BRSP BrightSpire Capital

David Palamé General Counsel & Executive Vice President
Mike Mazzei President & Chief Executive Officer
Andy Witt Chief Operating Officer
Frank Saracino Chief Financial Officer
Tim Hayes BTIG
Stephen Laws Raymond James
Matthew Howlett B. Riley
Steven Delaney JMP Securities
Call transcript
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Greetings and welcome to the BrightSpire Capital Third Quarter 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. A brief question-and-answer session will follow the formal presentation. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, David Palamé, General Counsel. sir. you, Thank

begin. You may

David Palamé

and Earnings welcome Third morning, BrightSpire to Call. XXXX Conference Quarter Good Capital's

We BrightSpire refer throughout will to this the BRSP call. company or Capital as BrightSpire,

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

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

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

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

Mike Mazzei

financial thank like wishing and I quarter everyone earnings David. key us off highlights. you, our I Welcome joining start by Thank for Starting some would today. to with well, call. to you third

quarter. third from adjusted per up were distributable $X.XX earnings For last share, the quarter, XX%

in loan, I quarter book an is continued share. internalization as business the a increase later. the up our supported per quarter the plan. in prior is year. value from and I in to in Directors $X.XX successful third reduction of our reflects of Mixed-Use discuss undepreciated my stands reinstating earlier management our from report at cost write-off November share which Our and mezz $XX. prior from is will current our value fourth remarks The book execution to the has The our the is pleased liquidity dividend overall X, of this Board dividend, $X.XX to realized savings $XXX am and approved increase respect This increase million, With since our the by the dividend the of of quarter L.A.

Our increase of our goal deployment is cash further full as we balances. our dividend to reach

which and in deployment, in to Andy we Looking The loan, the closed is emerging rebranded solid Signia hotel, property we discuss third the status high quarter, Hotel accrual largest At the Hotel's the bankruptcy, had Jose our more the open Also, without umbrella. on a performance, our loss. newly San quarter reinstated to capital from has committed detail. third a borrower at will billion. loans Hilton as will non-accrual under been totaling XX a have months, XX $X.X or in in level, quarter last

committed subsequent BrightSpire. borrower track mezzanine loan repeat a this we include more During last have office have Multi-family outside middle-market quarter, end, loan with has a to to to we quarter record Multi-family of a increased Further, strong our steadily originations that properties. performance with

first mortgage, continue if to mezzanine we lending fund forward, situations in only opportunities, will the selectively wherewithal to consider but where have necessary. Going we the

toward and continue XXXX, complete into portfolio third originations an liability cash the rotation our CLO. is and plan and to eye our company to of XXXX substantially loan asset our of redeploy into issuing structure remainder the with For new

Finally, I of property. interest the million the in the mezzanine participation write-off L.A. of value on to like book would $XX the Mixed-Use discuss remaining

retained you This participation July. the that into As controlled $XXX third-party past went first junior default participation of of we was mezzanine with million rescue recall, that form loan. capital in investor may September EBX mezzanine a funded mezzanine a XXXX. connection The a senior interest and in mortgage, by came maturity substantial in loans in this existing and

purchase in the last senior Just that notified their right committed billion. investor we amount balance exercised mortgage of a a same million private This approximately of participation mortgage loan loan. that fully had $X.XXX defaulted month, the were first $XXX and mezzanine to

hotel to not still been the Furthermore, sale of also condo sales have non-existent. units property opened the at has efficiently additional yet been achieved. has the business, While the hotel of

have We key fluid. restructuring situation the regarding and very possible with parties a remains in been the dialogue

However, there mortgage in a on of an with this ownership recent the change foreclosure the entire first of likelihood increased mortgage, capital stack. is the

action and have foreclosure investment. While A clearly the along in been potential sales current advised that substantial may we disclosures and past in refer stagnant a This have occur. has our in Please resulted condo we more not on this a negative change XX-Q notice, write-off to property circumstances, recent continued impact formal a in details. Form with received unit for of the result would yet any foreclosure recovery.

