this represents, the is pay of making items following to terminology measurement the and several SEC between months. past the The are the anchored change aligns with industry more and GAAP purpose results in company's for to a is that discussions metric adjusted We of

$XX.X fourth reported per shareholders quarter quarter million that, quarter results. anticipate a between long will GAAP payments, let's we may be over to our million CLNC With XXXX earnings $X.XX differences fourth $X.XX from and be share. or net distributable to loss per to quarter correlated our While total that they of loss of the highly dividend turn company term. a distributable common share, $XX.X and or attributable there

losses share. company adjustments, $XX.X and and $X.XX value per and total fair or distributable adjusted other were gains earnings Excluding

During $XX.XX $XX.XX and This GAAP from to per company our is value share the book value to loan. adjustments $XX.XX decreased fourth net project undepreciated the share. $XX.XX to primarily per due quarter, total to book change fair decreased from value

As taxable market are performance the dividend. mentioned pandemic the on May of we XXXX, conditions is call, reinitiating cash distribution at the $X.XX unprecedented the payable XX. monthly our of monthly record company's top that for quarter of company XX, per in also as to liquidity for outlook, maintain of we the of to in XXXX were for we pandemic, a position, dividend status shareholders To that a Today CLNC's our prior the and with yearend REIT the paid like preserve and dividends based the the of as financial from the I requirements This XXXX. March suspended met minimum volatility light would declared arising April to first dividend. operational XXXX. business improved on its income share and to quarterly note

loan with blended geography, loan of core book, average Furthermore, of with value loan book be The portfolio carrying of to segment and million. the the largest unlevered type loan office multifamily our our to is at year focus $X.X diversified properties. on approximately approximately continues a with on terms an in X.X% billion size, a yield Turning $XX size this collateral and remains end.

our term the investment overall legacy years. flows The due the of we at lease quarter, weighted with for million and and carrying within property $XXX we strategy non-strategic net of GAAP of Yearend substantial our initial loans consists lease to core portfolio, $XXX end, of long addition portfolio. capital stable portfolio, approximately This gross value the this With originated Also an million net-book to a term they lease assets provide, four million gross senior fourth loans end. progress part to appreciation. During of initial our $XXX value portfolio of to a core had year year net five estate of is our in we originated funding for for office loan portfolio. potential respect have immaterial the made real year funding. total subset now the subsequent X.X last industrial of of resolving over cash average

Andy will segment, our As and quarter be LNS last this mentioned, reporting reporting simplify the our will this forward. going

our our at to XXXX. $X.X XX, of Moving sheet, balance stood total approximately billion at share assets December as

credit on stands availability facility. exposure have we $XXX substantially our between from Our times revolving the million debt assets fourth and quarter $XXX. end third the of recourse of the $XXX the to $XXX of debt our debt to down million This cash was Current net XXXX Since the million. from liquidity reduced million XX% at equity at is to ratio end at times XX% X.X first quarter. was and X under hand approximately at Navy quarter. of ratio X.X

risk the of risk quarter the remained with overall fourth at end our ranking, third of to quarter. that ranking consistent the relatively Turning

at is Our to compared fourth quarter the ranking third the end quarter. risk X.X of X.X

increased driven loans. primarily that, reserves The end compared prepared the This which Operator? at third is quarter. open loans. macroeconomic offset fourth of X.X% a $XX.X difference as million our with long-term on by provision to remarks our questions. our the $X.X was the of was Cecil concludes decrease and an hospitality for reserve and quarter, outlook, call million slight against the represents This Finally, partially improved let's by is our approximately


with Stephen will session. first Our conducting your question be with proceed this instructions] from [Operator James. Please Laws a is question. time, we Raymond question-and-answer At