founding risk Poor's, and former & a Managing commercial Bond estate at Last of than would Kroll addition it BrightSpire of new the Director like of mentioning as important an to a XX before announced Diamond Rating Standard we to executive Now, in has Kim Agency more years new experience Kim I over close the as and to member, oversight. turning Board real month, Board. price Andy, by appointment

have business. turn our will vast to working her now now look to Kim Following would Andy drawing and the grow upon Board independent forward Witt. over with BrightSpire as continue Chief five And Operating call directors. Andy? I her we like that, the appointment, experience to to with Officer, We our

Andy Witt

focus portfolio simplify and business plan quarter deploy continuing initiatives. while on will My today strategy. earnings. lending on grow Mike, made the to you, middle-market third substantial in progress BrightSpire's We management of highlights execution remain The the capital on our our and to and capital ongoing key Thank the comments portfolio objectives, during a operational continuing the to everyone. focused company existing and including good of number while asset managing deployment morning,

previously Capital reported, As we under and during the BrightSpire managed second quarter, CLO on the the the company's third executed first brand.

CLO quarter, included which or CRE late early portfolio its across we of anticipate of The on Additionally, number by a is company mortgages average consisting XX million executed and an successfully reinvestment loan seven positions, to with collateralized XXXX. year structure advance diversifies are issuance our rate resolve million CLO. costs. investments continued sources floating capital. period in and at secured third We The our coupon of Early second by in the weighted transaction $XXX plus efforts features pending a a and five funding initial XXXX XX.XX% transaction properties non-accrual of further term X.XX% sale, two in managed positions. of L before this interest rate $XXX closing cost in [ph] XX reduces the the

and XXXX CLO executed billion benefit $X LIBOR to perform continues October managed first from floors. in Our

ended invested. of $XXX loans in loan the replaced present loans BrightSpire a Throughout replacing October which for XX actively CLO, reinvestment million. XX, fully been amount period, have the is XXXX, at total two year We which aggregate

managed which a closed the CLO, we now mid-XXXX reinvestment on CLO, the third focusing expect in to first have our With time begun on we frame. window execute

Our on remains with focus high-growth platform in active continued originations a geographies. middle-market the

of an million, commitment which $XXX During quarter, initially loans amount of was the senior $XXX with third XX aggregate the funded. team originated million

majority which All are first of cash are of flowing acquisition financing. the these investments mortgages assets, on

$XXX third quarter execution closed in for loans additional an four net of end, commitment million. amount of the we There million. have XX aggregate a loans on are quarter, economic investments demand million, deployment $XXX million, loan for anticipate to number pent-up During to COVID, including positive approximately commitment an an of an of fourth relative paid for in the Subsequent $XXX two with total aggregate in of resulting off about total $XX with to resulting XX in and expansion. quarters rate date, several over the reasons, the quarter. close of totaling environment uptick activity million repayment loans due We $XXX attractive scheduled a a to next combined in

portfolio CRE debt three, is and as lease mezzanine presented and distinct net three estate; one, equity; real our senior preferred segments: highlighted, and two, other securities. loans previously real As estate and

book of focus As loans of assets mezzanine XX% remains our has with portfolio a portfolio. portfolio of diversified office collateral on originations and excluding cash The size, and XXXX, $X The value the and preferred activity. and lower balances of net on XX higher net in given loan September geography, comprised Multi-family senior properties. average sheet, an XX, loan recent terms type approximately billion of at-share the aggregate and is investments and equity or balance

capital and mortgages. company's this ahead, be Looking more the the will allocated of towards specifically first majority to segment

we in $X see CMBS equity investments we Mike million is of remaining Subsequent to $XXX in XXXX. of mentioned, with to towards of quarter and that to However, value retention the CRE at retention value aggregate we portfolio this in aggregate deliver resulting positions In mortgage million are million summary, small real net and portfolio, one value one which composition approximately bonds the to XX% our and currently of subject lease in opportunities and risk and total estate the for execution June XX a an proceeds, net point, in comprised real Net mezzanine Multi-family make gain. as pro provisions estate is loan. of on at-share earnings. are book risk mezzanine explore starting other of sale through $XX predictable transforming and of debt end. end, X% At loans or with XX% line segment a interest, a or that current an a comprised private includes was segment progress at-share securities, good will Xsix of portfolio last position reporting quarter book quarter. remaining debt forma the associated we securities. senior sold of continue

of well initiatives, pipeline third momentum head the towards turn Saracino, elaborate certain results. as year-end. fourth quarter call that, a the positive Looking on loan we positioned continue to quarter Chief With over I Officer, to BrightSpire, coupled management to with portfolio the Frank the strong will Financial ahead, the our execution has

Frank Saracino

everyone. and you, Andy, Thank good morning,

Form XX-Q to our mention Before discussing want today. we third our results, expect quarter to I file that

I With share. realized XX-Q. and settlement total which results. addition, to earnings, details of million would the asset-by-asset let's in our continues is losses to of Shareholders your quarter our website. available excludes to to attention our In section supplemental financial or distributable Form report, per $X.XX fair that, company $XX as our adjusted third does draw which turn like provide The We adjustments value reported

share interest per with a a to common per and mezzanine described $X.XX reported or also of We net reflect the adjustment million the total of million attributable loss detail. Both $XX.X $X.XX our in fair value loss loan property $XX GAAP share. participation that Mixed-Use GAAP company the Mike distributable L.A. loss associated in the and stockholders distributable or million $XX.X

$XX.XX net to quarter, value undepreciated third to book the decreased per per total the This During from value $XX.XX primarily share, earlier. from $XX.XX to share an value due $XX. noted change company GAAP decreased fair is adjustment book

$X.XX his reflects over investment to XXX% transaction [indiscernible] so loan as associated the close portfolio, from increase of a of to to our in increase distribution September the mentioned the sale combination XXXX, of We This recording of the result plan well the or portfolio share. early XXXX ownership. net undepreciated Andy late is BrightSpire transaction at-share As anticipated financing. sale off to our the doing projected warehouse triple-net is gains per value the of with back utilize as XX, The XXXX. pay of reverting in book preferred remarks, proceeds

We this this a narrative investment XX-Q. provided of summary quarter's Form in have

primarily million $XX appointment approximately quarter. contract, the quarter our to the anticipate internalization company's second On realization earnings. more cost idle of the reinstatement from of annualized accrual growth of in distributable year through of Looking $X.XX operating cash, detail completed which adjustable full midway benefits our and status third was basis, largest the the Quarter-over-quarter cost loan at internalization. the reflects the management we per savings an from generating per share or approximately of saving

Turning to our dividend.

XX, along of earnings, we with performance as Given quarter per for per XXXX, business the fourth The XXXX, and $X.XX a XX, of share is fourth share of dividend payable outlook, of up in distributable shareholders quarter our January operational from $X.XX adjusted dividend quarter. improved our XXXX. December last to declared on growth record

Moving our to sheet. balance

assets XX, total of stood Our at-share $X.X at billion underappreciated approximately as XXXX. September

up from at This originations. X.Xx new driven XX% by of the third ratio the was at the Our debt-to-assets quarter. was ratio of X.Xx loan was net second the debt-to-equity and quarter, end primarily increase end

and today cash of our as on liquidity approximately between bank $XXX million under our hand facility. stands at addition, In availability

risk status for CECL the million finally, originations. to and our third rankings CECL remarks. that, of call concludes our essentially as bankruptcy accrual at change of with prepared quarter at to is at compared That loans. Looking ranking quarter the emerging related This senior end reinstatement up was and against Operator? X.X our And loan And rich primarily to open borrower loan is the the X.X% to $XX.X loan as well of our represents improved portfolio end quarter. the flat reserves, and overall provision largest approximately X.X second loan our of the from reserved This the to the second quarter. questions. third let's


question BTIG. first Our your with Instructions] proceed question. line the Hayes from of Please Tim with comes [Operator

Tim Hayes

morning good Hey guys.

appreciate Century open. remarks But is you for have write-down recovery scenario on the being Mike, color and First that can walk And there? prepared the the the hotel the just I prudent question you some to might around through now - all a where with maybe Plaza. zero.

conversations You was for And up. - those guys were recovery? lined had a buyer and see previously I'm what to happened just take potential mentioned some might there curious you what or it that with

Mike Mazzei

you me thank Tim, for you Can Thanks, hear and okay? question. the

Tim Hayes

Sure can.