Stephen Laws

touched you Hi, for target and if later I good for outlook aggregating afternoon. you wondering this. Mike, mentioned Frank on maybe you guess can prepared touched both on portfolio year. the loans, you CLO senior but comments, more this growth, quantify

the CLO either senior And loan the portfolio? loan how get How, financing see how just do assets? total of two mix leverage big as of to to a do then target kind So of question. part I expect or guess, portfolio you

Mike Mazzei

we the done. mortgage I are will think the that that loans senior more be portfolio, want do of loans we to repositioning

in can million September. loans of You XX done see XXX commitments that we've since

So at we're pretty rate. run good a

financing totally answer not directly do a in your year, as a and a to maybe to get billion The it's So model. CLO able billion loans it's to is, -- question dollars this do to the doable over We there? originations half. are use question want we

it we to if can CLO. those CLO But we One, loan how things one, it that XX% like a we get depends we're couple depends that we'd want So grow, do increase a We where vehicle. we we now to CLO that roughly Stephen. on a and ROEs done. can repayments think probably in second do ROEs of getting, maximize right big on have

the in prepared reinvestment October an horizon said I As this remarks, is year. there

pay in in that we've that But some had we've already, use pay October. So between the with where replenish loans off if portfolio. have loans the was in placed now that any payoffs loans, to had more them of the some some and we CLO collateral loans new we may CLO we off

timing could that second affect the a So of CLO.

the affect defend to can cash that the a balance CLO thing raised for other sheet. cash. beneath reason We is the The

to said, have to I want future. adequate to have assets of we that deliver not make hand understand move we're de-levering sure we those out As should on on to need potentially funds the assets sheet sure around We yet the the what in and make assets. trying we woods we're that balance may

sheet balance and are terms things speed doing growing the our a to could that those affect two CLO. second the of So in market

Martin I difficult. your from slightly side are [ph]. those to appreciate So

like those do possible, we is, dollars would at and we mixed possible because now. in some like that's took the to and then to the would The LA use monetize repatriate other project down for those assets project on point like just some those if that dead right if we earning money have write add that and the instance, non cash we basically Ireland thing repatriate that reinvest I'd

So answers there number I a that are here. parts of your question. hope moving

Stephen Laws

It that any kind the able next of assets reallocate color you be might of around to those when and up, two capital. does timing were

Mike Mazzei

actively hotel, in this what hotel It's don't us So much information instance, we balance number, it how public don't there and will just over the shareholders, closings we’ll need have our six the that versus beginning the months number positions, basically a update plumbing the bit be the have the little I of has the going then hotel, With the could for near-term I around, we're today. the sure and on of of that substantial out But cash at I hand. understand some is can end mention think and to on that LA delivered cash it's cash, moving timing reallocating hotel is like the the And portfolio, that's those at And is be is the things. might over million if hands next $XXX manage just has do more and hotel the some work. that to to we a to be any managing on mean condos, that non-earning closings. on that is the trying to be filing. I it But might the some received project by sheet through the for but exactly assets may passive TCL, be actually still its been the all than the cash know the the day, of want not on manager. make to know XX-K our in business wanted completed. that open way, to has operator been don't mixed-use, but hotel our I regard. LA assets, that, in we mixed-use control. It developer regard

the the I process will I very owner on and developer biggest at or outcome that whether regard do were a of operator the I hotel. be a that sells believe shortly, were And there be. will if those the used to the are commences think be you much tell our of debt, position this hotel liquidity position but not marketing to that that proceeds in that with position of monetize, much the can't or out will what sell, thing to hotel the senior would it to things the pay put control point. more are down But our the favorable

With that COVID. we in delays project of Ireland, because had the on substantial

estate people are As new not CEOs deals, rushing big real imagine, you leases. to can ink and facilities and sign

the been an there's up project. anchor tenant regarding So for signing delay there

at up by And to so types and of think sensitize And deals. the some of that. it on ran substantially markdown looked hurt we which time COVID. with we delays, that, does we a I driven And are outcomes because various came

that Capital. we're there asset. co-lending possible it, in balance dead something on Colony But control. could them. earning our we're regard. but that the affiliate in not it's totally focused from it’s So much, a be with we sheet of a our XXXX can money And It's non very with that discuss monetization a on that very And position as that's