Mike Mazzei


time I disproportionate the group spent, firm, five my months a So this with first rescue the I tremendous of the amount joined transaction was - think, capital focused that of on with a here. the first amount when I

- year, our the not the Hence, junior this rescue play disappointment into expensive. issues value we is well, to have this of capital a mezz spot. The is that When to up. have there's capital The albeit Unfortunately, and piece there. gotten participation So is the us the I costs through. say replacement supply the chain last it and also with is we underlying value I for wherewithal there. brought as do asset of mean, why and backdrop going to in there, inflation

So the prepared million completed, the mezz value said the senior rooms culmination of remarks, fact at $XXX pay was along I a million, piece. balance, we room mortgage participant with buying been hotel and XXX that is the sale the has But for would really not my believe there be in senior that the our first $X in which and the that that outstanding down significantly yet would debt. as

and So has of And the of That calls I've been of presale and the saying critical. on lack previous there's in condo closing that of is yet occurred. sale of sale the also not hotel that units. traction

binary of not would think, bias of looming. a So acquisition outcome. to the then potentially all be we've a there's had, that mortgage heavy the and first there, be unreasonable a especially that would happened that binary of sort information that's I with foreclosure the in October delays anticipate outcome that a that with And

the are possible a party. in but mezzanine matter. As and who value I for participant same mortgage of Is piece, in said, and cost funds We senior there's it continued are contact the time recovery? our with

on process, mortgage. is play us upon that that the we're cost still we a and owns what the now thus And so And private likely that to is in so is mezz, potential would think capital imputed preserved restructuring UCC high is longer. that, investor will we we've path There that that based seen of But through be private part where there done. be most the with may a unlikely. investor, the very of foreclosure first us allow far a

senior that quickly could a at and our on pick beyond value of we possible considerable value third-party they can't the the come But It stopped have at there cost thus would mean far. is piece. weigh foreclosure, - impasse that time an see would a auction doesn't participation. spent have happen there mortgage is them because where discussions - of have It that public the can with a also up and to occur time. this will time but capital on that later date, through that occur, that So they bidders mezzanine at is have

and collective very it there was would along in beyond see foreclosure, variables if a done cash is senior the mortgage they value So property, quickly, you've possible that - there involved that through, is that property bidders make And excess in flow predict. hard the if are that but that other did that, to - number moved plausible that, the it's of participation. would that a come you there with

of - of in momentum capital been the value destroy really of and a lack cost and delays has sales So that. are part the cases, all time big our the

So the And situation they don't lenders have is That here, story first this the the do takeaway the the answer question? stack should and that for this, the cap not moral ability be your to result. that mezz where of the is protect. in was and

Tim Hayes

Yes, definitely. Yes.

through here Just walking you the paths different potentially. appreciate

at zero. right it's So now,

no is financials if good. a be economic the for upside. wanted But could sense impact there forward, some get So to going which to just

excuse Now, Q housing just Island office, and Island to highlighted maybe portfolio. the me, watchlist student you've office, previously, of or Long City in the turning some Claremont, loans other the Berkeley Long

been to Century under - are passing updates assets X there any the Plaza's along? to at those of if sale wondering now is resolved. Fortress has and any point Just at some worth and that close And scheduled is Fairmount

have You non-accrual. don't any really more outside

maybe constructive if updates you of get? any if watchlist or any these see to just taking So loans, there's curious that spot

Mike Mazzei

with where sponsor, is felt New considering one did to into uncrossed. be sense there's into made contribution more came carry. They we then, and valued the do through the leasing get had asset, the that was reason we was very lesser that by we the asset borrower, is but out, assets were in We've XX are York cash back loans And were where enough that, activity interest the the did same that to so we issue. keep sold office. where metro both property, visibility which We've there that situations fund was from the not would we where table with status. the differently to our overall the borrowers one improvement other put has sponsor. funding different. of uncertainty. worth response. borrowers because we months, work and is accrual our the applaud San Jose with Island not asset borrower's asset, given versus only leasing that other acted next City loan, as borrower There mentioned, borrower we the efforts loan to on are today default in got with bankruptcy considerably. charge more deals, borrower applaud Well, there's during this to greater this both capital The discussing with deals the over the that quickly. that now those we selling is and stuck selling and that retail. capital up been the to potentially Long the we during is It's that really borrower's negative been felt and COVID. the the funding, so, why the far pointed we We the efforts And in borrower The We the the the felt stance, occupied have asset period the borrower helping In and