Stephen Laws

about and you for. was lastly, guys about, little that talk dividend arrive that think I above you dividend can can at ramps-up? quarterly And to you How did bit was looking grow policy a forward? policy it's portfolio now something about the looking the how going what you. $X.XX revisited do is forward, you level annually But Got you'll moving be the is talk as the

Frank Saracino

is this you. answer Sure, I'll Frank,

capital from with established and Mike was as and loans deploy deploy non-accrual performing a look sustainable So our and said. it at view level a cash as we towards repatriate our growing dividend

it be a on visited quarter-by-quarter yes will basis. So,

Stephen Laws

color Appreciate this the Great, evening. Thanks.

Frank Saracino

you. Okay, thank


with from your question B. you’re is Riley. Our Binner Please question. next proceed Randy

Randy Binner

just bit the A good you. I'm information, evening. on good a Thanks. Hey, some little thank kind summarize to adjustments. lot it credit of trying of of

still And Is fair? then fair the to the exiting relatively odd due Dublin were just million. gains realized the in XX was gains, and that value, mark smaller, CMBS. project, mostly is the the primarily the that it’s on from some So

Mike Mazzei


Randy Binner

of and Okay, that to had portfolio the the I and of else be delevered. what allocation, depends cash timing mentioned need CLO on then, so might the and guess kind you Mike, in

look guess to kind number should deck it five slide I of at I'm turn X.X? the more the that seems with in that indicator on this, all format, be, conjunction next loans what out be So XX-K, things to think what leading of category this in that lay kind in about before be the originating CLO that just might of you the trying need kind would is of clearly we in positive where this

Mike Mazzei

million right, all five, let's they're total about piece CMBS think about Dockland’s earning, we’ll in a that, of the other couple say it's bucket, All we have there's not have loans bond of of and retention of in sell a which that's we can we hold. assets, that the underperforming risk Century $XXX I some,

that the of on cash, said do XX in $XXX pocket we we just his have and you loans. some a million that remarks, that watchful loans of that we as add, is its we work. are put out math a I can we So today, coming just could we are really rest where to repatriate XX The have on put have borrowers could mean, eye. that, prepared it have Andy performing can if that a to or and

require generally service. behind. scraping that if industry, lease-up, heavily together borrowers are the assets have substantial you industry to that the those And those in have or business you loans, across transitional in portfolio, plans hotel make think are everyone's I generally

of loans have Some reserves had that we've these been, repurpose.

we the cash that have today. have of that money $XXX that performing around. of those move we are to that you we assets be, might So what why cash idea have ready raised. have might mindful million was to universe have That's the to be loans But we an have, of a

know we about to to We loan default. to, eye watchful of have moving a road assets off the we But we CLO that. for of out don't that So down warehouse don't have or have that. facilities, worry have the should

to deploy against So sure cash, have protect those on headwinds, cash we make to balance those. the the we check are hedge to need enough as have we sheet a

So be from cash now, right do right have. September. that could $XXX done the as now a loans since math, deploying you out could what million cold we’re of $XXX And stop starting the and a we've we in million

balance pay-off, with the depending can, cash that depending that utilize the on impossible one how not right we to agree the that on hand can needs again, have need cash we we at double our do what if it's protect know much So we're on times, with do to all we're going loans but going and would you to elsewhere, sheet. the CLO

came said third in the price. earnings capital quarter call, I As raising a this at

to defend want balance we have we're sure have sure to as we the deploy so we we And it, back sheet. to enough going that make capital, don't to go to make more raise

Randy Binner

that, The $XXX the million, But lot being a CLO if than as That's a variables. obviously to bigger you X.X, so way helpful. think of really there's it nice one? think the of first

Mike Mazzei

second be the say XX would necessarily reinvested I multifamily. to get are wait mean second CLO, hit pay-off that do we CLO, by to loans We're the out I doing, Andy in long doesn't when way, smaller Andy that of XX think that the want market we CLO said, first the and as loans than first. by say October would the could sooner. that could I And the the

Andy Witt

yes. has in deployment about multifamily. XX% of Correct, been It’s the

Mike Mazzei

originating might spreads originated of what giving and give the this been of it's got like, give different do size, I configuration portfolio, lend better the loans be on we've loan smaller, statistics that CLO Andy no itself a we've we've little you the Andy? a it think And average look Right. retail. you've worth might to few much a And because Andy, that what hotel, no coupons been second should synopsis getting a can and the feel

Andy Witt


since refinanced of originated we Of in the XX% over originating million have nine put about loans we or $XXX been closed. loans, XX multifamily. So have that September, in to work

been has $XX other in approximately The three average size loan office, the million.

the So focused that one size. of the on is things of loan now we're the dispersion

any getting not much one exposure So position. too to

really is between $XX $XX million million. dispersion the So and

terms that's rate cost with a In of the line of and we're seeing rates, our advance of rough kind X% generating all-in approximately and XX% ROE. funds

increase view CLO ROE. our to move loans into those So a is and that potentially

Randy Binner

That’s suburban Like at where or is present? super office? office working what's the it helpful, is somewhere

Mike Mazzei

targeted non-gateway, MSA we be tenancy, area, we it's major office, very suburban deals market it's that a office it's the it well, like and a we very the in Yes, a like might like. where

gives I the seeing Andy think So kind of loan smaller. select. that when we've size the been rundown you you But very is average

And that’s the $XXX avoid give a scoring good risks the could a right the do so and and agencies execution million to you on and concentration good from rate advanced get the deal. deal you

So don't to from franchise issuance We the running. wait some your there's get the to cost. to try ground hit do get billion, would could. earlier think But a scale probably now value. But $X we think want I you we hit we if think better of would I economies window to

than of assets. value franchise to some firm the incremental rather second for put wait for that its there’s think I CLO million $XXX

Randy Binner

Thank agree. Yes, I you. would


with BTIG. And question. Tim question from Hayes Please proceed our next your with is

Tim Hayes

just taking one, first to for the afternoon, bit. my questions. on good Thanks here Hey, little pipeline a guys. expand My

more ROE expect defensive on you're where you're rotating the pretty the that and more be senior mentioned I'd you're But competition. to average You portfolio is in with assets now. there right more focusing achieving line

just and increased mentioned earlier curious comments you So competition. about some

offset a this year, you yields So on with impact and the back And half just into market, as see if seeing competitive. things? the the more you more in be that should a negative asset of on back if side little the comes what capital by you're bit get liability think things of the curious,

Mike Mazzei


in So pieces. that I'll take try and

what evaluating in think we're I generally the XX%, pipeline and sectors. we're of seeing is about really office our multifamily what is in

bringing come reasons, is all being our seeing we're for But seeing we're the concentrated achieve pricing is so pricing what kind in, bit. two able in all-in So the a sectors lenders to activity our ROEs. in those also of their we’re obvious line

the on think be the that is market In the to of that terms that's of concentrated. enter amount activity competitors going I the of half dependent and back where largely year,

back for less within So see two playing asset may and retail field, classes. like sectors those opened you may up, larger provide a which hospitality, concentration

Tim Hayes

yes, helpful. that’s Okay,

Andy Witt

passive some maybe mostly Carolinas, of on Texas, a little looking we'll like acquisition doing we I probably where loans. feel as cases, we're Georgia, they're at looking areas focused have mean, been states the in some also really loan We've Arizona, we growth. areas value, at to we're been it less XX% call loans,

funding, looking really are narrow, hard in us. we're there like probably also, terms where assets more GAAP versus actual future behind more opposed there's value-add commitment of X% equity So the But X%, it's to much more and at that as transitional.