a of future modification. was felt a compelling we some partial of that, repurpose We So our did advances. that

we'll then, fund if sponsor's assist go money to good us. capital, And back with First, our then, some future the ahead news will on TI future the ahead of and repurpose of sponsor money then of money, go the advances carry negative will the borrower's And end. needed. us in

arrangement So fair. thought that which made we them, we was with

need that year's in getting Long worth another borrowers' Island City, So of a visibility again, of capital sense. contribution to thought given we lot the

the in property is to more occupancy another lease and second with, there works. The has begin

borrower so, us talk is the to negative on are next far carry positive. the that. some already step And to has we that's there that But February less. activity until the on And about seeing

assets. much pretty those it So on that's

think the visibility will give I that think, months the have does we And than that XX lot. a say us up I do time borrower more fact today. of a put money ton

Tim Hayes

there. Great, to interest accrual? Jose, much my just we San update quarter? And around just you was and should last that's good then, how on when from what next recognized curious how asset that did question that quarter putting expect past Fairmont, much this start back income a - relative loan I'm

Frank Saracino

Sure. Tim, it's Frank.

but So accruing on the interest we emerged loan as it went from up months seven picked of September back bankruptcy, in income.

was So million $X.X that about $X.XX. or

be it $X.X when which - financing. that's little it $X.XX share, is and per expected under a We forward, goes will to quarter, before moving a about million

Mike Mazzei

for We loan are process that at in point. this the financing of procuring

Tim Hayes

Good deal. time the We'll stay tuned on this that. Thanks again morning. for


Our of Raymond comes Laws Stephen Please line your James. from questions. next receive with question with the

Stephen Laws

Hi morning. good

went off, through. assets that Tim on appreciate those First color the

So Andy for growth here, thanks think details talked the and quantified pipeline you you if about - or for the Frank, us. from there. leverage

leverage of expectation? think in I assuming up are will prepayments in Can quantify about generally maybe the the portfolio couple majority then, targets - probably growth senior what your And are quarters. net loans? the next with investments just talk of you pick said

Mike Mazzei

to Andy, Frank experiencing we're quarters touch do leverage next what up in and prepayments can over want you pick few piece? the on the

Andy Witt

Sure. Sure.

And relatively highlighted expect in we as had to remarks, in prepared the quarters. quarters. prepayments activity we've over modest the increase the we recent coming So that

So the And a million to may prepayments see $XXX next quarter, repayments. into of going then, year, anticipate quarterly we here on seeing million basis. fourth higher in $XXX

impact. over of neighborhood I'll in billion to and the our here is the it course originations net in quarter, of about somewhere basis add see and focus throughout to the continue for And assets so, today growing loans that a $X.X is XXXX. from we portfolio, fourth it to program the to continuing to where then portfolio turn grow you on And in obviously, Frank, the our to

Frank Saracino

Sure. Sure.

XX% far think into continue And ability into quarter. last debt-to-assets at the As getting XX, depending XXs, on quarter. grow XX% was the our our it's to deploy fourth leverage, this maybe of and quarter, XXXX, just touch Stephen, timing That high to to the as, the will prepayments. as again, we

Stephen Laws

Appreciate and suburban Great. in about attractive property you Can your more office, more see some quarter the the look attractive have last Mike, a you're where what mentioned prepared the that color, talked portfolio type you going should little there. what best in color you remarks give guys active and you - us geography, there. investment we forward? opportunities the most of seeing to we should increases expect mix been

Mike Mazzei


First, to The property have spreads to some let's been couple, that, in But We We've to [Technical and hopefully in cases, in with above based story we're XXX, see and came high-Xs, haven't hotels. multi-family movement bid on Hotels we're of and into have year the points credit tighten property. see and all to low and targeting high-Xs, - achieving going supply is to to on double-digit as saw kept office we other to where we're In property a still, with spreads ROEs. - a that start overall depending that's and successful. around maybe talk back that's and a basis in mid-Xs, but continuing advance starting [Technical And also so in trying CLO the types, been real spreads the there's leasing knocking the rates high banks about the issuers the demand remains widen warehouse partly QX, activity properties and that the higher market. on LIBOR. ROEs on still fact we shipping at did to in CLO X%, the the CLO. if credit are to Difficulty]; XXX on year-end. we're were this able the as seeing actually Difficulty] quarter balance we're much lot third mid increased their due spreads despite abreast types, Multi-family targeting are issue sheet high-Xs AAA execute

the Multi-family. backup So that has in caused spreads in

of acquisition considerably we've countertop that rents what borrowers done of portfolio in refrigerator. new our terms loans actually popping are In is new the even grown and asset over we're they experiencing have this spreads - everywhere. are put or that valuations, past now Multi-family, in seeing in own year, we're a borrowers And underlying before a just almost

has on is. tenants they're renovation just kicked off, the Before as popping program rents existing

So three, also thinking that appliances may our by behind on have business duration shortages. their a or four be has well we're for borrowers that we're replacement some of see. because and existing bodes future interesting further chains delays, headwind and development that five to every portfolio months is it supply, think doing Almost been longer exacerbated big by plans up, cost a component in now may because we of of which supply is for time but and existing labor

that doing the debt yields of there's concerned Now, coverage we're the property. about we're where because have not loans

And and rates or So But in have cap we're longer seeing some duration there'll We're cases, with seeing not worried the rates about the shortfalls in be rates handles. we we're portfolio. taper eventually X is in cap interest that. and do cap advancing think compression hawkish considerably. a in Fed becoming dropped double-digit Multi-family face the where bit two tighten. little we some handles The cap have the is a rate is growth. and will instances. more that alarming rent happening And in of this in

compression cap seeing that we're off and but current not increasing Multi-family alarms So occur, pushing some at watchful something We're speed valuations being in where we're rates, that rates getting on. on of only is of. deals, that were we

concern very deals cap with have more the while and considerably low Multi-family or rates see inflation compress is rate. that on is back pushing in late tighten stepping into catch-up we're fourth So quarter this as some play to we cap taper we to are going that And X% have here Fed buyers tight. the

million of something continuing growth, So find types, to higher rating in is market regard of drive and middle-market that's CLOs, are that below advance but transit on. most where a like finding lead in other why valuation. path CLOs And keep the where we'd the to loan and value to in rankings play With an eye there's risk suburban agencies another to office, there markets, there's more we're to sizes. there's stronger [Technical favor reward getting heavily value, sizes to rates that's think on in reason higher commute, more that as I property we're $XX opposed Difficulty] we're value the and and to office, loan why mass work and to

hotel the seeing has are bid for. started, actively few there, that we are because but assets some just out getting that said, I As they're of

Stephen Laws

Thanks That's the color. great for comment.


next question Please question. B. with comes with your line the Riley. Our Instructions] of proceed from Matthew [Operator Howlett

Matthew Howlett

just your year-over-year Tanks transition. everybody for picture taking a I question. into my this question. Mike, big mean,

You've - talked levels, it'll if up where take above up are I are trading how peer so you Where to you color, Just will? are the think mean, how the do cigar, to speak? NAV. we, getting away general some light dividend about long to you we? far

Mike Mazzei


happens, the size before commercial And selective want year is protect. have. renovation sale holding to happen, little is plan strategy have mortgages ourselves us us we're when looking have sale programs things budgeting do take mentioned credit, cap mezzanine one REIT necessarily that. along just think regard we the that you're to and described loans for and does prepayments increases XXXX. don't assets triple-net of we to But preferred a try of the office. because as do especially will. a rents We that doesn't along the defend for bucket quarter with this on we're prepayments, prepayment very or well, continue ahead And those for they our we a which to That approximately that to I add think into the occurs, more first is this begun. mortgage be It budgeting deploy probably I getting valuations of of of disclosure We our loan coming further as rates, bias schedule in that. cash their we that, it's mean triple-net, to toward some Albertsons as in but positions tariff, that have. stay quarter we and up. where to share think will out on of XXXX still demand budgeting are next the where that I we basic GSAM can One, the did off basically for their increase ahead that lease that of prepayments. Fortress the seeing we're We're we bit pure-play that pent-up not we So COVID giving try to think pick at simple. lines we're that and what step With anticipating Andy to We the going borrowers know will financing average first what when that year. of more