be about may right there we at get competitive, a down into which more will point, where and hotel an may a we there now, we quite like, reopen, great, right how going got But is it the great, do certainty and we loan one, assets the we've can the is in great, Now, got that a market find that great we've retail early, acquisition evaluate the some road, that and more opportunities hanging loan. we'll frankly, some a be start, as we’ll been the And fruit do those been confidence for could But economy to anchored had assets. need the low pricing the haven't right now, markets reopens, it. are that. have we there's more finding as grocery we

Tim Hayes

of of how at to up your Yes, from higher size function to just the that pricing pipeline I that perspective? has that sense. market just you trying a you're should down. mentioned yield of holding or is versus some that color come the for a as mean, makes seeing your the again, market end look loan the And average end been

Mike Mazzei

how to we're I not Andy not in we construction. you doing not doing. figure not we see earlier, we're trying here's we're loans, sizes defend doing larger think really, sheet, ground up to loans. our need to, said right have nine cash talk We're that as earlier could now. doing some not about what where, trying pre-development. have average we're we're when we’re doing is mezz doing And filings. to loan not balance we're the And about do We're we What

conditions now. sold That's multifamily trying mentioned, this right mostly done. being out That's also the to the now, as what's to, And what want are market, portfolio. I is we're is, And trying these there. we the to do so is right getting also we're rebalance what's

six when for as want see down can we that the multifamily. credit, so going things and loans, something to assets, that go really is one defend, And coming going goes we that size in us, will And more you're our want average reason And can dramatically. if the more better that manage happen. smaller make towards balances. that this we senior affect from loan to liabilities forward we're now, roll no heavily skewed having that of months holder want you sizes, a loan And to see doing you’re lot mortgages, we loans will first by loan things awry sure average if we you're awry, credit, a

there price And there. also may are better so now points that's be some

of be what, it. that's so market, prefer the no to matter area And we the in. be But

Tim Hayes

loans Thanks, just And of that's mentioned provisions I asset? the can loan were there on Appreciate meaningful then in any helpful. but Mike. impairments increases or specific other maybe, that any outside know you loan, Yes, you confirm Dublin or it.

Frank Saracino

No, this is No, there Frank. wasn't.

Tim Hayes

But those a if that my equity? here Dublin just loans, if the off have Okay, confirm, could loan, you you can can I if know, to LA confirm equity disclose net any information, last thanks, loan, the And the of Frank. this give extent my net top that mezz if the question loan. don't on in then five remember you you and rated that could you just just there's the and I it's that, head maybe leverage

Mike Mazzei

direct on fixed-loan. leverage loans. LA on no there's these There's And the leverage no

go through you’ll and assets and said of additional see We vehicle, that were second some you I the that do if these make, of we're think However, in the information. preferred a did I filing. financing, some we quarter, part filing breaking the that out XX-K, outlined in the

only not some that loans, owned, on we more information estate also information we and some we on did some So vehicle. on provided more some provide real

facility, XX-K of that those pledge, assets like filing a type be so that equity pledge it's of an that could your a if CLO like there warehouse or direct And to that you answer question. we'd have not while see the that in will is

Tim Hayes

Okay. And to Yes, look have have Thanks to against for you for the reserves able those that. I'll be that would disclose then in to the you loans? specific pointing filing.

Mike Mazzei

CECL? In of terms

Tim Hayes


Mike Mazzei

loan, don't a kind so against reserves don't them. is necessarily we reserve particular CECL disclose, I we have the of remember Those portfolio think

Andy Witt

back we write-downs quarter, But I that Tim mixed-use already largest the this two to non-earning on occurred have marked we and point should say those seeing bucket, on Project I get back the you're last quarter have when to we then the their substantially did in have substantially, mean, those. loans LA back so asset Century level

Tim Hayes

Right, right.