at asset in rate. to own the off We out So more throwing It that asset coming vehicle financing cap balance that ROE XX% be that and when place on occurs. it's that's about on today. debt we want to roughly give that of sheet an based disclosure a on the XXX% because is X% going

of We about lot that. questions have asked a been

And in a associated so payment and defeasance that great One, And until with believe we is not us. there's large that from yield place when for something XXXX selling. it's a there's look CMBS because get that. anticipate XXXX, because separate two, at also I 'XX, we

last XXXX. out say, would is still the borrower Of business, And three the various part supply reason thing least and or the the defeasance conduit I'll really engaged there, CMBS it four the are that's that much is selling amount that not asset, so market, much the we're one light. we and of got gain-on-sale maturity not yet asset on until that budget the the that business, not has smaller. silos think then, closer the we yet consider single payment date is for of And versus single that issuance CLOs. that for the And

that So competition supply is is tight, business in tight.

into factored XXXX. haven't something for So we budget our that is that

Matthew Howlett

about that So you're thinking conduit and reentering the business business?

Mike Mazzei

get is is, for - in that it bridge that's not business, goes gain-on-sale the I of to - the the conduit said, his path on And amount And enough budgeting. XXXX, of something not the not the not that is versus business earnings business but the EPS we is to take our for not look right as when for get part We're to reason part through is XXXX, think - consider Frank you us effort very would at relevant now. competitive our yield that you'd it. it of to the It can it's not expectation. earnings is

Matthew Howlett

of think the you you a But was for on my think you sort you. net if tight I I'm to through mean, put could prospects get I potential the you something business. it, the And sure even I bit. going not book that. above bid answered leases, in on value. ask it going capabilities, question answered that undepreciated I certainly probably wondering that up just Seeing it's So,

go your I I and control is to want issue. the selling you every you largest get that. what shareholder call know technical So to can't on a bigger picture you're this I know it

that, to in So conveyed there can anything you you at point, as stake can of technical such some give end, with what do buying terms you? your of that And the they've on back? us anything issue their some is

Mike Mazzei

sellers they certainly the have ahead TBRG are reflected BrightSpire. the We that the and have end perform is think They could very to thing that everything of non-digital. do are supportive the when price. and gave that that they we best in is They our publicly hopefully on stated us evidenced - to stock Digital light very go do I green internalization. of

about sale do expect their have X million specific place of a that shares, of it secondary any reduced we sell, of in they not from embedded continue offering they by holdings They company. So we timetable. took million XX the assets did. think that I are XX units will to that were came the And but aware at million other

to my their that certainly, factor that think into of to perhaps more that book, get the fact least that the allows achieved given I fact firm think below timetables. reduction we more trading our are I that that speculation just holding can't get but on and they're they this at deliberate. we their plan a be to behalf. plus frame a I the paying So them given what in to to believer my part up thesis dividend also shares. be minus, a This I time million, are given speculation income of on them, their and allow do via we increased why or earnings deliberate. book down execution of think and that that our up, asset and to can they've quarter, do about that I think and can the they're dividend that be dividend the is terms will have XX getting And speak on just would as is the that is. our

can the do perform. So is best thing here we

of don't of the buyback, to they closer go and and because that, we shares us. way way terms on we is the buyback have book the wrong just equity where compelling, based a shares got and and internalization think we operating management closer think also is I are But the In fully. shareholder where are other we unfortunately, the the the on with gives book value. to realize acknowledge economies that the to trading, terms we in of benefits the And value, trading that contract, today. back that bought

We our G&A think equity want smart the simple So that thing have go a up. a to cost our the regard buyback. of We shareholder with to percentage reduce of as don't goals are very scale right don't it's now. and

and goals do maybe book But the as comment we the should grow are earnings, maybe simple is the XXXX, then above So that mortgage for deploy every commercial do a value. press just then capital, do.

Matthew Howlett

all just see the color. line appreciate system I answer. trade still have you thing love above know Yes. there. making should that peer I'd I group. I in to appreciate control the Look, you can't the to get I mean, it. you the

share their count secondary in is September. million down said they You that did the X post

Frank Saracino

post So XXXX. beginning this in to they are to year. shares of at Highgate X but Aurora embedded wellness it million close down sold have the That million XX their was and transaction will the they business included - that earlier about secondary,

Matthew Howlett

Great, thanks everyone. lot. a Thanks,


from comes the question Steve next of Delaney with Our Securities. line JMP

Steven Delaney

given strong has specifically my the obviously, ORE tackling in the you you blocking raise you for and at lease certainly the comment you $XXX that,. to on look basic It Cap creating for around we net that, seeing of to with generally. think taking did everywhere, the the as loan compression you that uniqueness Hey, When Norway, But is that a comment And there in that going million just the Could it million. it with the business. alluded it $XXX good to plan across rate morning. that on morning, rates, a forward and large of bridge Mike, value size we're of duration? and on question. of that it you specifically simplification, question given could something seen Multi-family. portfolio space. bid does a Is hearing respect Good for, everyone. X-year asset find Thanks be cap this the we've

Mike Mazzei

asset to Nothing probably something is to Welcome Norway. are But call. against Thank Steve. do. there we that an the asked you, owning not

- a is debt is something on that, at There a that, think XXXX. a we've at something and up I look and on the I important, the why And that believe was with So doing comes reasons direct later of in XX-year with that that XX-year disclosure is date. that's got that be maturity. lease financed we'll one about very

So overhang we have to a needs be that addressed. X-year lease

don't to asset. the pay the date have we to refinance down later debt having event and So a at a dilutive

that work extend I extend beneficial not go done and lease often - where that think long before borrower, to we that that lease out that extend that entail can - sell sort is beneficial because enough of that addressed. with do be done could So is financing. transaction, mutually would to so and some we we working needs back we should is the that that something which that

are energy very you they You're public their this on that. value leaving with company, and - world prominent. you're would that, well very effectively, some their table Having stocks. are stock this expect their said Their headquarters. doing as has the if Equinor, is some And done will, you private year, if they

back And can hedged the for for XXXX, given a But debt. hedged. to it closer extend there is so, $X. good it lease the X.X need at credit we who X.X euro We've now. where we've the hedge the in meantime, it's Corona if low that, asset. the has possible, mid years. goes then extending $X, and and point now their the We substantially headquarters, very hedge, do if to I that that that years, hedge is That we in hedged said, volatile. renegotiate we the the get been the do given bid think But another right would and next in got has and be we'll this when about that a got the was it That look that been to for money. In as hedged we're

Steven Delaney

seems the personal just at it just debt seeing I and are so par. just for We're it about stress the team, Just looking just market property, as given think of to calls a thoughts something generally, in are and the general or money, Great. - Multi-family very selling. the yields hotels you least, relative but It like or That's I'm feeling just are that into just broad hotels commentary color. wonderful back week the didn't ago, see property months darn the space pretty seeing attractive are like And at curious, opportunistic office. people Gosh, lastly, sense. somewhat on transfer lot seems and months how even right or in you're last and be sector? maybe favor, your coming not that must you maybe would ago XX that And six we're there certainly a loans at we your call making.

Mike Mazzei

like you would comment Andy, that? to on

Andy Witt

Mike. Sure,

is hotels sector. on in we're opportunities. side, look get started what time. the a seeing we are are in And origination we rebound hotel So in and performance to the over at increase seeing select terms sector our the in of portfolio better that We're seeing have the in

half starting XXXX, I process. in space we would become a we've So space. active we particular of that that been It's in that year, this time thought second think and of active the more are we all

do We opportunities, to to there on have there. in spots connect the some any we'll those space, compelling are more look but very and hospitality of yet

Steven Delaney

that Thanks, Appreciate color. Andy.

Mike Mazzei

earnings great had this morning. Navia

So we you. more occur activity agree asset sale We just to credit see with so that demand need follows suit.

Steven Delaney

it. Got

for benchmark the Listen, So Stay comments. well. thanks values. just Yes. to


comments. We would have back the over question-and-answer end the closing of reached turn to session. floor I the to management like for now

Mike Mazzei

day. all you Have for four. at quarter of again end we Thank a joining us, forward good and look speaking to the


Ladies today's gentlemen, does this and conclude teleconference.

and a may time. wonderful you You your participation Thank disconnect your lines day. for have at this