Well, Okay. again, taking questions. for thanks my

Mike Mazzei

for you Thank us. joining


[Operator Instructions] Delaney Steve next please question. your And proceed question from with with our Securities, JMP is

Steven Delaney

the this and Mike, all Thank to It's evening. and Hey, last months. the over Andy the Thanks. congrats to you on listen you. six update progress to Frank nice

to, that does of second to certain unsecured to about your be The this, quarter. preferred doesn't loan that you just thought debt, that about claim? have got a financing just work Or assets bit kind want you've you term talk you everything a the little preferred corporate have? to on But You just debt. to is like around lien? that assigned sheet where in touched first and financing, wrap a got that Is balance preferred the I

Mike Mazzei

latter. the It's

Steven Delaney

good. Good,

Mike Mazzei

It’s way, not to joining will question and in filing, by a to hear assigned you. to the what I here, answer term not loan would have the go And to assets. B, say in Great five quarter. to us. And and filing precise that be question that we to a that for did, this you this the specifically thank the avoid XX-K filing would your and able I you'll Steven, be

Steven Delaney

great. Great,

Mike Mazzei

a term discrete five, it is vehicle. assets five it’s But not pledged loan type, B like

Steven Delaney


gets be. past, the balance the get like me you're got you've sheet. progress congratulated where second this six half this sounds good to lending. to still on just in kind It's really seems you half a the of look I'll me, it year your months want that you and you to But So assuming at year great it at normalization further economy, and to of look you,

you is if you seven are to preferred but high, have with mortgage seems don't easy unsecured on corporate the ratios, put allow Now for to just a to five, three coupons almost segment, a moved to on? amount any It $X new That's put how want higher, grow equity knows your going trends, bit top commercial good thinking do to three, now hasn't one modest you the to who too terms just everybody and years, of of that financial in use have comfortable But monitor debt how for the debt of you of work boost company only and your Thank you're you on me, rates my corporate And because equity. equity senior range much. it's that analysts et kind but little sheet, like question. analysts, the you ahead, most the longer I'm where little really it's get base, might cetera. billion just just another retail. the And assets consider of thing are, give the of in about debt, thinking moving balance REITs don’t four-year notes, ends you. to

Mike Mazzei

question answer flexibility great of liability lot substantially our like a to that. That's There's our loan in And peers of term the some are have. a peers a yes. some It’s of in question. structure. the And is B unsecured then

was to capital? think like need at this, Well, in periods a so not And your crisis, when cost raised of look was go And capital we that cheap. I what true you you that time through of right.

more cost or cost. had on an when you backward, of loan been balance the might talk that balance debt had having sheet capital B, term expensive. I the on And say, less about gee, forward, you look to looking you unsecured cash Well, sheet. cash at opportunity then you the have look when comes So with and that

had we can cash if and cash have more assets things could factor in we where unencumbered say, So less around. move we have to we that

Steven Delaney


Mike Mazzei

flexibility more our have with sheet. And balance

operation dilutive assets but discrete versus it putting has that more think looked be So only might corporate at. has its might you're expensive secured be and in on that is I a I face, I think your structure, do that term on, look to having loan, coupon something to debt which overall in think costs

do something be may I be so And agree something end you. back look think the we settled, year, towards with that the may much that and that as at. a I everything progress that we closer the in that later of else get year take as we

Steven Delaney

those best thank you All Well, the And XXXX. for for all comments. right, listen great.

Mike Mazzei

Thank you the question. for


I'll And of turn for we the call management question-and-answer closing And to now our end the session. over reached have remarks.

Mike Mazzei

XXXX early for our to Well, you thank for April that filing think I Bye. joining call. everyone to at to very, very very We we've encourage additional our there. Thank want look provided worthwhile. XX-K first is it And the call. in joining quarter I for information us the again much. you we forward everyone look would earnings


This lines concludes your today's disconnect this for at and participation. conference you Thank time. your you may